Annual Report 2006

Transcription

Annual Report 2006

ANNUAL REPORT 2006
table of content
•
Presentation of the MSA,a.s. company - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 2
•
History of the Company
•
Basic data of the Company
•
Survey of main economic indicators
•
Report of the Chairman of the Board of Directors •
Members of Supervisory Board, Board of Directors and Management •
Basic organizational structure •
Affiliated companies - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 11
•
Representative offices - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 11
•
Report of the Management about the activity of the Company in individual fields »
Business activities »
Purchase - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 15
»
Production
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 15
»
Research and development »
Quality management
»
Personnel matters
»
Ecology - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 18
•
Financial part
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 19 / 46
»
Balance sheet
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 20
»
Profit and loss statement »
Survey of cash flows - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 23
»
Appendix to Balance Sheet
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 24
»
Report of statutary authority of the Company
»
Report of an independent auditor - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 44
»
The Report of the Supervisory Board
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 46
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page 1
Presentation
of the company MSA, a.s.
The fact, that the MSA, a.s., is today one of leading
modern industrial enterprises in the Czech Republic and
a significant world manufacturer and supplier of industrial valves, is a result of long-year tradition in production of industrial valves under its own trade mark. Quality production based on experience of several
generations of workers and technicians is verified by
long-term application in various operational and clima-
tic conditions all over the world. Strong position on the
market is fruit of active sales policy,
The MSA, a.s. manufactures and supplies industrial valves of its own design manufactured in compliance with
internationally approved technical standards ČSN, EN,
API, ANSI and GOST.
The valves manufactured by the MSA, a.s.,
have been applied in following branches of industry:
• Transport and processing of oil
• Transport, distribution and processing of gas
• Chemical industry
• Nuclear and classic energetics, heating industry
and heat networks
• For special applications
Basic production series of valves is divided into four product segments:
page 2
P ro d u c t
C h a ra c t e r i s t i c
Application
Gate valves, globe valves,
swing check valves
Stop valves made of cast semiproducts. Flanged or welded connection with piping. The design complies with the API, ANSI, ČSN EN or
GOST standards according to customer´s requirement.
Petrochemistry, gas
industry, power engineering,
waterworks engineering
Ball valves
Stop valves with the same flow rate loss as the piping. They are made
only from forged semiproducts in the totally welded or bolted construction. Flanged or welded connection with the piping. The design
complies with the API, ANSI, ČSN EN or GOST standards according to
customer´s requirement.
Gas, oil or other
working substance transportation, petrochemistry,
gas industry, waterworks
engineering
Gate valves, globe valves,
swing check valves,
butterfly valves
Stop or regulating valves made of forged semiproducts. Flanged or
welded connection with piping. The design is mostly performed according to specific customer´s requirements.
Classic and nuclear
power engineering
Through conduit gate valves
Stop valves with the same flow rate loss as the piping. Made both
from cast and from forged semiproducts. Flanged or welded connection with the piping.
Transportation of oil
and its products, petrochemistry
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History
of the company MSA, a.s.
The company MSA a.s. has a unique history covering the „three centuries of human existence“. The firm has never interrupted the production and with the exception of a very short starting period it has always maintained
the character of industrial production.
1 8 9 0 / the firm Holuscha – wood and round timber processing factory established
1 9 1 0 / extension by forging shop and foundry
1 9 1 5 / introduction of locksmith production
1 9 2 0 / construction of an engineering shop, beginning of steam pumps production for mines
1 9 2 3 / introduction of central heating body level heating and boilers production
1 9 3 9 / changeover to military production
1 9 4 7 / name was changed on Moravskoslezská armaturka, n.p. and the company was transferred under
government administration
1 9 5 5 / construction of varnishing shop and testing station
1 9 7 5 / begining of valve production for nuclear power engineering
1 9 7 9 / the plant involved into SIGMA concern with registered office in Olomouc
1 9 8 3 / start of industrial pump production
1 9 9 2 / privatisation of the state-owned enterprise, the MSA, a.s.,Dolní Benešov was founded
1 9 9 5 / start of API a ISO 9001 certifications
2 0 0 0 / sale of pumps and small investment units was terminated
2 0 0 6 / entry of present owners of MSA Holding, a.s. as a new 100 % owner of the MSA, a.s.
At present the MSA, a.s. is a very modern, significantly consolidated company with a clear and prospective manufacturing program and with extensive of sale all over the world.
page 4
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Basic data
about the company MSA, a.s.
Business firm
MSA, a.s.
Identification No.
45 19 22 78
Registered Office
Dolní Benešov, Hlučínská 41, Post Code 747 22
Establishment of the company
The Company was once-only established by the Fund of national
property of the Czech Republic as sole founder, on the basis of deed
foundation of 29th April 1992 in form of a notarial record.
Date of registration in the Trade Register
30th April 1992
Legal form
Joint Stock Company
Register court
Regional Court Ostrava
Company No. in the Business Register
section B, insert No. 388
Main subjects of business
•
•
•
•
•
•
•
Basic capital at 31st December 2006
23 019 tsd. CZK
Share structure at 31st December 2006
1 534 632 pcs of ordinary shares in documentary form and with
nominal value of 15 CZK per one share
Company bodies
• Meeting of Shareholders
• Supervisory Board
• Board of Directors
Company shareholders
at 31st December 2006
A sole shareholder is the MSA Holding, a.s.
Manufacture of valves and pumps
Design and construction of machines and equipment
Purchase of goods for the purpose of further sale and the sale
Metal working
Technical testing, measurements and analyses
Pressure tests of equipment - hydraulic, steam and air
Lock smithery
The Company was established on the indefinite period of time.
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Survey
of main economic indicators
Data in tsd CZK
2006
2005
2004
2003
1,223,459
952,473
816,808
925,309
Long-term assets
274,604
272,136
278,974
303,247
Inventory
323,543
371,669
252,541
327,197
Short-term receivables
583,418
252,815
234,201
215,831
Shareholder´ capital
456,103
453,619
516,570
489,510
Liabilities
764,645
497,786
297,294
435,569
Incomes from the sale of own products,
goods and services
1,720,807
1,130,125
1,373,015
1,143,664
Export
1,604,985
918,740
1,257,490
994,731
Operational trading income
18,139
39,174
29,634
19,934
Financial trading income
24,397
-1,367
-2,988
-18,775
Extraordinary trading income
-28,183
-133
3,713
970
Trading income for the period
14,353
37,674
30,359
2,129
Average number of employees (number of persons)
585
549
583
623
Sales rentability - ROS (in %)
0,83
3,33
2,21
0,19
Whole capital rentability - ROA (in %)
1,17
3,96
3,72
0,23
Equity capital rentability - ROE (in %)
3,15
8,31
5,88
0,43
226,035
219,507
246,934
182,300
25
69
52
3
Total assetts
Working capital (in tsd CZK)
Trading income per employee (in tsd CZK)
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page 7
Report
of the chairman
of the board of directors
Dear shareholders, dear business partners,
dear employees, Ladies and Gentlemen,
One of the main events in 2006 that had decisive influence
on the operations of the whole company, was the sale of
the company, change of the shareholders and hence the
change of administrative and managing bodies of the company. The first half of the year was devoted to preparation
of the company to sale by its original shareholders. It is
quite clear that the management of the company business
and economic indicators was subjected to this target.
During the takeover of the Company an audit was performed, and the Board of Directors and the Management of
the company were acquainted with the results thereof at
the end of the period. The audit showed us the real state of
the Company at the moment of the takeover and provided
us stimulations for further work and recomended the direction in which the Company should develop in the field of
improvement of the management and organization of
work.
The production and business potential and good competitive ability are the most important positive aspects of the
MSA, a.s., while preparation and assurance of the plan, no
motivation program, poor quality of intercompany communication or insufficient personnel policy are not very good
features.
In the second half of the year the Board of Directors made
efforts to maintain stabile run of the Company and to fulfill
planned results for 2006. In the same time the acquaintance with the organization of work and with the employees
was performed.
In 2006 the Company achieved record growth of receivables amounting to 1 721 mil. CZK, which represents increase by 52.3 % in comparison with the preceding period.
This result was achieved by getting orders from new territories, especially those in Asia, as e.g. Indonesia, Singapoor or
China. These orders were supported by the growth of receivables at the buyers from traditional destinations, as the
Czech Republic, Russian Federation or west and south Europe.
However the Company cannot be satisfied with the achieved results, it is taking steps leading to maintenance and
improvement of these positions in future. Therefore the
plans of business, production and investment activities in
2007 were prepared and approved by the shareholders at
the end of the year.
In spite of the above mentioned good results, we are aware
of drawbacks that had impact on final economic results of
the Company, as e.g. fulfillment of not very profitable con-
page 8
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tracts and non-performance of contracting term of fulfilment, that resulted in charging us with penalty by the
buyer. The unprofitability of contracts was caused particularly due to non-planned significant increase of input prices
of some types of material at the half of 2006 especially in
orders placed in this period.
In this connection I would like to stress that the new shareholders could have cancelled these contracts in spite of
the risk of future penalty due to failing to perform them
and possible loss of business contacts. However it is possible to suppose that future losses as penalty from unprofitable contracts or loss of good name of the company at the
buyers would have been considerably worse than the
decrease of profit and penalization for delayed performance. Another negative consequence of cancellation of these
contracts would have caused lower utilization of existing
production capacities, higher overhead costs and loss of
employees opportunities in the MSA, a.s. Therefore the Board of Directors decided to continue to fulfill these contract
in spite of their being unprofitable, because this fulfillment
may support existing and achievement of new business
contracts in future.
Further steps in near future are to be taken in the field of
production program innovation. The Company tries to extend the number of material types at forged steel ball valves and in the same time to extend the aplication of these
valves for extreme conditions, as e.g. – 200 °C.
The through condiut gate valves are another group of products we are going to focus on and to develop them further. In 2006 we produced 10 pcs of these valves and we
have achieved contracts for more than hundred pieces in
sizes DN 300 up to 1000.
We and the Management of the company are going to
focus on gradually improvement of the economy of the
company, on introduction of changes in the managing system of control, in planning, in improvement of intrecompany communication and cooperation between individual
departments.
I hope that this year is going to be at least as successful as
the preceding year, that we are going to achieve further
development of the company and improve economic situation not only in compliance with the aims of the shareholder, but for the benefit of all employees as well.
Ing. Jozef Leščišin
Chairman of the Board of Directors
Members
of the supervisory board, board of directors and management of company
SUPERVISORY BOARD
BOARD OF DIRECTORS
MANAGEMENT
Vladimir Viktorovich
Khristenko
Ing. Pavel Maier
Executive Director
Valery Nikolaevich Shipilov
Ing. František Šamal
Member of the Board of Directors
Sales Director
Ing. Karel Ren, CSc.
Ing. Jan Halfar
Production Director
Chairman of the Supervisory Board
Sergey Igorevich Moiseyev
Member of the Supervisory Board
Viktor Mikhailovich Fedotov
Ing. Pavlína Gratzová
Stephen Lukas
Purchase Director
Ing. Pavol Peťko
Leo Stařinský
Quality Assurance Director
Ing. Ivana Hamerková
Miloslav Sonnek
Authorized to manage
financial department
The above mentioned structure of the Supervisory Board, Board of Directors and Management of the company is
valid at 31th December 2006. The changes which has been made in the course of 2007 are described in the financial part – Appendix to Financial Statement.
