Management Board`s Report on activities of Centrum Medyczne

Transcription

Management Board's Report
on activities of Centrum Medyczne
ENEL-MED S.A. in 2014
Warsaw, 17 March 2015.
Table of contents
Table of contents
1.
BASIC INFORMATION ON CENTRUM MEDYCZNE ENEL-MED S.A. CAPITAL GROUP …………………………………………………..4
1.1.
Description of the structure of the Capital Group ...............................................................................................................4
1.2.
Management Board and Supervisory Board .......................................................................................................................5
1.3.
Shareholding structure ........................................................................................................................................................6
2.
CHARACTERISTICS OF ACTIVITIES OF CENTRUM MEDYCZNE ENEL-MED S.A. ................................................................ 8
2.1.
Description of the activity of Centrum Medyczne ENEL-MED…………………………………………………………………………………………8
2.2.
Multi-profile clinics .............................................................................................................................................................. 9
2.3.
ESTELL Aesthetic Medicine Clinic....................................................................................................................................... 12
2.4.
In-company clinics ............................................................................................................................................................. 12
2.5.
Hospitals and diagnostic imaging ...................................................................................................................................... 12
2.6.
Partner facilities ................................................................................................................................................................. 13
2.7.
Basic patient types depending on the settlement method ............................................................................................... 13
2.8.
Information on basic services, their values and quantities and their shares in sales ........................................................ 14
2.9.
Information on sales markets ............................................................................................................................................ 14
2.10. Significant agreements ...................................................................................................................................................... 14
3.
RISK FACTORS AND THREATS ..................................................................................................................................... 17
3.1.
Risk arising from deterioration of the financial situation of the Company’s clients ......................................................... 17
3.2.
Risk arising from becoming dependent on clients and distribution channels ................................................................... 17
3.3.
Risk of change in the contracting policy of the National Health Fund ............................................................................. 17
3.4.
Risk of medical malpractice in relation to the Company’s patients .................................................................................. 17
3.5.
Risk of a pandemic or epidemic ......................................................................................................................................... 17
3.6.
Risk associated with sensitive data processing ................................................................................................................. 18
3.7.
Risk of significant change in the macroeconomic situation in Poland .............................................................................. 18
3.8.
Risk of significant foreign exchange fluctuations ............................................................................................................. 19
3.9.
Risk of significant changes in interest rates ....................................................................................................................... 19
3.10. Credit risk ........................................................................................................................................................................... 19
3.11. Liquidity risk....................................................................................................................................................................... 20
3.12. Risk of changes in legal regulations and their interpretations 20
3.13. Risk of more intense domestic and foreign competition in the market ............................................................................ 20
4.
BASIC ECONOMIC AND FINANCIAL RATIOS. THE COMPANY’S DEVELOPMENT PROSPECTS ........................................ 21
4.1.
Selected financial data ....................................................................................................................................................... 21
4.2.
Financial factors and events influencing achieved financial results .................................................................................. 21
4.3.
5.
Prospects of business activity development. The Company’s development strategy for the years 2014-2016…………….22
ADDITIONAL INFORMATION ........................................................................................................................... 23
5.1.
Information on organisational or capital relationships of Centrum Medyczne ENEL-MED S.A.
with other entities and presentation of domestic and foreign investments thereof ........................................................ 23
5.2.
Information on significant transactions concluded by the Company or its subsidiaries with related parties pursuant to
non-arm’s length conditions .............................................................................................................................................. 23
5.3.
Information on concluded and terminated credit and loans agreements ........................................................................ 24
Management Board's Report on activities of Centrum Medyczne ENEL-MED S.A. in 2014
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Table of contents
5.4.
Information on granted loans with particular focus on the loans granted to
related parties ................................................................................................................................................................... 24
5.5.
Information on warranties and guarantees granted and received ................................................................................... 25
5.6.
Explanation of differences between financial results published in the annual report and previously announced annual
forecasts for a given year .................................................................................................................................................. 25
5.7.
Evaluation of financial resources management ................................................................................................................ 25
5.8.
Evaluation of potential implementation of investment projects ...................................................................................... 25
5.9.
Evaluation of factors and non-standard events influencing the result of business activity .............................................. 25
5.10. Description of external and internal factors material for the development of the enterprise
and description of the development prospects of the Company’s business activity ........................................................ 26
5.11. Changes in the basic management principles of the Company and its capital group ....................................................... 26
5.12. Agreements concluded between the Company and the managing persons that stipulate compensation for the
resignation or loss of office without important reasons, or if their deposition
follows the Company's merger by acquisition ................................................................................................................... 26
5.13. Value of remuneration, rewards or benefits for persons managing and supervising the Company ................................. 27
5.14. Information on total number and nominal value of all shares and shares in
the related parties held by members of the management and supervisory boards of the Company .............................. 28
5.15. Information on agreements known to the Company that might in the future result in changes
of proportions of shares held by existing shareholders and bondholders ........................................................................ 28
5.16. Information on the system of control over employee shares ........................................................................................... 28
5.17. Information on proceedings pending before a court, competent arbitration authority
or public administration body concerning liabilities and receivables ............................................................................... 28
5.18. Objectives and methods of financial risk management .................................................................................................... 28
6.
ENTITY AUTHORISED TO AUDIT FINANCIAL STATEMENTS .......................................................................................... 30
7.
CORPORATE GOVERNANCE........................................................................................................................................ 31
7.1.
Corporate governance principles ...................................................................................................................................... 31
7.2.
Information on exceptions in application of corporate governance principles ................................................................ 31
7.3.
Description of key features of internal control system and risk management system applied by the Company
with respect to the process of drawing up financial statements ...................................................................................... 32
7.4.
Significant share packages ................................................................................................................................................. 33
7.5.
Special control rights ......................................................................................................................................................... 33
7.6.
Limitation of voting rights from existing shares ................................................................................................................ 34
7.7.
Limitations with respect to transferring the title to securities .......................................................................................... 34
7.8.
Principles for appointing and recalling members of the Management Board and their rights, in particular
the right to make decision on issue or buy-out of shares ................................................................................................. 34
7.9.
Principles for amending the Company’s Articles of Association ....................................................................................... 34
7.10. Manner of operation of the Company’s General Meeting and fundamental powers thereof, shareholders’ rights
and the manner of their exercising ................................................................................................................................... 34
7.11. Composition and operation of the Company’s management and supervisory authorities and its committees ............... 35
8.
EVENTS AFTER THE BALANCE SHEET DATE ................................................................................................................. 38
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1. Basic information on Centrum Medyczne ENEL-MED S.A. capital group
1. BASIC INFORMATION ON CENTRUM MEDYCZNE ENEL-MED S.A. CAPITAL
GROUP
1.1. Description of the structure of the Capital Group
Centrum Medyczne ENEL-MED S.A. (hereinafter referred to also as ENEL-MED or the Company) is a part of the
Capital Group which as at 31 December 2014 comprised Centrum Medyczne ENEL-MED S.A. being the parent
company and the following subsidiaries: Enelbud sp. z o.o. and Centrum Medyczne Diagnostyka Obrazowa sp. z o.o.
Centrum Medyczne ENEL-MED S.A.
Centrum Medyczne
Diagnostyka Obrazowa
sp. z o.o.
Enelbud sp. z o.o.
Enelbud sp. z o.o. - the company established in 2006, it has been engaged in real property investments in the healthcare
sector. The parent company - Centrum Medyczne ENEL-MED S.A. - holds 80 shares in this subsidiary, which accounts for 80%
of the share capital. Furthermore, Enelbud sp. o.o. holds 40% of shares in the company trading as Bonus Vitae Sp. z o. o. with
planned objective of business activity being long-term medical care for the Elderly. In addition, in 2014 Enelbud sp. z o.o.
purchased 40% of hares in the company trading New Media Development & Hotel services sp. z o.o. with planned objective
of business activity being investments in buildings and real estate held for long-term health care services that will be rented
by Bonus Vitae sp. z o.o. As at 30 September 2013 Enelbud sp. z o.o. held 40% of shares in New Media Development & Hotel
Services sp. z o.o. In the fourth quarter of 2014 shares in this company were sold to New Media Communication sp. z o.o.
hence as at the publication date of this Report Enelbud sp. z o.o. did not hold shares in New Media Development & Hotel
Services sp. z o.o.
Centrum Medyczne Diagnostyka Obrazowa sp. z o.o. – the company was established in the fourth quarter of 2013 and the
issuer has taken up 50 shares of total nominal value of PLN 5,000.00, which represented 100% of the share capital of this
company. On 29 May 2014, the Extraordinary Meeting of Shareholders of Centrum Medyczne Diagnostyka sp. z o. o. adopted
a resolution on increasing the share capital of the company from the amount of PLN 5,000.00 to the amount of PLN
50,995,000.00, by issuing 509,950 new shares of the nominal value of PLN 100.00 each. All the newly established shares were
taken up by the Company on 29 May 2014 and paid for in full by in-kind contribution in a form of 5,000 shares in Centrum
Medyczne Diagnostyka Sp. z o.o. of the nominal value of PLN 100.00 each, of total nominal value PLN 500,000.00. The
contributed shares constituted 100% of shares in the share capital of Centrum Medyczne Diagnostyka Sp. z o.o. On 30 June
2014 Centrum Medyczne Diagnostyka Obrazowa sp. z o.o. sold 100% of shares in the share capital of Centrum Medyczne
Diagnostyka sp. z o.o. and thus ceased to be a partner in Centrum Medyczne Diagnostyka sp. z o.o. Presently, the main asset
of Centrum Medyczne Diagnostyka Obrazowa sp. z o.o. are the funds from which the Issuer shall finance development of the
Capital Group.
In 2014, there was a change in the Issuer's capital group. In connection with the conclusion of a purchase-sale agreement for
100% of shares in the share capital of Centrum Medyczne Diagnostyka sp. z o.o. on 30 June 2014 by Centrum Medyczne
Diagnostyka Obrazowa sp. z o.o. for the benefit of LUX MED Diagnostyka sp. z o.o., the Issuer lost control over Centrum
Medyczne Diagnostyka sp. z o.o.
As at 31 December 2014, the Issuer consolidates the following companies: Enelbud sp. z o.o. and Centrum Medyczne
Diagnostyka Obrazowa sp. z o.o. using the full method and Bonus Vitae sp. z o.o. using the equity method.
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1.2. Management Board and Supervisory Board
The Management Board of Centrum Medyczne ENEL-MED S.A.
Adam Rozwadowski - President of the Management Board
Mr Rozwadowski has held the position of the President of the Management Board
since 2006. A graduate of Gdańsk University of Technology. In the years 1972-1985,
Mr Rozwadowski worked at STOEN as the manager of the general technical
department and in the years 1985-1995 as the Director of the Office of Design and
Implementation of Investments. Since 1993, Mr Rozwadowski has been managing
Centrum Medyczne ENEL-MED, first as the General Director and later as the
President of the Management Board. In addition, Mr Rozwadowski is the Deputy
President of the National Association of Private Hospitals [Ogólnopolskie
Stowarzyszenie Szpitali Prywatnych] and a Member of the Management Board of
Polish Union of Private Healthcare Employers [Ogólnopolski Związek Pracodawców
Prywatnej Służby Zdrowia].
Jacek Rozwadowski - Deputy President of the Management Board, CEO
Mr Rozwadowski has been performing the duties of the Deputy President of the
Management Board since 2009. Mr Rozwadowski has been working for the
Company since 2002 and since 2008 has held the position of CEO. A graduate of the
School of Business and Administration in Warsaw. Before joining the medical sector,
Mr Rozwadowski had been working in the automotive industry. In years 1999
– 2002, Mr Rozwadowski dealt with marketing and sales at DAF Trucks Polska Sp. z
o.o. Before that, Mr Rozwadowski had worked for a year for DAF Trucks NV Holland
where he was responsible for sales in Poland. In the years 1996–1998, he was a
project manager at Elektrim S.A.
Composition of the Management Board as of the publication date of the annual report did not changed.
Supervisory Board of Centrum Medyczne ENEL-MED S.A.
