CONSOLIDATED FINANCIAL STATEMENT OF ZPUE S.A. CAPITAL GROUP FOR THE 4TH QUARTER OF 2010

Transcription

1 CONSOLIDATED FINANCIAL STATEMENT OF ZPUE S.A. CAPITAL GROUP FOR THE 4TH QUARTER OF 2010 WŁOSZCZOWA, MARCH 2011

2 LIST OF CONTENTS 1. Condensed Consolidated Financial Statement for the 4th Quarter of Selected financial data (thousands) 1.2 The exchange rates used to convert the Selected financial data. 1.3 Consolidated balance sheet 1.4 Consolidated profit and loss account 1.5 Consolidated statement of changes in equity 1.6 Consolidated cash flow account 2. Condensed Financial Statement of ZPUE S.A. 2.1 Selected financial data (thousands) 2.2 The exchange rates used to convert the Selected financial data. 2.3 Balance 2.4 Profit and loss account 2.5 Statement of changes in equity 2.6 Cash flow account 2.7 Differences arising from the conversion of ZPUE S.A. statements to IAS 3. Commentary and additional information to the Consolidated Financial Statement for the 4th Quarter of Basic information about the Company, area of business 3.2 Scope of the Consolidated Financial Statement presented 3.3 Information about entities covered by consolidation 3.4 Methods of preparing Financial Statements 3.5 Characteristics of the major principles and methods used by the Company for evaluating assets and liabilities and establishing the financial result 3.6 Adjustments for reserves, reserves from deferred income tax and impairment loss write offs on the value of assets 3.7 A concise description of the issuer s achievements or setbacks during the period, to which the statement refers to, with a list of the most significant events associated with them. 3.8 Factors and events during the period, particularly atypical ones, significantly affecting the financial results achieved 3.9 Segments of operational activity 3.10 Clarifications referring to seasons or cycles in the issuer s business during the presented period Information concerning issues, purchases and payments of non-share and capital securities 3.12 Information concerning executed (or announced) dividend payout, jointly and calculated per share, divided into ordinary and preference shares Events which took place following the date on which the Summarised Quarterly Financial Statement was drawn up and not included in that statement, which could significantly affect the Issuer s future financial results 3.14 Changes in contingent liabilities or contingent assets, which occurred after the last financial year 3.15 List of the effects of changes to the structure of the business entity, including business entities consolidation, take over or sale of the capital group s entities, long-term investments, division, restructure and ceasing business operations The position of the Board concerning the possibility of meeting the previously released, current year s profit forecasts early, in the light of results presented in the quarterly statement in relation to forecast profits Shareholders who either directly or indirectly own in excess of 5% of the overall number of votes at the GM of ZPUE SA as of the date of passing the quarterly report, together with the number of shares owned by those entities, their percentage share in the capital, number of votes from these at the annual general meeting and their percentage share in the total number of votes at the GM, as well as a list of the changes to the ownership structure of significant issuer s share packages during the period since the last quarterly report was passed A statement of changes in the ownership of issuer s shares or right to them (options) by issuer s management and persons in supervisory positions as per issuer s information up to the time of passing the previous quarterly statement Information on legal proceedings before a court, authority respective for arbitrage proceedings or a public administration authority Information on the transactions entered into by the Issuer or its subsidiary with affiliated companies, if these transactions individually or collectively are significant and were made on conditions other than market conditions, with indication of their value, with the reservation that information on individual 2

3 transactions can be grouped by type except when information on individual transactions is required to understand how they affect the issuer's assets, financial standing and the financial result Information concerning a loan or credit surety or guarantee issued by the Issuer or the Issuer s subsidiary company overall to a single entity or their subsidiary company, if the total value of the existing sureties or guaranty constitutes in excess of 10% of the Issuer s equity capital Other information, which in the Issuer's opinion is important to assess its human resources, property, finances, financial result and their changes as well as information, which is crucial in the assessment of the Issuer's ability to fulfil its obligations Factors, which in the Issuer s opinion will affect the results achieved by them in view of the next quarter or longer 3.24 In the event that the condensed financial statement was examined by an entity authorised to examine financial statements, the quarterly report contains the relevant opinion on the examination or a report into the review of the condensed financial statement 3

