Opinion and Report of the Independent Auditor Financial year ended December 31st 2013

Transcription

1 Grupa Azoty Zakłady Chemiczne Police S.A. Opinion and Report of the Independent Auditor Financial year ended December 31st 2013 The opinion contains 2 pages The supplementary report contains 9 pages Opinion of the independent auditor and supplementary report on the audit of the separate financial statements for the financial year ended December 31st KPMG Audyt Sp. z o.o., a Polish limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative ( KPMG International ), a Swiss entity. All rights reserved.

2 KPMG Audyt Sp. z o.o. Phone No.: Poznań Office Fax No.: ul. Roosevelta 18 poznan@kpmg.pl Poznań Website: Poland OPINION OF THE INDEPENDENT AUDITOR To the General Meeting of Grupa Azoty Zakłady Chemiczne Police S.A. Opinion on the separate financial statements We have audited the accompanying separate financial statements of Grupa Azoty Zakłady Chemiczne Police S.A. with registered office at ul. Kuźnicka 1, Police, Poland (the Company ), which comprise the separate statement of financial position as at December 31st 2013, the separate statement of profit or loss and other comprehensive income, the separate statement of changes in equity, and the separate statement of cash flows for the year then ended, and a summary of significant accounting policies and other explanatory information. Management's and Supervisory Board's responsibility The Management Board of the Company is responsible for the correctness of accounting records and for the preparation of the financial statements so as to give a true and fair view in accordance with International Financial Reporting Standards endorsed by the European Union and other applicable regulations, and for the preparation of the Directors' report on the Company's operations. The Company's Management Board is also responsible for such internal control as the Management Board determines is necessary to enable the preparation of separate financial statements that are free from misstatement, whether due to fraud or error. Pursuant to the Accountancy Act of September 29th 1994 (Dz.U. of 2013, item 330, as amended) ("Accountancy Act"), the Company's Management Board and members of the Supervisory Board are required to ensure that the financial statements and the Directors' report on the Company's operations are in compliance with the requirements set forth in the Accountancy Act. Auditor's responsibility Our responsibility is, based on our audit, to express an opinion on these financial statements and the correctness of accounting records used in preparing these financial statements. We conducted our audit in accordance with section 7 of the Accountancy Act, Polish financial auditing standards, issued by the Polish National Council of Statutory Auditors (Krajowa Rada Biegłych Rewidentów), and the International Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether these financial statements and accounting records used in preparing these statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on our judgement, including the KPMG Audyt Sp. z o.o., a Polish limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. KPMG Audyt Sp. z o.o., a Polish limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative ( KPMG International ), a Swiss entity. 1 Registered address: ul. Chłodna 51, Warsaw, Poland Tel.: Registered at the District Court for the Capital City of Warsaw in Warsaw, 12th Commercial Division of the National Court Register KRS Share capital: PLN 125,000 Tax Identification Number (NIP): Industry Identification Number (REGON):

3 assessment of risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, we consider internal control relevant to the entity s preparation of separate financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the Company's Management Board, as well as evaluating the overall presentation of the separate financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, the accompanying separate financial statements of Azoty Zakłady Chemiczne Police S.A. present fairly and clearly the Company's assets and financial standing as at December 31st 2013, its financial performance and cash flows for the year then ended, and have been prepared, in all material respects, in accordance with the International Financial Reporting Standards endorsed by the European Union, are in compliance with the regulations that apply to separate financial statements and with the Company's Articles of Association, and were prepared based on accounting records which are, in all material respects, correctly maintained. Report on other legal and regulatory requirements Directors' report on the Company's operations As required under the Accountancy Act, we acknowledge that the Directors' report on the Company's operations includes, in all material respects, the information required by Art. 49 of the Accountancy Act and the Minister of Finance s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated February 19th 2009, (Dz.U. of 2009 No. 33, item 259, as amended) and that the information is consistent with the separate financial statements. On behalf of KPMG Audyt Sp. z o.o. Reg. No. 458 ul. Chłodna Warsaw, Poland [illegible signature] Marek Gajdziński Lead Auditor Reg. No Partner, Commercial Proxy March 7th 2014 KPMG Audyt Sp. z o.o., a Polish limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. KPMG Audyt Sp. z o.o., a Polish limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative ( KPMG International ), a Swiss entity. 1 Registered address: ul. Chłodna 51, Warsaw, Poland Tel.: Registered at the District Court for the Capital City of Warsaw in Warsaw, 12th Commercial Division of the National Court Register KRS Share capital: PLN 125,000 Tax Identification Number (NIP): Industry Identification Number (REGON):

