Annual report 2005 - Sava dd

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| i n t r o d u c t i o n |
In 2005 the Sava Group surpassed the majority
of its plans. These are the results that give
us the impetus to move forward.

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Two years before the expiration of the planned
development strategy we have accomplished the
majority of our goals. The return on capital
surpassed that planned 10 per cent, and the equity
value of the Sava Group rose to €392.4 million.
We are designing bold new plans.

Robert Kranjec,
ski jumper,
Olympic bronze medal winner
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Index
Introduction
1. PROFILE OF THE HOLDING COMPANY SAVA D.D. 8
2. COMPOSITION OF THE SAVA GROUP 9
2.1Changes in the composition of the Sava Group 1
2.2 Associated companies in the Sava Group 11
2.3 Representative offices in the Sava Group 12
2.4 Organisational structure of the Sava Group after the accounting period 12
3. SIGNIFICANT FINANCIAL DATA AND INDICATORS 15
4. A REVIEW OF HIGHLIGHTS 16
4.1A review of highlights in the period January-December 2005 16
4.2 A review of highlights after the accounting period 19
5. REPORT BY THE CHAIRMAN OF THE BOARD 20
6. MANAGEMENT AND ADMINISTRATIVE BODIES 24
6.1Board of Management 24
6.2 Supervisory Board 26
7. REPORT BY THE SUPERVISORY BOARD 29
8. THE CORPORATE GOVERNANCE SYSTEM 34
9. RISK MANAGEMENT 39
9.1Financial risks 40
9.2 Risks related to issued shares of Sava d.d. 42
10. FINANCIAL MANAGEMENT 43
Business Analysis
11. THE SAVA SHARE AND OWNERSHIP STRUCTURE 48
11.1 Movement of the Sava share 48
11.2 Ownership structure of the company 50
11.3 Calendar of more significant announcements 55
11.4 Contact persons 56
12. DEVELOPMENT STRATEGY 57
13. GENERAL ECONOMIC CONDITIONS 61
14. BUSINESS OPERATIONS OF THE SAVA GROUP 62
14.1 Business performance of the Sava Group in 2005 62
14.2 Assets, equity and liabilities of the Sava Group at 31/12/2005 66
15. BUSINESS OPERATIONS BY DIVISION 68
15.1 Rubber Manufacturing division with the Foreign Trade Network 68
15.2 Trade division 72
15.3 Tourism division 76
15.4 Real Estate division 82
15.5 Investment Finance division 86
15.6 Chemicals division 92
15.7 Other companies 93
16. BUSINESS OPERATIONS OF SAVA D.D. 96
17. OUTLOOK FOR 2006 101
18. MARKETING 102
18.1 Managing brand names 102
18.2 Customer policy 103

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| i n t r o d u c t i o n |
19. STRATEGIC PURCHASING AND SUPPLIERS 104
20. DEVELOPMENT ACTIVITIES 106
20.1Development of business processes 106
20.2 Quality of business 107
20.3 Development of information support 109
Sustainable Development Report
21. SUSTAINABLE DEVELOPMENT 112
22. IMPORTANT ACCOMPLISHMENTS 113
22.1 Employees in the Sava Group 113
22.2 Sponsorships for and donations to the social community 114
22.3 Environmental indicators in the Sava Group 115
23. THE DEVELOPMENT OF EMPLOYEES 116
23.1 Concern for employees 116
23.2 Concern for employees outside of working hours 122
23.3 Concern for employee safety and health at work 123
24. STANDARDS AND POLICIES 126
25. IMPORTANT ACKNOWLEDGEMENTS AND AWARDS IN 2005 127
26. DEVELOPING THE SOCIAL COMMUNITY 129
26.1Sponsorship for and donations to the social community 129
26.2 Integration in the social community 132
27. PROTECTING THE ENVIRONMENT AND FIRE SAFETY 133
27.1Environmental protection 133
27.2 Efficient use of energy 135
27.3 Fire safety 138
27.4 Environmental safety in the future 139
Financial Report
28. FINANCIAL STATEMENTS OF THE SAVA GROUP WITH NOTES IN ACCORDANCE
WITH INTERNATIONAL FINANCIAL REPORTING STANDARDS 142
28.1Audited consolidated financial statements of the Sava Group in accordance
with International Financial Reporting Standards 142
28.2 Notes to the financial statements of the Sava Group in accordance
with International Financial Reporting Standards 147
28.3 Statement by the Board of Management 187
28.4 Auditor’s report for the Sava Group 188
29. FINANCIAL STATEMENTS OF THE COMPANY SAVA D.D. WITH NOTES IN
ACCORDANCE WITH SLOVENE ACCOUNTING STANDARDS 189
29.1Audited financial statements of the company Sava d.d. in accordance with
Slovene Accounting Standards 189
29.2 Notes to the financial statements of the company Sava d.d. in accordance with
Slovene Accounting Standards 195
29.3 Statement by the Board of Management 221
29.4 Auditor’s report for the company Sava d.d. 222
STATEMENT ON CONFORMITY WITH THE CORPORATE GOVERNANCE CODE FOR SLOVENIA 223
CONTACT PERSONS 225

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1.
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Profile of the Holding
Company Sava d.d.
Firm: Sava, druœba za upravljanje in financiranje, d.d.
Abbreviated firm: Sava, d.d.
Head office: Ækofjeloæka c. 6, 4000 Kranj, Slovenia
Phone: +386 4 206 50 00
Fax: +386 4 206 64 46
e-mail: info@sava.si
http://www.sava.si
Registration No: 5111358
VAT-ID No: SI75105284
Entry No. in court register: 10024800
Date of entry in court register: 26 April 1996
Share capital of the company as at 31/12/2005: €83,772,596
Nominal value of a share: €42
No. of shares on 31/12/2005: 2,006,987 ordinary freely transferable personal shares
Shares listed on: Ljubljana Stock Exchange, d.d.
Share name: SAVA
Chairman of the Board of Management: Janez Bohoriå
Chairman of the Supervisory Board: Stanislav Valant, M.A.
The nature of our business and most important
activities:
• Managing companies in which Sava d.d. has a
majority or significant ownership share; providing
financing and leasing of real estate; forming and
managing competence centres of knowledge.
• Managing portfolio investments.
• All other commercial business that directly or
indirectly contributes to achieving the goals of the
company and involves the purchase and sale of real
estate, formation of subsidiaries and companies and
take-over of equity in Slovenia and abroad, joining
businesses in an association with commercial interests
and making commercial contracts of all types.

2. Composition of
the Sava Group
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At the end of 2005 the Sava Group consisted of 36
companies, namely the parent company Sava d.d., 32
subsidiaries and 3 joint ventures. The financial
statements of all these companies are included in the
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consolidated financial statements of the Sava Group. In
all companies the capital and voting rights are in
accord.
List of companies that in addition to the parent company Sava d.d. are included in
the Sava Group, with a comparison of ownership stakes at the end of 2005 and 2004.
% stake % stake
Change in
% of stake
31/12/2004 31/12/2005 in 2005
RUBBER MANUFACTURING division
SAVATECH d.o.o., Kranj 100.00% 100.00% 0.00%
SAVA-GTI d.o.o., Kranj 100.00% 100.00% 0.00%
SAVA-ROL d.o.o., Zagreb 76.00% 76.00% 0.00%
SAVA-SCHÄFER d.o.o., Kranj
- FOREIGN TRADE NETWORK
50.00% 50.00% 0.00%
SAVA TRADE VgmbH, Munich, Germany 100.00% 100.00% 0.00%
SAVA TRADE sp.z.o.o., Warsaw, Poland 100.00% 100.00% 0.00%
SAVA TRADE spol.s.o.o., Prague, Czech Republic 100.00% 100.00% 0.00%
SAVATRADE d.o.o., Split, Croatia 70.00% 70.00% 0.00%
EUROSAVATECH S.r.l., Trieste, Italy 90.00% 0.00% -90.00%
SAVATECH TRADE Ltd., London, Great Britain 100.00% 100.00% 0.00%
SAVA TRADE Inc., Port Orange, Florida
CHEMICALS division
95.00% 95.00% 0.00%
SAVA ADVANCED POLYMERS d.o.o., Kranj 51.00% 0.00% -51.00%
TEOL d.d., Kranj
TRADE division
97.33% 98.73% 1.40%
SAVA TRADE, d.d., Ljubljana 94.99% 96.40% 1.41%
- MG Market d.o.o. Ljubljana (owned by Sava Trade d.d.) 74.50% 74.50% 0.00%
- Chemo Zagreb d.o.o., Zagreb (owned by Sava Trade d.d.) 100.00% 100.00% 0.00%
- Chemo Split d.o.o., Split (owned by Sava Trade d.d.) 100.00% 100.00% 0.00%
- Tuzla Kem d.j.l., Tuzla (owned by Sava Trade d.d.) 100.00% 100.00% 0.00%
- Chemo Rijeka d.o.o., Rijeka (owned by Sava Trade d.d.) 100.00% 0.00% -100.00%
- Chemo Skopje d.o.o., Skopje (owned by Sava Trade d.d.) 98.00% 0.00% -98.00%
- Chemo Niœ d.o.o., Niœ (owned by Sava Trade d.d.) 65.00% 65.00% 0.00%
- Chemo Invest d.o.o., Ljubljana (owned by Sava Trade d.d.) 50.00% 0.00% -50.00%
- Argum d.o.o., Tuzla (owned by Sava Trade d.d.) 50.00% 0.00% -50.00%

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TOURISM division
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List of companies that in addition to the parent company Sava d.d. are included in
the Sava Group, with a comparison of ownership stakes at the end of 2005 and 2004.
Change in
% stake % stake % of stake
31/12/2004 31/12/2005 in 2005
GOLF IN KAMP d.d., Bled 91.58% 91.58% 0.00%
GRAND HOTEL TOPLICE BLED d.o.o., Bled 98.88% 99.36% 0.48%
G&P HOTELI BLED d.o.o., Bled 87.40% 95.10% 7.70%
TERME 3000 d.d., Moravske Toplice 96.65% 97.07% 0.42%
- Terme Lendava d.d. (owned by Terme 3000 d.d.) 93.80% 93.02% -0.78%
- Terme Ptuj d.o.o. (owned by Terme 3000 d.d.) 72.00% 72.00% 0.00%
- Terme Radenci d.o.o., Radenci (owned by Terme 3000 d.d.) 100.00% 100.00% 0.00%
REAL ESTATE division
SAVA IP d.o.o., Ljubljana 100.00% 100.00% 0.00%
- IP Nova d.o.o., Ljubljana (owned by SAVA IP d.o.o.) 100.00% 100.00% 0.00%
- IP NOVA A d.o.o., Ljubljana (owned by SAVA IP d.o.o.) 100.00% 100.00% 0.00%
- SAVA IPN d.o.o., Ljubljana (owned by SAVA IP d.o.o.) 100.00% 100.00% 0.00%
- PC AG d.o.o., Velenje (owned by SAVA IP d.o.o.) 50.00% 50.00% 0.00%
- SAVA IMG d.o.o., Pore@ (owned by SAVA IP d.o.o.) 50.00% 50.00% 0.00%
SAVA NOVA d.o.o., Zagreb 100.00% 100.00% 0.00%
SAVA MEDICAL IN STORITVE d.o.o., Kranj 100.00% 100.00% 0.00%
OTHER COMPANIES
GEA SOL International d.o.o., Kranj 100.00% 100.00% 0.00%
BIOOL d.o.o., Kranj 100.00% 100.00% 0.00%
ENERGETIKA SAVA d.o.o., Kranj 100.00% 100.00% 0.00%

2.1
2.2
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Changes in the structure
of the Sava Group
• Rubber Manufacturing with the
foreign trade network
For the company Eurosavatech S.r.l., Trieste, Italy the
liquidation procedure was concluded. The company is
deleted in the court register.
The Rubber Manufacturing companies now operate
through their representative office in Trieste.
• Chemicals division
For the company Sava Advanced Polymers d.o.o. the
liquidation procedure was concluded. The company is
deleted in the court register.
The ownership stake in the company Teol d.d. was
increased by 1.4 per cent due to additional purchases.
• Trade division
Through additional purchases the ownership stake in the
company Sava Trade d.d., Ljubljana was increased by
1.41 per cent.
Associated companies
in the Sava Group
In accordance with the set strategy the holding company
Sava d.d. continued to purchase shares in Gorenjska
Banka d.d., Kranj. On 31December 2005 the ownership
stake amounted to 41.13 per cent, which is 0.19
percentage points higher than last year.
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The companies Chemo Rijeka d.o.o. and Argum d.o.o.
Tuzla were deleted in the court register.
For the company Chemo Skopje d.o.o. the liquidation
procedure was concluded.
The company Argum d.o.o., Tuzla was deleted in the
court register.
The company Chemo Invest d.o.o., Ljubljana was sold.
• Tourism division
By additional purchases the stakes in the company Golf
in Kamp d.d., Bled was enhanced by 0.02 per cent, in
the company Grand Hotel Toplice d.o.o., Bled by 0.48
per cent, in the company G&P Hoteli Bled d.o.o. by 7.7
per cent, in the company Terme 3000 by 0.42 per cent.
The decrease in ownership in the company Terme
3000 d.d., and in the company Terme Lendava d.d. by
0.78 per cent was due to the reconciliation of ownership
stakes with an entry in the Clearing Depot Company.
• Other companies
The company Sava Dva d.o.o. was renamed Energetika
Sava d.o.o.
The company Gumteh & Co. d.o.o., Grosuplje
discontinued to operate.
The companies Terme Lendava d.d. established the
company Turizem Lendava d.o.o. together with other
partners.