Basic
organizational structure of the company in 2006
Meeting of Shareholders
Supervisory Board
Board of Directors
General Director
Executive Director
Financial department
Sales department
page 10
Representative of QMS management
Production department
Purchase department
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Department for quality assurance
Affiliated
companies
Opravárenský závod MSA, s.r.o., Dolní Benešov, Czech Republic
BULTRADE MSA, Ltd., Sofie, Bulgaria
„LOZNICA-GAS“ A. D. Loznica, Serbia and Monte Negro
MSA Slovakia s.r.o., Bratislava, Slovak Republic
ZPA MORAVIA s.r.o., Dolní Benešov, Czech Republic
Representative
offices
Representative office MSA Moscow, Russian Federation
Representative office MSA Geneva, Switzerland
Representative office MSA Peking, China
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page 11
Report
of the management about the activity of the company in individual fields of activity
• B U S I N E S S A C T I V I T Y
The amount of annual sale of products, services and business goods has exceeded level of one milliard CZK in the
long term. The receivables volume over 1.7 milliard CZK
was achieved, which is a record in the modern history
of the Company. The sale of valves of our own production has decisive share in annual volume of sales. The
sales development definitely shows the stability and
the rising of growth trends of the Company.
Total receivables in mil. CZK
989
1 010
1 077
1 116
991
1 054
1 065
1 176
1 087
1 144
1 373
1 130
1 721
1994
1995 1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
The receivable growth corresponds with the export
orientation of the Company. In 2006 the export grew
up by more than three times in comparison with star-
ting year 1994. In 2006 the share of export in the total
receivables was 93 %.
Total export in mil. CZK
page 12
550
618
734
859
720
745
784
989
922
995
1 257
919
1 605
1994
1995 1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
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The share of individual territories in total receivables from the sale of valves
The MSA, a.s. has succeeded in gradually shifting the
trend of sales into the territories accepting our sale at higher prices. Therefore the former privileged position of
Other
Pakistan
Russia
Poland
Germany
Czech
Republic
the USA as to the realized volumes of our sales has been
gradually replaced by the countries with more convenient prices as the South Corea, China, Turkey etc.
India
Great
Britain
Indonesia
Turkey
China
USA
South
Korea
15 %
10 %
5%
0%
Assortment structure in 2006
The assortment structure reflects a long-term successful Company´s effort to manufacture economically
advantageable and marketable assortment of ball valves with high inner diameters and in demanding constructions as far as the material and design are concerned. In 2006 the share of ball valves in the products
portfolio achieved total volume over 85 % at the expense of mostly ANSI program valves, that decreased
from its historical maximum in 1998 (approx. 70 %)
gradually to less than 8 % in this year.
0 %
20 %
40 %
When seeking for final users the Company uses many
distribution channels. In China e.g. there has been
developed a successful cooperation by means of the
office in Peking, the network of contractors and representatives has been spread (e.g. in Pakistan etc.), the
contacts with new distributor firms are being sought.
In 2006 the Company participated in many significant
events and trade fairs, professionally focused on industrial valves and their application, in order to support
sale activities. It was first of all participation in traditional international world meeting of valve manufacturer
VALVE WORLD 2006 in Maastricht, where the MSA, a.s.
presented its exposition. The Company was successful
on the international trade fair of firms operating in the
field of gas and oil industries CIPPE 2006 in China or
on a similar trade fair POGEE PAKISTAN 2006. The
MSA, a.s. exhibited together with its business partners
on traditional events as the INTERNATIONAL TECHNI-
60 %
Other
2,9 %
JE valves
1,0 %
DIN valves
3,5 %
ANSI valves
7,5 %
Ball valves
85,1 %
80 %
100 %
CAL FAIR in Bulgarian Plovdiv, oil and gas trade fair
TUROGE 2006 in Turkish Ankara or on Polish trade fair
NAFTA I GAZ in Warsaw etc.
Poland is a stabile market segment of the Company.
The MSA, a.s. has linked to successful deliveries of valves for a new Przyjazn oil pipeline realized by the oil
pipeline operator the PERN Plock S.A. In the course of
a 30-year cooperation of both companies hundreds of
valves have been delivered for almost 2500 km oil and
fuel pipeline distributions, including the deliveries for
individual equipments as e.g. oil tanks assuring strategic oil stock for PKN Orlen refinery, the LOTOS Gdaňsk,
individual pumping stations, the terminal in Gdansk
etc. Long-term cooperation of MSA, a.s. technicians
and the operator supported the design of through
conduit gate valves and high size valves in the present
form and quality.
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page 13
The success with the new customers in the south Europe countries, expecially Romania, are rather stimulant.
The deliveries of the MSA, a.s. to Romania were very
rare until 2005. Thanks to Borankol project with a Romanian firm as a main contractor the company returned
again to the consciouceness of Romanian final users.
In addition to the above mentioned current project,
contact with other subjects was arranged that lead to a
contract on delivery of ball valves for one of the largest
Romanian gas distributors at the end of 2006.
In 2006 the MSA, a.s. managed to get a big and significant contract for delivery of 256 pcs ball valves for
oil pipeline project in China – the West Crude Oil Pipeline. This order was one of the biggest in 2006 (approx. 7 mil. USD). The MSA, a.s. achieved a significant
position at the Chinese state owned firm CPMEC. In
the same time the increasing business connections with
Pakistan went on. The MSA, a.s. delivers ball valves to
state-owned firms SSGC Karachi and SNGPL Lahore for
Pakistan gas-net projects.
In Greece the business transactions are being made
with the valve producer who completes the assortment
of the MSA, a.s. production. The ball valve have been
delivered for a Belgium contractor for the construction
of compresion station on the border between Greece
and Turkey.
The MSA, a.s. has also linked on good references from
previous deliveries in India and achieved a few further
contracts on ball valves for gas pipelines including some
brand-new customers.
By means of an Austrian supplier we managed to penetrete to the Balkan, to Serbia and Slovenia, and the
valves have been delivered to the main gas distributors
in these countries.
In 2006 the Company delivered more than 200 pcs ball
valves for the South Sumatera - West Java Gas Pipeline
project.The final user is an Indonesian state-owned firm
PGN and the volume of all orders amounted to approx.
6.5 mil. USD. At the end of the year the installations of
ball valves were started and are going to continue in
the next year.
The delivery of valves into the traditional territories of
west Europe can also be evaluated positively.
In 2006 the Company cooperated with the BOTAS, a turkish state-owned firm. The MSA, a.s. has delivered ball
valves for some significant projects, as e.g. the Azerbayian - Turkey NGPL project, Turkey - Greece NGPL project,
East Black Sea project and for Hanak a Sivas Compressor
station. The total volume of all orders exceeded 5.5 mil.
USD. In addition to the mentioned projects further 552
big valves were delivered to this region as spare parts for
the BTC project in total amount of approx. 2.8 mil. USD.
The volume of sale to the South Corea achieved in 2006
record values due to successful cooperation with the KOGAS company. This trend will obviously be maintained
in future.
The MSA, a.s. made efforts to expand deliveries to Saudi
Arabia where the requirements on special materials are
ever more frequent (Saudi Aramco). The references in
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Saudi Arabia may support our entry to further markets in
this region (Qatar, Oman, UAE).
The American company Zy-Tech Global Industries, Inc. is
and remains a long-term supplier of ANSI valves to American market, in spite of goal-directed regulated decrease
of the deliveries.
We also have to mention home market with traditional
buyers - the gas industry and power engineering company RWE TRANSGAS, ČEZ, a.s. and some other regional
energy distributors etc.
The territory of Russian market also belongs among
the main activities of the Sale department. It has been
transferred into the competence of the partner company
MSA-KTS Moscow after their owners and busines strategy have been changed in 2006.
• P U R C H A S E
The priorities in the production program have changed
after the change of the firm´s owners. The manufacture of through conduit gate valves has been substantially extended and in the same time the ball valves manufacture has increased, the manufacture of the ANSI
valves has been reduced and new possibilities of delivery of valves for nuclear power engineering started to
be sought.
Due to the mentioned changes the requirements on
delivery of castings for through conduit gate valves has
also increased. Cooperation with the Žďas, a.s. foundry was renewed, and new possibility of cooperation
with foundries in France have been sought. The contacts with the Tamaris firm have been successfully established and in comparison with the preceding periods the volumes of casting delivery for this assortment
from ČKD Kutná hora a.s. increased.
In the field of the ANSI and DIN program, where the
production has been reduced, the deliveries were focused on the ROUČKA SLÉVÁRNA a.s., the traditional
and most significant supplier of castings.
The deliveries of castings from Asian countries were
terminated due to limitation of gate valves, swing
check valve and globe valves for the Zy-tech, and in-
tensive searching of new suppliers of semiproducts for
ball valve production and negotiations with them started due to increased demand on this product. The cooperation with Italian and Romanian forging producers
continued for assuring the deliveries in required quality
and at prices to increase the compatitiveness of the
MSA, a.s. in the world market.
The steep increase of ball valve manufacture was connected with the increase of need to delivery necessary
quantity of finished balls, valve seats and gears. Intensive negotiations with the suppliers of these components in Italy and Romania were opened. For the purpose of quality stabilization and timely fulfillment of
deliveries of forgings further steps were taken in the
field of selection of suppliers of finished balls and seats
with smaller inner diameter from Italy and China. In
the same time negotiations with the actuator manufacturers have been performed in order to fasten mutual cooperation in the field of timely fulfillment with
suppliers of these important valve components.
New suppliers have been searched for deliveries of all
other purchased components and semiproducts so
that the delivery of such components may be assured
and individual orders may be completed without any
problem.
• P R O D U C T I O N
In 2006 the recovery and modernization of production
basis continued with the aim of the removal of capacity disproportion and completion of missing workplaces.
acquired for valves with NPS 6“- 28“ size, wherewith
the testing capacities have increased and the testing
and measuring process improved due to computer
control with record of the testing results.
First of all – a new horizontal machining centre FSQ
100 from TOS Kuřim was realized. It is a modern and
progressive machine with two replaceable technologic
pallets, automatic tool replacement and with the Sinumerik 840 D CNC control system. The machine brought
high reduction of labour intensity as number of various
operations is substantially lower, and additional setting
operations have been reduced.
Following measures have also be taken: the NA 06
welding equipment was modernized, the INVERTEC
and WELDFORCE welding sources purchased; investment into transportation and handling method (highlift trucks); complementation of the high-pressure testing shop by a testing circuit for high-pressure valves,
functional tests; reconstruction of the floor in facilities;
purchase of measuring technology etc.
Another big investment was acquiring of welding
equipment from the OERLIKON firm for welding final
welds into a narrow space between two welding heads
for ball valves and through conduit gate valves S85.
Complete overhaul of numerical controled CNC vertical boring mills SKQ 20 including modernization of
control system, general overhaul of horizontal boring
mills and turning machines have continually continued. The turning and boring mill SKJ 25/50 was elevated for new assortment of S85 valves with high inner diameter.
On the basis of customers requirements on valve quality surface treatment the PROFIMIX 2000 equipment
was bought for application of two-component polyurethan coating substances.