Anna Rozwadowska
Chairperson of the Supervisory Board
Mrs Rozwadowska has been associated with the Company since its inception. A graduate of Gdańsk University of Technology,
the Faculty of Electrical Engineering. Mrs Rozwadowska has held the position of Deputy President and Member of the
Management Board. Mrs Rozwadowska has developed Centrum Stomatologii ENEL-MED (Stomatology centre). In 1994 Mrs
Rozwadowska founded Postgraduate Training Centre for Dentists, which trained professionals from all over the country.
While managing the Operational Department Mrs Rozwadowska is responsible for ensuring quality and financial efficiency of
the Company's branches, patient's service quality and coordination of newly opened branches. In the Supervisory Board Mrs
Rozwadowska bears the responsibility for internal audits.
Anna Piszcz
Member of the Supervisory Board
The Member of the Supervisory Board since 2006. A Ph.D. at law, Mrs Piszcz has been an employee of the Faculty of Law, at
the University of Białystok since 2006, initially as an Assistant in the Department of Administrative Law and since 2006 as an
Assistant Professor in the Department of Public Economic Law. Legal advisor in years 2010-2012, a partner in RES Law Firm of
legal advisor Jerzy Bieluk and partners. In 2014 Mrs Piszcz has been appointed a member of the Advisory Board at the
President of the Office of Competition and Consumer Protection.
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Janusz Jakubowski
A graduate of the Warsaw University of Technology, construction engineer. Initially, related to ENEL-MED in the years 1991–
1993, when as the Investment Director Mr Jakubowski was responsible for building the first ENEL-MED clinic and hospital in
Warsaw. Employed again in 2005, as Investment Department Director Mr Jakubowski is responsible for planning,
implementation and ongoing supervision of the Company's construction investments. Mr Jakubowki's earlier professional
experience includes work for Beton-Stal as a construction engineer and later as the Coordinator of the General Contractor of
CHP “Kawęczyn“. In 1989–1991, Mr Jakubowski was a building contractor. For a year, Mr Jakubowski performed the duties of
a Supervision Inspector on behalf of the EBRD bank at the implementation of the Business Centre Wola project. For another 8
years, Mr Jakubowski cooperated with Skanska Poland, among others, as Development Director and Executive Director. Mr
Jakubowski is responsible for performance of: Złote Tarasy, Terminal II at the Okęcie Airport, Atrium office complex in
Warsaw and the Westin Hotel. In 2002–2004 Mr Jakubowski was the Development Director for ROBYG development
company. In the years 2004–2005, Mr Jakubowski was the Director General at RD bud, a branch of Rabot Dutilleul.
Adam Ciuhak
A graduate of the Faculty of Economics and Production Organisation (specialisation: Economics and Industry Organisation),
Warsaw School of Economics. A tax consultant and the President of the Management Board of Strategia Sp. z o. o. and
Strategia Consulting Sp. z o. o. Mr Ciuhak began his career in 1993, at BDO Polska Sp. z o. o. as a Statutory Auditor’s Senior
Assistant, holding this position until 1998. In 1998–2000, Mr Ciuhak was the Chief Financial Officer in Animex S.A. Since 2000,
Mr Ciuhak has been an Advisor to the President of the Management Board in Animex S.A.
Zbigniew Okoński
A graduate of the Foreign Trade Department of the University of Gdańsk and the Faculty of Marine Fisheries at the
Agricultural Academy in Szczecin. Mr Okoński completed the Global Leadership Programme at the Faculty of Business
Administration at the University of Michigan (USA). The President of the Management Board of ROBYG S.A. In the years
1991–1992 Under-secretary of State in the Ministry of Economic Cooperation with Foreign Countries. In subsequent years,
Mr Okoński held the positions of: the President of the Supervisory Board in the State Agency for Foreign Investment, the
President of the Supervisory Board in Bank Rozwoju Eksportu S.A., Advisor to the President of the Management Board and
Director for Coordination of Commerce in Elektrim S.A., Member of the Management Board and Deputy Director General in
Elektrim-Volt S.A., the President of the Supervisory Board in Nafta Polska S.A., Deputy President of the Management Board in
Prokom Investments S.A., Member of the Supervisory Board and later the President of the Management Board in Polnord
S.A. and the President of the Management Board in EnergoPlasma Sp. z o.o. In addition, in 1995, Mr Okoński performed the
duties of the Minister of National Defence.
Composition of the Supervisory Board as of the publication date of the annual report did not changed.
1.3. Shareholding structure
As at 31 December 2014 the share capital amounted to PLN 23,566,900.00 and was divided into 23,566,900 shares with a
nominal value of PLN 1.00 each. As at the publication date of this Report on activities of the Company this situation did not
change.
According to the information available to the Company in 2014 Jacek Jakub Rozwadowski, the Deputy President of the
Management Board increased the number of the Issuer's shares held. According to the notification received from Jacek Jakub
Rozwadowski as a result of sales transaction of 1,576 shares, made during a session at the Stock Exchange in Warsaw, the
number of shares held and the number of votes controlled by Jacek Jakub Rozwadowski was increased from 992,800 to
994,376 shares which corresponds to 994,376 votes at the Company's General Meeting of the Shareholders and accounts for
4.22% of share in the capital and 4.22% of votes at the Company's GMS.
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Shareholding structure as at 31 December 2014 was as follows:
Shareholder
% of capital
Number of votes
% of votes
Adam Stanisław Rozwadowski*
Number of
shares
7.124.000
30.23
7.124.000
30.23
Anna Maria Rozwadowska*
7.123.950
30.23
7.123.950
30.23
Generali OFE (Open Pension Fund)
2.377.000
10.09
2.377.000
10.09
OFE PZU ,,Złota Jesień” (Open Pension
Fund)
Jacek Jakub Rozwadowski*
1.680.000
7.13
1.680.000
7.13
994.376
4.22
994.376
4.22
972.650
4.13
972.650
4.13
3.294.924
13.97
3.294.924
13.97
Bartosz Adam Rozwadowski*
Other Shareholders
* presumption of an agreement exists between Anna Maria Rozwadowska, Jacek Jakub Rozwadowski and
Bartosz Adam Rozwadowski.
Other
13.97%
Bartosz Rozwadowski
4.13%
Bartosz Rozwadowski
Adam Rozwadowski
30.23%
4.22%
OFE PZU ,,Złota Jesień”
7.13%
Generali OFE
10.09%
Bartosz Rozwadowski
30.23%
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2. Characteristics of activities of Centrum Medyczne ENEL-MED S.A.
2. CHARACTERISTICS OF ACTIVITIES OF CENTRUM MEDYCZNE ENEL-MED S.A.
2.1. Description of activities of Centrum Medyczne ENEL-MED
Centrum Medyczne ENEL-MED S.A. is a private provider of medical services in Poland that has been present on the Polish
healthcare market since 1993.
The Company operates 20 medical facilities including 19 multi-profile clinics (together with six in-company clinics) and two
hospitals located in Warsaw as well as ESTELL Aesthetic Medicine Clinic.
The multi-profile clinics and the aesthetic medicine clinic are situated in attractive localisations (for example in prestigious
shopping malls and office buildings) in six big cities: in Warsaw (the Centres of Zacisze, Atrium, Blue City, Arkadia, Puławska,
Domaniewska, Centrum, the ESTELL Aesthetic Medicine Clinic), Cracow (Galeria Krakowska Centre), Poznań (Kupiec
Poznański Centre), Łódź (Manufaktura Centre), Gdańsk (Grunwaldzka Centre) and Wrocław (Arkady Wrocławskie Centre). Incompany clinics, that is small branches situated on corporate client’s premises, offering a basic range of services only to the
employees of a given client, are located in Warsaw, Piła and Łódź. The only exception is the facility located in the Special
Economic Zone, the Sub-Zone of Wrocław-Kobierzyce, which is used by the employees of companies belonging to the LG
Cluster together with their families, as well as individual patients who are not employed in the companies with whom ENELMED signed agreements on medical services. In addition, ENEL-MED cooperates with over 1,300 partners whose clinics are
located in localities where the Company does not have its own medical facilities.
Moreover, the Company operates two hospitals in Warsaw: the multi-specialisation 20-bed Zacisze Hospital and the 30-bed
Centrum Hospital located at Aleja Solidarności 128. In hospitals and in the multi-profile clinic in Gdańsk, ENEL-MED runs
diagnostic centres equipped with magnetic resonance imaging and computed tomography devices (Centrum Hospital and
Zacisze Hospital), as well as magnetic resonance imaging scanner in Gdańsk.
The medical services provided by the Company include but are not limited to:
• primary and specialised outpatient care, including rehabilitation and surgical procedures at outpatient clinics
• dental health care,
• diagnostic imaging tests (including tests performed using magnetic resonance, computed tomography scanner, ultrasound
cameras and X-ray)
• hospitalisation, including surgical procedures and surgeries in selected specialisation areas, scheduled at Zacisze Hospital
and Centrum Hospital
• off-site medicine and emergency home visits as well as medical care in case of sudden illness.
• aesthetic medicine, cosmetology, aesthetic gynaecology.
ENEL-MED offers a wide range of medical services used by both patients who pay for each service provided and clients with
prepaid medical care packages. One can also use selected services under National Health Fund. Furthermore, ENEL-MED has
signed contracts for medical care of patients with multiple insurance companies such as Allianz, PZU Pomoc, Generali, Inter
Polska, Signal Iduna and Uniqa. The Company’s settlements with the insurance companies are effected on a fee-for-service
basis.
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2.2. Multi-profile clinics
Centrum Medyczne ENEL-MED S.A. operates 13 multi-profile clinics situated in attractive and prestigious locations (including
shopping malls and office buildings), in six major urban centres: Warsaw, Cracow, Poznań, Łódź, Gdańsk and Wrocław.
ENEL-MED clinics offer comprehensive medical care services both primary and specialist ambulatory care, including dental
health care and rehabilitation. The multi-profile clinic in Gdańsk additionally provides services in the field of diagnostic
imagining - performing magnetic resonance imaging tests.
Gdańsk
Łódź - Manufaktura Centre
Kraków – Galeria Krakowska Centre
Gdańsk – Grunwaldzka Centre
Wrocław – Arkady Wrocławskie Centre
Poznań – Kupiec Poznański Centre
Warsaw
Poznań
Łódź
Wrocław
Kraków
Warsaw:
Zacisze Centre
Atrium Centre
Blue City Centre
Arkadia Centre
Puławska Centre
Domaniewska Centre,
Centrum Centre
Promenada Centre
ESTELL - aesthetic medicine
In Warsaw, there are 8 centres in total: clinics in office buildings of Atrium Plaza and Trinity Park III
(Atrium Centre and Domaniewska Centre), clinics at prestigious shopping malls such as Arkadia, Promenada or Blue City.
Clinic at Puławska Street (Puławska Centre) and the clinic operating on the premises of the Company’s hospital at Gilarska
Street (Zacisze Centre). Additionally, the Centrum Hospital fulfils the function of a clinic, where specialist consultations are
held.
ATRIUM CENTRE
ARKADIA CENTRE
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BLUE CITY CENTRE
PUŁAWSKA CENTRE
DOMANIEWSKA CENTRE
ZACISZE CENTRE
CENTRUM CENTRE
PROMENADA CENTRE
ESTELL – AESTHETIC MEDICINE CLINIC
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General medical clinics of the Company located in Cracow, Poznań, Łódź and Wrocław are situated in shopping malls. In
Poznań, the clinic is located in the Kupiec Poznański Shopping Mall in Łódz - in the Manufaktura Shopping Mall, in Wrocław the Arkady Wrocławskie Shopping Mall, in Cracow - in the Galeria Krakowska Shopping Mall, while in Gdańsk - in the office
building of Office Island (Grunwaldzka Centre).
