Raport finansowy 2013 - Apator · Period included in the financial statement: 01.01.2013 –...

Name of capital group: Apator Group

Period included in the financial statement: 01.01.2013 – 30.09.2013 Reporting currency: Polish zloty (PLN)

Roundings: All amounts are quoted in thousands of Polish zloty (if not stated otherwise)

2013 Quarterly consolidated financial statement of Apator Group for three quarters 2013 with condensed quarterly financial

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1. Description of the organization of the issuer’s capital group with indicated entities subject to

consolidation ............................................................................................................................................................... 3 1.1. Make-up of Apator Group as at 30

th September 2013 ....................................................................................... 3

1.2. The entities subject to consolidation as at 30th

September 2013 ...................................................................... 3 1.3. Business activity of Apator Group .......................................................................................................................... 4 2. Employment in Apator Group ................................................................................................................................... 5 3. Shareholders of parent entity ................................................................................................................................... 6 3.1. Share capital ............................................................................................................................................................. 6 3.2. Possession and changes in the ownership structure of important shareholders............................................ 6 4. Financial part of quarterly statement ....................................................................................................................... 7 4.1. Selected financial data with essential items of condensed financial statement (also translated into Eur)

presenting accumulated data for all quarters of current and previous financial year. ...................................... 7 4.2. Consolidated financial statement of Apator Group............................................................................................. 9 4.2.1. Consolidated financial statement of financial position ..................................................................................... 9 4.2.2. Information concerning the changes in contingent liabilities or contingent assets that have occurred

since the end of the recent financial year (off balance sheet items) of Apator Group ................................... 11 4.2.3. Consolidated financial statement of comprehensive income ....................................................................... 12 4.2.4. Consolidated financial statement of changes in equity ................................................................................. 14 4.2.5. Consolidated cash flow account ....................................................................................................................... 16 4.2.6. Consolidated financial statement according to operating segments ........................................................... 17 4.2.7. Geographical information ................................................................................................................................... 18 4.3. Separated financial statement of Apator SA ...................................................................................................... 19 4.3.1. Financial statement on financial position of parent entity – Apator SA ....................................................... 19 4.3.2. Information on amendments to contingent liabilities or contingent assets that have occurred since the

end of the recent financial year (off-balance sheet items) of parent entity - Apator SA. ............................... 21 4.3.3. Financial statement of comprehensive income of parent entity - Apator SA ............................................. 22 4.3.4. Financial statement of changes in equity of parent entity - Apator SA ....................................................... 24 4.3.5. Cash flow account of parent entity - Apator SA .............................................................................................. 25 5. Information on principles adopted during preparation of financial statement especially the information on

changes being applied in accounting principles .................................................................................................. 26 5.1. Accounting principles ............................................................................................................................................. 26 5.2. Consolidation principles ........................................................................................................................................ 26 6. Additional financial information ............................................................................................................................... 27 6.1. Weighted average number of shares .................................................................................................................. 27 6.1.1. Weighted average number of shares to seperated financial statement ..................................................... 27 6.1.2. Weighted average number of shares for consolidated financial statement ............................................... 27 6.2. EUR exchange rates used for the calculation of selected financial data ....................................................... 27 6.3.1. Consolidated financial statement ...................................................................................................................... 27 6.3.2. Separated financial statement........................................................................................................................... 30 6.4. Amendments to accounting principles ................................................................................................................ 32 7. Factors and events, particularly of special nature, having the impact on financial results achieved by

Apator Group in three quarters 2013. .................................................................................................................... 33 8. Analysis of financial results achieved. ................................................................................................................... 33 8.1. Explanation of seasonal nature of sale ............................................................................................................... 33 8.2. Analysis of revenueson sale ................................................................................................................................. 33 8.3. The analysis of comprehensive income account for three quarters 2013 ..................................................... 34 8.4. Analysis of comprehensive income account in the third quarter 2013 ........................................................... 35 8.5. Analysis of financial position ................................................................................................................................. 36 9. Foreign trade balance, hedging transactions ....................................................................................................... 37 10. The effects of changes in the structure of entity including merger, take over or sale of entities of capital

group of the issuer, long-term investments, division,restructing and discontinued activity ........................... 37






11. Condensed description of significant achievements or failures of the issuer with the list of the most

important events in the period of three quarters 2013 ........................................................................................ 39 12. Events that occurred after 30

th September 2013 i.e. after the day of preparation of quarterly condesend

financial statement. .................................................................................................................................................. 40 13. The forecast of financial results of Apator Group for 2013................................................................................. 40 14. Proceedings before the court, the appropriate body for arbitration or public authority. ................................. 41 15. Information on conclusion by the issuer or subsidiary single or several transactions with related entities in

single or in total which are significant and they were concluded on other than market conditions. ............. 41 16. Information concerning the issue, buyout and repayment of non share related and capital securities. ...... 42 17. Dividend ..................................................................................................................................................................... 42 18. Loans and borrowings ............................................................................................................................................. 42 18.1. Information on guarantee on loan, borrowing or guarantee granted by the issuer or subsidiary............ 42 18.2. Loans and borrowings of subsidiaries of Apator Group ................................................................................ 43 18.3. Information on borrowings granted .................................................................................................................... 43 19. Other significant information for the assessment of personnel, property and financial situation, financial

result and their changes and information for the assessment of possibilities of the issuer to perform its

obligations ................................................................................................................................................................. 44 20. Factors that in opinion of the Executive Board of Apator S.A. will have the impact on future results ( in the

prospective at least one quarter)............................................................................................................................ 44 Preparation of strategy for 2014 – 2019 ..................................................................................................................... 45 Activity continued of Apator SA in economic zone .................................................................................................... 45






1. Description of the organization of the issuer’s capital group with indicated entities subject to consolidation

1.1. Make-up of Apator Group as at 30th

September 2013

The parent entity in Apator Group is Apator SA, that is the owner of 100% share capital of 6 entities: Apator Metrix SA,

Apator Powogaz SA, FAP Pafal SA, Apator Mining Sp. z o.o , Apator Control Sp. z o.o., Apator GmbH and co-owner of 2

entities: Apator Rector Sp. z o.o. (70%) and OOO Apator Elektro (50%).

Moreover: Apator Powogaz SA is the owner of: -100 % of capital of Apator Metra s.r.o. , - 61, 60% of capital of Apator Telemetria sp. z o. o. , - 61% of capital of TOV Apator Metroteks, - 50% of capital of ZAO Teplovodomer, Apator Metrix SA is the owner of 50% of shares of George Wilson Industries Ltd. George Wilson Industries Ltd. is the owner of 35% of capital of INDA d.o.o.

1.2. The entities subject to consolidation as at 30th

September 2013

Parent entity: Apator SA,

subsidiaries (directly and indirectly) consolidated by full method:






Firm Headquarters Share in capital RelRelationships with Apator SA

Apator Mining Sp. z o. o. Katowice 100,00% Subsidiary of Apator SA

Apator Control Sp. z o. o. Toruń 100,00% Subsidiary of Apator S.A.

Apator Metrix SA Tczew 100,00% Subsidiary of Apator S.A.

FAP Pafal SA Świdnica 100,00% Subsidiary of Apator S.A.

Apator Rector Sp. z o. o. Zielona Góra 70,00% Subsidiary of Apator S.A.

Apator Powogaz SA Poznań 100,00% Subsidiary of Apator S.A.

Apator GmbH Berlin (Germany) 100,00% Subsidiary of Apator SA

Newind Sp. z o. o.*) Wrocław 60,00%

42,00%

Subsidiary indirectly of Apator SA through Apator Rector Sp. z o. o. Indirect share through Apator Rector Sp. z o. o.

Apator Metra s. r. o. Sumperk (Czech Republic) 100,00%

100,00%

Subsidiary indirectly of Apator SA through Apator Powogaz SA Indirect share through Apator Powogaz SA

TOV Apator Metroteks Kiev (Ukraine) 61,00%

61,00%


Apator Telemetria Sp.z o.o. Słupsk 61,60%

61,60%


*) On 31st May 2013 all shares in Newind sp. z o.o. were sold.

Joint controlled and associated entities evaluated by equity method:

Firm Headquarters Share in capital RelRelationships with Apator SA SA

OOO Apator Elektro Moscow (Russia) 50,00% Joint controlled by Apator SA

ZAO Teplovodomer Mytishchi (Russia) 50,00%

50,00%

Joint controlled indirectly by Apator S.A. through Apator Powogaz S.A. Indirect share through Apator Powogaz SA

GWi Ltd. Coventry (Great Britain) 50,00%

50,00%

Joint controlled indirectly by Apator S.A. through Apator Metrix S.A. Indirect share through Apator Metrix SA

INDA d.o.o.* Ljubliana (Slovenia) 35,00%

Associated entity of Apator SA through GWI Ltd. Indirect share through GWI Ltd.

*) 35% shares in capital of INDA d.o.o. were purchased on 03.09.2013 by George Wilson Industries Ltd.

1.3. Business activity of Apator Group

APATOR Group concentrates its activity on two segments of electric machines sector: metering and switchgear ones.

The table below presents the scope of activity of particular entities in capital group of Apator:






Metering segment Switchgear segment

Apator Metrix SA z GWi Ltd. and INDA d.o.o. Apator Mining Sp. z o. o.

FAP Pafal SA Apator Control Sp. z o. o.

Apator Powogaz with entities: Apator Metra s. r. o., TOV Apator Metroteks, ZAO Teplovodomer, Apator Telemetria

Sp. z o.o. OOO Apator Elektro

Apator Rector Sp. z o. o.

Apator SA

Apator GmbH

Apator Group offers for metering segment:

Electricity meters,

Gas meters,

Water meters,

Heat meters,

Start-up and service of systems of AMI/AMM class (Automated Meter Management),

Start-up and service of prepayment systems.

The offer capital group of Apator for metering segment covers both hardware and software included in smart metering and smart grids integrated systems. It is comprehensive one and it includes complete chain of values from manufacturing of metering equipment to analysis, visualisation and making available of metering data.

The offer of capital group of Apator for switchgear segment covers the equipment for safe making and breaking of electrical circuits.

2. Employment in Apator Group

The table below shows the employment the employment in Apator Group excluding entities consolidated by equity

method i.e. ZAO Teplovodomer, OOO Apator Elektro oraz GWi Ltd. and INDA d.o.o.

Company Status as at 30.09.2013

Status as at 30.09.2012

Change Dynamics

Apator SA 520 481 39 108,1%

FAP Pafal SA 336 368 - 32 91,3%

Apator Metrix SA 298 308 - 10 96,8%

Apator Mining sp. z o. o. 105 118 - 13 89,0%

Apator Control sp. z o. o. 66 61 5 108,2%

Apator Rector sp. z o.o. 170 146 24 116,4%

Newind sp. z o.o. * - 40 - -

Apator Powogaz Group 565 529 36 106,8%

including: Apator Powogaz SA 364 345 19 105,5%

Apator GmbH 2 2 0 100,0%

Total 2 062 2 053 9 100,4%

*) Newind sp. z o. o. was sold on 31st May 2013

The main changes in employment regarded:






Apator SA – increase of production employees due take over of some services from cooperating parties,

Apator Powogaz Group – caused first of all by increase of employment of production employees in entities of thr

group due to performance of growing number of orders,

Apator Rector sp. z o. o. – increase caused the necessity of the increase of competence and capacity in the areas of

implementation (software engineers) and business suport (system analysts and application developers),

FAP Pafal SA – decrease of employment related to restructuring of the company.

3. Shareholders of parent entity

3.1. Share capital

Share capital of Apator SA as at 30th September 2013 was 3.310.702,80 PLN and it consisted of 33.107.028 shares of

nominal value of 0,10 PLN each.

Shares and votes Number of shares Structure of shares

(%) Number of votes

Structure of votes (%)

Registered shares 7 754 130 23,42% 31 016 520 55,02%

Bearer sharers 25 352 898 76,58% 25 352 898 44,98%

Total shares 33 107 028 100,00% 56 369 418 100,00%

Each bearer share entitles to single vote but registered shares are preferred ones and one such share entitles to four

votes at General Shareholders Meeting.