In the field of testing of valves a new test block was
/ A N N UA L R E P O RT 2 0 0 6
page 15
• R E S E A R C H A N D D E V E L O P M E N T
The research and development are steps preceding
manufacture and sale of new and special valves. They
involve many assignments beginning with special calculations for verifying static and dynamic properties of
valves, verification of the suitability of technological
and production processes up to final testing of service
life, validation and verification of suitability of new valves for particular application.
In 2006 the development of through conduit gate valves DN 700 to DN 1000 designated for working pressure 10 MPa was finished, the validation of ball valves
DN 50 to DN 1400 was also finished, and the working
parameters of ball valves, gate valves and swing check
valves for operation temperature up to –50 °C verified.
2006 can be characterized as a year when the production portfolio of MSA, a.s. has been extended by
completely new valves and by valves with quite new
parameters when compared with the original ones,
which makes it possible to apply them for special purposes in the operation.
Therefore intensive development
and research was started to focus on:
•
Testing service life of ball valves in the testing
shop of significant customers, where their suitability and reliability for the whole period of their
operation is verified,
• Type testing of service life and seismic resistance of
through condiut gate valves DN 700 to DN 1200
for working pressure 10 MPa
• Swing check valves DN 700 to DN 1000,
PN 100 with damper for petroleum products,
•
Wedge gate valves DN 200 to DN 1000,
PN 25 to PN 100 with guaranteed tightness on
inlet and outlet side (the so called Double Block
and Bleed)
• Through conduit gate valves DN 500 to DN 1200,
PN 16 to PN 100 for natural gas and oil products
to be used in seismically active regions
• Ball valves DN 50 to DN 1400, PN 100 to PN 250 for
operation under sea level up to the depth 500 m
(the so called Subsea ball valves),
• Ball valves DN 50 to DN 1000, PN 25 to PN 250
designated for temperatures up to -200 °C (the so
called cryogenic ball valves).
• Q U A L I T Y M A N A G E M E N T
The MSA, a.s. has been granted many process and
product certifications enabling to supply products to
foreign and home markets.
System certificates
The most important certificates covering the processes
of the whole company: • API
• ISO
Import certificates
Certificates connected with requirements of national standards exporting countries (Russian federation
Kazakhstan, Ukraine):
• GOST-R
• AD 2000 HPO / TRD201/ EN 729-2
(connected with technical requirements on products,
serves as an instrument for re-verification of reliability
performance of the system).
Product certificates
Application of system certificates on a particular pro• API 6D - 0239
duct:
• API 6A - 0799
page 16
/ A N N UA L R E P O RT 2 0 0 6
Note:
After import certificate requirements have been fulfilled (crossing the border) a „technological“ licence
may be required for installation of valves (e.g. for mining or metallurgical plants) (see e.g. Russian Federation)
Certificates connected with safety in nuclear power engineering
Purpose certificates
a) Necessary category according to Czech law:
Supervision of the nuclear safety system
(proof of conformity).
b) Standards of Russian Federation system (according
to the importing countries):
Standards for securing safety of nuclear
power engineering based on ISO system –
they are applied on the required „Certificate
of conformity“ with nuclear safety systems
in Russian Federation
The product is subjected to various technical and technological testings at independent companies (investigating e.g. service life, fire resistance, frost resistance
etc.) – the product achieves higher level of significance:
• LLOYD´S REGISTER
• DET NORSKE VERITAS etc.
European Union certificates
In 2006 the processes started focused on getting further licences and certifications „TRANSSERT“ according to American standard (Monogram according to
API Spec 6A) and the licence according to the nuclear
safety system (ASME Code III).
The conformity of selected products shall be proved
for export into the countries of European Union according to Regulations EU PED 97/23 EG (CE, modul H) –
there is also duty to prove conformity by an authorized
testing establishment at selected products supplied to
Czech market.
Within the framework of categorization of purpose
certifications the certification proces (proof of conformity) was opened on inexplosive type of construction
(ATEX) and equipment of operation reliability (SIL) for
selected MSA, a.s. assortment.
• H U M A N R E S O U R C E S
In 2006 the HR department was focused especially on recruitment and maintaining of high qualified
employees. Average number of personnel in 2006 increased by 36 persons in comparison with last year,
which represents a 6.6 % growth. At 31th December
2006, the company had 590 employees.
fication to be one of deciding aspects for fulfillment of
its business intention. When realizing planned conceptions of in-house education the company makes effort
to prepare all employees to attend a lot of various trainings and courses including professional training.
Long-term system of training of Company´s employees has been prepared for the purpose of creation
and maintaining of optimum qualified structure of
employees. The strength of the Company are high qualified employees with long-term experience in the field
of manufacture of valves and related professions.
The Company considers its employees and their quali-
0 %
20 %
40 %
Basic education
60 %
3,7 %
Trained
55,1 %
Secondary education
31,7 %
University education
9,5 %
80 %
100 %
Social program
The social policy of the company was realized in the
field of economy and in the field of social background.
Within the framework of social policy of the company
the optimum health and hygiencally suitable working
conditions, medical and rehabilitation services on the
area of the company, catering in works canteen etc.
have been created. In the field of economy: contributions for catering, on pension insurance and life insurance of employees. The goal of social policy is also the
effort to satisfy personal needs of employees as much
as possible.
/ A N N UA L R E P O RT 2 0 0 6
page 17
• E C O L O G Y
Long-term gools of the Company in the field of ecology are focused on strict observance of all requirements
of legal standards and regulations related to environmental policy, on minimizing the impact of production activity in the company´s facilities and in the near
surroudings on living environment, and on permanent
improvement of living and working environment.
In last year the Company was preparing the removal
of old ecological burdens and sanation of problematic
localities of the area. The Fund of National Property
placed an order to perform additional research and
project documentation and appointed the firm TALPARPF, s.r.o. Ostrava to be the project manager. The TALPA - RPF, s.r.o. Ostrava performed the specification and
complementation of the research results and prepared
Final report about the research and project of sanation. They also prepared Apendix to the Final Report
on requirement of the Czech enviroment inspection,
where the localities in the area to be sanated were
specified. These documents will serve for the Czech
environment inspection to issue obligatory Decision
about placing the correcting measures – sanations of
old ecological burdens in the MSA, a.s. Dolní Bene-
page 18
/ A N N UA L R E P O RT 2 0 0 6
šov area. On the basis of Administration decision of
the Czech enviroment inspection, the elaboration of
„The project of realization of corrective measures“ will
be assigned with expected opening of sanation works
and usage of guarantee fund in 2008.
Working environment
At the beginning of the year the workplace pressure
air-blast chamber and preparatory box was approved
for use. By putting into operation of this workplace
with efficient filters the dust particles emission into the
environment was reduced.
The year 2006 was in token of the research of the
consumption of diluents, the varnish shop has been
researched in order to minimize their consumption and
to reduce the share of organic matter emmissions in
the atmosphere.
At the same time the fulfillment of the „Plan of waste
management MSA, a.s.“ have been executed, i.e. the
reduction of non-recyclable waste production, the support of classification of recyclable waste, the efficient
management of oil management and the reduction of
biologically decomposable waste on waste dump etc.
Financial
part
Financial
part
» BALANCE SHEET full version – modify at 31/12/2006
(in thousands CZK)
Denotation
a
A.
B.
I.
1.
2.
3.
4.
5.
6.
7.
8.
II.
1.
2.
3.
4.
5.
6.
7.
8.
9.
III.
1.
2.
3.
4.
5.
6.
7.
C.
I.
1.
2.
3.
4.
5.
6.
II.
1.
2.
3.
4.
5.
6.
7.
8.
III.
1.
2.
3.
4.
5.
6.
7.
8.
9.
IV.
1.
2.
3.
4.
D.
I.
1.
2.
3.
page 20
ASSETS
b
TOTAL ASSETS
Receivables for capital subscription
Fixed assets
Intangible fixed assets
Incorporation expenses
Research and development
Software
Valuable rights
Goodwill
Other intangible fixed assets
Intangible fixed assets in progress
Advance payments for intangible fixed assets
Tangible fixed assets
Land
Buildings
Individual movable assets and sets of movable assets
Perennial crops
Breeding and draught animals
Other tangible fixed assets
Tangible fixed assets in progress
Advance payments for tangible fixed assets
Price difference to acquired assets
Long-term financial assets
Shares in controled enterprises
Shares in enterprises under substantial influence
Other securities and ownership interests
Loans and credits to controlled entities and accounting units under substantial influence
Other long-term financial assets
Acquired long-term financial assets
Advancements for long-term financial assets
Current assets
Inventory
Materials
Work-in-progress and semi-finished products
Products
Animals
Merchandise
Advance payments for inventory
Long-term receivables
Trade receivables
Receivables from controlled entities
Receivables from accounting units under substantial influence
Receivables from partners, members of cooperative and in participants in association
Long-term advance payments made
Estimated receivables
Other receivables
Deferred tax receivable
Short-term receivables
Trade receivables
Receivables from controlled entities
Receivables from accounting units under substantial influence
Receivables from partners, members of cooperative and in participants in association
Social security and health insurance
State - tax receivables
Short-term advance payments made
Estimated receivables
Other receivables
Short-term financial assets
Cash
Bank accounts
Short-term securities and shares
Acquired short-term financial assets
Temporary accounts of assets
Deferred expenses
Complex deferred expenses
Accrued revenue
/ A N N UA L R E P O RT 2 0 0 6
Current accounting period
Gross
Adjustment
Net
1
2
3
2,038,712
-815,253
1,223,459
Prev. period
Net
31/12/2005
952,473
1,042,627
25,693
-768,023
-23,056
274,604
2,637
272,136
4,542
25,495
45
-23,011
-45
2,484
4,542
153
153
1,008,758
17,499
409,312
545,593
-744,346
264,412
17,499
182,282
45,811
259,394
17,680
186,102
40,826
33,594
660
2,100
-17,534
16,060
660
2,100
12,376
2,410
8,176
8,134
42
-621
-588
-33
7,555
7,546
9
8,200
8,151
49
986,696
358,834
194,055
94,851
63,702
-47,230
-35,291
-4,751
-11,127
-18,371
939,466
323,543
189,304
83,724
45,331
671,010
371,669
196,005
107,799
65,154
6,226
-1,042
5,184
0
0
0
2,648
63
0
595,357
530,390
-11,939
-2,815
583,418
527,575
252,815
226,140
20,031
2,714
356
32,742
32,505
142
32,363
9,538
5,037
237
11,863
46,526
186
28,898
17,442
9,389
9,311
9,327
9,245
78
82
20,031
2,827
356
41,753
32,505
142
32,363
9,389
9,311
78
-227,030
-499,782
-113
-9,011
0
0
Financial
part
Denotation
a
A.
I.
1.
2.
3.
II.
1.
2.
3.
4.
III.
1.
2.
IV.
1.
2.
V.
B.
I.
1.
2.
3.
4.
II.
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
III.
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
IV.
1.
2.
3.
C.
I.
1.
2.
