Letter from the Chairman of the Board

Dear Sirs/Madams,

It is our pleasure to present the financial statements of the Impexmetal Capital Group for the year 2013. We do hope that the financial results achieved in the previous year will bring you satisfaction and will cause you would  be still present among the shareholders of Impexmetal S.A.

We wish to focuse your attention on the positive occurrences  taking place in the particular companies, having got an influence on the financial results of the whole Capital Group.

In 2013 the sales volumes went up over 6 % compared with the previous year. The total companies’ sales, taking into account products, goods and materials achieved the level of 193 th. tonnes, which was equal to revenues of PLN 2.7 million. The operations results amounted to PLN 73 million and the net profit, including discontinued operations, amounted to PLN 86 million.

The unquestionable achievement in 2013 were results reached in Aluminium and Copper Segments.

The results of Huta Aluminium Konin, the largest Polish producers of aluminium rolled products, prove again that it is one of the most valuable segments in the Capital Group. We note permanent increase of the operations effects, as a effect of the curried development policy, consequently changing the production mix, aiming at products of the highest profitability. In Copper Segment the historical  record sales volume has been achieved by WM Dziedzice S.A., which has resulted in the outstanding financial effects. The other Segment’s company – Hutmen S.A.  realized higher processing margins than in the previous year. We can observe in both companies the improvement of the production effectiveness, particularly  the decrease of the fixed costs, as well as the effects of implementation of the new technology of copper processing.

The situation in  Segment Zinc and Lead is  more complex.

The Company ZM Silesia S.A. has noted, for the consecutive second year,  very good financial results, which has been an effect of high record sales both in rolled products and in the production of zinc white. The Company operates with a hard consequence in finding new receivers for its products. But the better operation effects of ZM Silesia S.A. has been levelled by the lower results of Baterpol S.A. The Company – the producer of lead – has utilized the battery scrap as a basic source for the production of rafined lead. The historical high prices of the battery scrap have had a negative influence on the effects achieved by the Company.

Additionally, we inform with pleasure that the Company FŁT Polska Sp. z o.o. has concluded with a Chinese company Tri-Ring Corporation – a new owner of Fabryka Łożysk in Kraśnik – a strategic agreement on principles of a long term cooperation in the supply of bearings. Taking into account plans of a Chinese owner – double a production in Poland during the next five years – it gives a wide opportunity of development for FŁT Polska Sp. z o.o., and it should bring positive financial effects for the Capital Group.

In 2014 we still work on new products, which may be of a key importance for the effects of the Group. Such investment is, undoubtfully, an investment in Huta Aluminium Konin, being in the latest stage of realization. Its conclusion will allow to offer to our clients high-processed products, which will find its application in the most advanced technological branches.  Our strategy comprises also an investment realized by ZM Silesia S.A., which will effect on enlarging an offer of high-margins products for roofing. Additionally a further modernization is planned using the European funds for the Innovative Economy Operational Programme.   We do trust that  new products prepared for the most perspective industry sectors will allow us to develop not  only the portfolio of the keys clients but   also to increase the obtained margins.   The main purpose of the Management Board in 2014 is further work on development of the Impexmetal Group and building of the Company’s value through improvement of its operations.

We do thank each shareholder for their trust in the way of development presented by the Company. We also want to thank our clients and suppliers for their cooperation and we do hope for its further development in the next years.

I wish to thank all employees and the management – it is your work for the Company  that allows to realize the targets made by the Impexmetal Capital Group.

Małgorzata Iwanejko
Chairman of the Board