4 1. Condensed Consolidated Financial Statement for the 4th Quarter of Consolidated Selected Financial Data thousands PLN thousands EUR CONSOLIDATED SELECTED FINANCIAL DATA period from to period from to I. Net revenue from sales of products, goods and material II. Profit (loss) on operating activities III. Gross profit (loss) IV. Net profit (loss) V. Net cash flows from operating activities VI. Net cash flows from investment activities VII. Net cash flows from financial activities VIII. Total net cash flows IX. Total assets X. Liabilities and reserves for liabilities XI. Long term liabilities XII. Short-term liabilities XIII. Equity capital XIV. Share capital XV. Number of shares XVI. Profit (loss) per ordinary share (PLN / EUR) 14,21 3,55 XVII. Diluted profit (loss) per ordinary share (PLN / EUR) 14,21 3,55 XVIII. Book value per share (PLN/EUR) 120,41 30,40 XIX. Diluted book value per share (PLN/EUR) 120,41 30,40 XX. Declared or paid dividend per share (PLN / EUR) The exchange rates used to convert the Selected financial data. Selected financial data included in the financial statement for the 4th quarter of 2010 was calculated according to the following PLN/EUR exchange rates: - individual balance sheet assets and liabilities calculated according to the average EUR rate applicable on 31 December 2010, as set by the National Bank of Poland, i.e PLN and on 31 December PLN. - individual items on the profit and loss account and cash flow account converted to EUR according to the rate which was the arithmetical average of the average rates set by the National Bank of Poland and applicable on the last day of each turnover month: - for the period January - December PLN. - for the period January - December PLN. EUR rate for calculating Balance Sheet items: NBPaverage EUR rate on Table 255/A/NBP/ PLN NBPaverage EUR rate on Table 255/A/NBP/ PLN 4

5 Arithmetical average of average NBP EUR rates for the period Table number Date Rate 20/A/NBP/ , /A/NBP/ , /A/NBP/ , /A/NBP/ , /A/NBP/ , /A/NBP/ , /A/NBP/ , /A/NBP/ , /A/NBP/ , /A/NBP/ , /A/NBP/ , /A/NBP/ ,9603 Average rate for 12 months of ,0044 Arithmetical average of average NBP EUR rates for the period Table number Date Rate 21/A/NBP/ , /A/NBP/ , /A/NBP/ , /A/NBP/ , /A/NBP/ , /A/NBP/ , /A/NBP/ , /A/NBP/ , /A/NBP/ , /A/NBP/ , /A/NBP/ , /A/NBP/ ,1082 Average rate for 12 months of ,3406 5

6 1.3 Consolidated balance sheet of ZPUE S.A Capital Group [in thous. PLN] A. Fixed assets I Intangible assets Cost of completed development work Goodwill Other intangible assets Advance payments for intangible assets II. Property, plant and equipment Fixed assets a) land (perpetual usufruct right to the land) b) buildings, commercial premises and civil engineering facilities c) equipment and machinery d) means of transport e) other fixed assets Fixed assets under construction Advance payments for fixed assets under construction III. Long-term receivables From subsidiaries and affiliates From other entities IV. Long-term investments Real estate Intangible assets Long-term financial assets a) in subsidiaries and affiliates shares other securities granted loans other long-term financial assets b) in other entities shares other securities granted loans other long-term financial assets Other long-term investments V. Long-term deferred charges and accruals Assets from deferred taxes Other deferred charges and accruals B. Current assets I. Inventory Materials Semi-finished products and work in progress Finished products Goods Advance payments for deliveries II. Short-term receivables Receivables from subsidiaries and affiliates a) for deliveries and services, maturing within: up to 12 months in excess of 12 months b) others Receivables from other entities