LIABILITIES
b
Current accounting period
5
TOTAL LIABILITIES
Equity
Registered capital
Registered capital
Own shares and own business shares (-)
Changes in registered capital
Capital funds
Share premium
Other capital funds
Price differences from revaluation of assets and liabilities
Price differences from revaluation during transformation
Reserve funds, indivisible fund and other funds from net profit
Legal reserve fund/indivisible fund
Statutory and other funds
Profit / loss of previous years
Retained earnings from previous years
Accumulated losses from previous years
Profit / loss of current accounting period (+/-)
Other resources
Reserves
Reserves under special legal regulations
Reserves for pension and for similar liabilities
Income tax reserve
Other reserves
Long-term liabilities
Trade liabilities
Liabilities to controlled entities
Liabilities to accounting units under substantial influence
Liabilities to partners, members of cooperative and participants in association
Long-term advance payments received
Bonds issued
Long-term bills of exchange to be paid
Estimated liabilities
Other liabilities
Deferred tax liability
Short-term liabilities
Trade liabilities
Liabilities to controlled entities
Liabilities to accounting units under substantial influence
Liabilities to partners, members of cooperative and participants in association
Liabilities to employees
Liabilities from social security and health insurance
State – tax liabilities and subsidies
Short-term advance payments received
Bonds issued
Estimated liabilities
Other liabilities
Bank credits and assistances
Long-term bank credits
Short-term bank credits
Short-term financial assistance
Temporary accounts of liabilities
Accrued expenses
Deferred revenue
/ A N N UA L R E P O RT 2 0 0 6
Previous accounting period
6
1,223,459
456,103
23,019
23,019
952,473
453,619
23,019
23,019
36
-909
93
-57
93
-1,002
326,373
100,986
225,387
92,322
92,322
326,373
100,986
225,387
67,462
67,462
14,353
764,645
15,203
37,674
497,786
3,868
15,203
0
3,868
0
306,003
240,374
298,102
252,918
9,197
4,966
1,206
9,528
7,982
5,245
1,447
20,944
40,150
582
443,439
36,011
407,428
9,190
376
195,816
42,415
153,401
2,711
2,711
1,068
1,068
page 21
Financial
part
» P R O F I T & L O S S AC C O U N T f u l l v e rs i o n – m o d i f y a t 3 1 / 1 2 / 2 0 0 6
(in thousands CZK)
Denotation
a
I.
A.
+
II.
1.
2.
3.
B.
1.
2.
+
C.
1.
2.
3.
4.
D.
E.
III.
1.
2.
F.
1.
2.
Revenues from goods sold
Costs of goods sold
Sale margin
Production
Revenues from finished products and services
Changes in inventory of own production
Capitalization (of own work)
Consumption from production
Consumption of material and energy
Services
Value added
Personnel expenses
Wages and salaries
Bonuses to board members
Social and health insurance
Other social expenses
Taxes and fees
Amortization of intangible and tangible assets
Revenues from intangibles, tangibles and material sold
Revenues from intangibles and tangibles sold
Revenues from material sold
Net book value of intangibles, tangibles and material sold
Net book value of intangibles, tangibles sold
Material sold
Change in reserves, adjustments and prepaid expenses
and complex deferred expenses
G.
IV.
Other operational revenues
Other operational expenses
Transfer of operational revenues
Transfer of operational expenses
Net operating result
Revenues from sale of securities and deposits
Sold securities and deposits
Revenues from financial investments
H.
V.
I.
*
VI.
J.
VII.
1.
2.
3.
VIII.
K.
IX.
L.
M.
X.
N.
XI.
O.
XII.
P.
*
Q.
1.
2.
**
XIII.
R.
S.
1.
2.
*
T.
***
****
page 22
Current
01–12/2006
b
Revenues from shares in controled enterprises and in enterprises
under substantial influence
Revenues from other securities and deposits
Revenues from other financial investments
Revenues from short-term financial assets
Financial assets expenses
Revaluation of property securities revenues and financial derivates
Revaluation of property securities expenses and financial derivates
Change in financial reserves and adjustments
Interest revenues
Interest expenses
Other financial revenues
Other financial expenses
Transfer of financial revenues
Transfer of financial expenses
Net result from financial activity
Income tax on ordinary activity
- Due
- Deferred
Net result after taxation from ordinary activity
Extraordinary revenues
Extraordinary expenses
Income tax on extraordinary activity
- Due
- Deferred
Net result from extraordinary activity
Income distribution to partners (+/-)
Net profit / loss for the accounting period (+/-)
Profit / loss before taxation
/ A N N UA L R E P O RT 2 0 0 6
Previous period
5/2004–12/2005
87,256
73,992
13,264
1,687,773
1,633,551
-22,300
76,522
1,400,167
1,106,693
293,474
300,870
211,714
149,627
3,880
52,286
5,921
899
32,008
34,780
22,215
12,565
30,786
18,287
12,499
220,087
185,574
34,513
1,864,526
1,890,624
-65,177
39,079
1,533,700
1,235,801
297,899
365,339
289,858
209,336
2,060
72,358
6,104
2,546
55,914
23,232
3,249
19,983
27,373
2
27,371
28,049
-38,747
425,894
439,949
899,589
897,310
18,139
53,906
131
131
0
700
700
1
121
36,855
4,153
620
682
13,212
81,716
77,572
15,430
18,343
24,397
0
1,566
0
42,536
-28,133
50
0
55,472
285
158
0
-28,183
127
14,353
14,353
55,599
55,599
974
13,027
95,288
78,877
Financial
part
» T h e s t a t e m e n t o f C A S H - F L O W at 31/12/2006
(in thousands CZK)
Denotation
TEXT
P.
The state of financial devices and equivalents at the beginning of period
Z.
Accounting profits and losses from current activity before taxing
Cash flow from the main job (operations)
A.1.
Alternations with no financial operations
Depreciation of fixed assets, except from BP of sold stable assets, and the amortisation of adjusting
A.1.1.
entry for the purchase of assets
A.1.2.
The changes of the state of adjusting entries, reserves
A.1.3.
Profit (loss) from the sale of fixed assets
A.1.4.
Revenues from dividends and shares from profits
A.1.5.
Charged interests from costs (except from capitalized) and revenues
A*
Net cash flow from operations before taxation, changes of working capital and special adjusting entries
A.2.
Status change of no financial items of working capital
A.2.1.
Status change of debts from operations, active accounts of adjustments and conjectural active accounts
A.2.2.
Status change of short-term liabilities from job, passive accounts of adjustments and conjectural passive accounts
A.2.3.
Status change of reserves
A.2.4.
Status change of short-term financial assets - not included into financial devices and equivalents
A**
Net cash flow from the operations before taxation and special items
A.3.
Paid-off interests, except from capitalized interests
A.4.
Accepted interests
A.5.
Paid income tax of current activity and retrospective assessments from last periods
A.6.
PIncomes and costs of special accounting items, including paid income tax due of special activity
A.7.
Accepted dividends and shares from profit
A***
Net cash flow from operations
Cash flow from investment operations
B.1.
Costs connected with the purchase of long-term assets
B.2.
Incomes from the sale of fix assets
B.3.
Loans and credits for allied companies
B***
Net cash flow regarding to investment operations
Cash flow from financial operations
C.1.
Status change of long-term, or short-term liabilities of credit pattern
Period under consideration
at 31. 12. 2006
29,084
42,536
73,429
37,478
28,049
-3,928
-700
12,530
115,965
-304,321
-358,510
9,547
27,200
17,442
-188,356
-13,212
682
0
-855
700
-201,041
-52,566
22,215
0
-30,351
247,626
C.2.
Change impacts of shareholder‘s capital on financial devices and equivalents of funds,
including paid advances on the increase
-12,814
C.2.1.
C.2.2.
C.2.3.
C.2.4.
C.2.5.
C.2.6.
C***
F.
R.
Increase of financial devices from the title of increased BC, emission premium, or reserved
Payment of shareholder‘s capital shares to partners (dividends)
Other financial deposits of partners and shareholder‘s
Payment of losses by partners
Direct payments place of debit of funds
Paid dividends or shares from profit, including paid tax deducted
Net cash flow regarding to financial operations
Net increase or decrease of financial devices
Status of financial devices and equivalents at the end of period
0
-12,814
0
0
0
0
234,812
3,421
32,505
/ A N N UA L R E P O RT 2 0 0 6
page 23
Financial
part
» A P P E N D I X F O R S P E C I A L FINANCIAL STATEMENT
Compiled for the period from 1/1/2006 to 31/12/2006 (in thousands of CZK, if the other currency is not mentioned)
1. The foundation and characteristics of the company
MSA, a.s. („the company“) was registered into the Companies Register at 30th April 1992 at the Regional Court in Ostrava, section B,
number of insert 388, identification number 45192278.
The company’s principal activity is the manufacture of valves.
Company owners
The shareholders of the company are by 31st December 2006:
MSA Holding, a.s.
100 %
Company registered office
MSA, a.s.
Hlučínská 41
Dolní Benešov
747 22
Changes in the Companies Register
In the course of 2006, the following changes which were recorded in the Companies Register were realised:
1)
By 16/1/2006 the company MSA Holding a.s. (IN 27415716) was established by the fusion of the companies Noto Estates, s.r.o.
(IN 27135331) and San Consulting, a.s. (IN 27105709), whereas the property of expirable companies passed over the succession
company, including rights and duties. The succession company MSA Holding, a.s. became 100 % owner of MSA, a.s. because the
expirable company San Consulting, a.s. had owned 100 % shares of MSA, a.s.
2) The other changes recorded in the Companies Register regarded to the structure of the Board of Directors and the Supervisory Board:
page 24
- by 7/9/2006 Ing. Karel Ren, CSc. was erased from the position of the Chairmain of the Board of Directors, Ing. František Šamal
and Ing. Pavel Maier were erased as the members of the Board of Directors (in the position till 1/8/2006)
- by the same day (7/9/2006) Ing. Jozef Leščišin was registered as the member of the Board of Directors (since 1/8/2006) and the
Chairmain of the Board of Directors (since 2/8/2006); and Ing. Karel Ren, CSc. (since 1/8/2006) and Valery Nikolaevich Shipilov
(since 1/8/2006) were registered as the members of the Board of Directors
- by 7/9/2006 Stephen Lukas was erased from the position of the Chairman of the Supervisory Board and Ing. Pavol Peťko from the
position of the member of the Supervisory Board (in the position till 1/8/2006)
- by 7/9/2006 Stephen Lukas, Sergej Igorevich Moiseyev, Viktor Mikhailovich Fedotov and Vladimir Viktorovich Khristenko were registered as the members of the Supervisory Board (since 1/8/2006)
- by 26/10/2006 Mr. Miloslav Sonnek was registered as the member of the Supervisory Board (since 13/9/2006)
- by 26/10/2006 Vladimir Viktorovich Khristenko was registered as the Chairman of the Supervisory Board (in the position since
21/9/2006)
/ A N N UA L R E P O RT 2 0 0 6
Financial
part
Members of the Board of Directors and the Supervisory Board by 31/12/2006
Members of the Board of Directors
chairman
member
Ing. Karel Ren, CSc.
member
Members of the Supervisory Board
Vladimir Viktorovich Khristenko
chairman
Sergey Igorevich Moiseyev
member
Viktor Mikhailovich Fedotov
member
Stephen Lukas
member
Leo Stařinský
member
Miloslav Sonnek
member
Company management by 31/12/2006
Ing. Pavel Maier
Executive Director
Ing. František Šamal
Sales Director
Ing. Jan Halfar
Production Director
Ing. Pavlína Gratzová
Purchase Director
Ing. Pavol Peťko
Quality Assurance Director
vacant - Ing. Ivana Hamerková in charge
of the controlling of the economic department
Economic Director
Structure of the Board of Directors and the Supervisory Board has changed in 2006 and since the beginning of 2007 (till the compiling of the appendix)
By 1/8/2006 on the basis of the decision of the only shareholder, Ing. Karel Ren CSc. was repealed from the position of the Chairman of
the Board of Directors and Ing. Pavel Maier and Ing. František Šamal were repealed from the position of the members of the Board of
Directors. By the same day, Ing. Karel Ren CSc., Valery Nikolaevich Shipilov and Ing. Jozef Leščišin were appointed as the members of the
Board of Directors. Ing. Jozef Leščišin was appointed as the Chairman of the Board of Directors by 2/8/2006.