4 Grupa Azoty Zakłady Chemiczne Police S.A. Supplementary report on the audit of the separate financial statements Financial year ended December 31st 2013 The supplementary report contains 9 pages The supplementary report on the audit of the of the separate financial statements for the financial year ended December 31st KPMG Audyt Sp. z o.o., a Polish limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative ( KPMG International ), a Swiss entity. All rights reserved

5 Contents Grupa Azoty Zakłady Chemiczne Police Group

6 Grupa Azoty Zakłady Chemiczne Police Group 1. General 1.1. Identification of the Company Company name Grupa Azoty Zakłady Chemiczne Police S.A. (until June 3rd 2013: Zakłady Chemiczne Police S.A.) Registered address ul. Kuźnicka 1, Police, Poland Registration in the National Court Register Registry court: District Court in Szczecin, 13th Commercial Division of the National Court Register Date: May 29th 2001 Entry number in the National Court Register: KRS Share capital as at the end of the reporting period: PLN 750,000, Management of the Company The Management Board is responsible for the management of the Company. As at December 31st 2013, the Management Board of the Company was composed of: Krzysztof Jałosiński President of the Management Board, Wojciech Naruć - Vice-President of the Management Board, Rafał Kuźmiczonek - Vice-President of the Management Board Identification of the lead auditor and audit firm Identification of the lead auditor Name and surname: Registration number: Identification of the audit firm Marek Gajdziński Name: KPMG Audyt Sp. z o.o. Address of registered office: ul. Chłodna 51, Warsaw, Poland Entry number in the National Court Register: KRS Registry court: District Court for the Capital City of Warsaw in Warsaw, 12th Commercial Division of the National Court Register Share capital: PLN 125,000 Tax Identification Number (NIP): KPMG Audyt Sp. z o.o. is entered in the register of audit firms maintained by the National Council of Statutory Auditors (Krajowa Rada Biegłych Rewidentów) under Reg. No. 458.

7 Grupa Azoty Zakłady Chemiczne Police Group 1.3. Prior period separate financial statements The separate financial statements of the Company for the financial year ended December 31st 2012 were audited by KPMG Audyt Sp. z o.o. The auditor issued an unqualified opinion. The separate financial statements were approved by the General Meeting held on April 25th The General Meeting resolved to distribute the net profit for the financial year 2012, in the amount of PLN 115,970 thousand, in the following manner: PLN 50,250 to dividend payment and PLN 65,720 to statutory reserve funds. The separate financial statements were filed with the Registry Court on May 7th Scope of the audit and responsibilities of the auditor This report was prepared for the General Meeting of Grupa Azoty Zakłady Chemiczne Police S.A. with registered office at ul. Kuźnicka 1, Police, Poland, and relates to the separate financial statements comprising: the separate statement of financial position as at December 31st 2013, the separate statement of profit or loss and other comprehensive income, the separate statement of changes in equity, and the separate statement of cash flows for the year then ended, and a summary of significant accounting policies and other explanatory information. The audited entity prepares its separate financial statements in accordance with the International Financial Reporting Standards endorsed by the European Union, under a resolution passed by the Extraordinary General Meeting on November 19th The separate financial statements were audited under an agreement of July 5th 2012 executed pursuant to a Supervisory Board's resolution of May 23rd 2012 on the appointment of the auditor. We conducted our audit in accordance with section 7 of the Accountancy Act of September 29th 1994 (Dz.U. of 2013, item 330, as amended) ( Accountancy Act ), Polish financial auditing standards, issued by the National Council of Statutory Auditors (Krajowa Rada Biegłych Rewidentów), and the International Standards on Auditing. We conducted our audit at the registered offices of the Company,

8 Grupa Azoty Zakłady Chemiczne Police Group from November 18th to November 22nd 2013, from January 27th to February 7th 2014, and from February 17th to February 21st The Management Board of the Company is responsible for the correctness of accounting records, for the preparation of the financial statements in accordance with International Financial Reporting Standards endorsed by the European Union and other applicable regulations, and for the preparation of the Directors' report on the Company's operations. Our responsibility is, based on our audit, to express an opinion on these financial statements and prepare a supplementary report on the audit of these separate financial statements and the correctness of accounting records used in preparing the statements. On the date of this report, the Company's Management Board made a statement on fairness and clarity of the attached financial statements and on absence of any events which could have a material bearing on the data presented in the audited separate financial statements but were not disclosed in the statements. In the course of the audit of the separate financial statements, all required statements, explanations and information were provided to us by the Management Board of the Company on our request, and all documents and information necessary to express our opinion and prepare the report were made available to us. The scope of work planned and performed was not limited in any way. The method and scope of our audit is detailed in working documentation prepared by us and retained at the offices of the Audit Firm. The lead auditor and the audit firm meet the independence criteria, as defined in Art and Art of the Act on Qualified Auditors and their Self-Government, Entities Qualified to Audit Financial Statements and Public Supervision, dated May 7th 2009 (Dz.U. of 2009, No. 77, item 649, as amended). 2. Financial analysis of the Company 2.1. Summary analysis of the separate financial statements