3.2. Possession and changes in the ownership structure of important shareholders

The shareholders holding at least 5% of total number of votes

3.3. Possession and changes in the ownership structure of shares of persons in management and supervisory

bodies

Person in management:

Apator Mining sp. z o.o. 3 600 000 3 600 000 10,87% 6,39% 3 600 000 3 600 000 10,87% 6,39% - -

Mariusz Lewicki 2 044 000 5 538 007 6,17% 9,82% 2 045 643 5 539 650 6,18% 9,83% 1 643 -

Tadeusz Sosgórnik 1 900 503 4 879 809 5,74% 8,66% 1 900 503 4 879 809 5,74% 8,66% - -

Danuta Guzowska 1 520 279 4 382 921 4,59% 7,78% 1 520 279 4 382 921 4,59% 7,78% - -

Zbigniew Jaworski 1 333 869 3 616 413 4,03% 6,42% 1 333 869 3 616 413 4,03% 6,42% - -

Janusz Marzygliński 1 047 657 3 501 933 3,16% 6,21% 1 047 657 3 501 933 3,16% 6,21% - -

Aviva OFE 2 905 628 2 905 628 8,78% 5,15% 2 905 628 2 905 628 8,78% 5,15% - -

Total 14 351 936 28 424 711 43,34% 50,43% 14 353 579 28 426 354 43,35% 50,44% 1 643 0

votesshares votesshares

(%)

votes

(%)shares

shares

(%)

votes

(%)purchase sale

Description

As at 30th August 2013 As at 14th November 2013 Change

Andrzej Szostak 0 0 0,00% 0,00% 0 0 0,00% 0,00% - -

Tomasz Habryka 0 0 0,00% 0,00% 0 0 0,00% 0,00% - -

Jerzy Kuś 200 200 0,00% 0,00% 200 200 0,00% 0,00% - -

Janina Karaszewska-Zandrowicz 434 500 1 424 500 1,31% 2,53% 434 500 1 424 500 1,31% 2,53% - -

Mirosław Klepacki 0 0 0,00% 0,00% 0 0 0,00% 0,00% - -

Krzysztof Malec 99 396 0,00% 0,00% 99 396 0,00% 0,00% - -

Total 434 799 1 425 096 1,31% 2,53% 434 799 1 425 096 1,31% 2,53% 0 0

votesshares

(%)

votes

(%)purchase saleshares votes

shares

(%)

votes

(%)shares

Description







Persons in supervisory body:

4. Financial part of quarterly statement

Consolidated and separated financial statements for three quarters of 2013 have been prepared in accordance with

International Accounting Standards (IAS / IFRS) and related to them interpretations announced in form of Regulations of

European Commission and Regulation of Ministry of Finance dated 19th

February 2009 on current and regular

information being transferred by the issuers of securities (Journal of Laws of the Republic of Poland No 33, item 259)

with later amendments.

Interim financial statements (consolidated and separated ones of parent entity) for the period of eight months completed

on 30th

September 2013 have been constructed according to IAS 34 (Interim financial reporting). Interim financial

statements do not include all the information and disclosures that are required in annual/semi-annual financial statement

and they should be read together with semi-annual/annual statement of capital group of Apator at 31st December 2012.

4.1. Selected financial data with essential items of condensed financial statement (also translated into Eur)

presenting accumulated data for all quarters of current and previous financial year.

DESCRIPTION

in 000’ PLN in 000’ EUR

Current period

Previous period

Current period

Previous period

Consolidated financial statement III quarters

2013 III quarters

2012 III quarters

2013 III quarters

2012

Sales revenues of products, goods and materials 503 601 498 850 119 249 118 921

Profit (loss) from operating activity 67 801 84 334 16 055 20 104

Gross profit (loss) 65 782 79 318 15 577 18 909

Net profit (loss) 52 146 84 407 12 348 20 122

Net profit (loss) for shareholders of parent entity in

Apator Group 51 544 84 100 12 205 20 049

Net profit (loss) for non-controlling interest 602 307 143 73

Weighted average number of shares 29 507 028 29 507 028 29 507 028 29 507 028

Net profit (loss) per ordinary share [PLN/share] 1,75 2,85 0,41 0,68

Cash flows from operating activity 16 890 44 414 4 006 10 796

Cash flows from investment activity (16 853) (13 629) (3 997) (3 313)

Cash flows from financing activity (24 900) (30 994) (5 906) (7 534)

Total cash flows (24 863) (209) (5 897) (51)

Consolidated financial statement 30.09.2013 2012 30.09.2013 2012

Total assets 511 785 504 448 121 382 123 391

Janusz Niedźwiecki 436 518 1 734 639 1,32% 3,08% 436 518 1 734 639 1,32% 3,08% - -

Mariusz Lewicki 2 044 000 5 538 007 6,17% 9,82% 2 045 643 5 539 650 6,18% 9,83% 1 643 -

Danuta Guzowska 1 520 279 4 382 921 4,59% 7,78% 1 520 279 4 382 921 4,59% 7,78% - -

Janusz Marzygliński 1 047 657 3 501 933 3,16% 6,21% 1 047 657 3 501 933 3,16% 6,21% - -

Marcin Murawski 0 0 0,00% 0,00% 0 0 0,00% 0,00% - -

Krzysztof Kwiatkowski 0 0 0,00% 0,00% 0 0 0,00% 0,00% - -

Total 5 048 454 15 157 500 15,24% 26,89% 5 050 097 15 159 143 15,25% 26,90% 1 643 0

votesshares

(%)

votes

(%)purchase saleshares votes

shares

(%)

votes

(%)shares

Description







DESCRIPTION


Current period

Previous period

Current period

Previous period

Fixed assets 248 952 249 359 59 045 60 995

Current assets 262 833 255 089 62 337 62 396

Equity with non-controlling interest 317 118 299 592 75 212 73 282

Non-controlling interest 1 529 1 160 363 284

Share capital 3 311 3 311 785 810

Long-term liabilities and provisons 32 635 45 364 7 740 11 096

Short-term liabilities and provisions 162 032 159 492 38 430 39 013


Net book value per ordninary share [PLN/share]: 10,75 10,15 2,55 2,48

DESCRIPTION


Current

period

Previous

period

Current

period

Previous

period

Individual financial statement III quarters

2013

III quarters

2012

III quarters

2013

III quarters

2012

Sales revenues of products, goods and materials 125 887 145 736 29 809 34 742

Profit (loss) from operating activity 12 848 28 720 3 042 6 847

Gross profit (loss) 49 089 53 173 11 624 12 676

Net profit (loss) for shareholders of parent entity in

Apator Group 46 519 68 188 11 015 16 255


Net profit (loss) per ordinary share [PLN/share]: 1,41 2,01 0,33 0,48

Cash flows from operating activity 10 357 14 646 2 456 3 560

Cash flows from investment activity 24 281 28 122 5 759 6 836

Cash flows from financing activity (31 682) (36 025) (7 514) (8 757)

Total cash flows 2 956 6 743 701 1 639

Individual financial statement 30.09.2013 2012 30.09.2013 2012

Total assets 280 012 273 799 66 412 66 973

Fixed assets 214 765 221 493 50 937 54 179

Current assets 65 247 52 306 15 475 12 794

Equity with non-controlling interest 212 070 199 082 50 298 48 697

Share capital 3 311 3 311 785 810

Long-term liabilities and provisions 6 640 5 609 1 575 1 372

Short-term liabilities and provisions 61 302 69 108 14 539 16 904


Net book value per ordninary share [PLN/share]: 6,41 5,91 1,52 1,45






4.2. Consolidated financial statement of Apator Group

4.2.1. Consolidated financial statement of financial position

DESCRIPTION Day

30.09.2013 31.12.2012 30.09.2012

Fixed assets 248 952 249 359 239 081

Intangible assets 5 943 4 400 3 739

Goodwill of related entities 63 650 66 248 64 200

Property, plant and equipment 143 036 139 183 134 474

Investment properties 1 735 1 735 1 838

Investments in associated entities consolidated by equity method 4 556 6 571 2 572

Other long-term financial assets 259 525 280

- in related entities - 8 -

- in other entities 259 517 280

Long-term borrowings granted 8 684 8 175 7 336

- to related entities 8 684 8 175 7 336

Long -term receivables 358 1 590 1 572

- from other entities 358 1 590 1 572

Long-term prepayments 50 61 58

Deferred tax assets 20 681 20 871 23 012

Current assets 262 833 255 089 291 609

Inventories 102 376 94 053 90 593

Trade receivables 113 315 102 711 150 223

- from related entities 16 547 2 982 6 226

- from other entities 96 768 99 729 143 997

Current tax assets from legal entities 885 63 32

Receivables due to other taxes (excluding income tax) and other similar

charges 6 077 5 535 5 646

Other short-term receivables 16 769 6 026 13 131

- from related entities - - -


Other short-term financial assets 1 932 1 003 1 067

- in other entities 1 932 1 003 1 067

Short-term borrowings granted - - 759

- to related entities - - 759

Cash and cash equivalents 18 856 43 719 23 881

Short-term prepayments 2 623 1 979 3 601

Fixed assets classified as held for sale - - 2 676

TOTAL ASSETS 511 785 504 448 530 690






DESCRIPTION Day

30.09.2013 31.12.2012 30.09.2012

Equity 317 118 299 592 299 740

Equity for shareholders of parent entity 315 589 298 432 298 697

Share capital 3 311 3 311 3 311

Other capitals 222 837 186 971 186 052

Reserve of remeasurements of defined benefit plans 132 400 -

Hedging transaction evaluation capital and exchange differences from

consolidation (451) 961 617

Undistributed financial result 89 760 106 789 108 717

- undistributed result from previous years 38 216 23 699 24 617

- result of current period 51 544 94 893 84 100

- write-offs from net profit in the financial year (negative value) - (11 803) -

Non-controlling interest 1 529 1 160 1 043

Liabilities 194 667 204 856 230 950

Long-term liabilities and provisions 32 635 45 364 47 173

Long-term loans and borrowings 11 262 12 887 13 230


Long-term liabilities 11 525 25 425 20 215

- towards other entities 11 525 25 425 20 215

Deferred income tax provision 2 365 - 2 602

Long-term provisions for employee benefit liabilities 7 483 7 012 10 907

Other long-term provisions - 40 219

Short-term liabilities and provisions 162 032 159 492 183 777

Short-term loans and borrowings 56 018 42 833 64 510

- from related entities - - -


Trade liabilities 48 272 66 263 70 883

- towards related entities - 1 -


Current tax liabilities from legal entities 4 448 7 606 8 581

Liabilities due to other taxes (excluding income tax) and other similar

charges 7 866 9 246 10 121

Other short-term liabilities 29 931 18 902 9 461

- towards related entities - 1 -


Short-term provisions for employee benefit liabilities 9 409 10 348 6 797

Other short-term provisions 6 088 4 294 13 424

TOTAL LIABILITIES 511 785 504 448 530 690






4.2.2. Information concerning the changes in contingent liabilities or contingent assets that have occurred

since the end of the recent financial year (off balance sheet items) of Apator Group

DESCRIPTION Day

30.09.2013 31.12.2012

Contingent receivables 826 826

Contingent receivables due to other entities 826 826

Contingent liabilities 60 485 13 504

Contingent liabilities due to other entities 60 485 13 504

- due to guarranties and warranties granted 60 485 11 892

- due to import letter of credit - 1 612

Other off-balance-sheet items 182 964 160 138

Fixed assets tenanced 9 158 9 438

Ordinary mortgage 60 540 57 072

Bail mortgage 37 667 37 225

Hedging on property 40 255 33 449

Assignment of receivables 26 812 20 963

Deposits placed 36 36

Blank bills of exchnage 2 949 1 838

Others - compulsory mortgage 5 547 117

Total off-balance-sheet items 244 275 174 468

Moreover, capital group of Apator has established following hedges for the repayments of bank liabilities:

silent assignment of minimum 40% of all the turn over of Apator S.A., assignment of laws under insurance contract of property of Apator S.A. located in Ostaszewo, assignment of laws under insurance policy of property of Apator Mining Sp. z o.o. located in Pszów, assignment of laws under insurance contract of property of Apator Powogaz S.A. located in Poznań, assignment of laws under insurance contract of property of Apator Metra located in Czech Republic, assignment of laws under insurance contract of current assets of Apator Powogaz SA, hedging of inventory up

to the amount of 20 000 000 PLN Further to described hedging for the performance of the bank contracts at the end the third quarter of 2013, the entities of capital group of Apator made the statements on voluntary submission to enforcement to the total amount of 214 m PLN. These statements regard loan contracts and bank guarantee contracts. The statements submitted are equal the amount of maximum liability of the entities increased by bank costs.