By 1/8/2006 on the basis of the decision of the only shareholder, Mr. Stephen Lukas (still is the member of the Supervisory Board) was
repealed from the position of the Chairman of the Supervisory Board and Ing. Pavol Peťko was repealed from the position of the member
of the Supervisory Board. By the same day, Sergey Igorevich Moiseyev, Viktor Mikhailovich Fedotov and Vladimir Viktorovich Khristenko
were appointed as the members of the Supervisory Board. The election for the purpose of completing the Supervisory Board according to
the Articles of Association took place in MSA, a.s. from 12/9/2006 to 13/9/2006. On the basis of the results of the election, Mr. Miloslav
Sonnek was appointed as the member of the Supervisory Board. By 21/9/2006 Mr. Vladimir Viktorovich Khristenko was appointed as the
Chairman of the Supervisory Board.
By 31/12/2006 on the basis of the decision of the only shareholder, Ing. Karel Ren, CSc. was repealed from the position of the member of
the Board of Directors and by 1/2/2007 Ing. Ivana Hamerková was appointed as the member of the Board of Directors.
By 31/12/2006 on the basis of the decision of the only shareholder, Mr. Stephen Lukas was repealed from the position of the member of
the Supervisory Board and by 1/2/2007 Mr. Evgeny Genadievich Golovachev was appointed as the member of the Supervisory Board.
/ A N N UA L R E P O RT 2 0 0 6
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Financial
part
Company management has changed in 2006 and since the beginning of 2007 (till the compiling of the
appendix)
By 2/8/2006 Ing. Karel Ren, CSc. was repealed from the position of General Director and the position has not been occupied till nowadays, all rights and duties have passed over the Chairman of the Board of Directors.
By 12/9/2006 Ing. Světluše Kozikowská resigned from the position of the Economic Director and Ing. Ivana Hamerková has been in
charge of the controlling of the Economic department since the following day. By 1/2/2007 she was appointed as the Economic Director.
By 31/12/2006 Ing. František Šamal resigned from the position of the Sales Director. Temporarily till the appointment of new Sales Director, Mgr. Stanislav Herudek was in charge of the controlling of the Sales department in the area of business and dealing with customers
since 22/1/2007 and Mr. Miloslav Sonnek was in charge of the controlling of the Sales department in area of plan creation and checking
of fulfilment of the plan since the same day. By 1/2/2007 two Sales Directors were appointed, Mgr. Stanislav Herudek as the Overseas
Sales Director and Ing. Michael Slaný as the Sales Director for Europe.
Present Production Director Ing. Jan Halfar was appointed as the Technical Director by 1/2/2007. Mr. Josef Stacha was in charge of the
controlling of the Production department in February 2007 and Ing. Jaromír Nenička, MBA was appointed as the Production Director by
1/3/2007.
The Purchase Director Ing. Pavlína Gratzová resigned from her position by 6/2/2007, and since then Ing. Pavel Maier has been in charge
of the controlling of the Purchase department.
Company structure
Meeting of shareholders
Supervisory Board
Board of Directors
General Director
Executive Director
Economic department
Sales department
Representative of QMS Management
Production department
Purchase department
Quality assurance department
2. Accounting methods and principles applied by the company
The special financial statement was compiled for the accounting period 1/1/2006 – 31/12/2006. In the column of the Current accounting
period there are data for the period from January to December 2006 (for Profit and Loss Account) and data by 31/12/2006 (for Balance
Sheet). In the column of the Previous accounting period there are data from May 2004 to December 2005 (for Profit and Loss Account)
and data by 31/12/2005 (for Balance Sheet).
page 26
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Financial
part
(a) Tangible and intangible fixed assets
Valuation
Tangible and intangible fixed assets are recorded at acquisition price. Tangible fixed assets up to 40 thousand CZK and intangible fixed
assets up to 60 thousand CZK are not recorded in the Balance Sheet and are charged as expense at its purchase, or at its consumption,
except for assets purchased after the leasing termination which are recorded at purchase price or at reproduction price as tangible fixed
assets, except from the models, which are recorded as other tangible fixed assets, and except from computer technology, which is also
recorded as tangible fixed assets.
The expenses for repairs and maintenance of tangible and intangible fixed assets are charged directly into the costs. Technical valuation
of assets exceeding the sum determined by Income Tax Act is capitalised into the value of assets.
Depreciation and amortization methods
Tangible fixed assets are depreciated and intangible fixed assets are amortized according to a depreciation/amortization plan indirectly
through adjustments based on expected operating life. These rates differ from those used for accounting purposes.
The depreciation of the tangible fixed assets and the amortization of the intangible fixed assets begins in a month following the month
when the assets were integrated into utilisation, except from the technical valuation, which is depreciated since the month of capitalisation. In case of disposal of assets, which are not fully depreciated, the last depreciation is recorded in the month preceding the month
of disposal.
The following chart shows methods and terms of depreciation/amortization according to groups of assets:
Assets
Method
Depreciation/Amortization Period
Buildings
Linear
20 – 77 years
Machines and instruments
Linear
4 – 17 years
Cars and other motor vehicles
Linear
4 – 17 years
Other intangible assets
Linear
5 years
Software
Linear
4 years
(b) Long-term financial assets
Stocks and shares of the company which represent the participation with dominant and important influence are evaluated by acquisition
price. Other stocks and shares are evaluated by the real value at the end of the balance sheet day.
(c) Inventory
Material inventory are valued at fixed, pre-determined acquisition prices, the difference between the fixed price and actual acquisition
price and expenses related to acquisition (customs, freight, certificates etc.) is recorded separately.
The variance from the actual acquisition price and expenses related to inventory of material acquisition are dissolved to expenses on
monthly basis, depending on the decrease in material inventory and according to pre-determined method.
Inventory of material produced by own activities, inventory of work-in progress and finished product inventory are valuated at own production costs involving direct costs, production overheads and provision overheads depending on the stage of completion.
Inventory of goods are valuated at acquisition price.
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page 27
Financial
part
(d) Adjustment and reserve determination
The company creates adjustments to tangible fixed assets, long-term financial assets, debts and inventory.
Tangible fixed assets
Adjustment to tangible fixed assets is created on the basis of the applicability analysis.
Long-term financial assets
Adjustment to long-term financial assets is created by the company in the amount of the difference between the valuation of long-term
financial assets and the amount of shareholders´ capital, if it is lower than the valuation of long-term financial assets.
Debts
The company determines the adjustment to doubtful debts on the basis of own analysis of client’s solvency.
Inventory
Adjustments are created on the basis of an individual analysis of the inventory age structure and then in case of inventory inefficiency
regarding to current production program.
Reserve creation
The company creates reserves for its future liabilities. As at the date of the Financial Statement, the company has created a reserve for
warranty repairs of its products and a reserve for conventional fines not yet invoiced.
(e) Foreign currency conversion
In order to calculate foreign currency conversions for a foreign currency transaction during a fiscal year, the company uses the Czech
National Bank’s exchange rate applying to the company and valid on the date following its announcement by the Czech National Bank,
except for: foreign currency cash withdrawals, where the company uses the exchange rate of commercial bank valid on the day of
withdrawal; payments in a foreign currency which the bank does not accept and the payment is credited to a CZK account and converted
by means of the bank’s exchange rate; conversion of domestic supplier invoices made out in a foreign currency, where the supplier’s
exchange rate is used.
As at the date of the Financial Statements, all the assets and liabilities record kept in foreign currencies have been converted to CZK by
means of the exchange rate announced by the Czech National Bank on the Financial Statement date – in accordance with Section 24,
Clause 2, Item a), of the Accounting Act No. 563/1991 of the Czech Collection. Exchange rate profits and losses are recorded in the
Profit and Loss Account.
(f) Derivates
Derivates are valuated according to Section 52 and 53 of the Decree No. 500/2002 of the Czech Code Collection, as amended. The company has decided to treat all derivates as those held for trading. The change of real value was recorded into the Profit and Loss Account.
(g) Research and development
Research and development costs (expenses) are monitored in manufacturing orders through work-in progress. The total value of individual manufacturing orders completed in the given year is capitalised and fully amortized to expenses. Material results of research and
development activities are recorded in sub-ledger accounts at acquisition prices.
page 28
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Financial
part
(h) Leased assets
The company records the assets held under finance leases as follows: the leasing payments are included in expenses on a straight-line
basis over the lease term. Upon the lease termination and purchase of the object of leasing, the object is included in assets at purchase
price or reproduction price.
(i) Income tax
Deferred tax
The deferred tax results from any temporary differences between the book value and tax value of assets and liabilities using the expected
tax rate valid for the forthcoming accounting period. The company records deferred tax receivable only if there is no doubt that it will be
exercised in the forthcoming accounting periods.
Tax due
The tax due is calculated according to tax regulations generally valid in the Czech Republic.
(j) Revenues
Company revenues from the principal activity are recorded in the period when the products, goods or services were delivered or provided
to the customer.
3. Change in accounting methods and procedures
The company did not change valuation methods in the tax period from 1/1/2006 to 31/12/2006.
