Annual Report

Annual
Report
Albrecht Dürer, Knight and Landsknecht
Woodcut: 38.7 x 27.3 cm
2001
02-001 Warsaw, Aleje Jerozolimskie 81,
Phone (+48 22) 607 10 00
Customer Service Office: phone (+48 22) 607 16 01
Commercial Information: phone 0 800 601 601
Internet: http://www.plusgsm.pl
Annual Report
2001
Albrecht Dürer (1471–1528), German artist, the
most recognised painter of the Northern Renaissance. Apart from painting, his vast body of
interest included art theory, printmaking and
drawings. Dürer was one of the first artists in
Northern Europe who applied the achievements of
the Italian Renaissance in the Dutch realism and
German tradition of art, thus creating his unique,
uniform style. Dürer was the first artist who used
all techniques of making prints known at that time.
His engravings, dry-points and etchings created
new path in the art of engraving. Thanks to the
plenitude of content, innovativeness of form and
mastery of technique, he developed and propagated
the printmaking, the art which was young and little
popular at those times.
Dürer put a lot of attention to provide German
artists with theoretical grounds – he thoroughly
studied the geometrical perspective and proportions
of human body. The studies resulted in his Treatise
on Measurement with Compass and Ruler in
Lines, Planes and Whole Bodies, issued in
1528. In his artistic work, Dürer also improved
the technique of woodcut, and his most outstanding
achievement in this field, known as the Master
Engravings, were Knight, Death and Devil
(1513), St. Jerome in his Study (1514) and
Melencolia I (1514), where Dürer expressed his
views on life. He was named the ”Apelles of black
lines” by his contemporaries, which is a proof of
their admiration for his printmaking work and
understanding of its significance. Next generations
of artists were under influence of his style,
technique, compositions and themes. Currently the
National Museum of Warsaw hosts one of the
greatest collections of the prints of Albrecht Dürer.
Annual Report
2001
TABLE OF CONTENTS
Financial Highlights
3
Letter from the President of the Management Board
4
Management Board
6
Supervisory Board
6
Shareholders
6
Polish Mobile Telephony Market in 2001
7
Polkomtel S.A. on the Mobile Telephony Market
8
Key Events
9
Customer Service
10
Employees
11
New Services and Innovations
12
Operating Results
18
Investments in the Network Expansion
19
Financial Results
20
Financial Report
23
Company as a Corporate Citizen
33
Prizes and Awards
35
Wentzel Hollar, Albrecht Dürer’s Self-Portrait, 1645
Etching, 22.9 x 16.5 cm
After the self-portrait of Albrecht Dürer, painting, 1498
Financial Highlights
3
LETTER FROM THE PRESIDENT OF THE MANAGEMENT BOARD
Dear Ladies and Gentlemen,
In 2001, Polkomtel S.A. recorded the highest operating and financial profit
in its history. The rising subscriber base, sales revenue, and profit serve as
proof of our yet another success in harnessing the opportunities created by
the rapidly expanding market of wireless telephony. Recently the growth
rate has slumped slightly but the market continues to foster possibilities for
dynamic development, which is attested to by the fact that as at the end of
the year, we had 3.44m users, that is by 40% more than in 2000.
As we work to expand our customer base, we continue to be mindful of our
obligations towards those who finance our activities – the Shareholders. We
are creating Company value by generating regular streams of profit and
revenue. In 2001, we were Poland’s most profitable wireless telephony
operator, with a net profit of PLN 591m, almost thrice the profit realised in
2000. The EBITDA of PLN 1.5bn was also record-breaking. The Company
was able to achieve such results thanks to the proper cost management,
particularly in relation to financial expenses. Thanks to support on the part
of our Shareholders, we are able to obtain the funds required for
development at a lower cost than if we relied on external sources. The key
factor in our successful performance in terms of revenues is the loyalty of
our customers, who generate the highest APRU (average revenue per user)
on the market. Analysts and rating agencies have appreciated the
Company’s low indebtedness and its effective capital management by
awarding high scores to our operating activity.
Without a doubt, 2001 was the year of rapid rise in popularity of all types of
non-voice services, in particular, of the short message system (SMS).
Together with our business partners we have begun to introduce valueadded services related to information, location-based, entertainment, and
mobile e-commerce solutions. We consider these services and the
expenditure made on the GPRS system as a preparation for third-generation
telephony services. In order to prepare customers to the new phase of
market development, we have implemented a number of new services
4
including fixed-mobile integration services, and location-based services
which provide the user with access to detailed information on the nearest
ATM, service station or cinema.
The Plus GSM network incurs high capital expenditure. To date, the aggregate
value of Polkomtel S.A.’s investments amounts to PLN 4.9bn, out of which
close to PLN 940m was spent last year. This expenditure is allocated for
network development and launch of new services. In 2001, Polkomtel S.A.
– as the first in Poland and as one of the first in the world – implemented
CAMEL technology, a component of third-generation mobile telephony
systems. We have also expanded the application of the SIM Toolkit
technology, which provides users with easier access to various news services.
The quality of these technologies has improved materially following the
completion of investments in the development of a backbone network,
which increased line throughput and transmission speed.
Polkomtel S.A.’s forecasts for the immediate future provide for a continued
rise in the number of network users, who will be using an increasingly broad
offering of services. The time and procedure of implementation of thirdgeneration telephony will be the factors of greatest bearing on the overall
situation on the Polish mobile telephony market. I am convinced that
thanks to our unyielding focus on the introduction of new services and
investments in network development, we are well positioned to meet the
demands of the market.
President of the Management Board
Polkomtel S.A.
5
Management
Board
(as of December 31st, 2001)
Marek Mroczkowski – President of the Management Board, General Director
Wojciech Pytel – Director of Operations
Krzysztof Żmijewski – Human Resources Director
Władysław Wilkans – IT Director
Jesper Helmuth Larsen – Financial Director
John Treuge – Technical Director
Lars Andersen – Marketing Director
Supervisory
Board
(as of December 31st, 2001)
Andrzej Modrzejewski – Chairman
Andrzej Herman – Member
Marian Krzemiński – Member
Ireneusz Reszczyński – Member
Jesper Theill Eriksen – Member
Thomas Andresen – Member
Peter Walz – Member
Jürgen von Kuczkowski – Member
Shareholders
Węglokoks S.A.
4.00%
Tel Energo S.A.
1.01%
TelBank S.A.
0.50%
Polskie Sieci
Elektroenergetyczne S.A.
16.05%
Polski Koncern
Naftowy ORLEN S.A.
19.61%
KGHM Polska
Miedź S.A.
19.61%
Tele Danmark A/S
19.61%
Vodafone Americas
Asia Inc.
19.61%
6
POLISH MOBILE TELEPHONY MARKET IN 2001
The year 2001 was the sixth consecutive year when the number of subscribers of wireless
telephony grew. Despite Poland’s difficult economic situation, which translates into
households’ lower disposable income, demand for mobile telephony, measured by the
number of new users, continues to grow. As at the end of the year, over 10 million Poles – that
is more than 3.26m more than a year before – were using wireless phones. The penetration
ratio (number of wireless phones per 100 residents) stands at 26% compared to 17% at the
beginning of 2001. A comparison with the penetration ratio of fixed-line telephony –
approximately 30% – shows that the moment when the number of persons using mobile
phones will exceed the number of fixed-line telephony users is near.
As the number of users of wireless telephony is steadily growing, the market’s growth rate is
falling: from 71% in 2000 to 48% in 2001. Operators are deriving less revenue on new
customers due to the increasingly popular pre-paid services – last year 70% of the new
customers purchased pre-paid telephones.
Faced with the trying economic conditions, the mobile telephony operators strived to
optimise the capital expenditure incurred on development of the infrastructure and on
marketing. They competed by extending their offerings, by applying competitive pricing
policies, and by establishing an image of attractive and reliable partners in business and
everyday life. The operators focused on the quality of the provided services and on activities
designed to minimise customer churn. Ideas to keep customers loyal included replacement of
used terminals with new ones, introduction of new, cost-optimising tariffs, and launching
increasingly popular loyalty schemes consisting in accumulating points redeemable for
prizes.
