Unaudited Busi Telekom Slovenia Group for the period

Transcription

Unaudited Business Report of the
Telekom Slovenia Group and Telekom Slovenije, d. d.
for the period January – March 2011
Ljubljana, 25 May 2011
Unaudited Business Report of the Telekom Slovenia Group and Telekom Slovenije, d. d.
Contents
1
INTRODUCTORY NOTE ................................................................................................................................ 1
1.1
2
Statement of responsibility of the Management Board ........................................................... 1
MISSION, VISION, VALUES AND STRATEGIC OBJECTIVES ..................................................................... 2
2.1
Mission, values and vision ....................................................................................................... 2
2.2
Strategic guidelines and objectives of the Telekom Slovenia Group ...................................... 3
2.2.1
3
Plans for 2011 .................................................................................................................. 3
TELEKOM SLOVENIA GROUP ...................................................................................................................... 4
3.1
On the map of Europe ............................................................................................................. 4
3.2
Organisation of the Telekom Slovenia Group ......................................................................... 5
3.3
Operating highlights ................................................................................................................. 6
3.3.1
Key financial indicators for the Telekom Slovenia Group ................................................ 6
3.3.2
Overview by company and key market............................................................................ 6
3.4
Ownership structure and share trading ................................................................................... 7
3.5
Market shares in key service segments ................................................................................ 10
3.6
Regulation .............................................................................................................................. 11
3.7
Risk management .................................................................................................................. 11
4
CORPORATE GOVERNANCE ..................................................................................................................... 12
5
SIGNIFICANT EVENTS IN THE PERIOD JANUARY – MARCH 2011 ......................................................... 14
6
SIGNIFICANT EVENTS AFTER THE BALANCE-SHEET DATE .................................................................. 15
7
FINANCIAL STATEMENTS OF THE TELEKOM SLOVENIA GROUP AND TELEKOM SLOVENIJE, D. D.
FOR THE PERIOD JANUARY – MARCH 2011 .................................................................................................... 16
7.1
Introductory notes .................................................................................................................. 16
7.2
Condensed unaudited financial statements of the Telekom Slovenia Group for the period
January – March 2011 ....................................................................................................................... 18
7.3
Condensed unaudited financial statements of Telekom Slovenije, d. d. for the period
January – March 2011 ....................................................................................................................... 26
1
INTRODUCTORY NOTE
Pursuant to the provisions of the Rules of the Ljubljana Stock Exchange, Telekom Slovenije, d. d., with its
registered office at Cigaletova 15, Ljubljana, hereby publishes the Unaudited Business Report of the
Telekom Slovenia Group and Telekom Slovenije, d.
d d. for the period January – March 2011.
All the financial statements of the Telekom Slovenia Group and Telekom Slovenije, d. d. have been
compiled in accordance with the International Financial Reporting Standards. The financial statements for
the period January – March 2011 have not been audited.
The Company's Supervisory Board discussed the Unaudited Business Report of the Telekom Slovenia
Group and Telekom Slovenije, d. d. for the first three months of 2011 at its session on 25 May 2011.
Any significant
cant changes to the data contained in the prospectus for listing on the stock exchange are
regularly published by the Company on the Ljubljana Stock Exchange’s website SEOnet and on the
Company’s website at www.telekom.si.
www.telekom.si
The Unaudited Business Report for
fo the period January – March 2011 is also available on the Company's
website at www.telekom.si.
1.1
Statement of responsibility of the Management Board
The members of the Management Board of Telekom Slovenije, d. d., responsible for compiling the report of
the Telekom Slovenia Group and Telekom Slovenije, d. d. for the period January – March 2011, hereby
confirm that to the best of our knowledge:
-
the condensed financial statements have been compiled in accordance with international
accounting standards on interim financial reporting, and give a true and fair picture of the assets,
liabilities, financial position and operating results of the Telekom Slovenia Group and Telekom
Slovenije, d. d., and
-
the interim Business Report presents a fair picture of information regarding major transactions with
related parties, in accordance with regulations.
Management Board of Telekom Slovenije, d. d.
Ivica Kranjčević,
Zoran Vehovar, MSc,
President of the
Management Board
Vice-President
President of the
Management Board
Marko
Boštjančič,
Member of the
Management
Board
1
Dr Jožko Peterlin,
Darja Senica,
Member
of
the
Management Board
Member of the
Management
Board
and
Workers Director
2
MISSION, VISION, VALUES AND STRATEGIC OBJECTIVES
2.1
Mission, values and vision
Mission
We are the best at connecting people – any time, any place.
We are the best at connecting individuals and families, and we are the best at connecting them to services
that make their life easier, with relevant information and high-quality content. We provide for the highquality, comprehensive and reliable connection of companies and institutions, and individual devices.
Values
We are a well-tuned team.
Our employees work in a creative environment, in constant touch with the most cutting-edge technologies.
We value commitment, self-initiative and entrepreneurial thinking.
We live with the user.
Our guiding principle is a satisfied customer. We ensure a friendly user experience with an attractive offer,
carefully thought-out services and content, and excellent support.
We are reliable and innovative.
We have the most reliable and extensive networks, which will continue to ensure high-quality services in
the future. We are pioneers in the introduction of the latest generations of mobile and fixed
telecommunications and multimedia content, and above all ensure their interconnectivity.
We are proud of our roots and talents.
We invest responsibly in Slovenian society and the environment, and support the development of local
expertise and the exchange of experiences and innovative solutions between the markets on which we
operate. We are responsibly aware of our importance to all of our partners and owners.
Vision
The leader in integrated and simple communications.
By connecting all mobile and fixed information and communication technologies, services, multimedia
content and devices, the Group will provide individuals and businesses a simple and secure user
experience of the highest quality. It will thus remain the leader in the telecommunications sector in Slovenia
and become a leader in the IT and media sectors. The Group will be a cost effective and profitable ICT
operator on markets outside of Slovenia.
2
2.2
Strategic guidelines and objectives of the Telekom Slovenia Group
We will accomplish the following by 2015 on the basis of our established objectives:
- We will remain the leading telecommunications operator in Slovenia, and a provider of innovative
services, with a stable market share.
- We will become the leading provider of ICT services.
- We will become the leading local provider of advance digital media advertising services, and digital
services and content in Slovenia.
- We will achieve considerable savings by centralising the procurement function and exploiting the
purchasing power of the Group.
- We will become the leading and preferred regional provider of international operator services.
- We will be a growing and profitable alternative operator on the markets of South-Eastern Europe, by
exploiting synergies within the Telekom Slovenia Group.
- With regard to human resources, we will shift from a technologically oriented company to a service and
development oriented company.
- By promoting knowledge, quality and innovation, we will become a service oriented, high-technology
company based on sustainable development, comparable with the most successful ICT companies in
the European Union in terms of profitability.
With its new organisational structure, the Telekom Slovenia Group will be prepared to implement its new
strategic guidelines, which include the following:
- growth in revenues and maintaining the market shares of telecommunication services in Slovenia;
- development of ICT services;
- development of digital media advertising and the monetisation of digital media and applications in
Slovenia;
- development of international wholesale services;
- profitable growth in selected countries of South-Eastern Europe;
- systematic reduction of procurement costs and investments;
- development of human resources, increase in labour productivity, and restructuring from a
technologically oriented company to a sales and service oriented company;
- quality and business excellence; and
- sustainable development.
2.2.1
Plans for 2011
Owing to the operating results achieved in 2010 and other objective economic and market circumstances,
the Management Board of Telekom Slovenije, d. d. has already adopted and is in the process of
implementing measures to improve the situation and realise plans for 2011.
The aforementioned measures are primarily based on:
- reducing all types of costs,
- the restructuring of operations in Macedonia and Kosovo;
- the possible sell-off of non-strategic investments;
- changes in sales and marketing.
- the restructuring of business processes and the reduction of procurement costs;
- the optimisation of working capital;
- the protection of claims for regulated services; and
- the optimisation and sale of real estate.
In the current circumstances, the governance of subsidiaries must be adapted or a new method of
governance established. Costs must also be reduced. The merger of Telekom Slovenije and Mobitel,
planned for the middle of the year (and the merger of Planet 9, d. o. o. with Najdi, informacijske tehnologije,
d. o. o. on 1 April 2011), is required to meet long-term market objectives and to exploit all synergies in the
area of electronic communications, IT and media. Only consolidated operators, who cost-effectively draw
on economies of scale that arise from offering numerous services in a single network, can survive in the
long term.