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Changes in the ownership of Sava d.d. associates
Representative offices
in the Sava Group
As part of the Sava Group only the company Savatech
d.o.o., Kranj has representative offices, these being in
Moscow and Trieste.
(v 000 SIT)
% stake % stake Change in %
31/12/2004 31/12/2005 of stake in 2005
- Gorenjska Banka d.d., Kranj 40.94% 41.13% 0.19%
- Limb d.o.o., Ptuj 37.50% 37.50% 0.00%
TEOL d.d., Ljubljana – as the parent company
- Teodora d.o.o., Ljubljana 25.00% 25.00% 0.00%
SAVA TRADE d.d., Ljubljana - as the parent company
- Gumitech & CO. d.o.o., Grosuplje 31.00% 0.00% -31.00%
- Astra, Tehni@na Trgovina, d.o.o., Beograd 20.00% 20.00% 0.00%
GOLF IN KAMP BLED d.d., Bled - as the parent company
- Golf Istra d.o.o., Koper 20.00% 20.00% 0.00%
TERME LENDAVA d.d. - as the parent company
- Turizem Lendava d.o.o. 0.00% 33.00% 33.00%
2.3
2.4
Organisational structure
of the Sava Group after
the accounting period
In the beginning of 2006 we slightly restructured the
organisation – the operations of the companies and their
classification. There were no changes either in Rubber
Manufacturing with the foreign trade network or in
Tourism. At the time of preparing the Annual Report,
Trade was still a part of the Sava Group, however, after
selling the companies from the division – Sava Trade
d.d. and MG Market d.o.o., and acquiring a stake in the
Merkur Group, the management of this operation in the
Sava Group will change so as to participate in the profit
of the trading system Merkur, which will be strengthened
through the sold company Sava Trade. The operation of
Chemicals is no longer pursued independently; after
selling the company Color d.d. the division, since the
middle of 2004, has included only the company Teol
d.d., which is now being restructured. The operation of
Teol d.d. will now be pursued as a part of Other
Operations to which also the company for the disabled
Sava Medical & Services d.o.o. was transferred from the
Real Estate division. Other operations include the
emerging company Energetika Sava d.o.o. established

RUBBER MANUFACTURING
SAVATECH d.o.o., Kranj
SAVA ROL d.o.o.,
Zagreb - 76%
SAVA-SCHÄFER d.o.o.,
Kranj - 50%
SAVA-GTI d.o.o., Ptuj
FOREIGN TRADE
NETWORK
SAVA TRADE Gmbh, Munich
SAVA TRADE Sp.z.o.o.,
Warsaw
SAVA TRADE s.r.o., Prague
SAVATECH TRADE Ltd., London
SAVA TRADE Inc.,
Port Orange - 95 %
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in 2005. The company Biool d.o.o. has not yet started to
operate, while the company Gea Sol Int. d.o.o. is
inactive.
The Real Estate division consists of the companies Sava
IP d.o.o. Ljubljana with four subsidiaries and Sava Nova
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d.o.o., Zagreb. The Investment Finance division
manages investments in Sava Group companies and
financial investments as those in associates and other
financial investments.
Organisational structure of the Sava Group (companies on 31 March 2006)
TRADE
SAVA TRADE d.d.
Ljubljana - 96.85%*
MG Market d.o.o.
Ljubljana - 74.50%
SAVA d.d. - HOLDING
BOARD OF MANAGEMENT
DIVISIONS
TOURISM
REAL ESTATE
GOLF IN KAMP BLED d.d., SAVA IP d.o.o., Ljubljana
Bled - 91.60%
IP NOVA d.o.o.,
GRAND HOTEL TOPLICE d.o.o., Ljubljana - 100%
Bled - 99.36%
IP NOVA A d.o.o.,
G & P HOTELI BLED d.o.o.,
Ljubljana - 100%
Bled - 95.10%
SAVA IPN d.o.o.,
TERME 3000 d.d.,
Ljubljana - 100%
Moravske Toplice - 97.07%
PC AG d.o.o.,
TERME LENDAVA d.d., Velenje - 50%
Lendava - 93.02%
SAVA IMG d.o.o.,
TERME PTUJ d.o.o.,
Pore@ - 50%
Ptuj - 72.00%
TERME RADENCI d.o.o.,
Radenci - 100.00%
SAVA NOVA d.o.o., Zagreb
In addition to the parent company Sava d.d. the Sava
Group includes 30 companies. Our operations comprise
six various divisions such as Rubber Manufacturing,
Trade, Tourism, Real Estate, Other Operations and
Investment Finance.
We at the Sava Group continually surpass the
expectations of our customers, employees, shareholders,
business partners and the environment and create
attractive opportunities for employing the best personnel
in Slovenia.
The variety of our operations is associated with the
uniform principles and values that unite us in achieving
common goals.
OTHER OPERATIONS
TEOL d.d., Ljubljana - 98.98%
SAVA MEDICAL AND
SERVICES d.o.o., Kranj
ENERGETIKA SAVA d.o.o.,
Kranj
BIOOL d.o.o., Kranj
GEA SOL Int. d.o.o., Kranj**
Companies under 100% Sava d.d. ownership
INVESTMENT FINANCE
INVESTMENTS IN SAVA
GROUP DIVISIONS
FINANCIAL INVESTMENTS
Investments in associates:
- Gorenjska Banka d.d. - 41.2%
- Limb d.o.o. - 37.50%
Other financial investments
Companies under majority Sava d.d. ownership
* Due to selling the companies in division and acquiring the ownership
stake in the Merkur Group in Trade division will be strategically
restructured in 2006
** The company is stagnant
Rubber Manufacturing includes the companies
Savatech d.o.o., Sava-Schäfer d.o.o, Sava-GTI d.o.o.
and Sava Rol d.o.o. as well as a network of five foreign
trade companies and two representative offices.
We develop innovative products of high quality for
industrial applications. Sava's industrial rubber products
are sought after in the building industry, car industry
(from motorcycles to cars and industrial and agricultural
vehicles), the graphic and paper industry, and
environmental protection.
Trade includes the companies Sava Trade d.d. and MG
Market d.o.o. which deal in trading technical goods and
chemical products as well as DIY products.

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Sava Trade d.d. is present in wholesale and retail sales
under the AstraChemo brand. Its subsidiary, MG Market
d.o.o., provides trading services in large shopping
centres operating under the OBI franchise.
Both trading networks, AstraChemo and OBI, are
successfully expanding throughout Slovenia. The
companies that operate in the Trade division will be sold
in 2006.
Tourism is becoming one of Sava’s strongest
operations. It comprises companies that operate under
the Sava Hotels&Resorts Bled and Pannonian Spas
brands. The companies of Sava Hotels&Resorts Bled
(Golf in Kamp Bled d.d., Grand Hotel Toplice Bled
d.o.o. and G&P Hotels Bled, d.o.o.) have available more
than 60 per cent of the accommodation facilities in Bled.
The Pannonian Spas brand includes five spa resorts in
the north-east of Slovenia: Terme 3000 d.d., Terme
Radenci d.o.o., with Terme Banovci, Terme Ptuj d.o.o.
and Terme Lendava d.d.
Real Estate includes the companies Sava IP d.o.o., IP
Nova d. o. o., IP NovaA d.o.o., Sava IPN d.o.o.,
PCAG d.o.o., Sava IMG d.o.o., and Sava Nova d.o.o.
We construct for the market and lease out our own
properties. A significant part of our operations involves
contracting and providing services to cover the
requirements of the Sava Group.
Other operations includes the companies Teol d.d.,
Sava Medical and Services d.o.o., and Energetika Sava
d.o.o. Teol d.d. manufactures consumer goods,
particularly cleaning agents. A new development trend
is opening up with the production of green fuel –
biodiesel; for this purpose the company Biool d.o.o. was
established. Sava Medical and Services d.o.o. efficiently
provides services that are carried out by disabled
persons and meets the requirements of the Sava Group.
The mission of the newly established company
Energetika Sava d.o.o. is to assure efficient energy
management.
Investment Finance is an operation carried out by the
holding company Sava d.d. Besides managing the
portfolio of Group subsidiaries, the company invests in
profitable financial investments.

3. Significant Financial
Data and Indicators
1 5 |
| i n t r o d u c t i o n |
THE SAVA GROUP
(€ in millions)
Index
According to International Financial Reporting Standards 2004 2005 2005/2004
Sales 236.1 244.0 103
Exports 67.2 75.8 113
Added value 73.4 80.5 110
Total pre-tax profit 52.2 43.7 84*
Net profit 48.6 38.5 79*
Net cash flow (profit + amortisation) 60.3 53.5 89*
Balance sheet total 593.5 651.2 110
Non-current assets 494,0 543.8 110
Current assets 99.5 107.4 108
Equity 378.0 393.0 104
Non-current liabilities 72.2 84.2 116
Current liabilities 143.3 174.0 121
Investment in property, plant and equipment 37.1 37.6 101
Employees – on 31 December
INDICATORS
3,017 3,047 101
Added value / employee - € in thousands 25.5 26.3 103
Total income / operating revenues (%) 21.7 17.1 79*
Total income / equity (%) 17.1 11.9 70*
Net profit / equity (%) 16.0 10.5 66*
Net earnings per share (€) 24.9 19.1 77*
Independence rate (equity / balance sheet total) (%) 64 60 94
Liquidity (current assets / non-current liabilities) (%)
SHARE
62 62 100
Nominal value - (€) 41.7 41.7 100
Book value - (€) 191.0 193.8 101
Market value on 31 December - (€) 183.5 180.4 98
Dividend per a share - (€) 2.6 2.7 103**
* Notes referring to the asterixed items:
The presented 2005 income of the Sava Group calculated in accordance with IFRSs is lower than in 2004, the reason being a single revenue due to the purchase
of the Pannonian Spas companies below their book value. The revenue due to negative goodwill contributed 30% to the created return on capital of the Sava
Group. Not considering this single event, the Sava Group created a net profit that was 8.8 % higher than last year.
- Total income of the Sava Group achieved in 2005 is 14.5% above the plan.
- Net profit of the Sava Group in 2005 is 4.3% above the plan.
- Return on capital of the Sava Group in 2005 amounts to 10.5% and is 0.5 percentage points above the plan, thereby surpassing the target return on capital as
set for the year 2007.
** Proposal by the Shareholders’ Meeting.

a n n u a l r e p o r t | 2 0 0 5
4. A Rewiew of Highlights
4.1
1 6 |
A review of highlights in the period
January-December 2005
January Sava d.d. increases its stake in the companies NFD1, Delniæki Investicijski Sklad, d.d. by 4.98 per
cent and in NFD Holding d.d. by 4.8 per cent. After the purchase Sava d.d. has an 18.48 per cent
stake in NFD 1 d.d. and an 11.63 per cent stake in NFD Holding d.d.
Sava d.d. sells its business stake in the company Geoplin d.o.o. Ljubljana.
Sava IP d.o.o. and the Croatian firm IMG d.o.o. Porefl establish a company under joint ownership
Sava IMG d.o.o.
February The central laboratory of the Development Institute in the company Savatech d.o.o. obtains the
accreditation certificate to prove that the institute meets the requirements as set out in the
SIST EN ISO/IEC 17025 standard.
In the company Terme Lendava d.o.o. a new indoor swimming pool is opened next to Hotel Lipa.
March Sava d.d. acquires 250,593 shares in Laæko Brewery d.d., thereby becoming the owner of a 4.76 per
cent stake in this company.
Camping Bled concludes a partnership with the campsite Wirthshof at Lake Boden in Germany.
Terme Lendava d.d., the Municipality of Lendava and the Lendava Chamber of Trade establish the
company Turizem d.o.o., which deals with tourism promotion in the district of Lendava.
May In Terme 3000 d.d. the enlarged Livada golf course is opened and the construction of a 5* hotel
begins.
The company Sava-Schäfer d.o.o. signs an agent’s contract with the company Schäfer Composites
GmbH, thus acquiring the right to produce and market polyurethane and composite roll covers for
the Central and Eastern European markets.
Based on the results of the national research On the Way to a Learning Company, the Sava Group
wins first place for best achievements in implementing the learning company concept.