In 2001, the operators launched the first location-based service and noted significant rise in
interest in audio and text services. With the use of SMS-based solutions, customers were
Market Shares of Individual Mobile Telephony Operators (number of customers)
Polkomtel S.A. - Plus GSM
34.2%
Centertel - Idea
28.0%
PTC - ERA GSM
37.8%
provided access to information on the location of the nearest bank, ATM, service station,
hotel, restaurant, cinema or theatre (and what was playing). Based on independent analyses
of the telecommunications market’s future development trends, non-voice services will be
the most rapidly developing segment of the mobile telephony market. At present, revenues
7
derived from non-voice services represent less than 5% of
the total revenue of the Polish operators, but this figure
has been growing at a fast pace.
2001 was the first year of such a large-scale migration of
customers from fixed-line networks to wireless telephony.
For many retail customers, wireless telephony became
much more attractive, particularly in the pre-paid system
of services.
Albrecht Dürer, The Nativity, 1504
Engraving, 16.8 x 11.8 cm
POLKOMTEL S.A. ON THE MOBILE TELEPHONY MARKET
Polkomtel S.A. is one of the three operators on the Polish mobile telephony market.
We launched our operations on February 1st, 1996, when we received the first Polish licence
to provide services in the GSM 900 system. We have conducted our commercial activities
under the Plus GSM trade name. We currently hold a permit to use the public mobile telephony
network and to reserve frequencies in the following systems: GSM (900 MHz), DCS
(1800 MHz) and UMTS. In 2001, we earned a net profit of PLN 591m, with sales revenue at
PLN 4,232m.
Our strategy encompasses the provision of services to a broad group of customers, with
particular focus on the business segment. As a result, in 2001 we once again were the leader
in the segment of the largest corporate users. Currently, more than half of the 500 largest
Polish companies rely on the Plus GSM network. Overall, at the end of 2001, Plus GSM provided
services to 3.44m customers, while our network covered 98% of Poland’s territory.
8
KEY EVENTS
January 1st, 2001
Polkomtel S.A.’s Technical Assistance Centre is awarded the international ISO 9002
certificate for handset repairs for Plus GSM subscribers.
January 19th, 2001
Grand opening of the ”From Monet to Gauguin” Art Exhibition held at the National Museum
in Warsaw, under the auspices of Plus GSM.
March 1st, 2001
Plus GSM introduces a new tariff offering: Czasami (Sometimes), Często (Often), and Non
Stop (Non Stop). The new offering provides subscribers with an opportunity to customise
the package of services and prices to fit their individual needs and telephone use.
May 15th, 2001
The Plus GSM network offers a special promotional package including 3GB (gigabytes)
Internet access via GPRS, 10MB (megabytes) WAP access via GPRS, Motorola Timeport 260
handset (GPRS – enabled), and hook up to the Plus GSM network under one of the new tariff
schemes.
May 25th, 2001
As the first in Poland and as one of the first in the world, the Plus GSM network implements
CAMEL technology, which is a component of the 3G mobile telephony resources. It permits
subscribers to access services – currently only available within the home network – also
during international roaming.
June 18th, 2001
The Extraordinary General Shareholders Meeting adopts a resolution on the procedure for
the financing of the Company’s further growth towards the development of the thirdgeneration mobile telephony (UMTS): the shareholders are to advance PLN 500m to the
Company.
June 27th, 2001
Polkomtel S.A.’s Supervisory Board appoints members to the Management Board. Mr Marek
Mroczkowski is appointed the President of the Management Board and the Company’s
General Director. The following persons are appointed members of the Management Board:
Mr Lars Andersen, Marketing Director; Mr Wojciech Pytel, Director of Operations;
Mr Jesper Helmuth Larsen, Financial Director; Mr John Treuge, Technical Director;
Mr Krzysztof Żmijewski, Human Resources Director; and Mr Władysław Wilkans,
IT Director.
July 23rd, 2001
The Plus GSM network launches an international roaming service in cooperation with the
200th operator and concurrently 100th country to become available to Plus GSM subscribers
while travelling abroad.
9
CUSTOMER SERVICE
As at the end of December 2001, the Plus GSM’s customer base – including subscribers (57%)
and pre-paid users (43%) – amounted to 3.44m users. This means that within a year our
customer base grew by 40%.
In 2001, our customer service strategy had the following objectives: to provide friendly,
professional and customised service and to use every available means of contact to establish
long-term customer relationships. We provided our customers alternative means of contact
with the Customer Service Department, and increased the scope of the available self-service
solutions by introducing the Interactive Voice Response System and direct debit.
Internet – in February 2001 we provided our customers with the ability to contact Plus GSM
using e-mail.
Direct debit – in March 2001, customers were provided with a new form of payment, which
permits them to pay for telecommunications services without the necessity of personally
executing the transaction. The payment is made by the customer’s bank directly to the
operator’s account.
Interactive Voice Response (IVR) – in November 2001, we introduced the Plus Kod service,
which is a simple way to identify Plus GSM network subscribers contacting the Customer
Service Department. As a result, customers may obtain all the necessary information on
accounts and current liabilities quickly and easily.
We also offer our subscribers access to Program 5 Plus under which, in exchange for using
network services, subscribers earn points redeemable for prizes. In December 2001, the
programme had almost 300,000 participants.
Under the programme, additional points are awarded to participants who take part in various
types of events and service promotions. Beyond the continually growing pool of prizes which
also come from third-party business partners, programme participants may use numerous
privileges. The possibilities range from discounts at Plus GSM shops to purchase of tickets and
passes for attractive concerts, shows and other spectacular cultural and sporting events.
We were the only operator to have shown preference for subscribers by offering them both
the possibility of having their handsets replaced and activating the Plus Tobie (Plus for You)
tariff, under which subscribers can use free minutes. Users who have been with Plus GSM for
18 months may receive up to 120 minutes of free calls. We have also introduced unique tariff
products, which are customised to respond to a given user’s style of telephone use (at peak
hours / non-peak hours / weekends), thanks to which subscribers are able to manage their
calling costs in a more efficient way.
We already hold four customer service ISO 9002 quality certificates. In August 2001, we
obtained an ISO 9002 certificate for the procedure of handling complaints and customer
correspondence on Polkomtel S.A.’s activities, and in September – for registration of
customer data and provision of access to services. In addition to these two, we also hold
quality certificates covering customer service via the telephone, updating customer accounts
at written or called-in request, and handset repairs. The ISO 9002 certificates were awarded
by KEMA QUALITY B.V., a Dutch certification company.
10
EMPLOYEES
As at the end of 2001, our workforce, measured
as full-time equivalents, amounted to 2,657
Polish employees and six foreign specialists.
In comparison to the number of persons
employed as at the end of 2000 (2,346 full-time
equivalents), our workforce grew by 311 fulltime employees.
The backbone of the Polkomtel S.A. staff are university graduates (46% of the workforce),
whose average age in 2001 stood at 29. Our employees participated in the total of 32,778
training days, with the training’s overall objective being to enhance our employees'
knowledge and skills – particularly in the Technical and IT Divisions.
In recruiting our management staff, we relied mainly on internal resources; this is why in
2001 almost 80% of the managers were promoted up from among our employees.
Our efforts to create and strengthen the public image included: launch of a project entitled
”Establishing the Image of an Attractive Employer”; participation in the job fair at the Silesia
University of Technology, where Polkomtel S.A. was awarded the title of the ”Company for
Engineers”; and participation in the INTECH 2001 job fair, where we earned the title of the
”Most Desired Employer”.
We also received the title of the ”2001 Human Resources Investor” awarded by the Warsaw
Institute of Management for our consistent policy of promoting professional development
among our staff, for raising the level of human resource management, and for promoting
knowledge.
11
NEW SERVICES AND INNOVATIONS
In 2001, we provided our customers with access to dozens of new services.
Offering for Corporate and Institutional Customers
Tariff and payment-related services:
- Taryfy Lider (Leader Tariffs) were introduced on May 15th, 2001 for the segment of large
corporate customers. The customers receive a cheaper subscription, in comparison with the
one offered to other segments, with extra call-time minutes included in the subscription fee.