The target net profit of the Telekom Slovenia Group in 2011 is EUR 28.1 million.
3
3
TELEKOM SLOVENIA GROUP
3.1
On the map of Europe
Telekom Slovenia Group markets are displayed on the map below:
4
3.2
Organisation of the Telekom Slovenia Group
As at 31 March 2011 the Telekom Slovenia Group comprised the parent company Telekom Slovenije, d. d.,
14 direct subsidiaries, 10 indirect subsidiaries and one joint venture.
Slovenia
Abroad
Telekom Slovenije, d. d.
Mobitel, d.d.
100 %
ON.NET DOO Skopje (Makedonija)
83,38 %
M-Pay, d.o.o.
50 %
IPKO Telecommunications d.o.o. (Kosovo)
93,11 %
SOLINE, d.o.o.
100 %
Ipko Net Albania, d.o.o.
100 %
GVO, d.o.o.
100 %
Media Works, d.o.o.
100 %
AVTENTA.SI, d.o.o.
100 %
DSN, d.o.o.
50%
Najdi, informacijske storitve, d.o.o.
100 %
ANEKS d.o.o. Banja Luka (BiH, Republika Srbska)
70 %
MEGANET, d.o.o.
50,1 %
Gibtelecom Limited (Gibraltar)
50 %
POGODAK TRAŽILICA d.o.o. u likvidaciji (Hrvaška)
100 %
SIOL d.o.o. (Hrvaška)
100 %
Pogodak, d.o.o. (Srbija)
100 %
SIOL B.V. in liquidation (Nizozemska)
100 %
PLANET 9, d.o.o.
100 %
ONE DOO Skopje (Makedonija)
79,47 %
ONE DOO Skopje (Makedonija)
20,53 %
ON.NET DOO Skopje (Makedonija)
16,62 %
ONE TO ONE AD Skopje (Makedonija)
100 %
DIGI PLUS MUTIMEDIA LTD., Skopje (Makedonija)
100 %
PRIMO Communications d.o.o. (Albanija)
75 %
Changes in the composition of the Group in the first quarter of 2011:
-
The Serbian company Pogodak, d. o .o., Belgrade, which is fully owned by the subsidiary Najdi,
informacijske storitve, d. o. o., begins liquidation proceedings on 11 January 2011. For this reason, the
company's name is changed to Pogodak, d. o. o., Belgrade – in liquidation.
-
Telekom Slovenije, d. d. becomes owner of an additional 5.09% participating interest in the
Macedonian company One, d. o. o., Skopje on 12 January 2011 via a capital increase carried out in
December 2010.
5
3.3
3.3.1
Operating highlights
Key financial indicators for the Telekom Slovenia Group
I - III
2011/31.03.2011
in thousand EUR
Operating revenues
EBITDA
EBITDA margin
EBIT
Return on sales: ROS (EBIT/net sales revenue) in %
Net profit/loss
Assets
Equity
Equity ratio in %
Net financial debt
Investment in property, plant and equipment (CAPEX)
EBITDA - CAPEX
Ratio of (EBITDA-CAPEX) to EBITDA (cash margin) in %
3.3.2
196,074
72,490
37.0%
22,922
11.8%
14,483
1,642,904
818,871
49.8%
480,341
12,306
60,184
83.0%
I - III
2010/31.12.2010
203,422
65,342
32.1%
11,373
5.6%
-633
1,658,228
807,812
48.7%
597,726
24,898
40,444
61.9%
Ind.
11/10
96
111
115
202
211
99
101
102
80
49
149
134
Overview by company and key market
Operating revenues
in thousand EUR
I - III 2011
Ind.
11/10
I - III 2010
Telekom Slovenije
91,307
97,513
94
Mobitel
90,049
93,969
96
Other companies in Slovenia
19,393
25,389
76
Ipko - Kosovo
15,512
15,831
98
Companies in Macedonia
16,660
17,201
97
Other companies in SEE
4,653
4,886
95
Total - unconsolidated
237,574
254,789
93
Eliminations
-41,500
-51,367
81
Telekom Slovenia Group
196,074
203,422
96
EBITDA – earnings before interest, taxes, depreciation and amortisation
in thousand EUR
I - III 2011
Ind.
11/10
I - III 2010
Telekom Slovenije
32,144
26,745
120
Mobitel
30,085
28,817
104
2,627
3,161
83
Ipko - Kosovo
5,162
6,418
80
919
721
127
430
486
88
1,127
856
72,494
67,204
132
108
-4
-1,862
0
72,490
65,342
111
Gibtelecom
Total - unconsolidated
Eliminations
6
Investments
in thousand EUR
I - III 2011
Ind.
11/10
I - III 2010
Telekom Slovenije
5,737
10,106
57
Mobitel
3,121
2,687
116
1,381
1,276
108
115
892
13
1,155
8,149
14
797
1,789
45
12,306
24,898
49
Ipko - Kosovo
Employees
31.03.2011
31.03.2010
Telekom Slovenije
1,742
1,871
Mobitel
Ind.
11/10
93
1,028
1,052
98
841
833
101
Ipko - Kosovo
467
545
86
538
623
86
203
204
100
4,819
5,128
94
3.4
Ownership structure and share trading
Ownership structure and largest shareholders
There were no significant shifts in the ownership structure of Telekom Slovenije, d. d. in the first quarter of
2011. The most significant changes in ownership were recorded by domestic corporates, who decreased
their stake by 0.19 percentage points to 6.45%, and by foreign corporates, who increased their stake by
0.26 percentage points to 2.63%.
As at 31 March 2011 there were 12,386 shareholders entered in the register of shareholders, a decrease of
290 on the end of 2010 and a decrease of 924 on the same day in 2010.
Ownership structure as at 31 March 2011
52,54 % Republic of Slovenia
14,25 % SOD - state fund
10,17 % Individual shareholder
6,45 % Domestic legal persons
7,36 % KAD with PPS (state fund)
6,14 % Institucional investors
2,63 % Foreign legal persons
0,46 % Treasury shares
7
Ten largest shareholders
As at 31 March 2011 the ten largest shareholders held 79.96% of the Company’s share capital, down 0.01
percentage points on the same day in 2010.
%
Shareholder as at 31 March 2011
%
Shareholder as at 31 March 2010
Republic of Slovenia
52.54 Republic of Slovenia
52.54
Slovenska odškodninska družba, d. d.
14.25 Slovenska odškodninska družba, d. d.
14.25
Kapitalska družba, d. d.
5.59 Kapitalska družba, d. d.
5.59
NFD 1 delniški investicijski sklad, d. d.
2.36 NFD 1 delniški investicijski sklad, d. d.
2.36
Kapitalska družba, d. d. (PPS)
1.77 Kapitalska družba, d. d. (PPS)
1.77
Triglav vzajemni skladi – delniški Triglav steber I
0.85 Triglav vzajemni skladi – delniški Triglav steber I
0.85
Perspektiva FT, d. o. o.
0.75 Poteza naložbe, d. o. o.
0.70
Intersvet, d. o. o.
0.66 Alpe Adria Privatbank AG
0.69
Hypo Bank, d. d.
0.64 Hypo Bank, d. d.
0.67
NLB, d. d.
0.55 NLB, d. d.
0.55
Total
79.96 Total
79.97
Number of shares held by the Management Board and the Supervisory Board of Telekom Slovenije,
d. d.
The table below lists the members of the Management Board and Supervisory Board who held TLSG
shares as at 31 March 2011. Other members of the aforementioned bodies did not hold the Company's
shares.
Overview of shares held by the Management Board and the Supervisory Board of Telekom Slovenije, d. d.
Name
Office
Number of shares
% of equity
Management Board
Darja Senica
Member of the Management Board and Workers Director
338
0.0052
Dr Tomaž Kalin
Vice-President of the Supervisory Board
100
0.0015
Martin Gorišek
Member of the Supervisory Board
125
0.0019
Milan Richter
Vice-President of the Supervisory Board
1
0.0000
564
0.0086
Supervisory Board
Total
Share trading and key share-related financial data
The share price fell by 5.81% in the first quarter of 2011 compared with the price at the beginning of the
accounting period. The share price closed at EUR 81 on the last trading day of March.
