Dalekovod d.d. — Interim / Quarterly Report 2014

Aug 20, 2014

Dalekovod d.d. Marijana Čavića 4 10 000 Zagreb

Financial statements for period Jan-Jun 2014

Unaudited, nonconsolidated

Zagreb, 31 July 2014

TABLE OF CONTENTS:

• $\mathbf{L}$ MANAGEMENT REPORT
• $\Pi_{\rm eff}$ DECLARATION
• Ш. BALANCE SHEET
• $N_{\rm r}$ STATEMENT OF COMPREHENSIVE INCOME
• $V₁$ CASH FLOW STATEMENT
• VI. STATEMENT OF CHANGES IN EQUITY
• VII. NOTES TO THE FINANCIAL STATEMENTS

L. MANAGEMENT REPORT

On February 26, 2014, Dalekovod d.d. obtained confirmation of the finality of the decision of the Commercial Court in Zagreb dated January 29, 2014 allowing the conclusion of pre- bankruptcy settlement. After the afore-mentioned decision had become final, the conditions required to be met in order to allow increase in core capital were fulfilled and all barriers to smooth operation and winning new projects were removed.

In the first half of 2014, Dalekovod Group ("Group") realized an operating income of HRK 486.2 million, EBITDA of HRK 53.9 million and a net profit of HRK 207.9 million. In the same period, Dalekovod d.d. ("Company") realized an operating income of HRK 339.6 million, EBITDA of HRK 40.3 million and a net profit of HRK 239.5 million, which was a result of the positive effects of mezzanine capital discounting and calculation of the fair value of the financial instruments arising from the same. The lower operating income compared to the same period of 2013 is a consequence of the postponement of public tenders by investors in the country and a decrease in foreign income from the Ukraine resulting from the political instability caused by the crisis.

The long process of concluding pre-bankruptcy settlement carried out before the Commercial Court in Zagreb also had an effect on the opportunities to win new projects in the local and international markets.

Pursuant to the pre-bankruptcy settlement and refinancing of obligations towards financial institutions, suppliers and other creditors, the fair value was calculated on the reporting date and expressed in the financial statements in accordance with the International Accounting Standards. It represents a one-off effect on the profit and loss account, as well as the balance sheet of the Company.

In the first half of 2014, the Company and the Group recorded positive results:

• The Company successfully completed the pre-bankruptcy settlement procedure on February 26, $\bullet$ 2014.
• The restructuring of the Company is progressing in accordance with the plan.
• New members of the Supervisory Board were elected.

The changed strategy of the Company and the Group includes a strong focus on international markets. The Company and its management are aware of the vital importance of continued optimization of fixed costs in order to enable the Company to adapt to the newly created environment of reduced demand in the local market and prepare for penetrating international markets.

Recently, the Company has been putting additional efforts to winning projects in the international market. The company implements projects in Norway, the Ukraine, Latvia, Montenegro, Kosovo, Poland and Slovenia.

The Group and the Company participate in a series of tenders in the country and abroad in order to contract new works and achieve sustainable income growth in the coming years. Since the Company is putting a lot of effort in international activities, it can be reasonably expected that it will win significant projects abroad, of which the shareholders shall be promptly notified.

On behalf of the Company's Management Board:

Goran Brajdić President of the Management Board Dalekovod d.d.

H. DECLARATION

Pursuant to Article 410, paragraph 1, and Article 407, paragraph 2, subparagraph 3 of the Capital Market Act, the persons responsible for preparing the Report: Goran Brajdić, Chairman of the Management Board, Krešimir Anušić, Management Board Member, Marko Jurković, Management Board Member, and Željko Lekšić, Management Board Member, hereby make this

DECLARATION

To the best of our knowledge, the summary set of financial statements of Dalekovod and the Group, prepared in compliance with the appropriate financial reporting standards, provides a full and true view of the assets, liabilities and income of Dalekovod and the Group, with a brief comment on the causes of the information provided. The financial statements have not been audited.