4.2.3. Consolidated financial statement of comprehensive income

DESCRIPTION

Period

01.07.2013 01.01.2013 01.07.2012 01.01.2012

30.09.2013 30.09.2013 30.09.2012 30.09.2012

Sales revenues 162 690 503 601 188 804 498 850

Sales revenues of products and services 148 054 461 862 175 429 450 213

- to related entities 15 784 40 239 13 209 30 394

- to other entities 132 270 421 623 162 220 419 819

Sales revenues of goods and materials 14 636 41 739 13 375 48 637

- to related entities 721 2 555 121 216


Cost of goods sold (111 984) (356 338) (141 501) (359 971)

Cost of products and services sold (98 855) (321 395) (130 842) (319 780)

- to related entities (10 220) (25 303) (9 399) (20 316)

- to other entities (88 635) (296 092) (121 443) (299 464)

Cost of goods and materials sold (13 129) (34 943) (10 659) (40 191)

- to related entities (631) (2 281) (113) (200)


Gross profit (loss) on sales 50 706 147 263 47 303 138 879

Selling costs (7 689) (24 003) (7 442) (20 741)

Overheads (17 493) (55 602) (18 103) (54 751)

Profit (loss) on sales 25 524 67 658 21 758 63 387

Other operating revenues (costs), including: 656 (1 321) 20 887 19 617

Result on sales and liquidation of property plant and

equipment and intangibles 145 183 20 958 21 067

Result on revaluation of non financial fixed assets 13 78 - -

Result on valuation of property - 140 - -

Result on revaluation of non financial current assets 529 470 (159) (190)

Result on provisions for retirement bonuses and jubilee

awards 574 164 55 84

Result on other operating activity (605) (2 356) 33 (1 344)

Share in profits of entities consolidated by equity method 1 313 1 464 874 1 330

Profit (loss) on operating activity 27 493 67 801 43 519 84 334

Financial revenues (costs) including: (358) (2 019) (1 155) (5 016)

Interest on loans and borrowings (462) (1 453) (947) (2 248)

Result on other interest 111 644 197 484

Result on shares 60 (1 287) - -

Result on bills of exchange - (1) - -

Result on exchange differences (1 227) (1 561) (1 280) (3 812)

Result on currency transactions 1 506 2 434 1 006 1 155

Result on revaluation of finnacial current assets (172) (281) 66 8

Other financial revenues (costs) (174) (514) (197) (603)

Profit (loss) before tax 27 135 65 782 42 364 79 318

Current income tax (3 829) (11 147) (8 400) (14 512)

Deferred income tax (1 270) (2 489) 520 19 601

Net profit (loss) 22 036 52 146 34 484 84 407






DESCRIPTION

Period

01.07.2013 01.01.2013 01.07.2012 01.01.2012

30.09.2013 30.09.2013 30.09.2012 30.09.2012

Other comprehensive income

Other net comprehensive income 3 004 (1 682) 1 883 5 597

Items that will be reclassified to financial result in the

future:

Exchange differences of foreign entities (631) (255) (353) (701)

Net result on hedging accounting including tax effect 3 635 (1 159) 2 236 6 298

Items that will not be reclassified to financial result in the

future:

Net actuarial gains/(losses) on defined benefit plans including

tax effect - (268) - -

Comprehensive income in total 25 040 50 464 36 367 90 004

Net profit (loss), including: 22 036 52 146 34 484 84 407

shareholders of parent entity 21 739 51 544 34 326 84 100

non-controlling interest 297 602 158 307

Comprehensive income in total, including: 25 040 50 464 36 367 90 004

shareholders of parent entity 24 753 49 864 36 219 89 708

non-controlling interest 287 600 148 296






4.2.4. Consolidated financial statement of changes in equity

DESCRIPTION

CAPITAL FOR THE SHAREHOLDERS OF PARENT ENTITY

Non-controlling interest

TOTAL EQUITY Share

capital Other capitals

Reserve or remeasurements

of defined benefit plans

Capital from valuation of

hedging transactions

and exchange

differences from

consolidation

Retained financial

result TOTAL

Balance as at 01.01.2013 3 311 186 971 400 961 106 789 298 432 1 160 299 592

Changes in equity for the period since 01.01.2013 till 30.09.2013

Profit (loss) due to revaluation (331) (331) - (331)

Hedging instruments for cash flow, including:

- - - (1 430) - (1 430) - (1 430)

- profit (loss) considered in balance valuation for items being hedged

- - - (1 430) - (1 430) - (1 430)

Net exchange differences translated from financial statement to the currency of presentation

- - - (253) - (253) (2) (255)

Tax related to items presented in capital or transfered from capital

- - 63 271 - 334 - 334

Net profit for the period since 01.01.2013 till 30.09.2013

- - - - 51 544 51 544 602 52 146

Comprehensive income for the period since 01.01.2013 till 30.09.2013

- - (268) (1 412) 51 544 49 864 600 50 464

Dividends - - - - (44 510) (44 510) (231) (44 741)

Settlement of advance payment towards dividend from previous year

- - - - 11 803 11 803 - 11 803

Distribution of result for supplementary capital - 35 866 - - (35 866) - - -

Balance as at 30.09.2013 3 311 222 837 132 (451) 89 760 315 589 1 529 317 118

Balance as at 01.01.2012 3 511 165 106 - (4 991) 66 968 230 594 5 873 236 467

Adjustments to the opening balance - - - - 4 331 4 331 (4 732) (401)






DESCRIPTION

CAPITAL FOR THE SHAREHOLDERS OF PARENT ENTITY

Non-controlling interest

TOTAL EQUITY Share

capital Other capitals

Reserve or remeasurements

of defined benefit plans

Capital from valuation of

hedging transactions

and exchange

differences from

consolidation

Retained financial

result TOTAL

Balance after changes made 3 511 165 106 - (4 991) 71 299 234 925 1 141 236 066

Changes in equity for the period since 01.01.2012 till 30.09.2012

Hedging instruments for cash flow, including:

- - - 7 775 - 7 775 - 7 775

- profit (loss) transferred to financial result - - - 7 775 - 7 775 - 7 775

Net exchange differences translated from financial statement to the currency of presentation

- - - (690) - (690) (11) (701)

Tax related to items presented in capital or transfered from capital

- - - (1 477) - (1 477) - (1 477)

Net profit for the period since 01.01.2012 till 30.09.2012

- - - 84 100 84 100 307 84 407

Comprehensive income for the period since 01.01.2012 till 30.09.2012

- - - 5 608 84 100 89 708 296 90 004

Dividends - - - - (24 756) (24 756) (173) (24 929)

Redemption of own shares (200) - - - - (200) - (200)

Redemption of own shares - 1 824 - - (1 624) 200 - 200

Distribution of result for supplementary capital - 24 807 - - (24 807) - - -

Reimbursement of loss from supplementary capital

- (5 685) - - 5 685 - - -

Purchase of additional shares of subsidiary - - - - (1 180) (1 180) (221) (1 401)

Balance as at 30.09.2012 3 311 186 052 - 617 108 717 298 697 1 043 299 740






4.2.5. Consolidated cash flow account

DESCRIPTION

Period

01.01.2013 01.01.2012

30.09.2013 30.09.2012

Cash flow from operating activity

Profit before tax (continued operation) 65 782 79 318

Adjustments: 15 388 (15 210)

Amortization of intangible assets 1 202 1 026

Depreciation of property, plant and equipment 14 360 12 233

Write downs due to depreciation of property,plant and equipment (78) -

(Profit) loss on sales of tangible fixed assets and intangibles (409) (27 624)

(Profit) loss on sales of financial assets available for sales (1 202) -

(Profit) loss from evaluation of investment properties according to fair value. (140) -

(Profits) losses from the change of fair value of derivatives (755) (1 510)

Cost of interest 1 837 3 182

Share in (profits) losses of associated entities (1 464) (1 330)

Interest revenues (58) (42)

Other adjustments 2 095 (1 145)

Cash from operating activity before taking into consideration changes in current assets

81 170 64 108

Change in inventories (8 396) 994

Change in receivables (36 567) (25 185)

Change in liabilities (5 113) 8 849

Change in provisions 1 155 6 315

Change in accruals and prepayments (777) (2 370)

Other adjustments (4) (177)

Cash generated by operating activity 31 468 52 534

Income tax paid (14 578) (8 120)

Net cash from operating activity 16 890 44 414

Cash flow from investment activity

Outflows for the purchase of intangibles (2 468) (685)

Inflows from the sale of intangibles (85) -

Outflows for the purchase of tangible fixed assets (14 620) (22 524)

Inflows from the sales of tangible fixed assets 1 343 21 125

Outflows for the purchase of financial assets available for sales (1) -

Inflows from the sales of financial assets available for sales 4 -

Outflows for the purchase of financial assets held for trading (23) (472)

Inflows from sales of financial assests held for trading 181 380

Investments in subsidiaries - (1 402)

Inflows from sales of subsidiaries (278) -

Inflows from goverment subsidies received - -

Borrowings granted (493) (8 095)

Dividends received 1 776 -

Other inflows (outflows) (2 189) (1 956)






DESCRIPTION

Period

01.01.2013 01.01.2012

30.09.2013 30.09.2012

Net cash from investment activity (16 853) (13 629)

Cash flow from finacial activity

Inflows from loans and borrowings taken 23 997 73 707

Repayment of loans and borrowings (12 583) (75 222)

Interest (1 619) (2 884)

Dividends paid (32 839) (24 849)

Repayment of reliabilities under finance lease contracts (1 671) (1 513)

Other inflows (outflows) (185) (233)

Net cash from financial activity (24 900) (30 994)

Increase(decrease) of net cash and cash equivalents (24 863) (209)

Cash and cash equivalents at the beginning of the period 43 719 24 090

Cash and cash equivalents at the end of the period 18 856 23 881

4.2.6. Consolidated financial statement according to operating segments

The activity Apator Group is concentrated on two key segments of electrical machinery sector:

metering

switchgear

The Group strives to provide with comprehensive service for metering and data read out of utility services and equipment

for safe making and breaking of electrical circuits.

DESCRIPTION Metering

equipment Switchgear

Other

Unalocated

items TOTAL

Financial results of operating segments for the period since 01.01.2013 till 30.09.2013

Total revenues 361 826 110 513 31

262 - 503 601

Sales outside 323 672 105 873 31

262 - 460 807

Sales to related entities 38 154 4 640 - - 42 794

Total costs (266 213) (86 708) (27

420) -

(380 341)

Costs borne outside (242 072) (83 265) (27

420) -

(352 757)

Costs borne to related entities (24 141) (3 443) - - (27 584)

Result of segment 95 613 23 805 3 842 - 123 260

Unalocated costs - - - (56 923) (56 923)

Share in profits of entities consolidated by equity method

- - - 1 464 1 464

Profit (loss) on operating activity 95 613 23 805 3 842 (55 459) 67 801

Financial revenues - - - 3 793 3 793

- Interest - - - 1 066 1 066

Financial costs - - - (5 812) (5 812)

- Interest - - - (1 875) (1 875)

Profit (loss) before tax 95 613 23 805 3 842 (57 478) 65 782

Income tax - - - (13 636) (13 636)

Non-controlling interest - - - (602) (602)

Net profit (loss) 95 613 23 805 3 842 (71 716) 51 544

Other information on segments as at 30.09.2013

Total assets, including: 307 905 76 738 1 300 125 842 511 785






DESCRIPTION Metering

equipment Switchgear

Other

Unalocated

items

TOTAL

Property, plant and equipment 86 872 14 703 - - 101 575

Intangibles 3 679 1 348 - - 5 027

Goodwill of subordinated entities 63 575 75 - - 63 650

Inventories 79 700 22 676 - - 102 376

Trade receivables 74 079 37 936 1 300 - 113 315

Unalocated assets - - - 125 842 125 842

Trade liabilities 30 658 17 470 144 - 48 272

Financial results of operating segmentsfor the period since 01.01.2012 till 30.09.2012

Total revenues 322 031 107 989 68

830 - 498 850

Sales outside 295 185 104 225 68

830 - 468 240

Sales to related entities 26 846 3 764 - - 30 610

Total costs (235 663) (83 329) (61

720) -

(380 712)

Costs borne outside (218 248) (80 228) (61

720) -

(360 196)

Costs borne to related entities (17 415) (3 101) - - (20 516)

Result of segment 86 368 24 660 7 110 - 118 138

Unalocated costs - - - (35 134) (35 134)

