Akciju sabiedriba "VEF"

Quarterly Report • May 29, 2014

JSC VEF, Brīvības gatve 214,Rīga,LV-1039

JOINT STOCK COMPANY VEF (Unified registration number 40003001328)

NON- AUDITED FINACIAL STATEMENTS For the period ended on March 31, 2014

JSC VEF, Brīvības gatve 214,Rīga,LV-1039

CONTENTS

General information

Report on the Management Board's responsibility

Balance sheet

Income statement

Cash flow statement

Statement of changes in equity

Notes to the financial statement

GENERAL INFORMATION
Title of enterprise	Joint stock company VEF
Legal type of enterprise	Public joint stock company
Registred:	On April 15, 1991 in the Register of Enterprises of the Republic of Latvia, re registred on December 7, 2000 with Nbr. 000300132
	On April 14, 2004 registered in the Commercial Register, Nbr. 40003001328
Taxpayers' Reg. Nbr.	LV 40003001328
Legal address	Brīvības gatve 214, Rīga, LV-1039, Republic of Latvia phone: 67270618.
Equity capital 1 :	EUR 2 766 969 registered and paid up capital.
Core businesses:
	*Power supply - distribution of power;
	*Letting and renting of real-estate property
Name of the holder of shares And share capital (% ) 2 :	As on march 31. 2014 ;
	*VEF KOMUNIKĀCIJU SERVISS SIA"	45.52 % ;
	* Laila Līduma	6.31 % ;
	* Tamāra Kampāne	9.50 % ;
	* Gints Feņuks	24.44 % ;
	*Other shareholders	14.23 % .
	Chairman of the Board of the Company:
Chief executive officer:	GINTS FEŅUKS
	TAMĀRA KAMPĀNE
Members of the Board:	MĀRTIŅŠ CAUNA
	MODRIS ZOMMERS
	ANDRIS DENIŅŠ
Members of the Supervisory Council:	INTS KALNIŅŠ
	GUNTIS LIPIŅŠ
	ARNIS ZEKUNDE
	01.01.2014. - 31.03.2014.
Period of account:
Qualified auditor:	Aleksejs Ļitvinovs. Certificate Nbr.190
1

Paid-up and registered equity

capital EUR 2 766 969 2

The company`s capital consists of the 623 528 bearer shares and 1 321 109 registered shares nominal value of shares EUR 1.422872

Report on the Management Board's responsibility to the non-audited financial statement of JSC "VEF" for the three months of 2014

Management Board of JSC "VEF" (hereinafter – the Company) is responsible for preparation of the middle-term financial statements of the Company. The middle-term financial statements are not audited.

Middle-term financial statements are prepared based on justifying documents and represent true and clear overview on the Company's Assets and Equity and Liabilities, its financial standing and results of activity as well as cash flows within the reporting period ended on March 31, 2014.

Accounting principles used in preparation of the middle-term financial statements have not been changed comparing to the previous reporting period. During preparation of the middle-term financial statements decisions taken by the Management Board and estimations made have been cautious and well-founded. The information included in the middle-term management's report is true.

The Management Board of the Company is responsible for ensuring the corresponding accounting system, securing the assets of the Company, as well as for prevention and exposure of fraud and other violation within the Company.

On behalf of the Management Board of JSC "VEF",

Gints Feņuks Chairman of the Management Board

ASSETS
	EUR	EUR
	31.03.2014	31.03.2013
LONG-TERM INVESTMENTS
Intangible assets
Concessions,patents,licences	793	1 214
Total intangible assets	793	1 214
Fixed Assets
Land,buildings and other property	5 596 929	5 653 757
Equipment and machinery
Other fixed assets and inventory	120 775	149 530
Advance payments for fived assets
Total fixed assets	5 717 704	5 803 287
Total long-term investments	5 718 497	5 804 501
Current assets
Inventory
Goods for sale
Total inventory	0	0
Debtors
Customers and client debts	101 021	98 044
Other debtors	7 471	13 043
Future period	0	0
Future period expenses	1 968	2 737
Total debtors	110 460	113 824
Cash	32 395	20 938
Total Current assets	142 855	134 762
TOTAL ASSETS	5 861 352	5 939 263

LIABILITIES
	EUR	EUR
	31.03.2014	31.03.2013
Stockholder's Equity
Common stock	2 766 969	2 766 969
Long-term investments revaluation reserve	801 562	801 562
Total accumulation
Retained earnings from the previous years	-1 092 219	-1 093 685
Retained earnings of the financial years	4 317	16 466
Total stockholder's equity	2 480 629	2 491 312
PROVISIONS
Other provisions	12 585	14 503
Total provisions	12 585	14 503
LIABILITIES
Long-term liabilities
Borrowings from credit institutions	2 993 984	3 060 765
Prepayments from buyers	32 106	32 105
Other liabilities	61 977
Deferred tax liability	122 741	58 969
Total long-term liabilities	3 210 808	3 151 839
Current liabilities
Borrowings from credit institutions	46 781	89 999
Accounts payable	47 555	48 928
Taxes and social security payments	31 636	26 653
Other liabilities	9 560	8 469
Other borrowings	13 963	56 067
Prepayments from buyers	7 835	51 492
Total current liabilities	157 330	281 609
Total liabilities	3 368 138	3 433 448
TOTAL LIABILITIES&STOCKHOLDER'S	5 861 352	5 939 263
EQUITY

PROFIT AND LOSSES ACCOUNT FOR YEAR, WHICH ENDS ON MARCH 31.2014.