4. Fixed assets
(a) Intangible fixed assets (IFA)
Acquisition price
Balance at 1/1/2006
Increase
Decrease
Balance at 31/12/2006
Software
Valuable rights
IFA in progress
Total
25,233
45
0
25,278
262
0
415
677
0
0
-262
-262
25,495
45
153
25,693
/ A N N UA L R E P O RT 2 0 0 6
page 29
Financial
part
Accumulated amortization
Software
Balance at 1/1/2006
Increase
Decrease
Valuable rights
IFA in progress
Total
20,691
45
0
20,736
2,320
0
0
2,320
0
0
0
0
23,011
45
0
23,056
Net book value at 1/1/2006
4,542
0
0
4,542
Net book value at 31/12/2006
2,484
0
153
2,637
(b) Tangible fixed assets (TFA)
Structures
and
buildings
Machines
and equipment
17,680
407,322
461,532
48,153
25,972
2,410
0
28,687
991,756
0
3,852
24,860
775
0
45,049
18,110
4,907
97,553
Acquisition price
Land
Balance at 1/1/2006
Increase
Decrease
Other machines and
equipment
Vehicles
TFA in
progress
Deposits
Other TFA
Total
-181
-1,862
-14,734
-872
-93
-46,799
-16,010
0
-80,551
17,499
409,312
471,658
48,056
25,879
660
2,100
33,594
1,008,758
Balance at 1/1/2006
0
198,057
428,343
43,017
22,595
0
0
16,311
708,323
Increase
0
8,482
18,325
1,355
1,372
0
0
1,223
30,757
Decrease
0
-1,862
-14,734
-872
-93
0
0
0
-17,561
0
204,676
431,934
43,500
23,874
0
0
17,534
721,518
Balance at 1/1/2006
0
23,163
0
48
828
0
0
0
24,039
Increase
0
0
0
0
0
0
0
0
0
Decrease
0
-809
0
-48
-354
0
0
0
-1,211
0
22,354
0
0
474
0
0
0
22,828
Total adjustments and
accumulated amortization at 1/1/2006
0
221,220
428,343
43,065
23,423
0
0
16,311
732,362
Total adjustments and
accumulated amortization at 31/12/2006
0
227,030
431,934
43,500
24,348
0
0
17,534
744,346
Net book value
at 1/1/2006
17,680
186,102
33,189
5,088
2,549
2,410
0
12,376
259,394
Net book value
at 31/12/2006
17,499
182,282
39,724
4,556
1,531
660
2,100
16,060
264,412
Accumulated
amortization
Adjustments
Among to the most significant technical valuation of the tangible fixed assets in the period of 1/1/2006 to 31/12/2006 belong:
-
-
-
-
-
page 30
the modernisation of vertical turning machine – IN 7309 in an amount of 4,195 thousand CZK
the reconstruction and modernisation of vertical turning machine - IN 7641 in an amount of 2,605 thousand CZK
the reconstruction of machining centre – IN 9643 in an amount of 3,500 thousand CZK
the technical valuation of “heavy-industry” hall – IN 7698 in an amount of 2,770 thousand CZK (building-up of bases for machines,
extension of central heating, reconstruction of floor)
the modernisation of special drill – IN 7394 in an amount of 1,023 thousand CZK
/ A N N UA L R E P O RT 2 0 0 6
Financial
part
Among to the most significant purchase of tangible fixed assets in the period of 1/1/2006 to 31/12/2006 belong:
-
-
-
-
-
the horizontal drill – IN A0422 – acquisition price is 1,859 thousand CZK
the water compressed mill – IN A0427 - acquisition price is 1,400 thousand CZK
the equipment for colour-sprayed coating – IN A0320 - acquisition price is 1,348 thousand CZK
the folding table positioner – IN A0389 - acquisition price is 903 thousand CZK
the high-pressure piping + pressure test room DUS - acquisition price is 846 thousand CZK
In the period of 1/1/2006 to 31/12/2006 the tangible fixed assets in an amount of 22,215 thousand CZK were sold off. The biggest item
was the sale of the equipment for circumferential welding in an amount of 610 thousand EUR, which means 17,220 thousand CZK,
leased by the company by the form of financial leasing; then the store hall was sold off in an amount of 3,979 thousand CZK. Net book
value of the sold-off assets was 18,287 thousand CZK, from which the most significant amount represents the sale of the equipment for
circumferential welding leased by the company by the form of financial leasing. The assets of total acquisition price of 8,957 thousand
CZK were scrapped. Net book value of the scrapped assets in an amount of 31 thousand CZK was covered by the adjustment which was
dissolved into revenues at the same time.
5. Low-value tangible and intangible fixed assets
In accordance with the accounting procedures specified under Item 2 (a), the company expenses low-value tangible and intangible assets
in the year in which they are purchased or consumed. The total accumulated acquisition prices of the low-value tangible and intangible
assets that are still in use and recorded in sub-ledger accounts are the following:
Data in thousands of CZK
31/12/2006
Low-value intangible fixed assets (software)
31/12/2005
3,747
3,329
Fixtures and fittings
26,062
26,367
Models (incl. models registered in TFA)
96,796
103,733
Agents
74,934
71,581
Tools
60,367
56,404
Total
261,905
261,414
6. Long-term financial assets
Shares
Acquisition
price
Currency
* Value share
in equity
*Total pre-tax
Book value
Book value
profit
at 31/12/2006 at 31/12/2006
at 31/12/2006
Shares in operated and controlled entities
In thousands of CZK
ZPA Moravia s.r.o.
35 %
70,000
CZK
108
104
70
70
MSA Slovakia s.r.o.
100 %
500,000
SKK
-858
-930
399
383
Opravárenský závod MSA, s.r.o.
70 %
7,476,000
CZK
11,234
1,302
7,476
7,476
BULTRADE MSA, Ltd., Sofie
66 %
9,030
USD
**
-547
189
222
8,134
8,151
Total
Shares in accounting entities under majority influence
„LOZNICA-GAS“ A.D. Loznica
20 %
In thousands of CZK
2,000
USD
9,092
Total
503
42
49
42
49
* Data comes out from non-auditive results at 31/12/2006.
** Value is not known at the date of the compiling of the appendix.
/ A N N UA L R E P O RT 2 0 0 6
page 31
Financial
part
Adjustments to shares
31/12/2006
31/12/2005
ZPA Moravia s.r.o.
MSA Slovakia s.r.o.
0
0
399
0
0
0
189
0
Total
33
0
621
0
The company had the revenues from the title of received dividend in an amount of 700 thousand CZK from Opravárenský závod
MSA, s.r.o. in 2006.
Registered offices of the affiliated companies:
ZPA MORAVIA s.r.o., Hlučínská 41, Dolní Benešov, post code: 747 22, Czech Republic
Opravárenský závod MSA, s.r.o., Hlučínská 41, Dolní Benešov, post code: 747 22, Czech Republic
BULTRADE MSA Ltd. Sofie, ul. Kozloduj 20-28, bl. 5, Bulgaria
„LOZNICA-GAS“A.D. Loznica, ul. Vere Blagojevič b. b., Serbia and Montenegro
MSA Slovakia s.r.o., Hurbanovo nam. 3, Bratislava, post code: 811 06, Slovakia
7. Inventory
An analysis (based on a physical stocktaking carried out at 31/12/2006) of inventory and adjustments to them was performed. Adjustments at the date of the Financial Statement are follows:
Adjustments to inventory
31/12/2006
Adjustments to stock material
31/12/2005
4,751
Adjustments to semi-finished products of own production
5,423
122
103
Adjustments to work-in progress
11,005
4,507
Adjustments to products in stock
18,371
3,290
1,042
1,042
35,291
14,365
Adjustments to merchandise in stock
Adjustments to inventory - total
The creation of adjustments within the range of 9.83% to total inventory covers potentional devaluation of inventory, including known
and expected risks and losses.
8. Trade receivables, trade payables and other receivables and payables
(a) Total value of short-term and long-term receivables from trade relationships, excluding advance payments paid, is 530,390 thousand
CZK (at 31/12/2005 the value was 231,564 thousand CZK), of which other receivables represent 364 thousand CZK from total value.
The adjustment in an amount of 2,815 thousand CZK was created for the receivables from current trade relationships in an amount
of 530,390 thousand CZK, from which the amount of 6,998 thousand CZK is overdue more than 180 days. The receivables from trade
relationships in an amount of 130,584 thousand CZK have been pledged for the benefit of ČSOB, a.s. and the amount of 87,472
thousand CZK for the benefit of VOLKSBANK CZ, a.s. as a security for loans. The receivables in an amount of 33,035 thousand CZK
have been pledged for the benefit of Raiffeisenbank, a.s. as a security of production financing.
(b) Short-term payables from the trade relationships excluding advance payments paid are 240,374 thousand CZK in total
(at 31/12/2005 they were 252,918 thousand CZK). Other payables represent the value of 582 thousand CZK. Short-term
payables from current trade relationships are 238,968 thousand CZK. The company records no payables overdue more than 180 day
by 31/12/2006.
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Financial
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(c) The other short-term and long-terms receivables are recorded in an amount of 64,967 thousand CZK (at 31/12/2005 it was 36,192
thousand CZK) and particularly include receivables in respect of an excessive value added tax deduction, advance payments paid,
estimated receivables and other receivables. Other receivables particularly consist of those from bankrupt companies such as
SEZOOZ OIL, a.s. Zlín for which the company has made 100 % adjustments, as well as the receivable from the company TRANSFI
NANCE, a.s., in respect of transfer of receivables from the State within a factoring financing and receivables from foreign companies
in respect of securing foreign trade transactions.
The most significant item shown in other receivables is valuation of derivates for which derivates contract was made with ČSOB, a.s.
with settlement dates in 2007. According to expert opinion, these contracts are of hedging derivate character and their real value
was evaluated as a receivable in an amount of 32,224 thousand CZK at 31/12/2006 (at 31/12/2005 the value of receivables was in
an amount of 3,183 thousand CZK and payable was in an amount of 4,632 thousand CZK). In accordance with item 2 (f), these
derivates were treated as derivates held for trading.
(d) The other short-term payables of the company in an amount of 65,629 thousand CZK (at 31/12/2005 the short-terms payables were
45,184 thousand CZK) include payroll payables, social security and health insurance payables, payables to the State, estimated
payables, advance payments received and other payables – e.g. in respect of life insurance and supplementary pension insurance.
9. Adjustments
Adjustment
to long-term
financial
assets
Adjustment
to TFA
Adjustment to
trade receivables, including advance
payments
Adjustment
to inventory
Total
24,039
0
14,365
Creation from 1/1/2006 to 31/12/2006
0
621
27,913
2,266
0
30,800
Clearing from 1/1/2006 to 31/12/2006
-1,211
0
-6,987
-4,818
-450
-13,466
22,828
621
35,291
2,928
9,011
70,679
5,480
Adjustment
to other
receivables
9,461
53,345
10. Reserves
Reserve for
warranty
repairs
Reserve for
unsettled
proceedings
Reserves for
conventional
fines not yet
invoiced
Reserve for
severance
payments
2,768
0
Creation from 1/1/2006 to 31/12/2006
5,182
Clearing from 1/1/2006 to 31/12/2006
-2,768
5,182
Reserves for
exchange rate
losses
Total
0
1,100
0
3,868
0
3,915
10,021
-
19,118
-
-3,915
-1,100
-
-7,783
0
0
10,021
0
15,203
11. Share capital
The company’s registered (authorised) capital in an amount of 23,019,480 CZK is made up of 1,534,632 bearer ordinary shares of nominal
value of 15 CZK per each, issued in form of certificates. The company has a principal shareholder – the company MSA Holding, a.s.
/ A N N UA L R E P O RT 2 0 0 6
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Financial
part
12. Equity
(a) Overview of equity movements
Trading income
Registered
capital
Statutory
reserve fund
Current period
Previous years
55,599
49,537
-55,599
55,599
0
-12,814
-12,814
23,019
Accounting for profit for 2005
Dividend payout
Trading income of 2006
100,986
Capital funds
224,478
14,353
23,019
453,619
14,353
Valuation differences for 2006
Total
14,353
92,322
100,986
945
945
225,423
456,103
The changes in equity influenced the result of trading income of 2006 and valuation differences of the subsidiary companies in course of
the period from 1/1/2006 to 31/12/2006.
Dividends in an amount of 12,814 thousand CZK were paid off to the only shareholder of MSA Holding, a.s. in 2006.
13. Bank loans
(a) Credit limit amounts – short-term credits
Credit provider
ČSOB, a.s.
Raiffeisenbank, a.s.
Volksbank CZ, a.s.