7 a) for deliveries and services, maturing within: up to 12 months in excess of 12 months b) from tax, subsidy, customs, social security and other benefits c) others d) claimed in court III. Short-term investments Short-term financial assets a) in subsidiaries and affiliates shares other securities granted loans other long-term financial assets b) in other entities shares other securities granted loans other long-term financial assets c) cash and other cash assets cash in hand and at bank other cash other pecuniary assets Other short-term investments IV. Short-term deferred charges and accruals Total assets Liabilities A. Equity capital I. Stated capital (fund) II. Called up stated capital (negative value) III. Own shares for sale (negative value) IV. Supplementary capital (fund) V. Revaluation reserve capital (fund) VI. Other reserve capital (fund) VII. Profit (loss) from previous years VIII. Net profit (loss) Write-offs on net profit during the financial year (negative IX. value) X. Minority shareholders capital B. Liabilities and reserves for liabilities I. Reserves for liabilities Reserves for deferred income tax Social security reserves long-term short-term Other reserves long-term short-term II. Long term liabilities To subsidiaries and affiliates To others a) credits and loans b) issuance of debt securities c) other financial liabilities

8 d) others III. Short-term liabilities To subsidiaries and affiliates a) for deliveries and services, maturing within: up to 12 months in excess of 12 months b) others To others a) credits and loans b) issuance of debt securities c) other financial liabilities d) for deliveries and services, maturing within: up to 12 months in excess of 12 months e) received advance payments for deliveries f) liabilities on bills of exchange g) from tax, customs, social security and other benefits h) from remuneration i) others Special funds IV. Accruals and deferred income Negative goodwill Other deferred charges and accruals long-term short-term Total liabilities Consolidated profit and loss account of ZPUE S.A Capital Group [in thous. PLN] from to from to from to from to A. Net revenue from sales of products, goods and materials, including: from subsidiaries and affiliates I. Net revenue from sale of products II. Net revenue from sales of products, goods and materials B. Cost of products, goods and materials sold, including: to subsidiaries and affiliates I. Cost of producing goods sold II. Cost of goods and materials sold C. Gross profit (loss) on sales D. Cost of sales E. General administrative expenses F. Profit (loss) on sales G. Other operating revenue I. Profit on sales of non-financial fixed assets II. Subsidies III. Other operating revenue H. Other operating costs I. Loss on sales of non-financial fixed assets II. Revaluation of non-financial fixed assets

9 III. Other operating costs I. Profit (loss) on operating activities J. Financial revenue I. Share dividends, including: from subsidiaries and affiliates II. Interest, including: from subsidiaries and affiliates III. Profit on sale of investments IV. Gain on revaluation of investments V. Others K. Financial costs I. Interest, including: from subsidiaries and affiliates II. Loss on sale of investments III. Gain on revaluation of investments IV. Others L. Profit (loss) on commercial activities M. Result of extraordinary events I. Extraordinary profits II. Extraordinary losses N. Gross profit (loss) O. Income tax P. Other obligatory decrease of gross profit (increased loss) R. Net profit (loss) Financial result allocated to minority shareholders Financial result allocated to the group Statement of changes in equity of ZPUE S.A Capital Group [in thous. PLN] from to from to from to from to I. Opening balance of equity (BO) valuation adjustments I. a Opening balance of equity capital (fund) (BO), adjusted Opening balance of stated capital (fund) Changes in stated capital (fund) a) increase (due to) share issue (stock issue) increase in capital from net profit b) decrease (due to) redemption of shares Closing balance of stated capital (fund) Opening balance of called up stated capital Change in called up stated capital a) increase (due to) b) decrease (due to) Closing balance of called up stated capital Opening balance of own shares a) increase

10 b) decrease Closing balance of own shares Opening balance of supplementary capital (fund) Changes in supplementary capital (fund) a) increase (due to) issue of shares above face value from profit distribution (statutory) from profit distribution (above the statutory value) b) decrease (due to) loss coverage Closing balance of supplementary capital (fund) Opening balance of revaluation reserve capital (fund) Changes in revaluation reserve capital (fund) a) increase (due to) b) decrease (due to) disposal of property, plant and equipment Closing balance of revaluation reserve capital (fund) Opening balance of other reserve capitals (funds) Changes in other reserve capitals (funds) a) increase (due to) b) decrease (due to) Closing balance of other reserve capitals (funds) Opening balance of Minority capital Changes in capital increase decrease Minority capital at end of year Opening balance of previous years' profit (loss) Opening balance of previous years' profit adjustments of fundamental errors Opening balance of previous years' profit after adjustments a) increase (due to) distribution of previous years profit revaluation of fixed assets b) decrease from/of profit division Closing balance of previous years' profit Opening balance of previous years' loss adjustments of fundamental errors Opening balance of previous years' loss after adjustments a) increase (due to) re-booking of previous years' loss to be covered b) decrease (due to) Closing balance of previous years' loss Closing balance of previous years' profit (loss) Net profit a) net profit b) net loss c) write-offs on profit