GALERIA KRAKOWSKA CENTRE
MANUFAKTURA CENTRE
ARKADY WROCŁAWSKIE CENTRE
GRUNWALDZKA CENTRE
KUPIEC POZNAŃSKI CENTRE
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2.3. ESTELL Aesthetic Medicine Clinic
The new brand of ENEL-MED founded in December 2014. This is
the first profiled facility of the Company devoted to commercial
services. The clinic offers a wide range of services in the field of
cosmetology, medicine and aesthetic gynaecology, including:
• Rejuvenating and anti-ageing skin treatments
• Lines and wrinkles removal
• Reduction of shadows and puffiness under eyes
• Phototherapy, laser treatments
• Reduction of skin discolouration and pigment lesions
• Reduction of body fat
• Removal of vascular damages and spider veins
ESTELL clinic is located in the Senator building at ulica
Bielańska 12 in Warsaw.
2.4. In-company clinics
ENEL-MED operates six in-company clinics that is small branches situated on several big corporate client’s premises, offering
a basic range of services only to employees of a given client. Two in-company clinics are located in Warsaw – on the premises
of the National Bank of Poland and Bank Millennium S.A. The remaining clinics are located: in Łódź, on the premises of
Sonoco Poland - Packaging Services sp. z o.o. and in Rosmann Supermarkety Drogeryjne Polska sp. z o.o. in Piła on the
premises of Philips Lighting Poland S.A. and in the Special Economic Zone, the Sub-Zone of Wrocław-Kobierzyce on the
premises of LG Display Poland sp. z o.o. Services offered by the clinic located on the premises of LG can be used not only by
the employees of companies from the LG Cluster with their families, but also by commercial clients.
2.5. Hospitals and diagnostic imaging
In 1998 Centrum Medyczne ENEL-MED S.A. started offering
hospital services by opening a multi-specialisation hospital in
Warsaw at Gilarska Street. Currently, the hospital offers 20 beds,
two operating rooms and among others anaesthesia consultation
room and diagnostic and treatment room. The hospital also
performs highly specialised diagnostic tests using magnetic
resonance imaging or computed tomography scanners. There is
also a multi-profile clinic at the same location but within a separate
space.
The Zacisze Hospital offers services in the fields of: general surgery,
paediatric surgery, vascular surgery, plastic surgery, laryngology,
gynaecology, ophthalmology and urology.
In 2012 ENEL-MED opened a second hospital in Warsaw
- Centrum Hospital, located at Aleja Solidarności 128. The newly
opened hospital offers 30 beds, two operating rooms and one
postoperative recovery room. The hospital also houses a modern
diagnostic imaging facility that offers a wide range of diagnostic
tests
12
among others using magnetic resonance and computed tomography scanners. Additionally, the hospital fulfils the function of
a clinic providing specialist consultations. Moreover, emergency orthopaedic care is available 24 hours a day, 7 days a week.
The Centrum Hospital offers services in the area of spine surgery, orthopaedics and hand surgery.
Patients may use hospital services against a payment or under the contract with the National Health Fund concluded by the
Company on a selected group of treatments and surgeries. The contract for hospital services concluded with the National
Health Fund, pertaining to scheduled operations, includes the following groups of services:
• orthopaedics
• neurosurgery
• vascular surgery
• general surgery
• ophthalmology
• otolaryngology
Given the considerable potential of the hospitals that exceeds the limits ensured by the contract with the National Health
Fund, the Issuer offers a wider range of services within the commercial operations which are not covered by the contract
with the NHF. The most commonly used paid treatments are performed in the fields of:
• orthopaedics
• neurosurgery
• ophthalmology
• vascular surgery
• laryngology
2.6. Partner facilities
In order to ensure the Company's clients, who have prepaid medical care packages, a nationwide access to medical services
in cities where ENEL-MED does not have its own medical facilities, the Issuer is supported by the partner facilities, acting as
subcontractors. If it is necessary to start cooperation with a new medical facility, an employee from the Corporate Client
Service Department carries out an initial interview and verifies the scope of services of a given facility and the quality of
medical services based on the Medical Care Organisation Standards developed by the Company. After the negotiation
process is completed and the contract is signed, the partner facility receives the updated lists of patients who have prepaid
medical care packages together with the scope of medical services to which each patient is entitled. The Company
cooperates with over 1,300 medical facilities all over the country.
2.7. Basic patient types depending on the settlement method
Medical services provided by Centrum Medyczne ENEL-MED can be used on the following bases:
Enel-Care - a package of medical services (the so-called prepaid medical care package); its monthly cost depends on the
scope of services, spatial distribution of persons covered by it, the size of a group; its cost is covered by a company that have
signed an agreement with us and its employees have the possibility of making additional payments to get partner or family
packages.
medi-care - the so-called health insurance for the predetermined scope of services dedicated to individual patients, offered
as a part of cooperation between the Company and InterRisk insurance company. However, the settlements between
InterRisk and the Company are carried out based on the fixed per capita rate and consequently, from the point of view of the
Company, the medi-care product is similar to the Enel-Care prepaid medical care packages.
Fee For Service (FFS) - this form of sale of services means that a payer (corporate client, insurance company) pays every time
a medical service is provided. The FFS system applies to three key groups of clients: individuals, customers of insurance
companies and a group of companies making the settlements with the Company on the FFS basis.
13
National Health Fund - in order to satisfy customers' needs, it is also possible to refer a patient to receive particular hospital
or diagnostic services under the contract between the Company and the National Health Fund. In this case, the cost of
services is covered from public funds without any additional payments made by a patient.
2.8. Information on basic services, their values and quantities and their shares in sales
Centrum Medyczne ENEL-MED S.A. operates on the national market of medical services. The activities of the Company are
focused on four key market sectors (outpatient clinics, hospitalisation, diagnostics and dental care).
Value and structure of revenues by Medical Services
SALES
Medical Service
2013
DIAGNOSTICS *
35,902,984
HOSPITAL *
DENTISTRY
CLINICS + ENEL-CARE
share
2014
18,963,543
10,742,862
5.40%
12,292,703
5.90%
14.40%
23,776,599
11.90%
25,693,722
12.20%
8.10%
129,337,100
64.70%
152,823,380
72.90%
18.20%
0.00%
199,759,544
100.0%
9.00%
increase
18.00%
Adjustment for sales - NHF
TOTAL
share
-47.20%
0.00%
209,773,348
100.0%
5.00%
* together with internal settlements
** drop in revenues from Diagnostics was caused by contribution of a part of diagnostic centres constituting an organised part of the enterprise held to
operate in the field of diagnostics to Centrum Medyczne Diagnostyka sp. z o.o by the Company in 2014. Following, 100% of shares in Centrum
Medyczne Diagnostyka sp. z o.o. were contributed by the Company to Centrum Medyczne Diagnostyka Obrazowa sp. z o.o. In 2014 all the shares in
Centrum Medyczne Diagnostyka sp. z o.o. were sold and as a result the Company lost control over Centrum Medyczne Diagnostyka sp. z o.o.
2.9. Information on sales markets
The Company operates throughout Poland and does not depend on any client or supplier. None of the suppliers or clients
account for more than 10% of total sales revenues. The National Health Fund is still the biggest individual business partner of
the Company but its share in revenues decreased. In 2014, it was equal to 5.6%.
2.10. Significant agreements
Agreements presented below are the agreements significant for the Company’s activities in the opinion of the Management Board.
Agreement for sale of shares in subsidiary - Centrum Medyczne Diagnostyka sp. z o.o.
On 30 June 2014 the Company, a subsidiary under the business name Centrum Medyczne Diagnostyka Obrazowa Sp. z o.o.
and LUX MED Diagnostyka Sp. z o.o. with registered office in Warsaw concluded an agreement for sale of shares by Centrum
Medyczne Diagnostyka Obrazowa Sp. z o.o. (the Issuer's subsidiary) for the benefit of LUX MED Diagnostyka sp. z o.o., for the
sale of 100% of shares in the share capital of Centrum Medyczne Diagnostyka sp. z o.o. (subsidiary) comprising the following
diagnostic centres: Bielany Diagnostic Centre in Warsaw, Magnetic Resonance Laboratory in Konin, Magnetic Resonance
Laboratory in Mielec, Computed Tomography Laboratory in Poznań, Magnetic Resonance Laboratory in Łomża, Computed
Tomography Laboratory in Wołomin and the Diagnostic Laboratory in Lublin. The selling price for 100% of shares in Centrum
Medyczne Diagnostyka sp. z o.o was set at PLN 52,519,949.00.
Purchase of medical equipment from GE Medical Systems Polska Sp. z o.o.
Conclusion of an agreement with GE Medical Systems Polska sp. z o.o. for the purchase of 4 magnetic resonance imaging
scanners (Optima MR 360 Advance 1.5 and three magnetic resonance imaging scanners Signa HDxt 3.0 GoldSeal) and 11
ultrasound cameras Voluson S6 and ultrasound camera Voluson E6. The selling price for the medical equipment was
stipulated to be the gross amount of PLN 17,618,900.00.
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General loan agreement concluded with ING Finance sp. z o.o.
Conclusion of the general loan agreement under which ING Finance sp. z o.o. undertakes to grant the Company a loan in
order to purchase objects of financial in particular medical equipment (magnetic resonances scanners and ultrasound
cameras). The total value including VAT will not exceed the amount of PLN 17,400,000.
An agreement for the provision of medical services with ITI Neovision S.A.
Conclusion of an agreement for an indefinite period of time with ITI Neovision S.A. for the provision of medical services to
employees, persons cooperating with the company and their families. The value of the agreement may amount to
approximately PLN 5,880,000 within the period of 5 years.
Agreement with Canal+ Cyfrowy S.A.
Conclusion of an agreement with Canal+ Cyfrowy S.A. for the provision of medical services to employees, persons
cooperating with the company and their families. The above mentioned agreement was concluded for an indefinite period
and its value in the period of five years may amount to approximately PLN 2,400,000.
Continuation of medical service provision for Philips Lighting Poland S.A.
Conclusion of an agreement for the term of 3 years with Philips Lightening Poland S.A. for the provision of medical services,
including occupational medicine services and preventive care to the employees of Philips Lightening Poland S.A. and lease of
office space and equipment for the performance of the aforementioned services. The agreement begins the fourth year of
cooperation and its value shall amount to approximately PLN 2,340,000.00 net (receivables) during the period of its validity
and PLN 167,904.00 net in terms of liabilities.
Cooperation with Legia Warszawa S.A.
Conclusion of an agreement with Legia Warszawa S.A. for the lease of office space on the premises of the Club for the needs
of the specialised sports medicine centre. The agreement has been concluded for the term of 10 years and its value may
amount to approximately PLN 6,351,036.00 net. In addition, ENEL-MED covered players of the Club with medical care and
became an official medical partner of the Legia Warszawa Football Club. The value of the agreement in terms of both
liabilities and receivables amounted to approximately PLN 8,943,036.00.
Agreement for lease of space for the purpose of health care activity and aesthetic medicine.
Conclusion of an agreement with Union Investment Real Estate GmbH with registered office in Hamburg for the lease of
space in a building located at ul. Bielańska 12 in Warsaw. The office space leased houses ESTELL aesthetic medicine centre the new brand of ENEL-MED. The agreement has been concluded for the term of 10 years and its value may amount to
approximately PLN 5,646,662.09 gross.
Annex to the lease agreement for office space for the purpose of the multi-profile clinic in Poznań.
Conclusion of an agreement with Tenali Investments sp. z o.o. “Silesia Business Park” spółka komandytowo-akcyjna for the
lease of office space for the purpose of medical clinic located in Silesia Business Park in Katowice. The lease term is 10 years
since the date of the lease commencement that shall take place on 1 June 2015 and during the term of the agreement the
value shall amount to approximately PLN 9,955,630.40 net.
Lease agreement for office space for the purpose of the clinic located in Arkadia Shopping Mall in Warsaw.
Conclusion of an agreement with Arkadia Centrum Handlowe sp. z o.o. for the lease of office space for the purpose of the
multi-profile clinic operation located in Arkadia Shopping Mall in Warsaw, where ENEL-Med has been running its medical
facility since 2005. The agreement is in force until 29 September 2019 and the total value shall amount to approximately PLN
8,475,523.30 gross.
Lease agreement for office space for the purpose of the medical facility located in a building of Atrium Plaza in Warsaw
Conclusion of an agreement with Kite Duo sp. z o.o. for the lease of office space in a building of Atrium Plaza in Warsaw,
where ENEL-MED has been running its medical facility since 1999. According to the Management Board, the agreement
concluded changes, for the benefit of the Company, financial terms and conditions of the previously concluded agreement
the term of which would expire in the fourth quarter or 2017.