– Strefa Biurowa (Office Zone) was introduced in May 2001 using the Intelligent Network
platform. It is used to set up internal networks based on the Plus GSM network. Office Zone
is a functional version of System Plus which has been enhanced by an option to introduce
customised charges depending on the location of the System Plus members. If a subscriber
initiating the call is within reach of the base stations comprising the Office Zone, the cost
of the call is billed at special reduced rates – both subscribers (the one calling and the one
being called) must be members of the same System Plus group.
– Plus Turbo was launched in November 2001 as a cutting-edge service on the Polish market
which enables a subscriber to have two different subscriptions – private and business – on
a single SIM card.
Location-based services:
– POS Plus was activated on April 24th, 2001 in cooperation with PolCard. It permits the
servicing of credit cards on electronic terminals equipped with GSM modems, for example
in taxis or used during fairs and trade events
Convergent services:
Pakiet Plus (Plus Package) services based on the Polkomtel S.A.’s transmission resources
facilitate the integration of mobile network services with those of a fixed-line network. This
allows us to provide customers with comprehensive telecommunications services. The
following services are part of Pakiet Plus:
– Intranet Plus: launched on July 25th, 2001 as a local network access service, based on the
provision of wireless data transmission to the company’s local intranet network. The service
is provided using high-speed data transmission (HSCSD) or packet transmission (GPRS).
– Internet access: launched on September 19th, 2001 to provide customers with access to the
Internet with a defined capacity (five line capacities to choose from).
– Fixed line: launched in September 2001 enables Polkomtel S.A. to provide customers with
the ability to use of a portion of the network’s transmission resources for the purpose of
the following services: customer’s PABX connecting to the Polkomtel S.A. network,
Internet access or access to IT resources of the customer’s corporate network, e.g. within
the framework of the Intranet Plus services.
12
News services:
– Biznes Plus was launched on June 15th, 2001 in cooperation with an outside business
partner. The service provides access to business information via SMS or WAP.
Offer for Retail Customers
Tariff services:
On March 1st, 2001, Plus GSM introduced a new tariff offering with three user profiles and 12
tariff schemes. All the tariff schemes have free calling minutes (from 10 to 300 minutes,
defined by the scheme name) included in the subscription fee. The way that the free calling
minutes can be used depends on which user profile has been chosen. Thanks to this offer,
customers may select the tariff scheme which best suits their calling needs:
– Czasami – the user profile designed for persons calling at off-peak hours and during the
weekend – times at which the effective rates are lower. Customers may also activate an
additional service, Sami Swoi. The following tariff schemes are available in the Czasami user
profile: Czasami 10, Czasami 30, and Czasami 150.
– Często – the user profile created for these who connect
throughout the day. The Często schemes are differentiated
depending on the time of day when a call is made – calls are
cheaper at off-peak hours, in the evening and on weekends.
Customers may also activate an additional service, Sami Swoi.
The following tariff schemes are available in the Często user
profile: Często 15, Często 50, Często 100, and Często 150.
– Non Stop – under this user profile there is no rate
differentiation depending on the time of day (flat rate). In
addition, subscribers can activate the System Plus service. The
following tariff schemes are available in the Non Stop user
profile: Non Stop 15, Non Stop 50, Non Stop 100, Non Stop
150, and Non Stop 300.
Loyalty programme tariffs:
– Plus Tobie and Plus Tobie II – tariff schemes implemented,
respectively, on January 15th, 2001 (under the then-effective
tariffs) and on June 18th, 2001 (for new tariffs). Under these
programmes subscribers are awarded additional free calling
minutes for the duration of their Plus GSM subscription. Within
this service, customers who have been Plus GSM subscribers for
18 and 36 months may receive from 20 to 120 free minutes,
depending on their tariff scheme and length of the subscription
period.
Albrecht Dürer, Adam and Eve (detail), 1504
Engraving, 25.3 x 19.3 cm (cut off)
13
Location-based services:
– Pilot Plus was launched on June 15th, 2001 as an SMS location-based service under which
users can gather information on the nearest ATM, bank, Plus GSM shop, service station,
cinemas and theatres (and what’s playing), hotels, restaurants, or camping grounds. The
service covers 40,000 cities and towns in Poland.
Communications services:
– Chat Plus was introduced on January 2nd, 2001 as a new communications tool enabling
users to chat via wireless handsets.
– Bramka WWW-SMS (Web-to-SMS Gate) was launched on August 12th 2001 as an
enhanced version of the Internet Web-to-SMS gate and additionally includes dropdown
menu, character counter, SMS counter, real-time notices on exceeding the limit or on the
blocking of the subscriber’s MSISDN number (an SMS can be received via the SMS gate).
– New user profiles in the Plusnet e-mail service were introduced as of December 19th,
2001 for customers using the Plusnet e-mail service. They can select from among two user
profiles: Zielony (Green) for everyone and Srebrny (Silver) for the demanding users
(provides greater capacity and many additional services such as the option to read e-mails
from two additional accounts, or mail filters).
Information services:
– In March 2001, we started to provide access to entertainment and news services and to
audio and text services. The services are based on the IN platform and permit our
subscribers and Simplus users to take part in competitions or use news and entertainment
services for higher call charges. This offering is parallel to TP S.A.’s 0-700 service. The
services are developed in cooperation with twenty of Poland’s largest media and
entertainment companies. An example of such an offering is the voting service which was
launched in September 2001. On the SMS platform, the service forwarded most up-to-theminute information on the general election to the Sejm (Lower House of Polish
Parliament).
– Directory of our subscribers was launched on July 9th, 2001 (accessible using WAP and
SMS). It is the first service of this type in Poland which provides access to a database of
telephone numbers of Plus GSM subscribers, permitting a number search as long as a given
number is listed.
– Info Plus is an SMS-based news service which was launched on October 1st, 2001. Users
can take out a 30-day subscription to access the following categories of information: News,
Weather, Sport, Entertainment (humour and quote of the day), Practical (name days,
lottery, quote of the day), and Business (daily news, exchange rates, stock market news).
Info Plus subscribers receive two or three SMSes daily.
– PKP Info (Polish State Railways Information) was launched on October 1st, 2001 with
an outside business partner. It provides access to information on train timetables via SMS.
14
– SMS Plus Portal was launched on November 6th, 2001 as a service permitting users to
create their own SMS news services.
– Encyklopedia PWN (Polish Scientific Publisher’s Encyclopaedia) was introduced on
December 17th, 2001 as a means to provide SMS or WAP access to all entries in the PWN
Great Encyclopaedia.
Voice (audio and text) news services:
– Reporter Plus was introduced on April 23rd, 2001 as a package of voice services designed
for Plus GSM subscribers, accessible under the shortened numbers: 300 – News, 301 – Sport,
302 – Weather, 303 – Entertainment, 304 – Special Service.
– Voice News Service at 3232 was launched on November 20th, 2001 to provide information
to our subscribers on eight Polish urban areas: Warsaw, Cracow, Poznań, the Katowice
agglomeration, Gdańsk-Gdynia-Sopot, Wrocław, Łódź, and Szczecin (including
information on how to get downtown from the airport, where to stay and dine, and how to
order a taxi).
Entertainment services:
– Rozrywka Plus (Entertainment Plus) was introduced on May 25th, 2001 as a package of
entertainment services provided using SMS, including: games (anagrams, guessing games,
Black Jack), quizzes, ringing tones, logos, icons, and graffiti. Subscribers are awarded
subscription to the Info Plus news service for every won game or correct quiz solution.
– Rozrywka Plus (accessible using WAP) was launched on July 2nd, 2001 as a WAP
counterpart to the SMS entertainment service. At present, it includes three games
(Battleships, SicBo and Roulette) and a quiz.
– Nowe Dzwonki Plus (New Ringing Tones Plus) service was launched in an improved
version on July 29th, 2001 allowing users to choose their handset ringing tones from any
one of the 300 available tunes, including the hottest hits.
System services
– WAP was made available on March 30th, 2001 in an improved version which includes
additional functions such as: sending SMSes from WAP pages, forwarding bookmarks to
telephones (to save most often used WAP pages) or remote WAP configuration of Ericsson
handsets (configuration information can be forwarded from Web pages to access the service
via telephone). In June 2001, we changed the visual layout of the network’s WAP pages so
that currently they are more functional and attuned to the users’ needs.