11 II. Closing balance of equity (BZ) III. Equity (fund) including proposed profit distribution (loss coverage) Consolidated cash flow account of ZPUE S.A Capital Group [in thous. PLN] from to from to from to from to Cash flows from operating activities - indirect A. method I. Gross profit (loss) II. Total adjustments Profit (loss) of minority shareholders Shares in net profit (loss) of subsidiaries and affiliates consolidated by equity method Depreciation Write off of goodwill on consolidation or write off of reserve capital on consolidation Exchange gains (losses) Interest and profit sharing (dividend) Profit (loss) on investment activities Change in reserves Change in inventory Change in receivables Change in short-term liabilities excluding credits and loans Change in prepayments and accruals Income tax paid Other adjustments III. Net cash flows from operating activities B. Cash flows from investment activities I. Inflows Disposal of intangible and property, plant and equipment Disposal of investments in real property and in intangible assets From financial assets, including: a) in subsidiaries and affiliates sale of financial assets dividend and profit sharing repayment of long-term loans interest other inflows from financial assets b) in other entities sale of financial assets dividend and profit sharing repayment of long-term loans interest other inflows from financial assets Other inflows from investment activities II. Outflows Acquisition of intangible and property, plant and equipment

12 2. Investments in real property and in intangible assets For financial assets, including: a) in subsidiaries and affiliates acquisition of financial assets granted long-term loans b) in other entities acquisition of financial assets granted long-term loans Other outflows from investment activities III. Net cash flows from investment activities (I-II) C. Cash flows from financial activities I. Inflows Net inflows from issuance of shares and other capital instruments and from capital contributions Credits and loans Issuance of debt securities Other inflows from financial activities II. Outflows Purchase of own shares Dividends and other payments to shareholders Profit distribution liabilities other than profit distribution payments to shareholders Repayment of credits and loans Redemption of debt securities From other financial liabilities Payment of liabilities arising from financial leases Interest Other outflows from financial activities III. Net cash flows from financial activities D. Total net cash flows E. Balance sheet change in cash, including: change in cash due to exchange rate differences F. Cash opening balance G. Closing balance of cash, including: Condensed Financial Statement of ZPUE S.A. 2.1 Selected Financial Data SELECTED FINANCIAL DATA from to thousands PLN from to thousands EUR from to from to I. Net revenue from sales of products, goods and material II. Profit (loss) on operating activities III. Gross profit (loss) IV. Net profit (loss) V. Net cash flows from operating activities VI. Net cash flows from investment activities VII. Net cash flows from financial activities VIII. Total net cash flows

13 IX. Total assets X. Liabilities and reserves for liabilities XI. Long term liabilities XII. Short-term liabilities XIII. Equity capital XIV. Share capital XV. Number of shares XVI. Profit (loss) per ordinary share (PLN / EUR) 13,98 9,47 3,49 2,18 XVII. Diluted profit (loss) per ordinary share (PLN / EUR) 13,98 9,47 3,49 2,18 XVIII. Book value per share (PLN/EUR) 120,17 105,69 30,34 25,73 XIX. Diluted book value per share (PLN/EUR) 120,17 105,69 30,34 25,73 XX. Declared or paid dividend per share (PLN / EUR) The exchange rates used to convert the Selected Financial Data. The selected financial data was calculated according to the rates indicated in pt. 1.2 of the present statement. 2.3 Balance sheet - Statement of the financial standing of ZPUE S.A. [in thous. PLN] Assets A. Fixed assets I. Intangible assets Cost of completed development work Goodwill Other intangible assets Advance payments for intangible assets II. Property, plant and equipment Fixed assets a) land (perpetual usufruct right to the land) b) buildings, commercial premises and civil engineering facilities c) equipment and machinery d) means of transport e) other fixed assets Fixed assets under construction Advance payments for fixed assets under construction III. Long-term receivables From subsidiaries and affiliates From other entities IV. Long-term investments Real estate Intangible assets Long-term financial assets a) in subsidiaries and affiliates shares other securities granted loans other long-term financial assets