The agreement has been concluded for the lease of a part of office space for the term of 10 years and the second part
making up 1/5 of the leased space for the term of 9 years and 6 months. The total value of the agreement may amount to
approximately PLN 15,761,863.08 gross.
15
Significant agreements with the National Health Fund
Conclusion of a number of agreements with NHF for diagnostic tests and hospital treatment, carried out in own facilities of
ENEL-MED (the Company's hospitals and diagnostic laboratories). In the period presented the following agreements/annexes
have been concluded, the total value of which exceeded 10% of the Issuer's equity:
- annex to the agreement (report 1/2014) that was received by the Company on 14 January 2014 caused that the value of the
agreements concluded with NHF since the publication of the current report No. 8/2013 amounted to PLN 4,702,354.00 net.
- annex to the agreement (report 6/2014) that was received by the Company on 6 February 2014 caused that the value of the
agreements concluded with NHF since the publication of the current report No. 1/2014 amounted to PLN 7,995,320.00 net.
- annex to the agreement (report 7/2014) that was received by the Company on 10 February 2014 caused that the value of
the agreements concluded with NHF since the publication of the current report No. 6/2014 amounted to PLN 5,089,344.00
net.
Annexes to the agreements with Bank Millennium
On 21 March 2014 the Company concluded annexes to the agreements with Bank Millennium:
- annex increasing the value of long-term credit by the amount of PLN 1,973,151.00 to the total amount of PLN 10, 4000,000.00.
- annex reviewing the multi-product line, global limit granted to the Company in the amount of PLN 17,000,000.00 (decrease
by PLN 3,000,000.00 compared to the previous agreement).
Additionally, an annex to the multi-product line agreement was concluded on 11 August 2014. The bank granted the
Company the limit of PLN 15,000,000.00 (reduction of the limit by PLN 2,000,000.00 compared to the previous agreement)
for the period from 11 August 2014 to 24 April 2015.
Agreement with Property Experts company for provision of maintenance and daily services
Conclusion of an agreement with Property Experts sp. z o.o. on 11 August 2014 for provision of maintenance and daily
services in facilities of Centrum Medyczne ENEL-MED S.A. The agreement concluded caused that the value of the agreements
entered into by the Issuer with Property Experts sp. z o.o. in the last 12 months preceding the conclusion of the aforesaid
agreement amounted to PLN 9,627,346.20 net.
The Company Property Experts sp. z o.o. belongs to the same Capital Group as Proscan sp. z o. o. company, with which the
Issuer had previously signed an agreement on 31 October 2013 for the provision of maintenance and daily services in
facilities of Centrum Medyczne ENEL-MED S.A. (the value of the agreement for the term of 5 years since the day of its
conclusion amounted to PLN 7,365,424.20 net.) The agreement with Proscan sp. z o. o. was terminated as of 11 August 2014.
16
3. Risk factors and threats
3. RISK FACTORS AND THREATS
3.1. Risk arising from deterioration of the financial situation of the Company’s clients
The sale of prepaid medical care packages to corporate clients constitutes a significant source of the Company's revenue.
There is a risk that if the financial situation of a given client deteriorates significantly, the client could resign from offering
medical care to its employees, which is directly connected with termination of the agreement or reduction of the range of
provided services which would affect the Company's revenue. Another form of potential risk is the reduction of employment
at the client’s company, which could lead directly to a decrease in the related revenue. Nonetheless, the Company provides
services to more than 3,000 companies and the Issuer's clients cover also individual clients and insurance companies, thus
the resignation of one client or reduction of employment in a given company would not have a significant influence on the
Company’s revenue.
3.2. Risk arising from becoming dependent on clients and distribution channels
The main groups of the Company’s clients include corporate clients using prepaid medical care packages, patients of
insurance companies (ENEL-MED provides medical services to the clients of such insurers as: PZU Pomoc, Allianz, Generali,
Compensa, Inter Polska, Signal Iduna or Uniqa) as well as individuals. There is a risk that the share of a given client or a given
distribution channel in the Company’s revenue becomes so significant that the Company's financial results may deteriorate in
case of a loss of such a client or a decrease in the sales in a given channel. Given the above and in order to minimise the risk
of becoming dependent on one particular client or one distribution channel, the Company consistently pursues the policy of
diversifying its sources of revenue.
3.3. Risk of change in the contracting policy of the National Health Fund
The Company has many years’ experience in cooperation with the National Health Fund as it has concluded numerous
contracts with NHF for hospital treatment and diagnostic tests. Each year the contract value is determined for a given year
which means that there is always a risk of changes in the National Health Fund’s contracting policy, which may contribute to
a reduction in the related revenue. However, it should be noted that the sales to NHF in 2014 made up 5.6% of the
Company's revenue. The Issuer has undertaken a number of actions aiming at intensification of the commercial sale of
hospital services and diagnostic tests therefore, the Issuer is not dependent on a single payer in this field of activity.
3.4. Risk of medical malpractice in relation to the Company’s patient
The Company provides a considerable number of medical services, including medical consultations, diagnostic and laboratory
tests, as well as surgeries. As in the case with every medical facility, there is a risk that the Company’s medical personnel will
commit an act of medical malpractice in relation to a patient. As a result of such an act of malpractice, the Company may be
charged the costs of compensation and it may experience significant damage to its image and reputation. In order to
minimise this risk, the Issuer has implemented management and patient service procedures in such situations. A separate
unit has been established in the Issuer’s organisational structure which is responsible for the quality of medical services and
for the compliance of medical processes with the developed standards and procedures. Additionally, both the Company and
the physicians have taken out medical malpractice insurance policies in case of any malpractice.
3.5. Pandemic/epidemic risk
The Company provides medical services to a wide range of patients all over Poland. There is a risk that, in the event of a
pandemic or epidemic, the Issuer will be forced to provide services to a significantly larger number of patients, which may
negatively influence the Company’s financial performance and the effectiveness of its operations. In order to minimise this
risk, the Company has developed relevant procedures and standards of conduct to be followed in case of the abovementioned risk (the pandemic plan), which were to some extent used in
17
2009 when facing the threat caused by the A/H1N1 virus. The main rules of the developed pandemic plan provide for
preparing the method of dealing with the patients suspected to have an infection, changing the department’s work
organisation, conducting the campaigns that promote pro-health behaviour and minimise the risk of infection, introducing
quick diagnostic tests thanks to which viral infections may be differentiated and shortening the time spent on one visit during
the period of an increased number of visits.
3.6. Risk associated with sensitive data processing
The Issuer provides complex medical services nationwide. Keeping patients’ medical records means that the Company has
access to particularly protected sensitive data. There is a risk that an unintentional disclosure of sensitive data may occur in
the course of operating activities. In order to minimise the risk, the Issuer has developed and implemented the principles of
the personal data protection policy. In their daily work, all employees and partners of the Company are obliged to strictly
follow the aforementioned policy. The data protection policy functions as the procedure being a part of the quality
management system certified for compliance with ISO 9001:2008 standard. The correct process of safe personal data
processing is constantly monitored by the Chief Information Security Administrator at the registered office of the Issuer, as
well as by local Information Security Administrators who functions as the branch managers. Each and every employee and
partner must report to the Administrator any information about suspected cases of non-compliance with the personal data
protection policy. The role of the Information Security Administrator is to immediately analyse reasons of breaches and take
measures aimed at avoiding similar incidents in the future.
3.7. Risk of significant change in the macroeconomic situation in Poland
The Company carries out its business activities on the national market of medical services. For that reason, the financial
results achieved by the Issuer are also indirectly connected with such macroeconomic indicators as the GDP growth, the level
of unemployment, the growth dynamics of salaries and the level of inflation and interest rates. These factors indirectly
influence the demand for medical services both among corporate and individual clients, as well as among insurance
companies. They also influence the level of the budget of the National Health Fund, which is the largest individual client of
the Company.
In 2014, the Monetary Policy Council reduced the interest rates by 50 base points (bps). This decision was made in October
2014.Since that moment the reference rate has been 2%. It reached the lowest level in history. Throughout the entire 2014,
inflation was below the lower limit of the inflation target range, while in July the level dropped below zero. In December
2014, the Consumer Price Index (CPI) reached -1% year/year.
The beginning of 2014 was the continuation of the dynamics of GDP growth. In the first quarter it increased by 3.4%
year/year. By the end of the year the dynamics of GDP slowed down slightly. The Central Statistical Office estimates speak of
an increase by 3.0% in the fourth quarter, but throughout the year, the Polish economy has reached the level of approx. 3.2%
growth that is the value that was the average of the forecasts for 2014, published by the end of 2013. This situation occurred
despite the Ukrainian-Russian crisis. Despite the difficulties in trade with our two largest eastern neighbours, in 2014 Polish
exporters sold abroad goods of the value of EUR 163 billion which is 5.3% more than in 2013.
The influence of the expected changes in the dynamics of GDP growth, unemployment and real salaries should not have any
significant influence on the Company’s financial situation. It should be emphasized that the Company’s revenue is mainly
dependent on long-term contracts. Moreover, the Company’s services are used by individuals who higher income and who
will be able to afford to maintain the current expenditure structure even if the dynamics of the salary growth slows down - as
it was in 2012 and 2013. However, one should notice the increase in real salaries and decrease in structural unemployment.
A better economic situation in Poland is mainly consequence of the upturn of economy in the Euro zone, the increase in
export to other markets and the increase in consumption as a result of more optimistic expectations of consumers in the
scope of their situation in the future, as well as low interest rates. An improved situation is also noticeable in the area of
investments by enterprises. Still, the full use of aid funds of the next budget perspective did not start. It should be expected
that the ability to use these funds shall increase the intensity of the investments.
18
It should be emphasised that political risk related to unfavourable development of the international situation remains higher.
Events in Ukraine and intensification of Russian and Ukrainian relations and consequently relations between Russia and the
Western world may have significant impact not only on the Polish economy but also on financial markets. Political changes in
Greece and the risk of this country leaving the Euro zone should also be considered. The escalation of problems referred to
above, may lead to the weakening of the Polish currency, drops in the stock exchange, or the increase in profitability of
treasury bonds. Nevertheless, upon writing this report, it is difficult to assess the probability of different scenarios which may
have an impact on the development of political situation.
3.8. Risk of significant foreign exchange fluctuations
Foreign exchange fluctuations have an influence on the Company’s operating activities and in particular the rent payments
(which in most cases are denominated in EUR) and payments made for medical equipment (which are usually also
denominated in EUR). Rent payments are made in PLN at the exchange rate of the National Bank of Poland. If there are
significant deviations of the actual exchange rate from the assumed level, the Issuer may record a gain or loss on foreign
exchange differences. The Company constantly monitors the changes in foreign exchange rates. The Company does not
hedge foreign exchange risk by using derivative financial instruments. In order to minimise the influence of foreign exchange
rates fluctuations on the financial results of the Company, the Management Board monitors the market rental rates, taking
into account the current foreign exchange rates on an on-going basis.
It should be emphasised that in accordance with a majority of forecasts, quite a considerable variability of PLN exchange rate
is expected in connection with the situation beyond the eastern border of Poland and in Greece. In the long terms bases, it is
still expected that the value of the Polish currency shall increase. It should be also noted that in recent weeks, the risk of a
speculative attack on the Polish currency has increased. It is related to the fact that in the current situation in Poland we deal
with very high real interest rates.
3.9. Risk of significant changes in interest rates
The Company finances its activities using external funds, including credits and loans, as well as purchases medical equipment
under finance lease. The finance charges related to servicing external financing are directly dependent on the level of the
WIBOR rate. If the level of interest rates changes, the Company’s financial results may be different than those assumed. At
the end of 2012, the Monetary Policy Council started a cycle of interest rates’ reductions. At this point, it is expected that
interest rates may move up at the end of 2015 at the earliest. However, reductions in the upcoming months cannot be
excluded. Analysts draw such conclusions based on the latest inflation projections prepared by NBP and statements of the
members of the Monetary Policy Council. The Company manages financial liabilities in a way allowing minimisation of
financial costs related to debt service. Owing to years of cooperation with financial institutions, it negotiates advantageous
interest rates. The Management Board constantly analyses the situation in the banking market and if there are new
favourable opportunities for the Company to obtain external funding it renegotiates the loan agreements in order to improve
their conditions. The risk of changes in interest rate is also reduced by investing spare cash held in bank accounts in the form
of term deposits. The Company does not hedge the interest rate risk by using derivative financial instruments.