On behalf of the Company's Management Board:

Goran Brajdić President of the Management Board Dalekovod d.d. k m

III. BALANCE SHEET

Assets

Name of position:	AOP	Previous year (net)	Current year (net)	Previous year (net)
	DALEKOVOD jsc			DALEKOV
1	$\overline{2}$	$\overline{\mathbf{3}}$	4	5
ASSETS
A) SUBSCRIBED CAPITAL UNPAID	001	0 i	n
B) NON CURRENT ASSETS (003+010+020+029+033)	002	905 439 504	888 061 926	1.186.895.227
I. INTANGIBLE ASSETS (004 to 009)	003	7.022.262	5.679.500	10.234.288
1. Research & Development expenditure	004	$\mathbf 0$	0
2. Patents, licences, roy alties, trade marks, software&similar rights	005	7 022 262	5 673 388	8 905 615
3 Goodwill 4. Prepay ments for intangible assets	006	0	0 0	1.213.000
5. Intangible assets under construction	007 008	0 O
6. Other intangible assets	009	$\overline{0}$	6.112 0	115.673
II. TANGIBLE ASSETS (011 to 019)	010	516.163.090	502.033.734	1.040.465.59
1 Land	011	164 913 887	164 913 887	285 138 497
2 Property	012	56 634 825	54 913 156	229 792 973
3. Plants and equipment	013	68 877 075	62 177 292	118 870 097
4 Tools, plants&vehicles	014	4 862 839	3.217.128	13 966 627
5. Biological asset	015	Ō	0
6 Prepay ments for tangible assets	016	0	$\mathbf 0$	45 23
7. Assets under construction	017	Ō	Ō	392 643 852
8. Other tangible assets	018	$\Omega$	Ō	8.317
9. Investments property	019	220 874 464	216 812 271
III. NON-CURRENT FINANCIAL ASSETS (021 to 028)	020	367.818.211	365.901.800	120.554.09
1. Share in related parties	021	314 078 254	314 078 254	70 516 314
2 Loans to related parties	022	1.401.507	n
3. Participating interests (stakes)	023	25 516 604	25 520 024	21.766.296
4 Loans to participaling interest	024	$\overline{0}$	0
5. Investments in securities 6 Loans & deposits	025	22 984 198	22 640 967	22.984.198
7. Other non-current financial assets	026 027	3837648 $\overline{0}$	3 662 555 0	5 287 282
8 Investment accounted by equity method	028	$\mathbf{0}$	Ő
IV. TRADE RECEIVABLES (030 to 032)	029	14.435.941	14.446.892	15.641.254
1. Receivables from related parties	030	$\mathbf{0}$	0
2. Receivables from credit sales	031	$\overline{0}$	$\bf{0}$
3 Other receivables	032	14 435 941	14 446 892	15 641 254
V. DEFERRED TAX ASSETS	033	$\bf{0}$
C) CURENT ASSETS (035+043+050+058)	034	392 194 887	522 615 163	546 754 750
I. INVENTORIES (036 to 042)	035	9.443.774	12.544.363	109.993.74
1. Raw materials & consumables	036	8 480 689	11 373 980	58 725 963
2. Work in progress	037	0	0	710 157
3 Products	038	963 085	909 867	41 133 828
4 Merchandise	039	0	260.516	9 097 868
5 Prepay ments for inventories	040	$\overline{0}$	Ō	206 768
6. Other av ailable-for-sale assets	041	$\mathbf 0$	0	119 16
7 Biological asset 11. RECEIVABLES (044 to 049)	042	$\overline{0}$ 325.314.674	Ō
1. Receivables from related parties	043		378.966.251	398.603.19
2 Trade receivables	044 045	63 184 886 173 293 741	78 219 688 183 360 724	3 075 000 265 321 73
3. Receivables from participating parties	046	671 564	890.572	1.222.95
4 Amounts receivable from employees	047	209 971	249 777	1 383 88
5 Receivables from government agencies	048	264 321	3 887 724	5 600 76
6 Other receivables	049	87 690 191	112 357 766	121 998 869
III. CURRENT FINANCIAL ASSETS (051 to 057)	050	51.890.333	119,340,442	8.089.17
1. Share in related parties	051	ō
2. Loans to related parties	052	51 405 306	60 373 122
3 Participating interests (stakes)	053	$\overline{0}$
4. Loans to participating interest	054	311.737	311.737	311.73
5 Investments in securities	055	28 290	40 028 290	28 29
6 Loans & deposits	056	145 000	18 627 293	7 710 32
7. Other financial assets	057	Ō	O	38 82
IV. CASH ON HAND AND IN THE BANK	058	5.546.106	11.764.107	30.068.63
D) PREPAYMENTS AND ACCRUED INCOME	059	4 485 669	1 300 260	2 045 23
E) TOTAL ASSETS (001+002+034+059)	060	1 302 120 060	1 411 977 349	1 735 695 210
F) OFF-BALANCE SHEET ITEMS	061	947 853 743	328 140 604	1 500 611 95

