ADDITIONAL INFORMATION to the abridged financial statements SA-QSr2 / 2006 1. Accounting principles and methods, assets and liabilities valuation methods as of the balance sheet day and profit and loss measurement methods. The financial statements was drawn up according to the following regulations: - The Act on Accounting of September 29 th, 1994 (uniform text Journal of Laws No. 76, item 694, 2002); - The Ordinance of the Council of Ministers of October 19 th, 2005, on current and periodical information communicated by the issuers of securities (Journal of Laws No. 209, item 1744); The principles for drawing up financial statements for Q2 2006 employed by the Company did not change since their last description included in the financial statements for the year 2005 - SA-R 2005. 2. Information on corrections due to provisions and asset component revaluation write-offs. As of June 30 th, 2006, the provisions and assets related to deferred income tax were as follows: provisions related to deferred income tax: in PLN thousand Item Balance on Changes in Q2 Balance on 31.03.2006 30.06.2006 1. non-settled investment relief 1-1 2. revaluation of securities 42 (12) 30 3. estimated income from long-term contracts 5,700 1,819 7,519 4. non-settled positive exchange rate 9 (6) 3 differences 5. capital component related to B series convertible bonds 39 (39) - 6. other 35 101 136 Total provisions related to deferred income tax 5,826 1,863 7,689 assets related to deferred income tax in PLN thousand Item Balance on 31.03.2006 Changes in Q2 Balance on 30.06.2006 1. provisions made 3,490 855 4,345 - non-paid remuneration 1,743 (535) 1,208 - estimated costs of handling B series convertible bonds 396 (396) 0 2. non-settled negative exchange rate differences 16-16 3. estimated costs from long-term contracts 924 948 1,872 4. financial assets revaluation 763 76 839 5. other 2,457 3,335 5,792 Total assets related to deferred income tax 9,789 4,283 14,072 Changes in asset revaluation write-offs during Q2 2006 were as follows:
ComputerLand SA 2 in PLN thousand Item Balance on 31.03.2006 Changes in Q2 Balance on 31.06.2006 1. receivables revaluation 5,014 400 (5,404) 2. financial assets revaluation 6,048 400 6,448 3. other assets revaluation 132-132 Total asset revaluation write-offs 11,194 800 11,984 Selected items in assets and liabilities shown in financial statements were converted into EUR at an average PLN-EUR exchange rate specified by the National Bank of Poland on the balance sheet day. Selected items in the profit and loss account were converted into EUR at an average exchange rate calculated as an arithmetic mean of all average exchange rates specified by the National Bank of Poland on the last day of each month included in the profit and loss account. Average exchange rate January-June Exchange rate on the last day of the period ending on June 30 th 2005 rok 4,0805 4,0401 2006 rok 3,9002 4,0434 3. The ComputerLand SA Capital Group On May 25 th, 2006, an agreement with Emax SA, BBI CAPITAL Spółka Akcyjna and four natural persons being members of the Management Board or the Supervisory Board of Emax SA, i.e. Paweł Turno, Piotr Kardach, Paweł Rozwadowski and Wojciech Dziewolski, was concluded. Pursuant to the Agreement: 1) The Company shall purchase stocks of Emax SA equivalent to 35.70% of Emax SA s stock capital and entitling to place 64.94% of the total number votes on Emax SA s General Assembly from BBI CAPITAL and the Managers, directly or indirectly, and 2) The Company and Emax SA shall take up actions aimed at carrying out a merger of the Company and Emax SA by way of the Company taking over Emax SA in the course of Article 492 Clause 1 Paragraph 1 of the Code of Commercial Companies ( CCC ). The transaction stipulated in the Agreement will consist of the following stages: 1) The Company will purchase 416,888 inscribed preference stocks of Emax SA from BBI CAPITAL and 240 inscribed preference stocks of Emax SA from the Managers for PLN 147.00 each, i.e. for a total amount of PLN 61,317,816.00; 2) In order to enable the Company to purchase the remaining stocks of Emax SA owned by BBI CAPITAL, BBI CAPITAL will create a special purpose vehicle, to which it will transfer 301,292 inscribed preference stocks and 511,955 ordinary bearer stocks of Emax SA. Next the Company will purchase all the stocks in the aforementioned SPV. At the same time the Company will issue 1,000,000 ordinary bearer stocks within the framework of the Company s target capital, pursuant to Article 5a of the Company s Articles of Association and will offer these stocks in a private subscription offer for BBI CAPITAL in exchange for a monetary contribution. The issue price of each stock of the Company issued within the framework of the target capital will amount to PLN 115.00, thus the Company will receive a total amount of PLN 115,000,000.00 within the framework of the target capital. The