3.10. Credit risk
The Company is not exposed to too much risk due to concentration of credit sales. The Company enters into transactions
only with reputable companies with sound credit standing. All the customers who wish to trade on credit terms undergo
verification procedures. Furthermore, owing to ongoing monitoring of receivables, the Company's exposure to the risk of bad
debts is not significant. Sales transactions with individuals are settled in cash or after prepayment. With respect to the
Company's other financial assets such as cash and cash equivalents, available-for-sale financial assets, the Company's credit
risk arises as a result of the inability to make payment by the other party to the agreement.
19
In relation to financial liabilities credit risk may arise from the Company's inability to comply with the terms and conditions
stipulated by credit agreements. Basically it means non-fulfilment in particular areas of the contractual debt ratios, which
may lead to an increase in margin, request for additional security, request for presenting corrective program or even in
extreme case termination of the credit agreement by the Bank. In order to minimise the risk, the Company constantly
monitors the indicators and in case of any deterioration of the situation it enters into negotiations with creditors.
There are no significant concentration of credit risk in the Company's operations.
3.11. Liquidity risk
The Company's liquidity risk management assumes current control and planning of cash flows in the Company in order to
ensure appropriate level of cash flow necessary to finance the Company's current operations.
The Issuer monitors the risk of funds shortage using periodic liquidity planning tool. This tool takes into account the due
dates/maturity of both investments and financial assets (e.g. accounts receivable, other financial assets) and expected cash
flows from operating activities. Cash flow surpluses are invested in bank deposits, taking into account the corresponding
maturity, so that they have no negative impact on the Company's current liquidity. The Issuer aims at maintaining a balance
between continuity and flexibility of financing by using various sources of financing such as overdrafts, bank loans, finance
leases and lease agreements with option to purchase.
3.12. Risk of changes in legal regulations and their interpretations
The changes introduced or planned to be introduced to provisions of law and in particular to economic, tax and labour law,
may constitute a risk factor causing negative consequences for the Company. Similar consequences result from the changes
in interpretation of binding laws, in particular in relation to tax law regulations. The Company’s activity is also indirectly
influenced by regulations concerning the public health care sector, including regulations that stipulate the methods and rules
of its financing, as well as define the scope in which commercial patients may be admitted to public sector facilities.
Depending on the nature of changes, they may have either positive or negative influence on the activity of the Issuer and
other entities in the sector.
3.13. Risk of more intense domestic and foreign competition in the market
Investors recognize the attractiveness of the Polish market of private medical services, as well as good perspectives of further
development in this sector. The aforementioned may result in an increase in competition of Polish and foreign enterprises
which may be observed based on the latest transactions on the Polish market of medical services. There is a risk that as a
result of a more intense competition, the Company’s revenues and profits may decrease. However, ENEL-MED has been
operating in the competitive environment for many years and has been maintaining its sales dynamics all the time.
20
4. Basic economic and financial ratios. The Company's development prospects
4. BASIC ECONOMIC AND FINANCIAL RATIOS.
THE COMPANY’S DEVELOPMENT PROSPECTS
4.1. Selected financial data
The year 2014 was a very good year for the Company both in terms of revenue growth and improved efficiency. Considerable
increases in sales occurred in the field of Clinics (sales of prepaid medical care packages, services provided to individual
clients and insurance companies).
Activity area
Clinics *
Diagnostics
Sales 2013
Sales 2014
Growth
158,836
182,984
15%
31,325
15,673
-50%
* Medical and dental clinics
Drop in revenues from Diagnostics resulted from the fact that an organised part of the enterprise composed of 7 diagnostic
facilities was contributed to Centrum Medyczne Diagnostyka sp. z o.o. by the Company in 2014. Subsequently, 100% of
shares in Centrum Medyczne Diagnostyka sp. z o.o. was contributed to Centrum Medyczne Diagnostyka Obrazowa sp. z o.o.
by the Company. With regard to the sale by the Issuer's subsidiary under the business name Centrum Medyczne Diagnostyka
Obrazowa sp. z o.o. of 100% of shares in Centrum Medyczne Diagnostyka sp. z o.o. financial means were obtained that will
allow for implementation of the Company's long-term strategy including new investments (both the modernisation of the
existing facilities and establishment of new ones). In the second half of 2014 Zacisze Hospital in Warsaw was equipped with
brand new magnetic resonance imaging. For 2015, further investments are planned within the Diagnostics and Clinic
divisions.
It should be noted that despite the decrease in sales under diagnostics representing approx. 7.5% in the total Company's sale,
the total sales from all divisions increased by 5% per year compared to 2013.
The increase in revenues from clinics is mainly the result of intensive sales of prepaid medical care packages, the
development of cooperation with insurance companies and high quality of services provided in our facilities which have also
been recognised by individual patients.
4.2. Financial factors and events influencing achieved financial results
In order to achieve long-term development strategy, in 2014, the Issuer's subsidiary under the business name of Centrum
Medyczne Diagnostyka Obrazowa sp. z o. o. sold 100% of shares in Centrum Medyczne Diagnostyka sp. z o. o. (the company
to which the Issuer contributed the organised part of the enterprise intended for carrying out business activity in the scope of
diagnostics). Financial means obtained as a result of this transaction will make it possible to finance new investments.
In May 2014 a new multi-profile facility located in Promenada Shopping Mall in Warsaw was opened. In the second half of
the year new magnetic resonance scanners were purchased for the Zacisze Hospital in Warsaw and in November/December
2014 ESTELL a new clinic - ESTELL aesthetic medicine centre commenced operation.
In 2014 the Company focused all its efforts on increasing sales (both in terms of subscribers and individual clients) and
further improvement of cost-efficiency. Better use of existing infrastructure combined with significant cost savings resulted in
a significant improvement the Company's financial result.
21
4. Basic economic and financial ratios. The Company's development prospects
4.3. Prospects of business activity development.
The Company’s development strategy for the years 2014-2016
In the fourth quarter of 2013 the Management Board of Centrum Medyczne ENEL-MED S.A. adopted a strategy for the
Company's development for the years 2014-2016. The strategy announced put a strong emphasis on expanding the scale of
operations into new areas, as well as increasing the efficiency of the offered services.
The Company's strategy assumes an increase in effectiveness of sales of prepaid medical care packages, including the
development of business activities in new markets and - as the potential is filled in - the development of clinics in selected
locations. In 2014 the Company chose location for a multi-profile clinic in Katowice that is planned to be opened in 2015. In
the second and third quarter of 2015 ENEL-MED shall launch the second medical facility in Wrocław. Pursuant to the adopted
strategy, the Management Board of ENEL-MED announced also establishment of two new highly specialist profiled facilities
in Warsaw, as well as an increase of share of dental services in the portfolio through gradual increase in the number of dental
surgeries. Launching specialist profiled facilities is aimed at the development of commercial services for individual clients in
selected specialities such as orthopaedics with rehabilitation, aesthetic medicine, etc. The first facility - aesthetic medicine
centre under the business name of ESTELL was launched in 2014. Another - sports medicine centre, located at Legia
Warszawa Football Club is planned to be opened in 2015. The expected return on investments of commercial facilities
located in Warsaw is two years.
An equally important element in the Strategy includes activities in the area of long-term medical care for the Elderly. This
project will be implemented by Bonus Vitae sp. z o.o., in which 40 % of shares are held by Enelbud sp. z o.o. (the Issuer's
subsidiary). The first elderly home care is going to be launch in Głuchołazy (the Opolskie Voivodeship), the opening is planned
for the second quarter of 2016.
Dental services play a significant role in the activities of ENEL-MED. It should be emphasised that the Company started its
business activities in 1993 from the provision of dental services at the highest level. In the subsequent years, this area is
planned to be intensively developed by increasing the number of dental surgeries and different than before positioning of
dental services. The Company intends to obtain a significant increase in sales of commercial services in this area and win the
leading position in the Warsaw market.
The Company continues efforts to increase sales of commercial services which have already been noticed in the second half
of 2014. Wishing to achieve better financial performance in hospitals, the Company has put a lot of effort into using the
potential of ENEL-MED in obtaining patients from the inside and outside by the website corresponding to the patient's needs.
Additionally, variable cost optimisation was made.
Completion of investments planned by ENEL-MED requires the investment outlays in the amount of PLN 50 million. The
Company intends to use own resources of the Capital Group, including proceeds from the sale of 100% of shares in Centrum
Medyczne Diagnostyka sp. z o. o. (the company to which the Issuer contributed the organised part of the enterprise intended
for carrying out business activity in the scope of diagnostics) and external sources of funding. All new investments will be
carried out with the maintenance of the financial security of the Company.
Implementation of the approved Strategy shall lead to dynamic development and market position strengthening of Centrum
Medyczne ENEL-MED in subsequent years.
22
5. Additional information
5. ADDITIONAL INFORMATION
5.1. Information on organisational or capital relationships of Centrum Medyczne ENEL-MED
S.A. with other entities and presentation of domestic and foreign investments thereof
Centrum Medyczne ENEL-MED S.A. holds 80 shares making up 80% of the share capital of Enelbud Sp. z o.o. and Enelbud sp. z
o.o. holds 40 shares making up 40% of the share capital of Bonus Vitae sp. z o. o.
Additionally, the Issuer holds 510,000 shares making up 100% of the share capital of Centrum Medyczne Diagnostyka
Obrazowa Sp. z o.o.
On 28 February 2014, the Extraordinary Meeting of Shareholders of Centrum Medyczne Diagnostyka sp. z o. o. (the company
in which Centrum Medyczne ENEL-MED S.A.) holds 100% of share in the share capital) adopted a resolution on increasing the
share capital from the amount of PLN 5,000.00 to the amount of PLN 500,000.00 that is by the amount of PLN 495,000.00, by
creating 4,950 new shares with the nominal value of PLN 100.00 each. All newly established shares were taken up by
Centrum Medyczne ENEL-MED S.A. on 28 February 2014. These shares were paid for in full by in-kind contribution in the
form of a set of tangible and intangible assets separated organisationally and financially which are used to carry out business
activity in the field of diagnostic imaging at the following facilities: Bielany Diagnostic Centre in Warsaw, Magnetic Resonance
Laboratory in Konin, Magnetic Resonance Laboratory in Mielec, Computed Tomography Laboratory in Poznań, Magnetic
Resonance Laboratory in Łomża, Computed Tomography Laboratory in Wołomin and Diagnostic Laboratory in Lublin,
constituting an organised part of the enterprise with capacity of operating as an independent enterprise. The
aforementioned part of the enterprise was contributed to Centrum Medyczne Diagnostyka sp. z o.o. as of 30 April 2014.
Subsequently, on 29 May 2014 the Extraordinary Meeting of Shareholders of Centrum Medyczne Diagnostyka sp. z o. o.
adopted a resolution on increasing the share capital of this company from the amount of PLN 5,000.00 to the amount of PLN
50,995,000.00 by issuing 509,950 new shares with the nominal value of PLN 100.00 each. All the newly established shares
were taken up by the Company on 29 May 2014 and paid for in full by in-kind contribution in a form of 5,000.00 shares in
Centrum Medyczne Diagnostyka Sp. z o. o. with the nominal value of PLN 100.00 each, of total nominal value of PLN
500,000.00. The contributed shares constituted 100% of shares in the share capital of Centrum Medyczne Diagnostyka Sp. z
o.o. As a result of the described changes Centrum Medyczne Diagnostyka Obrazowa Sp. z o.o. acquired 100% of shares in the
share capital of Centrum Medyczne Diagnostyka Sp. z o.o. In connection with the conclusion of a purchase-sale agreement on
30 June 2014 by Centrum Medyczne Diagnostyka Obrazowa sp. z o.o. for the benefit of LUX MED Diagnostyka sp. z o. o., for
the sale of 100% of shares in the share capital of Centrum Medyczne Diagnostyka sp. z o.o., the Issuer lost control over
Centrum Medyczne Diagnostyka sp. z o. o.