Previous year (net)	Current year (net)
DALEKOVOD GROUP
5	6
$\overline{0}$	0
1 186 895 227	1 178 897 685
10.234.288	8.816.803
0 905 615 8	0 7 499 285
1 213-000	213-000
ō	0
Ō	101 995
115.673	2.522
1.040.465.595 138 497 285	1.034.908.659 285 103 664
229 792 973	169 616 107
118 870 097	109 400 885
13 966 627	12 327 837
0 45 232	O
392 643 852	44 840 11 856 489
8 317	5.838
0	Ō
120.554.090	117.922.914
70 516 314	69 255 987
0 21 766 296	Ō 20 999 403
0	٥
22.984 198	22 640 967
5. 287 282	5. 026 557
0	o
0 15.641.254	O 17.249.309
0	0
0	0
15 641 254	17 249 309
o 546 754 750	0 677 197 162
109.993.744	129.717.616
58. 725 963	68 273 246
710 157	265 426 10 °
133 828 41 9.097 868	38 749 640 12.235 412
206 768	192 415
19 160 1	476 1
Ō	0
398.603.199	435.099.067
3 075 000 265 321 737	2 975 000 285 628 925
222 951 1	890 572
383 ī 881	343 525
5 600 761	412 8 576
$\overline{121}$ 998 869	136 848 470
176 8.089. Ō	81.013.674 Ō
ō	ō
Ō	Ō
737 311	737 311
28 290 324 7 710	40 889 409 39 774.035
38 825	38 494
30.068.631	31.366.804
2 045 233	4 628 447
735 695 210	860 723 293 1
1 500 611 951	786 878 420