Share in profits of entities consolidated by equity method

- - - 1 330 1 330

Profit (loss) on operating activity 86 368 24 660 7 110 (33 804) 84 334

Financial revenues - - - 2 048 2 048

- Interest - - - 823 823

Financial costs - - - (7 064) (7 064)

- Interest - - - (2 587) (2 587)

Profit (loss) before tax 86 368 24 660 7 110 (38 820) 79 318

Income tax - - - 5 089 5 089

Non-controlling interest - - - (307) (307)

Net profit(loss) 86 368 24 660 7 110 (34 038) 84 100

Other information on segments as at 30.09.2012

Total assets, including: 284 688 65 827 49

470 130 705 530 690

Property, plant and equipment 78 328 12 644 1 284 - 92 256

Intangibles 1 581 994 138 - 2 713

Goodwill of subordinated entities 60 837 75 3 288 - 64 200

Inventories 71 449 18 742 402 - 90 593

Trade receivables 72 493 33 372 44

358 - 150 223

Unalocated assets - - - 130 705 130 705

Trade liabilities 29 113 13 383 28

387 - 70 883

4.2.7. Geographical information

The capital group of Apator has separated three areas of its activities: Home – domestic sales European Union – sales to EU countries Export – sales to other countries






DESCRIPTION Home Export EU TOTAL

Sales revenues in geographical segments for the period since 01.01.2013 till 30.09.2013

Total revenues 275 164 93 321 135 116 503 601

Sales outside 275 164 51 040 134 603 460 807

Sales to related entities - 42 281 513 42 794

Sales revenues in geographical segments for the period since 01.01.2012 till 30.09.2012

Total revenues 319 510 72 234 107 106 498 850

Sales outside 319 510 41 624 107 106 468 240

Sales to related entities - 30 610 - 30 610

4.3. Separated financial statement of Apator SA

4.3.1. Financial statement on financial position of parent entity – Apator SA

DESCRIPTION Day

30.09.2013 31.12.2012 30.09.2012

Fixed assets 214 765 221 493 214 776

Intangible assets 3 508 3 057 2 917

Property, plant and equipment 69 840 69 272 62 578

Investment properties 1 300 1 303 1 405

Other long-term financial assets 121 860 126 380 126 142

- in related entities 121 601 125 863 125 862


Long-term borrowings granted - 83 144

- to related entities - 83 144

Long -term receivables 43 943 953

- from other entities 43 943 953

Deferred tax assets 18 214 20 455 20 637

Current assets 65 247 52 306 75 920

Inventories 17 033 18 898 19 984

Trade receivables 31 291 25 675 35 364

- from related entities 6 790 1 946 2 780


Income tax receivables from legal entities 885 - -

Receivables due to other taxes (excluding income tax) and other similar charges

359 1 666 2 409

Other short-term receivables 4 057 415 9 545

- from related entities 2 872 12 8

- from other entities 1 185 403 9 537

Other short-term financial assets 415 131 11


Short-term borrowings granted 2 687 214 209

- to related entities 2 687 214 209

Cash and cash equivalents 7 522 4 566 6 823

Short-term prepayments 998 741 1 575

TOTAL ASSETS 280 012 273 799 290 696






DESCRIPTION Day

30.09.2013 31.12.2012 30.09.2012

Equity 212 070 199 082 209 797

Equity for shareholders of parent entity 212 070 199 082 209 797

Share capital 3 311 3 311 3 311

Other capitals 162 305 138 311 138 311

Reserve of remeasurements of defined benefit plans (169) (49) -

Capital from evaluation of hedging transaction and exchange differences from consolidation

55 359 (13)

Undistributed financial result 46 568 57 150 68 188

- undistributed result from previous years 49 - -

- result of current period 46 519 70 393 68 188

- write-offs from net profit in the financial year (negative value) (13 243)

Liabilities 67 942 74 717 80 899

Long-term and liabilities and provisions 6 640 5 609 5 772

Long-term liabilities 1 617 1 024 1 220


Deferred income tax provision - - -

Long-term provisions for employee benefit liabilities 5 023 4 585 4 552

Short-term liabilities and provisions 61 302 69 108 75 127

Short-term loans and borrowings 38 557 35 358 40 938


Trade liabilities 13 984 13 092 16 487

- towards related entities 1 838 2 893 6 326


Income tax liabilities from legal entities - 4 009 5 336

Liabilities due to other taxes (excluding income tax) and other similar charges

2 070 2 069 2 586

Other short-term liabilities 4 003 11 546 1 894

- towards related entities 95 212 -


Short-term provisions for employee benefit liabilities 2 128 2 459 1 423

Other short-term provisions 560 575 6 463

TOTAL LIABILITIES 280 012 273 799 290 696






4.3.2. Information on amendments to contingent liabilities or contingent assets that have occurred since the end

of the recent financial year (off-balance sheet items) of parent entity - Apator SA.

DESCRIPTION Day

30.09.2013 31.12.2012

Contingent receivables 826 826

Contingent receivables due to other entities 826 826

Contingent liabilities 28 218 4 468

Contingent liabilities due to other entities 28 218 4 468

- due to guarranties and warranties granted 28 218 4 468

Other off-balance-sheet items 53 599 51 448

Fixed assets tenanced 3 937 3 968

Ordinary mortgage 37 000 37 000

Hedging on property 6 626 4 444

Assignment of receivables 6 000 6 000

Deposits placed 36 36

Total off-balance-sheet items 82 643 56 742

Moreover, the Company has established the hedging of repayment of the limit of receivables by silent assignment of minimum 40% of all trade turn over of Apator S.A., and also the assignment of the rights of insurance contract of the properties of Apator S.A. located in Ostaszewo as the hedging of revolving line for bank loan granting. Apator S.A. made the statements on voluntary submission to enforcement for the total amount of 86,25 m PLN at the end of September 2013 under the above described hedging of the performance of bank contract.The statements regard: limit contract of receivables (Raiffeisen Bank Polska S.A.), loan on current account contract (Bank Handlowy w Warszawie S.A.), and revolving line contract for bank guarantee to be granted (Bank Handlowy w Warszawie S.A.). The statements submitted regard the amount of maximum liability of the Company increased by bank costs.






4.3.3. Financial statement of comprehensive income of parent entity - Apator SA

DESCRIPTION

Period

01.07.2013 01.01.2013 01.07.2012 01.01.2012

30.09.2013 30.09.2013 30.09.2012 30.09.2012

Sales revenues 44 984 125 887 49 437 145 736

Sales revenues of products and services 40 867 115 914 44 185 116 942

- to related entities 10 197 21 946 6 709 24 597


Sales revenues of goods and materials 4 117 9 973 5 252 28 794

- to related entities 554 1 929 574 5 185


Cost of goods sold (31 150) (89 592) (37 653) (111 310)

Cost of products and services sold (27 582) (80 935) (33 091) (85 817)

- to related entities (6 700) (15 405) (5 472) (19 395)


Cost of goods and materials sold (3 568) (8 657) (4 562) (25 493)

- to related entities (525) (1 824) (525) (4 568)


Gross profit (loss) on sales 13 834 36 295 11 784 34 426

Selling costs (2 469) (6 582) (2 719) (7 392)

Overheads (6 328) (17 242) (5 957) (18 184)

Profit (loss) on sales 5 037 12 471 3 108 8 850

Other operating revenues (costs), including 343 377 20 007 19 870

Result on sales and liquidation of property plant and equipment and intangibles

46 (1) 20 937 21 145

Result on valuation of property - 140 -

Result on revaluation of non financial current assets 5 (5) (11) (61)

Result on provisions for retirement bonuses and jubilee awards 305 (63) - -

Result on other operating activity (13) 306 (919) (1 214)

Profit (loss) on operating activity 5 380 12 848 23 115 28 720

Financial revenues (costs) 2 636 36 241 (497) 24 453

Dividends and shares in profits 2 630 36 635 - 26 096

- from related entities 2 630 36 635 - 26 096

Interest on loans and borrowings (285) (998) (550) (1 189)

Result on other interest (11) (6) 63 105

Result on shares 95 255 -

Result on exchange differences (470) 19 (333) (1 058)

Result on currency transactions 613 364 356 458

Result on revaluation of finnacial current assets 22 42 100 70

Other financial revenues (costs) 42 (70) (133) (29)

Profit (loss) before tax 8 016 49 089 22 618 53 173

Current income tax (63) (230) (5 189) (5 933)

Deferred income tax (994) (2 340) 790 20 948

Net profit (loss) 6 959 46 519 18 219 68 188






DESCRIPTION

Period

01.07.2013 01.01.2013 01.07.2012 01.01.2012

30.09.2013 30.09.2013 30.09.2012 30.09.2012

Other comprehensive income

Other net comprehensive income 469 (424) 691 1 447

Items that can be reclassified to financial result in the future:

Net result on hedging including tax effect 469 (304) 691 1 447

Items that will not be reclassified to financial result in the future:

Net actuarial gains/(losses) on defined benefit plans including tax effect

- (120) - -

Total income in total 7 428 46 095 18 910 69 635






4.3.4. Financial statement of changes in equity of parent entity - Apator SA

DESCRIPTION Share capital

Other capitals

Reserve of remeasurements of defined benefit plans

Capital on valuation of hedging

transactions and exchange

differences from consolidation

Undistributed financial

result

TOTAL

Balance as at 01.01.2013 3 311 138 311 (49) 359 57 150 199 082

Changes in equity in the period since 01.01.2013 till 30.09.2013

Profit (loss) due to revaluation - - (148) - - (148)

Hedging instruments for cash flow, including - - - (375) - (375)

- Profit (loss) considered in balance valuation for items being hedged - - - (375) - (375)

Tax related to items presented in capital or transfered from capital - - 28 71 - 99

Net profit in the period since 01.01.2013 till 30.09.2013 - - - - 46 519 46 519

Total income since in the period 01.01.2013 till 30.09.2013 - - (120) (304) 46 519 46 095

Dividends - - - - (46 350) (46 350)

Advance payments made towards dividend - - - - 13 243 13 243

Distribution of result for supplementary capital - 23 994 - - (23 994) -

Balance as at 30.09.2013 3 311 162 305 (169) 55 46 568 212 070

Balance as at 01.01.2012 3 511 125 410 - (1 460) 37 731 165 192

Changes in equity in the period since 01.01.2012 till 30.09.2012

Hedging instruments for cash flow, including - - - 1 787 - 1 787

- Profit (loss) considered in balance valuation for items being hedged - - - 1 787 - 1 787

Tax related to items presented in capital or transfered from capital - - - (340) - (340)

Net profit since 01.01.2012 till 30.09.2012 - - - - 68 188 68 188

Total income in the period since 01.01.2012 till 30.09.2012 - - - 1 447 68 188 69 635

Dividends - - - - (24 830) (24 830)

Purchase of own shares - (200) - - - (200)

Redemption of own shares (200) 200 - - - -

Distribution of result for supplementary capital - 12 901 - - (12 901) -

Balance as at 30.09.2012 3 311 138 311 - (13) 68 188 209 797






4.3.5. Cash flow account of parent entity - Apator SA

DESCRIPTION

Period

01.01.2013 01.01.2012

30.09.2013 30.09.2012

Cash flow from operating activity

Profit before tax (continued operation) 49 089 53 173

Adjustments (29 675) (46 748)

Amortization of intangible assets 892 751

Depreciation of property, plant and equipment 5 789 4 461

(Profit) loss on sales of tangible fixed assets and intangibles (215) (27 650)

(Profit) loss on sales of financial assets available for sales (255) -

(Profit) loss from evaluation of investment properties according to fair value. (140) -

(Profits) losses from the change of fair value of derivatives (276) (522)

Cost of interest 1 102 1 903

Interest revenues received (45) (10)

Dividends received (36 635) (26 096)

Other adjustments 108 415

Cash from operating activity before taking into consideration changes in current assets

19 414 6 425

Change in inventories 1 865 2 305

Change in receivables (4 232) (1 092)

Change in liabilities (1 252) 2 605

Change in reserves (57) 5 811

Change in accruals and prepayments (257) (1 183)

Cash generated by operating activity 15 481 14 871

Income tax paid (5 124) (225)

Net cash from operating activity 10 357 14 646

Cash flow from investment activity

Outflows for the purchase of intangibles (1 289) (483)

Outflows for the purchase of tangible assets (8 851) (16 395)

Inflows from the sales of tangible fixed assets 593 20 392

Outflows for the purchase of financial assets available for sales (1) -

Inflows from the sales of financial assets available for sales 4 897 -

Investments in subsidiaries (3 247) -

Borrowings granted (3 000) -

Inflows from repayment of borrowings granted 664 166

Interest received 6 12

Dividends received 36 635 26 096

Other inflows(outflows) (2 126) (1 666)

Net cash from investment activity 24 281 28 122

Cash flow from finacial activity

Inflows from loans and borrowings taken 5 000 26 754

Repayment of loans and borrowings (1 785) (36 000)

Interest (1 076) (1 851)

Dividends paid (33 107) (24 823)

Repayment of reliabilities under finance lease contracts (671) (90)

Other inflows(outflows) (43) (15)

Net cash from financial activity (31 682) (36 025)

Increase(decrease) of net cash and cash equivalents 2 956 6 743

Cash and cash equivalents at the beginning of the period 4 566 80

Cash and cash equivalents at the end of the period 7 522 6 823






5. Information on principles adopted during preparation of financial statement especially the information on

changes being applied in accounting principles

5.1. Accounting principles

The consolidated financial statements of capital group of Apator are compiled according to International Financial

Reporting Standards since the year 2005 according to the requirement imposed by the amendment of the accounting

act. Apator SA also used the possibilities granted by the new Act on accounting and it decided at its general meetings

that:

- separated statements of Apator SA shall be compiled according to IFRS/IAS,

- statements of entities included in capital group of Apator shall be compiled according to IFRS/IAS (both separated and

consolidated statements).