The Company concluded also an agreement with GE Medical Systems Polska sp. z o. o. for the purchase of 4 magnetic
resonance imaging scanners and twelve ultrasound cameras, referred to in point 2.10.
With the exception of the transaction specified above, there were no other significant domestic and foreign transaction in the financial
year 2014.
5.2. Information on significant transactions concluded by the Company or its subsidiaries with
related parties pursuant to non-arm’s length conditions
Neither the Company nor its subsidiaries concluded transactions with related parties pursuant to non-arm’s length
conditions.
23
5.3. Information on concluded and terminated credit and loans agreements
Type of
credit/loan
(Business) name
Millennium
Bank SA
Millennium
Bank SA
Credit Agricole
Bank Polska S.A.
Amount of credit
loan acc. to the
agreement
annex to the
agreement
as of 2013
- corporate
mortgage
annex tocredit
the
agreement
as of 2013
- global
overdraft
annex to the
multi-purpose
credit line
agreement
Currency
10,400,000.00
15,000,000.00
3,000,000.00
Interest rate
conditions
WIBOR1M+ 0.9%
margin
PLN
WIBOR1M+ 0.9%
margin
PLN
WIBOR1M+ 0.55%
margin
PLN
Repayment
Date
24 May 2017
overdraft
limit granted
- to 24 April 2015
overdraft
limit granted
- to 9 June
2014
* under the same annex the Bank granted the Company a limit in the amount of 20,000,000.00 for the period from 25 March 2013 to 24 March 2014 and
17,000,000.00 for the period from 25 March 2014 to 10 August 2014. Starting from 11 August 2014 the credit referred to above is binding. Other terms
such as the amount of credit and interest rate have remained unchanged.
5.4. Information on granted loans with particular focus on the loans granted to related parties
In 2014, Centrum Medyczne ENEL-MED S.A. granted the following loans:
(Business) name
Centrum Medyczne
Diagnostyka Obrazowa
sp. z o.o. (the Issuer's
subsidiary)
Centrum Medyczne
Diagnostyka sp. z o.o. (the
Issuer's subsidiary)*
Amount of
Loan
Type
Currency
350,000.00
loan agreement
PLN
20,000.00
loan agreement
PLN
Interest rate
conditions
4% per year
4% per year
Repayment
Date
31
December
2014
30 June 2014
* the company is no longer the Issuer's subsidiary. On 30 June 2014 Centrum Medyczne Diagnostyka Obrazowa sp. z o o. (the Issuer's subsidiary)
sold 100% of shares in Centrum Medyczne Diagnostyka sp. z o.o.
24
5.5. Information on warranties and guarantees granted and received
Specification
bank guarantee
issued by
Bank Millennium S.A.
Title
surety/guarantee for
Union Investment Real Estate
GmbH
bank guarantee issued by
Kite Duo Sp. z o.o.
bank guarantee issued by
GSSM Warsaw Sp z o.o.
performance bond
performance bond
performance bond
Currency
31
December
2014
EUR *
145,837
EUR *
422,601
EUR *
429,036
* calculated according to the average exchange rate of NBP as at 31 December 2014
5.6. Explanation of differences between financial results published in the annual report and
previously announced annual forecasts for a given year
The Company did not publish any financial forecasts for the year 2014.
5.7. Evaluation of financial resources management
Debt ratios are monitored by the Company on an on-going basis. As a result of debt reduction, they significantly improved in
the last year. Total debt ratio dropped at the end of 2014 reaching a safe level of 0.36. Liabilities are paid on time. Collection
of receivables was also significantly improved. Receivables turnover in days equals 19 days.
5.8. Evaluation of potential implementation of investment projects
The Issuer intends to use the funds obtained by the Issuer's Capital Group from the sale transaction of 100% of shares in the
share capital of the Issuer's subsidiary - Centrum Medyczne Diagnostyka sp. z o.o., composed of 7 diagnostic facilities, for
launching new medical facilities.
In 2015 the Company plans to open sports medicine centre at the sports club Legia Warszawa. Furthermore, the plans cover
opening of multi-profile and diagnostic facilities in Katowice and Cracow. Additionally, a second medical facility in Wrocław is
planned to be opened. The Issuer intends to finance all these investment from the Capital Group's own funds.
5.9. Evaluation of factors and non-standard events influencing the result of business activity
In 2014, the contract with the National Health Fund concerning hospital treatment was decreased by 8% as compared to
2013.
Drop in revenues caused by the sale of 100% of shares in the share capital of Centrum Medyczne Diagnostyka sp. z o.o
composed of 7 diagnostic facilities resulted in decrease in sales from the diagnostic imaging. Simultaneously, in 2014 the
revenue from sale of prepaid medical care packages increased by 20% compared to the previous year which meant that in
2014 the Company reached higher total sales by 5% compared to 2013. It was accomplished owing to the development of
other operating sectors.
25
5.10. Description of external and internal factors material for the development of the
enterprise and description of the development prospects of the Company’s business
activity
Description of factors material for the development of the enterprise is presented in point 3 of this report which specifies risk
factors and threats to the Company. Additionally, the Issuer’s development prospects are presented in point 4.3.
5.11. Changes in the basic management principles of the Company and its capital group
Change of the structure in the division of the Prepaid Medical Care Packages and Health Insurance, introduced in 2013, gave
results already in 2014, which resulted in a 20% increase in sales. Moreover, the model of management of the costs from
prepaid packages strictly connected with the number of patients and the monthly amount of lump sum paid by them was
improved. It contributes to optimisation of the quality for the patient and costs for the Company. A distinction of FFS patients
(who pays for the service provided) and subscribers was made and thus related sources of revenue were distinguished. A
body responsible for management of the aesthetic medicine centre was established within the structure of the Company.
In the presented period, optimisation of the structure of the purchase department was made by synergy of the purchase and
investment departments. A Purchase and Investment Director was appointed for the newly established Department.
Despite the fact that an organised part of the enterprise held to provide diagnostic services was contributed to Centrum
Medyczne Diagnostyka sp. z o.o., ENEL-MED did not stop its activity in this field, on the contrary, it continues to develop
diagnostic imagining in the scope of magnetic resonance tests which is still considered by the Company as profitable
business. In the third quarter of 2014, four magnetic resonance scanners and twelve ultrasound cameras were bought from
GE Medical Systems Polska sp. z o.o and the purchase price amounted to PLN 17,618,900.00, thus the diagnostic imaging will
continue to grow. In the middle of the year Diagnostic and Hospital Division was split up into two divisions. Former Sales
Manager - Tomasz Kupczyk was appointed a Diagnostic Imaging Director and Aleksandra Rzepecka became a Director General
for Hospitals. These divisions influenced an increase in sales of commercial services in hospitals in the second half of 2014 by
32% compared to the first half of 2014.
In 2014, the area of e-commerce was developed in the Marketing and Communication Departments and an on-line store was
opened which the Company plans to developed in 2015.
Subcontractors' management model was optimised (the Issuer cooperates with over 1.300 partner facilities) which reduced
the average cost per patient incurred by the Company in co-operating facilities.
5.12. Agreements concluded between the Company and the managing persons that stipulate
compensation for the resignation or loss of office without important reasons, or if their
deposition follows the Company's merger by acquisition
The Company did not enter into any agreements with managing persons providing for compensation in the case of their
resignation or termination of employment on a particular position.
26
5.13. Value of remuneration, rewards or benefits for persons managing and supervising the Company
Remuneration of Members of the Issuer's Management Board in Centrum Medyczne ENEL-MED S.A. (in PLN)
First name and surname
Gross remuneration payable for 2014
Gross remuneration paid for 2014
Adam Rozwadowski
540,000.00
525,000.00
Jacek Rozwadowski
36,000.00
36,000.00
TOTAL
384,000.00*
377,000.00*
960,000.00
938,000.00
* for the position of CEO held by Jacek Rozwadowski Remuneration premiums amount to PLN 33,350.00. The total amount of remuneration
payable with remuneration premiums amounts to PLN 993,350.00.
Remuneration of Members of the Management Board in the Issuer's subsidiaries (in PLN)
Centrum Medyczne Diagnostyka Obrazowa sp. z o.o.
Gross remuneration payable
for 2014
Adam Rozwadowski
Gross remuneration paid for
2014
120,000.00
Jacek Rozwadowski
100,000.00
60,000.00
TOTAL
50,000.00
180,000.00
150,000.00
Remuneration of Members of the Supervisory Board in Centrum Medyczne ENEL-MED S.A. (in PLN)
Gross remuneration payable
for 2014
Anna Rozwadowska
Gross remuneration paid
for 2014
240,000.00
260,000.00
Adam Ciuhak
30,000.00
32,500.00
Janusz Jakubowski
30,000.00
32,500.00
Anna Piszcz
30,000.00
32,500.00
Zbigniew Okoński
30,000.00
32,500.00
TOTAL
360,000.00
390,000.00
Remuneration of Members of the Supervisory Board in the Issuer's subsidiaries (in PLN)
Enelbud sp. z o.o.
First name and
surname
Janusz
Jakubowski
Gross remuneration 2014
108,000.00
27
5.14. Information on total number and nominal value of all shares and shares in the related
parties held by members of the management and supervisory boards of the Company
Shares held in Centrum Medyczne ENEL-MED S.A. by the managing and supervising persons as at 31 December 2014 based
on information provided by the persons obliged is presented in the table below.
Number of shares in Centrum
Medyczne ENEL-MED. S.A.
Adam Stanisław Rozwadowski
Nominal value of all
shares (PLN)
7.124.000
7.124.000
Jacek Jakub Rozwadowski
994.376
994.376
Anna Maria Rozwadowska
7.123.950
7.123.950
According to the information available to the Company in 2014 Jacek Jakub Rozwadowski, the Deputy President of the
Management Board increased the number of the Issuer's shares held, referred to in point 1.3 of this report.
Shares held in Enelbud sp. z o. o. - in the subsidiary of Centrum Medyczne ENEL-MED S.A.
- by the managing and supervising persons as at 31 December 2014 is presented in the table below.
Number of shares in Enelbud Sp. z o. o.
Janusz Jakubowski
Nominal value of all shares (PLN)
20
10.000
5.15. Information on agreements known to the Company that might in the future result in
changes of proportions of shares held by existing shareholders and bondholders
The Company is not aware of any agreements concluded in 2014 that might in the future result in changes of
proportions of the shares held.
5.16. Information on the system of control over employee shares
There is no employee share plan functioning in the Company
5.17. Information on proceedings pending before a court, competent arbitration authority or
public administration body concerning liabilities and receivables
The Company did not take part in any proceedings held before any court, arbitration body or public administration body with
regard to the Company’s liabilities or receivables in the amount equal to at least 10% of equity.
The total amount of claims in all proceedings pending with reference to the liabilities did not exceed 10% of the
Issuer’s equity.
The total amount of claims in all proceedings pending with reference to the Company’s receivables did not exceed 10% of the Issuer’s
equity as well.
5.18. Objectives and methods of financial risk management
The Company is exposed to the following types of financial risk:
1. Interest rate risk.
2. Foreign exchange risk.
3. Credit risk.
28
The objective of risk management is to minimise its influence on financial results of the Company and to ensure the financial
liquidity of the Issuer.
The Company manages the financial liabilities in a way allowing minimisation of financial costs related to debt service. Owing
to years of cooperation with financial institutions, it negotiates advantageous interest rates. Last year, the Company started
cooperation with Bank Millennium that being one of the main clients in the scope of prepaid packages became also the main
partner financing the Company’s activities.
The Management Board pays significant attention to ensuring cash flows for the Issuer which allow payment of financial
liabilities in accordance with the signed agreements.