M-banking services:
– In 2001, in cooperation with Pekao S.A., mBank, Inteligo, and BZ WBK we launched SMS
services permitting subscribers to access their bank accounts.
15
Simplus (Plus GSM pre-paid service):
– Simplus PLN 30 calling card was introduced in February 2001 as a pre-paid card with a new
nominal value. It allows subscribers to extend the account term by an additional 30 days.
– International calling service was introduced in June 2001. Simplus users can call from
Poland to most countries in the world.
– Simplus Mega was introduced in 2001 as an addition to the Simplus offering which is based
on SIM Toolkit technology. Due to its ability to enlarge the telephone menu, a Mega card
provides easy access to a number of added-value services such as location-based, banking,
and m-commerce.
– Mono – second Simplus tariff scheme was introduced on September 3rd, 2001. It has a flat
rate per minute. The name of the existing tariff scheme was changed to Multi (its rates
depend upon the time of day).
– Usługi Krótkim Kodem (Shortened Code Services) were implemented on September 3rd,
2001 as a package of services permitting subscribers to manage their Simplus accounts
directly via the telephone (change tariffs, check tariff status, activate the account, change
the language, etc.) without having to use the IVR system or to speak to a call centre
assistant.
– International access to SMSes was launched on December 15th, 2001 as a first on the
market, free-of-charge roaming service providing access to SMSes retrieval in over 100
countries.
– SimplusNet (e-mail for Simplus users) was introduced on December 19th, 2001 as a
service which provides Simplus users with e-mail accounts and notifies, free-of-charge, of
every e-mail received.
Roaming Services
Roaming – the assurance of global reach – is one of the key drivers of our success and has
allowed us to become a leader among Polish GSM operators over the last five years in terms
of the number of countries and operators available in roaming for subscribers of the Plus GSM
network.
As at the end of 2001, 213 business partners in 106 countries worldwide provided roaming
access. Among them were Kenya, Venezuela, Peru, Armenia, Tanzania, Turkmenistan, Ghana,
Uganda, Madagascar, Mozambique, and Mongolia. In October 2001, we launched tri-band
roaming (based on the iDEN system) with Nexel, an American operator.
– SMS Welcome was launched on May 31st, 2001 as part of the network’s roaming services.
It is available in 15 languages to all foreign visitors (in-roamers) logging into the Plus GSM
network and to Plus GSM subscribers travelling abroad. Plus GSM subscribers receive an SMS
16
Welcome in Polish which contains a greeting, information on emergency numbers, and the
telephone number of the Polish embassy in a given country.
– Voice information service for in-roamers was activated on July 20th, 2001 under the short
No. 3131 in five languages: English, German, French, Russian, and Polish. The service
provides basic information on Cracow and Warsaw needed by a person visiting Poland (e.g.
taxi service, information on hotels and restaurants, and emergency numbers).
Albrecht Dürer, The Betrothal of the Virgin
Woodcut, 29.5 x 20.6 cm
17
OPERATING RESULTS
Customer Base
As of the end of 2001, the number of
customers using our network stood at 3.44m
and was 40% higher than the 2000 figure. The
number of subscribers amounted to 1.96m,
while customers using pre-paid services
totalled 1.48m (an increase of 21.8% and
74.2%, respectively). Customers using pre-paid
services represented 64% of the customers
acquired in 2001.
Churn Rate
In 2001, the churn rate was 22% as compared
to 16.4% in 2000. The increase was to a great
extent caused by the worsening economic
situation that forced many users to stop using
the network’s services. However, quarterly data
indicate a slowdown in the growth of the churn
rate. Accordingly, in the fourth quarter of 2001,
the rate dropped to 5.1%, from 5.8% in the
third quarter.
The above is a result of the growing attractiveness of the services offered by Plus GSM and
loyalty programmes that include different types of reduced tariffs or free minutes that are
available to active customers and those who have been using our services for a long time.
Average Revenue Per User
In 2001, average revenue per user (ARPU) dropped by 17.9%, to PLN 114.5 per month. The
occurrence of a decrease is a natural consequence of the growing market penetration and is
observed globally. The above is caused by an increasingly greater proportion of pre-paid
phone users in the total number of customers. Such customers generate substantially lower
revenues as compared with those generated by subscribers (throughout 2001, the figures
were PLN 36.6 and PLN 165.4 a month, respectively). Additionally, in line with the growing
market saturation, new customers are acquired from among less frequent users of Plus GSM
services. This, coupled with cheaper tariffs, means a drop in average revenue per subscriber.
In 2001, the figure dropped by 11.4%. However, this pattern does not apply to pre-paid
service users, who on average spent 6.7% more than in 2000.
18
INVESTMENTS IN THE NETWORK EXPANSION
In 2001, our capital expenditure amounted to PLN 938.5m. The resources were used mainly
to further expand our GSM network and to complete the construction of the backbone
network. It is the largest and most technically advanced transmission network using wireless
technology in Poland, consisting of over 180 SDH lines of a total length of 4,350 km.
Polkomtel S.A.’s backbone network connects 160 cities in 16 major administrative units of
Poland, enables a reduction of transmission costs in the Plus GSM network and, at the same
time, ensures a high degree of reliability.
We introduced many new elements that enhance the network’s functionality and the quality
of services.
– Operator's own synchronising network making use of, among other technologies, the
atomic clock.
– Testing of the platform for the purposes of GPRS-based international roaming was
accomplished successfully.
– Polkomtel S.A. was the first operator in Poland and one of the first operators worldwide to
implement the CAMEL technology enabling the provision of roaming services, as well as
third generation mobile telephony services. The application of this technology enables the
monitoring of services involving: data transmission, image transmission,
videoconferencing, pre-paid connections and individual messages on account balances in
the home network, also available in roaming.
– We launched a transit layer that will enable further implementation of new products,
services and technologies in the Plus GSM network.
– At the end of 2001, an ATM-based transport network was launched. It was the next step
towards the operation of a mobile telephony network that is in line with the third
generation networks.
– Capacity of the radio access network was increased by 27.5%.
The construction of a backbone network will enable Polkomtel S.A. to commence the
provision of convergent services in the near future. Thus, major customers will be able to use
mobile and fixed-line telephony services, as well as the Internet, within a single tariff scheme.
2001 was a year that witnessed thorough changes in the regulatory environment.
We concluded agreements on cooperation and settlements with mobile telephony operators.
A number of agreements were signed with alternative telecommunications operators. In
addition, pursuant to a decision by the President of Telecommunications Regulation
Authority, the rules for settlements with TP S.A. concerning domestic and international
traffic were changed. As a result, the share of interconnection revenue in Polkomtel S.A.’s
total revenue grew to over 20%.
19
FINANCIAL RESULTS
Sales Revenue
In 2001, the total net sales revenue amounted to
PLN 4,232m, which represents a 20.3% increase over
the previous year. Sales revenue comparised mainly
the revenue on sales of telephony services. Its share
in the revenue structure reached 97.5% in 2001,
Albrecht Dürer, The Annunciation,
while a year earlier it amounted to 95.8%. The majoWoodcut, 29.9 x 21.3 cm
rity of the remaining revenue was derived from sales
of handsets. This is an activity complementary to the core business and is aimed at increasing
the number of customers, that is our potential for revenue generation in the future.
The dynamic revenue growth in 2001 was caused mainly by the growing customer base. We
acquired 982,000 new users during the period. The total number of the Plus GSM network
users reached 3,444,000, which represents an increase of 40% compared to the end of 2000.
This high growth rate was only partially reflected in the increase in revenue, due to the
decrease in the average revenue per customer. In 2001, the average monthly revenue per
customer was PLN 114.5 against PLN 139.5 in 2000 (down by 17.9%).
At the same time, a gradual increase in the share of additional services, that is data
transmission and text messages, in the total revenue was seen. Overall in 2001, the revenue
on non-voice services amounted to PLN 226.7m and accounted for 5.3% of the total revenue.
In 2000, non-voice services represented 2.8% and in 1999 only 0.9% of the total revenue.