		EUR 31.03.2014 -	EUR 31.03.2013 -
1	2	4	4
Net turnover		319 008	299 850
Cost of goods sold	1	-230 640	-203 740
Gross profit		88 368	96 110
Selling expenses
Administrative expenses	2	-30 777	-28 453
Other income from operations	3	491	427
Other expenses from operations	4	-753	-983
Finansial services income	5	0	0
Finansial services expenses	6	-38 305	-39 431
Profit before taxes		19 024	27 671
Other taxes	7	-3 395	-3 394
Deferred tax		-11 312	-7 811
Net profit		4 317	16 466

Earnings per share (EPS) on

31.03.2014- 0.00156 EUR

31.03.2013 -0.00595 EUR

Chairman of the Board

Member of the Board T.Kampāne

G.Feņuks

CASH FLOW STATEMENT FOR YEAR THAT ENDS ON MARCH 31, 2014

		2014	2013
		31.03.	31.03.
		EUR	EUR
	CASH FLOW FROM OERATING
I.	ACTIVITIES
	Profit before outstanding items and taxes (+)	19 024	27 671
	Adjustments:
	fixed assets depreciation ( +)	31 428	27 136
	intangible assets depreciation (+)	105	105
	increase/decrease in provisions	0	0
	profit or losses from exchange rates fluctuation
	(+/-)	0 38 305	279 39 431
	finacial services income Profit or losses before adjustments from current
	assets and liabilities	88 862	94 621
	Adjustments: debtors : increase (-); decrease (+)	3 346	-27 834
	inventory: increase (-); decrease (+)	0	0
	liabilities: increase (-); decrease (+)	-5 397	-15 223
	Gross cash provide by operating activities	86 811	51 563
	Payments for financial	-38 305	-39 430
	Net cash provided by operating activities before	48 506	12 133
	outstanding items: Cash flow from outstanding items (-/+)
	Net cash provided by operating activities :	48 506	12 133
	CASH FLOWS FROM INVESTING ACTIVITIES :
	Fixed assets purchase	0	0
II.	Interest received	0	0
	Net cash used in investing activities :	0	0
	CASH FLOWS FROM FINANCING
	ACTIVITIES:
III.	Expenses for borrowings repayment	-20 000	-30 000
	Expenses on lease liabilities	-4 611
		-24 611	-30 000
	Net cash provided by financing activities :
	Exchange rate fluctuation result :	0	-279
IV.	Net cash flom	23 895	-18 145
	CASH AT BEGINNING OF YEAR	8 500	39 083
	CASH AT END OF YEAR	32 395	20 938

STATEMENT OF CHANGES IN EQUITY FOR YEAR THAT ENDS ON MARCH 31, 2014

	31.03.2014 EUR	31.03.2013 EUR
Stockholder's eguity
Balance at the beginning of the
financial year	2 766 969	2 766 969
Increase from
Decrease from
Balance at the end of the financial year	2 766 969	2 766 969
Long-term investments revaluation reserve
Balance at the beginning of the
financial year	801 562	801 562
Increase from
Decrease from
Balance at the end of the financial year	801 562	801 562
Accumulations
Balance at the beginning of the financial year
Increase from
Decrease from
Balance at the end of the financial year
Retained earnings
Balance at the beginning of the financial year	-1 092 219	-1 093 685
Profit or losses of the finacial year	4 317	16 466
Dividendes
Included in accumulations
Balance at the end of the financial year	-1 087 902	-1 077 219
Stockholder's eguity (total)
Balance at the beginning of the financial year	2 476 312	2 452 800
Balance at the end of the financial year	2 480 629	2 491 312

(1) Net turnover

Turnover consists of revenues that the Company gained in the first three months of 2014 from its core business-service provision without VAT

Type of commercial operations	2014.03.31	2013.03.31
	EUR	EUR
power supply, distribution and servicing	75 441	62 757
Rental income	164 162	145 904
utility services	79 405	91 189
Total	319 008	299 850

Distribution of net turnover by geographical markets

	2014.03.31	2013.03.31
Country	EUR	EUR
Latvia	319 008	299 850
Total	319 008	299 850

(2) Cost of sales

	2014.03.31	2013.03.31
	EUR	EUR
labor and social payments	44 577	40 125
depreciation	31 533	27 241
transport	2 781	2 910
residential services (electricity, water)	121 500	108 845
personnel training	78	64
telecommunication service	240	283
other costs tied to commercial operations	26 957	21 105
insurance (buildings)	1 467	1 299
land rent to LPA	1 507	1 868
Total	230 640	203 740

(3)	Costs of administration	2014.03.31	2013.03.31
		EUR	EUR
	labor and social payments	21 131	20 304
	telecommunication service	240	282
	office supplies	492	424
	cash turnover expenses	58	78
	transport expenses for administrative needs	2 781	2 910
	representative expenses 40%	9	9
	legal assistance or raid	1 620	0
	RFB annual fee	4 446	4 446
	Total	30 777	28 453

Other revenues from commercial

(4) operation

	2014.03.31 EUR	2013.03.31 EUR
fines	171	427
repayment VAT	320
Total	491	427

Other costs of commercial

(5) operations

	2014.03.31	2013.03.31
	EUR	EUR
60% of representative costs	16	17
foreign currency loss	0	279
allowances and bonuses	330	249
fines	407	438
Total	753	983

Payments of interest and similar

(6) expenses

	2014.03.31 EUR	2013.03.31 EUR
credit interests Interest to Swedbank Līzings interest to SEB Līzings	37 698 162 445	39 214 214 3
Total	38 305	39 431
(7) Other taxes	2014.03.31	2013.03.31

	EUR	EUR
real estate tax (buildings ,land)	3 395	3 394
Total	3 395	3 394