Trading statistics for TLSG shares on the Ljubljana Stock Exchange in the first quarter of 2011
Standard price in EUR*
I - III 2011
High
Low
Average
Volume in EUR thousand
Total volume for the year
Highest daily volume
Lowest daily volume
Average
89.70
76.30
84.83
I - III 2011
5,821.05
654.68
3.82
92.40
8
I - III 2010
137.05
115.01
126.82
I - III 2010
6,352.45
1,031.68
5.31
102.46
Movement in the TLSG share price compared to the SBI TOP
1000
EUR
100
950
95
900
850
SBITOP
90
800
85
750
TLSG
700
80
650
600
75
550
70
500
TLSG in EUR
SBITOP
Key financial data relating to shares
31 March 2011
31 March 2010
81.00
97.82
124.00
95.54
Earnings per share (EPS) in EUR
2.28
0.13
P/BV
0.83
1.30
Market price (P) of one share on the last trading day of the
period in EUR
1
Book value (BV) of one share in EUR
2
3
Capital return per share in %
-5.81%
-8.82%
The book value of one share is calculated as the ratio of the book value of Telekom Slovenije, d. d.’s equity on the last
day of the period to the weighted average number of ordinary shares during the accounting period excluding treasury
shares.
2
Earnings per share is calculated as the ratio of the Telekom Slovenije, d. d.'s net operating profit for the accounting
period to the weighted average number of ordinary shares during the accounting period excluding treasury shares.
3
The capital return per share is calculated as the ratio of the share price on the final trading day of the period minus the
share price on the first trading day of the period to the share price on the first trading day of the period.
1
9
3.5
Market shares in key service segments
Number of users/connections
2.500.000
2.000.000
2.121.950
2.100.435
2.054.899
1.928.412
1.500.000
882.572
856.366
1.000.000
817.905
828.951
500.000
492.949
464.752
426.602
344.659
0
Q1
Q2
Q3
Q4
Q1
Q2
2007
Q3
Q4
Q1
Q2
2008
mobile telephony
Q3
Q4
Q1
Q2
2009
Q3
Q4
2010
fixed telephony
broadband
Source: SORS 4Q2010.
Telekom Slovenia Group market shares by service in the fourth quarter of 2010
Telekom Slovenije
other operators
fixed broadband
access
IP TV
60%
43.1 Market Share
Annual change - 2.8 perc. points
60.2 % Market Share
Annual change - perc. points
43%
119,.539 connections
Annual change + 9 %
57%
211,665 connections
Annual change 0 %
40%
57%
42.7% Market Share
Annual change -5.3 perc. points
45%
55%
171,717 connections
Annual change + 19 %
54.7 % Market Share
Annual change - 1.6 perc. points
1,161,236 connections
Annual change - 2 %
43%
VoIP
mobile telephony
Mobitel
* The graph for VoIP includes both the number of VoIP services and the number of IP Centrex connections.
Sources: Report for the 4th quarter of 2010, APEK, Telekom Slovenia Group, own calculations.
1
Note: There is a more significant deviation from previous periods for VoIP, as the APEK amended figures for 2009
related to IP telephony, both in terms of market shares and the number of connections on the market.
1
Post and Electronic Communications Agency of the Republic of Slovenia (hereinafter: the APEK or the Agency).
10
3.6
Regulation
Regulatory developments in Slovenia
On 13 December 2010 the Information Society Directorate published the draft Act amending the
Electronic Communications Act. The amendments primarily relate to the appointment and discharge of
the Agency's director, while there were a few amendments and adjustments regarding the range of possible
obligations of an operator with significant market power. The Electronic Communications Act was approved
by the National Assembly on 20 April 2011. It was published in the Official Gazette on 3 May 2011 and
enters into force 15 days from that date.
The Agency put forward for public consultation the points of departure for the drafting of the strategy on the
use of the frequency spectrum, a draft recommendation on the affordability of universal services and a
recommendation on the method and conditions for the implementation of measures for the termination of
operator access agreements. The latter recommendation is of particular importance for Telekom Slovenije,
d. d., as the Agency has given its first clear public signal that failure to settle obligations could result in the
deactivation of an operator.
Relevant markets
The Agency's action plan published in March envisages the following market analyses in the first half of the
year: market 1 "Access to the public telephone network at a fixed location for residential and non-residential
customers"; market 6 "Wholesale terminating segments of leased lines, irrespective of the technology used
to provide leased or dedicated capacity"; and market 5 "Wholesale broadband access". An analysis of
market 3 "Call termination on individual public telephone networks provided at a fixed location" is planned
for the second half of the year.
The APEK issued a decision on 28 March 2011, in which it found that Telekom Slovenije, d. d. is an
operator with significant market power on market 4. According to the new decision, Telekom Slovenije, d. d.
will be forced to allow operators access to copper-based local loops and subloops, optical fibre local loops,
in-house wiring, the optical distribution frame, shafts and ducts and to dark fibres and active Ethernet
equipment for the use of subloops. The Agency also imposed the following measures on Telekom
Slovenije, d. d.: obligation to ensure equal treatment, price control and cost accounting obligations, and the
obligation to keep separate accounting records.
3.7
Risk management
The Telekom Slovenia Group continued with its systematic approach to risk management during the first
quarter of 2011. Risk inventory and assessment, which were carried out in line with the new risk
assessment and reporting methodology, were expanded to the entire Telekom Slovenia Group. Key risks
that remain significant, even after the adoption of measures to manage them, are presented below.
Key risks for the fixed telecommunications market
-
The risk of full regulation of data services, which are only partly regulated.
The risk of the migration of users to other operators is high owing to planned changes in the prices of
services and operator access to the optical fibre network.
The risk of a general drop in retail and wholesale prices results in lower ARPU, and is also linked to
changing macroeconomic conditions, in particular diminishing purchasing power and demand.
The risk of failure by operators to fulfil obligations. Certain operators do not settle their obligations for
services regulated by the APEK.
The risk of revenue loss due to disruptions in processes on account of poor-quality data, or owing to
the loss of data in operations support and business support systems (OSS and BSS).
Employee-related risks are primarily linked to achieving the internal restructuring plan.
Key risks for the mobile telecommunications market
-
The risk of failure by subscribers and operators to fulfil obligations. The economic crisis has been
reflected in the extension of payment deadlines, and in an increased number of corporate liquidations
and bankruptcies, and personal bankruptcies.
The risk of the departure of key personnel staff can endanger the functioning of major work processes.
11
-
In contrast to the fixed telephony segment, the risk of a general drop in prices has diminished
significantly in the mobile telephony segment, as retail prices are not expected to fall further, while
wholesale prices are being reduced in line with the method prescribed by the APEK.
Key convergence risks and risks in the area of digital media and applications
-
The risk of an increase in the number of supervisory procedures remains high, as implemented
measures do not necessarily mitigate risks owing to the autonomy of the regulatory body.
The risk of a decrease in advertising space, as companies earmark fewer funds for advertising owing to
the poor economic conditions.
Key risks on the markets of South-Eastern Europe
-
The risk of the migration of users to other operators owing to the aggressive approach of the
competition.
The risk of lower revenues owing to the deteriorating economic situation and the declining purchasing
power of the population; a drop in transfers from abroad. Prices on telecommunications markets
continue to fall.
The risk of insufficient and inappropriate regulation – the amendment and adoption of rules that are
contrary to the interests of the company.
Liquidity risk, which is reflected in cash shortfalls for current operations and investment, has increased.
The risk of dependence on external partners.
The risk of abuse.
4
CORPORATE GOVERNANCE
Management Board
Telekom Slovenije, d. d. is managed by a five-member Management Board, which began its four-year term
in 2010. The Management Board comprised the following members as at 31 March 2011:
- Ivica Kranjčević, President
- Zoran Vehovar, MSc, Vice-President
- Dr Jožko Peterlin, member
- Marko Boštjančič, member
- Darja Senica, member and Workers Director
Supervisory Board
The Supervisory Board has nine members, six of whom are shareholder representatives and three of whom
are employee representatives.
The members of the Supervisory Board submitted a statement of compliance with the criteria of
independence in accordance with the Corporate Governance Code.