Operating Expenses
The cost of sales was PLN 3,158m, which represented a 14.4% increase over 2000. As a result,
the cost dynamics was 5.9% below the revenue dynamics. The main cost item was the cost of
services sold (77.4%) and the cost of handsets sold (21.6%). The latter item increased by
27%, to PLN 681m in 2001. The reduction of the costs of handsets sold, and the
corresponding reduction of the share of handset sales in the total revenue were a consequence
of a lower proportion of new connections in the total number of customers and of the policy
of limiting subsidised sales of new handsets. The increased share of pre-paid system users
who use less technologically advanced devices or buy second-hand handsets was also very
important in this context.
In turn, the cost of services sold rose by 15% last year. A relatively low rate of the growth
(considering a high increase in the number of customers and an over 30% rise of depreciation
charges resulting from larger investments) is a consequence of a rational financial policy and
the completed investments in the improvement of the quality of customer service.
In 2001, the balance of other operating income and expenses amounted to (-PLN 89.3m) as
compared to (-PLN 115m) in 2000.
20
Operating Result
Due to the factors discussed above, the operating profit reached PLN 983.9m in 2001, against
PLN 642.3m in 2000 (an increase by 53.2%). In turn, EBITDA (calculated on the basis of the
management accounting data), rose by 41.5% and amounted to PLN 1,527.4m. The EBITDA
margin, therefore, reached 35.6% in 2001, against 30.5% in 2000.
Net Result on Financial Activities
In 2001, the result on financial transactions was negative and reduced the operating profit by
PLN 258.9m. In the previous year, the value of this item was similar and amounted to
(-PLN 253.4m). This result was recorded despite the increase of debt from PLN 1,936m to
PLN 2,072m. One of the factors that contributed to such an adverse development were
falling EUR and USD exchange rates (by 8.6% and 3.8%, respectively).
Net Profit
A significant increase in the operating result, coupled with a stable balance of the financial
income and expenses, contributed to a strong growth of the pre-tax profit. In 2001, the pretax profit increased by 86% and amounted to PLN 725m. As a result of a decrease in the
effective tax rate (from 47% to 18%), the net profit’s growth was even stronger. Following
an increase of 187%, the net profit reached PLN 591m.
Balance Sheet
As at the end of 2001, the balance-sheet total amounted to PLN 7,283m and did not change
significantly in relation to the previous year (down by 2%). The asset structure changed in
2001. The share of fixed assets increased from 36% to 43%, while the weighting of current
assets in the asset structure decreased from 13% to 10%. Prepayments and accrued income,
which mainly include the value of the UMTS license, still represent a very significant item in
the asset structure (45%).
On the other hand, a decrease in the weight of liabilities in the equity and liabilities was
observed (down from 75% in 2000 to 54% as at the end of 2001). Total liabilities amounted
to PLN 3,943m, of which PLN 2,072m was attributed to the liabilities under loans and
borrowings (an increase of 7% in relation to 2000). A borrowing of PLN 500m advanced by
the Company’s shareholders to finance the purchase of the UMTS license represents a
significant debt item.
21
Cash Flow
In 2001, the net operating cash flow amounted to PLN 540.5m and was comparable with the
net profit earned in the same period. Investment activities, in turn, absorbed PLN 944m. The
value of capital expenditure did not change in relation to the previous year. The surplus of
capital expenditure over the inflow of cash from the operating activities was financed entirely
by the shareholders with a borrowing (PLN 500m) and through a share issue (PLN 412.5m).
Some of the proceeds were also used to repay Company’s liabilities to financial institutions.
Albrecht Dürer, The Adoration of the Magi, 1511
Woodcut, 29.2 x 22.1 cm
22
FINANCIAL REPORT
Financial Highlights
as of
December 31st, 2000
previous year
December 31st, 2001
current year
BALANCE SHEET
Fixed assets
Current assets
Balance-sheet total
Shareholders’ equity
2 679 461 849.54
929 294 178.23
7 434 236 476.23
1 373 498 864.71
3 147 486 451.29
718 623 167.38
7 282 559 319.86
2 514 447 790.32
PROFIT AND LOSS ACCOUNT
Net sales revenue
Profit on sales
Operating profit
Pre-tax profit
Net profit
3 518 242 714.14
757 322 757.47
642 280 103.13
388 841 676.31
205 899 631.96
4 231 642 205.24
1 073 182 766.41
983 860 908.73
725 001 609.12
590 948 925.61
648 044 851.16
-959 486 518.45
314 327 519.03
540 543 337.59
-943 888 625.47
429 306 699.73
Cash-flow statement
Net operating cash flow
Net investing cash flow
Net financing cash flow
Albrecht Dürer,
St. Eustache, 1501-1502
Engraving, 36 x 26.1 cm
23
Auditor’s Opinion
To the Shareholders, Supervisory Board and Management Board of Polkomtel S.A.
We have audited the financial statements of Polkomtel S.A., with registered offices at
Al. Jerozolimskie 81, Warsaw, Poland, comprising:
– Balance sheet as of December 31st, 2001, showing a balance-sheet total of PLN
7,282,559,319.86,
– Profit and loss account for the period January 1st – December 31st, 2001, showing a net
profit of PLN 590,948,925.61,
– Cash-flow statement for the period January 1st – December 31st, 2001, showing a net
increase in cash during the financial year of PLN 25,961,411.85,
– Notes to the balance sheet and the profit and loss account, with supplementary
information.
The Company’s Directors are responsible for the preparation of the financial statements.
Our responsibility was to issue an opinion on the financial statements based on the findings
of the audit.
We carried out our audit in accordance with the provisions of
– the Polish Accountancy Act of September 29th, 1994,
– professional auditing standards issued by the National Board of Chartered Auditors.
The abovementioned regulations and standards require that we plan and perform our audit so
as to obtain reasonable and sufficient evidence to issue an opinion on whether the audited
financial statements are free from material misstatements.
In particular, our audit included examination, largely on a test basis, of evidence relevant to
the amounts and disclosures in the financial statements. It also included an assessment of
significant estimates and judgments made by the Company in the preparation of the financial
statements and of whether the accounting policies are appropriate to the situation of the
Company. In forming our opinion we also evaluated the overall adequacy of the presentation
of information in the financial statements. We believe that our audit has provided us with
sufficient evidence to issue an opinion.
In our opinion the financial statements of Polkomtel S.A. for the 2001 financial year were
prepared, in all material aspects:
– based on properly maintained accounting books, permitting the preparation of the financial
statements free from material misstatements,
– consistent, in terms of their form and content, with the requirements of the Polish
Accountancy Act of September 29th, 1994 and the Company’s Articles of Association,
24
– in accordance with consistently applied Polish accounting principles, as defined in the
abovementioned Polish Accountancy Act,
and disclose, in a fair and clear manner, all the information necessary for the assessment of
the Company’s profitability and financial result on the operations in the period under review,
as well as the assets and financial standing of the Company as of December 31st, 2001.
The financial information contained in the Directors’ Report on the Company’s business
activities in the 2001 financial year, which was based directly on the audited financial
statements, is consistent with the statements.
While issuing no qualifications as to the accuracy and reliability of the audited financial
statements, we would like to draw attention to Section 16 of the notes wherein the
Company’s Directors described the impact of the Ministry of Finance’s currently binding
interpretation regarding the tax settlement of the license.