Equity and Liabilities

Name of position:	AOP	Previous year (net)	Current year (net)	Previous year (net)	Current year (net)
		DALEKOVOD jsc		DALEKOVOD GROUP
1	$\overline{\mathbf{2}}$	$\overline{\mathbf{3}}$	4	5	6
EQUITY AND LIABILITIES
A) CAPITAL AND RESERVES (063+064+065+071+072+075+078)	062	-36 279 739	438 420 616	40.579.836	480 560 074
I. SHARE CAPITAL	063	286.726.500	187.194.330	286.726.500	187.194.330
II. CAPITAL RESERVES	064	80.478.889	86.750.590	80.478.889	86.750.590
III. RESERVES FROM PROFIT (066+067-068+069+070) 1. Legal reserves	065 066	157, 131, 299 11 486 600	44.367.886 11.486.600	183.334.825	70.279.595
2. Reserves for own shares	067	7773071	7 773 071	11 652 467 7.773.071	11.589.528 7.773.071
3. Own shares and stakes (less)	068	7 773 071	7.773.071	7.773.071	7.773.071
4. Statutory reserves	069	32 881 286	32 881 286	32 923 976	32 923 976
5. Other reserves	070	112 763 413	O	138 758 382	25.766.092
IV. REVALUATION RESERVES	071	40.014.573	40.014.573	40.014.627	40.014.573
V. RETAINED EARNINGS OR LOSS BROUGHT FORWARD (073-074)	072	441.240.682	$-159.390.318$	427.543.269	$-111.412.611$
1. Retained earnings	073	0	0	$\circ$
2. Loss brought forward	074	441-240-682	159 390 318	427 543 269	111-412-611
VI. PROFIT OR LOSS FOR THE FINANCIAL YEAR (076-077)	075	$-159.390.318$	239.483.555	$-122.216.466$	207.954.628
1. Profit for the financial year	076	0	239 483 555	$\mathbf 0$	207 954 628
2. Loss for the financial year	077	159 390 318	$\mathbf 0$	122 216 466
VII. MINORITY INTEREST	078	$\bf{0}$	$\mathbf{0}$	$-215.270$	$-221.032$
B) PROVISIONS (080 to 082)	079	4 211 441	4 711 441	7.039.138	7 755 826
1. Provisions for pensions, severance pay and similar libabilities	080	4 211 441	4 211 441	6.975.473	7 208 054
2. Provisions for tax obligations	081	0	$\Omega$	$\overline{0}$
3. Other provisions	082	$\mathbf{O}$	500.000	63.665	547.771
C) NON-CURRENT LIBILITIES (084 to 092)	083	20.542.464	742.974.082	33.632.884	708 263 168
1. Liabilites to related parties	084	o	46 052 713	$\bf{0}$
2. Liabilities for loans, deposits and other	085	$\overline{0}$	$\Omega$	$\overline{0}$	390.867
3. Liabilities towards banks and other financial institutions	086	$\overline{0}$	418 787 845	10.186.092	428 887 112
4. Amounts pay able for prepayment	087	$\mathbf{0}$	$\Omega$	$\mathbf{0}$
5 Trade pay ables	088	969 117	243 080 983	1.352.686	243 932 648
6 Amounts pay able for securities	089	$\overline{0}$	19.307 618	$\mathbf 0$	19.307.618
7. Liabilities toward participating interests	090	0	3 185 125	$\mathbf 0$	3 185 125
8. Other non-current liabilities	091	9 569 204	2 555 655	12.089.963	2 555 655
9 Deffered tax	092	10.004.143	10 004 143	10.004.143	10.004.143
D) CURRENT LIABILITIES (094 to 105)	093	1 309.565.604	225.438.432	1.650.299 541	663 501 797
1 Liabilites to related parties	094	119 155 367	30 575 330	26 085
2. Liabilities for loans, deposits and other	095	8 009 169	2 616 261	10 636 799	4 523 494
3. Liabilities towards banks and other financial institutions	096	627 217 358	81 331 128	952 511 268	400 119 591
4. Amounts pay able for prepay ment	097	21.371.228	41.931.841	26.535.076	52 933 830
5 Trade pay ables	098	448 080 173	55 654 753	521.769.757	160 777 008
6. Amounts pay able for securities	099	44 197 127	919 417	44.197.127	919.417
7. Liabilities toward participating interests	100	6 370 250	$\Omega$	6.370.250	$\Omega$
8 Liabilities to emloyees	101	9 902 032	3 601 573	18.667.164	15 018 707
9. Taxes, contributions and similar liabilities	102	19 502 861	3 378 953	33 377 965	18 232 372
10 Liabilities arising from share in the result	103	1899762	1 899 762	1899762	1.899.762
11 Liabilities arising from non-current assets held for sale	104	$\mathbf 0$	$\Omega$	0
12. Other current liabilities	105	3 860 277	3 529 414	34 308 288	9 077 617
E) ACCRUED EXPENSES AND DEFERRED INCOME	106	4 080 290	432 778	4 143 811	642 429
F) TOTAL LIABILITIES (062+079+083+093+106)	107	1 302 120 060	1 411 977 349		1 735 695 210 1 860 723 293
G) OFF-BALANCE SHEET ITEMS	108	947 853 743	328 140 604	1 500 611 951	786 878 420
ANNEX TO THE BALANCE SHEET (to be filled in by a company preparing the consolidated annual financial statements) A) CAPITAL AND RESERVES
1. Attributable to equity holders of the parent company's capital	109			40 795 106	480 781 104
2. Attributable to non-controlling interests	110			$-215270$	221 032