The Supervisory Board comprised the following members as at 31 March 2011:
Shareholder representatives:
- Tomaž Berginc, MSc, President
- Dr Tomaž Kalin, Vice-President
- Dr Jaroslav Berce, member
- Dr Marko Hočevar, member
- Ciril Kafol, MSc, member
- Dr Zvonko Kremljak, member
Employee representatives:
-
Milan Richter (Vice-President)
Martin Gorišek, member
Branko Sparavec, member
There were no changes to the composition of the Supervisory Board in the period from 1 January 2011 to
31 March 2011. The four-year term of shareholder representatives ends on 26 April 2013, while the term of
employee representatives ends on 13 November 2013.
12
Management and governance of subsidiaries
Composition of management and governance bodies at subsidiaries of the Telekom Slovenia Group
as at 31 March 2011
Slovenia
Mobitel, d. d.
Board of Directors: Ivica Kranjčević (President), Zoran Janko, Zoran Vehovar, MSc, Marko Boštjančič, Dr
Jožko Peterlin, Tjaša Škrilec and Branko Miklavčič
CEO: Zoran Janko
Note: The company has a single-tier system of corporate governance.
GVO, d. o. o.
Managing Director: Edo Škufca
Avtenta. si, d. o. o.
Managing Director: Vedran Krevatin
Note: Iztok Klančnik's term as Managing Director expired on 28 February 2011, when he was replaced by Vedran Krevatin.
Najdi, informacijske storitve, d. o. o.
Managing Director: Bojana Sonnenwald Turk
Notes: The company is managed by Rudolf Skobe since 1 April 2011. Planet 9, d. o. o. was merged with Najdi, informacijske storitve,
d. o. o. on 1 April 2011.
Planet 9, d. o. o.
Managing Director: Rudolf Skobe
Note: The company was merged with Najdi, informacijske storitve, d. o. o. on 1 April 2011.
Other countries
IPKO Telecommunications, d. o. o.
Board of Directors: Ivica Kranjčević (President), Bujar Musa (Vice-President), Akan Ismaili, Klavdij Godnič
and Robert Erzin
CEO: Robert Erzin, MSc
Notes: Management and governance are realised in line with the relevant legislation in Kosovo.
Branko Babič was relieved of his position as member of the Board of Directors and CEO on 1 February 2011, and replaced by Robert
Erzin, MSc on the same day.
The terms of Bujar Musa and Akan Ismaili expired on 31 March 2011.
Aneks, d. o. o., Banja Luka
Managing Director: Igor Bohorč, MSc
Note: Management and governance are realised in line with the relevant legislation in the Republic of Srpska (Bosnia and
Herzegovina).
Primo Communications, d. o. o.
Directors: Visar Dobroshi, Meta Zakrajšek and Barbara Kozarić
CEO: Visar Dobroshi
Notes: Management and governance are realised in line with the relevant legislation in Albania.
Visar Dobroshi served in his function until 31 March 2011, while Robert Erzin served in his function until 31 January 2011. Marko
Jagodič was appointed director on 1 April 2011, while Meta Zakrajšek was appointed CEO on the same day.
Gibtelecom Limited
Board of Directors: Joe Holliday (President),Tim Bristow, Dilip D. Tirathdas, Dr Jožko Peterlin, Zoran
Vehovar, MSc and Brigita Boh, MSc
CEO: Tim Bristow
Note: Management and governance are realised in line with the relevant legislation in Gibraltar.
13
SIOL, d. o. o., Croatia
Managing Director: Janez Marovt
Opomba: Management and governance are realised in line with the relevant legislation in Croatia.
On.net, d. o. o., Skopje
Managing Director: Klavdij Godnič
Procurator: Janez Marovt
Opomba: Management and governance are realised in line with the relevant legislation in Macedonia.
SIOL, B.V. in liquidation
Liquidator: Barbara Kozarić
Note: Management and governance are realised in line with the relevant legislation in the Netherlands.
The company is in liquidation since 26 May 2010.
One, d. o. o., Skopje
Managing Director: Klavdij Godnič
Notes: Management and governance are realised in line with the relevant legislation in Macedonia.
Dejan Kalinikov tendered his resignation on 17 January 2011 and was relieved of his position as director by the general meeting. The
company will have only one director owing to a change in its governance.
One to One, AD, Skopje
Board of Directors: Klemen Ramoveš (Executive Director); Janez Marovt, Barbara Kozarić (Non-Executive
Directors)
Notes: Management and governance are realised in line with the relevant legislation in Macedonia.
Dejan Kalinikov and Tatjana Veljkovikj tendered their resignations from their positions on the Board of Directors on 17 January 2011.
They were relieved by the general meeting and replaced by Janez Marovt and Barbara Kozarić.
Digi Plus Multimedia Company Telecommunication Services Skopje LTD
Managing Director: Janez Marovt
Note: Management and governance are realised in line with the relevant legislation in Macedonia.
5
SIGNIFICANT EVENTS IN THE PERIOD JANUARY – MARCH 2011
January
-
The Serbian company Pogodak, d. o .o., Belgrade, which is fully owned by the subsidiary Najdi,
informacijske storitve, d. o. o., begins liquidation proceedings on 11 January 2011. For this reason, the
company's name is changed to Pogodak, d. o. o., Belgrade – in liquidation.
Cankarjev Dom thanks its sponsors and donators, and presents Mobitel an award for its more than 15
years of loyalty.
Students from the Faculty of Electrical Engineering visit Mobitel and are briefed primarily on the
technological aspect of the company's operations.
Telekom Slovenije, d. d. becomes owner of an additional 5.09% participating interest in the
Macedonian company One, d. o. o., Skopje on 12 January 2011 via a capital increase carried out in
December 2010.
February
-
Mobitel, d. d. and Microsoft organise the M:Windows Phone 7 competition for best Slovenian
applications for mobile phones with the Windows Phone 7 operating system.
At its regular session, the Supervisory Board of Telekom Slovenije is briefed on the next steps in the
merger of Mobitel and Telekom Slovenije, which it approves unanimously.
Telekom Slovenije digitalises its cable TV service in line with current trends in optical fibre networks
and cable systems.
Coinciding with the European Data Protection Day, Avtenta.si receives the ISO/IEC 27000 information
security certificate, as recognition of its high level of personal data security.
Telekom Slovenije introduces the SiOL BOX S TV communicator, which offers an advanced digital TV
experience and is a somewhat simpler version of the SiOL BOX.
14
-
Mobitel presents awards in the scope of the M:Android competition.
Mobitel, Telekom Slovenije and SiOL receive the title of Trusted Brand 2010.
GVO is again successful in the second tender for the co-financing of the construction of open
broadband networks. Broadband networks with a total value of EUR 28.7 million will be built in seven
municipalities in the Dolenjska and Štajerska regions. With the construction of open broadband
networks, the importance of the telecommunication network operator in Slovenia is increasing. By the
end of next year, the operator will manage broadband networks in at least 17 Slovenian municipalities.
These networks will cover more than 13,000 FTTH connections.
March
-
Mobitel receives the prestigious Advertiser of the Year award for 2010 at this year's Slovenian
Advertising Festival.
The 18th General Meeting of Telekom Slovenije is held on 24 March 2011 at the request of
shareholders, who together represent 5.82% of the company's share capital. The proposed
authorisation for the Management Board to purchase treasury is discussed but rejected, while the
proposal for a special audit of operations in the last five years is adopted by the General Meeting.
6
SIGNIFICANT EVENTS AFTER THE BALANCE-SHEET DATE
April
-
-
-
Planet 9, d. o. o. is merged with Najdi, informacijske storitve, d. o. o. and ceases operations on 1 April
2011. The company's Managing Director is Rudolf Skobe, MSc.
Following exhaustive preparations and coordination, the Supervisory Board approves the Telekom
Slovenia Group's strategic plan for the period until 2015.
The President of Telekom Slovenije's Management Board Ivica Kranjčevič and Mobitel's CEO Zoran
Janko, and the president of Telekom Slovenije's trade union confederation Milan Richter and the
president of Mobitel's Sineks trade union Dean Žigon sign a collective agreement for the newly merged
company.
The Supervisory Board of Telekom Slovenije discusses and approves the audited consolidated annual
report of the Telekom Slovenia Group for 2010. At the same time, the Supervisory Board drafts a
proposal on the use of distributable profit for the upcoming General Meeting. According to the
aforementioned proposal, the gross dividend per share will amount to EUR 3. The Supervisory Board
also confirms the strategic plan of the Company and the Group until 2015.