ComputerLand SA 3 Company will earmark total cash acquired from the issue of 1,000,000 stocks within the framework of the target capital for paying the purchase price of the SPV. 3) As a result of purchasing stocks of Emax SA from BBI CAPITAL and the Managers in the course as described in paragraphs 1) - 2), the Company will acquire, partially directly and partially indirectly, via a subsidiary company, a stake in Emax SA entitling it to place 64.94% of the total number of votes on Emax SA s General Assembly. 4) The Company and Emax SA shall take up any necessary and advisable actions in order to carry out the merger of the Company and Emax SA by way of the Company taking over Emax SA in the course of Article 492 Clause 1 Paragraph 1 of the CCC. The stock exchange ratio (the parity) will be: (i) 1.28 ordinary bearer stock of the Company for 1 inscribed preference stock of Emax SA and (ii) 1.20 ordinary bearer stock of the Company for 1 ordinary bearer stock of Emax SA. In particular the Management Board of the Company and the Management Board of Emax SA will sign a plan for carrying out the merger of the Company and Emax SA not later than within 8 weeks after the day the increase of the Company s stock capital by way of an issue of 1,000,000 stocks within the framework of the target capital (taken up by BBI CAPITAL) is registered. Pursuant to the Agreement the Management Board of the Company plans the process of purchasing stocks of Emax SA by the Company to be completed in 4Q2006. Moreover, the Management Board of the Company anticipates that the Company s General Stockholder Assembly and Emax SA s General Stockholder Assembly that will pass resolutions on the merger will take place in 2Q2007. The purchase of stocks of Emax SA discussed in paragraphs 1) - 2) will be financed in part with the Company s own funds and in part with a bank credit or the issue of bonds. (ComputerLand SA s Press Release 53/2006 of May 26 th, 2006) On July 27, 2006, it has obtained permission from the Office for Competition and Consumer Protection for the concentration whereunder ComputerLand S.A. will assume control over Emax S.A. with its corporate seat in Poznań and over VBB Sp. z o.o. with its corporate seat in Warsaw. Securing the permission of the President of the Office for Competition and Consumer Protection for the concentration of the Company and Emax S.A., to be executed through the take-over of control over Emax S.A. by ComputerLand S.A. (acquiring more than 50% of the votes in Emax S.A.), is one of the conditions for performance of the Agreement concerning ComputerLand S.A. s acquisition of shares in Emax S.A. and the merger of ComputerLand S.A. with Emax S.A. (as described in the current statement no 53/2006). (ComputerLand SA s Press Release 81/2006 of July 27 th, 2006) 4. Profit and loss accounts, description of significant achievements or failures and most important events that took place in the period subject to this report. As was communicated earlier - ComputerLand incurred a significant loss during the first six months of the year Forecast net profit in the second half-year of 2006 is nearly twice as high as the profit for the whole of 2005 CoLorado and merger with Emax strengthen ComputerLand s market position The Management Board of ComputerLand S.A., in line with the press release of 24 July 2006 which announced a significant loss after the first half-year of 2006 and the
ComputerLand SA 4 presentation of an official forecast for the second half-year of 2006 on 10 August 2006, publicly communicates the forecast of consolidated financial results for the ComputerLand Group. The Management Board forecasts that within the next 6 months the Company shall achieve a net profit of PLN 20 million. The planned results signify that in the second half-year of 2006 the Group will achieve a net profit of almost double the profit for the whole of 2005 (PLN 11.4 million). The Management Board of ComputerLand S.A. took the following issues into account when forecasting the Capital Group s financial results for the second half-year: Projects in ComputerLand Group s strongest sectors, i.e. B&F and Telecom planned for implementation in the second half-year Traditional increase of revenues in State Treasury controlled sectors in the second half-year, especially in the Public and Utilities sectors; Stable income and profits in the Healthcare sector, based on ComputerLand's own software and solutions current value of the order portfolio (over PLN 380 million) The positive effects of the CoLorado efficiency improvement program implemented within the company The first effects of the merger with EMAX, resulting mostly from limiting mutual competitiveness The Company's financial costs being lower than in previous half-years The Management Board of ComputerLand S.A. shall monitor the implementation of the presented forecast day-to-day, based on the actual implementation of the Capital Group s budgets. Evaluation of the possibility of achieving the forecast results shall be carried out quarterly, i.e. together with the public communication of the quarterly consolidated reports. The Management Board of the Company, taking into account the consistently implemented CoLorado efficiency improvement project, the timely merger with Emax and political stabilization resulting in an increase in the number of orders from State Treasury-controlled sectors, assumes that the ComputerLand Group is progressing towards achieving significant growth in the following years and decisively strengthening its position on the market. As was communicated earlier - ComputerLand incurred a significant loss during the first six months of the year