IV. STATEMENT OF COMPREHENSIVE INCOME

Name of position	AOP	2Q 2013	2Q 2014	2Q 2013	2Q 2014
1	$\overline{2}$	3 $\blacktriangleleft$		5 $\overline{\mathbf{6}}$
			DALEKOVOD J.S.C. 339.661.569	DALEKOVOD GROUP
I. OPERATING INCOME (112+113) 1. Sales revenue	111 112	385.581.769 380 262 618	333 769 416	563.934.467 558 104 645	486.246.189 470 284 587
2 Other operating income	113	5.319.151	5 892 153	5 829 822	15 961 602
II. OPERATING EXPENSES (115+116+120+124+125+126+129+130)	114	380.690.088	315,773,653	549.733.953	455, 113, 966
1. Changes in inventories of finished products and work in progress	115	184.684	53 046	2 605 603	-9 208 055
2. Material costs (117 to 119)	116	245.864.913	190 514 212	346 044 447	265 146 172
a) Cost of raw materials & consumables	117	75 614 323	47.247.310	107 965 593	77 297 337
b) Cost of goods sold	118	31.179.713	12 879 535	56 398 846	48 429 384
c) Other costs	119	139 070 877 68.088.140	130 387 367	181 680 008	139 419 450 102 413 380
3 Staff costs (121 to 123) a) Net salaries	120 121	45 839 524	57 138 656 39 170 830	115 490 810 74 952 112	65 359 583
b) Employee income tax	122	11.572.224	11 558 625	24 284 534	24 360 692
c) Tax on pay roll	123	10 676 392	6 409 201	16 254 164	12 693 105
4. Depreciation and amortisation	124	17.255.517	16 447 989	23 175 651	22 824 938
5. Other expenditures	125	45 020 861	45.448.062	57.624.914	63 987 882
6 Value adjustment (127+128)	126	1 205 371	0	1 205 371	58.532
a) non-current assets (without financial assets)	127	$\Omega$	Ō	0	O
b) current asssets (without financial assets)	128	1 205 371	$\overline{0}$	1 205 371	58.532
7. Provisions	129	ō	500.000	$\Omega$	500.000
8 Other operating expenses III. FINANCIAL INCOME (132 to 136)	130 131	3 070 602 7.695.937	5 671 688 228.482.315	3 587 157 8.486.966	9 391 117 204.211.699
1 Interest income foreign exhange differences, dividends and other financial
income related to subsidiaries 2. Interest income, foreign exchange differences, dividends and other financial	132	1 394 968	29 283 364	1 367 984	326 764
income related to third parties	133	6 004 283	20 539 859	6737953	25 218 168
3 Part of income from associates and participating interests	134	296 686	0 $\Omega$	380 847	7.471
4 Unrealized gains (income) from the financial assets 5 Other financial income	135 136	$\mathbf 0$ $\mathbf{0}$	178 659 092	$\overline{0}$ 183	178 659 296
IV. FINANCIAL COSTS (138 to 141)	137	7.408.163	12.599.312	9.129.394	23.462.067
1. Interest, foreign exchange dfifferences and other expenses related to
subsidiaries	138	623 109	393 026	623 229	$\circ$
2. Interest, foreign exchange differences and other expenses related to third parties	139	6 230 930	9 418 622	7 339 905	20 592 334
3 Unrealized loss (expenses) from the financial assets	140	$\Omega$	$\Omega$	$\Omega$	7 471
4. Other financial expenses	141	554 124	2 787 664	1 166 260	2 862 261