Auditor:
Maria Rzepnikowska
Reg. No. 3499
Persons acting on behalf of the auditor:
Maria Rzepnikowska, Executive Board
President
Wacław Nitka, Executive Board Member
Deloitte & Touche Audit Services Sp. z o.o.
ul. Fredry 6
00-097 Warsaw, Poland
Entity qualified to audit financial statements
Reg. No. 73
Warsaw, February 8th, 2002
25
Balance Sheet – Assets
as of
December 31st, 2000
previous year
ASSETS
Fixed assets
Intangible fixed assets
Costs of organisation and subsequent
extension of joint-stock company
Research and development expense
Goodwill
Other intangible fixed assets
Intangible fixed assets not put into service
Prepayments for intangible fixed assets
Tangible fixed assets
Owned land
Buildings and structures
Plant and equipment
Vehicles
Other tangible fixed assets
Investments in progress
Prepaid investments
Financial fixed assets
Shares and equity interests
Securities
Long-term loans advanced
Other financial fixed assets
Long-term accounts receivable
Current assets
Stocks
Materials
Semi-products and work in progress
Finished products
Goods for resale
Prepaid deliveries
Short-term accounts receivable
Short-term trade debtors
Taxes, subsidies and social security receivable
Other accounts receivable
Accounts receivable under court proceedings
Treasury shares for disposal
Marketable securities
Cash and cash equivalents
Cash in hand
Cash at banks
Other cash and cash equivalents
Prepayments and accrued income
Deferred income tax
Accrued income
Other prepayments and accrued income
Total assets
26
December 31st, 2001
current year
2 679 461 849.54
144 611 720.00
3 147 486 451.29
212 860 194.65
9 806 254.27
0.00
0.00
113 055 675.91
21 749 789.82
0.00
2 534 850 129.54
26 352 959.84
341 984.38
2 139 746 135.83
19 318 772.78
48 654 887.62
298 347 626.18
2 087 762.91
0.00
0.00
0.00
0.00
0.00
0.00
929 294 178.23
174 488 411.71
3 269 346.00
0.00
0.00
171 219 065.71
0.00
740 286 255.20
408 643 078.07
328 755 456.26
2 887 720.87
0.00
0.00
0.00
14 519 511.32
844 403.14
12 508 188.15
1 166 920.03
3 825 480 448.46
56 586 863.33
3 535 323 917.16
233 569 667.97
7 434 236 476.23
9 452 833.23
0.00
0.00
156 416 701.66
46 990 659.76
0.00
2 934 626 256.64
26 352 959.84
332 526.03
2 492 068 941.46
25 091 428.67
62 969 103.85
326 590 888.98
1 220 407.81
0.00
0.00
0.00
0.00
0.00
0.00
718 623 167.38
146 562 948.80
23 547 653.76
0.00
0.00
123 015 295.04
0.00
531 579 295.41
412 463 365.53
116 951 851.07
2 164 078.81
0.00
0.00
0.00
40 480 923.17
875 027.62
24 589 878.26
15 016 017.29
3 416 449 701.19
0.00
3 262 497 772.85
153 951 928.34
7 282 559 319.86
Balance Sheet – Equity and Liabilities
as of
December 31st, 2000
previous year
SHAREHOLDERS’ EQUITY AND LIABILITIES
Shareholders’ equity
1 373 498 864.71
Share capital
1 500 000 000.00
Called-up share capital not paid (negative value)
0.00
Reserve funds
10 373 661.35
Share premium account
0.00
Statutory reserve funds
10 373 661.35
Reserve funds set up pursuant
to the Articles of Association
0.00
Additional contributions to equity
0.00
Other
0.00
Revaluation capital reserve
0.00
Other capital reserve
0.00
Currency-translation differences
on foreign-currency branches (plants)
0.00
Accumulated loss or retained
profit brought forward
-342 774 428.60
Net profit (loss)
205 899 631.96
Provisions
29 881 636.52
Deferred income tax provision
0.00
Other provisions
29 881 636.52
Provison for stocks
0.00
Provisions for guarantees
0.00
Other provisions
29 881 636.52
Liabilities and special accounts
5 591 413 256.92
Long-term liabilities
2 944 108 121.92
Long-term borrowings, bonds
and other securities
0.00
Long-term bank loans
1 410 382 298.81
Other long-term liabilities
1 533 725 823.11
Short-term liabilities
2 645 882 731.01
Short-term borrowings,
notes and other securities
149 800 000.00
Bank loans
376 040 730.77
Prepaid deliveries
0.00
Trade creditors
521 125 266.57
Promissory notes payable
0.00
Tax. duty. social security payable
341 349 641.68
Salaries and wages payable
15 140.57
Other short-term liabilities
1 257 551 951.42
Special accounts
1 422 403.99
Accruals and deferred income
439 442 718.08
Accrued expenses
179 369 183.13
Deferred income
260 073 534.95
Total shareholders’ equity and liabilities
7 434 236 476.23
December 31st, 2001
current year
2 514 447 790.32
2 050 000 000.00
0.00
26 845 631.91
0.00
26 845 631.91
0.00
0.00
0.00
0.00
0.00
0.00
-153 346 767.20
590 948 925.61
286 084 119.72
233 469 840.21
52 614 279.51
0.00
0.00
52 614 279.51
3 943 247 077.52
2 888 459 256.65
500 000 000.00
1 014 918 256.65
1 373 541 000.00
1 052 654 334.25
138 300 000.00
418 740 478.19
0.00
406 208 326.19
0.00
61 301 435.21
179 163.78
27 924 930.88
2 133 486.62
538 780 332.30
287 656 873.08
251 123 459.22
7 282 559 319.86
27
Profit and Loss Account
For period ending
December 31st, 2000
previous year
December 31st, 2001
current year
Net sales revenue
3 518 242 714.14
4 231 642 205.24
Net revenue on sales of products and services
3 369 340 434.94
4 125 731 223.03
Revenue on sales of products
Revenue on sales of services
Net revenue on sales of goods
for resale and materials
Revenue on sales of handsets
Revenue on sales of other goods
for resale and materials
0.00
4 125 731 223.03
148 902 279.20
105 910 982.21
99 056 400.14
98 862 973.58
49 845 879.06
7 048 008.63
Cost of sales
2 760 919 956.67
3 158 459 438.83
Cost of products and services sold
2 125 956 782.20
2 445 333 830.27
0.00
0.00
2 125 956 782.20
2 445 333 830.27
Cost of products sold
Cost of services sold
Raw materials and energy used
Contracted services
91 748 388.02
75 177 284.97
1 163 672 778.44
1 278 484 416.31
Taxes and charges
13 230 359.28
38 464 399.87
Salaries and wages
164 736 114.11
216 946 339.67
Employee benefits
42 065 462.53
54 322 624.31
Depreciation and amortisation
344 868 128.95
450 044 531.86
Other
305 635 550.87
331 894 233.28
634 963 174.47
713 125 608.56
536 606 974.00
681 317 119.66
Cost of goods for resale and materials sold
Cost of handsets sold
Cost of other goods for resale sold
Gross profit (loss) on sales
Selling costs
General and administrative expenses
98 356 200.47
31 808 488.90
757 322 757.47
1 073 182 766.41
0.00
0.00
0.00
0.00
Profit (loss) on sales
757 322 757.47
1 073 182 766.41
Other operating income
123 205 155.64
99 915 938.10
3 040 669.18
3 329 356.98
0.00
0.00
Proceeds from sale of tangible fixed assets
Subsidies
Other
120 164 486.46
96 586 581.12
Other operating expenses
238 247 809.98
189 237 795.78
3 018 516.32
1 923 768.45
235 229 293.66
187 314 027.33
181 143 441.26
10 482 319.31
Value of tangible fixed assets disposed of
Other
Provisions for accounts receivable.