Mobitel successfully completes its project to implement the IPv6 internet protocol in its network and
commercial offer, making it one of the first mobile operators in the world to introduce this protocol.
Following extensive functional testing, IPv6 is now commercially available to all of Mobitel's users, who
already have access to content from the IPv6 address space. The latter is crucial for the future of the
internet or the so-called "Internet of Things", as the the IPv4 address space, on which today's internet is
based, is practically full. The transition to IPv6 is one of the most strategically important technological
advances of recent years, and facilitates the continued provision of the most state-of-the-art services
via the best and most secure network.
May
-
-
-
SiOL's most popular package in recent times, Trio 10M, with high-speed internet access, is joined by
the Trio 4M package, which offers transfers speed of up to 4 Mb per second, numerous TV
programmes and an extensive video store, as well as free calls between 140,000 SiOL telephony
users. A special promotional price is being offered for both trio packages until the end of May.
For persons who are only now learning about the internet, Telekom Slovenije prepared the SiOL
Začetek (SiOL Beginner) package some time ago. The package includes the delivery and installation of
the requisite equipment, and basic internet training at home. In April Telekom Slovenije took this
concept a step further, and developed the Prvi vstop (First Access) package for beginners. The
subscriber receives a USB key that contains a special, but very simple operating system, which
facilitates only the most basic functions, such as surfing the web, email, and the creation of folders to
save multimedia files (e.g. pictures, movies and music) and notes.
In June Telekom Slovenije will reward subscribers by increasing internet access speeds throughout
Slovenia. Depending on the selected SiOL package (including internet or including internet, TV and
associated technologies), speeds will be increased to as much as 15 Mbit/s.
15
7
FINANCIAL STATEMENTS OF THE TELEKOM SLOVENIA GROUP AND
TELEKOM SLOVENIJE, D. D. FOR THE PERIOD JANUARY – MARCH 2011
7.1
Introductory notes
The consolidated financial statements of the Telekom Slovenia Group and the financial statements of the
parent company Telekom Slovenije, d. d. for the reported period and the comparable period last year were
compiled in accordance with:
• the provisions of the Companies Act,
• the International Financial Reporting Standards (IFRS), adopted by the International Accounting
Standards Board (IASB), and
• the interpretations of the International Financial Reporting Interpretations Committee (IFRIC).
In terms of consolidating EU standards, on the balance sheet date there were no differences in the
accounting policies of the Telekom Slovenia Group and Telekom Slovenije, d. d. between the IFRS as
applied and the IFRS as adopted by the European Union.
The accounting policies used in the compilation of the interim condensed financial statements are the same
as those applied in the compilation of the financial statements for the financial year ending 31 December
2010, with the exception of newly adopted or revised standards and interpretations that entered into force
on 1 January 2011 and are presented below. The observation of the new standards and interpretations did
not have an impact on the financial position or operations of the Telekom Slovenia Group or Telekom
Slovenije, d. d. during the reporting period.
The financial statements have been prepared on a historical cost basis, except for available-for-sale assets
and derivative financial instruments, which are disclosed at fair value, and specific classes of property,
plant and equipment, which were revalued to fair value in accordance with IAS 16.
There was no authorised capital or conditional share capital increase during the reporting period.
The operations of the Telekom Slovenia Group and Telekom Slovenije, d. d. are not seasonal.
All items in the financial statements of the Telekom Slovenia Group and Telekom Slovenije, d. d. are
disclosed in euros, rounded to thousand euro units.
Newly adopted standards and interpretations and improvements thereto
• IAS 24 Related Party Disclosures
• IAS 32 – Financial Instruments: Presentation – Clarification regarding rights to purchase shares
• IFRIC 14 Prepayments of a minimum funding requirement (amendment)
Improvements published in May 2010 and adopted by the EU
The IASB published improvements to the IFRS in May 2010, and issued a package of amendments to the
standards. These amendments entered into force for annual periods beginning on 1 July 2010 or 1 January
2011:
• IFRS 3 Business Combinations
• IFRS 7 - Financial Instruments: Disclosure
• IAS 1 Presentation of Financial Statements
• IAS 27 - Consolidated and Separate Financial Statements
• IAS 34 Interim Financial Reporting
• IFRIC 13 Customer Loyalty Programmes
In accordance with the IFRS, the Company (Group) must take the following updated and revised standards
and interpretations into consideration for future periods should they be adopted by the EU:
• IFRS 1 First-time Adoption of the International Financial Reporting Standards: Moderate
hyperinflation and the abolishment of fixed transition dates for first-time adopters
16
•
•
IFRS 9 Financial Instruments
IAS 12 Deferred Tax (amended)
The Group and the Company have not applied the early adoption of any standards or interpretations not yet
effective that will become effective in the future. The effects of standards and interpretations that are not yet
mandatory are being reviewed. At this moment, the impact of the new requirements cannot be reasonably
assessed. However, the new standards and new interpretations will be applied in accordance with the
relevant requirements.
Company
State
31.3.2011
MOBITEL, d.d.
Slovenia
100%
GVO, d.o.o.
Slovenia
100%
Skupina Najdi
Slovenia
100%
AVTENTA.SI d.o.o.
Slovenia
100%
SOLINE d.o.o.
Slovenia
100%
PLANET 9 d.o.o.
Slovenia
100%
Skupina IPKO, Kosovo
Kosovo
ON.NET DOO Skopje
Macedonia
ANEKS d.o.o. Banja Luka
Bosnia and Herzegovina
70%
PRIMO Communications Sh.p.k
Albania
75%
SIOL d.o.o.
Croatia
100%
Skupina SIOL B.V.
The Netherlands
100%
ONE DOO Skopje
Macedonia
25.62%
ONE TO ONE AD Skopje
Macedonia
100%
DIGI PLUS MULTIMEDIA DOOEL Skopje
Macedonia
100%
93.11%
100%
Mobitel, d. d. is the 100% owner of the subsidiary Soline, Pridelava, soli d. o. o. The company also holds a
50% participating interest in M-Pay, d. o. o.
The Najdi Group comprises the parent company Najdi, informacijske storitve, d. o. o., which holds a 100%
participating interest in the subsidiaries Pogodak tražilica, d. o. o. (in liquidation) in Croatia and Pogodak, d.
o. o., Belgrade in Serbia, and a 50.1% participating interest in the subsidiary Meganet, d. o. o., Slovenia.
Within the Ipko Group, the parent company Ipko Telecommunications, d. o. o. holds a 100% participating
interest in N.B. Media Works, d. o. o., Kosovo. Telekom Slovenije, d. d.'s participating interest is 93.11%.
The parent company holds a call option and the minority shareholders hold a put option for the remaining
participating interest in the company.
Within the SIOL B.V. Group, the parent company SIOL B.V. (in liquidation) holds a 74.38% participating
interest in One, d. o. o., Skopje. The remaining participating interest of 25.62% is held by Telekom
Slovenije, d. d.
Telekom Slovenije, d. d. holds a 100% economic ownership in all of its subsidiaries through call options
acquired from and put options granted to minority shareholders.
A 50% participating interest in Gibtelecom Limited represents an investment in a joint venture. Gibtelecom
and M-Pay,
d. o. o. are included in the consolidated financial statements according to the equity method.