IV. SHARE OF INCOME OF ASSOCIATES IVI.	142	$\overline{\mathbf{0}}$ $\bf{0}$	$\bf{0}$ $\overline{\mathbf{0}}$	7.140.850 $\bf{0}$	52.730
SHARE OF LOSS OF ASSOCIATES VII. EXTRAORDINARY - OTHER INCOME	143 144	$\mathbf{0}$	$\overline{0}$	$\bf{0}$	2444.877
VIII. EXTRAORDINARY - OTHER EXPENSES	145	$\mathbf{0}$	$\bf{0}$	$\bf{o}$
IX. TOTAL INCOME (111+131+142+144)	146	393.277.706	568.143.884	579.562.283	690.510.618
X. TOTAL EXPENSES (114+137+143 + 145)	147	388.098.251	328.372.965	558.863.347	481.020.909
XI. PROFIT OR LOSS BEFORE TAX (146-147)	148	5.179.455	239.770.919	20.698.936	209.489.709
1 Profit before tax (146-147)	149	5 179 455	239 770 919	20 698 936	209 489 709
2 Loss before tax (147-146)	150	Ō
XII. INCOME TAX EXPENSE	151	998	287.364	1.922.847	1.539.342
XIII. PROFIT OR LOSS FOR THE PERIOD (148-151) 1 Profit for the period (149-151)	152	5.178.457 5 178 457	239.483.555 239 483 555	18.776.089 18 776 089	207.950.367 207 950 367
2. Loss for the period (151-148)	153 154		U
ANNEX TO THE PROFIT AND LOSS ACCOUNT (to be filled in by entities submitting consolidated financial statements)		U
XIV PROFIT OR LOSS FOR THE PERIOD
1 Attributable to owners of the company	155	0	$\circ$	19 010 206	207 954 628
2. Attributable to non-controlling interests	156	$\overline{O}$	$\overline{0}$	$-234.116$	4 2 6 2
STATEMENTS OF COMPREHENSIVE INCOME (to be filled by entities who work in compliance with IFRS)
PROFIT OR LOSS FOR THE PERIOD (= 152)	157	5 178 457	239 483 555	18 776 089	207 950 367
II. OTHER COMPREHENSIVE INCOME /LOSS BEFORE TAX (159 to 165) 1. Exchange differences ansing from foreign operations	158	0	$\circ$	$\circ$	$\circ$
2. Revialuation of non-current, assets and intangible assets	159 160	0 Ō	O $\overline{0}$	$\circ$ 0	$\overline{0}$ 0
3 Gains or loss available for sale investments	161	O	0	0	0
4 Gains or loss on net moviement on cash flow hedges.	162	$\overline{0}$	$\overline{0}$	0	$\overline{0}$
5 Gains or loss on net inviestments hedge	163	0	0	0	$\overline{0}$
6. Share of the other comprehensive income/loss of associates	164	$\overline{0}$	$\overline{0}$	$\overline{0}$	$\overline{0}$
7 Acturial gain / loss on post employment benef it obligations	165	0	$\circ$	0	$\circ$
III TAX ON OTHER COMPREHENSIVE INCOME OF THE PERIOD	166	$\mathbf 0$	0	$\circ$	0
IV NET OTHER COMPREHENSIVE INCOME OR LOSS FOR THE YEAR (158-166)	167	$\Omega$	$\overline{0}$	$\overline{0}$	0
V TOTAL COMPREHENSIVE INCOME/LOSS FOR THE PERIOD (157+167)	168	5 178 457	239 483 555	18 776 089	207 950 367
APPENDIX Statement of Comprehensive Income (to be filled in by entities submitting consolidated financial statements) VI. TOTAL COMPREHENSIVE INCOME/LOSS FOR THE PERIOD
1. Attributable to owners of the company	169	ō	ō	19.010.206	207.954.628
2. Attributable to non-controlling interests	170	$\overline{\mathfrak{o}}$	Ō	$-234.116$	$-4.262$