1 7 |
| i n t r o d u c t i o n |
June At the 10 th Shareholders’ Meeting Sava’s shareholders confirm the resolution about relieving the
Board of Management and Supervisory Board and vote through a proposal for a dividend in the
amount of €2.59 per a share.
The company Grand Hotel Toplice d.o.o. renews and opens the Pleånik Pavilion Belvedere by Vila
Bled.
In Terme Ptuj a newly built amphitheatre in the thermal water park is opened.
Sava IP d.o.o. acquires a strategic partner, the company Zagrebstan, to expand real estate business
in Zagreb.
July At the 11 th Shareholder’s Meeting Sava shareholders adopt a resolution that it is not necessary to
appoint a special auditor to examine the legitimacy and suitability of legal transactions, which Sava
d.d. over the past five years had concluded with the companies Grand Hotel Toplice d.o.o. and Golf
in Kamp Bled d.d.
The company Sava Trade d.d. signs an agreement on selling its entire 50 per cent share in the
company Chemo Invest d.o.o.
We form a new competence centre EU Projects to support Sava Group companies in identifying
project ideas and preparing final project proposals to obtain non-returnable funding from European
funds for restructuring.
August The new 3* Zeleni Gaj hotel opens in Terme Banovci.
September A newly founded company Energetika Sava d.o.o. starts to operate. It deals with efficiency or
reduction in energy consumption that results in energy savings.
October The company Savatech d.o.o. completes main investments in Rubber Manufacturing, namely the
building of a new office and manufacturing plant to facilitate the development of the programme
that manufactures environmental protection and rescue products.
The building is officially opened by Slovene Prime Minister Janez Janæa.
The management of Sava d.d. hosts Minister of the Environment and Spatial Planning Janez
Podobnik and his associates; they are presented with the achievements in decreasing undesirable
environmental influences and development plans regarding the efficient use of renewable sources.

a n n u a l r e p o r t | 2 0 0 5
1 8 |
The Sava Group sponsors the international conference Manufacturing Visions – Quo Vadis?, in
which we collaborate with experts from the European Union to develop the vision and
recommendations for the policy of evolving the European manufacturing sector in the decades to
come.
At the 52 nd catering tourism meeting our associates from Tourism win 14 gold, 28 silver and
12 bronze medals and receive 9 special awards for their co-operation.
November The Sava Group receives the 2005 award for educational management – TOP 10 awarded by GV
Izobraœevanje and the Sofos Institute to companies that systematically invest in employee education
and thus demonstrate a direct link between an educational and a business strategy.
In a campaign by the Slovene Tourist Association My Country, Beautiful and Hospitable we obtain
numerous acknowledgements: in the category of medium- and small-sized spa resorts Terme Ptuj
wins first place ahead of Terme Lendava; the campsite in Bled wins first place in the category of
large Slovene campsites; and the campsite in Ptuj wins second place in the category of medium- and
large-sized campsites. Terme Ptuj wins second place among large Slovene swimming pools.
We start to renew and modernise Hotel Park, the largest accommodation facility in Bled, which is
the second largest hotel facility in Slovenia.
The companies Terme 3000 d.d, Terme Lendava d.d and Terme Ptuj d.o.o. obtain the quality
assurance certificates according to the ISO 9001:2000 standard, whereas the company Radenci
d.o.o. is certified for conducting business according to the occupational health and safety system
OHSAS 18001.
December We decide to take over general sponsorship for Dr. Preæeren’s birth-place home in Vrba; in this way
we provide resources for the further development of the museum located in this Slovene cultural
monument.
In the companies Sava Hotels & Resorts Bled we complete a plan for information system renewal
and introduce an on-line booking system, which is one of the first in Slovenia.

4.2
1 9 |
| i n t r o d u c t i o n |
A review of highlights after the accounting period
January The company Gea Sol d.o.o. discontinues its business. Based on R&D work and risk assessment we
discontinue planning the production of solar tiles. The vital part of its business – energy consulting
– is transferred to the company Energetika Sava d.o.o.
February The Supervisory Board of Sava d.d. endorses the submitted plan on restructuring Sava Trade. The
plan anticipates that Sava d.d. enters the company Merkur d.d. with a significant ownership stake.
Sava d.d. offers to pay in 98,000 newly issued shares as an increase in the share capital of Merkur
d.d. at a price of €151.1 per a share. The restructuring plan further includes that Sava d.d. offers
Merkur d.d. to purchase the entire ownership stake in Sava Trade d.d. and sell the entire ownership
stake of Sava Trade in the company MG Market d.o.o. Through these transactions Sava d.d. obtains
a significant stake in the company Merkur d.d., while Merkur d.d. consolidates its business through
the operation of the present Sava Trade d.d.
The Supervisory Board of Sava d.d. adopts a resolution that Janez Bohoriå is appointed as chairman
and Vincenc Peråiå and Emil Vizoviæek as members of the Sava d.d. Board of Management for a
new mandate, i.e. from 17 July 2006 until 16 July 2011.
The Sava share is listed in the new South-east Europe index, Southeast Trade Index (SETX) formed
by the Vienna Stock Exchange. Besides Sava d.d., another 13 companies that are listed on the
Ljubljana, Bucharest, Sophia and Zagreb Stock Exchanges are included in the index.
March By increasing the share capital in the company Merkur d.d., Sava d.d. implements a significant part
of its restructuring plan for Trade and becomes the owner of a 19.6 per cent stake and an important
shareholder in this Kranj-based company. By doing so, Sava d.d. will move from the majority-based
management of a smaller company Sava Trade d.d. to the active joint management of a larger
trading system with significantly better conditions for successful development and profitable
operation. This is an important acquisition and opportunity for shareholders of Sava d.d.
In order to acquire quality personnel, the companies of Pannonian Spas unite with professional and
educational institutions in the region in the promotion of catering and tourism professions. At the
same time Pannonian Spas announce 80 new vacancies in a new 5* hotel. Owing to new
investments in the companies of Pannonian Spas another 80 new jobs will be available next year.
Sava d.d. increases the share capital in Grand Hotel Toplice d.o.o. Bled from €1.3 million to about
€2.1million; in the company Savatech d.o.o. from the present €21.1 million to €25.1million, and
in the company Sava-GTI d.o.o. from the present €0.26 million to €0.86 million.
As part of closing the financial transaction of purchasing shares of Merkur d.d. Sava d.d. sold
4,694,946 shares of the company NFD Holding d.d., which represents 14.17 per cent of its equity.
After this sale Sava d.d. does not have any stake in the company NFD Holding d.d.

a n n u a l r e p o r t | 2 0 0 5
5. Report by the Chairman
of the Board
2 0 |
To all Sava shareholders
It is my pleasure to present in the 2005 Annual Report the achievements of another successful business
year, which have been accomplished in a keener competitive environment and founded on the efforts
invested by all associates of the Sava Group in forming long-term operational excellence in all of its
divisions.
Once again Sava has confirmed its high flexibility and adaptability so characteristic for its entire
85-year history. In particular, the ability to adapt and efficiently manage changes is the core of the
accomplished results, by which we surpassed planned growth in several key areas. By that I would
especially like to emphasise the importance of the competence centres of strategic knowledge for the
co-ordinated operation of a diverse business group. They enable the associates in a diversified business
system to rapidly identify changes and opportunities in the business environment, thereby achieving a
high level of response.
The results achieved by the Sava Group by the end of the year prove that the set development strategy
was accomplished in full. At its fore is profitable and sustainable growth accompanied by a higher
employment rate within the Group, efficient handling of natural sources and new long-term plans of
co-operation with the social community.
Financial results reflect the success of the Group
The improved business results, which are revealed by several surpassed growth indicators in the Sava
Group, were accompanied by a positive effect due to a transition from Slovene to International
Financial Reporting Standards.
It is undoubtedly in the interest of shareholders that the value of their investment has been confirmed
by international accounting criteria. It is therefore encouraging that the introduction of the
international accounting methodology has been positively reflected in an increase in the equity value of
the Group as well as in the book share value and net earnings per Sava share, which is why we estimate
that the value of shareholders’ assets has been given a more realistic picture, while at the same time
making the Sava share more attractive to foreign investors.
When dealing with the planned pre-tax profit, the Group has exceeded the plan by 14 per cent and
planned net profit by 4 per cent.
The primary goal to be achieved by the year 2007, i.e. a 10 per cent rate on return on capital invested,
has not just been approached but also fulfilled.

2 1 |
Restructuring accelerates the orientation towards profitability
| i n t r o d u c t i o n |
In the global market only products and services that are most recognisable can break through.
Discovering new market niches and shaping winners in market segments are therefore essential in
achieving the profitable growth of the Sava Group. The business mainstream that directs the entire
present development of the Group would therefore be defined as focusing at all levels of Group
operations, both within the programmes and the Group composition. A 13 per cent increase in exports
and a 10 per cent increase in the created added value prove how significantly we have progressed in
that area and strengthened our competitive power globally.
Such aspirations have been developed best in Rubber Manufacturing, which has strengthened internally
and is focusing on international market niches where it has already become an important player. On
the global scale Rubber Manufacturing is recognisable and perceptible in the markets of scooter and
motorcycle tyres, conveyor belts, rubber profiles and rubber products for environmental protection. By
winning significant market shares, we have secured ourselves the potential for further growth and
consolidating our position.
A greater role for Rubber Manufacturing in the sales structure
As a whole, consolidated sales revenues from services provided and goods sold resulted in a 4 per cent
increase. The result demonstrates that along with restructuring of sales programmes also sales figures
have been enhanced. As forecast, we have consistently strengthened product groups, which assures
innovation and the highest customer satisfaction in selected market segments according to the TOP
3/2/1 principle – to win a leading position in Slovenia, be among the first two in the region and rank
among the first three in Europe and worldwide.
As in the previous year in 2005 too Trade held the leading position in the sales structure with the same
volume of sales. It is followed by Rubber Manufacturing with a 14 per cent increase in net sales
revenues and even a 42 per cent increase in pre-tax profits. Third place belonged to Tourism, which
augmented its income by 3 per cent, accounting for a good one fifth of Group sales. Due to the dynamics
of building for the market Real Estate slightly lagged behind the planned sales figures, while the
company Teol d.d., which is presently being restructured, decreased its sales volume too.
Rounding up the investment cycle and further enhancing the level of quality in
tourist services
In the Sava Group an intensive investment period is under way, during which the volume of investments
in fixed assets has reached €38 million for the second time in succession. A similar investment volume is

