AGEL a.s. ANNUAL REPORT AGEL Group CONSOLIDATED ANNUAL REPORT

Transcription

1 2012 AGEL a.s. ANNUAL REPORT AGEL Group CONSOLIDATED ANNUAL REPORT

2

3 Table of contents of the AGEL a.s. s Annual Report for the Year Ended 31 December Introduction of the Chairman of the Company s Board of Directors 2. The Board of Directors Report on Major Events of the Previous Calendar Year 3. Organisational Structure of AGEL a.s., Organigram of the AGEL Group as of 31/12/ Identification Details of the Company, Statutory Bodies, Company management, Audit Committee 5. The auditor s report 6. Financial Part I Financial Statements for the year ended 31/12/ Balance Sheet full version Profit and Loss Account Statement of Changes in Equity Cash Flow Statement (cash flow) Footnotes to the Financial Statements 7. Financial Part II 2012 Consolidated Financial Statements Consolidated Balance Sheet full version Consolidated Profit and Loss Account Consolidated Statement of Changes in Equity Consolidated Cash Flow Statement (cash flow) Footnotes to the Consolidated Financial Statements 8. Report on the Company s business activity and the balance of its assets as of 31/12/2012, activities regarding protection of the environment, research and development activities, activities regarding employment relations 9. Report on Related Party Transactions for the year ended 31 December The Company s Supervisory Board s Report 11. Audit Committee Report 12. Estimated development of the company in 2013 and the following years

4 Introduction of the Chairman of the Board of Directors 1.0 Ladies and Gentlemen, Dear Business Partners, On behalf of the AGEL a.s s Board of Directors, I am pleased to present you with the Annual Report of AGEL a.s. and the AGEL group, which brings an overview of the results achieved in Predominantly, the Annual Report has an evaluating character, but it also shows our vision, trends and objectives for the upcoming years. In 2012, we managed to consolidate our position in the provision of healthcare in the territory of the former Czechoslovakia. Our group has undoubtedly proved that a well-managed private company may be very successful in the competition of healthcare providers. Despite an on-going decline in payments from health insurance providers, the majority of our companies demonstrated positive results. This created the conditions necessary for the continual growth of average wages, which exceeded the guaranteed projections given by the Holding Company Collective Agreement, and thereby contributed to the personnel stabilisation of the entire Group. Our human resources policy has been confirmed with the awarding of the title of Best Employer of the Olomouc Region and the national award for Most Progressive Employer in the Czech Republic. It is very pleasing that even in our current uneasy times we have managed to continually improve the technical level of our workplaces as well. As a private healthcare facility, we must constantly struggle with the natural scepticism of those around us, and for this reason, it is essential to confirm and improve awareness of our high levels of competency in the provision of healthcare. Our healthcare facilities achieve significant success in the technical sphere as well, whether through the discovery of the hitherto unknown form of fibrinogen in Šumperk or the implementation of mechanical cardiac support methods in the Cardiology Centre in Podlesí. Many of our colleagues conduct scientific research and submit their experience to the students of medical schools in Olomouc and Ostrava. In connection with these activities Vzdělávací institut AGEL, o.p.s. has been transformed into Vzdělávací a výzkumný institut AGEL, o.p.s., which will coordinate all scientific research activity in our Group. Most of all, AGEL a.s. has ensured the management and coordination of the entire Group; either directly or through its subsidiaries it has managed a group of 36 subjects engaged in the provision of healthcare or the support of these activities, as well as the AGEL organisational unit. The most important value and result achieved from our efforts is the satisfaction of our patients and clients. Permanent improvement of the standard and quality of healthcare is guaranteed by the fact that all our healthcare facilities have successfully passed the accreditation procedure of the Joint Accreditation Committee of the Czech Republic. It is a testimony to how much our efforts are appreciated by our patients as well that we have once again been awarded top rankings in the annual Hospital of the Year survey conducted by HCI. In the previous year, AGEL a.s. once again traditionally organised the sixth year of the Science Symposium. Almost 400 specialists from the ranks of doctors and nurses met at the beginning of October 2012 at the NH Hotel Congress Centre. 2

5 Úvodní slovo předsedy představenstva 1.0 The common theme was the issues of minimally invasive approaches in medicine, while the newest findings in cardiology, orthopaedics, oncology, and other fields were also discussed. The programme including tens of specialist lectures was even this year divided into the sections for physicians and nurses. Among the lecturers were, for example, MUDr. Pavel Dungl, DrSc., Chairman of the Orthopaedics Association, and MUDr. Michael Aschermann, DrSc., Vice Chairman of the Cardiology Association. The dean of the Medical Faculty of Palacký University Olomouc, Prof. MUDr. Milan Kolář, Ph.D., also participated, confirming the very good cooperation between AGEL Group healthcare facilities and the medical faculty. These personalities also guaranteed the high specialisation and quality of this year s symposium. At the symposium the current grants which support scientific research within the AGEL group were also presented. The level of this support is ever greater year after year. I owe my gratitude to all members of the AGEL a.s. s Supervisory Board without whose active engagement, personal commitment, and flexible cooperation it would have been much harder for us to achieve such successful results, this year and the year before. I would also like to thank our employees, without whose effort and dedication we would not be able to maintain the high professional and human standard of our Company. MUDr. Filip Horák, MBA Chairman of the Board of Directors of AGEL a.s. 3