17
7.2
Condensed unaudited financial statements of the Telekom Slovenia Group for the period
January – March 2011
Consolidated income statement for the period ending 31 March 2011
in thousand EUR
Revenue
Other income
I - III 2011
I - III 2010
Index
11/10
193,992
202,694
96
2,082
728
286
196,074
203,422
96
1,127
856
132
-11,546
-10,126
114
-4,718
-4,076
116
Cost of services
-70,079
-76,920
91
Staff costs
-35,109
-39,491
89
Depreciation and amortisation
-49,568
-53,969
92
Total operating revenue
Share of profit of a joint venture
Cost of goods and materials sold
Cost of raw materials and consumables
Other operating expenses
-3,259
-8,323
39
-174,279
-192,905
90
22,922
11,373
202
2,247
937
240
Finance cost
-5,437
-9,888
55
Profit before tax
19,732
2,422
815
Income tax expense
-5,249
-3,055
172
Net profit/loss for the period
14,483
-633
-
2.23
-0.1
-
Total operating expenses
Profit from operations
Finance income
Earnings per share - basic and diluted in
EUR
18
Consolidated statement of comprehensive income for the period ending 31 March 2011
in thousand EUR
Index
11/10
I - III 2011
I - III 2010
14,483
-
-369
-633
-292
74
58
-
-295
-234
-
Changes in fair value of cash flow hedges
0
-1,132
-
Deferred tax
0
15
-
Reclassification of changes in fair value of cash flow hedges
0
1,055
-
Net gain on changes in fair value of cash flow hedges
0
-62
-
Changes in fixed assets revaluation reserve
0
39,627
-
Deferred tax from changes in fixed assets revaluation
reserve
0
-7,925
-
Net profit for the period
Revaluation of avaiable-for-sale financial assets
Deferred tax
Net gain from revaluation of available-for-sale financial
assets
Net gain from fixed assets revaluation reserve
-
0
31,702
-
F/X reserve
-3,022
2,092
-
Other comprehensive income
-3,317
33,498
-
Total comprehensive income
11,166
32,865
34
19
Consolidated balance sheet as at 31 March 2011
in thousand EUR
31.3.2011
31.12.2010
Index
11/10
155,370
162,867
95
ASSETS
Intangible assets
Property,plant and equipment
1,075,299
1,108,408
97
Investment in joint venture
41,006
41,023
100
Other investments
14,105
12,350
114
Other non-current assets
24,896
24,725
101
Investment property
6,391
6,413
100
Deferred tax assets
18,869
18,681
101
1,335,936
1,374,467
97
Total not-current assets
Assets held for sale
5,505
5,688
97
25,657
20,955
122
196,414
196,724
100
729
276
264
Current financial assets
36,668
13,392
274
Cash and cash equivalents
41,995
46,726
90
Inventories
Current trade and other receivables
Income tax receivable
Total current assets
306,968
283,761
108
1,642,904
1,658,228
99
272,721
272,721
100
-3,671
-3,671
100
Reserves
357,978
357,620
100
Retained earnings
117,153
102,287
115
75,665
76,513
99
1,822
2,117
86
-2,797
818,871
225
807,812
101
8,873
9,549
93
36,933
37,814
98
28
31
90
Interest bearing borrowings
155,367
131,224
118
Other non-current financial liabilities
311,968
312,221
100
Total assets
EQUITY AND LIABILITIES
Issued capital
Treasury shares
FA revaluation reserve
Revaluation reserves for financial instruments
F/X reserves
Total capital and reserves
Non-current deferred income
Provisions
Non-current trade and other payables
Deferred tax liabilities
9,589
9,621
100
522,758
500,460
104
140,890
153,317
92
885
5,590
16
90,162
125,451
72
Other current liabilities
19,225
17,042
113
Deferred income
22,889
22,913
100
Accruals
27,224
25,643
106
Total current liabilities
301,275
349,956
86
Total liabilities
824,033
850,416
97
1,642,904
1,658,228
99
Total non-current liabilities
Trade and other payables
Income tax payables
Total equity and liabilities
20
Consolidated statement of changes in equity for the period ending 31 March 2011
in thousand EUR
Balance at 1.1.2011
Issued
capital
272,721
Treasury
shares
-3,671
Retain
earnings
102,287
Reserves
357,620
Profit for the period
FA revaluation
reserves
76,513
F/X
difference
reserves
225
0
0
0
14,483
0
358
490
-848
Payment of dividends
-295
0
-3,022
-3,317
-3,022
11,166
0
-85
Other
-85
-22
272,721
-3,671
357,978
Total
807,812
14,483
-295
Transfer to retained earnings
Balance at 31.3.2011
Net gain or
loss on
changes in
fair value of
cash flow
hedges
0
14,483
Net gain or
loss on
revaluation
of AFS
financial
assets
2,117
-22
117,153
75,665
1,822
0
-2,797
818,871
Net gain or
loss on
revaluation
of AFS
financial
assets
2,294
Net gain or
loss on
changes in
fair value of
cash flow
hedges
-779
F/X
difference
reserves
-2,961
Total
1,001,566
Consolidated statement of changes in equity for the period ending 31 March 2010
in thousand EUR
Balance at 1.1.2010
Issued
capital
272,721
Treasury
shares
-3,671
Retain
earnings
111,433
Reserves
573,531
Profit for the period
-633
0
0
Depreciation transfer for revalued fixed assets
-633
31,702
-234
-62
2,092
33,498
-234
-62
2,092
32,865
0
-633
31,702
358
513
-871
Payment of dividends
0
-75
Other
Balance at 31.3.2010
FA
revaluation
reserves
48,998
-75
21
272,721
-3,671
573,889
111,259
21
21
79,829
2,060
-841
-869
1,034,377
Consolidated statement of cash flows for the period ending 31 March 2011
I - III 2011
I - III 2010
19,732
2,422
49,568
22
319
1,055
-106
-2,247
5,437
183
-745
-149
-4,702
-881
-700
1,581
-20,576
-3,949
43,842
53,969
11
102
0
-104
-937
9,888
0
-12,608
1,818
-1,254
1,940
474
6,215
-28,369
-7,542
26,025
Proceeds from investing activities
Proceeds from sale of PPE
Dividends received
Interest received
Proceeds from sale of current financial assets
Disbursements from investing activities
Purchase of property, plant and equipment
Purchase of intangible assets
Purchase of investment property
Purchase of financial assets
Investments in subsidiaries and joint ventures net of cash
acquired
and acquision of minority interests
Interest bearing loans
6,515
807
1,385
217
4,106
-42,829
-16,536
-1,647
0
-24,646
366
35
289
42
0
-28,028
-21,301
-3,601
0
0
0
-3,124
0
-2
Net cash flow from investing activities
-36,314
-27,662
Proceeds from financing activities
Receipts from other financial liabilities
Receipts from treasury share sale
Proceeds from non-current borrowings
Proceeds from current borrowings
Bonds issued
Disbursements from financing activities
Treasury shares purchase
Repayment of current borrowings
Repayment of non-current borrowings
Sale of derivative financial instruments
Interest paid
Dividends paid
0
0
0
0
0
0
-12,259
0
-1,013
-10,247
-34
-961
-4
5,493
0
0
0
5,493
0
-14,889
0
-843
-8,795
0
-5,247
-4
Net cash flow from financing activities
-12,259
-9,396
-4,731
-11,033
41,995
10,177
46,726
21,210
Profit before tax
Adjustments for:
Depreciation of investment property
Loss on disposal and impairment of intangible assets and PPE
Revaluation adjustments of receivables
Gains/loss on disposal of FA
Finance income
Finance cost
Change in assets held for sale
Change in trade and other receivables
Change in other non-current assets
Change in inventories
Change in provisions
Change in deferred income
Change in accruals
Change in trade and other payables
Tax paid
Net cash flow from operating activities
22
Segment reporting
The Telekom Slovenia Group amended its segment reporting on 1 January 2011. The following
represent operating segments for which data is reported: Slovenia, Macedonia, Kosovo and other
countries, where the criterion for segment reporting is the registered office where an activity is
performed by an individual company.
The disclosure of operations by segment is based on the financial statements of the Telekom Slovenia
Group. Sales between segments are carried out at market value.
I - III 2011
in thousand EUR
External sales
Inter segment revenue
Other revenue
Total operating
revenue
Share of income from
joint ventures
Operating expenses
Eliminations
and
adjustments
Slovenian
market
Macedonian
market
Kosovo
Other
168,385
13,094
10,499
2,014
30,445
3,066
4,973
2,631
-41,115
0
1,919
500
40
8
-385
2,082
200,749
16,660
15,512
4,653
-41,500
196,074
193,992
1,127
-174,859
-22,336
-14,658
-4,815
42,389
28,488
1
Profit before tax
Segment assets
Consolidated
-174,279
19,732
1,352,467
204,148
158,556
- 100.755
1,642,904
1. Asset reporting by segment does not include loans amounting to EUR 11,620 thousand, other financial assets amounting to EUR 27,322, deferred tax assets amounting
to EUR 18,869 thousand, claims for income taxes amounting to EUR 729 thousand or the elimination of inter-company relationships amounting to EUR -159,295 thousand.