a n n u a l r e p o r t | 2 0 0 5
2 2 |
envisaged for 2006 when the present investment cycle is to be completed. The major part or a good half
of investment assets is earmarked for the accelerated development of tourism amenities in both
destinations, Bled and Pannonian Spas. The investment cycle that began in Bled, where the renovation
of the entire range of services infrastructure is currently being completed, comprised the modernisation
and expansion of high-quality hotel, catering, wellness and golf facilities. Investments in the tourism
infrastructure in Pannonian Spas will round off the cycle.
The renovation of facilities represents the foundation, but not the only factor that is vital to increase
profitability in the tourism industry. As one of the central and, according to some criteria, even the
leading provider of tourist services in Slovenia we realise that a breakthrough in quality tourist services
is inevitable, since Slovenia as a tourist destination has many opportunities in this area. Only after
completing this task, which includes increasing the level of quality of knowledge, organisation,
marketing and advertising, will it be possible to accomplish an increase in profitability as planned.
Therefore future investments in tourism will be directed towards the aforementioned factors. We are
also counting on assistance and collaboration from the state and establishing links with tourism
organisations in Slovenia, particularly in the area of marketing, purchasing and real estate.
Forecast of changes in the Sava Group
Investments in Tourism place distinguished products and operations with higher added value in focus.
Yet, this process should not be discussed only in terms of operations and programmes, but also at the
highest level – the structure of the Sava Group. In 2004 we sold our main investment in Chemicals, in
the coatings industry, to which we adapted by excluding Chemicals as an independent division.
Although the year passed without any other great change in the Group’s internal structure, it was time
to make a decision and conclude agreements on how to encourage the development of Trade as a
strategic operation. However, as assumed in the strategy outlined for the first period of the
restructuring process in the Sava Group, Trade should have utilised significant favourable effects from
internal links with Chemicals. The result was an agreement with the trading enterprise Merkur
concluded in February 2006. The investment in Trade will be replaced by playing an active role in
managing this trading enterprise, in which we have acquired a one fifth stake. Consequently, the
decision to restructure the division and sell the entire business stake in the companies Sava Trade d.d.
and MG Market d.d. presents the logical continuation of selling our investment in Chemicals and the
coatings industry, respectively, on which this operation was founded.
The business in Real Estate is conducted in the direction outlined, the division becoming ever more
present in the Croatian real estate market.
Preparations for future changes
In addition to the agreed upon and envisaged restructuring of real investment in Trade and its exclusion
from the Sava Group we are not planning any other more significant changes in the Group’s
composition in 2006, being conditioned by favourable market opportunities. Yet we admit to responding
to opportunities that allow the expansion of Rubber Manufacturing. In this division future development
is based on investments or external growth through acquisitions in new markets, with a parallel
increase in the share of Rubber Manufacturing in consolidated sales.
The shift in the Group’s composition that is restructuring real investment in Trade into a financial
investment will have a considerable impact on business achievements and indicators of the Group in 2006.
For shareholders and the holding company Sava it is of paramount importance that capital invested in
trade operations through its transfers under financial investments will win on profitability and further
improve the structure and have a positive effect with investments in the Investment Finance division.
The restructuring will have the strongest influence on the volume of consolidated revenues of the Group,
which will be reduced by a good third.

2 3 |
| i n t r o d u c t i o n |
However, the volume of revenues, if a comparison is made with the same composition of the Group in
the past years, would demonstrate growth. There is another important aspect concerning the
restructuring of Trade: we shall enhance operating profit in the operations of our subsidiaries by 1.3
percentage points. By restructuring the Sava Group we are therefore continuing to implement a
profitable growth strategy.
Profitability as a non-linear indicator
It is worth emphasising that return on capital as an important criterion for the success of the Sava
Group with regard to the holding management and organisation of the Group is not an indicator that
grows in linear terms, but it is fluctuating. In the past two years profitability was appreciably high,
reaching 16 per cent in 2004, and 10.5 per cent in 2005. The achieved profitability level is substantially
affected by favourable purchases of new real investments or an increase in stakes in such investments,
as we have witnessed during these years, thereby creating single operating revenues in the form of
effects due to the elimination of negative goodwill. In 2006 we do not anticipate any larger sale of
financial investments, therefore the profit planned for the Sava Group and the company Sava is lower.
Nevertheless, it is planned to increase in the years ahead at an average annual rate of 6 per cent. The
planned return on capital is lower as well. Despite the mentioned fluctuation, the present direction of
the Group means progress towards stable and profitable growth of the selected operations.
Success in implementing the adopted dividend policy
The Investment Finance operation being performed by the holding company Sava continues to be of
importance for the Sava Group. Among its long-term financial investments the holding company holds
quality and profitable investments such as a stake in Gorenjska Banka d.d., in which it appears as a
strategic owner. Also in future the holding company will seek ownership stakes in financial institutions,
not to mention that it already has available a strong liquid and profitable portfolio of securities.
In 2006 we do not plan to sell any important portfolio investments, therefore the profit of the Group is
planned at a lower level and should reach €29 million. The balance of business operations, favourable
financial position, rich financial investment portfolio, which provides opportunities for future gains,
and an increase in operating profitability in business assures that Sava further meets the adopted
development and dividend policy on a consistent basis. The policy anticipates that the dividend paid for
the Sava share will undergo continual and stable growth.
The confidence that investors have is due to the structure of Sava’s assets and the successful
implementation of the development strategy, originating from the efficient management of its strategic
investment areas. This is at the same time the reason for the market value of the Sava share being less
sensitive to unfavourable movements as experienced by the SBI 20 index on the Ljubljana Stock
Exchange. In the international business environment Sava is renowned as a successful company with a
long-term development programme, which has been proven by the Sava share being included in a new
South-east Trade Index (SETX).
Preparations for profitable growth in the future development period
In February the Supervisory Board gave the Board of Management of Sava d.d. another 5-year mandate
until the year 2011 and entrusted it with the preparation of a development strategy for the next period.
The preparation for individual operations is underway. The strategy for the entire Group, which will
comprise the period from 2007 to 2011 before the end of the year, will be submitted to the Supervisory
Board. By designing new steps in the strategy of Sava’s profitable growth, the Sava Group and the
holding company Sava will continue to implement the adopted sustainable development vision to the
satisfaction of customers, employees, shareholders and the environment.
Janez Bohoriå,
Chairman of the Board of Management
Sava d.d.

a n n u a l r e p o r t | 2 0 0 5
6. Management and
Administrative Bodies
6.1
2 4 |
Board of Management
Janez Bohori@
Chairman
Janez Bohori@
The 64-year-old Chairman of the Board of Management of Sava d.d graduated in
chemical engineering and has been employed at Sava for 40 years. Since 1996 he has
been Chairman of the Board and is responsible for the strategic development of
operations, finance and risk management, marketing, human resources, law,
organisation and corporate communications, as well as Investment Finance operations.
In February 2006 the Supervisory Board extended his mandate until July 2011.
During 1984 and 1990 he was vice-president of the then Slovene government responsible
for the economy.
Janez Bohoriå is also chairman of the Slovene Chamber of Commerce and Industry,
member of the Learning Company Institute board, deputy chairman of the awards
committee of the Republic of Slovenia for Business Excellence, member and honorary
member of many organisations, the founder of Lionism in Slovenia and Coordinating Lion
for the development of Lionism in Macedonia, member of the Regional Development
Council of Gorenjsko, councillor in the Municipality of Kranj and member of the local
community of Straœiæåe, member of the honorary arbitration court of the Managers’
Association, honorary member of the Slovene Tourism Association and member of the
Economy Collegiate Body at Ljubljana University.
Membership of the Supervisory Boards:
• chairman of the Supervisory Board NFD Holding d.d., Ljubljana
• member of the Supervisory Board of Pokojninska Druœba A d.d., Ljubljana
• member of the board of Golnik Hospital
Membership of the Supervisory Boards of Sava Group companies:
• chairman of the Supervisory Board of Terme 3000 d.d., Moravske Toplice
• chairman of the Supervisory Board of Sava Trade d.d., Ljubljana

2 5 |
Vinko Per@i@ Emil Vizoviœek
Vinko Per@i@
Member
Emil Vizoviœek
Member
| i n t r o d u c t i o n |
The 62-year-old university economics graduate has been employed at Sava for 42 years.
He has been a member of the Board since 1996 and in February 2006 the Supervisory
Board extended his mandate until July 2011. He is responsible for the development of
planning systems and monitoring business operations, the development of informatics
and purchasing as well operations in the Tourism and Real Estate divisions.
Vinko Peråiå is also chairman of the Slovene Auditing Institute council, member of the
board of the Federation of Accountants, Financiers and Auditors of the Republic of
Slovenia, chairman of the Society of Accountants and Financiers in Kranj, member of the
Managers’ Association and president of Sava Cycling Club.
Membership of the Supervisory Boards:
• chairman of the Supervisory Board of the company Domel d.d., Œelezniki
Membership of the Supervisory Boards of Sava Group companies:
• chairman of the Supervisory Board of Golf in Kamp Bled d.d., Bled
• chairman of the Supervisory Board of Grand Hotel Toplice d.o.o., Bled
• chairman of the Supervisory Board of G&P Hoteli Bled, d.o.o., Bled
• member of the Supervisory Board of Terme 3000 d.d., Moravske Toplice
• member of the Supervisory Board of Sava Trade d.d., Ljubljana
The 61-year-old university graduate in chemical technology has been employed at Sava
for 30 years. He has been a member of the Board since 1996, and in February 2006 the
Supervisory Board extended his mandate until July 2011. He is responsible for the
development of quality management systems, research and development as well as the
continual improvements system, for the development and supervision of Rubber
Manufacturing operations with the foreign trade network and new development plans.
Between 1988 and 1994 he managed production at Semperit, a partner of the car tyre plant
Sava Semperit.
Emil Vizoviæek is also a member of the board of the Association of Chemical Industries at
the Slovene Chamber of Commerce and Industry, member of the board of the Technical
Museum of Slovenia, member of the Managers’ Association, member of the board of the
National Foundation for Business Excellence and member of the economy commission of
the Slovene Business and Research Association with its head office in Brussels.
Membership of the Supervisory Boards of Sava Group companies:
• chairman of the Supervisory Board of Teol d.d.
• chairman of the Supervisory Board of Limb d.o.o., Ptuj

a n n u a l r e p o r t | 2 0 0 5
6.2
2 6 |
Supervisory Board
Stanislav Valant, M.A.
Chairman
Miran Kal@i@
Deputy Chairman
Stanislav Valant, M.A.
The 56-year-old university graduate in economics and Master of Business
Administration is chairman of the Board of Management of Nacionalna
Finanåna Druœba d.o.o., Ljubljana.
His more important managerial experience comprises the membership of the
Board of Management in Ljubljanska Banka d.d., Ljubljana, leading the project
for establishing the Ljubljana Stock Exchange d.d., Ljubljana and presiding over
the Slovene Banks Association.
Prominent current functions:
• chairman of the Association of Management Companies, Ljubljana
• honorary chairman of the Supervisory Board of the Ljubljana Stock Exchange
d.d., Ljubljana
• chairman of the Supervisory Board of Etol d.d., Celje and Hoteli Bernardin d.d.,
Portoroœ
• member of the Supervisory Board of NFD Holding d.d., Ljubljana
• president of the Slovene Ski Association
The 58-year-old university graduate in law is director of the Institute for Work
Safety d.d. Ljubljana.
He was director of the specialised services sector in Hermes, Foreign Companies
Representation d.o.o., Ljubljana, director of implementing insurance at the
Institute of Pension and Disability Insurance of Slovenia, chairman of the
Republic Committee for Work and member of the Executive Council of the
Republic of Slovenia, head of the project for establishing the pensions company
at SKB d.d. Ljubljana and chairman of its temporary board, deputy general
director at the Institute of Pension and Disability Insurance of Slovenia.
Prominent current functions:
• vice-chairman of the Government of the Republic of Slovenia Board for Disabled
Persons
• chairman of the Committee for Closed Mutual Pension Funds for Public
Employees in the Republic of Slovenia
• member of the team for reforming of the pension insurance system at the Ministry
of Labour, Family and Social Affairs