6 The Board of Directors Report on Major Events of the Previous Calendar Year 2.0 As of 1 January 2012, the commercial name of Radioterapie, a.s. was changed to Nemocnice Nový Jičín a.s. and on the same day Nemocnice Nový Jičín a.s. started to operate defunct Nemocnice s poliklinikou v Novém Jičíně p.o. As of 1/1/2012, Dopravní zdravotnictví a.s. purchased a general practitioner s surgery for adults based at Přerov, Velké Novosady 8, from MUDr. Marie Pastuchová. Thereby it expanded the offer of its services at this address, where it has been already operating other surgeries. In January 2012, in Nemocnice Valašské Meziřičí a.s., a new Centre for the Weight Reduction and Preventive Medicine aimed at the groups of patients with overweight and slight obesity was opened. This Centre also concentrate on exclusion of pathological metabolic reasons of obesity, capture of potentially risky persons and early prevention of lifestyle diseases. Mgr. Libor Vrba. a new member of the AGEL a.s. Board of Directors was elected on 27/2/2012 with effect from 1/3/2012. Upon the decision of the promoter of AGEL a.s., dated 27/2/2012, a new trading company was established with the commercial name AGEL SERVIS a.s., based at Prostějov, Mathonova 291/1, Postcode: A reconstructed outpatient part of the surgical specialisations pavilion had a grand opening in Nemocnice Přerov, which is a part of Středomoravská nemocniční a.s., New modern equipment was installed in the surgeries, a new reception was established and a patient call system system was introduced. A total investment amounted to CZK 12,738 thousand. Reconstructed Surgeries of Nemocnice Přerov Under the Project of Demerger by Spin off through Amalgamation, the medical part of the company being demerged ARTUR KOBLITZ, s.r.o., based at Brno, Okružní 875/19a, Postcode: , Identification No was transferred to Kardiologické centrum AGEL s.r.o. 4

7 The Board of Directors Report on Major Events of the Previous Calendar Year 2.0 In April 2012, a comprehensive revitalisation of surgical pavilions, gynaecological-obstetric and internal medicine pavilions, the headquarters and pavilion with the child daycare facility in Vítkovická nemocnici a.s. A part of the renewal was a complete thermal insulation of buildings and roofs, replacement of windows and doors and a new facade. A total investment amounted to CZK 48 million. On 23/5/2012, pursuant to the Deed of Foundation between AGEL a.s. and Reprofit International, s r.o., based at Brno-Černá Pole, Provazníkova 1241/23, Postcode , Identification No , a new company, IVF Clinic a.s., was established, whose purpose will be the provision of healthcare services in the the area of gynaecology and obstetrics and reproductive medicine. From May to October, a complete reconstruction of two inpatient stations of the internal medicine department in Nemocnice Přerov, Středomoravská nemocniční a.s. was carried out Two- and three-bed rooms with individual sanitary facilities were completed, an above-standard room and isolation room were established on each floor. The grand opening of the reconstructed premises in the presence of the governor of the Olomouc Region was held on 24/9/2012. The AGEL Group takes pride in the title the Best Employer of the Region in the Olomouc Region in On 7 October 2012, Ing. Iveta Ostruszková, MBA, a member of the AGEL a.s. s Board of Directors, took over a prestigious prize in a respected Sodexo competition, Employer of the Year In addition, AGEL a.s. obtained the 1st place in the category The Progressive Employer of the Year 2012 in the same competition. 5

8 The Board of Directors Report on Major Events of the Previous Calendar Year 2.0 In August 2012, Nemocnice Prostějov obtained a certificate on the fulfillment of conditions for providing the second-degree cerebrovascular care, the so-called the Stoke Centre, from the Ministry of Health of the Czech Republic and become a part of the national network of centres providing specialised treatment. It is the second workplace of such specialisation in the Olomouc Region. At the end of August 2012, the existing branch of MARTEK MEDICAL a.s. in Jesenice u Prahy was relocated to the new warehouse on the premises of the Airport Logistic Park in Prague Kněževes. More than 1,000 pallet places were created at the total area of 2,300 m 2. The WMS (Warehouse Management System) a system for the optimisation of stock management and logistics was also applied here. On 4 October, Diagnostické a liečebné centrum Zvolen s.r.o. opened a new public pharmacy Nová lekáreň upon the permission for operation obtained from the Banskobystrický Self-Governing Region. Nearly 400 specialists from amongst physicians as well as nurses from the Czech Republic and Slovakia gathered on 4 and 5 October in the NH Oloumouc Congress Hotel, in the fifth year of the AGEL Scientific and Research Symposium. In addition to the specialised papers, the continuing grants which support scientific activities in AGEL were also presented in the symposium. In 2012, the Ministry of Education, Youth and Physical Education of the Czech Republic, within the Education for Competitiveness Operational Programme, granted to Vzdělávací institut AGEL, o.p.s. the funds for the implementation of the Healthy Society Project, subtitled Learn-Try out-pass on, which is focused on the strengthening of a responsible approach to one s health, support of a healthy lifestyle, motivation to its preservation and interest in the healthy environment. Financial support aimed at education of broad public, will continue in 2013 as well. At the end of 2012, on the premises of Nemocnice Nový Jičín a.s., a baby box was installed and put into operation, which is already the 53rd box in the Czech Republic. A complete reconstruction of the angiological theatre in Nemocnici Podlesí a.s. is a significant event of A total investment in the equipment and construction work exceeded the amount of CZK 25 million. The above-mentioned amount was provided on the basis of a loan, which was granted for the purchase of technologies and construction work within the investment project Angiographic line/angiological theatre in Nemocnice Podlesí a.s. A new Angiographic line Angiographic set, Philips Allura Xper FD20/10, belongs to the state-of-the-artequipment for heart treatment in the Czech Republic. The Angiological Theatre in Nemocnice Podlesí We also decided to integrate pharmacies within Repharm, a.s. under the single brand LÉKÁRNA AGEL, so that the network of our pharmacies would obtain much greater purchasing and marketing strength and the overall image of the pharmacies under the AGEL brand would be supported. As a result, all of the pharmacies in the AGEL Group were rebranded in