14 b) in other entities shares other securities granted loans other long-term financial assets Other long-term investments V. Long-term deferred charges and accruals Assets from deferred taxes Other deferred charges and accruals B. Current assets I. Inventory Materials Semi-finished products and work in progress Finished products Goods Advance payments for deliveries II. Short-term receivables Receivables from subsidiaries and affiliates a) for deliveries and services, maturing within: up to 12 months in excess of 12 months b) others Receivables from other entities a) for deliveries and services, maturing within: up to 12 months in excess of 12 months b) from tax, subsidy, customs, social security c) others d) claimed in court III. Short-term investments Short-term financial assets a) in subsidiaries and affiliates shares other securities granted loans other long-term financial assets b) in other entities shares other securities granted loans other long-term financial assets c) cash and other cash assets cash in hand and at bank other cash other pecuniary assets Other short-term investments IV. Short-term deferred charges and accruals Total assets Liabilities A. Equity capital I. Stated capital (fund)

15 II. Called up stated capital (negative value) III. Own shares for sale (negative value) IV. Supplementary capital (fund) V. Revaluation reserve capital (fund) VI. Other reserve capital (fund) VII. Profit (loss) from previous years VIII. Net profit (loss) Write-offs on net profit during the financial year (negative IX. value) B. Liabilities and reserves for liabilities I. Reserves for liabilities Reserves for deferred income tax Social security reserves long-term short-term Other reserves long-term short-term II. Long term liabilities To subsidiaries and affiliates To others a) credits and loans b) issuance of debt securities c) other financial liabilities d) others III. Short-term liabilities To subsidiaries and affiliates a) for deliveries and services, maturing within: up to 12 months in excess of 12 months b) others To others a) credits and loans b) issuance of debt securities c) other financial liabilities d) for deliveries and services, maturing within: up to 12 months in excess of 12 months e) received advance payments for deliveries f) liabilities on bills of exchange g) from tax, customs, social security and other benefits h) from remuneration i) others Special funds IV. Accruals and deferred income Negative goodwill Other deferred charges and accruals long-term short-term Total liabilities

16 2.4 Profit and loss account - Statement of the total income of ZPUE S.A [in thous. PLN] from to from to from to from to A. Net revenue from sales of products, goods and materials, including: from subsidiaries and affiliates I. Net revenue from sale of products Net revenue from sales of products, goods and II. materials B. Cost of products, goods and materials sold, including: to subsidiaries and affiliates I. Cost of producing goods sold II. Cost of goods and materials sold C. Gross profit (loss) on sales D. Cost of sales E. General administrative expenses F. Profit (loss) on sales G. Other operating revenue, including: I. Profit on sales of non-financial fixed assets II. Subsidies III. Other operating revenue H. Other operating costs, including: I. Loss on sales of non-financial fixed assets II. Revaluation of non-financial fixed assets III. Other operating costs I. Profit (loss) on operating activities J. Financial revenue, including I. Share dividends, including: from subsidiaries and affiliates II. Interest, including: from subsidiaries and affiliates III. Profit on sale of investments IV. Gain on revaluation of investments V. Others K. Financial costs, including: I. Interest, including: from subsidiaries and affiliates II. Loss on sale of investments III. Gain on revaluation of investments IV. Others L. Profit (loss) on commercial activities M. Result of extraordinary events I. Extraordinary profits II. Extraordinary losses N. Gross profit (loss) O. Income tax P. Other obligatory decrease of gross profit (increased loss) R. Net profit (loss)