including for:
Accounts receivable uncollectible under law
1 175 273.96
3 768 960.72
179 968 167.30
6 713 358.59
Other provisions and revaluation write-offs
12 955 290.77
4 816 048.23
Other operating expenses
41 130 561.63
172 015 659.79
Doubtful trade debtors
28
0.00
3 369 340 434.94
Operating profit (loss)
Income from equity investments
Income from other financial fixed assets
Other financial income
642 280 103.13
0.00
983 860 908.73
0.00
0.00
0.00
105 547 163.50
118 998 998.25
Interest received
66 281 093.81
48 465 333.63
Other
39 266 069.69
70 533 664.62
Foreign exchange gains (realised)
18 096 100.06
57 916 442.01
Other financial income
21 169 969.63
12 617 222.61
Commissions and other income
4 024 952.40
7 166 529.51
17 145 017.23
5 450 693.10
358 985 590.32
377 858 297.86
0.00
0.00
318 517 318.76
301 630 745.31
170 572 553.48
184 941 141.59
Interest on loans and borrowings
– accrued
18 806 943.32
27 351 381.57
Interest on loans and borrowings
– paid
151 765 610.16
157 589 760.02
147 944 765.28
116 689 603.72
41 179 207.82
31 347 534.57
106 765 557.46
85 342 069.15
40 468 271.56
76 227 552.55
26 111 903.84
10 053 365.48
26 111 903.84
9 970 854.94
0.00
82 510.54
14 356 367.72
66 174 187.07
Interest accrued
Financial expenses
Revaluation write-offs
on financial fixed assets
and short-term securities
Interest, including to subsidiary
and associated undertakings
Interest on loans and borrowings
Other interest
Other interest – accrued
Other interest – paid
Other financial expenses
Foreign exchange losses
Realised
Unrealised
Other
Pre-tax profit (loss) before extraordinary items
388 841 676.31
725 001 609.12
Result on extraordinary items
0.00
0.00
Extraordinary gains
0.00
0.00
Extraordinary losses
0.00
0.00
Pre-tax profit (loss)
388 841 676.31
725 001 609.12
Corporate income tax
216 779 617.34
-156 004 020.03
Other mandatory decrease of profit
(increase of loss)
-33 837 572.99
290 056 703.54
Difference between income tax as disclosed
in balance sheet and income tax payable
-33 837 572.99
290 056 703.54
Net profit (loss)
205 899 631.96
590 948 925.61
29
Cash-Flow Statement
For period
January 1st –
January 1st –
December 31st, 2000
December 31st, 2000
– indirect method *)
648 044 851.16
540 543 337.59
Net profit (loss)
205 899 631.96
590 948 925.61
Total adjustments
442 145 219.20
-50 405 588.02
Depreciation and amortisation
346 787 084.19
450 058 086.86
Foreign exchange (gains) losses
14 622 132.41
-44 932 219.22
192 063 589.00
183 878 410.24
9 795 797.39
25 805 936.86
126 271 533.25
248 733 382.53
182 942 044.35
134 052 683.51
-214 913 691.12
60 215 104.23
-71 568 950.91
27 925 462.91
-236 274 268.76
311 964 976.26
2 570 232 164.07
-1 646 401 884.66
-2 397 084 378.73
227 261 733.68
117 235 646.26
-8 950 075.73
Other adjustments
-197 963 482.20
-20 017 185.49
B. NET INVESTING CASH FLOW
-959 486 518.45
-943 888 625.47
33 085 096.41
8 078 099.39
0.00
0.00
32 950 868.58
8 078 099.39
NET OPERATING CASH FLOW
Dividends and interest
(Profit) loss on investment activities
Net change in other reserves
Corporate income tax
(disclosed in profit and loss account)
Corporate income tax paid
Change in stocks
Change in accounts receivable
Change in short-term liabilities
(net of loans and borrowings)
Change in prepayments and accrued income
Change in deferred income
Investing cash inflow
Sale of intangible fixed assets
Sale of tangible fixed assets
Sale of financial fixed assets, including:
0.00
0.00
in subsidiary undertakings
0.00
0.00
in associated undertakings
0.00
0.00
in Parent Undertaking
0.00
0.00
Sale of marketable securities
0.00
0.00
Decrease in long-term loans advanced
0.00
0.00
Dividends received
0.00
0.00
Interest received
0.00
0.00
134 227.83
0.00
Other investing cash inflow
30
Investing cash outflow
-992 571 614.86
-951 966 724.86
-57 558 633.59
-134 104 271.20
-935 012 981.27
-817 862 453.66
Acquisition of intangible fixed assets
Acquisition of tangible fixed assets
Acquisition of financial fixed assets, including:
0.00
0.00
in subsidiary undertakings
0.00
0.00
in associated undertakings
0.00
0.00
in Parent Undertaking
0.00
0.00
Acquisition of treasury shares
0.00
0.00
Purchase of marketable securities
0.00
0.00
Long-term loans advanced
0.00
0.00
Other investing cash outflow
0.00
0.00
C. NET FINANCING CASH FLOW
314 327 519.03
429 306 699.73
Financing cash inflow
632 643 371.26
1 000 131 966.64
0.00
500 000 000.00
0.00
0.00
345 343 371.26
42 699 747.42
debt securities
149 800 000.00
0.00
Proceeds from issue of own shares
137 500 000.00
412 500 000.00
Additional contributions to equity
0.00
0.00
Other financing cash inflow
0.00
44 932 219.22
Financing cash outflow
-318 315 852.23
-570 825 266.91
Decrease in long-term loans and borrowings
-111 630 130.82
-375 446 856.67
or other long-term debt securities
0.00
0.00
Decrease in short-term bank loans and borrowings
0.00
0.00
or other short-term debt securities
0.00
-11 500 000.00
Cost of issue of own shares
0.00
0.00
Retirement of treasury shares
0.00
0.00
Dividends and other distributions to shareholders
0.00
0.00
and supervisory staff
0.00
0.00
Charitable distributions
0.00
0.00
Decrease in financed lease liabilities
0.00
0.00
Increase in long-term loans and borrowings
Issue of bonds or other long-term
debt securities
Increase in short-term loans and borrowings
Issue of bonds or other short-term
Redemption of bonds
Redemption of bonds
Distribution from profit to executive
31
Interest paid
-192 063 589.00
-183 878 410.24
-14 622 132.41
0.00
D. TOTAL NET CASH FLOW (A+/-B+/-C)
2 885 851.74
25 961 411.85
E. BALANCE-SHEET CHANGE IN CASH
2 885 851.74
25 961 411.85
F. CASH AT BEGINNING OF PERIOD
11 633 659.58
14 519 511.32
G. CASH AT END OF PERIOD (F+/- D)
14 519 511.32
40 480 923.17
Other financing cash outflow
change in cash resulting
from foreign exchange gains/losses
32
P O L KO M T E L
S . A .
s p o n s o r e d
t h e
e x h i b i t i o n
i n
t h e
N a t i o n a l
M u s e u m
i n
Wa r s a w
Albrecht Dürer
Significance and Influence of his Prints in the Sixteenth Century
RIVALS, CONTINUERS, IMITATORS
Albrecht Dürer’s art was imitated by a number of artists.
However, Dürer had only a few assistants as he did not keep a
regular studio. He preferred to cooperate with other artists, to
name Hans Baldung Grien, Hans Schäufelein or Hans Suess
from Kulmbach. Sebald Beham with his brother Barthel and
Georg Pencz probably also worked at Dürer’s studio.
Death did not cease his fame. Dürer’s drawings continued to
fascinate with style, technique and form. Also the themes of his
works were attractive to artists, writers and art theoreticians, as
they reflected the intellectual approach of Renaissance artists,
who explored the surrounding world and expressed it in its
natural shapes.
Words of Hans Sachs, the famous poet from Nuremberg,
inscribed on the Erhard Schön’s woodcut portrait of the poet
(1528), are an apt description of Albrecht Dürer’s art:
”His art was superior to other artist of his times. He was honoured
by dukes, lords and all artists who still admire and praise his work
and use it as a great example”.
• Bartholomäus Bruyn the Elder, Christ Appearing to Mary, 1515–1525
After a drawing from the Small Passion of Albrecht Dürer tempera, oil on oak panel, 67 x 32.5 cm
• German painter, Adam and Eve, beginning of 17th century
Copy of Albrecht Dürer’s engraving of 1504, oil on copper plate, 24.5 x 18.5 cm
• Master of Messkirch, The Mocking of Christ, between 1530 and 1538
After a drawing from the Small Passion of Albrecht Dürer, tempera, oil on spruce panel, 63.7 x 52.2 cm
• Hans Schäufelein, Portrait of a Man, ca. 1507
Signed with the AD monogram, oil on lime panel, 41 x 31.5 cm
• Georg Pencz (Nuremberg school)?, The Holy Trinity
After Albrecht Dürer’s woodcut of 1511, oil on panel, 51.3 x 39.2 cm
• Lucas Cranach the Elder, Adam and Eve, 1512
Copy of Albrecht Dürer’s engraving of 1504, tempera on wood, 59 x 44 cm
COMPANY AS A CORPORATE CITIZEN
We have actively participated in Poland’s cultural and social life since the inception of Plus GSM. Through sponsored
activities, we support a number of initiatives and programmes in the areas of public security, health care, education,
cultural life and sport. We also engage in charitable activities.
Our most notable initiatives and programmes in 2001 included:
Charity Work and Health Care
We pay particular attention to supporting organisations and institutions that operate for the benefit of children and
youth.