9 7

10 Organisational Structure of AGEL a.s. as of 31/12/

11 Organigram of the AGEL Group as of 31/12/

12 Identification Details of the Company Statutory Bodies, Company Management, Audit Committee as of 31/12/ Commercial name: AGEL a.s. Date of record: 14 June 1990 With effect since 1 July 2009 (after the change of the Company s registered office), AGEL a.s. has been recoded by the Regional Court in Brno, Section B, Inset No Identification No: Registered office: Prostějov, Mathonova 291/1, Postcode: Legal form: Joint stock company Major scope of business as of 31/12/2012: production, trade and services not specified in Annexes No. 1 to 3 of the Trades Licensing Act Share capital: CZK 100,000,000; % paid up Shares: 1,000 registered ordinary shares in the certificate form at the nominal value of CZK 100,000 each Transfer of shares is conditioned by the Supervisory Board s consent. Method of dealing on behalf of the company: In each case, two Board of Directors members jointly deal on behalf of the Company. 10

13 Identification Details of the Company Statutory Bodies, Company Management, Audit Committee as of 31/12/ The Supervisory Board as of 31/12/2012 Eng. David Hercky, MBA Member Ing. Tomáš Chrenek, Ph.D. Chairman PhDr. Dušana Chreneková, MBA Member MUDr. Martin Polach, MBA Vice Chairman MUDr. Dana Polachová Member Hana Tůmová Member Ing. TOMÁŠ CHRENEK, Ph.D. MUDr. MARTIN POLACH, MBA Eng. DAVID HERCKY, MBA Chairman of the Supervisory Board Vice Chairman of the Supervisory Board Member of the Supervisory Board PhDr. DUŠANA CHRENEKOVÁ, MBA MUDr. DANA POLACHOVÁ HANA TŮMOVÁ Member of the Supervisory Board Member of the Supervisory Board Member of the Supervisory Board 11

14 Identification Details of the Company Statutory Bodies, Company Management, Audit Committee as of 31/12/ Company s Board of Directors as of 31/12/2012 MUDr. Filip Horák, MBA Chairman Ing. Iveta Ostruszková, MBA Member MUDr. Milan Leckéši Vice Chairman Ing. Roman Gavanda Member Ing. Karel Kantor Vice Chairman Mgr. Libor Vrba Member MUDr. FILIP HORÁK, MBA MUDr. MILAN LECKÉŠI Ing. KAREL KANTOR Chairman of the Board of Directors Vice Chairman of the Board of Directors Vice Chairman of the Board of Directors Ing. IVETA OSTRUSZKOVÁ, MBA Ing. ROMAN GAVANDA Mgr. LIBOR VRBA Member of the Board of Directors Member of the Board of Directors Member of the Board of Directors 12

15 Identification Details of the Company Statutory Bodies, Company Management, Audit Committee as of 31/12/ Audit committee as of 31/12/2012 Ing. Dana Trezziová MUDr. Martin Polach, MBA Ing. Eva Kalinová Chairwoman Vice Chairman Member Ing. DANA TREZZIOVÁ MUDr. MARTIN POLACH, MBA Ing. EVA KALINOVÁ Chairwoman of the Audit Committee Vice Chairman of the Audit Committee Member of the Audit Committee 13

16 A Branch of a Foreign Entity AGEL a.s. based at: Prostějov, Mathonova 291/1, Postcode: , Identification No.: Identification of the branch: AGEL a.s. branch Registered office of the branch: Bratislava, Prepoštská 2088/6, Postcode Scope of Business Activity: Purchase of goods for resale to the end user (retail) or to other traders (wholesale): Retail and wholesale of paper products, books, printed matter, school and office supplies, the press, magazines, newspapers, books, audio and audiovisual records, unrecorded record carriers, office supplies, school supplies, wallpapers, special paper, paper sanitary products. Intermediation activity in services: Intermediation activities in advertising; Intermediation activities in automated data processing; and Intermediation activities in research, development, natural, technical and social sciences. Business, financial, organisation and economic advisory: Marketing consulting; Media advisory; Consulting and certification in management and quality systems; Consulting and certification in service and personal quality; Consulting in healthy lifestyle and healthy nutrition; Consulting in human resources management; and Consulting, advisory and training services in the development of human resources (coaching). Bookkeeping. Performance of after-school educational activities: Organising training courses and seminars; and Organising training activities in sales, production and business support. Performance of training programmes in social services oriented to the performance of selected working activities and follow-up training. 14