V. CASH FLOW STATEMENT

c	AOP	Previous period	Current period	Previous period	Current period
$\mathbf{I}$	$\overline{2}$	$\overline{3}$	$\overline{4}$	5	я
		DALEKOVOD jsc		DALEKOVOD GROUP
CASH FLOW FROM OPERATING ACTIVITIES
1 Pre-tax profit	001	5.179.455	239 770 919	20 698 936	209 489 709
2. Depreciation	002	17.255.517	16 447 989	23 175 651	22 824 938
3. Increase in short-term liabilities	003	54.152.603	ō	2.091.917
4. Decrease in short-term receivables	004	$\Omega$	$\overline{O}$	$\mathbf{0}$	$\Omega$
5. Reduction of stocks	005	841.661	$\Omega$	6.996.285
6. Other increase in cash flow	006	$\mathbf 0$	407 692 544	306.300	727 858 472
I. Total increase in cash flow from operating activities (001 to 006)	007	77.429.236	663.911.452	53.269.089	960.173.119
1. Decrease in short-term liabilities	008		93 934 031	0	373 473 680
2. Increase in short-term receivables	009	36.991.485	53.651.577	12.853.624	36 495 869
3. Increase in stocks	010	$\Omega$	3 100 589	$\Omega$	19 723 872
4. Other decrease in cash flow	011	1.418.483	589 163 940	$\Omega$	589 163 940
Il Total decrease in cash flow from operating activities (008 to 011)	012	38.408.970	739.850.137	12.853.624	1.018.857.361
A1) NET INCREASE IN CASH FLOW FROM FINANCIAL ACTIVITIES (007-012)	013	39.019.268	$\mathbf{a}$	40.415.465
A2) NET DECREASE IN CASH FLOW FROM OPERATING ACTIVITIES (012-007)	014	$\mathbf{0}$	75.938.685	$\bullet$	58.684.242
CASH FLOW FROM INVESTMENT ACTIVITIES
1. Cash receipts from sale of fixed tangible and intangible assets	015	22 818	$\overline{0}$	0
2. Cash receipts from sale of treasury and debt financial instruments	016	$\Omega$	$\Omega$	$\overline{\mathfrak{o}}$
3. Cash receipts from interests	017	140 154	28.249	0	32.078
4. Cash receipts from dividends	018	$\overline{0}$	O	$\overline{0}$
5. Other cash receipts from investment activities	019	$\overline{0}$	150 486 655	$\sigma$	146-471-320
III. Total cash receipts from investment activities (015 to 019)	020	162.972	150.514.904	$\overline{\mathbf{0}}$	146.503.398
1. Expenditures for buying fixed assets and intangible assets	021	1.992.463	975 871	7 400 328	15 850 517
2 Expenditures for purchasing treasury and debt financial instruments	022	56 124	$\Omega$	7 180 267
3. Other expenditures from investment activities	023	39.041.024	67 450 109	25 337 018	72.924.498
	024	41.089.611	68.425.980	39.917.613	88.775.015
IV. Total expenditures from investment activities (021 to 023)
B1) NET INCREASE IN CASH FLOW FROM INVESTMENT ACTIVITIES (020-024)	025	$\bf{0}$	82.088.924	$\bf{0}$	57.728.383
b2) NET DECREASE IN CASH FLOW FROM INVESTMENT ACTIVITIES (024-020)	026	40.926.639		39.917.613
CASH FLOW FROM FINANCIAL ACTIVITIES
1. Cash receipts from issuance of treasury and debt financial instruments	027	$\mathbf 0$	$\overline{0}$ $\Omega$	$\overline{0}$
2. Cash receipts from loan principal, bonds, borrowings and other loans	028	852 299 ō		11.654.209 $\overline{0}$
3. Total cash receipts from financial activities	029		4 500 000		13 382 273
V. Total cash receipts from financial activities (027 to 029)	030	852.299	4.500.000	11.654.209	13.382.273
1 Expenditures for repayment of loan principal and bonds	031	0		0 $\overline{0}$	6 505 447
2. Expenditures for payment of dividends	032	$\overline{0}$	$\overline{0}$
3. Expenditures for financial leasing	033	444 771	4 432 238	168.238	4 622 794
4 Expenditures for redemption of treasury shares	034	0	o	$\circ$
5 Other expenditures from financial activities	035	$\overline{0}$	$\Omega$	$\Omega$
VI. Total expenditures from financial activities (031 to 035)	036	444.771	4.432.238	168.238	11.128.241
C1) NET INCREASE IN CASH FLOW FROM FINANCIAL ACTIVITIES (030-036)	037	407.528	67.762	11.485.971	2.254.032
C2) NET DECREASE IN CASH FLOW FROM FINANCIAL ACTIVITIES (036-030)	038	$\bf{0}$		$\bf{0}$
Total increase in cash flow (013 - 014 + 025 - 026 + 037 - 038)	039	Ô	6 218 001	11 983 823	1 298 173
Total decrease in cash flow $(014 - 013 + 026 - 025 + 038 - 037)$	040	1 499 843		$\Omega$
Cash and cash equivalents at the beginning of the period	041	9.691.818	5.546.106	$\mathbf{0}$	30.068.631
Increase in cash and cash equivalents	042	$\bf{0}$	6.218.001	11.983.823	1.298.173
Decrease in cash and cash equivalents	043	1.499.843		$\mathbf{0}$
Cash and cash equivalents at the end of the period	044	8.191.975	11.764.107	11.983.823	31.366.804