ComputerLand SA 5 In line with the information communicated in a press release of July 24 th, 2006, the Company incurred, an operating loss of PLN 9.12 million in the first half-year of 2006, and a net loss of PLN 8,9million. The results of the first half-year of 2006 I half-year I half-year 2005 2006 Change Net revenues 248.576 248.567 0,0% Operating profit (loss) 15.721 (9.117) Net profit (loss) 11.150 (8.896) The results of the second quarter of 2006 2Q 2005 2Q 2006 Change Net revenues 129.610 111.051-14,3% Operating profit (loss) 7.381 (13.466) Net profit (loss) 6.487 (8.105) The results of the Company s operations in this period were influenced by: - Switching over to service support from several large implementation projects in the Banking and Telecom sectors. This guarantees stable revenues for the Company, although with a slightly lower revenue volume and profit margins - Moving a number of projects in the Telecom project to future quarters - A stagnation on the Public and Utilities market, both with regard to the number of communicated tenders and the number of awarded contracts - Company restructuring costs - Costs related to the development of new solutions for the Banking and Industry sectors and to investments in Russia - Focusing on the merger with Emax and the implementation of the CoLorado efficiency improvement program Moreover, as a result of an analysis of operations, carried out within the frameworks of the CoLorado project, operations with forecast returns not meeting the current expectations of the Company were identified. Some will be discontinued. The costs related to restructuring such operations, amounting to nearly PLN 7 million, were charged against the results of the first half-year. They mostly concern the development of an ERP product for SMEs. CoLorado and merger with Emax strengthen ComputerLand s market position CoLorado - first results and savings
ComputerLand SA 6 In line with the press release of 11 May 11 2006 on the CoLorado efficiency improvement program, ComputerLand confirms that the program is being consistently implemented. Thanks to this program the Company will increase its gross profit by PLN 50 million over the next 24 months. ComputerLand aims to achieve, thanks to this project, an operating profit of at least 8 percent within 2-3 years. This project is to be implemented until the end of 2007. During the implementation of the CoLorado program, the Company has defined and focused (with regard to sales) on co-operation with the most promising Customers. ComputerLand has limited its Customer list from 700 to nearly 200, along with adapting its sales teams to such changes - the number of persons working in such teams was decreased by over 20%. The Company has implemented, as planned, total control and optimization of expenditures related to the offer preparation process and to presales costs (circa PLN 100 million in 2005). For this reason the company formed Offer Committees in all sectors. Such committees analyze the probability of the success of individual sales processes and make decisions as to which processes should be launched. During the first period of their activity the Offer Committees approved 2/3 of the total number of prospects submitted. Moreover, ComputerLand has initiated a process of evaluating all sales projects currently underway, which is aimed at improving the ratio of tenders won and the share of large and mediumsized projects in total revenues. In the scope of project organization operational since 1 June 1 2006, changes which allowed the adaptation of the operations of the entire company to project-oriented work were made. A new structure was implemented, which has resulted in a decrease in the number of organizational units (from 168 to 67), thus ensuring better cooperation of sales and implementation teams. At the same time a single center to coordinate the participation of all employees in individual projects was formed. Currently, a new motivational system is being implemented. This system will ensure optimal cooperation of the sales and implementation teams. Simultaneously, over the past 3 months the Company has reduced its employment by 200 persons (within the frameworks of the Company s restructuring), ensuring savings to the amount of at least PLN 15 million over the next 12 months. Intensive work with regard to productivity. Works on Group-wide introduction of project planning and software testing standards have been completed. Current works concern