17 A Branch of a Foreign Entity AGEL a.s. based at: Prostějov, Mathonova 291/1, Postcode: , Identification No.: Advertising and marketing services: Production, processing and distribution of advertising material; Organising advertising campaigns; Distribution of advertisement using different channels (newspapers, periodicals, radio, television, the internet and other media) placing outdoor adverts billboards, panels, notice boards, stands (gluing, hanging ); Lease of advertising spaces; Arranging marketing campaigns; Point-of-sale marketing, marketing consulting services; and Advertising. Research and development in natural sciences. Research of the market and public opinion: identification of the market potential, degree of awareness, acceptation of and acquaintance with the goods and services, purchasing patterns of customers in order to promote sales and development of new goods and services, analyses of results. Head of the branch: MUDr. Milan Leckéši, residing at: Valašské Meziříčí, Třanovského 1331, Postcode: The head of the branch is entitled to take all and any legal acts relating to the branch on behalf of the foreign legal entity. When signing documents in the name of the foreign entity in the scope relating to the branch, the head of the brand attaches his signature to the printed or written commercial name of the foreign legal entity with the identification of the branch. Duration of the branch: The branch of the foreign legal entity with the commercial name AGEL a.s. branch, is established for an indefinite period of time, in accordance with the laws applicable in the Czech Republic. Founder and its legal form: AGEL a.s. Based at: Prostějov, Mathonova 291/1, Postcode: , Identification No.: , registered in the Commercial Register maintained by the Regional Court in Brno, Section B, Inset No

18 The auditor s Report

19 The auditor s Report

20 18 6.5

21 Financial Part I Financial Statements for the Year ended 31/12/ Balance Sheet Full Version 6.2. Profit and Loss Account 6.3. Statement of Changes in Equity 6.4. Cash Flow Statement 6.5. Footnotes to the Financial Statements for the Year Ended 31 December

22 Financial Part I Financial Statements for the Year ended 31/12/ FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2012 Name of the Company: Registered Office: Legal Status: AGEL a.s. Mathonova 291/1, Prostějov Joint Stock Company Corporate ID: Components of the Financial Statements: Balance Sheet Profit and Loss Account Statement of Changes in Equity Cash Flow Statement Notes to the Financial Statements These financial statements were prepared on 17 May Statutory body of the reporting entity Signature MUDr. Filip Horák, MBA Chairman of the Board of Directors Ing. Karel Kantor Vice-Chairman of the Board of Directors 20

23 Balance Sheet Full Version as of AGEL a.s.; Mathonova 291/1, Prostějov; Corporate ID (in CZK thousand) Gross Adjustment Net Net TOTAL ASSETS B. Fixed assets B.I. Intangible fixed assets B.I.1. Start-up costs B.I.3. Software B.I.4. Valuable rights B.I.6. Other intangible fixed assets B.I.7. Intangible fixed assets under construction B.II. Tangible fixed assets B.II.2. Structures B.II.3. Individual movable assets and sets of movable assets B.II.7. Tangible fixed assets under construction B.II.8. Prepayments for tangible fixed assets B.II.9. Valuation difference on acquired assets B.III. Non-current financial assets B.III.1. Equity investments subsidiary (controlled entity) B.III.2. Equity investments in associates B.III.5. Other non-current financial assets B.III.6. Acquisition of non-current financial assets C. Current assets C.II. Long-term receivables C.II.2. Receivables controlled or controlling entity C.II.5. Long-term prepayments made C.III. Short-term receivables C.III.1. Trade receivables C.III.2. Receivables controlled or controlling entity C.III.6. State tax receivables C.III.7. Short-term prepayments made

24 Balance Sheet Full Version as of Gross Adjustment Net Net C.III.8. Estimated receivables C.III.9. Other receivables C.IV. Current financial assets C.IV.1. Cash on hand C.IV.2. Cash at bank D. I. Other assets D.I.1. Deferred expenses D.I.3. Accrued income

25 Balance Sheet Full Version as of AGEL a.s.; Mathonova 291/1, Prostějov; Corporate ID (in CZK thousand) TOTAL LIABILITIES & EQUITY A. Equity A.I. Share capital A.I.1. Share capital A.II. Capital funds A.II.2. Other capital funds A.II.3. Gains or losses from the revaluation of assets and liabilities A.III. Statutory funds A.III.1. Statutory reserve fund/indivisible fund A.III.2. Statutory and other funds A.IV. Retained earnings A.IV.1. Accumulated profits brought forward A.V. Profit or loss for the current period (+ -) B. Liabilities B.II. Long-term liabilities B.II.9. Other payables B.II.10. Deferred tax liability B.III. Short-term liabilities B.III.1. Trade payables B.III.2. Payables controlled or controlling entity B.III.4. Payables to partners and association members B.III.5. Payables to employees B.III.6. Social security and health insurance payables B.III.7. State tax payables and subsidies B.III.10. Estimated payables B.III.11. Other payables B.IV. Bank loans and borrowings B.IV.1. Long-term bank loans B.IV.2. Short-term bank loans C. I. Other liabilities 233 C.I.2. Deferred income