2 7 |
Goran Bizjak
Member - shareholder
representative
Janez Bojc
Member - shareholder
representative
Janko Kastelic
Member - shareholder
representative
| i n t r o d u c t i o n |
The 47-year-old university graduate in economics is procurator in the company
Candor d.o.o.
He was assistant to the director of the Fund of the Republic of Slovenia for
developing small businesses and head of the sector for preparing and managing
the budget of the Republic of Slovenia.
Prominent current function:
• member of the Supervisory Board of Triglav Insurance d.d., Ljubljana
The 44-year-old university graduate in economics is deputy director of the
companies KD Group d.d. and KD Holding d.d., Ljubljana.
He was director of Ljubljana Kinematografi d.d. Ljubljana, assistant to the
director of Zadruœna Kmetijska Druœba d.o.o. Ljubljana, deputy director of KD
Group d.d., Ljubljana, director of KD Holding d.d. Ljubljana, director of KD
Investments d.d., Ljubljana and until 3 May 2005 member of the Supervisory
Board of the company Droga d.d., Izola.
Prominent current functions:
• chairman of the Supervisory Board of the insurance company Adriatic
Slovenica d.d., Koper
• chairman of the Supervisory Board of the company Œito d.d., Ljubljana
The 56-year-old university graduate in economics is director of the company
Fidina d.d. Ljubljana.
He was assistant to the managing director of the company Slovenijales, advisor
in Triglav Insurance d.d., Ljubljana, and chairman of the fund management
company DZU Triglav.
Prominent current function:
• member of the Supervisory Board of Terme Åateœ d.d., Åateœ ob Savi

a n n u a l r e p o r t | 2 0 0 5
2 8 |
Toma¡ Kuntari@, M.A.
Member - shareholder
representative
Janez Justin
Member – employee
representative
Jo¡ef Copek
Member – employee
representative
Miha Resman
Member – employee
representative
The 40-year-old university graduate in law, Master of Business Administration is
assistant to the president of the Board of Management of Gorenje d.d., Velenje.
He was director of the legal department in Kapitalska Druœba d.d., Ljubljana and
advisor to the sector director of the Institute for Pension and Disability Insurance
of Slovenia.
The 60-year old mechanical technician is president of the Trade Union for
Chemical, Non-metal and Rubber Manufacturing industry (KNG) Sava-
Goodyear.
He was president of KNG Slovenia, board member of the European Mine,
Chemical and Energy Workers’ Federation (EMCEF), board member of the
International Federation of Chemical, Energy, Mine and General Workers'
Unions (ICEM), member of the negotiating teams for collective agreements for
chemical and rubber manufacturing and non-metal industry of Slovenia, and
member of the negotiating team of employees in EMCEF negotiating with the EU
directorates.
The 60-year-old university graduate in labour organisation is retired.
He was director of the general sector in Sava d.d., Kranj and director of the
company Sava Medical and Services d.o.o., Kranj in the Sava Group.
The 30-year-old university graduate in economics is head of financial
investments in the Strategic Finance of the company Sava d.d. Kranj.
He was head of relations with investors and member of the expert team for
take-overs and mergers.
Prominent current functions:
• member of the Supervisory Board of Limb d.o.o., Ptuj
• chairman of the Workers’ Council of Sava d.d., Kranj

7. Report by the
Supervisory Board
2 9 |
| i n t r o d u c t i o n |
on the result of examining the audited 2005 Annual Report,
2005 consolidated Annual Report of the Sava Group and
the proposal for using the accumulated profit 2005
Components of the Annual Report and the Consolidated Annual Report
The Supervisory Board of the joint stock company Sava has reviewed the formal aspects concerning the
2005 Annual Report from the Board of Management and the Consolidated Annual Report for 2005.
It has determined that the 2005 Annual Reports were produced within the legal deadline and contain all
the obligatory components as prescribed by the currently valid Law on Economic Enterprises. The Annual
Report consists of the financial report that includes the Balance Sheet, Income Statement, enclosures with
notes to all the statements, Cash Flow Statement, Statement of Changes in Equity and the business report.
The Consolidated Annual Report consists of all the prescribed contents too, whereby it stands that the
Business Report is common to both the Annual Report and the Consolidated Annual Report. All the
essential constituents that are prescribed by legislation to produce the individual statements and reports
are contained in the Annual Report. The company has correctly created legal reserves and reserves for its
treasury shares. The explanations to the financial statements contain all the information prescribed by the
Law on Economic Enterprises in Items 1 to 19 of Paragraph 1, Article 65. The Business Report contains
all the significant business events that took place after the end of the business year, anticipated growth of
the company and operations of the Sava Group in the field of research and development and data about the
subsidiaries of the company. The Business Report contains an in-depth analysis on the material risks and
uncertainties that the company is exposed to.
The Annual Report was submitted for auditing to a selected auditor at the 10 th Shareholders' Meeting of the
joint stock company. The auditors KPMG d.o.o. produced an Auditors' Report on 8 April 2006.
Paragraph 3 of Article 256 of the Law on Economic Enterprises prescribes that the Board of Management
must present the compiled Annual Report together with the Auditors' Report to the Supervisory Board
without delay. The Board of Management of Sava d.d. did this on 13 April 2006. We therefore determine
that the aforementioned legal provision was observed.
Method and scope of examining the management of the company
The Supervisory Board performed its supervisory function mainly at Supervisory Board meetings. It also
established a review commission to prepare the written report from the Supervisory Board on the 2005
Annual Report and other tasks in accordance with the Code of Corporate Governance for Slovenia. The
commission consisted exclusively of Supervisory Board members, whereas the associates of the company,
including the internal auditor, collaborated in its work.

a n n u a l r e p o r t | 2 0 0 5
3 0 |
The Supervisory Board held seven regular meetings. At these meetings individual members of the
Supervisory Board exercised their right under Paragraph 1, Article 274(a) of the Law on Economic
Enterprises, which enables all members of the Supervisory Board to examine all the bases for producing
the Annual Report. In accordance with the legal provision the Supervisory Board has the right to revoke
such a right from an individual member, but the Supervisory Board did not adopt any resolution on this
matter in 2005.
The Supervisory Board meetings in 2005 took place on 17 February, 22 April, 17 May, 7 July, 25 August,
and 15 December.
The most important resolutions of the Supervisory Board
The Supervisory Board pursued and adopted resolutions about the most important matters on a regular
basis. A summary of other more important resolutions of individual meetings of the Supervisory Board (in
chronological order) is given in the following wording:
• The Supervisory Board became acquainted with the 2005 Business Plan together with a projection for
2006 and 2007 (4 th meeting).
• The Supervisory Board motioned the proposal by the Board to allocate 50% of the accumulated profit
2004 remaining after the use of the net profit for the purpose under Paragraph 1, Article 228 of the Law
on Economic Enterprises to other revenue reserves;
• The Supervisory Board confirmed and endorsed the audited 2004 Annual Report from the Board of
Management, audited consolidated 2004 Annual Report and a written report by the Supervisory Board
about the annual report from the Board of Management for 2004, the consolidated 2004 Annual Report
and the proposal for using the accumulated profit (5 th meeting).
• The Supervisory Board motioned the proposal by the Board of Management about distribution of
accumulated profit;
• The Supervisory Board proposed to the Shareholders’ Meeting to extend the period for the unused part
of the approved capital by another 5 years;
• The Supervisory Board estimated that appointing a special auditor for examining individual transactions
of the company was not needed (6 th meeting).
• The Supervisory Board prepared written standpoints with regard to the demand for appointing a special
auditor and made the chairman of the Supervisory Board in charge of presenting the standpoints in the
extraordinary meeting (7 th meeting);
• The Supervisory Board became acquainted with the bi-annual report on business operations for the
period January-June 2005 (9 th meeting).
• The Supervisory Board appointed the members of the review and personnel commission (10 th meeting).
In addition to that the Supervisory Board pursued and, if required, adopted required resolutions about
long- and short-term financial investments, treasury shares, share price and the movement of the

3 1 |
| i n t r o d u c t i o n |
shareholders’ structure. After each Supervisory Board meeting the minutes of the meeting were prepared
and were adopted with a resolution.
Reporting by the Board of Management
In the 2005 business year reporting by the Board of Management enabled the Supervisory Board to suitably
implement its supervisory role. The reports by the Board of Management were usually produced according
to individual areas with a synthetic review of all business impacts. These involved the operations of the
divisions: Rubber Manufacturing with the Foreign Trade Network, Trade, Tourism, Real Estate and
Investment Finance, thereby enabling one to monitor the positive and negative effects of individual
operations of the Sava Group.
The Supervisory Board was also allowed to make a review of individual companies or production and
service programmes within individual divisions. The interest of the Supervisory Board primarily referred
to the business operations of larger companies and production programmes and the consolidated
statements of the entire Group.
In its reports the Board of Management presented all the most important categories that affect the business
of the joint stock company Sava. These are the categories of profit, turnover, costs, added value, etc.
Furthermore, comparative statements for the previous year and planned statements for the current and
future two years were added to the statement for 2005. In this way the Supervisory Board could
continuously examine the trend with respect to the past and planned business performance.
Business performance assessment
The Supervisory Board examined the business operations of Sava d.d. and the Sava Group during the year
based on the submitted 2005 Annual Report, which for the Sava Group was prepared in accordance with
International Financial Reporting Standards for the first time. By doing so the results and assets of the Sava
Group were presented in a more realistic manner, since the major part of assets was shown at the fair value
principle. The use of new standards had a favourable effect on the shown return on capital of the Sava
Group, which in 2005 surpassed 10 per cent as planned in the strategy for the year 2007. The equity value
presented in balance sheets of the Sava Group increased to more than €392 million or €193.8 per share.
Irrespective of the single effect due to the transition to new financial standards it is to be ascertained in
every case that the Sava Group in 2005 operated successfully and all key performance indicators of the
Group surpassed the planned value. The comparison of values and business indicators does not show a
suitable increase with regard to the past year, the reason being the negative goodwill shown under
revenues for the year 2004 on account of the purchase of companies operating under the Pannonian Spas
brand (it involved a single event connected with entering into the ownership structure).

a n n u a l r e p o r t | 2 0 0 5
3 2 |
The Supervisory Board of Sava d.d. analysed the movement of certain significant financial data and
indicators, which show business success and ascertained:
• net sales revenues in the Sava Group were achieved at €244 million and 4 per cent above last year and
3 per cent below the plan;
• The pre-tax profit of the Sava Group totalling €43.7 million was 14.5 per cent higher than planned or 20.9
per cent lower than last year’s profit;
• Net profit of the Sava Group for 2005 was generated in the amount of €38.5 million and was 4.3 per cent
above plan. In comparison with last year it was 20.9 per cent lower. Not considering the negative
goodwill, the Sava Group in 2005 generated a net profit that was 8.8 per cent higher than last year.
• Return on capital of the Sava Group, calculated as the ratio between pre-tax profit and average balance
of equity, amounted to 11.9 per cent and was 5.2 percentage points lower than last year.
• Return on capital of the Sava Group calculated as the ratio between net profit and average balance of
equity amounted to 10.5 per cent and was 5.5 percentage points lower than last year. The achieved return
on capital was 0.5 percentage points above the planned return in 2005.
• On 31 December 2005 the Sava Group employed 3,047 employees, or 1 per cent more than last year.
The Supervisory Board ascertains that the Board of Management of the company was successful in 2005
as all the key goals were implemented both in Sava d.d. and the Sava Group. Very good results of the Sava
Group for 2005 according to IFRSs were due to successful operation and the application of new standards,
which show the income and value of the assets in a considerably different manner. It is not anticipated that
such a single event will be repeated in the coming years.
The Supervisory Board estimated that the Board accomplished a material portion of business goals from
the four-year development strategy prior to the deadline, however, certain important changes appeared in
the strategy implementation that demand a revision of the current strategic development goals. The key
elements of these changes are:
• The Board of Management revised the adopted strategy of Trade by selling the entire operation and as
an important shareholder entered in the ownership structure of the largest domestic trader with technical
goods – the company Merkur. The decision will have a positive effect on the success of the Sava Group
and resulted from the sale of the company Color d.d. as the largest investment in Chemicals. This year
the Board of Management will seek an optimum solution for the remaining company from the division,
i.e. Teol d.d.;
• As far as the volume of the invested capital is concerned the Tourism division has become the second most
important operation of the Group following Investment Finance. In the following period the Board will
focus on increasing the return on capital invested by rationalising operations, synergies from a joint
appearance and suitable positioning in Slovene tourism;
• Investment Finance is the operation with a key contribution to the successful operation and profitability
of the entire Sava Group. The future divestitures of the investments and investment in other existing or
new operations will be realised within the adopted strategy and on the basis of the economic study and
the established comparative advantages of the business system as a whole.
In the business year 2006 the company will have to revise the adopted strategy for the period 2004-2007
with regard to the aforementioned and already performed revisions from the previous year also due to the
dynamic changes in the market and the necessity for rapid adaptation. The Supervisory Board ascertained
that the development strategy should be revised on an annual basis.
Proposal for using accumulated profit
The Supervisory Board examined the proposal for using accumulated profit.
It ascertained that the profit was distributed in accordance with Article 228 of the Law on Economic