The Company is exposed to the risk of foreign exchange rates fluctuation on account of costs of space leased. The foreign
exchange risk arises directly from the rates for lease determined in foreign currency converted into PLN. In order to minimise
the influence of foreign exchange rates fluctuations on the financial results of the Company, the Management Board
monitors the market rental rates, taking into account the current foreign exchange rates on an on-going basis. The Company
expects that it is more probable that the Polish currency will strengthen in 2015 than depreciate and therefore the influence
of the foreign exchange risk should be advantageous to the Company in the current year.
The Issuer is also theoretically exposed to the risk connected with possible withdrawal of financial institutions from financing
the Company's activities. To mitigate the risk, the Company makes every effort to improve its effectiveness and thus its
financial results, which results in maintaining appropriate bank ratings.
The Company pays also considerable attention to establishing partner and long-term relations with financial partners by
fulfilling its obligations and ensuring the transparency of provided financial information.
In addition, the Company applies also diversification of both financing forms (credits, leases, financing by suppliers) and
financing institutions, therefore is not dependent on one financing partner.
Taking the above into consideration, the Management Board considers this risk as not very probable.
29
6. Entity authorised to audit financial statements
6. ENTITY AUTHORISED TO AUDIT FINANCIAL STATEMENTS
On 27 November 2014 the Company concluded an agreement with PKF Consult sp. z o. o. for audit of the Company's
separate financial statements as at 31 December 2014 in accordance with IAS/IFRS and the consolidated financial statements
of the Capital Group prepared as at 31 December 2014 pursuant to IAS/IFRS. The parties agreed that the time-limit for audit
performance was from the date of signing the agreement to 6 March 2015.
Moreover, on 30 July 2014 the Company concluded an agreement with PKF Consult sp. z o. o. for audit of the Company's
separate financial statements and the consolidated financial statements of the Capital Group prepared as at 30 June 2014
pursuant to IAS/IFRS. PKF Consult Sp. z o. o. is a company entered into the list of entities authorised to audit financial
statements under No. 477.
The table below shows the remuneration of the entity entitled to audit the financial statements:
2014
PLN (net)
Remuneration of PKF Consult Sp. z o.o., including:
Audit of the annual separate financial statements
29,000
audit of the annual consolidated financial statements
12,000
Other assurance services, including the review of the financial statements (separate
and consolidated)
26,000
Advisory services
2013
PLN (net)
Remuneration of PKF Consult Sp. z o.o., including:
Audit of the annual financial statements
29,000
Other assurance services, including the review of the financial statements
17,000
Advisory services
30
7. Corporate governance
7. CORPORATE GOVERNANCE
7.1. Corporate governance principles
Corporate governance principles that the Company follows are included in the “Code of Best Practice for WSE Listed
Companies” (hereinafter referred to as the Code of Best Practice). The Code of Best Practice is available on the website of the
Warsaw Stock Exchange in Warsawwww.corp-gov.gpw.pl devoted to issues of corporate governance.
7.2. Information on exceptions in application of corporate governance principles
In 2014, the Company applied and complied with all of the rules set forth in the “Code of Best Practices for WSE Listed
Companies", excluding the following rules:
- The Company did not broadcast the General Meetings of Shareholders with the use of the Internet. The Company pursues
a transparent and effective information policy, runs website based on the model investor relations service, uses modern
methods of Internet communication, yet in 2014, it did not broadcast the General Meeting with the use of the Internet.
Bearing in mind the shareholding structure of the Company, the General Meeting was attended by a significant number of
shareholders representing more than 70% of the total number of votes and therefore the Company did not broadcast the
General Meeting and did not publish it on its website. Moreover, the General Meeting was held in a place that enabled the
participation of the biggest possible number of shareholders that is in Warsaw, at the Company’s registered office.
- Shareholders’ questions on issues on the agenda submitted before and during the General Meeting were not published on
the Company's website. The Company takes the view that since a notary public took the minutes of the General Meeting, it
was not necessary to publish such records. All the resolutions adopted by the General Meeting both Ordinary and
Extraordinary were published in the ESPI system and on the Company’s website.
- The company did not enable its shareholders to exercise the voting right during the General Meeting either in person or
through a plenipotentiary, outside the venue of the General Meeting, using electronic communication means. Application of
the aforementioned rule was not possible in 2014 because the Company’s Articles of Association do not include relevant
regulations in this scope (Art. 406(5) § 2 of the Code of Commercial Partnerships and Companies). Thus, the change of this
condition would require the adoption of a resolution on the amendment of the Articles by the shareholders of the Company
and the entry of such an amendment into the register of entrepreneurs of the National Court Register. Regardless of the
above, the Company enables its shareholders to exercise the voting rights either in person or through a plenipotentiary. It is
important that the General Meeting of Shareholders was held at the Company's registered office in Warsaw, which made it
easy for the shareholders or their plenipotentiaries to be present at the venue of the General Meeting. Shareholders who
were not present at the General Meeting of Shareholders were informed about essential points of the course of the General
Meeting of Shareholders immediately after its closing. It takes place because the Company fulfils the reporting obligations
imposed by the provisions of law and not later than within 24 hours of closing the General Meeting of Shareholders, it
provides - in the form of current reports - the information about the content of adopted resolutions, results of voting and the
information about possible objections - analogous information is also published on the Company's website, as it was in 2014.
It should be also emphasised that the application of this rule poses a threat of technical and legal nature due to little
experience in the market in the scope of organisation of General Meetings of Shareholders with the use of electronic
communication means. Yet, the Company does not exclude the possibility of applying this rule in the future.
- In 2014, the Company operated a corporate website but it did not publish the records of the General Meeting in audio or
video format. The aforementioned rule was not applied by the Company as - according to the experience - there is no need of
recording the General Meeting of Shareholders in audio or video format. Pursuant to the assessment of the Company,
fulfilment of the reporting obligations imposed by the applicable laws by providing current reports including information on
the content of adopted resolutions, results of voting and information about possible objections and publishing
31
such information on the Company's website, enables the investors to get informed about the essential points of the course of
the General Meeting of Shareholders. Furthermore, the decision of the Company about the non-fulfilment of this rule
secures the Company against possible claims filed by the shareholders who may not give their consent to the publication of
their image or publishing of their statements. However, the Company does not exclude the application of this rule in the
future.
- The Company did not provide the shareholders with the possibility of participating in the General Meeting with the use of
electronic communication means in a form of the real-life broadcast of General Meeting and real-time bilateral
communication where shareholders may take the floor during a General Meeting from a location other than the General
Meeting. The application of the aforementioned rule was not possible in 2014 because the Company’s Articles of Association
do not include relevant regulations in this scope. Pursuant to the provisions of Article 406 (5) §1 of the Code of Commercial
Partnerships and Companies, the real-life broadcast of General Meetings and real-time bilateral communication where
shareholders may take the floor during a General Meeting from a location other than the General Meeting are possible if the
Company’s Articles of Association include the regulation which permit it. Thus, the change of such a condition would require
the adoption of a resolution on the amendment of the Articles by the shareholders of the Company and the entry of such an
amendment into the register of entrepreneurs of the National Court Register. Regardless of the above, it should be noted
that the Company enables its shareholders to participate in the General Meeting of Shareholders either in person or through
a plenipotentiary. The General Meeting of Shareholders is held at the Company's registered office in Warsaw, which makes it
easy for the shareholders or their plenipotentiaries to be present at the venue of the General Meeting and the shareholders
who were not present at the General Meeting of Shareholders were immediately informed about the essential points of the
course of the General Meeting of Shareholders. It takes place because the Company fulfils the reporting obligations imposed
by the provisions of law and not later than within 24 hours of closing the General Meeting of Shareholders, it provides - in the
form of current reports - the information about the content of adopted resolutions, results of voting and the information
about possible objections - analogous information is published on the Company website. Thus, pursuant to the assessment of
the Management Board, the rules arising from the provisions of law, the Company’s Articles of Association and the
Regulations of the General Meeting of Centrum Medyczne ENEL-MED S.A. are sufficient to enable the shareholders to
participate in the General Meeting either in person or through a plenipotentiary and to exercise their voting rights in this
scope. Therefore, additional and significant costs to be incurred by the Company in order to ensure the real-time broadcast
of General Meetings and real-time bilateral communication seems to be unjustified. Additionally, it should be noted that the
application of this rule poses a threat of technical and legal nature due to little experience in the market in this scope. Yet,
the Company does not exclude the possibility of applying this rule in the future.
7.3. Description of key features of internal control system and risk management system
applied by the Company with respect to the process of drawing up financial statements
The Issuer's Management Board is responsible for the internal control system in the Company and its effectiveness in the
process of drawing up financial statements and periodic reports prepared and published pursuant to the Regulation of the
Minister of Finance dated 19 February 2009, on the current and periodic information published by the issuers of securities.
During the year, the Company’s Management Board analyses financial results on an on-going basis by comparing them with
the adopted budget, using the management reporting applied in the Company developed on the basis of the Company’s
accounting policy adopted by the Company and taking into account the format and level of details of financial data presented
in periodic financial statements of the Issuer. Preparation of financial statements, periodic financial statements and reports
and current management reporting of the Company is the responsibility of the Financial Department of the Company which
is currently managed by the Chief Financial Officer. Financial statements and periodic reports of the Company are drawn up
by the Chief Accountant based on the financial data included in periodic management reports after their approval by the
Chief Financial Officer, taking into account other supplementary data provided by certain employees from other
departments. After closing the books for each month, the medium and top management of the Company’s Financial
Department led by the Chief Financial Officer jointly analyses the Company’s financial results in comparison with
assumptions,
32
taking into account business sectors. Identified errors are adjusted on an on-going basis in account books of the Company
and in the reporting system in accordance with the adopted accounting policy. The process of drawing up financial
statements and periodic reports begins after the Chief Financial Officer approves the results for the closed period.
In 2014, the Company introduced financial management system PROPHIX software of CPM class (Company Performance
Management). As a result, the annual budgeting process, forecasting, detailed analysis of results during the financial year
were significantly improved.
Interim and annual financial statements are verified by an independent auditor. The results of the annual audit are presented
by the auditor during the meetings summarising the audit and to the Supervisory Board fulfilling the tasks of the Audit
Committee. After the auditor completes the audit, financial statements and periodic reports are submitted to members of
the Company’s Supervisory Board. Before the Management Board and Supervisory Board approve periodic financial
statements and reports for publishing, the meeting of the Supervisory Board fulfilling the tasks of the Audit Committee is
held. During the meeting, the Chief Financial Officer presents material aspects of the annual financial statements - in
particular the possible changes in accounting principles, major estimates and accounting judgements, material disclosures
and business transactions. As a body fulfilling the tasks of the Audit Committee, the Supervisory Board carries out the reviews
of periodic financial statements and reports taking into account the information presented by the Company’s Management
Board and the independent auditor - approval of the financial statements and reports by the Supervisory Board depends on
the results of this review.
The statutory auditor is selected by the Company’s Supervisory Board in accordance with the Articles of Association. Material
issues related to periodic statements and reports that are not verified by the auditor are consulted with the auditor in order
to avoid potential material adjustments in subsequent reports. The Company maintains its account books in the Exact
system. The system is password-protected against unauthorised access. A carefully selected group of employees participate
in the process of drawing up the financial statements; other persons do not have the access to the data providing the basis
for their preparation. Account books, accounting documents and the documentation of the bookkeeping methods, as well as
approved financial statements of the Company are stored in accordance with the provisions of the Accounting Act.
7.4. Significant share packages
The table below presents Shareholders who held significant share packages as at 31 December 2014.
Adam Stanisław Rozwadowski*
7.124.000
30.23
Numbe
r of
votes
7.124.000
Anna Maria Rozwadowska*
7.123.950
30.23
7.123.950
30.23
Generali Open Pension Fund
2.377.000
10.09
2.377.000
10.09
PZU ,,Złota Jesień” Open
Pension Fund
1.680.000
7.13
1.680.000
7.13
Shareholder
Number of shares
% of capital
% of votes
30.23
* presumption of an agreement exists between Anna Maria Rozwadowska, Jacek Jakub Rozwadowski and Bartosz Adam Rozwadowski (they hold 16,214,976
shares collectively, authorising to cast 16,214,976 votes at the General Meeting of Shareholders).