26 Profit and Loss Account Year ended AGEL a.s.; Mathonova 291/1, Prostějov; Corporate ID (in CZK thousand) Year ended Year ended II. Production II.1. Sales of own products and services B. Purchased consumables and services B.1. Consumed material and energy B.2. Services Added value C. Staff costs C.1. Payroll costs C.2. Remuneration to members of statutory bodies C.3. Social security and health insurance costs C.4. Social costs D. Taxes and charges E. Depreciation of intangible and tangible fixed assets III. Sales of fixed assets and material III.1. Sales of fixed assets F. Net book value of fixed assets and material sold F.1. Net book value of sold fixed assets G. Change in reserves and provisions relating to operating activities and complex deferred expenses IV. Other operating income H. Other operating expenses * Operating profit or loss VI. Proceeds from the sale of securities and investments J. Cost of securities and investments sold VII. Income from non-current financial assets VII.1. Income from equity investments in subsidiaries and associates X. Interest income N. Interest expenses XI. Other financial income

27 Profit and Loss Account Year ended Year ended Year ended O. Other financial expenses * Financial profit or loss Q. Income tax on ordinary activities Q 1. due Q 2. deferred ** Profit or loss from ordinary activities *** Profit or loss for the current period (+/-) **** Profit or loss before tax

28 Statement of Changes in Equity Year ended AGEL a.s.; Mathonova 291/1, Prostějov; Corporate ID (in CZK thousand) Share capital Capital funds Statutory funds Accumulated profits brought forward Accumulated losses brought forward Profit or loss for the current period TOTAL EQUITY Balance at 31 December IKIS merger impact Balance at 1 January Distribution of profit or loss Dividends and directors' fees paid Revaluation gain or loss on financial investments Payments from other funds Profit or loss for the current period Balance at 31 December Distribution of profit or loss Dividends and directors' fees paid Revaluation gain or loss on financial investments Gifts received Payments from other funds Profit or loss for the current period Balance at 31 December

29 Cash Flow Statement Year ended AGEL a.s.; Mathonova 291/1, Prostějov; Corporate ID (in CZK thousand) Year ended Year ended P. Opening balance of cash and cash equivalents Cash flows from ordinary activities Z. Profit or loss from ordinary activities before tax A.1. Adjustments for non-cash transactions A.1.1. Depreciation of fixed assets A.1.2. Change in provisions and reserves A.1.3. Profit/(loss) on the sale of fixed assets A.1.4. Revenues from dividends and profit shares A.1.5. Interest expense and interest income A.* Net operating cash flow before changes in working capital A.2. Change in working capital A.2.1. Change in operating receivables and other assets A.2.2. Change in operating payables and other liabilities A.** Net cash flow from operations before tax and extraordinary items A.3. Interest paid A.4. Interest received A.5. Income tax paid from ordinary operations A.7. Received dividends and profit shares A.*** Net operating cash flows Cash flows from investing activities B.1. Fixed assets expenditures B.2. Proceeds from fixed assets sold B.3. Loans provided to related parties B.*** Net investment cash flows Cash flow from financial activities C.1. Change in payables from financing C.2. Impact of changes in equity C.2.5. Payments from capital funds C.2.6. Dividends paid C.*** Net financial cash flows F. Net increase or decrease in cash and cash equivalents R. Closing balance of cash and cash equivalents

30 Footnotes to the Financial Statements for the Year Ended 31 December Name of the Company: Registered Office: Legal Status: AGEL a.s. Mathonova 291/1, Prostějov Joint Stock Company Corporate ID: GENERAL INFORMATION Incorporation and Description of the Business Year-on-Year Changes and Amendments to the Register of Companies Organisational Structure Board of Directors and Supervisory Board Group Identification BASIS OF ACCOUNTING AND GENERAL ACCOUNTING PRINCIPLES Tangible and Intangible Fixed Assets Financial Assets Receivables Payables Reserves Loans Taxation Foreign Currency Translation Finance Leases Revenue Recognition Use of Estimates Year-on-Year Changes in Valuation, Depreciation or Accounting Policies Group VAT registration Organisational Branch of AGEL a.s Cash Flow Statement

31 Footnotes to the Financial Statements for the Year Ended 31 December ADDITIONAL INFORMATION Intangible Fixed Assets (Intangible FA) Tangible Fixed Assets (Tangible FA) Assets Held under Finance Leases Non-Current Financial Assets Long-Term Receivables Short-Term Receivables Estimated Receivables Deferred Expenses Equity Long-Term Payables Short-Term Payables Estimated Payables Bank Loans Deferred Income Tax Income from Ordinary Activities Services Employees, Management and Statutory Bodies Taxes and Fees Operating Income and Expenses Financial Income and Expenses Related Party Transactions Off Balance Sheet Commitments Post Balance Sheet Events