17 2.5 Statement of changes in equity - Statement of the total income of ZPUE S.A [in thous. PLN] from to from to from to from to I. Opening balance of equity (BO) valuation adjustments I.a. Opening balance of equity capital (fund) (BO), adjusted Opening balance of stated capital (fund) Changes in stated capital (fund) a) increase (due to) share issue (stock issue) increase in capital from net profit b) decrease (due to) redemption of shares Closing balance of stated capital (fund) Opening balance of called up stated capital Change in called up stated capital a) increase (due to) b) decrease (due to) Closing balance of called up stated capital Opening balance of own shares a) increase b) decrease Closing balance of own shares Opening balance of supplementary capital (fund) Changes in supplementary capital (fund) a) increase (due to) issue of shares above face value from profit distribution (statutory) from profit distribution (above the statutory value) b) decrease (due to) loss coverage Closing balance of supplementary capital (fund) Opening balance of revaluation reserve capital (fund) Changes in revaluation reserve capital (fund) a) increase (due to) b) decrease (due to) disposal of property, plant and equipment Closing balance of revaluation reserve capital (fund) Opening balance of other reserve capitals (funds) Changes in other reserve capitals (funds) a) increase (due to) b) decrease (due to) Closing balance of other reserve capitals (funds) Opening balance of Minority capital Changes in capital increase decrease Minority capital at end of year

18 8. Opening balance of previous years' profit (loss) Opening balance of previous years' profit adjustments of fundamental errors Opening balance of previous years' profit after adjustments a) increase (due to) distribution of previous years profit revaluation of fixed assets b) decrease from/of profit division Closing balance of previous years' profit Opening balance of previous years' loss adjustments of fundamental errors Opening balance of previous years' loss after adjustments a) increase (due to) re-booking of previous years' loss to be covered b) decrease (due to) Closing balance of previous years' loss Closing balance of previous years' profit (loss) Net profit a) net profit b) net loss c) write-offs on profit II. Closing balance of equity (BZ) III. Equity (fund) including proposed profit distribution (loss coverage) Cash flow account - Statement of the cash flow of ZPUE S.A. [in thous. PLN] A. Cash flow from operational activities - indirect method according to IAS from to from to from to from to I. Gross profit (loss) II. Total adjustments Profit (loss) of minority shareholders Shares in net profit (loss) of subsidiaries and affiliates consolidated by equity method Depreciation impairment write-offs of a subsidiary's or affiliate's company or negative value of a subsidiary or affiliate Exchange gains (losses) Interest and profit sharing (dividend) Profit (loss) on investment activities Change in reserves Change in inventory Change in receivables Change in short-term liabilities excluding credits and loans Change in prepayments and accruals Income tax paid Other adjustments III. Net cash flows from operating activities (I+/-II)

19 B. Cash flows from investment activities I. Inflows Disposal of intangible and property, plant and equipment Disposal of investments in real property and in intangible assets From financial assets, including: a) in subsidiaries and affiliates sale of financial assets dividend and profit sharing repayment of long-term loans interest other inflows from financial assets b) in other entities sale of financial assets dividend and profit sharing repayment of long-term loans interest other inflows from financial assets Other inflows from investment activities II. Outflows Acquisition of intangible and property, plant and equipment Investments in real property and in intangible assets For financial assets, including: a) in subsidiaries and affiliates acquisition of financial assets granted long-term loans b) in other entities acquisition of financial assets granted long-term loans Other outflows from investment activities III. Net cash flows from investment activities (I-II) C. Cash flows from financial activities I. Inflows Net inflows from issuance of shares and other capital instruments and from capital contributions Credits and loans Issuance of debt securities Other inflows from financial activities II. Outflows Purchase of own shares Dividends and other payments to shareholders Profit distribution liabilities other than profit distribution payments to shareholders Repayment of credits and loans Redemption of debt securities From other financial liabilities Payment of liabilities arising from financial leases Interest Other outflows from financial activities