VI. STATEMENT OF CHANGES IN EQUITY

Name of position:	AOP	Previous period	Current period	Previous period	Current period
		DALEKOVOD is c		DALEKOVOD GROUP
1.	$\overline{2}$	3	4	5	6
1. Share capital	001	286.726.500	187.194.330	286.726.500	187.194.330
2. Capital reserves	002	80.478.889	86.750.590	80.478.889	86.750.590
3. Reserves from profit	003	157.131.299	44.367.886	183.334.825	70.279.595
4. Retained profit or loss carried forw ard	004		$-159.390.318$	$-427.543.269$	$-111.412.611$
5. Profit or loss of current year	005	$-159.390.318$	239.483.555	$-122.216.466$	207.954.628
6. Revaluation of longterm tangible assets	006	40.014.573	40.014.573	40.014.627	40.014.573
7. Revaluation of intangible assets	007
8. Revaluation of financial assets available for sale	008	٥			$\mathbf{0}$
9. Other revaluations	009				n
10. Total equity and reserves (AOP 001 to 009)	010	$-36.279.739$	438.420.616	40.795.106	480.781.105
11. Foreign exchange differences arising from the titles of net investment in foreign operations	011	Ω	n		0
12. Current and deferred taxes (part)	012	$\mathbf{0}$	0	0	$\mathbf 0$
13. Cash flow protection	013	$\bf{0}$	o	۵	$\mathbf{0}$
14. Changes in accounting policies	014	$\overline{0}$	$\mathbf 0$	Ō	$\mathbf 0$
15. Correction of significant errors in the previous period	015	$\mathbf 0$	$\mathbf 0$	0	$\mathbf{0}$
16. Other changes in equity	016	0	0	0	$\mathbf{0}$
17. Total increase or decrease in equity (AOP 011 to 016)	017	o	$\mathbf o$	o	$\mathbf o$
17 a. Attributed to parent company equity holders	018			40.795.106	480.781.104
17 b. Attributed to minority interest	019			$-215.270$	$-221.032$

VII. NOTES TO FINANCIAL STATEMENTS

1. MANAGEMENT BOARD MEMBERS

• 1. President: Goran Brajdić, M.Econ.
• 1. Member: Krešimir Anušić, M.El.Eng.
• 1. Member: Marko Jurković, M.El.Eng.
• 1. Member: Željko Lekšić, MSc Econ., M.Mech.Eng.

2. SUPERVISORY BOARD MEMBERS

President: Marko Lesić Member: Ivan Peteržilnik Member: Vlado Čović. Member: Viktor Miletić Member: Krešimir Ružđak.

3. SHAREHOLDING STRUCTURE (as at 30 June 2014)

FIZIČKE OSOBE	1.538.223
MIROVINSKI FONDOVI	779.028
BANKE	331.118
KONSOLIDATOR d.o.o.	15.000.000
OSTALI	806.815
VLASTITE DIONICE	43.934
UKUPNO	18.719.433

4. MERGERS AND CONSOLIDATIONS

There were no mergers or consolidations in the first half of 2014.

5. UNCERTAINTY

No items of doubtful and disputable debt affecting business continuity were identified in the first half of 2014.

6. DESCRIPTION OF PRODUCTS AND SERVICES

Over time, Dalekovod d.d. has become specialized in performing contracts on a turnkey basis in the following areas:

• electrical facilities, especially transmission lines between 0.4 and 500 kV $\bullet$
• transformer stations of all levels and voltages up to 500 kV $\bullet$
• air, underground and underwater cables up to 110 kV $\bullet$
• telecommunication facilities $\bullet$
• all types of networks and antennas
• production of suspension and joining equipment for all types of transmission lines and transformer $\bullet$ stations 0.4 and 500 kV
• production and installation of all metal parts for roads, especially for road lighting, security barriers and $\blacksquare$ traffic signals
• tunnel lighting and traffic management $\bullet$
• electrification of railway and tramways $\mathbf{r}$

7. CHANGES IN ACCOUNTING POLICIES

There are no new accounting policies.