Limit amount
Credit limit purpose
484/04/09118
485/04/09118
513/04/09118
170 mil. CZK
98.5 mil. CZK
Not fixed
✔
152554/01/05
160 mil. CZK
✔
152554/01/06
160 mil. CZK
Contract
termination
date
Balance at
31/12/2006
in thous. CZK
120 mil. CZK; receivable financing
50 mil. CZK; financing of inventory
✔ 98.5 mil. CZK; letters of credit and bank’s guarantees
✔ 15 mil. CZK; foreign exchange transactions
14/9/2007
14/9/2007
14/9/2007
unlimited
120,000
50,000
42,543
0
50 mil. CZK; short-term fixed credits - financing
of inventory
✔ 30 mil. CZK; bank overdraft - financing of inventory
✔ 80 mil. CZK; financing of production + 18 mil. CZK not
included into the limit amount
✔ 80 mil CZK; bank’s guarantees and letters of credit
✔ general treasury contract
31/7/2007
50,000
✔
30,000
82,898
150
31/07/2007
3 mil. EUR
✔
3 mil. EUR; bank overdraft – financing of production
30/09/2007
73,482
3.5 mil. EUR
✔
3.5 mil. EUR; bank’s guarantees and letters of credit
30/09/2007
48,855
1 mil. EUR
✔
1 mil. EUR; treasury limit
Till 1 year
Total
497,928
Bank loans:
406,380
Bank’s guarantees:
91,548
The company had passive balance at current account in an amount of 1,048 thousand CZK at 31/12/2006. Total limit amount of the shortterm loans is 407,428 thousand CZK.
page 34
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Financial
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Securing of bank credits:
ČSOB, a.s.
✔ contract of bailment – receivables in an amount of 130,584 thousand CZK
✔ contract of bailment – real property in an amount of 168,831 thousand CZK
✔ contract of fulfilment of exchange law - 3 blank bills
Raiffeisenbank, a.s.
✔ contract of bailment – time deposit to bank’s guarantees in an amount of 38 thousand CZK
✔ contract of conveyance of owner’s right – reserves in an amount of 378,017 thousand CZK
✔ contract of fulfilment of exchange law - 3 blank bills
Volksbank CZ, a.s.
✔ assurance contract of assignment of receivables – receivables in an amount of 87,472 thousand CZK
✔ contract of bailment – time deposit to bank’s guarantees in an amount of 9,504 thousand CZK
✔ contract of conveyance of owner’s right – inventory in an amount of 10,833 thousand CZK
✔ contract of multifunction line – 2 blank bills
(b) Long-term bank credits received
ČSOB, a.s.
Total credit
amount
Credit drawing
and repayment
Quarterly
payment
Credit due date
Balance in thousands of CZK
1,725,000 USD
quarterly
115,000 USD
30/9/2010
36,011
Securing of bank credits:
ČSOB, a.s.
✔ contract of bailment – real property in an amount of 168,831 thousand CZK
✔ contract of bailment – stocks and shares (41 % bearer ordinary shares of MSA, a.s.)
(c) Regulation criteria bank credit drawing for 2006
ČSOB, a.s.
Limit
Real state for 2006
Adjusted equity ratio
> 45 %
37 %
Current ratio
> 50 %
73 %
Return on sales
> 1.5 %
1.1 %
Limit
Real state for 2006
Equity ratio (%)
> 35 %
37 %
Volksbank, a.s.
Limit
Real state for 2006
Share of equity on total liabilities
> 35 %
37.3 %
Return on sales
> 2.5 %
2.4 %
Raiffeisenbank a.s.
The creation of adjustments to assets, inventory and receivables had the main influence on nonfulfilment of regulation criteria, which
were defined by banks, in 2006.
/ A N N UA L R E P O RT 2 0 0 6
page 35
Financial
part
(d) Influence of estimated merger on indebtedness of the company
In compliance with supposed decision of the only shareholder about the merger of the company MSA, a.s. with the companies MSA
Holding, a.s. and ASM Holding, a.s. with record date of 1st April 2007 (see point 24 of the appendix for the special financial statement),
the significant increase of share of foreign resources on the total financing of the company MSA, a.s. is supposed in consequence of the
devolution of credit payables of the company ASM Holding, a.s. to MSA, a.s.
(e) Factoring
Besides the bank loans received, the company particularly uses the services of the factoring company TRANSFINANCE, a.s. to funds its
operation. Debts are funded under a “Book and Bill Receivable Factorind Agreement” date 27th December 2002 and schedules to the
Agreement. Possible obligations occurred on the side of MSA, a.s. are secured by a blank bill issued under the Factoring Agreement and
an Agreement on the Authority to Make out Bills of Exchange.
14. Product range information
Revenues from ordinary activity were formed as following:
2005
2006
Business activity I
- valve production, work related to the production
- abroad
- domestic
Total
Business activity II
- heat production, compressed air production, electric power distribution, waste disposal, water distribution, housing economy, development
works, property leases and transport
- abroad
- domestic
Total
Business activity III
- sale of merchandise
865,457
178,282
1,584,248
1,043,739
16,186
33,117
14,061
31,114
49,303
45,175
- abroad
- domestic
84,913
2,343
39,118
2,093
87,256
41,211
- abroad
- domestic
1,604,985
115,822
918,740
211,489
1,720,807
1,130,125
Total
Total incomes I – III
1,503,886
80,362
Total
15. Employees and officers
Average number of employees and officers and personal expenses:
Number
of employees by date
Social security and
health insurance
expenses
Social expenses
31/12/2006
2006
2006
2006
585
141,565
49,464
5,834
Employees
Officers
5
8,062
2,822
87
590
149,627
52,286
5,921
31/12/2005
2005
2005
2005
543
116,237
39,747
3,590
6
6,931
2,425
32
549
123,168
42,172
3,622
Total
Employees
Officers
Total
page 36
Wages and salaries
incl. other personal
expenses
/ A N N UA L R E P O RT 2 0 0 6
Financial
part
In the period from 1/1/2006 to 31/12/2006 the company paid board member compensations in an amount of 3,880 thousand CZK.
Social expenses include pension contribution for founders, allowance for canteen meals, allowance for contributory pension schemes of
employees, expenses for physiotherapy, allowance for supplementary pension insurance and life insurance. Social security and health
insurance liabilities, totalling 4,966 thousand CZK at 31st December 2006, which the company pays for the employees, were paid by the
end of January 2007.
Except for payroll payables for December 2006, the company has not registered at 31st December 2006 any wages and salaries unpaid
to its employees for the past period.
16. Information on related parties
(a) Trade receivables and payables
The trade receivable and payable specified under item 8 include the following account balances connected with relationships to companies in the group and between related parties.
Receivables
31/12/2006
Payables
31/12/2005
31/12/2006
31/12/2005
ZPA Moravia s.r.o.
182
150
18
8
MSA Slovakia s.r.o.
894
18,091
-
-
-
-
6,695
3,590
459
-
7
-
963
1,016
-
-
Ing. Karel Ren, Csc.
-
-
6
7
Stephen Lukas
3
-
19
6
MSA Holding, a.s.
4
4,184
-
-
MSA-KTS
16,782
-
3,126
-
Total
19,287
23,441
9,871
3,611
(b) Expenses and revenues
Company expenses
2006
ZPA Moravia s.r.o.
Company revenues
2005
2006
2005
198
27
-
-
-
-
16,493
15,747
1,898
897
7
-
629
5,480
-
-
-
1,039
Ing. Karel Ren, Csc.
130
156
259
-
Stephen Lukas
730
897
3
-
MSA Slovakia s.r.o.
MSA Holding, a.s.
MSA-KTS
Total
456
188
-
2,926
-
626
3,197
-
24,329
-
20,755
19,753
27,574
8,215
The most important item in respect the company’s expenses charged by Opravárenský závod MSA, s.r.o. includes costs for a repair of
tangible assets. The revenues invoiced by the company to this subsidiary company are particularly made up of heat supplies, transformer
station services and other services provided.
/ A N N UA L R E P O RT 2 0 0 6
page 37
Financial
part
The delivery of valves and related services were charged to the subsidiary companies BULTRADE MSA Ltd. and MSA-KTS, the rent of the
compressed mill, usage of water, electricity, gas, phone charges were charged to the company ZPA Moravia s.r.o., the instalments of leasing contracts were charged to Ing. Karel Ren, CSc. and phone services were charged to Mr. Stephen Lukas.
(c) Board member compensation
Board of Director
Number of members
Compensations
Supervisory board
2006
2005
2006
2005
3
3
6
3
3,268
780
612
480
The members of the Board of Directors and the Company Management use company cars also for business as well as private purposes.
The board members did not have any obligations to the company in respect of a loan provided by the company, at the Financial Statement
date.
17. Income tax
(a) Tax due
Calculation (estimate) of tax for period
Assessment
Actual fact
2006
05/04 – 12/05
Profit before taxation
14,353
55,599
Tax non-deductibles (+)
75,199
128,381
Tax deductible (-)
-9,821
-79,135
Tax base
79,731
104,845
Tax loss deduction pursuant to Section 34, Clause 1,of the Income
Tax Act
-79,731
-104,845
Deduction of 10 % TFA according to Section 34, Clause 3,
of the Income Tax Act
0
0
Deduction of other items
0
0
Income tax base
0
0
24 %
26 %
0
0
Tax rate
Income tax
In the tax period of 2006, the most important non-deductible items were the creation of reserves and adjustments which are not an
expense for achieving, providing and maintaining incomes in accordance with the Income Tax Act No. 586/1992 of the Czech Code
Collection.
On other hand the most significant deductible items created in past periods were the dissolutions of reserves and adjustments.
The biggest deductible item was the difference of book and tax depreciations in an amount of 14,780 thousand CZK.
page 38
/ A N N UA L R E P O RT 2 0 0 6
Financial
part
(b) Deferred tax
Recorded deferred tax receivables and payables
Receivables
2006
Difference between net book value and tax remaining value
-
Receivables in respect of conventional fines
-
Payables in respect of conventional fines
Payables
5/2004 – 12/2005
2006
5/2004 – 12/2005
-
-318
-4,040
-
-29
-873
36
435
-
-
Adjustments to assets
5,479
5,769
-
-
Adjustments to inventory
8,470
3,448
-
-
-
-
-
-
3,649
928
-
-
14,520
35,359
-
-
Adjustments to receivables
Reserves
Losses of previous years
Non-applied deduction of 10 % in respect of tangible fixed assets
Deferred tax receivable/payable
Compensation for related deferred receivables and payables
Deferred tax receivable
892
895
-
-
33,046
46,834
-347
-4,913
-347
-4,913
-
-
32,699
41,921
-
-
In accordance with the accounting procedures specified under item 2 (i), the tax rate of 24 % was used to calculate the deferred tax.
The deferred tax receivable in an amount of 32,699 thousand CZK was not recorded because there had been doubts about its possible
exercise in the current and the following accounting periods.
18. Leases
(a) Financial Lease
The company has held long-term assets under financial leases which are recorded in operational documentation.
List of assets held under financial leases by the company at 31st December 2006 (in CZK):
Value (excl. VAT)
of the object,
excluding the
profit margin of
leasing company
(passenger cars
incl. VAT)
Horizontal machining centre HCFH
Machining centre – milling cutter FSQ
Welding equipment for tiny spaces (Oerlikon)
High-lift truck
Vehicles
Total
Sum of leasing
payments over
the whole period
of the lease
expected
Leasing payments
actually paid at
31/12/2006
11,296,000
13,946,300
17,381,950
3,566,266
5,323,534
15,586,504
18,572,712
22,933,451
4,842,704
6,564,400
11,095,906
3,714,500
2,293,345
308,278
3,476,084
4,490,598
14,858,212
20,640,106
4,534,426
3,088,316
51,514,050
68,499,771
20,888,113
47,611,658
Remaining
payments at
31/12/2006*
* The amount of 13,469,716 CZK is due till 1 year from the amount of 47,611,658 CZK and the rest of the amount is due in following years.