ComputerLand SA 7 implementing standards related to requirement management and project complexity assessment (in line with a formal, global standard) Another area of implemented changes relates to purchasing centralization. Since July 2006 the central purchasing department has handled and monitored all purchase orders placed within the Company. This relates in particular to all services purchased by the Company, both from companies and from individual consultants. Purchasing centralization also includes a reduction in the number of providers and suppliers from the current 1100 to 300 in the first half-year of 2007. This will result in a reduction to the prices of ordered products and services. The estimated savings resulting from this process will amount to PLN 15 million per annum. The pilot project of centralized purchases implemented in two sales sectors has generated savings to the amount of PLN 350 thousand, obtained in the form of additional discounts (10% percent on average) obtained in projects of a total value of PLN 3.5 million. Efficient implementation of the merger process with Emax ComputerLand is implementing the process of merging with Emax in line with the schedule. On 27 July 2006, the company obtained the consent of the Office for Competition and Consumer Protection to carry out the merger consisting of ComputerLand S.A. taking over control of Emax S.A. with its corporate seat in Poznań. OCCP consent was obtained earlier than planned, and this may accelerate the merger. In August both Companies signed an agreement with an external consultant that will support their merger. The purchase of Emax S.A. s stocks by ComputerLand and the merger of these two Companies will strengthen the new entity s strategic and competitive position on the Polish IT market, making it a company able to win and implement large, complex IT projects, and efficiently compete with Polish and global companies. Thanks to the significant compatability of the areas of operations and product offers of the merging companies, the IT service offer for corporate and institutional Customers will be strengthened and developed. The company created as a result of the merger will be, among others things, an undisputable leader in IT service provision for the power industry. Such a company, using its rich experience and industry knowledge, will reinforce its status as a leader in the B&F, Telecom, Industry and Utilities sectors. It will also be one of the leaders in the scope of tailor-made software development, having one of the largest teams of experts on the Polish IT market (circa 3 thousand persons). Due to the merger the ComputerLand Group will also obtain new, attractive Customers.
ComputerLand SA 8 As a result of current work carried out jointly by the Management Boards of ComputerLand and Emax along with the support of an external consultant, the assumptions of a new strategy of the merged entity will be drawn up and the results of the expected synergies will be assessed before the end of September 2006. The new organization structure and the persons employed in key managerial positions in the merged Company will be known by the end of October 2006. Until then both Management Boards will also present a comprehensive plan for the further integration of both companies. 5. Description of factors and events, especially untypical, that had significant influence on the profit achieved. 5.1. B series convertible bonds handling On May 21 st, 2006, B series convertible bonds were redeemed in full. The financial costs related to handling the bonds impacting the Company s results in individual quarters were as follows: Reporting period Interest 8.5% Premium Depreciated financial instrument costs One-time costs resulting from the partial buy-back transaction Total costs 1Q/2006 386 367 453 4,196 5,402 2Q/2006 101 96 119 316 6. Explanations related to the seasonal or cyclical nature of the Company s activities in Q1 2006. The Company s activities do not show seasonal or cyclical nature. 7. Differences between Polish Accounting Principles and the International Financial Reporting Standards. ComputerLand SA has drawn up the statement for Q2 2006 pursuant to Polish Accounting Principles, whereas the consolidated financial statements for Q2 2006 pursuant to International Financial Reporting Standards (IFRS) as a dominant entity. 8. Information on issue, buy-back or repayment of bonds and capital securities. On May 21 st, 2006, the Company bough-back all remaining B series bearer bonds convertible into N series bearer ordinary stocks. On July 27 th, 2006, the Company issued one-year ComputerLand S.A. bonds as part of its five-year Programme for Issue of Short- and Medium-Term Bonds. The Bonds have been offered to investors in accordance with applicable laws and regulations in force in Poland. Issue of the Bonds, in their capacity as an additional source of finance, will enable increased optimisation of the financing costs of ComputerLand S.A. as well as diversification of the Company s sources of finance.