Financial statements (separated and consolidated) at 30th

September 2013 were prepared according to

International Financial Reporting Standards (IFRS/IAS) and interpretations related to them announced in the form of

Regulations of the European Commission, in Polish zloty, due to the fact that Polish zloty is the main currency in which

economic operations are performed in capital group of Apator.

Financial statements of foreign entities included in the capital group of Apator were calculated into the reporting currency

according to rules resulting from International Accounting Standard No. 21.

Financial statements were prepared according to the assumptions on continued activity of the companies of capital group

of Apator in the foreseeable future. As of the day of report preparation there are no circumstances putting the continued

operation of the companies of the capital group of Apator at risk.

Financial statements were prepared according to the historical cost accounting convention that was modified in the case

of fixed assets and financial instruments. Detailed accounting principals used by capital group of Apator were presented

in RS 2012 consolidated statement.

5.2. Consolidation principles

Consolidated financial statement of a capital group includes the data of APATOR SA - parent company and the

companies being under its control. The control takes place when a parent company is directly or indirectly in the

possession of more than 50% of votes in the given business entity or is able to influence on the financial and operational

policy of subordinated subsidiary in order to gain profit from its operations.

Related entities use uniform accounting principles binding in the parent company and they use homogenous form and

scope of individual and consolidated reports that are the bases for consolidation in a capital group.

Consolidated financial report of a capital group is prepared for balance day and for the financial period, specified for

separated financial statement of the parent company.

For the day of purchase, the assets and equity and liabilities of purchased company are estimated according to their fair

market value. The excess of the purchase price above the fair market value of the identifiable taken over net assets of

the company is presented as company value. If the purchase price of the company is lower than the fair market value of

the identifiable taken over net assets of the company, the difference is presented as a profit in the income statement for

the period in which the purchase took place. The share of minority shareholders is presented in an appropriate proportion

of fair market value of assets and capitals.

Financial results of companies purchased or sold during the year are presented in the consolidated statement in

accordance with the date of their purchase or sale.

The method of consolidation was used while preparing the consolidated report by adding individual positions of reports,

exclusions and other corrections. Exclusions include:






- value of shares of subsidiaries held by the parent company quoted in purchase price;

- mutual receivables and liabilities and other similar accounts of consolidated companies;

- profit and costs resulted from economic operations between consolidated companies;

- profit and costs resulted from economic operations between consolidated companies included in the value of

consolidated assets;

- dividends calculated or paid by consolidated companies to other consolidated companies

6. Additional financial information

6.1. Weighted average number of shares

Book value per share was calculated based on division of equities by weighted average number of shares but the profit

per share was calculated based on division of net profit on continued operation by weighted average number of shares.

6.1.1. Weighted average number of shares to seperated financial statement

Weighted average number of shares at 30th September 2013 is 33.107.028 and it is equal the number of shares.

Weighted average number of shares as at 31st December 2012 was 33.669.870. It takes into account the redemption of

2 million of own shares of Apator SA that have been gratuitously acquired from Apator Mining Sp. z o.o.

Weighted average number of shares as at 30th September 2012 is 33.669.870 and it is equal the number of shares.

6.1.2. Weighted average number of shares for consolidated financial statement

Weighted average number of shares as at 30th September 2013, as at 31

st December 2012 and as at 30

th September

2012 is 29.507.028 and it includes shares being in possession of subsidiary.

6.2. EUR exchange rates used for the calculation of selected financial data

Items in assets and liabilities and in cash flow account – according to average exchange rate binding on the day of

preparation of the statement.

Items in income statement- according to average EUR exchange rate being the arithmetical mean of exchange rates are

announced by the National Bank of Poland binding on the last day of the month.

DESCRIPTION

III quarters 2013

2012 III quarters

2012

Eur / PLN Eur / PLN Eur / PLN

Comprehensive income statement 4,2231 X 4,1948

Cash flow statement 4,2163 X 4,1138

Financial position statement 4,2163 4,0882 X

6.3. Information on adjustments to provisions, provision and assets due to deferred income tax mentioned in the

accounting act concerning and the write downs in the value of elements of assets

6.3.1. Consolidated financial statement

Deferred income tax assets and Income tax provision






DESCRIPTION

Status at the beginning of the period

Change due to take over/ exclusion of entity

Net exchange

differences translated

from financial

statement to currency

presented

Charging the result due to the change in temporary differences and tax loss

Increase (decrease) of equity due to the change

of temporary differences

Status at the end of the period

Deferred income tax in the period since 01.01.2013 till 30.09.2013

Deferred income tax assets 29 150 (636) 2 (1 101) 310 27 725

Provision for employee benefits 2 263 - 1 25 63 2 352

Provision for bonuses 836 - - (382) - 454

Provision for margins of revenues - - - 2 - 2

Provision for warranty repairs 773 (8) - 191 - 956

Provision for future costs 647 (468) - 188 - 367

Salaries and wages, insurance fees unpaid

371 1 - 65 - 437

Write downs of property, plant and equipment and intangibles

557 - - (15) - 542

Inventory write downs 932 - 1 (134) - 799

Receivables write downs 417 - - (49) - 368

Valuation at fair value - derivatives 90 - - (80) 247 257

Valuation at fair value-other financial assets

1 - - - - 1

Tax loss 27 - - (27) - -

Tax shelter due to operation in Pomeranian Special Economic Zone

20 006 - - (2 189) - 17 817

Balance amortization apart to tax one 119 - - 30 - 149

Internal transactions 599 - - 568 - 1 167

Differences due to finance lease contracts

150 (134) - (6) - 10

Temporary differences due to long-term contracts (construction contracts)

385 - - (144) - 241

Other costs not taxed in the period, including:

977 (27) - 856 - 1 806






DESCRIPTION

Status at the

beginning of the period

Change due to take

over/ exclusion of

entity

Net exchange

differences translated

from financial

statement to currency presented


Increase (decrease) of equity

due to the change of temporary differences



Provisions due to deferred tax 8 279 (245) 11 1 388 (25) 9 408

Valuation at fair value - property 10 - - 27 - 37

Valuation at fair value - derivatives 363 - - 64 (25) 402

Balance amortization apart to tax one 6 164 - 11 (203) - 5 972

Excess of nominal value over book value of apportionment

238 - - - - 238

Differences due to finance lease contracts

450 (213) - 71 - 308

Liquidated damages received 225 - - (9) - 216

Temporary differences due to long-term contracts (construction contracts)

496 - - 1 707 - 2 203

Other revenues not taxed in the period, including:

333 (32) - (269) - 32

Total X (391) (9) (2 489) 335 X

Deferred income tax assets 20 871 X X X X 20 681

Provisions due to deferred tax - X X X X 2 365

Effective tax rate

DESCRIPTION

Period

01.01.2013 01.01.2012

30.09.2013 30.09.2012

Profit (loss) before tax, including: 65 782 79 318

Income tax calculated according to binding tax rate, including: 12 476 15 070

Adjustments 1 160 (20 159)

Possible tax on tax free revenues (permanent differences), including: (367) (2 083)

- on income related to zone permission - (1 114)

Tax on cost not being costs of revenues (permanent differences) 780 741

Tax on internal transactions in the group (permanent differences) (277) -

Tax on items not included in financial result of the period 233 -

Asset to be taxed due to operation in Pomeranian Special Economic Zone

- (19 243)

Adjustment of tax loss from past years 426 426

Other tax deductions 365 -

Income tax specified in comprehensive income statement 13 636 (5 089)

Effective tax rate 20,73% -6,42%

Write-downs of non-current & current assets






DESCRIPTION Status at the beginning of

the period

Change in the period

(increase "+", decrease "-")

Net exchange diffferences

translated from financial

statement to the currency

presented

Status at the end of

the period

Goodwill of subsidiaries 335 - - 335

Property,plant and equipment 2 930 (78) - 2 852

Other financial assets 211 100 - 311

Invetories 4 668 (574) (5) 4 089

Receivables 5 464 (334) 5 5 135

Total 13 608 (886) - 12 722

6.3.2. Separated financial statement

Deferred income tax assets and Income tax provision


the period


Increase (decrease) of equity due to the change of temporary differences



Deferred income tax assets 22 092 (2 346) 126 19 872

Provision for employee benefits 1 095 12 28 1 135

Provision for bonuses 78 (78) - -

Provision for margins of revenues - - - -

Provision for warranty repairs 109 (3) - 106

Provision for future costs 25 (19) - 6

Salaries and wages, insurance fees unpaid 170 65 - 235

Inventory write downs 110 7 - 117

Receivables write downs 139 (30) - 109

Valuation at fair value - derivatives 33 (105) 98 26

Valuation at fair value-other financial assets 268 - - 268

Tax shelter due to operation in Pomeranian Special Economic Zone

20 006 (2 189) - 17 817

Other costs not taxed in the period, including: 59 (6) - 53







the period


Increase (decrease) of equity due to the change of

temporary differences



Provisions due to deferred tax 1 637 (6) 27 1 658

Valuation at fair value - property 10 27 - 37

Valuation at fair value - derivatives 153 (52) 27 128

Balance amortization apart to tax one 971 36 - 1 007

Excess of nominal value over book value of apportionment

238 - - 238

Liquidated damages received 225 (9) - 216

Other revenues not taxed in the period, including:

40 (8) - 32

Total X (2 340) 99 X

Deferred income tax assets 20 455 (15) 28 18 214

Provisions due to deferred tax - (26) (27) -

Effective tax rate

DESCRIPTION

Period

01.01.2013 01.01.2012

30.09.2013 30.09.2012

Profit (loss) before tax 49 089 53 173

Tax rate 19,00% 19,00%

Income tax calculated according to binding tax rate 9 327 10 103

Possible tax on tax free revenues (permanent differences) (7 116) (6 230)

- including on dividend from related entities (6 961) (4 958)

- on income related to zone permission - (1 114)

Tax on cost not being costs of revenues (permanent differences) 377 355

Asset to be taxed due to operation in Pomeranian Special Economic Zone - (19 243)

Other deductions (18) -

Income tax specified in comprehensive income statement 2 570 (15 015)

Effective tax rate 5,24% -28,24%

Write-downs of non-current & current assets

DESCRIPTION Status at the

beginning of the period

Change in the period (increase "+", decrease "-

")


Other financial assets 1 537 - 1 537

Invetories 579 35 614

Receivables 2 362 (167) 2 195

Total 4 478 (132) 4 346






6.4. Amendments to accounting principles

Amendments to consolidated financial statement:

Capital group of Apator introduced some amendments to financial statement prepared on the day and for the period

ending on 31st December 2012, being the result of amendment made to the standard IAS 19 „Employee benefits”. In

accordance with the standard amended, the cost of the programme of defined benefits covering revaluation of net

liabilities due to defined benefits has been recognized in other comprehensive income.Further to the above amendment

other comprehensive income was charged against the profit in amount of 493 000 PLN corrected by the tax in amount of

93 000 PLN.