9 Grupa Azoty Zakłady Chemiczne Police Group Separate statement of financial position ASSETS Dec % of total Dec % of total PLN '000 assets PLN '000 assets Non-current assets Property, plant and equipment 823, , Investment property 23, , Intangible assets 12, , Investments in subordinated entities 147, , Deferred tax assets 94, , Other non-current assets 2, , Total non-current assets 1,103, , Current assets Inventory 333, , Other financial assets , Trade and other receivables 268, , Cash and cash equivalents 57, , Other current assets 4, , Total current assets 665, , TOTAL ASSETS 1,768, ,543, Dec % of total assets Dec EQUITY AND LIABILITIES PLN '000 PLN '000 Equity % of total assets Share capital 750, , Retained earnings 233, , Total equity Liabilities 983, , Borrowings 42, , Employee benefit obligations 44, , Other non-current payables 57, Other provisions 45, , Government grants 8, , Deferred income Other financial liabilities 3, , Total non-current liabilities 200, , Borrowings 196, , Employee benefit obligations 4, , Trade and other payables 340, , Other provisions 33, , Government grants 1, , Deferred income 5, Other financial liabilities 2, , Total current liabilities 584, , Total liabilities 784, , TOTAL EQUITY AND LIABILITIES 1,768, ,543,

10 Grupa Azoty Zakłady Chemiczne Police Group Separate statement of profit or loss and other comprehensive income Jan 1-Dec PLN '000 % of revenue Jan 1-Dec PLN '000 % of revenue Revenue 2,467, ,956, Cost of sales (2,251,256) 91.2 (2,698,135) 91.3 Gross profit 216, , Selling and distribution expenses (67,466) 2.7 (53,896) 1.8 Administrative expenses (135,035) 5.5 (113,506) 3.8 Other income 50, , Other expenses (6,931) 0.3 (12,341) 0.4 Operating profit 57, , Finance income 13, , Finance costs (16,618) 0.7 (16,454) 0.6 Net finance income/(costs) (3,498) 0.1 2, Profit before tax 53, , Tax expense (11,531) 0.5 (21,115) 0.7 Net profit 42, , Other comprehensive income Items that will never be reclassified to profit or loss Remeasurements of defined benefit obligation 1, Tax on items that will never be reclassified to profit or loss (195) 0.0 Total other comprehensive income Total profit or loss and other comprehensive income 42, , Selected financial ratios 1. Net margin profit for the year x 100% revenue 2. Return on equity profit for the year x 100% equity - profit for the year 3. Average collection period average trade receivables (gross) x 365 days revenue 4. Debt ratio liabilities x 100% total equity and liabilities 5. Liquidity ratio current assets current liabilities % 3.9% 11.7% 4.5% 13.3% 58.0% 27 days 19 days 19 days 44.4% 35.8% 41.5% Revenue includes revenue from sales of products, merchandise and materials. Average trade receivables (gross) is an arithmetical mean of trade receivables as at the beginning and end of the reporting period, before impairment losses.

11 Grupa Azoty Zakłady Chemiczne Police Group 3. Detailed report 3.1. Accounting policies The Company maintains current documentation describing the accounting policies adopted by the Company's Management Board, as required by Art. 10 of the Accountancy Act. In our audit of the separate financial statements, we used audit sampling to assess the correctness of functioning of the Company's accounting policies. During the audit, no material irregularities were identified in the accounting policies which had not been removed and could have a material effect on the audited separate financial statements. Our responsibility did not include expressing of a comprehensive opinion on the functioning of the accounting policies. The Company carried out an inventory-taking of its assets within the deadlines specified in Art. 26 of the Accountancy Act. The results of inventory-taking were accounted for and disclosed in the accounting records Notes to the separate financial statements Information included in the notes to the separate financial statements, comprising a summary of significant accounting policies and other explanatory information, is in all material respects presented correctly and completely. This information is an integral part of the separate financial statements Directors' Report on the Company's operations We acknowledge that the Directors' Report on the Company's operations includes, in all material respects, the information required by Art. 49 of the Accountancy Act and the Minister of Finance s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated February 19th 2009, (Dz.U. of 2009 No. 33, item 259, as amended) and that the information is consistent with the separate financial statements.

12 On behalf of KPMG Audyt Sp. z o.o. Reg. No. 458 ul. Chłodna Warsaw, Poland [illegible signature] Marek Gajdziński Lead Auditor Reg. No Partner, Commercial Proxy March 7th 2014