ComputerLand SA 9 The aggregate nominal value of the issued Bonds is PLN 50,000,000; the nominal value of one Bond is PLN 100,000. The Bonds have been issued as interest-bearing bonds, with quarterly interest set at WIBOR 3M plus a margin for investors. The Bonds are denominated in Polish złoty; they have been issued in the non-public offering procedure in keeping with Art. 9.3 of the legislative Act of June 29, 1995 regarding bonds. The Bonds have been issued as non-secured bearer bonds. The Bonds do not assume the form of a document (they are de-materialised bonds), and they shall be entered in the register within the meaning of Art. 5a of the legislative Act of June 29, 1995 regarding bonds. Redemption of the Bonds shall be at their nominal value. ComputerLand S.A. does not envisage introduction of the Bonds to trading in the regulated market. 9. Information on paid or declared dividends. On June 13 th, 2006, the Ordinary General Assembly of Stockholders passed a resolution on paying a dividend of PLN 1.00 per stock. The dividend shall be paid from the Company s 2005 profit. 10. Events after balance sheet day that may have significant impact on future profits or losses of the Company. No events, the results of which would need to be included in the financial statements drawn up on June 30 th, 2006, took place after balance sheet date. 11. Results of changes in the Company s structure, including changes resulting from mergers of economic entities, acquisitions or sale of capital group members, longterm investments, restructuring division and seizure to perform business activities. During Q2 2006 there were no significant changes in the Company s structure, including changes resulting from mergers of economic entities, acquisitions or sale of capital group members, long-term investments, spin-off restructuring and seizure to perform business activities. Changes in the Capital Group were described in paragraph 3 of additional information. 12. Information on changes in the Company s conditional liabilities and assets that arose after December 31 st, 2005. On December 31 st, 2005, the total value of sureties and guarantees provided by the Company to subsidiary entities amounted to PLN 28,781 thousand. On December 31 st, 2005, the total value of sureties and guarantees provided by the Company amounted to PLN 115,969 thousand. On June 30 th, 2006, the total value of sureties and guarantees provided by the Company amounted to PLN 62,653 thousand. On June 30 th, 2006, the total value of sureties and guarantees provided by the Company to subsidiary entities amounted to PLN 21,365 thousand. 13. Information on the ability to realize profit and loss forecasts for the current year that were published earlier. The Management Board of ComputerLand did not publicly announce any forecasts of results for the first half-year of 2006.
ComputerLand SA 10 14. Stockholders directly or indirectly owning at least 5% of the total number of votes on the Company s General Stockholder Assembly. During the period included in this report an increase in the stock capital of ComputerLand S.A. of PLN 46,564 thousand was recorded. On June 30 th, 2006, the Company s stock capital amounted to PLN 6,943,239. On August 10 th, 2006, the Company s stock capital amounts to PLN 6,946,339 and divides into 6,946,339 stocks with a nominal value of PLN 1 each. According to information the Company has access to, the stockholders that on August 10 th, 2006, have a number of stocks exceeding 5% of ComputerLand S.A. s stock capital were as follows: The President of the Management Board of ComputerLand S.A. - Tomasz Sielicki with 8.26% of ComputerLand S.A. s stock capital and the same percentage of votes on ComputerLand S.A. s General Stockholder Assembly, Commercial Union OFE BPH CU WBK SA with 7.20% of ComputerLand S.A. s stock capital and the same percentage of votes on ComputerLand S.A. s General Stockholder Assembly, ING Nationale - Nederlanden Polska OFE with 6.77% of ComputerLand S.A. s stock capital and the same percentage of votes on ComputerLand S.A. s General Stockholder Assembly, Commercial Union Investment Management (Polska) SA with 5.02% of ComputerLand S.A. s stock capital and the same percentage of votes on ComputerLand S.A. s General Stockholder Assembly, Pionier Pekao Investment Management SA with 10.47% of ComputerLand S.A. s stock capital and the same percentage of votes on ComputerLand S.A. s General Stockholder Assembly. Changes in the ownership structure of stakes exceeding 5% of ComputerLand S.A. s in the period since the communication of the previous quarterly report is shown in the table below. STOCKS Structure on 15.05.2006 Number of CL s stocks % of votes on the Company s GSA Changes in the number of stocks Structure on 30.06.2006*/ Number of CL s stocks % of votes on the Company s GSA Changes between 30.06.2005 and 10.08.2006 Structure on 10.08.2006 Number of CL s stocks % of votes on the Company s GSA Tomasz Sielicki 628,841 9.06% (30,000) 598,841 8.62% 598,841 8.62% CU OFE BPH CU WBK 500,000 7.20% 500,000 7.20% 500,000 7.20% ING Nationale- Nederlanden 360,000 5.18% 360,000 5.18% 470,000 6.77% Polska OFE Pioneer Pekao Investment 345,008 >5% 727,029 10.47% 727,029 10.47% Management SA Commercial Union Investment Management (Polska) S.A. 348,931 5.03% 348,931 5.03% 348,931 5.02% */ The list of stockholders has been drawn up according to the Company s best knowledge and on the basis of notifications received under Article 69 paragraph 1 of the Act on public offer and the conditions for introducing financial instruments into organized trading and on public companies (Journal of Laws of 2005, No. 184, item 1539) and on the number of stocks owned by a given stockholder recorded on the previous Company s Extraordinary General Stockholder Assembly.