We provide support and assistance to the following organisations and institutions: selected children’s homes,
Fundacja Edukacji Ekonomicznej (Foundation for Economic Education) for the gifted children from poor families,
Fundacja Bezpieczne Dzieciństwo (Safe Childhood Foundation) which organises holidays for children from poor
families, and Stowarzyszenie Po Pierwsze Rodzina (Family First Association) operating for the benefit of physically
and mentally challenged children.
We also support education initiatives in cooperation with such academic institutions as the Technical Universities
of Warsaw and Lublin. For several years, Polkomtel S.A. has donated large amounts of computer equipment to
schools and institutions. In 2001, nineteen such organisations obtained help from us.
Special support was lent to organisations and institutions in the health care sector. We provided financial aid to such
scientific and research initiatives as those of the Robert Koch Foundation at the Tuberculosis and Pulmonary
Diseases Institute in Warsaw and the Physiology and Pathology of Hearing Institute. We also cooperated with the
Dr Clown Foundation, which is engaged in laughter therapy programmes at children’s in-patient clinics.
Safety
Co-operation with TOPR, GOPR and WOPR
We continued cooperation with three emergency response organisations: Tatrzańskie Ochotnicze Pogotowie
Ratunkowe (Polish Tatra mountains emergency response corps), Górskie Ochotnicze Pogotowie Ratunkowe
(Polish mountains emergency response corps) and Wodne Ochotnicze Pogotowie Ratunkowe (Polish rivers and
lakes emergency response service corps). The 603 100 100 Emergency Line (toll-free calls for Plus GSM subscribers
and pre-paid users) facilitates the prompt response of emergency teams, while funds directly donated to the three
organisations were largely spent on modernisation and purchase of safety equipment.
Culture
”From Monet to Gauguin” painting exhibition
Impressionsts’ and Post Impressionsts’ paintings from Musee d’Orsay in Paris were exhibited in the national
museums in Warsaw, Poznań and Kraków. It was thanks to our support that the paintings of the most renown
33
representatives of Impressionism and Post Impressionism were shown in Poland, which was definitely the highlight
of cultural life in Poland in 2001. We were the exclusive sponsor of the exhibition.
A record 500,000 visitors saw the paintings in the three cities.
Release of ”Głosy” CD
A million copies’ publication of the Zbigniew Preisner CD ”Głosy”, distributed by Gazeta Wyborcza (the recording
included new pieces of music and arrangements by Zbigniew Preisner), and a subsequent concert, were some of the
highlights of the Fifth Anniversary of Plus GSM.
”Lato Filmów” Film and Art Festival in Kazimierz Dolny
Plus GSM once again sponsored the Kazimierz Summer Film Festival, whose main objective is to promote nonmainstream values among young people.
Centenary of the first staging of ”Wesele” by Stanisław Wyspiański in Kraków
Plus GSM sponsored the celebrations of the centenary of ”Wesele” (The Wedding), which included ”Serce moje gram”
and ”Duchy świadków Wesela” (musical and theatre shows), various academic sessions, the ”Encyklopedia Wesela”
(a book on the Wyspiański drama), and ”Wesele” cinema film shows.
Cooperation with Towarzystwo Muzyczne im. Henryka Wieniawskiego (Polish musical society for culture makers,
artists and music lovers)
For many years, we have supported the society. In 2001, the long-term cooperation produced a joint organisation
of Międzynarodowy Konkurs Skrzypcowy im. H. Wieniawskiego (international violin contest) and
Międzynarodowy Konkurs Lutniczy im. H. Wieniawskiego (international violin makers contest).
Sport
Sponsorship of the Polish national volleyball team
The cooperation of Plus GSM and the Polish national volleyball team, which continued for three years, has been the
most extensive sponsorship programme in Polish sport ever.
Beach volleyball Poland’s Championship for Women ”Simplus CUP 2001”
Last year, we resolved to use the trade name ”Simplus” as a sponsor trademark for beach volleyball, which has been
recently gaining in popularity in Poland.
Tour de Pologne cycling event
Plus GSM has cooperated with the Tour de Pologne for many years. The sponsorship of the event allowed us to reach
out to its present and future clients in south-eastern Poland.
34
Other issues
Seminar ”The Internet, its processes and interaction as a driving force for a 21st century company”, featuring
Michael Hammer
Plus GSM was the main sponsor of the seminar, featuring a most exquisite business and management theoretician,
Michael Hammer. The seminar attracted a lot of attention from the media and the managerial staff of Poland’s
largest corporations.
Sponsorship of the Best Web Page contest ”I.Net Awards”
Plus GSM was for the second time the exclusive sponsor of the ”I.Net Awards” contest. The contest was followed by
a festive gala in December 2001.
Celebrations of the 175th Anniversary of the Technical University of Warsaw
Plus GSM was a Leading Sponsor of the anniversary celebrations at one of the oldest technical universities in Poland.
We are also fully financing the new building of the Museum of the Technical University of Warsaw, currently under
construction. The cooperation with the University offers us an opportunity to frequently meet some of the
Company’s potential employees.
PRIZES AND AWARDS
During a GSM congress held in Cannes, we received the prestigious GSM Association prize in ”Best GSM
Application in a Crisis” category for our activities in 2001 organised to help flood victims, and most importantly
for the fund raising campaign among subscribers using SMSes with special tariff rates. This is the second prize that
we have received from the GSM Association. In 2000, we were commended for the ”Service Programme for Deaf
and Hearing Disabled Customers” which was recognised as the Most Innovative GSM Product.
September 2001 – Polkomtel S.A. takes first place in the ”Infrastructural Enterprises” category in a ranking organised
under the auspices of the Prime Minister and based on the research of the Institute of Economic Studies at the Polish
Academy of Sciences which was carried out upon the initiative of the Prawo i Gospodarka news magazine.
July 2001 – the Company is awarded the title of 2000 Patron of Culture in Kraków in the ”Most Interesting and
Effective Form of Patronage” category.
July 2001 – Plus GSM’s international roaming services wins the ”Know the World” prize as the best service of its kind.
June 2001 – the Company is awarded the Economic Prize by the President of the Republic of Poland as the ”Best
Polish Company of 2000”.
35
June 2001 – Plus GSM’s display at the MTP Elektricon job fair wins the
Company the Silver Medal.
May 2001 – the Company receives the ”Golden Arrow of 2001” in
the ”Innovations” category and additional prize in the ”Multimedia
Web pages” category for Miasto Plusa (City of Plus), and in the
”Direct B2C Transfer” category it is honoured for its Program 5
Plus.
May 2001 – the Company takes first place and receives the
Rzeczpospolita ”Eagle” in the ”Infrastructure Enterprise” category in
terms of the effective use of human resources, assets and finances.
Research was conducted by the Institute of Economic Sciences at the
Polish Academy of Sciences under the auspices of the Prime Minister
of the Republic of Poland.
Albrecht Dürer,
St. Mary with Child and Monkey, ca. 1498
Engraving, 19.1 x 12.3 cm
May 2001 – Plus GSM’s packet data transmission (GPRS) wins Gold
Medal and Sliver Medal is awarded for the Company’s display during INFOSYSTEM 2001 International
Telecommunications, Technology and Electronics Trade Show.
April 2001 – the 2000 Boomerang award goes to the Company in Loyalty Campaigns category for its Program 5
Plus, and a special award is awarded by Telekomunikacja Polska SA – ”Golden Receiver” – for the best telemarketing
campaign, Plus GSM’s Handset Replacement Programme.
March 2001 – the Company is honoured with the ”Human Resource Investor” distinction emblem for the ongoing
enhancement of the level of human resource management, promotion of knowledge and practical know-how. The
emblem is awarded at the Great Gala of the Warsaw Institute of Management during the 8th Staff Conference and
3rd Staff Fair.
February 2001 – Świat Telekomunikacji awards Plus GSM the ”Golden Antenna” for Simplus campaign as the ”Best
Promotion of the Year”.
36
Annual
Report
Albrecht Dürer, Knight and Landsknecht
Woodcut: 38.7 x 27.3 cm
2001
02-001 Warsaw, Aleje Jerozolimskie 81,
Phone (+48 22) 607 10 00
Customer Service Office: phone (+48 22) 607 16 01
Commercial Information: phone 0 800 601 601
Internet: http://www.plusgsm.pl
Annual Report
2001