I – III 2010
in thousand EUR
External sales
Inter segment revenue
Other revenue
Total operating
revenue
Share of income from
joint ventures
Operating expenses
Eliminations
and
adjustments
Slovenian
market
Macedonian
market
Kosovo
Other
177,821
14,223
8,485
2,165
38,353
2,965
7,346
2,701
-51,365
0
697
13
0
20
-2
728
216,871
17,201
15,831
4,886
-51,367
203,422
202,694
856
-199,711
-22,537
-14,028
-4,863
48,234
28,019
1
Profit before tax
Segment assets
Consolidated
-192,905
2,422
1,443,463
182,081
192,456
86.024
1,932,043
1. Asset reporting by segment does not include loans amounting to EUR 1,176 thousand, deferred tax assets amounting to EUR 14,008 thousand, claims for income taxes
amounting to EUR 9,814 thousand or the elimination of inter-company relationships amounting to EUR 61,026 thousand.
23
Notes to the consolidated financial statements
Sales revenue
in thousand EUR
I - III 2011
I - III 2010
27,399
37,395
2,131
1,752
Mobile telephone services
83,930
75,214
Internet and broadband access
25,786
24,682
Interconnection
10,486
11,319
International operator services
14,507
18,729
Leased lines and data transmission
11,285
11,912
Unbundled access and co-locations
2,550
2,529
Voice services with added value
841
768
Network construction and maintenance
804
3,338
Sale of advertising space
1,513
1,563
Other services
4,161
3,576
Revenue from sale of merchandise
7,970
9,156
Other revenue
629
761
Total revenue
193,992
202,694
Voice
Voice transfer through IP network
Sales revenue was down EUR 8,702 thousand or 4%, to stand at EUR 193,992 thousand. Traditional
voice telephony and international operator services accounted for the majority of the decline, while
sales revenue from mobile telephony was up.
Costs of services
in thousand EUR
I - III 2011
I - III 2010
Cost of communication and transportation services and rent
5,208
4,513
Cost of maintenance
9,352
7,185
27,154
30,864
Costs of multimedia services and content
4,345
4,120
Cost of leased lines
1,600
1,630
Cost of professional services
3,545
3,960
Cost of insurance, marketing and entertainment
6,430
6,290
Cost of sale commission
2,305
2,058
Cost of sale incentives
5,289
6,592
Cost of other services
4,851
9,708
Total cost of services
70,079
76,920
Cost of telecommunication services
Costs of services were down 9%, the costs of telecommunications and other services recording the
largest decreases, while maintenance costs were up.
24
Profit
Earnings before interest and tax (EBIT) doubled compared with the same period last year to reach
EUR 22,922 thousand. A net profit of EUR 14,483 thousand was achieved (an increase of EUR
15,116 thousand on the same period in 2010), despite a net financial loss of EUR 3,190 thousand.
Intangible assets
Intangible assets were down by the total amount of EUR 7,497 thousand, primarily as the result of
amortisation charged during the accounting period. Commitments for intangible assets totalled EUR
1,479 thousand as at 31 March 2011.
Property, plant and equipment
Property, plant and equipment were down by the total amount of EUR 33,109 thousand, primarily as
the result of amortisation charged during the accounting period. Commitments for property, plant and
equipment totalled EUR 10,046 thousand as at 31 March 2011.
Inventories
Inventories were up EUR 4,702 thousand or 22%, primarily at the parent company and at Mobitel, d. d.
Current financial assets were up EUR 23,276 thousand on the balance as at 31 December 2010 to
reach EUR 36.668 thousand, primarily as the result of an increase in the parent company's bank
deposits (up EUR 16,000 thousand) and a time deposit at Banka Celje.
Foreign currency translation reserves
Foreign currency translation reserves were up EUR 3,022 thousand owing to the conversion of the
financial statements of foreign companies.
Financial liabilities
Financial liabilities totalled EUR 576,722 thousand as at 31 March 2011, representing a decrease of
EUR 9,216 thousand on the end of the 2010, broken down as follows:
- borrowings received in the amount of EUR 245,529 thousand were down EUR 11,146
thousand owing to repayments during the accounting period;
- liabilities for bonds issued in the amount of EUR 300,800 thousand were up EUR 3,749
thousand on the balance at the end of the year on account of the associated accrued
interest; and
- liabilities for additional purchases of participating interests in subsidiaries, liabilities for
finance leases and liabilities for interest rate swaps in the amount of EUR 30,393.
Operating and other liabilities
The decline of EUR 12,427 thousand in operating and other liabilities was primarily the result of a
decrease in trade payables.
Transactions with related parties
Related parties of the Group include the Republic of Slovenia as the majority shareholder of Telekom
Slovenije, d. d., other shareholders, the Management Board, members of the Supervisory Board and
their family members.
Transactions with related individuals
Natural persons (the President and members of the Management Board, and the President and
members of the Supervisory Board) held 564 shares in Telekom Slovenije, d. d., representing a
holding of 0.01%. There were no loans approved to related individuals during the first quarter of 2011.
Transactions with the Government of the Republic of Slovenia, and entities and institutions
under its control
Group companies provide telecommunication services to the Government of the Republic of Slovenia
and to various bodies, agencies and companies in which the Slovenian state is either the majority or
minority shareholder. All such transactions are concluded under normal commercial terms and
conditions that are no more favourable than those concluded with other customers.
25
7.3
Condensed unaudited financial statements of Telekom Slovenije, d. d. for the period
January – March 2011
Income statement of Telekom Slovenije, d. d. for the period ending 31 March 2011
in thousand EUR
Revenue
Other income
I - III 2011
I - III 2010
Index
11/10
91,012
97,260
94
253
117
295
Total operating revenue
91,307
97,513
94
Cost of goods and materials sold
-1,821
-1,821
100
Cost of raw materials and consumables
-1,974
-1,894
104
Cost of services
-39,571
-44,435
89
Staff costs
-15,730
-18,404
85
-22,200
-21,711
102
-67
-4,214
2
-81,363
-92,479
88
9,944
5,034
198
Finance income
12,071
3,845
314
Finance cost
-4,988
-7,874
63
Profit before tax
17,027
1,005
-
Income tax expense
-2,189
-155
-
Net profi/loss for the period
14,838
850
-
2.28
0.13
-
Other operating expenses
Total operating expenses
Profit from operations
Earnings per share - basic and diluted in
EUR
26
Statement of comprehensive income for the period ending 31 March 2011
in thousand EUR
Index
11/10
I - III 2011
I - III 2010
14,838
0
850
-91
-
Deferred tax
Net gain from revaluation of available-for-sale
financial assets
0
18
-
0
-73
Changes in fair value of cash flow hedges
0
-1,132
Deferred tax
0
15
Reclassification of changes in fair value
cash flow hedges
0
1,055
Net gain on changes in fair value of cash flow hedges
0
-62
Changes in fixed assets revaluation reserve
0
39,627
Deferred tax from changes in fixed assets revaluation
reserve
0
-7,925
Net gain grom fixed assets revaluation reserve
0
31,702
0
31,567
-
14,838
32,417
46
Revaluation of available-for-sale financial assets
27
-
-
-
Balance sheet of Telekom Slovenije, d. d. as at 31 March 2011
in thousand EUR
31.03.2011
ASSETS
Intangible assets
31.12.2010
Index
11/10
26,280
28,730
91
598,531
612,739
98
Investment in subsidiares and joint ventures
273,614
273,614
100
Other investments
244,378
195,486
125
Other non-current assets
11,484
11,457
100
Deferred tax assets
10,893
10,780
101
1,165,180
1,132,806
103
5,505
5,688
97
Total not-current assets
Non-cerrent assets held for sale
Inventories
9,184
7,017
131
Current trade and other receivables
79,964
73,010
110
46,047
74,336
62
Cash and cash equivalents
16,536
25,249
65
157,236
185,300
85
1,322,416
1,318,106
100
272,721
272,721
100
-3,671
-3,671
100
251,571
251,213
100
Retained earnings
44,828
29,500
152
Fixed assets revaluation reserves
70,742
71,590
99
Total current assets
Total assets
EQUITY AND LIABILITIES
Issued capital
Treasury shares
Reserves
Financial instruments revaluation reserve
184
184
100
636,375
621,537
102
8,095
8,577
94
21,022
21,889
96
522
525
99
154,548
130,338
119
Other non-current financial liabilities
307,777
308,001
100
9,499
9,621
99
501,463
478,951
105
62,540
70,483
89
645
3,802
17
87,717
116,001
76
Other current financial liabilities
18,703
15,943
117
Deferred income
7,470
7,287
103
Accruals
7,503
4,102
183
Total current liabilities
184,578
217,618
85