20 III. Net cash flows from financial activities (I-II) D. Total net cash flows (A.III+/-B.III+/-C.III) E. Balance sheet change in cash, including: change in cash due to exchange rate differences F. Cash opening balance G. Closing balance of cash (F+/-D), including Differences arising from the conversion of ZPUE S.A. statements to IAS Unconsolidated ZPUE SA statement - as of the date of conversion in '000 PLN. Selected balance sheet items value according to Accounting Act adjustments according to IAS/IFRS Intangible assets, including: from reassessing to fair market value from change in presentation of development work Fixed assets, including: from reassessing to fair market value from change in presentation of leased fixed assets Advance payments for fixed assets under construction from change in presentation of advance payments -209 Long-term receivables from other entities discounting mortgage receivables -79 Long-term investments, incl.: change in presentation of leased fixed assets Other deferred charges and accruals, including: from change in presentation of development work Advance payments for deliveries of goods and services, incl.: from change in presentation of advance payments Other receivables from other entities, including: elimination of the value of receivables from loans from the company social fund from change in presentation of advance payments Cash, including: elimination of funds for the company social fund -255 Total adjustment of assets Profit from previous years, including: discounting mortgage receivables from reassessing assets to fair market value from referring the reserve for deferred tax adjustment to revenue of future periods Reserves for deferred income tax, including: from referring the reserve for deferred tax Short-term liabilities, including: elimination of liabilities from the company social fund 5 Special funds, including: elimination of the company social fund Accruals and deferred income Total adjustment of liabilities

21 Unconsolidated ZPUE SA statement - as of the date of conversion in '000 PLN. Selected balance sheet items value according to Accounting Act adjustments according to IAS/IFRS Intangible assets, including: from reassessing to fair market value from change in presentation of development work Fixed assets, including: from reassessing to fair market value from change in presentation of leased fixed assets Advance payments for fixed assets under construction from change in presentation of advance payments -83 Long-term receivables from other entities discounting mortgage receivables -76 Long-term investments, incl.: change in presentation of leased fixed assets Other deferred charges and accruals, including: from change in presentation of development work Advance payments for deliveries of goods and services, incl.: from change in presentation of advance payments Other receivables from other entities, including: elimination of the value of receivables from loans from the company social fund from change in presentation of advance payments Cash, including: elimination of funds for the company social fund -92 Total adjustment of assets Profit from previous years, including: discounting mortgage receivables from reassessing assets to fair market value from referring the reserve for deferred tax adjustment to revenue of future periods Net profit, including: discounting mortgage receivables 3 - from reassessing assets to fair market value from referring the reserve for deferred tax 241 Reserves for deferred income tax, including: from referring the reserve for deferred tax Special funds, including: elimination of the company social fund Liabilities from deliveries and services (social fund) Accruals and deferred income Total adjustment of liabilities

22 3 COMMENTARY AND ADDITIONAL INFORMATION TO THE CONSOLIDATED FINANCIAL STATEMENT FOR THE 4TH QUARTER OF Basic information about the Company, area of business ZPUE S.A. based in Włoszczowa (until 18 December 2006 the Company operated under the name Zakład Produkcji Urządzeń Elektrycznych B.Wypychewicz Spółka Akcyjna) was founded on the basis of a company contract confirmed by a notary act. The Company began operating on 7 January 1997 on the day it was first entered on the Commercial Register of the District Court in Kielce as no. RHB It was entered on the National Court Register on 27 November 2001 as KRS: The entity keeping the register is the District Court in Kielce, 10th Commercial Division of the National Court Register. According to the Polish Classification of Economic Activities, the Company's core business is manufacture of switchgear and controlgear (PKD Z). The Company's core business is: - manufacture of concrete construction products, - manufacture of prefabricated concrete mass, - manufacture of cold-moulded products, - manufacture of metal structures and their parts, - manufacture of parts for construction carpentry, - manufacture of other tanks, cisterns and metal containers, - manufacture of (tele)communications equipment, - manufacture of switchgear and controlgear, - manufacture of installation equipment, - manufacture of other electrical equipment, - repair and maintenance of finished metal products, - repair and maintenance of electrical appliances, - installation of industrial machinery, equipment and fittings, - construction work connected with the erection of residential and non-residential buildings, - work connected with the construction of telecommunications and electrical power lines, - construction of electrical systems, - installing construction joinery, - other specialised construction work, - wholesale of machines used in mining, construction and civil and water engineering, - road transport of goods, - warehousing and storage of other goods, - other financial service activities, except insurance and pension funds, - activities in the field of engineering and related technical consultancy, - other research and technical analysis, - other activities associated with providing employees. According to the classification adopted by the regulated market, the Company is categorised as a company from the electrical machinery industry. The Issuer is established for an indefinite time. 3.2 Scope of the Consolidated Financial Statement presented The Consolidated Quarterly Financial Statement of ZPUE S.A. Capital Group for the 4th quarter of 2010 covers the period from 1 October 2010 to 31 December 2010, including the financial statements of the parent company and the financial statement of the subsidiary since the takeover date, i.e Comparative data for the 4th quarter of 2009 cover data for the period from to for the parent company only. In order to present data better, the Management Board of ZPUE S.A. took the decision to expand the scope of data presented in the financial statements for the 4th quarter of 2010 compared with data published for the 3rd quarter of