3 3 |
| i n t r o d u c t i o n |
Enterprises, while the proposal for using accumulated profit comprises the data prescribed in the fourth
paragraph of Article 282 of the aforementioned law.
The Supervisory Board assessed whether there was a possibility for challenging such a resolution about
using accumulated profit in line with the first paragraph of Article 368 of the Law on Economic
Enterprises. It determined that there was no such possibility, since the proposal by the Board of
Management anticipated that the amount of €5,352,661 was distributed to shareholders, which is the
amount exceeding 4 per cent of share capital in cumulative terms totalling €3,350,904.
When endorsing the Annual Report, the Supervisory Board supported the proposal by the Board of
Management to form other reserves for one half of the net profit that remains after using accumulated profit
for the purposes from the first paragraph of Article 228 of the Law on Economic Enterprises.
Based on the third paragraph of Article 286 of the Law on Economic Enterprises, the Supervisory Board
proposed that the Shareholders’ Meeting adopt a resolution on using accumulated profit as proposed by
the Board of Management.
Auditor's report
The Supervisory Board has examined the Auditor's report and determined that the auditor's opinion is an
affirmative one.
The auditor has also presented his views in the report to the Supervisory Board and collaborated in the
meeting of the auditing commission of the Supervisory Board.
The Supervisory Board has no comments on the Auditor's Report. It determines that the Auditor’s Report
contains the constituents prescribed in the second paragraph of Article 54 of the Law on Economic
Enterprises. The auditor has confirmed that the financial reports have been produced in accordance with
Slovene Accounting Standards, the accounting policies of the company and by employing corresponding
provisions of International Accounting Standards.
Comments of the Supervisory Board on the 2005 Annual Report and the
2005 Consolidated Annual Report
The Supervisory Board has no comments on the 2005 Annual Report and the 2005 Consolidated Annual
Report that would delay the adoption of a decision to endorse the Annual Report and the Consolidated
Annual Report.
Endorsement of the 2005 Annual Report and the Consolidated Annual Report
The Supervisory Board hereby endorses the 2005 Annual Report and the 2005 Consolidated Annual Report
of the Sava Group.
The Supervisory Board received the 2005 Annual Reports within an open deadline, i.e. before one month
expires including the day the 2005 Annual Reports were submitted to the Supervisory Board.
20 April 2006
Stanislav Valant, M.A.
Chairman of the Supervisory Board

a n n u a l r e p o r t | 2 0 0 5
8. The Corporate
Governance System
3 4 |
The corporate governance system of Sava d.d. refers to the operation of its executive bodies with the aim of
contributing to the efficient implementation of business goals and communication with shareholders and other
partners to the greatest extent possible. In this way their confidence in our operation is strengthened. The
management of the company Sava d.d. and its subsidiaries is based on legal provisions, the regulations of the
Ljubljana Stock Exchange, and internal organisational rules and regulations while employing and
transferring good business practice.
Two-tier corporate governance
system in the companies of the
Sava Group
Through efficient governance and management we
create a competitive edge for Sava Group companies.
Sava d.d. is managed according to a two-tier system, for
which it is characteristic that the company is conducted
by the Board of Management, while its operation is
supervised by the Supervisory Board. The Group’s
subsidiaries, which are organised as joint-stock
companies, are managed in the same way, as are the
subsidiaries with limited liability.
Shareholders’ Meeting
of Sava d.d.
Shareholders of the company exercise their rights in
company matters through the Shareholders’ Meeting.
Convening meetings and dealing with other matters of
importance for their performance is determined by the
company statute in accordance with current legislation.
The entire wording of the statute is announced on the
Sava d.d. website: http://www.sava.si/1/1d/frame3.htm.
The Shareholders’ Meeting is convened by the Board of
Management of Sava d.d., once per year, as a rule. It may
be attended by all shareholders or persons authorised by
shareholders, or agents who at least three days prior to the
Shareholders’ Meeting announce their participation in
writing. The Shareholders’ Meeting convocation is
announced at least 30 days prior to the meeting in the
Official Gazette, Finance magazine, in the electronic
information system SEOnet of the Ljubljana Stock
Exchange d.d., and on the company websites.
At the 11 th annual Shareholders’ Meeting that took place
on 1June 2005 shareholders of Sava d.d. made a
decision about appropriating profit, relieving the Board
of Management and Supervisory Board and appointing
an auditor. On request from one of the largest
shareholders an extraordinary Shareholders’ Meeting
was convened on 13 July 2005, in which shareholders
decided to appoint a special auditor for examining the
business of Sava d.d. with its subsidiary Grand Hotel
Toplice d.o.o. and the company Golf in Kamp Bled
d.o.o. over a period of the last five years. Shareholders
rejected the proposal by a two-thirds majority. All
business was namely already revealed and examined by
the authorised auditors, who did not find any
irregularities, while the compulsory settlement
procedure was conducted by the competent court.
Supervisory Board of Sava d.d.
The Supervisory Board of the company includes nine
members. Six members, shareholders’ representatives,
are elected by the Shareholders’ Meeting, while
members and employee representatives are elected by
the Workers’ Council in accordance with the law on
employee participation in management.
The Supervisory Board members are elected for a
mandate of four years with the possibility of being
repeatedly elected. The Supervisory Board shall meet at

3 5 |
least once per quarter, or obligatorily once per half year.
At Sava d.d. the Supervisory Board meets at least in five
regular meetings annually.
It is common practice that the Supervisory Board appoints
a commission for the preparation of a Supervisory Board
report on the annual report and a proposal about profit
appropriation as well as its own audit commission. The
scope of business of this commission corresponds to the
code recommendation, namely, for the Supervisory Board
to form an audit commission. The audit commission team
that is composed of the commission chairman Janko
Kastelic and members Stanislav Valant, M.A., and Miha
Resman, reviewed the annual report, discussed the matter
with the auditor and prepared a proposal for the
Supervisory Board report.
At its last meeting in 2005 the Supervisory Board
appointed a personnel commission, which by the first
meeting in 2006 drafted a proposal to appoint a new
Board of Management. The personnel commission
members, Miran Kalåiå, Stanislav Valant, M.A., and
Joœef Copek, extended the mandate of the present Board
of Management by a new mandate period.
The method of working, convocation of meetings and
other matters of importance for the work of the
Supervisory Board of the company Sava d.d. are set out
in the statute of the company and the regulations
governing its work.
Board of Management
of Sava d.d.
The company Sava d.d. is led by a three-member Board
of Management who is appointed by the Supervisory
Board and whose mandate is five years with an
unlimited possibility for repeated appointment. The
present Board of Management begins its new mandate
on 17 July 2006 and ends it on 16 July 2011.
The Board of Management runs Sava d.d. by conducting
business for the benefit of the company in a self-
| i n t r o d u c t i o n |
dependent manner and on their own responsibility. The
number of Board of Management members and their
scope of business and authority are determined by a
Supervisory Board resolution and form a constituent
part of the Board of Management regulations.
The Board of Management reports to the Supervisory
Board on a regular basis, in an understandable manner
and on time on all significant questions in relation to the
operations of the company and the Sava Group. The
Board of Management and Supervisory Board reconcile
their opinions as regards designing and implementing
the corporate strategy. For certain decisions and
transactions, respectively, the Board of Management has
to acquire approval from the Supervisory Board; such
transactions are purchase of ownership stakes that
exceed 20 per cent of Sava d.d.’s share capital, and an
increase in the share capital from approved capital.
Sava d.d. has two procurators. Their mandate coincides
with the mandate of the current Board of Management.
They represent the company together with one member
of the Board of Management. The procurators have no
limitations other than legal limitations in representing
the company in real estate business and the provision of
joint representation.
Governing and managing the
subsidiaries of the Sava Group
The Sava Group is composed of the controlling
company Sava d.d., its subsidiaries, in which the
controlling company holds, directly and indirectly, a
majority stake, and joint ventures, which the parent
company manages together with other joint owners.
The key task of the Sava d.d. management is to assure
efficient company management and governing of the
entire group. Acting on the part of all employees in the
Sava Group is connected to and directed by the common
values and business principles that form the basis for

a n n u a l r e p o r t | 2 0 0 5
3 6 |
implementing the corporate strategy of Sava d.d. and its
subsidiaries.
Managing subsidiaries is carried out at several levels:
• council of directors of the Sava Group, which consists
of members of Sava d.d. Board of Management,
directors of subsidiaries and the director of
competence centres of knowledge;
• competence centres of knowledge, which exercise the
business policy at expert levels and transfer
knowledge within the Sava Group;
• shareholders’ meetings of subsidiaries, at which Sava
d.d. exercises its voting right and protects its interests;
• supervisory board meetings of subsidiaries, at which
the representatives of the Sava d.d. management
exercise their managing role; and
• occasional consultations, if so required by the nature
of business.
The Council of Directors is headed by the chairman of
Sava d.d. Board of Management. Members meet on a
monthly basis and deal with business achievements and
other important aspects of the company business in the
Group. Furthermore, the Board of Management of Sava
d.d. regularly (twice a year) convenes a business
conference of the Sava Group. The June meeting is
intended for forecasting the business results by the year
end, whereas the December meeting deals with the
business plans for the following year.
Representatives of the Sava d.d. management actively
engage in governing and managing the subsidiaries as
members of their supervisory boards. Their tasks
include regular assessments of the implementation of
company strategic policies and their efficiency, giving
approvals to strategic decisions and appointing or
recalling members of the management bodies, as well as
their remuneration.
There were no changes in 2005 in the management
teams of the subsidiaries.
Managing key strategic
areas through the competence
centres of knowledge
The continual development of operations demands
improvements, which is why we have formed two new
competence centres of knowledge in 2005 such as
Internal Audit and EU Projects.
The competence centres of knowledge are the
organisational form established in order to manage key
strategic areas at the level of the entire Group; they were
formed in 2002 and represent the organisational
successor of the previous network management of
individual areas. One of the Board of Management
members is competent for each of the centres as its
administrator. The fundamental role of the competence
centres that, as a rule, have their management centre in
the holding company, is to take care of performing the
adopted business policy in their particular area of
expertise. The competence centre members in the
subsidiaries exercise common principles within their
companies. The operation of this organisational form of
management and securing knowledge transfer within the
Group is defined in the regulations book of the Board of
Management.
Establishing an internal audit in the form of a
competence centre is substantial progress in
strengthening the corporate governance system,
especially with regard to controlling the business
performance of its subsidiaries. The basic task of
internal auditors in the Sava Group is to provide
assurances, which are based on independent and
impartial audits, about the suitability of procedures for
dealing with risks and to advise on how to improve the
efficiency and success of such procedures in all business
areas.
The tasks of the second newly established competence
centre, EU Projects, is to work systematically and to use
opportunities for funding utilising European structural
funds.
Within the Sava Group there are 14 competence centres
of knowledge: Internal Audit, Risk Management,
Strategic Finance, Finance, Strategic Accounting,
Planning and Analyses, Marketing Systems, HR, Law
and Organisation, Corporate Communications, Strategic
Purchasing, Strategic Informatics, Quality Systems,
Cost Control and Operational Excellence, Safety, and
EU Projects.