ComputerLand SA 11 15. Changes in the structure of ownership of stocks and stock options by persons managing and supervising the Company that took place since the communication of the previous quarterly report are as follows: Number of CL s stocks Increases in the stock portfolio Decreases Number of CL s stocks Changes between Number of CL s stocks STOCKS in the stock on purchase of option on 30.06.06 on portfolio, sale 15.05.2006 stocks exercise 30.06.2006 and10.08.06 10.08.2006 of stocks Tomasz Sielicki 628,841 - - (30,000) 598,841-598,841 Michał 74,990 - - 74,990 74,990 - Danielewski Elżbieta - - Bujniewicz- - - - - - Belka Andrzej Miernik - - - - - - - On June 30 th, 2006, the members of the Supervisory Board of ComputerLand S.A. did not own ComputerLand S.A. s stocks. Changes in the ownership of stock options by persons managing and supervising the Company. STOCK OPTIONS On 15.05.2006 Increases in the stock option portfolio acquisition of rights to exercise options Decreases in the stock option portfolio, stock option exercise On 30.06.2006 Changes between 30.06.06 and 10.08.06 On 10.08.2006 Tomasz Sielicki 123,250-123,250-123,250 Michał Danielewski 80,748-80,748-80,748 Elżbieta Bujniewicz- Belka 82,750-82,750-82,750 Andrzej Miernik 35,650-35,650-35,650 STOCK OPTIONS On 15.05.2006 Increases in the stock option portfolio acquisition of rights to exercise options Decreases in the stock option portfolio, stock option exercise On 30.06.2006 Changes between 30.06.06 and 10.08.06 On 10.08.2006 Henryka Bochniarz 3,500-3,500-3,500 Heather Potters 3,850-3,850-3,850 Andrzej Koźmiński 2,100-2,100-2,100 Józef Okolski 3,500-3,500-3,500 16. Proceedings before a court, arbitration body or public administration body. In the presented quarter the Company did not initiate or conduct any proceedings related to liabilities or debts exceeding in total 10% of the Company s stock capital before a court or a public administration body. 17. Information on transactions with related entities.
ComputerLand SA 12 ComputerLand SA did not perform any transactions with members of the ComputerLand SA Capital Group that would exceed the Company s normal scope of operations. 18. Information on credit or loan sureties or guarantees granted. The Company did not grant sureties / guarantees for credits or loans to a single entity or the Company s subsidiary entity in amounts exceeding 10% of the Company s stock capital. As on June 30 th, 2006, around 72% of issued guarantees were due agreement (contract) performance guarantees. The goal of due agreement performance guarantee is to secure claims arising in the case of non-performance or undue performance of an agreement. As on June 30 th, 2006, around 14% of issued guarantees were payment guarantees aimed at guaranteeing the timely payment of cash liabilities. 14% of guarantees and sureties are tender guarantees. As on June 30 th, 2006, the total value of sureties and guaranties granted by the Company amounted to PLN 62,653 thousand. 19. Other information with large significance for the evaluation of the personnel, property and financial condition of the Company, its profit and loss account and changes thereof, as well as information important for the evaluation of the possibility to cover liabilities by the Company. There were no other information with large significance for the evaluation of the personnel, property and financial condition of ComputerLand or information important for the evaluation of the possibility to cover liabilities by ComputerLand during the reporting period. 20. Factors that may influence the profit/loss of the Company during the next quarter. The Group's potential financial results in Q3 2006 may be influenced by the following factors: - Projects in ComputerLand Group s strongest sectors, i.e. B&F and Telecom planned for implementation in the second half-year - Stable income and profits in the Healthcare sector, based on ComputerLand's own software and solutions - The current value of the order portfolio (over PLN 380 million) - The positive effects of the CoLorado efficiency improvement program implemented within the company - The first effects of the merger with EMAX, resulting mostly from limiting mutual competitiveness - The Company's financial costs being lower than in previous half-years Warsaw, August 10 th, 2006