23 3.3 Information about entities covered by consolidation The Consolidated Quarterly Financial Statement for the 4th quarter of 2010 was prepared based on financial data of ZPUE S.A. based in Włoszczowa and data of ZPUE Gliwice Sp. z o.o. based in Gliwice, part of the ZPUE S.A. Group. The Parent Company: ZPUE SA took over control of ZPUE Gliwice Spółka z o.o. based in Gliwice on ZPUE S.A. owns 99.9% of the share capital of ZPUE Sp. z o.o. ZPUE Gliwice Sp. z o.o.'s business profile includes production of low voltage thermosetting plastic cables and metering cable boxes and renovation and metering services for electrical power appliances, including thermal imaging. As of 31 December 2010, ZPUE S.A. owns 28 shares in the Przedsiębiorstwo Aparatów i Konstrukcji Energetycznych ZMER Sp. z o.o. in Kalisz, entitling it to 28 votes at the Partners Meeting, which constitutes 3.92% of the total number of votes. This company is not, however, part of the ZPUE S.A. Capital Group and is not subject to consolidation. 3.4 Methods of preparing financial statements The consolidated quarterly financial statement of the ZPUE S.A. Capital Group was prepared assuming continuation of commercial activity by the companies constituting the Group in the foreseeable future. On the date this consolidated financial statement is drawn up there are no circumstances that could be regarded as a threat to continued business operations of the Group. The Consolidated Financial Statement has been prepared in compliance with the International Accounting Standards (IAS) and International Financial Reporting Standards (IFRS) and related interpretations published in the form of European Commission ordinances, and where not regulated by the aforementioned regulations, in accordance with accountancy principles defined in the Accountancy Act of 29 September 1994 (Journal of Laws 2002 no. 76, item 694) and the legislation issued based thereon. The basis for preparing the Consolidated Financial Statement is the consolidation documentation which covers the financial statements of the constituent companies of the Group after taking into consideration consolidation exclusions and adjustments. The entities subject to consolidation apply uniform methods of valuation and preparation of financial statements in accordance with IAS. The Consolidated Statement was prepared on the basis of the financial statement of the parent company and the financial statement of the subsidiary. With consolidation by the full method, all the relevant items of assets and liabilities of the subsidiary and the parent company are totalled according to their full value. After totalling these up, corrections and consolidation exclusions were made, in accordance with the applicable regulations. With consolidation of the profit and loss account by the full method, all the relevant items of income and expenditure of the subsidiary and the parent company are totalled. Items on the subsidiary's profit and loss account are totalled at their full value regardless of the extent to which the parent company owns the subsidiary. After totalling these up, corrections and consolidation exclusions were made, in accordance with the applicable regulations. The following significant items are excluded from the consolidated financial statement: - mutual receivables and liabilities, Revenue and costs regarding operations carried out between consolidated entities, Profits and losses arising from operations conducted between entities subject to consolidation, included in the value of the assets and liabilities subject to consolidation, value of purchasing shares owned by the parent company in the subsidiary subject to consolidation. 3.5 Characteristics of the major principles and methods used for evaluating assets and liabilities and establishing the financial result The summarised mid-year consolidated financial statement was prepared in accordance with the concept of historical cost. The financial year is the calendar year. The statement of total revenues is prepared by functional agreement. The cash flow statement was prepared by the direct method. The report currency is PLN. Sums are presented in thousands of PLN, unless indicated otherwise. Preparation of the financial statement in accordance with IAS/IFRS required the Management Board to make judgements, estimates and assumptions which affect the implementation of the accountancy principles adopted 23