32 Footnotes to the Financial Statements for the Year Ended 31 December GENERAL INFORMATION 1.1. Incorporation and Description of the Business AGEL a.s. (hereinafter the Company ) was formed by a Memorandum of Association on 14 May 1990 and was entered in the Register of Companies on 14 June The General Meeting held on 25 March 2003 decided to change the legal status of the Company from AGEL s.r.o. (limited liability company) to AGEL a.s. (joint stock company). This change was entered in Section B, Insert 3941 of the Register of Companies held by the Regional Court in Brno on 15 August Due to the change of its registered office, the Company was registered in the Register of Companies held by the Regional Court in Ostrava, Section B, Insert 2892, from 26 April 2005 to 13 July Given the change in its registered office in 2009 to Mathonova 291/1, Prostějov, the Company has been registered in the Register of Companies of the Regional Court in Brno, File B, insert The activities of the Company include production, trade and services. The following table shows individuals and legal entities and the amount of their equity interest: Shareholder/owner Ownership percentage Ing. Tomáš Chrenek, Ph.D. 75 MUDr. Martin Polach, MBA 25 Celkem Year-on-Year Changes and Amendments to the Register of Companies No changes were made to the Company s corporate details held at the Register of Companies Organisational Structure The Company s organisational structure is provided in Appendix 1 hereto. As of 21 September 2011, the Company formed an organisational branch in Slovakia and the financial statements include consolidated figures for both parts of the Company, refer to Note

33 Footnotes to the Financial Statements for the Year Ended 31 December Board of Directors and Supervisory Board Board of Directors Supervisory Board Position Chairman Vice-Chairman Vice-Chairman Member Member Member Chairman Vice-Chairman Member Member Member Member Name MUDr. Filip Horák, MBA Ing. Karel Kantor MUDr. Milan Leckéši Ing. Roman Gavanda Ing. Iveta Ostruszková, MBA Mgr. Libor Vrba Ing. Tomáš Chrenek, Ph.D. MUDr. Martin Polach, MBA MUDr. Dana Polachová PhDr. Dušana Chreneková, MBA Eng. David Hercky, MBA Hana Tůmová 1.5. Group Identification The Company is the parent company of the AGEL group. The structure of the consolidation group is described in Appendix 2 to these notes. 31

34 Footnotes to the Financial Statements for the Year Ended 31 December BASIS OF ACCOUNTING AND GENERAL ACCOUNTING PRINCIPLES The Company s accounting books and records are maintained and the financial statements were prepared in accordance with the Accounting Act 563/1991 Coll., as amended; the Regulation 500/2002 Coll. which provides implementation guidance on certain provisions of the Accounting Act for reporting entities that are businesses maintaining double-entry accounting records, as amended, and Czech Accounting Standards for Businesses, as amended. The accounting records are maintained in compliance with general accounting principles, specifically the historical cost valuation basis, the accruals principle, the prudence concept, and the going concern assumption. The Company s financial statements have been presented as of the balance sheet date, ie 31 December These financial statements are presented in thousands of Czech crowns ( CZK thousand ), unless stated otherwise Tangible and Intangible Fixed Assets Fixed assets include assets with an estimated useful life greater than one year and an acquisition cost greater than CZK 40 thousand in respect of tangible assets, and CZK 60 thousand in respect of intangible assets, on an individual basis. Fixed assets include assets with the cost between CZK 10 thousand and CZK 40 thousand if they have the characteristics of fixed assets and their useful life exceeds one year. Purchased tangible and intangible fixed assets are stated at cost less accumulated depreciation and provisions, if any. The valuation differences on acquired assets arose from the demerger of Nemocnice Podlesí a.s. through spin-off of part of its net assets and the amalgamation of this part with Agel a.s. and are depreciated on a straight line basis over 180 months. Assets acquired through purchase after the expiration of the lease contract are stated at replacement cost. The cost of fixed asset improvements exceeding CZK 40 thousand for individual tangible assets and intangible assets for the taxation period, increases the acquisition cost of the related fixed asset. Depreciation is charged so as to write off the cost of tangible and intangible fixed assets, other than land and assets under construction, over their estimated useful lives on the following basis: Type of assets Depreciation method Number of years Software Straight line 3 Office and copying technology Straight line 3 32