The correction of basic error was introduced concerning the recognition of the option of purchase of additional shares in

subsidiaries from non controlling interest for comparative data in the III quarter 2012. The Group assessed again the

provisions of the below contracts concerning the option of the sale of non controlling interest and recognized that non

controlling interest should be recognized as liabilities in accordance with expected acquisition method. Detailed

description of amendments has been presented in annual consolidated financial statement for 2012.

Due to above amendment the following items in finanancial statement on financial position was corrected:

Goodwill of subordinated entities - 485 000 PLN,

Undistributed result from previous years - 1.751 000 PLN,

Result of current period for shareholders of parent entity - 3.374 000 PLN,

Non controlling interest - 5.610 000 PLN

Grupa Apator also has introduced the amendments to the presentation in financial statement of finacial position and in

financial statement on comprehensive income in comparison with financial statement for the period ending on 30th

September 2012.

Amendment concerns presentation of assets and provisions due to deferred income tax (netting) for the amount of 6.025

000’ PLN and presentation (balancing) of other revenues and financial costs for the amount of 313,3 000 PLN.

Amendments introduced do not have the impact on net profit and equities.

Amendments to separated financial statement:

Apator S.A. introduced the amendment to financial statement prepared on the day and for the period ending on 31st

December 2012, being the result of amendment made to the standard IAS 19 „Employee benefits”. In accordance with

the standard amended, the cost of the programme of defined benefits covering revaluation of net liabilities due to defined

benefits Apator SA recognized it in other comprehensive income. Due to the above amendment, the other

comprehensive income have been recognized as the loss in amount of 60 000 PLN corrected by the tax in amount of

11 000 PLN.

Apator S.A. introduces also the amendments to presentation in financial statement on financial position and

comprehensive income statement in comparison with financial statement for the period ending on 30th

September 2012.

The amendment concerns the presentation of asstes and provisions due to deferred income tax (netting) by the amount

of 1.647 000 PLN. Amendment introduced does not have the impact on net profit and equities.






7. Factors and events, particularly of special nature, having the impact on financial results achieved by Apator

Group in three quarters 2013.

The significant impact on financial results achieved in the period of three quarters 2013 has the decrease of the make-up

of the capital group that occurred on 31st May 2013, in result of the sale of shares of Newind sp. z o.o. The impact is:

negative on side of revenues,

positive on side of profitability

During the comparative analysis one should take into account two significant single events that took place in the period

of three quarters 2012:

sales of property by Apator SA,

assets entered in the books for deferred income tax due to tax shelter related to reallocation of the activity of Apator

SA to Pomeranian Special Economic Zone.

8. Analysis of financial results achieved.

8.1. Explanation of seasonal nature of sale

Further to the manufacturing of investment goods by Apator Group during the analysis of revenues it is found a slight

seasonal nature of sale however its impact becomes less and less.

Revenues on sale of capital group of Apator (000’PLN)

YEAR I quarter II quarter III quarter IV quarter

2008 62 950 90 650 102 930 99 661

2009 90 661 85 667 90 011 101 218

2010 77 113 91 590 104 426 136 649

2011 107 127 120 210 144 753 165 912

2012 163 146 146 900 188 804 168 632

2013 167 441 173 470 162 690 -

Share of particular quarters in total sale of Apator Group (%)

YEAR I quarter II quarter III quarter IV quarter

2008 17,67% 25,45% 28,90% 27,98%

2009 24,67% 23,31% 24,49% 27,54%

2010 18,82% 22,35% 25,48% 33,35%

2011 19,91% 22,34% 26,91% 30,84%

2012 24,39% 21,96% 28,23% 25,21%

2013 *) 23,92% 24,78% 23,24% -

*) share calculated according to lower limit of the forecast for sale in 2013 i.e. 700 m PLN

8.2. Analysis of revenueson sale

In the period of three quarters 2013 consolidated revenues on sale were at the level of 503.601 000 PLN and in relations

to three quarters 2012 are:

Significantly higher – increase by 39.593 000 PLN (9%), after the revenues of Newind sp. z o.o. were excluded in

both periods,

Slightly higher – increase by 4.751 000 PLN (0,95%) , with Newind sp. z o.o.revenues included

Newind sp. z o.o. has been operating in Apator Group till 31st May 2013. During three quarters 2012 its revenues were

58.342 000 PLN and in the period January-May 2013 were 23.501 000 PLN – decrease by 34.841 000 PLN/year.

In the sales structure of Apator Group metering segment prevails where its share after three quarters of current year is

71, 85%. Revenues in particular segments were as follows:

metering equipment - 361.826 000 PLN, increase by 39.795 000 PLN (12,36%) y/y, achieved mainly by water,heat

and gas product lines ,






switchgear equipment - 110.513 000 PLN, slightly increase by 2.524 000 PLN (2, 34%) y/y. In switchgear segment

the decrease of revenues on sales of mining equipment due to the economic crisis on the market and the increase

of line product for power engineering and industry. The big contract is being performed for Arcelor Mittal Poland S.A.

other sale - 31.262 000 PLN, decrease by 37.568 000 PLN (54, 58%) y/y caused by smaller revenues on sales of

services and IT equipment by 34.841 000 PLN (Newind excluded – insignificant decrease by 2.727 000 PLN).

The revenues on sales of Apator Group in the period of three quarters 2013 showed high dynamic growth on foreign

markets and the decrease of sale on domestic market.

The Group has performed:

sales on domestic market for the amount of 275.164 000 PLN – decrease by 44.346 000 PLN (13,88%) y/y, after the

exclusion of Newind, decrease by 9.504 000 PLN (3,64%) y/y,

sales on foreign markets for the amount of 228.437 000 PLN, increase by 49.097 000 PLN (27,38%) r/r, including:

to European Union at the level of 135.116 000 PLN, increase by 28.010 000 PLN (26,15%) y/y,

to other countries at the level of 93.321 000 PLN, increase by 21.087 000 PLN (29,19%) y/y.

The share of export in revenues increased from 36,0% in three quarters 2012 to 45,4% in three quarters 2013 . The

progress of sales on foreign markets has been maintaind at the level of average annual growth rate for the recent 5

years equal 27,5%.

The main export areas are showed by the bar chart below:

The main changes regarded the sale:

to Denmark with destination to Dutch market – increase by 18.101 000 PLN achieved in gas product line,

to Russia – increase by 10.440 000 PLN achieved mainly in water and heat product line,

to Ethiopia – increase by 8.355 000 PLN achieved in water and heat product line,

to Hungary – decrease by 6.353 000 PLN due to lower sale in electricity product line

8.3. The analysis of comprehensive income account for three quarters 2013

In the period of three quarters 2013 Apator group achieved the following results:

Description I-III quarters

2013 I-III quarters

2012 Change Dynamics

Revenues on sale 503 601 498 850 4 751 101,0%

50

28

3

50

16

1

24

17

2

16

75

1

11

17

6

8 3

90

7 9

77

5 2

63

4 6

14

4 3

84

4 3

81

39

84

3

32

06

0

20

60

1

12

37

9

9 3

35

35

6 1

66

3 6

17

10

96

7

3 2

89

4 6

99

0

10 000

20 000

30 000

40 000

50 000

60 000

Export of Apator Group according to the countries with the sales performed over 4 m PLN in three quarters 2013

I-III quarters 2013 I-III quarters 2012






Description I-III quarters

2013 I-III quarters


Manufacturing costs of products,merchandise and materials sold 356 338 359 971 -3 633 99,0%

Gross profit on sale 147 263 138 879 8 384 106,0%

Selling costs 24 003 20 741 3 262 115,7%

Overheads 55 602 54 751 851 101,6%

Profit on sale 67 658 63 387 4 271 106,7%

Result on other operating activity -1 321 19 617 -20 938 -6,7%

Share in profit of entities consolidated by equity method 1 464 1 330 134 110,1%

Profit on operating activity 67 801 84 334 -16 533 80,4%

EBITDA 83 363 97 593 -14 230 80,4%

Result on financing activity -2 019 -5 016 2 997 40,3%

Profit/loss before tax 65 782 79 318 -13 536 82,9%

Current income tax 11 147 14 512 -3 365 76,8%

Deferred income tax 2 489 -19 601 22 090 112,7%

Net profit 52 146 84 407 -32 261 61,8%

The following factors had the impact on financial results in reference to three quarters 2012:

sale of shares of Newind on 31.05.2013,

sale of property by Apator SA in the third quarter 2012 for the amount of 36.072 000 PLN that made the increase of

operating profit in 2012 by positive result on the sale in amount of 19,1 m PLN,

booked assets for deferred income tax have been recognized due to the commencement of activity in Pomeranian

Special Economic Zone. The asset as at 30.09.2012 was 19,2 m PLN and it made the increase of net profit in 2012.

After the analysed periods have been made possible to be compared each other by excluding the above mentioned

factors, the results achieved in three quarters 2013 are definetly better on both side of revenues and on side of profits,

with the maitenance of the level of profitability at the same time.

Corrected results I-III Qs 2013 I-III Qs 2012 Change Dynamics

Total sale 480 100 440 508 39 593 109,0%

Profit on sale 68 718 62 391 6 327 110,1%

Operating profit 68 770 64 036 4 734 107,4%

EBITDA 84 151 77 053 7 098 109,2%

Net profit 54 321 48 638 5 683 111,7%

Profitability on sale 14,3% 14,2%

Profitability of EBITDA 17,5% 17,5%

Net profit profitability 11,3% 11,0%

8.4. Analysis of comprehensive income account in the third quarter 2013

Financial statement of comprehensive income in the third quarter 2013 is as follows:

Description III quarter

2013 III quarter


Revenues on sale 162 690 188 804 -26 114 86,2%

Manufacturing costs of products,merchandise and materials sold 111 984 141 501 -29 517 79,1%

Gross profit on sale 50 706 47 303 3 403 107,2%






Description III quarter

2013 III quarter


Selling costs 7 689 7 442 247 103,3%

Overheads 17 493 18 103 -610 96,6%

Profit on sale 25 524 21 758 3 766 117,3%

Result on other operating activity 656 20 887 -20 231 3,1% Share in profit of entities consolidated by equity method 1 313 874 439 150,2%

Profit on operating activity 27 493 43 519 -16 026 63,2%

EBITDA 32 757 48 105 -15 348 68,1%

Result on financing activity -358 -1 155 797 31,0%

Profit/loss before tax 27 135 42 364 -15 229 64,1%

Current income tax 3 829 8 400 -4 571 45,6%

Deferred income tax 1 270 -520 1 790 -244,2%

Net profit 22 036 34 484 -12 448 63,9%

After the third quarter 2013 and the third quarter 2012 have been made possible to be compared each other by excluding

the impact of the sale of property, assets due to tax shelter and activity of Newind, Apator Group achieved in the third

quarter 2013 definetly better financial results. There was the increase of revenues on sale, profit and profitability.

Corrected results III Q 2013 III Q 2012 Change Dynamics

Total sale 162 690 151 992 10 698 107,0%

Profit on sale 25 524 20 781 4 743 122,8%

Operating profit 27 493 23 273 4 220 118,1%

EBITDA 32 757 27 769 4 988 118,0%

Net profit 22 036 18 984 3 052 116,1%

Profitability of sale 20,1% 18,2%

Operating profitability 16,9% 15,3%

Profitability of EBITDA 15,7% 13,7%

Net profit profitability 13,5% 12,5%

8.5. Analysis of financial position

Apator Group for three quarters 2013 has got positive cash flow from operating activity in amount of +16.890 000 PLN

but negative ones from investing activity: -16.853 000 PLN and from financing activity in amount of -24.900 000 PLN.

High value of cash generated in financial year 2012 (+43.719 000 PLN), increased by cash generated from current basic

operating activity (+16.890 000 PLN) are used in investments (-16.853 000 PLN). The investments regard mainly the

acquisition of tangible fixed assets (-14.620 000 PLN) and intangibles (-2.468 000 PLN).

Further, the cash from operating activity enables to finance in financing activity:

payment of dividend in amount of: -32.832 000 PLN,

repayment of loans and borrowings in amount of: -12.583 000 PLN

The above presented cash flow gives in total at the end of the third quarter 2013 the cash in amount of +18.856 000

PLN.