COMPETENCE CENTRES OF KNOWLEDGE
3 7 |
Competence centres of knowledge
JANEZ BOHORIČ
STRATEGIC FINANCE
Director: Miha Dolinar
RISK MANAGEMENT
Director: Vlasta Mekiš
FINANCE
Procurator: Iva Žagar, M.A.
MARKETING SYSTEMS
Director: Alojzija Murn
CORPORATE COMMUNICATIONS
Director: Lidija Bregar
HR, LAW AND ORGANISATION
Director: Tatjana Lozar
SAVA d.d.
BOARD OF MANAGEMENT
Chairman: Janez Bohorič
Members: Emil Vizovišek, Vinko Perčič
VINKO PERČIČ
STRATEGIC PURCHASING
Director: Marko Štebe
STRATEGIC ACCOUNTING,
PLAN AND ANALYSES
Director: Mojca Globočnik
STRATEGIC INFORMATICS
Director: Georg Pollak
INTERNAL AUDIT
Director: Duša Haložan Sedej, M.A.
DIVISIONS
Reporting on business
operations and strengthening
the confidence of shareholders
and the public
The basic goal that we pursue in the Sava Group is to
enhance company assets by increasing the efficiency
and profitability of operations. We regularly inform our
shareholders and the general public about our
achievements as stipulated by law and the regulations of
the Ljubljana Stock Exchange as well as the Corporate
Governance Code for Slovenia. We also make use of
numerous other forms and tools of communicating such
as a letter to shareholders, regular announcements and
other written information to interested shareholders and
financial analysts, providing information on the phone
and similar methods.
| i n t r o d u c t i o n |
EMIL VIZOVIŠEK
QUALITY SYSTEMS
Director: Jože Vodičar
COST CONTROLL AND
OPERATIONAL EXCELLENCE
Director: Emil Vizovišek
SAFETY
Manager: Janez Fabjan
EU PROJECTS
Director: Primož Kozina
TRADE INVESTMENT FINANCE
TOURISM REAL ESTATE RUBBER MANUFACTURING OTHER OPERATIONS
Due to intensive business operations and our endeavours
to provide a higher level of business transparency as
well as increased interest shown by shareholders and the
general public in our business recently, the number of
announcements in the electronic information system of
the Ljubljana Stock Exchange, SEOnet, as well as in the
mass media has escalated. The number of
announcements on the website SEOnet stabilised at 47
in 2005, while the number of announcements
concerning the Sava Group in the media increased to
3,394, surpassing the previous year by a good 200.
Regular rankings of Sava d.d. among the best Slovene
companies in assessing annual reports according to the
criteria of Finance magazine proves that the high quality
level of reporting has been maintained. Moreover, we
are ranked in a narrow circle of Slovene companies in
annual reviews on the quality of communication with
investors for the Portal Award organised every year by
the Ljubljana Stock Exchange.
COMPETENCE CENTRES OF KNOWLEDGE

a n n u a l r e p o r t | 2 0 0 5
3 8 |
SAVA d.d.
Growth in the volume of reporting
No. of announcements by
Sava d.d. in the Ljubljana Stock
Exchange electronic information
system, SEOnet
No. of announcements about
the Sava Group in media
The manner, flow of information and responsibilities in
reporting are defined by the Internal Rule Book of
reporting on Sava d.d. as a public joint stock company.
The corporate communication team is in charge of
considering the adopted reporting system, its
reconciliation with new legislation and the introduction
of improvements based on the best domestic and foreign
practices available. The team that operates under the
Board of Management includes the director of the
competence centres and some of their associates.
One of the team’s tasks is to pursue changes in the
Corporate Governance Code for Slovenia, ensure
consistency with it and enforce rules in daily operations
1,448
25
* The electronic system of reporting at the Ljubljana Stock Exchange was introduced in 2002.
1,527
29
1,632
78
3,164
47
3,394
I*
2001 2002 2003 2004 2005
and company business. The commitment to the code
was already adopted by the Statement on Conformity
with the Corporate Governance Code for Slovenia for
the code’s first version that had been designed in March
2004 in collaboration with the Ljubljana Stock
Exchange, Supervisory Board Members Association
and Managers’ Association. In this annual report we
announce the Statement on conformity with the latest
version of the Corporate Governance Code for Slovenia
valid since 14 December 2005 on page 223.
Together with the entire content of the Corporate
Governance Code for Slovenia this statement is available
on our website: http://www.sava.si/1/1d/frame5.htm.

9. Risk Management
3 9 |
| i n t r o d u c t i o n |
The competence centre Risk Management has been operating since the end of 2004. Its members, the
representatives of Sava d.d., systematically incorporate risk management in the organisation and day-to-day
business, business functions and processes in all divisions of the Sava Group. In this way the processes that
prior to then were regulated on the basis of quality management certificates, safety systems and various other
methods for risk management have been upgraded.
Risk management has been defined as a continuous and
developing process that should address risks throughout
the Group’s operations methodically and systematically.
The goal is to achieve a sustained benefit within each
operation, perceive risks and capitalise on them.
On account of the systematic risk treatment in the
Sava Group we have designed competitive
advantages such as:
• more successful conformity to shareholder requirements;
• more efficient allocation of free financial resources;
• less possibility of unforeseeable events; and
• less possibility of insolvency.
Based on the adapted risk management standard from
2002 (Risk Management Standard, issue IRM,
AIRMIC, Alarm from 2002) all risks at the level of the
competence centres of knowledge and individual
business functions that in Group companies are covered
by these centres were documented in 2005. We have
prepared a list of risks of importance for all companies
and classified them into opportunities for benefit and
threats to success. Risks have been classified in a
descriptive manner and their impact on operations
measured as well as the factors determined that mainly
affect risk.
Approximately one half of the recorded risks refers to
internal factors determined by business processes, the
organisation and flow of information as well as
acquiring synergies within the Group. Human resources
management and education has a significant effect on
risk management.
Strategic risks
Strategic risks are dealt with together with the
implementation of the vision, mission and goals of the
Sava Group and its individual companies. Boards of
management in the companies together with their
associates deal with this kind of risk.
Operational risks
Individual competence centres of knowledge deal with
operational risks and manage them through their regular
work procedures. Each centre is responsible for
perceiving and controlling opportunities for benefit and
threats to success from their respective field in
accordance with their competences, strategy, goals and
tasks that have been brought into line at the Group level.
Hazard risks
The appearance of hazard risks is a rare phenomenon,
yet it can have serious consequences, therefore we try to
insure against such risk through insurance companies.
The Sava Group has made special contracts with
insurance companies to cover risks that are adapted to
the Group’s operations. The insurance policy is
amended and adapted to requirements at the annual
level. Insurances are mainly concluded for a term of ten
years. We are endeavouring to level the maturity dates
in the Group and shorten the long-term nature of
insurance policies.

a n n u a l r e p o r t | 2 0 0 5
9.1
4 0 |
Tangible fixed assets are mainly insured against fire,
machinery breakdown, burglary and certain other hazards.
Due to increased investments in preventive action the risk
exposure to insured hazards is becoming lower.
In production and trading companies receivables are
insured as well. Insurance against production standstills,
civil and occupational liabilities and product liabilities
are becoming increasingly important.
Financial risks
The financial policy and thereby financial risk
management in the Sava Group is adopted by the
financial commission of Sava d.d. and confirmed by the
Board of Management of Sava d.d. The financial policy
determines financial relations within the business
system, as well as relations to banks and other partners
in the business system.
The sensitivity of the Sava Group to financial risks is
described in the financial report of the annual report.
Liquidity risks
Owing to its good rating the Sava Group experiences no
difficulties in providing means of solvency. It is
therefore in a position to acquire financial funds in the
banking system relatively easily and under favourable
conditions. The companies of the Sava Group hire loans
practically with all banks operating in Slovenia.
All types of insurance are systematically reviewed
annually in collaboration with the insurance company
and adapted to the operations of the Sava Group with
regard to the changes in the environment where we
operate and experience we have gained with the
insurance company.
The structural relation between long- and short-term
loans of the Sava Group did not change in 2005.
However, the relation between indebtedness in domestic
and foreign currency has changed, the reason being
lower interest rates for loans in foreign currency and a
stable relation between the euro and the Slovene tolar.
The financial function has been very efficiently
managed by cash and balanced liquidity by an active
allocation of cash surpluses and deficits between
companies.
In relation to the banking system, the Sava Group is
exposed as a whole, therefore the centralised
management of cash flows is essential. Due to relatively
low indebtedness of the entire Group we do not have any
problems with liquidity. One of the indicators for the
good Group rating is also the relation between long- and
short-term items in the balance sheet of the Sava Group.

4 1 |
SAVA GROUP
Items in the balance sheet
of the Sava Group
at 31/12/2005
Current liabilities
Current assets
Equity
Other non-current assets
Non-current tied securities
Non-current liabilities
In accordance with the investment policy of the Sava
Group 25 per cent of long-term assets is tied in
securities available for sale. More than 90 per cent of
these shares are listed on the stock exchange, therefore
any deficits in long-term sources does not jeopardise
payment ability.
Credit risk
(27%)
Approximately one half of inflows of the Sava Group is
acquired from customers, which is why insurance of
receivables is of great importance. The risk exposure
with receivables in production and trading companies is
low, since receivables are mainly insured with SID –
Prva Kreditna Zavarovalnica d.d. In the companies in
SAVA GROUP
Cash inflows and outflows
by currency in the Sava Group
in 2005
(1%)
All loans in foreign currency are loans in euros, due to
which the currency risk of indebtedness in 2005 was
| i n t r o d u c t i o n |
(17%) (60%) (62%) (21%) (13%)
the Tourism division we have elaborated a policy for
larger customers – tourist package providers. Due to the
diversification of customers in Tourism the risk
exposure is not very high.
Currency exposure
EQUITY AND LIABILITIES
ASSETS
Foreign currency balance in the entire Sava Group is
considerably adjusted. The allocation of foreign
currency surpluses and deficits is regulated through socalled
internal foreign currency exchanges, thereby
assuring an internal foreign currency balance.
Occasional additional surpluses or deficits are balanced
in collaboration with the banking system.
OUTFLOWS
INFLOWS
(23%) (76%)
considerably reduced with the transition to the euro
region after 1January 2007.

a n n u a l r e p o r t | 2 0 0 5
9.2
4 2 |
Interest rate risk
Since 2004 we have been hiring the majority of new
loans at a variable interest rate (see graph). We consider
variable interest rates as all those based on EURIBOR,
basic interest rate, SITIBOR or others, which individual
banks define as the basis to which they add a margin.
SAVA GROUP
Indebtedness at fixed and
variable interest rate
at 31/12/2005
Fix interest rate
Variable interest rate
Risks related
to issued shares
of Sava d.d.
In addition to systematic and common market and
liquidity risks, which are characteristic for all securities
on the Ljubljana Stock Exchange, there are, to the best
of our knowledge, no additional specific market and
Due to growing risk exposure with euro-nominated risks
and thus exposure due to the EURIBOR-bound interest
rate and its expected growth it was decided in the Sava
Group in 2005 to protect the interest rate at the company
level of the entire Group.
Foreign currency loans Tolar loans
liquidity risks whatsoever that would substantially affect
a change in the value of a share.
According to the report by the Ljubljana Stock
Exchange d.d. from February 2006 the Sava share was
classified in the second of four liquidity groups, which
are defined by the gap between offer and demand,
market depth, share price changeability, trading volume
and the minimum time of presence in the market.

10.Financial
Management
4 3 |
After Sava d.d. had been restructured into a holding company for managing and financing, the role of
financial management has become one of performing essential business functions. The policy is defined at the
level of the parent company, and the co-ordinated presence of Group companies is the domain of the
competence centre Finance.
Sava d.d. does not appear as a direct lessee of required
credit sources. As a rule, the companies themselves hire
loans, which depends on the agreement and planned
indebtedness requirements that are planned annually.
Outside the Group the companies are not able to
contract debts without approval from the Strategic
Finance Department, which agrees upon the terms and
conditions with a selected bank. The balancing of cash
flows, which guarantees financial solvency and using
lines of credit to do so, is agreed upon and co-ordinated
in the same manner.
SAVA GROUP
Hired loans of the Sava Group
by creditor
Credit sources at 31/12/2005
Credit sources at 31/12/2004
160
140
120
100
80
60
40
20
The structure of hired loans and credit sources,
respectively, by creditor type demonstrates that in 2004
the share of bank loans of the Sava Group totalled
around 80 per cent. In 2005 it remained at
approximately the same level. The share of crediting by
the Sava Group was at approximately the same level in
2004 and 2005 – around 20 per cent. A negligible source
of assets is represented by other sources (legal entities).
In 2004 this share amounted to 0.56 per cent, while in
2005 it decreased to 0.22 per cent.
Banks Sava Group
~ 18%
(31/12/2004)
~ 20%
(31/12/2005)
~ 0.56%
(31/12/2004)
~ 0.22%
(31/12/2005)
Other creditors

a n n u a l r e p o r t | 2 0 0 5
4 4 |
SAVA GROUP
Structure of mutual crediting
at 31/12/2005
Credits granted by Sava d.d. to
subsidiaries of the Sava Group
Credits granted by subsidiaries
to the parent company Sava d.d.
The brisk investment activity of Group companies in
2005 dictated a higher long-term indebtedness. This was
utilised to redesign the credit portfolio. The structure of
indebtedness with loans changed in favour of
indebtedness in foreign currency, which at the year end
represented more than 76 per cent of the total figure.
The reason lies in prices, for contracting debts in foreign
currency in Slovenia and abroad was cheaper than in
SAVA GROUP
Currency structure of the
credit portfolio
(in %)
Tolar loans
Foreign currency loans
Due to approaching the European monetary union we
began to redesign the credit portfolio in 2005 so as to
increase the share of euro loans. At the end of 2005
(44%) (56%)
tolars. Another important issue was that Slovenia is
nearing the European monetary union. With this change
a large portion of indebtedness with loans became
bound to the EURIBOR variable interest rate, which
demands serious planning to apply one of the
instruments for insurance against such an interest rate
(IRS).
63.25
36.75
23.60
76.40
31/12/2004 31/12/2005
these loans exceeded three quarters of the total credit
portfolio.