Total liabilities
686,041
696,569
98
1,322,416
1,318,106
100
Total capital and reserves
Non-current deferred income
Provisions
Non-current operating liabilities
Deferred tax liabilities
Total non-current liabilities
Trade and other payables
Income tax payables
Total equity and liabilities
28
Statement of changes in equity of Telekom Slovenije, d. d. for the period ending 31 March 2011
in thousand EUR
Balance at 1 Jan 2011
Issued
capital
Treasury
shares
Reserves
Retain
earnings
Fixed assests
revaluation
reserve
272,721
-3,671
251,213
29,500
71,590
Net gain or loss
on revaluation
of available-forsale financial
assets
184
Net change in
fair value of
hedging
financial
instruments
0
14,838
0
0
0
Transfer to retained earnings and reserves
Balance at 31 Mar 2011
621,537
14,838
Other comprehensive income for the period
Total comprehensive income for the period
Total
272,721
-3,671
0
14,838
0
358
490
-848
251,571
44,828
70,742
0
0
14,838
0
184
0
Net gain or loss
on revaluation
of available-forsale financial
assets
115
Net change in
fair value of
hedging
financial
instruments
-779
636,375
Statement of changes in equity of Telekom Slovenije, d. d. for the period ending 31 March 2010
in thousand EUR
Balance at 1 Jan 2010
Issued
capital
Treasury
shares
Reserves
Retain
earnings
Fixed assests
revaluation
reserve
272,721
-3,671
461,372
70,141
44,016
850
Other comprehensive income for the period
Total comprehensive income for the period
0
0
Transfer to retained earnings and reserves
Balance at 31 Mar 2010
272,721
-3,671
843,915
850
31,702
-73
-62
31,567
-73
-62
32,417
0
850
31,702
358
497
-855
461,730
71,488
74,863
29
Total
0
42
-841
876,332
Cash flow statement of Telekom Slovenije, d. d. for the period ending 31 March 2011
in thousand EUR
I - III 2011
I - III 2010
17,027
1,005
22,200
0
-61
-52
21,711
98
0
-76
-12,071
4,988
-3,845
7,874
183
-6,893
-140
-2,167
0
209
-337
-198
-867
-299
3,401
-13,217
-455
2,015
-399
12
-15,447
-2,780
11,577
9,842
15,313
566
6,300
786
1,850
5,811
11,672
0
214
1,378
0
10,080
Disbursements from investing activities
Purchase of property, plant and equipment
Purchase of intangible assets
Purchase of financial assets
Investments in subsidiaries and joint ventures
Interest bearing loans
Cash used in investing activities
Cash flows from financing activities
Rreceipts from financing activities
Proceeds from current borrowings
-30,401
-5,231
-506
-24,646
-7
-11
-15,088
-15,241
-9,280
-827
0
-3,124
-2,010
-3,569
6,000
6,000
4,760
4,760
Disbursements from financing activities
Repayment of current borrowings
Repayment of non-current borrowings
Interest paid
Dividends paid
Cash flow from/used in financing activities
-11,202
0
-10,083
-1,115
-4
-13,767
-8,768
0
-4,995
-4
-5,202
-9,007
Net increase in cash and cash equivalents
-8,713
-2,734
Closing balance of cash
16,536
2,412
Opening balance of cash
25,249
5,146
Cash flows from opearting activities
Profit before tax
Adjustments for:
Impairment and write-offs of fixed assets
Movement in bad debt allowances
Gains/loss on disposal of property, plant and equipment
Finance income
Finance expense
Change in assets held for sale
Change in trade and other receivables
Change in other non-current assets
Change in inventories
Change in provisions
Change in deferred income
Change in accruals
Change in trade and other payables
Income tax paid
Net cash from operating activities
Cash flow from Investing activities
Receipts from investing activities
Proceeds from sale of fixed assets
Dividends received
Interest received
Disposal of non-current investments
Disposal of current investments
30
Notes to the financial statements of Telekom Slovenije, d. d.
Sales revenue
in thousand EUR
Voice telephony
Voice transfer through IP network
Internet and broadband access
Interconnections
I - III 2011
I - III 2010
26,394
30,126
1,551
1,460
21,823
20,442
5,811
5,341
International operator services
15,005
18,878
Bandwidth lease and data transfer services
12,068
12,765
Unbundled access and collocations
2,598
2,574
Voice services with added value
1,050
993
73
99
Other services
2,014
2,175
Sale of merchandise and materials
Sale of advertising space
2,500
2,297
Other revenue
125
110
Total revenue
91,012
97,260
Net sales revenue was down 6% on account of traditional voice telephony and international operator
services. The drop in traditional voice telephony is expected, and is being offset by VoIP telephony
Costs of services
in thousand EUR
I - III 2011
I - III 2010
Communication and transport services and rent
1,281
1,183
Maintenance
4,758
4,605
18,793
23,369
Multimedia content
7,854
7,913
Leased lines
1,436
1,139
Professional services
1,549
1,448
Insurance, marketing and entertainment
1,307
1,051
387
389
1,004
1,682
Telecommunication services
Sales commission
Sale incentives
Other services
Total cost of services
1,202
1,656
39,571
44,435
Costs of services were down 11% primarily owing to lower costs of telecommunication services
Operating profit
Earnings before interest and taxes (EBIT) totalled EUR 9,944 thousand, and were up EUR 4,910
thousand due to lower costs of services, a decline in other operating expenses and lower labour costs.
Finance income
Finance income was up EUR 8,226 thousand on the same period last year, primarily owing to the
payment of dividends by subsidiaries and an increase in interest income.
31
Finance expenses
Finance expenses were down EUR 2,886 on the same period last year. The reasons lie mainly in a
change in the fair value of derivative financial instruments, which was down EUR 1,205 thousand this
year, and lower interest expenses.
Net profit
Net profit in the amount of EUR 14,838 thousand was up EUR 13,988 thousand on the previous year.
Intangible assets
Intangible assets comprise computer programmes and licences. Intangible assets were down by the
total amount of EUR 2,450 thousand, primarily as the result of amortisation charged during the
accounting period. Commitments for intangible assets totalled EUR 1,576 thousand as at 31 March
2011.
Property, plant and equipment accounted for 45.3% of the Company total assets. The decrease in
property, plant and equipment in the amount of EUR 14,208 thousand was primarily the result of
depreciation charged during the accounting period in the amount of EUR 19,245 thousand, while there
were also some new acquisitions. Commitments for property, plant and equipment totalled EUR 8,641
thousand as at 31 March 2011.
Other financial assets
Loans to subsidiaries represent the majority of other financial assets, the increase in which of EUR
48,892 thousand was primarily due to the refinancing of loans to One, On.net and One to One
(including unpaid interest) in the form of a new long-term loan.
Operating and other receivables
Operating and other receivables amounted to EUR 79,964 thousand as at 31 March 2011. Their
increase on the end of last year in the amount of EUR 6,954 thousand is the result of receivables from
associates, VAT receivables and receivables from foreign operators.
Current financial assets were down EUR 28,289 as the result of the transfer of the short-term portion
of loans to subsidiaries in the amount of EUR 48,855 thousand to long-term (refinancing of loans) and
an increase in bank deposits of EUR 16,000 thousand.
Financial liabilities
Financial liabilities totalled EUR 568,745 thousand as at 31 March 2011, representing a decrease of
EUR 1,538 thousand on the end of the year, broken down as follows:
- borrowings received in the amount of EUR 242,265 thousand were down EUR 4,074
thousand owing to repayments during the accounting period;
- liabilities for bonds issued in the amount of EUR 300,800 thousand were up EUR 3,749
thousand on the balance at the end of the year on account of the associated accrued
interest; and
- liabilities for additional purchases of participating interests in subsidiaries, liabilities for
finance leases and liabilities for interest rate swaps in the amount of EUR 25,680.
Operating and other liabilities
The decline of EUR 7,943 thousand in operating and other liabilities was primarily the result of a
decrease in trade payables in the amount of EUR 11,846 thousand and an increase in VAT liabilities
in the amount of EUR 4,128 thousand.
Financial risk management
The Company uses derivative financial instruments to hedge interest-rate risk encountered in securing
the appropriate financial resources.
According to the balance of long-term borrowings as at 31 March 2011, 28% of the loan value is
hedged against interest-rate risk.
32
33

Unaudited Busi Telekom Slovenia Group for the period

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