The cash flow of Apator Group presented, proves very good financial position of Apator Group that allows investing and

making repayment of liabilities in time:






Ratios Formula

I-III quarters 2013

I-III quarters 2012

DEBT RATIOS:

Debt rate liabilities/assets 38,0% 43,5%

Net debt loans and borrowings– cash and equivalents borrowings granted

39,7 m PLN 46,5 m PLN

9. Foreign trade balance, hedging transactions

Description

USD quoted in

EUR quoted in

Other currencies

quoted in Total currencies

000’ PLN 000’ PLN 000’ PLN 000’ PLN

Import 45 253 69 467 11 192 125 911

Export 13 474 192 820 22 142 228 437

Foreign trade balance for the three quarters 2013 -31 779 123 354 10 951 102 525

In Apator Group hedging transactions are permanent element of business activity and they are concluded according to

the hedging policy against exchange rate risk.

The Apator Group as at 30th September 2013had hedging transactions in form of forwards for the amount of

33.770 000 EUR with the following deadlines:

2013 : 8.070 000 EUR at weighted average exchange rate 4,24 PLN,

2014 : 16.950 000 EUR at weighted average exchange rate 4,37 PLN,

2015 : 8.750 000 EUR at weighted average exchange rate 4,40 PLN.

Weighted average exchange rate of performance of the above hedging transactions is 4,35 PLN. Transactions have

been concluded with the following banks:

Bank Deadlines

2013 000’ EUR

2014 000’ EUR

2015 000’ EUR

Razem 000’ EUR

Raiffeisen Bank Polska SA 5 290 6 150 4 000 15 440

BZ WBK SA 2 180 8 850 4 500 15 530

Bank Millenium SA 600 1 950 250 2 800

Total 8 070 16 950 8 750 33 770

In the period of three quarters 2013 the valuation of hedging transactions made the increase of the result before tax by

the amount of 2.434 000 PLN and in three quarters 2012 by the amount of 1.155 000 PLN.

10. The effects of changes in the structure of entity including merger, take over or sale of entities of capital

group of the issuer, long-term investments, division,restructing and discontinued activity

Apator Elektro:

On 17th

October 2012 General Shareholders Meeting of ZAO Apator Elektro (joint stock company) made the decision to re-organize the entity by its liquidation and replace it by new entity OOO Apator Elektro. On 26

th November 2012 new

entity - OOO Apator Elektro (limited company) was registered where Apator SA owns 50% shares. OOO Apator Elektro






took the role of trade agent on Russian market replacing up to now entity ZAO Apator Elektro. The commencement of the activity as the limited company is resulted of legal reasons and it is related to the level of tax charges in Russia. (reduced level of tax charges) On 15

th January 2013, ZAO Apator Elektro – joint controlled entity was liquidated.

Apator Rector Sp. z o.o.:

1. On 31st May 2013 Apator Rector Sp. z o.o. sold all its shares of Newind sp. z o.o. for the amount of 1.728 000 PLN

(acquired for 1.043,7 000 PLN). Total selling costs were 3.012 000 PLN (it concerns the write off the value of assets,

goodwill of the firm and liability due to put option). Consolidated loss on sale of shares was 1.284 000 PLN.

2. Apator SA is in possession of 70% shares of Apator Rector sp. z o.o. Since 31st December 2013 roku Apator SA has

the right to purchase the other 30% shares (call option). Purchase price depends on results of the company in the

period 2011-2013 and it is estimated at the level of 18 m PLN.

FAP Pafal SA:

On 21st January 2013 Apator SA sold FAP Pafal SA 181.210 its shares (25,61% of capital) for the amount of 4.893 000

PLN. Purchase costs of the shares by Apator SA was 4.730 000 PLN. The shares were redeemed on 7th

June 2013

(entry into National Court Register).

On 24th

September 2013 FAP Pafal SA acquired 106.182 own shares from Apator SA for their redemption against the remuneration in amount of 2.867 000 PLN. The purchase cost of the shares by Apator SA was 2.771 000 PLN.

The restructuring process of FAP Pafal SA is continued and it is the result of allocation of electronic electricity meters

manufacturing to Apator SA. The activity of FAP Pafal SA will be focused on the manufacturing of inductive electricity

metres and renderring the services concerning the electricity meters.

Apator Powogaz SA:

On 18th April 2013 General Meeting of Apator Powogaz SA adopted the increase of share capital from 753,5 000 PLN to

4.000 000 PLN by emision of 64.930 shares. The shares were entirely taken by Apator SA. The increase of capital took

place on 12th July 2013 (entry to National Court Register).

Apator Metra s.r.o:

On 28.06.2013 the District Court in Ostrava announced the verdict ordering Apator Metra s.r.o. to make payment towards

the former partner of Metra Šumperk - Jaroslav Macháček in amount of 16,6 m CZK (i.e.. 2,8 m PLN according to the

average exchange rate of the National Bank of Poland dated 28.06.2013 of 1 CZK = 0,1669 PLN), as acompensation of

the price of shares purchased from him. The Company made payment the former partner in amount of 6,6 m CZK (i.e.

1,06 m PLN), but as for the remaing part of the amount, it was appealed to the court. The result of settlement of the

appeal will not have the impact on consolidated financial statement of Powogaz Group. The loss resulting of the

establishment of the provison for the interest and additional costs is about 1 m PLN and it was recognized in

consolidated semi annual financial statement.

George Wilson Industries Ltd.:

George Wilson Industries Ltd. - the company joint controlled by Apator Metrix SA on 03.09.2013 acquired 35% shares in

capital of INDA d.o.o. with the headquarters in Ljubliana (Slovenia) for the amount of 50 000 EUR (i.e. 213,6 000 PLN

according to average exchange rate of the Polish National Bank dated 03.09.2013 of 1 EUR = 4,2720 PLN).

INDA d.o.o. deals with the development where the result will be the work out of electronic counter to gas meter with

communication module that will meet the requirements of the British market.






11. Condensed description of significant achievements or failures of the issuer with the list of the most

important events in the period of three quarters 2013

Achievements:

1. Increase of revenues from sales by 9%, profit on sale by 10%, EBITDA by 9% and the maintenance of EBITDA

margin at the level of 17,5% (single events and activity of Newind excluded).

2. Completion of low margin activity in the scope of provision of IT equipment (sale of Newind sp. z o.o.) 3. Significant growth of sales on foreign markets (by 27,4%), particularly it concerns water, heat and gas product line at

remaining high Eur and American dollar exchange rates.

Description Apator Group Apator Group (excluding Newind)

Share in I-III Qs 2013

Share in I-III Qs. 2012 Share in I-III Qs.

2013 Share in I-III Qs. 2012

export 45,40% 35,95% 47,58% 40,71%

Failures:

1. Decrease of sales on domestic market, mainly in electricity, mining equipment and ICT product line.

Description

Apator Group Apator Group (excluding Newind)

Share in I-III Qs. 2013

Share in I-III Qs. 2012 Share in I-III Qs.

2013 Share in I-III Qs. 2012

Domestic sale 54,64% 64,05% 52,42% 59,29%

2. Negative assessment of two year activity of Newind sp. z o.o. in the structure of Apator Group:

Acquisition of shres of Newind Sp. z o.o. has not brought expected results of synergy for ApatorGroup,

Newind Sp. z o.o. has not performed the provisions of investment contract in the scope of the development of

own IT solutions and their integration with the products of Apator Group.

The list of other events that occurred in I-III quarters 2013:

1. On 15th

January, ZAO Apator Elektro joint controlled company was liquidated where Apator SA held 50% of shares. New company OOO Apator Elektro with the 50% share of Apator SA took the role of commercial agent on Russian market replacing former entity ZAO Apator Elektro.

2. On 21st January, 2013 FAP Pafal SA acquired 181.210 own shares from Apator SA for 4.893 000 PLN. The above

shares have been redeemed.

3. On 24th

January 2013, Warsaw Stock Exchange in Warsaw announced about new make-up of index for responsible companies (RESPECT Index). The index consists of 20 companies including Apator SA for the fifth time.

4. On 21st February 2013, the Executive Board of Apator SA declared the dividend from the profit for financial year

2012 in amount of 1,20 PLN per share. On 14th

May 2013 the Executive Board of Apator SA declared the increase of the dividend for financial year 2012 from the amount of 1,20 PLN per share to the amount of 1,40 PLN per share.

5. On 13th

March 2013, the Province Administration Court refused the complaint filed by Apator S.A. against the decision of Tax Chamber Director in Bydgoszcz that defined the liability due to income tax for the amount of 1.256.000 PLN being the result of tax control carried out in 2012 in the scope of the settlement of income tax from legal entities for 2009. Apator SA submitted the cassation appeal to the Supreme Administration Court in Poland.

6. On 20th

March 2013 the Executive Board of Apator SA announced that in the period since 13th

January 2012 till

20th

March 2013 the entities of Apator Group (Apator SA included) concluded with PGE Dystrybucja SA 42 contracts that satisfied in total the conditions the criteria of significant contract. Total net value of the contracts was 22,9 m PLN and they concerned the supply of electricity metres and the inventory power grids.

7. Since 29th March 2013 the shares of Apator SA are quoted for the following time in WIGdiv – dividend index at

Warsaw Stock Exchange.

8. On 18th

April 2013 General Meeting of Apator Powogaz SA made the decision on the increase of share capital of the company to 4 m PLN by the emission of 64.930 shares. The share i9n total have been taken by parent entity – Apator SA and paid from its own means.

9. March Apator Control Sp. z o.o. – subsidiary and ArcelorMittal Poland SA the contract of the supply of the control

equipment and accessories for industrial automatics in “Electrical revamping of Long Rail project”. The contract

should be performed till 28th

February 2014 and the value of the contract is 24,8 m PLN. Apator SA granted the






guarantee of the best performance of the contract by subsidiary Apator Control Sp. z o.o. towards ArcelorMittal

Poland SA. The maximum amount of the guarantee is 24,8 m PLN and it was granted till 22nd

March 2014.

10. On 31st May 2013 Apator Rector Sp. z o.o. concluded the sale contract of all the shares of Newind sp. z o. o., being

60% of share capital. The above shares were sold to two natural persons being co-owners of Newind sp. z o. o.

11. On 24th

June 2013 the Ordinary Shareholders Meeting of Apator SA allocated the amount of 46.350 000 PLN for the dividend from the profit for 2012 that is 1,40 PLN per share.

12. On 24th

June 2013 Mr Ryszard Wojnowski resigned from the function of the member of Supervisory Board of Apator S.A.

13. On 24th

June 2013 Ordinary General Shareholders Meeting of Apator SA recalled Mr Eryk Karski from the member of the Supervisory Board and at the same time it nominated Mr Marcin Murawski and Mr Janusz Niedźwiecki the members of the Supervisory Board.

14. On 25th

June 2013 the Supervisory Board of Apator SA appointed the Executive Board for the tenure of 2013 – 2015. Since that day the Executive Board of Apator SA consists of: Mr Andrzej Szostak – President of the Executive Board and Mr Tomasz Habryka and Jerzy Kuś – the members of the Executive Board of the Company. The tenure of the Executive Board is common and it ends on the day of Ordinary General Shareholders Meeting to be held in 2016.

15. On 26th

June 2013 the Executive Board of Apator SA announced that the insurance contracts would be continued due to actions performed or discontinued actions related to the performance of the function of the member of the Management of Apator Group. Insurance contracts were concluded for the period since 1

st July 2013 till 30

th June

2014 with the following insurance companies:

AIG – in the scope of basic insurance with the insurance amount of 30 m PLN,

ACE – in the scope of excess insurance with the insurance amount of 20 m PLN.

16. On 3rd

September 2013, George Wilson Industries Ltd. joint controlled by Apator Metrix SA acquired 35% shares in share capital of INDA d.o.o. with headquarters in Ljubliana (Slovenia).

17. On 10th

September 2013 the Executive Board announced that Apator SA prolonged till 9th

September 2014 . the term of the obligation of the contract concluded with Bank Handlowy w Warszawie SA. concerning the bank guarantee granted to the amount of 20 m PLN.

18. On 24th

September 2013, FAP Pafal SA acquired 106 000 own shares from Apator SA for the amount of 2.867 000 PLN for their redemption.

12. Events that occurred after 30th

September 2013 i.e. after the day of preparation of quarterly condesend

financial statement.

1. On 8th

November 2013 the Executive Board of Apator SA announced that during the recent 12 months the subsidiary - Apator Powogaz SA concluded with Addis Ababa Water and Sewerage Authority three contracts for the supply water meters of the total value of 6.991 000 USD, i.e. 22.386 000 PLN.

2. On 12th

November 2013 the Executive Board of Apator SA made the decision about the payment of interim dividend towards expected dividend from the profit of 2013 in total value 9.932.108,40 PLN that is in gross value of 0,30 PLN per share. The interim dividend wil be paid on 23

rd December 2013 to the shareholders who will be holding the

shares of Apator SA on 16th December 2013.

