Annual Report 2011 - T-Hrvatski Telekom

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12 Investor Information Economic environment and share price performance analysts to downgrade Croatia’s 2011 GDP growth forecast throughout the year to settle at around zero. Introduction Global uncertainties and market volatility prevailed in 2011, with growing budget deficits, the Eurozone debt crisis, an overall fall in consumer confidence, social unrest and a slowdown in the economies of Asia and South America, among others. These factors reignited concerns about a prolonged global recession. Uncertainty was further exacerbated by the Japanese tsunami, the Arab Spring and other tensions in the Middle East, with the latter triggering concerns about global oil supplies and inflation. Global markets were highly volatile and largely subdued. In August, Standard & Poor’s removed for the first time the AAA credit rating of US, and this prompted further downward pressure on stock markets worldwide. Big policy initiatives from the newly elected left-ofcentre coalition Government are yet to emerge. The major credit agencies are expected to visit Croatia in first half of 2012 to discuss the sovereign credit rating. Meanwhile, in January 2011 a referendum on EU membership showed majority support and the accession target date is 1 July 2013. Against the economic backdrop outlined above and poor liquidity, the Zagreb Stock Exchange experienced strong downward pressure, especially in the second half of the year, amid speculation that a dividend tax would be introduced. Consequently, the benchmark CROBEX index fell 17.6% in 2011, after two years of growth. Annual trading volumes showed another year of decline, falling 9.4%. With Croatia’s parliamentary election in December 2011, the long overdue fiscal consolidation and structural reforms of Croatia’s economy were postponed. Domestic consumption hit a new low, unemployment remained high and problems with overdue payments persisted. These factors caused T-HT shares ended the year at HRK 242.00, down 16.2% on the HRK 288.71 closing price at the end of 2010 and marginally outperforming the CROBEX. The price decline was primarily seen in the first half of the year following the Company’s dividend announcement in mid February and ex-dividend T-HT Share and GDR as compared to CROBEX and Dow Jones Europe Stoxx Telecommunications Index 1 January 2011 - 30 December 2011 % 130 125 120 115 110 105 100 95 90 85 80 75 70 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec T-HT Share T-HT GDR CROBEX DJ Euro Stoxx Telecommunications Index
13 date in early May. The year’s highest price was HRK 315.99, the lowest being HRK 224.05 (Source: Zagreb Stock Exchange). In 2011, T-HT shares underperformed the Dow Jones Euro Stoxx Telecommunications Index (a leading indicator of the telecommunications industry that measures the performance of some Europe’s largest telecom companies) by 10 percentage points, having outperformed it for the previous two years. Although its turnover was around 15% lower than in 2010, T-HT was once again the most traded share on the Zagreb Stock Exchange, with HRK 1.3 billion of turnover, accounting for 24.1% of the ZSE’s total trade by value of shares in 2011 (2010: HRK 1.5 billion, 25.8%). As at 31 December 2011, T-HT was the second largest company on ZSE, with a market capitalisation HRK 19.8 billion (EUR 2.63 billion) representing 15.2% of the total market capitalization by value (Source: Zagreb Stock Exchange). At the last revision of the CROBEX index, T-HT’s weighting was set at 15% of the index. Besides T-HT shares being listed on the Official Market of the Zagreb Stock Exchange, Global Depositary Receipts (GDRs), each representing one T-HT Share, are traded on London Stock Exchange. In October, at the 21 st annual conference of the Zagreb Stock Exchange, T-HT accepted the second place award for Investor Relations in Croatia 2011 sponsored by popular business newspaper Poslovni dnevnik (2010: first place award for best IR. ) Dividend policy The Dividend policy of the Company was set out in the prospectus that accompanied its Initial Public Offering in October 2007: The future dividend policy should be that any dividends declared and paid in respect of any year following the year in which Offering takes place, shall range from 50% to 100% of the Company’s distributable profits earned in the immediately preceding year. Any annual dividend shall depend on the overall financial position of the Company and its working capital needs at the relevant time (including but not limited to the Company’s business prospects, cash requirements, financial performance, and other factors including tax and regulatory considerations, payment practices of other European telecommunications operators and general economic climate). Dividend for the 2010 financial year On 4 May 2011, the General Assembly of the Company approved a dividend payment to shareholders of HRK 1,863,783,056.60 (HRK 22.76 per share), representing a dividend payout ratio of 100%. The dividend was paid in second half of May 2011. At the end of 2011, this represented a dividend yield of 9.4% on T-HT’s closing price of HRK 242.00. Using the average closing share price over 2011, HRK 265.56, the dividend yield was 8.6%. Introduction