7.5. Special control rights
The shares of the Company are bearer ordinary shares listed on the Warsaw Stock Exchange. No shares of the Company are
preferred, each share gives the right to one vote at the General Meeting of Shareholders.
33
7.6. Limitation of voting rights from existing shares
The Articles of Association of Centrum Medyczne ENEL-MED S.A. do not impose any limitations on the exercise of the voting
right. Pursuant to Article 413 § 1 with reference to Article 413 § 2 of the Code of Commercial Partnerships and Companies, a
shareholder may not vote in person or through a plenipotentiary on resolutions related to his/her liability with respect to the
Company, on any accounts, including granting the vote of acceptance, release from an obligation towards the Company, or a
dispute between him/her and the Company.
7.7. Limitations with respect to transferring the title to securities
The Articles of Association of Centrum Medyczne ENEL-MED S.A. do not impose any limitations on transferring the title to
securities.
7.8. Principles for appointing and recalling members of the Management Board and their
rights, in particular the right to make decision about issue or buy-out of shares
Pursuant to the Articles of Association of Centrum Medyczne ENEL-MED S.A., the Management Board is composed of 1 (one)
to 5 (five) members appointed by the Supervisory Board. The Supervisory Board may appoint the President or the Deputy
President from among the Management Board members. The Management Board members are appointed by the
Supervisory Board for a three-year common term of office. The Supervisory Board has the right to appoint and recall the
Management Board members.
The powers of the Management Board are described in point 7.11.
Decisions on issue or redemption of the Company's shares are taken by the General Meeting of Shareholders.
7.9. Principles for amending the Company’s Articles of Association
The principles for amending the Company’s Articles of Association arise from the provisions of Articles 430-443 and Articles
455-458 of the Code of Commercial Partnerships and Companies. The Company’s Articles of Association do not introduce
different provisions in this respect provided that, subject to relevant provisions of the law, any change of the objectives of
the Company may be introduced without the obligation to redeem shares from those shareholders who do not consent to
such a change.
7.10. Manner of operation of the Company’s General Meeting and fundamental powers
thereof, shareholders’ rights and the manner of their exercising
The General Meeting of Shareholders is convened and prepared in accordance with the provisions of the Code of Commercial
Partnerships and Companies, the Company’s Articles of Association and the Regulations of the General Meeting of
Shareholders. Both the Articles of Association and the Regulations of the General Meeting of Shareholders are available on
the investor relations website of the Company, at: www.inwestor.enel.pl.
General Meetings can be held as ordinary or extraordinary. An ordinary General Meeting (GM) is convened by the
Management Board not later that within six months of the end of each financial year. The Supervisory Board may convene
the ordinary general meeting if the Management Board does not convene it within the aforementioned deadline. The
Supervisory Board may also convene the extraordinary general meeting if the Management Board considers it as advisable.
Additionally, shareholders representing at least half of the share capital or at least half of total votes have the right to
convene the General Meeting. At the same time, a shareholder or shareholders representing at least one-twentieth of the
share capital may request the Management Board to convene the extraordinary General Meeting and put certain matters on
the agenda.
A shareholder that is a natural person may participate in the General Meeting and exercise their voting right in person or by a
plenipotentiary. A shareholder that is not a natural person may participate in the General Meeting and exercise their voting
right by a person authorised to represent this shareholder or by a plenipotentiary. The proxy to participate in the General
Meeting should be drawn up in writing under pain of nullity, or should be granted in an electronic form and appended to the
minutes of the General Meeting.
The General Meeting is opened by the Chairperson of the Supervisory Board or another person appointed thereby. If such
persons are absent, the General Meeting is opened by the President of the Management Board or a person appointed by the
Management Board, whereupon the Chairperson of the General Meeting is immediately elected from among those entitled
to participate in the General Meeting.
34
The General Meeting may elect the Vote-Counting Commission from among the candidates put up by the participants in the
General Meeting. The duties of the Vote-Counting Commission include the supervision of proper course of each voting as
well as determination and announcement of voting results.
A shareholders or shareholders representing at least one-twentieth of the share capital may request that the specific items
be put on the agenda provided that such a request cannot be made later than twenty-one days before the set date of the
General Meeting.
A shareholder may cast different votes from each share held by a given shareholder.
In general, the voting on resolutions is open. The Chairperson of the General Meeting shall order secret voting on elections
and on motions to recall members of corporate bodies or liquidators or bring them to responsibility, as well as on personal
matters. Furthermore, the Chairperson of the General Meeting shall order secret voting, should at least one shareholder
present or represented at the General Meeting so require. The General Meeting may adopt a resolution on waiving the
secrecy of voting on matters concerning the election of Vote-Counting Commission.
The General Meeting adopts the resolutions provided for in the provisions of the Code of Commercial Partnerships and
Companies and in particular:
- appoints and recalls members of the Supervisory Boards
- sets the manner of remunerating and the amount of remuneration of members of the Supervisory Board, but the manner of
remunerating and the amount of remuneration of the members of the Supervisory Board for independent performance of
certain supervisory activities is set by the Supervisory Board
- decides on issuing convertible or preference bonds
- decides on acquiring own shares in the case determined in Article 362 § 1 point 2 of the Code of Commercial Partnerships and
Companies
- resolves other matters reserved for powers of the General Meeting in accordance with the provisions of the Company’s
Articles of Association and peremptory laws.
7.11. Composition and operation of the Company's management and supervisory authorities
and their committees
The principles governing the operation of the Management Board of Centrum Medyczne ENEL-MED S.A. are set in the
Company’s Articles of Association and the Regulations of the Management Board. Both documents are available on the
Company’s investor relations website, at: www.inwestor.enel.pl.
In accordance with the Company’s Articles of Association, the Management Board consists of one to five members appointed
by the Supervisory Board for a 3-year common term of office.
The composition of the Management Board of Centrum Medyczne ENEL-MED S.A. in 2014 was as follows:
Adam Stanisław Rozwadowski
Jacek Jakub Rozwadowski
Function held
President of the
Management
Deputy
PresidentBoard
of
the Management Board,
CEO of the Company’s Management Board.
In 2014, there were no personal changes in the composition
The Management Board manages the Company’s affairs. The President of the Management Board manages the
work of the Management Board, chairs the meetings of the Management Board and coordinates fulfilment of the
tasks assigned to other Management Board members.
The President of the Management Board is in particular responsible for:
- coordination and management of works of the Management Board
- informing the Management Board members about significant and current affairs and issues related to the Company’s operation
- issuing the orders in the scope stipulated in the Regulations of the Management Board.
35
The meetings of the Management Board are held depending on the needs, however at least once a quarter. The meetings of
the Management Board are convened by the President of the Management Board or at a written request of any
Management Board member. The meeting should be convened within 7 days of filing the request. The notice of the meeting
of the Management Board is given to the Management Board members on the day preceding the meeting at the latest. At
the meeting of the Management Board, before approving the agenda, the Management Board members may file with the
President the request for making additions or amendments to the agenda, including the proposal of a resolution to be
adopted. The meeting of the Management Board may be held without being formally convened if all its members agree to it
no later than on the date of the meeting and confirm it in writing or sign the attendance list. The meetings of the
Management Board shall be opened by the President of the Management Board who manages its work. At the request of any
Management Board member, the meetings of the Management Board may be also attended by non-members of the
Management Board. The resolutions of the Management Board are passed with a majority of votes of the entire
composition. In the event of equality of votes, the President of the Management Board shall have the casting vote. The
resolutions of the Management Board are passed in open voting. The resolutions of the Management Board shall be kept in
the form of a register of resolutions at the registered office of the Company. The meetings of the Management Board shall be
recorded in the minutes.
The composition of the Supervisory Board of Centrum Medyczne ENEL-MED S.A. in 2014 was as follows:
Anna Maria Rozwadowska
Function held
Chairperson of the Supervisory Board
Anna Piszcz
Janusz Jakubowski
Adam Augustyn Ciuhak
Zbigniew Wojciech Okoński
The new members of the Supervisory Board were appointed on 25 May 2012, pursuant to §15 section 4 of the Company’s
Articles of Association, for a common 3-year term of office and their terms of office shall expire on the day of holding the
Ordinary General Meeting approving the financial statements for the year 2014.
In 2014, there were no personal changes in the composition of the Supervisory Board of the Company.
The Board operates based on the Code of Commercial Partnerships and Companies, the Company’s Articles of Association,
resolutions of the General Meeting of Shareholders, the Regulations of the Supervisory Board and the regulations of other
corporate bodies within the scope related to the role, function, acts or omissions of the Supervisory Board and its individual
members, as well as based on other regulations binding at the Company. The Supervisory Board supervises the activities of
the Company in all areas of its operations. The General Meeting of Shareholders is authorised to appoint members of the
Supervisory Board.
The Supervisory Board is composed of 5 (five) to 9 (nine) members, including its Chairman elected by the members of the
Board from among themselves. The General Meeting of Shareholders in each case sets the number of members of the
Supervisory Board. The common term of office of the Supervisory Board equals three years.
The Supervisory Board is in particular responsible for:
- evaluation of financial statements, reports, Management reports and recommendations of the Management Board related
to profit distribution or loss coverage and submission of the reports on the results of such audits to the General Meeting
- expressing the opinions on the Company’s work programmes developed by the Management Board
- approving regulations of the Management Board
- approving financial plan for each year and regulations for managing special purpose funds of the Company
- appointing and recalling members of the Management Board
- setting the principles for remunerating the members of the Management Board, including the President of the Management Board
- selecting a statutory auditor to audit the financial statements of the Company
- expressing consent to the Company's Management Board to establish companies or subsidiaries or to establish or invest the
Company's funds in other companies or business entities
- approving framework principles of cooperation binding the Company with its business partners
- appointing members of the Management Board
- passing regulations of the Supervisory Board.
36
The Supervisory Board fulfils its duties collectively but it may authorise its members to independently carry out individual
supervisory duties, including participating, when necessary, in meetings and works of the Management Board. The members
delegated to independent performance of individual supervisory duties receive separate remuneration. These members are
bound by the non-competition clause which is imposed on members of the Management Board.
The Supervisory Board adopts resolutions by absolute majority of votes of members present provided that all the members
were invited to the meeting. The resolutions may be passed when each member of the Supervisory Board has been correctly
notified in writing of the meeting of the Supervisory Board at least 14 days before the meeting. In the event of equality of
votes, the Chairperson shall have the casting vote. If the number of members of the Supervisory Board is reduced during the
term of office due to resignation, death or any other important reasons below the number of members of the Supervisory
Board set for a given term of office by the General Meeting of Shareholders, then the Supervisory Board is authorised to
appoint a new member by a resolution on co-opting.
Members of the Supervisory Board may participate in adopting the resolutions of the Supervisory Board by voting in writing
through another member of the Supervisory Board subject to Article 388 of the Code of Commercial Partnerships and
Companies. Resolutions may be passed by the Supervisory Board by voting in writing, by fax or electronic mail, subject to
Article 388 of the Code of Commercial Partnerships and Companies. The Supervisory Board may establish committees
(including the Audit Committee). In the case of appointment of a committee, the Supervisory Board appoints and recalls its
members as well as sets the method of its organisation.
In 2014, the Supervisory Board did not appoint any committees. In view of the fact that the Supervisory Board is composed of
5 members, the tasks of the Audit Committee were entrusted to the Supervisory Board (pursuant to Article 86 section 1 in
connection with Article 86 section 3 of the Act dated 7 May 2009, on Statutory Auditors, their Self-Government Organisation,
Entities Authorised to Audit Financial Statements and on Public Oversight).
A member of the Supervisory Board should have proper knowledge and experience and be able to allocate sufficient time for
the performance of their duties. Members of the Supervisory Board should participate in General Meetings in a composition
competent to provide substantial answers to questions that can be put forward at the General Meeting.
The meetings of the Supervisory Board may be ordinary or extraordinary. Ordinary meetings should be convened at least
three times a year. Extraordinary meetings of the Board can be convened when necessary, at any time.
37
8. Events after the balance sheet date
8. EVENTS AFTER THE BALANCE SHEET DATE
After the balance sheet date, there were no events, which would materially influence the Company’s situation.
38

Management Board`s Report on activities of Centrum Medyczne

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