35 Footnotes to the Financial Statements for the Year Ended 31 December Type of assets Depreciation method Number of years Vehicles Straight line 5 Constructions Straight line 30 Furniture and fixtures Straight line 5 Low value fixed assets Straight line Financial Assets Financial assets with maturity or intent to hold exceeding one year are reported as non-current; financial assets with maturity or intent to hold up to one year are considered current. Valuation of Financial Assets upon Acquisition Upon acquisition, investments, securities and derivatives are stated at cost including the share premium and indirect acquisition costs. Valuation of Financial Assets at the Balance Sheet Date Equity investments in subsidiaries or associates are stated using the equity method of accounting (share of equity of the owned company). Other equity investments are stated at cost less provisions Receivables Upon origination, receivables are stated at their nominal value as subsequently reduced by provisions, if any. Long-term receivables are receivables with maturities exceeding one year at the financial statements date and a deferred tax asset. Short-term receivables are receivables with maturities of one year and shorter as of the financial statements date. Provisioning Provisions against receivables are recognised on the basis of an assessment of their maturity. Receivables past due for more than 180 days are provided for at 50 percent of their carrying amount while receivables past due by more than 365 days are provided for in full Payables Payables are stated at their nominal value. Long-term payables are payables with maturities exceeding one year at the financial statements date and a deferred tax liability. Short-term payables are due within one year. 33

36 Footnotes to the Financial Statements for the Year Ended 31 December Reserves Reserves are intended to cover future risks and expenditure the nature of which is clearly defined and which are likely to be incurred but uncertain as to their amount or as to the date on which they will arise. Reserves are recognised and accounted for through expenses predominantly for potential risks arising from legal disputes as equal to the risk exposure based on the consultation with legal counsel Loans Loans are stated at their nominal value. Short-term loans are loans repayable within one year from the date of their origination. The portion of long-term loans maturing within one year from the balance sheet date is included in short-term loans. Interest on loans is charged to expenses in accordance with the accruals principle Taxation Depreciation of Fixed Assets for Tax Purposes Depreciation of tangible fixed assets is calculated using the accelerated method for tax purposes. Intangible fixed assets are amortised for tax purposes in accordance with Section 32a of the Income Taxes Act. Current Tax Payable The tax liability for the year ended 31 December 2012 was calculated based on tax calculation which follows from its understanding of the interpretation of Czech tax legislation valid at the financial statements date and believes that the amount of tax is correct in compliance with the effective Czech tax regulations. Since various interpretations of tax laws and regulations by third parties, including state administrative bodies, exist, the income tax payable reported in the Company s financial statements may change based on the ultimate opinion of the tax authorities. Deferred Tax Deferred tax is accounted for using the balance sheet liability method Foreign Currency Translation Transactions denominated in foreign currencies during the year are translated using the exchange rate of the Czech National Bank prevailing on the date of the transaction. At the balance sheet date, the relevant assets and liabilities are translated at the Czech National Bank s exchange rate prevailing as of that date. 34

37 Footnotes to the Financial Statements for the Year Ended 31 December Finance Leases A finance lease is the acquisition of a tangible fixed asset such that, over or after the contractual lease term, ownership title to the asset transfers from the lessor to the lessee; pending the transfer of title the lessee makes lease payments to the lessor for the asset that are charged to expenses. The initial lump-sum payment related to assets acquired under finance leases is amortised and expensed over the lease period Revenue Recognition Revenues from management activities (which are invoiced on an upfront payment basis during the year) are recognised monthly always as of the last day in the month as an estimated item. The final amount of the remuneration for provided services is determined and recognised based on the actual supporting documentation identified in the accounting records as of the date of the final version of the financial statements for the calendar year. Other revenues are recognised when the service is rendered (accounting transaction realised) always in the period to which the revenue relates on an accrual basis. Dividend income from investments is recognised when the shareholders rights to receive payment have been established Use of Estimates The presentation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the balance sheet date and the reported amounts of revenues and expenses during the reporting period. Management of the Company has made these estimates and assumptions on the basis of all the relevant information available to it. Nevertheless, pursuant to the nature of estimates, the actual results and outcomes in the future may differ from these estimates Year-on-Year Changes in Valuation, Depreciation or Accounting Policies There were no year-on-year changes in the valuation or accounting policies in the year ended 31 December Group VAT registration With effect from 1 January 2009, the AGEL group has been registered as a VAT payer in terms of Section 95a of Act No. 235/2004 Coll. on Value Added Tax. AGEL a.s. is the representative member of the group. The group is registered under tax ID CZ Members of the VAT group registration: P&R LAB a.s., Repharm, a.s., Nemocnice Nový Jičín a.s., Nemocnice Český Těšín a.s., Transfúzní služba a.s., Nemocnice Valašské Meziříčí a.s., Středomoravská nemocniční a.s., 35

38 Footnotes to the Financial Statements for the Year Ended 31 December Podhorská nemocnice a.s., MARTEK MEDICAL a.s., Šumperská nemocnice a.s., Nemocnice Podlesí a.s., Vítkovická nemocnice a.s., ZENAGEL a.s., 1.Oční s.r.o., Dopravní zdravotnictví a.s. and Medical Systems a.s. New members of the VAT group registration as of 1 January 2012: Kardiologické centrum AGEL s.r.o. As a result of the group VAT registration, the Company reports a receivable (payable) arising from VAT on behalf of the entire registered group. Relations arising from VAT between the representative member of the group (AGEL a.s.) and other members of the registered group are reported under Receivables controlling entity or Payables controlling entity as appropriate Organisational Branch of AGEL a.s. Pursuant to the resolution of the General Meeting dated 16 August 2011, an organisational branch of AGEL with its registered office at Prepoštská 2088/6, Bratislava was formed. Milan Leckéši was appointed as the head of the organisational branch. The Company provides management for members of the group in Slovakia through the Slovak branch Cash Flow Statement The cash flow statement is prepared using the indirect method. Cash equivalents include current liquid assets easily convertible into cash in an amount agreed in advance. Cash and cash equivalents can be analysed as follows: (CZK 000) Cash on hand Cash equivalents Current bank accounts and cash in transit Term deposits 0 0 Deposit bills of exchange 0 0 Total cash and cash equivalents Cash flows from operating, investment and financial activities presented in the cash flow statement are not offset. 36