The payables towards the company ČSOB Leasing, a.s. in respect of providing of the financial leasing for machining centres and welding
equipment for tiny spaces are secured by blank bills from the side of the leasing company.
The leasing in an amount of 9,679 thousand CZK was charged into expenses in 2006.
/ A N N UA L R E P O RT 2 0 0 6
page 39
Financial
part
(b) Other Leases
Total expenses regarding to other leases, including operating leases, are 2,801 thousand CZK. It represented especially operating leasing
of copying machines and printers and the rents of flats.
19. Other receivables and payables not included in the balance sheet
Bank guarantees provided (thousands of CZK)
Securing Value
Amount of guarantee
provided
Time deposit
Other
5,929
1,186
EGAP
Total VÚB, a.s.
15,685
3,137
EGAP + 1 blank bill
Total Commerzbank
10,482
1,098
EGAP
Total ČSOB, a.s.
42,543
-
1 blank bill
150
38
1 blank bill
Total Volksbank CZ, a.s.
48,855
9,504
EGAP + 2 blank bills
Total ČEB, a.s.
21,702
2,170
EGAP + 3 blank bills
Total ČS, a.s.
3,193
-
EGAP
148,539
17,133
-
Total Bawag International Bank CZ, a.s.
Total Raiffeisenbank, a.s.
Total
20. Assets of market value highly exceeding book value
The company only possesses assets purchased after termination of leasing contracts, which are recorded as tangible fixed assets at purchase price according to respective leasing contract.
The most significant items are as follows:
Description
page 40
Acquisition price according to
Lease Contract (CZK)
Book Value (CZK)
Passenger car Škoda Octavia OPN 45-75
119
578,989
119
543,050
119
284,900
119
284,900
119
543,050
119
543,050
119
284,900
Lorry Seat 1T0 8047
100
324,900
Passenger car Škoda Octavia OPM 32-49
122
578,000
Passenger car AUDI All Road 4.2 1T9 67-77
100
1,685,351
Trailer Jungheinrich EFC-Vac 30
100
684,900
Mobile drive-up ramp MR-9000
100
348,750
/ A N N UA L R E P O RT 2 0 0 6
Financial
part
21. Files of financial devices (for the purpose of cash flow)
The company formulated the statement of cash flow with the usage of indirect method. The financial devices and equivalents of the survey about cash flow are represented by the money, which are mentioned on the line C.IV.1 in the Balance Sheet, and the bank accounts,
which are mentioned on the line C.IV.2 in the Balance Sheet.
by 31/12/2006
Balance in cash and mail-float time money
Postage stamps
by 31/12/2005
142
186
0
0
Bank accounts
32,363
28,898
Total
32,505
29,084
22. Special trading income
The expenses regarding past years are charged in the special expenses.
The revenues regarding past years are also charged in the special revenues. The most significant amount is No. 24-2034, invoice issued in
2005, and No. 60053905 in an amount of 1,309,064 USD (27,328 thousand CZK), on the customer ZAO “OMZ-NEMO”. The agreement
about storage was also issued with the invoice in terms of which the products of customer were laid to store of MSA, a.s. However the
customer refused to accept the products in 2006. The credit note was issued on the basis of the information, which influenced the special
trading income. On the proposal of the auditory company, these products were transferred into work-in progress production in an amount
of 11,345 thousand CZK and relevant adjustment was created in an amount of 11,005 thousand CZK.
23. Other important events
By the virtue of the decision of the only shareholder, the merger of the companies MSA, a.s., MSA Holding, a.s. and ASM Holding, a.s. will
be reached with record date of 1st April 2007. In consequences of the decision, the Special Financial Statement will be compiled by 31st
March 2007 for the period from 1st January 2007 to 31st March 2007.
/ A N N UA L R E P O RT 2 0 0 6
page 41
Financial
part
Report
of the company statutory body
compiled in compliance with the article section 66a) of the commercial code
SECTION I.
ENTITIES CREATING HOLDING
Controlled Company
Company: MSA, a.s.
Registered office: Hlučínská 41, Dolní Benešov, post code 747 22
IN: 451 92 278
Registered in Companies Register at Regional Court in Ostrava, section B, insert 388
Statutory body at 31st December 2006:
- Ing. Jozef Leščišin, the Chairman of the Board of Directors
- Valery Nikolaevich Shipilov, the member of the Board of Directors
- Ing. Karel Ren, CSc., the member of the Board of Directors
(further as “controlled company”)
The company MSA, a.s. is the company of the only shareholder at 31st December 2006.
Partner
Registered office
Share
MSA Holding, a.s., IN: 274 15 716
Praha 1, Olivova 4/2096, post code 110 00
100 %
Controlling Companies:
In compliance with the Article Section 66a) and 66b) of the Commercial Code, the controlling companies are following:
- MSA Holding, a.s., registered office: Žerotínova 35, Praha 3, post code 130 00
- ASM Holding, a.s., registered office: U Svobodárny 1065/2, Praha 9, post code 190 00
- BTM Holdings B.V., registered office: Saturnusstraat 25 i, Hoofddorp HB, post code 2132, the Netherlands
- Ing. Karel Ren, CSc., address: Lotyšská 648/4, Praha 6, post code 160 00
- Stephen Lukas, address: R.R.2, P.O.BOX 520, Harrow, Ontario, Canada
SECTION II.
DETERMINATION PERIOD
The report is compiled for the previous accounting period form 1st January 2006 to 31st December 2006.
page 42
/ A N N UA L R E P O RT 2 0 0 6
Financial
part
SECTION III. CONTRACTS AND AGREEMENTS CONCLUDED BETWEEN THE CONTROLLING COMPANIES AND THE CONTROLLED COMPANY
List of contracts valid in the determination period (concluded in the determination period or in previous periods):
Contract: LEASING CONTRACT REGARDING CHANGE OF OBJECT
Title of contract: Leasing Contract Regarding Change of Object
Contracting parties: MSA, a.s. / ČSOB Leasing, a.s. / Ing. Karel Ren, CSc.
Object of contract: passenger car AUDI A2, 4T0 7777
Payables to MSA, a.s. resulting from contract: To hand over the object of the leasing contract.
Payables to Ing. Karel Ren, CSc. resulting from contract: To pay negotiated amount.
Detriment of the controlled company: No detriment arose from above mentioned contract to the controlled company.
Contract: LEASE CONTRACT OF A PART OF FLAT
Title of contract: Lease Contract of a Part of Flat
Contracting parties: Landlord: Stephen Lukas, Tenant: MSA, a.s.
Object of contract: Lease of a part of flat as an office of the company MSA, a.s.
Period of execution of leasing contract: from 1/1/2006 to 31/12/2006
Payables to MSA, a.s. resulting from contract: To pay negotiated amount of lease.
Payables to Stephen Lukas resulting from contract: To provide a part of flat (by leasing).
Detriment of the controlled company: No detriment arose from above mentioned contract to the controlled company.
Others: The controlling company has rendered 41 % of shares of the company MSA, a.s. as the security of long-term bank credit
provided by ČSOB, a.s. to MSA, a.s.
SECTION IV. CONCLUSION
The Report was compiled by the Statutory Body of the controlled company MSA, a.s. at 25th May 2007.
Prague, 25th May 2007
The signatures of the Statutory Body of the controlled company MSA, a.s.
/ A N N UA L R E P O RT 2 0 0 6
Ing. Ivana Hamerková
page 43
Financial
part
Report
of an independent auditor
page 44
/ A N N UA L R E P O RT 2 0 0 6
Financial
part
/ A N N UA L R E P O RT 2 0 0 6
page 45
Financial
part
The Report
of the Supervisory Board
THE REPORT OF THE SUPERVISORY BOARD ON THE SUPERVISORY BOARD´S OPERATION FROM 1st JANUARY 2006 TO 31st DECEMBER 2006,
ON THE REVIEW OF ORDINARY FINANCIAL STATEMENT AND THE SUPERVISORY BOARD´S OPINIONS ON THE AUDITOR´S REPORT AND THE
PROFIT DISTIBUTION PROPOSAL SUBMITTED BY THE BOARD OF DIRECTORS.
The Supervisory Board from 1st January 2006 to 31st December 2006 was composed by: Mr. Stephen Lukas – Chairman of the Supervisory
Board, Ing. Pavol Peťko and Leo Stařinský.
On the basis of the decision of the only shareholder by 1st August 2006, Mr. Stephen Lukas was repealed from the position of the Chairman
of the Supervisory Board and Ing. Pavol Peťko was repealed from the position of the member of the Supervisory Board. On the basis of the
change of the Articles of Association and an extension of the members of the Supervisory Board up to 6 members, Stephen Lukas, Sergey
Igorevich Moiseyev, Viktor Mikhailovich Fedotov and Vladimir Viktorovich Khristenko were appointed to the position of the members of the
Supervisory Board, and Mr. Leo Stařinský has remained the member of the Supervisory Board. The election of the member of the Supervisory
Board suggested and elected from the employees took place in the days of 12th and 13th September 2006, Mr. Miloslav Sonnek was elected
as the member of the Supervisory Board. Mr. Vladimir Viktorovich Khristenko was elected as the Chairman of the Supervisory Board by the
Supervisory Board itself at 21st September 2006. The Supervisory Board worked in this composition till 31st December 2006.
In the course of 2006 the Supervisory Board met 8 times, all meetings were common together with the Board of Directors. The Supervisory
Board dealt especially with the Trading Incomes of the company, the issue of production strategy, it also discussed the changes of company
organizational structure, personnel questions and the plan preparation for the forthcoming year.
The Supervisory Board executed its objectives in compliance with the Act and Articles of Association. The Supervisory Board monitored
especially pursuit of activities of the Board of Directors and the manner of the company management. The Board of Directors of the company
MSA, a.s. regularly informed the Supervisory Board about the company activity, the financial condition and provided all required information.
The Supervisory Board did not find any deficiencies in the performance of the Board of Directors and in the company’s business activity.
The Supervisory Board met with the Financial Statement on its meeting at 19th April 2007, which was audited by the company AUDIT PLUS, s.r.o.
In opinion of the auditory company, the Financial Statement gives true and fair view of assets, liabilities and financial condition of the company MSA, a.s. at 31st December 2006 and view of expenses, revenues and trading income of 2006 accordance with Czech Book Regulations.
The Supervisory Board accepted the conclusions of the audit, agrees with the Annual Report of MSA, a.s. for 2006, and recommends the
Meeting of Shareholders grant approval for the reported position of assets, liabilities and equity as well as the amount of Trading Income and
its distribution for the period from 1st January 2006 to 31st December 2006 according to the proposal submitted by the Board of Directors.
The Supervisory Board recommends the only shareholder of the company MSA, a.s.
-
Approve the regular Financial Statement for the period form 1st January 2006 to 31st December 2006.
-
Transfer, within an approval process, of Trading Income for the period form 1st January 2006 to 31st December 2006 in an amount
of 14,353,102.15 CZK from the Trading Income account to the account of retained earnings of previous years.
Approved by the Supervisory Board on 22nd June 2007.
Vladimir Viktorovich Khristenko
Chairman of the Supervisory Board
page 46
/ A N N UA L R E P O RT 2 0 0 6

Annual Report 2006

Transcription

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