13. The forecast of financial results of Apator Group for 2013

The forecast of financial results for 2013 anticipates the achievement of consolidated revenues in the range 700 – 730 m

PLN and consolidated net profit in the range 68 – 71 m PLN assuming that the activity of Apator Group in the make-up

unchanged will be performed in entire 2013 .

In spite of activity of capital group with the make-up decreased (Newind sp. z o.o. was sold on 31st May 2013) The

Executive Board of Apator SA considers that the forecast of consolidated financial results for 2013 will be oscillating at

the lower limit of its range.

Advancement of performance of the forecast

Lower limit of the forecast

Performance I-III quarters 2013


(%)

Consolidated revenues on sale of 700 000 503 601 71,9%






Advancement of performance of the forecast

Lower limit of the forecast



(%)

products,merchandise and materials

Consolidated net profit 68 000 52 146 76,7%

Apator SA does not refer to the forecast of the net profit for the shareholders of parent entity due to the change in

booking principles of the purchase option of minority packages that took place after the publication of the forecast. In

result of correction, options are considred like they are made (excluding non controlling interest).Further to the above the

profit of Apator Group in 99% is for the shareholders of parent entity. Detail conditions of introduction of the correction

have been described in point 6.18 of condensed semi-annual consolidated financial statement.

14. Proceedings before the court, the appropriate body for arbitration or public authority.

Proceedings before the court (including two or more) regarding the commitments or receivables of Apator SA or its

subsidiaries, taken at arbitration court or public authority regarding the issuer and subsidiaries are not 10% of equities of

the issuer.

Furthermore:

The Executive Board of Apator S.A. has completed the appeal process from the decision of the Polish Financial

Supervisory Authority dated 17th

April 2012 where the Company was punished by the amount of 150 000 PLN for

non performance of information obligation,

The Executive Board of Apator SA has been continuing the appeal process from the decision of Tax Chamber in

Bydgoszcz where the tax obligation had been defined in amount of 1.256 000 PLN plus interest resulting of the

control carried out in 2012 in the scope of settlement of income tax from legal entities for 2009. Apator SA on 13th

May 2013 submitted the cassation appeal to the Supreme Administration Court.

On 28.06.2013 the District Court in Ostrava announced the verdict ordering Apator Metra s.r.o. to make payment

towards the former partner of Metra Šumperk - Jaroslav Macháček in amount of 16,6 m CZK (i.e.. 2,8 m PLN

according to the average exchange rate of the National Bank of Poland dated 28.06.2013 of 1 CZK = 0,1669 PLN),

as acompensation of the price of shares purchased from him. The Company made payment the former partner in

amount of 6,6 m CZK (i.e. 1,06 m PLN), but as for the remaing part of the amount, it was appealed to the court. The

result of settlement of the appeal will not have the impact on consolidated financial statement of Powogaz Group.

The loss resulting of the establishment of the provison for the interest and additional costs is about 1 m PLN and it

was recognized in consolidated semi annual financial statement.

15. Information on conclusion by the issuer or subsidiary single or several transactions with related entities in

single or in total which are significant and they were concluded on other than market conditions.

In the period of three quarters 2013 Apator SA or other subsidiary did not concluded transactions with related entities

that would be as single or together significant and were concluded on other conditions than the market ones.

Typical trancactions concluded within Apator Group rconcerning co-operation in the scope of:

electronic electricity meters – co-operation with Apator SA and FAP Pafal SA,

switchgear equipment – co-operation with Apator SA and OOO Apator Elektro,

heat meters – co-operation with Apator S.A. and Apator Powogaz SA,

water maters and heat meters – co-operation with Apator Powogaz SA and ZAO Teplovodomer and Apator

Powogaz S.A. and Apator Telemetria sp. z. o. o.,

export made by entities in Apator Group to German market with participation of Apator GmbH,

plastics processing – co-operation of Apator SA and Apator Metrix SA.






In the scope of financial activity of entities in Apator Group, the dividends are being transfared. In three quarters 2013

Apator SA received from subsidiaries the dividends in total amount of 36.635 000 PLN, i.e. by 40% higher than in the

same period in the previous year.

16. Information concerning the issue, buyout and repayment of non share related and capital securities.

In the period of three quarters 2013 Apator did not make any issuance, buyout or repayment non share related and capital securities.

17. Dividend

On 24th

June 2013 Ordinary General Shareholders Meeting decided to make payment of dividend from the profit for 2012

in total amount of 46.349.839,20 PLN, that is in gross amount 1,40 PLN per share.

Dividend from the profit for 2012

Number of shares Interim dividend

towards dividend per share

Other part of dividend from the

profit for 2012 Dividend

Registered shares 7 754 130 0,40 zł 1,00 zł 10 855 782,00 zł

Bearer shares 25 352 898 0,40 zł 1,00 zł 35 494 057,20 zł

Total shares 33 107 028 0,40 zł 1,00 zł 46 349 839,20 zł

On 12th November 2013 the Executive Board of Apator SA made the decision on payment of interim dividend towards

expected dividend from the profit for 2013 in total amount of 9.932.108,40 PLN, that is in gross amount of 0,30 PLN per

share. The interim payment will be paid on 23rd

December 2013, the shareholders who will be holding the shares of

Apator SA on 16th

December 2013.

Dividend from the profit for 2013

Number of shares Interim dividend per

share Interim dividend

Registered shares 7 754 130 0,30 zł 2.326.239,00 zł

Bearer shares 25 352 898 0,30 zł 7.605.869,40 zł

Total shares 33 107 028 0,30 zł 9.932.108,40 zł

18. Loans and borrowings

18.1. Information on guarantee on loan, borrowing or guarantee granted by the issuer or subsidiary

Apator SA and subsidiaries have not granted any guarantee on loans, borrowing or guarantee to entities from outside the

Group where the value did not exceed 10% of equities of the issuer.

Apator SA granted on 25th

April 2013 to subsidiary - Apator Control Sp. z o.o. guarantee of proper performance by

Apator Control Sp. z o.o. the contract for Arcelor Mittal Poland SA within Apator Group. The value of guarantees

exceeded 10% of equities of Apator SA. Maximum guarantee amount is 24,8 m PLN and it includes entire value of the

contract. Based on the contract concluded Apator Control Sp. z o.o. is obliged to make payment of commission from the

amount of guarantee in value of 1,3% annually for each commenced month of the guarantee. The guarantee was

granetd for the period since 25th

April 2013 till 22nd

March 2014.






18.2. Loans and borrowings of subsidiaries of Apator Group

Description

Loans and borrowings as at 30.09.2013 (000’PLN)

Short-term Long-term TOTAL

Apator SA 38 557 0 38 557

Apator Control sp. z o. o. 2 539 0 2 539

Apator GmbH 157 0 157

Apator Metrix SA 3 511 7 111 10 622

Apator Mining sp. z o. o. 633 0 633

Grupa Apator Powogaz 11 160 4 151 15 311

Apator Rector sp. z o.o. 2 157 0 2 157

Pafal SA 0 0 0

Total 58 714 11 262 69 976 Borrowing granted to Apator GmbH by Apator SA 157 0 157 Borrowing granted to Apator Control sp. z o.o. by Apator SA 2 539 0 2 539

Total Apator Group (data consolidated) 56 018 11 262 67 280

18.3. Information on borrowings granted

On 24th

May 2013 the contract was concluded and based on it Apator S.A. granted the subsidiary - Apator Control Sp. z

o.o. the borrowing in amount of 3.000 000 PLN. The date of the repayment of the last instalment of the borrowing with all

the interest expires on 31st December 2013.

Apator SA has the receivable due to borroing granted to Apator GmbH. The status of the above borrowing as at 30

th

September 2013 was 36 000 Eur i.e. 157 000 PLN. The date of repayment of the borrowing expires on 31st May 2014.

Apator Metrix SA has the receivable due to borrowings granted to its joint controlled entity- GWi Ltd.:

The entity the borrowing was granted to

Title

The amount

according to the

contract

Date of borrowing

granted

Status as at

30.09.2013

Currency

The deadline

Interest rate

GWI Ltd - joint controlled entity

Borrowing granted for current activity

1 450 000,00

05.09.2012 1 450

000,00 GBP 2016

3 p.p above base rate of

Barclays Bank PLC



150 000,00 05.09.2012 150 000,00 GBP 2016


Barclays Bank PLC



75 000,00 03.10.2012 75 000,00 GBP 2016


Barclays Bank PLC



50 000,00 17.07.2013 50 000,00 GBP 2016


Barclays Bank PLC



50 000,00 20.08.2013 50 000,00 GBP 2016


Barclays Bank PLC

TOTAL 1 775 000,00 1 775 000,00 GBP






The statute of the above borrowings was 1.775 000 GBP (i.e. according to the exchange rate of the National Bank of

Poland for the days of their granting – 9.428 000 PLN). As at 30th

September 2013 it was in total 1.775 000 GBP (i.e.

8.684 000 PLN according to the parent bank of purchase exchange rate dated 30th

September 2013 equal 1 GNP =

4,8922 PLN). In total till 30th

September 2013, GWI Ltd. paid to Apator Metrix SA 286,5 000 PLN of interest due to the

borrowings.

19. Other significant information for the assessment of personnel, property and financial situation, financial

result and their changes and information for the assessment of possibilities of the issuer to perform its

obligations

On 25th

June 2013 the make-up of the Executive Board of Apator SA was changed. The Executive Board was

nominated for the following tenure for the period 2013 – 2015 in the following make-up:

Andrzej Szostak – President of the Executive Board,

Tomasz Habryka – Member of the Executive Board,

Jerzy Kuś – Member of the Execuitve Board.

The President of the Executive Board of the previous tenure – Janusz Niedźwiecki was nominated by Ordinary Gebneral

Shareholders Meeting to the Member of the Supervisory Board of Apator SA where he is the chairman.

20. Factors that in opinion of the Executive Board of Apator S.A. will have the impact on future results ( in the

prospective at least one quarter)

In the fourth quarter 2013 Apator Group should achieve the financial results that will allow to perform the annual forcast

at the lower limit of the range. Consolidated revenues from sales should be similar to ones achieved in the third quarter

this year but the profitability will be additionally under the influence of the provisions established obligatory in the costs of

the last quarter.(for example annual bonuses)

Other factors having the impact on future results of Apator Group in the longer time:

External factors

situation on currency market due to high share of export in sales of Apator Group, (particularly it concerns Eur and

American dollar exchange rate),

replacement of current electricity metres by smart metres on domestic market and in Western Europe,

increase of investments in low voltage power grids network and expenses for the automation of operation of power

grids and substations,

increase of expenditure on IT (particularly inventory, MDM),

strong price pressure in tenders on current metering equipment,

necessity of quick adjustement of the product offer to changing and different requirements concerning some different

open standards,

integration of IT systems to manage the network with MDM, centralization of systems in power engineering.

Internal factors

preparation of the strategy for the period 2014-2019 updating the directions of the further development,

activity continued by Apator SA in the area of the Pomeranian Special Economic Zone,

concentration of the manufacturing of electronic electricity meters and plasic processing center in one place in

Apator Group that is in Apator SA,

restructuring process of FAP Pafal SA being the result of the transfer of manufacturing of electronic electricity

metres to Apator SA. Activiity of FAP Pafal SA will be focused on inductive metres and rendering services related to

the metres,

automation of manufacturing processes of electricity metres, gas metres and water meters,

completion the offer by distribution management systems,

active participation in standarization of smart metering and smart grids,






significant role of the research and development related to the adjustment the offer to new standards of smart

metering.

Preparation of strategy for 2014 – 2019

Currently the updating of the strategy of Apator Group is carried out covering:

review of strategy for the period 2011 – 2013 and the assessment of the progress of its performance,

identification of organic development projects and potential acquisition,

determination of the directions of development for the period 2014 – 2019,

preparation of financial model and long-term forecast,

operationalization of the strategy.

Activity continued of Apator SA in economic zone

Apator SA has been continuing the activity in Pomeranian Special Economic Zone at Ostaszewo in the area of Kujavy-

Pomerania Province. The activity in economic zone allows adopting the tax shelter due to the costs of new investment. It

is a tax shelter for legal entities from the income achieved in sale in the zone area. Apator SA has commenced the

settlement of the activity in the zone since 1st June 2012.

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