39 Footnotes to the Financial Statements for the Year Ended 31 December ADDITIONAL INFORMATION 3.1. Intangible Fixed Assets (Intangible FA) Major additions to intangible FA include (stated at cost): (CZK 000) Item/type of asset Software Other tangible fixed assets Total Tangible Fixed Assets (Tangible FA) Major additions to tangible FA include (stated at cost): (CZK 000) Item/type of asset Constructions 0 71 Machinery and equipment Vehicles Furniture and fixtures Total Major disposals of tangible FA include (stated at net book value upon disposal): (CZK 000) Item/type of asset Machinery and equipment Vehicles Furniture and fixtures Total

40 Footnotes to the Financial Statements for the Year Ended 31 December As of 31 December 2012 (2011), the Company records low value tangible assets of CZK 1,926 thousand (CZK 1,738 thousand) reported off balance sheet. These assets include low value tangible assets which are other movable assets and sets of movable assets with useful lives exceeding one year not reported in fixed assets. These assets are recognised in expenses Assets Held under Finance Leases (CZK 000) Description Total lease value Payments made at 31 Dec 2011 Payments made at 31 Dec 2012 Due in 2013 Due in the following years Vehicles Total Non-Current Financial Assets Equity investments in subsidiaries: Year Ended 31 December 2012 (CZK 000) Name of the entity Registered office Cost Equity Profit or loss Carrying value AGEL POLSKA SA Warszawa AGEL SK a.s. Bratislava Dopravní zdravotnictví a.s. Praha Kardiologické centrum AGEL s.r.o. Pardubice MARTEK MEDICAL a.s. Třinec Medical Systems a.s. Prostějov Nemocnice Český Těšín a.s. Český Těšín Nemocnice Podlesí a.s. Třinec Nemocnice Valašské Meziříčí a.s. Valašské Meziříčí P&R LAB a.s. Nový Jičín Podhorská nemocnice a.s. Rýmařov Oční s.r.o. Ostrava Nemocnice Nový Jičín a.s. Nový Jičín Repharm, a.s. Třinec

41 Footnotes to the Financial Statements for the Year Ended 31 December Name of the entity Registered office Cost Equity Profit or loss Carrying value Středomoravská nemocniční a.s. Prostějov Šumperská nemocnice a.s. Šumperk Transfúzní služba a.s. Šumperk Vítkovická nemocnice a.s. Ostrava ZENAGEL a.s. Ostrava AGEL SERVIS a.s. Prostějov IVF Clinic a.s. Prostějov Avenier, a.s. Brno KTR Servis s.r.o. Ostrava Total Note: The Company holds the 100% equity investment in all entities in the table except for: Kardiologické centrum AGEL s.r.o. 90%, IVF Clinic a.s %, and Avenier, a.s. 80 %. Year Ended 31 December 2011 (CZK 000) Name of the entity Registered office Cost Equity Profit or loss Carrying value AGEL POLSKA SA Warszawa AGEL SK a.s. Bratislava Dopravní zdravotnictví a.s. Praha Kardiologické centrum AGEL s.r.o. Pardubice MARTEK MEDICAL a.s. Třinec Medical Systems a.s. Prostějov Nemocnice Český Těšín a.s. Český Těšín Nemocnice Podlesí a.s. Třinec Nemocnice Valašské Meziříčí a.s. Valašské Meziříčí P&R LAB a.s. Nový Jičín Podhorská nemocnice a.s. Rýmařov Oční s.r.o. Ostrava Radioterapie, a.s. Nový Jičín

42 Footnotes to the Financial Statements for the Year Ended 31 December Name of the entity Registered office Cost Equity Profit or loss Carrying value Repharm, a.s. Třinec Středomoravská nemocniční a.s. Prostějov Šumperská nemocnice a.s. Šumperk Transfúzní služba a.s. Šumperk Vítkovická nemocnice a.s. Ostrava ZENAGEL a.s. Ostrava Celkem Note: The Company wholly owns all the entities listed in the table. Equity investments in associates: Year Ended 31 December 2012 (CZK 000) Name of the entity Registered office Ownership percentage Cost Equity Profit or loss Carrying value Hornická poliklinika s.r.o. Ostrava 48, Total Year Ended 31 December 2011 (CZK 000) Name of the entity Registered office Ownership percentage Cost Equity Profit or loss Carrying value Hornická poliklinika s.r.o. Ostrava 48, Total Long-Term Receivables As of 31 December 2012 (31 December 2011), the Company reports receivables controlled or controlling entity of CZK 17,648 thousand (CZK 31,115 thousand) arising from a provided loan. 40