Page 1 and 2: Annual Report 2011
Page 3 and 4: 3 Operating Statistics Key operatio
Page 5: Content 5 2 3 7 8 10 12 16 21 22 28
Page 8 and 9: 8 Letter To Shareholders Introducti
Page 10 and 11: 10 Corporate Profile Introduction A
Page 14 and 15: 14 Dividend proposal for the 2011 f
Page 16 and 17: 16 Management Board Introduction Br
Page 18 and 19: 18 Introduction Branka Skaramuča M
Page 20 and 21: 20 Introduction As a result of the
Page 22 and 23: 22 Supervisory's Board Report Intro
Page 24 and 25: 24 Introduction • Cash management
Page 26 and 27: 26 Summary of the work performed Re
Page 28 and 29: 28 Corporate Governance Code Compli
Page 30 and 31: 30 Introduction Currently the Manag
Page 33 and 34: II. Business review 2011 Croatian T
Page 35 and 36: 35 first 10 months of 2011 against
Page 37 and 38: Regulatory Environment 37 Croatian
Page 39 and 40: Group's Strategy 39 T-HT Group Miss
Page 41 and 42: Organization of the Group 41 T-HT G
Page 43 and 44: 43 Blended ARPU decreased by 11.0%
Page 45 and 46: 45 additional products: naked bitst
Page 47 and 48: 47 Transport Layer DWDM (Dense Wave
Page 49 and 50: 49 Data and IT Security The protect
Page 51 and 52: 51 Corporate Responsibility III. Co
Page 53 and 54: 53 Code of Conduct T-HT’s Code of
Page 55 and 56: 55 Culture Museum of Contemporary A
Page 57 and 58: 57 Full time employees by education
Page 59 and 60: 59 with direct investments into ext
Page 61: 61 In 2011, Iskon was the official
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64 Group Financial Performance Fina
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66 Financial Review 2011 Terminal e
Page 69 and 70:
Consolidated financial statements 3
Page 71 and 72:
Independent auditor’s report 71 T
Page 73 and 74:
Consolidated statement of financial
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Consolidated statement of cash flow
Page 77 and 78:
Notes to the consolidated financial
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79 IAS 39 Financial instruments: Re
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81 two types of joint arrangement:
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83 substance of the tax), the Group
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85 Impairment losses relating to go
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87 k) Leases Leases in which a sign
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89 provided that there are no unful
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91 · Statement of comprehensive in
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93 Revenue — by geographical area
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95 7 Other expenses Maintenance ser
Page 97 and 98:
97 The deferred tax asset of the Gr
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99 The intangible assets of the Gro
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101 Included within assets under co
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103 The movement in investments in
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105 14 Available-for-sale financial
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107 At 1 January Charge for the yea
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109 At 1 January Service costs reco
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111 23 Legal reserves Legal reserve
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113 27 Contingencies At the time of
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115 The main transactions with rela
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117 29 Financial risk management ob
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119 Year ended 31 December 2011 Cro
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121 electronic communications netwo
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123 the achievement of two share va
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125
Page 127 and 128:
127 FINANCING 75 Pojmovnik FRAME RE
Page 129:
129 SUPERVISORY BOARD 7, 9, 14, 18,
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Annual Report 2011 - T-Hrvatski Telekom

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