4 5 |
SAVA GROUP
Structure of credit indebtedness
by maturity
(in %)
Short-term loans
Long-term loans
With regard to credit portfolio maturity in 2005, we did
not find any appreciable changes in comparison with the
year 2004.
After a change in the credit portfolio and events in the
domestic monetary market the indebtedness cost was
considerably reduced in 2005 too. At the end of the year
the average interest rate in the Sava Group amounted to
3.53 per cent, which is lower than the interest rate
average in the euro region. A lower inflation rate, keener
competition among banks, high rating, uniform
presence and the favourable negotiating position of the
Sava Group contributed to a reduction in interest rates.
52.63
47.37
| i n t r o d u c t i o n | )
53.46
46.54
31/12/2004 31/12/2005
The off-balance evidence or surety-warranty activity
was maintained at approximately the same level as in
the previous year. Sava d.d. guarantees for hired loans or
guarantees for Group companies (the Trade and Real
Estate division) amount in total to €29 million.
Owing to its rating the parent company Sava d.d., as a
rule, contracts debts without any additional pledge of its
material or financial assets.
We expect that the banking system will continue to treat
the companies of the Sava Group as sought-after
business partners and debtors with preferential
treatment.

a n n u a l r e p o r t | 2 0 0 5
4 6 |
To reach a goal, one has to swim with the flow
and overcome it. We at the Sava Group are
endeavouring to grow further. We have reached
operating revenues of €256.7 million and
generated a net profit of €37.6 million.

Aleœ Aberœek,
swimmer, national champion
in the 200 m butterfly
4 7 |
| b u s i n e s s a n a l y s i s |

a n n u a l r e p o r t | 2 0 0 5
11. The Sava Share and
Ownership Structure
11.1
4 8 |
In 2005 the Sava share fluctuated between €187.8 and €179.5. The unit price on the last day of trading in 2005
reached €180.4, or 1.4 per cent less than in the beginning of the year. The decrease is mainly due to movements
on the Ljubljana Stock Exchange, which also affected the rate of the SBI 20 index that in the same period
decreased by 5.6 per cent. In the last five years long-term investors in the Sava share had a 12.7 per cent
annual yield on average.
Movement of the
Sava share
In the first quarter of 2005 the SAVA share continued its
positive growth trend from the last quarter of 2004. The
share price at 31 March 2005 amounted to €188.1. In the
second quarter of 2005 the Sava share price lowered
slightly, reaching €181.6 on 30 June 2005.
In the second half of 2005 the Sava share price
fluctuated around €179.5, while on the last trading day
in 2005 it amounted to €180.4.
The SAVA share price in the period from 1 January
2005 to 31 December 2005 decreased by 1.4 per cent,
yet its movement deviated upwards by 4.5 per cent on
average and reached lower deviations than the SBI 20
SAVA d.d.
Movement of the Sava share
in 2005
(in SIT)
Sava d.d.
SBI 20
60,000
50,000
40,000
30,000
20,000
10,000
2000
index. In the same period last year the SBI index fell by
5.6 per cent.
By investing in the Sava share long-term, investors have
enhanced their asset value. The investors who invested
€5,066 in the Sava share in the beginning of 2000
increased their asset at the end of 2005 to €10,375. The
return on investment in the amount of 148 per cent since
the beginning of 2000 until the end of 2005 results in an
average yield of 12.7 per cent.
The movement in the price of the Sava share in 2005
was impacted also by a lower trading volume on the
Ljubljana Stock Exchange, which in 2005 decreased by
30.6 per cent or €255.9 million. Despite a decrease in
the SBI index value due to a lower trading volume in the
Slovene securities market, the Sava share price in 2005
2001 2002 2003 2004 2005

4 9 |
SAVA d.d.
Movement of the Sava share
from 2000 to 2005
(in SIT)
Sava d.d.
SBI 20
60,000
50,000
40,000
30,000
20,000
10,000
surpassed the value of the Slovene Stock Exchange
index SBI 20. On average the daily Sava share price
| b u s i n e s s a n a l y s i s |
2000 2001 2002 2003 2004 2005
* Note: To be able to compare the data the SBI 20 index was adapted so as to keep the ratio between the Sava share price and the SBI 20 index during the whole
period at 8.93 as it was on 1 January 2005.
The Sava share is included in
computations of various stock
exchange indices
The Sava share is included in the computation of the
Slovene Stock Exchange index SBI 20 as well as in the
computation of other international stock exchanges
indices.
exceeded the SBI 20* index by 4.8 per cent.
For several years now the Sava share price has
participated significantly in the computation of the
Slovene Stock Exchange index SBI 20. For several
years the Sava share has also been included in the Dow
Jones and other international indices, which include the
largest companies from south-east Europe. This means
that the international business environment has
recognised the company Sava d.d. as a successful
company with stable, long-term development.
Participation of the Sava share in computing the value of important stock exchange
indices as at 31/12/2005
(in %)
Slovene Stock Exchange index – SBI 201-100 10.04
Dow Jones SOX EU Enlarged 15 0.47
Dow Jones SOX EU Enlarged TMI 0.39
Southeast Europe Traded Index 2.28

a n n u a l r e p o r t | 2 0 0 5
11.2
5 0 |
Ownership structure of
the company
On 31 December 2005 17,929 shareholders were
registered in the share register of the company. In the
total structure domestic investors had a 98.2 per cent
stake and foreign investors a 1.8 per cent stake; legal
entities had a 81.4 per cent stake and natural persons an
18.6 per cent stake.
In comparison with the state on 31 December 2004 the
ownership structure of the company Sava d.d. shows
that the share of legal entities rose by 1.3 per cent,
whereas the share of natural persons fell by 1.3
percentage points. Compared to the state at the end of
2004 the share of foreign investors in the company Sava
d.d. rose by 0.1 percentage points.
Ownership by number of shares at 31/12/2005
(v 000 SIT)
No. of % of
Total
No. of Stake in
Ownership by number of shares shareholders shareholders shares capital
1 - 100 17,661 98.5 % 403,699 20.1 %
101 - 1000 229 1.3 % 51,486 2.6 %
1.001 - 10.000 21 0.1 % 74,473 3.7 %
10.001 - 100.000 13 0.1 % 319,590 15.9 %
nad 100.001 5 0.0 % 1,157,739 57.7 %
Total 17,929 100.0 % 2,006,987 100.0 %
Ownership of shares by nationality at 31/12/2005
Ownership of shares by nationality
Domestic shareholders 98.2 %
Foreign shareholders 1.8 %
Total 100.0 %
(in %)

5 1 |
Ownership of shares by category at 31/12/2005
| b u s i n e s s a n a l y s i s |
(v 000 SIT)
% of No. of
Ownership of shares by category ownership shares
State institutions 29.8 % 597,926
Financial institutions and insurance companies 41.7 % 837,592
Legal entities 9.9 % 198,853
Natural persons 18.6 % 372,616
Total 100.0 % 2,006,987
Ownership structure at 31/12/2005 compared to the structure at 31/12/2004
No. of No. of
shares at Stake shares at Stake
Shareholder 31/12/2005 in capital Shareholder 31/12/2004 in capital
Kapitalska Dru¡ba d.d. 375,542 18.71 % Kapitalska Dru¡ba d.d. 375,286 18.70%
Slovene Compensation Fund d.d. 222,029 11.06 % Slovene Compensation Fund d.d. 222,029 11.06%
Legal entities 1,033,511 51.50 % Legal entities 1,008,271 50.24%
NFD1 Investicijski sklad d.d. 291,703 14.53 % NFD1 Investicijski Sklad d.d. 305,581 15.23%
NFD Holding d.d. 161,465 8.05 % Zvon Ena Holding d.d. 119,927 5.98%
Radenska d.d. 107,000 5.33 % Radenska d.d. 107,000 5.33%
Zvon Ena Holding d.d. 68,690 3.42 % Banka Celje d.d. 78,520 3.91%
Etol d.d. 56,305 2.81 % NFD Holding d.d. 72,644 3.62%
Gorenjska Banka d.d. 52,500 2.62 % Etol d.d. 54,805 2.73%
Banka Koper d.d. 46,754 2.33 % Gorenjska Banka d.d. 52,500 2.62%
NFD d.o.o. 39,120 1.95 % Merkur d.d. 41,500 2.07%
Other legal entities 209,974 10.46 % Other legal entities 115,865 5.77%
Sava (treasury shares) 3,289 0.16 % Sava (treasury shares) 3,289 0.16%
Natural persons total 372,616 18.57 % Natural persons total 398,112 19.84%
TOTAL 2,006,987 100.00 % TOTAL 2,006,987 100.00%

a n n u a l r e p o r t | 2 0 0 5
Ownership by category 2001 2002 2003 2004 + 2005 + Average
No. of shares
on 31/12/2005 1,720,987 1,720,987 1,720,987 2,006,987 2,006,987 -
Nominal value of shares
(in thousand €) 74.74 74.74 72.71 84.02 83.77 -
Book value of share
(in €) n/a n/a n/a 190.85 193.76 192.30
Net profit per share (in €) n/a n/a n/a 24.9 19.1 22.0
Dividend per share (in €) 2.30 2.37 2.37 2.59 2.67* 2.46
Share of dividend
in net profit n/a n/a n/a 10.4% 14.0%* 12.2%
Amount of dividends
paid in the year (in million €) 3.93 4.07 4.74 5.18 5.35* 4.66
Earnings per share 6.40% 74.49% -0.52% 59.57% 0.05% 28.00%
- dividend yield 3.20% 2.00% 2.00% 1.41% 1.48% 2.02%
- capital yield 3.20% 72.49% -2.52% 58.16% -1.43% 25.98%
Market capitalisation
(in million €) 123.37 212.16 206.83 368.06 352.86 251.59
Average daily liquidity
(in thousand €) 62.00 106.09 37.74 170.65 21.78 79.65
Average daily trading
with shares 1,650 1,090 344 1,170 208 892
Share price
- highest 78.48 130.29 122.52 183.39 199.47 -
- lowest 64.00 71.66 95.54 115.95 172.29 -
- at year end 71.73 123.60 116.84 183.39 180.38 135.19
P / E
- highest n/a n/a n/a 7.4 9.5 -
- lowest n/a n/a n/a 4.7 9.0 -
- at year end n/a n/a n/a 7.4 9.5 8.4
P / B n/a n/a n/a 96% 93% 95%
5 2 |
Trading with treasury shares
On the last day of 2005 Sava d.d. had 3,289 treasury
shares available whose value, calculated according to
the average purchase price, was €224,500, while the
Key data on the Sava share
• Proposal to the Shareholders’ Meeting
+ Data for 2004 and 2005 is prepared according to IFRSs.
n/a – due to a transition to IFRSs the data from previous years is not comparable.
nominal value reached €137,700. The number of
treasury shares represents 0.16 per cent of the total of
shares issued.
There was no trading with treasury shares between 1
January and 31 December 2005.

5 3 |
Notes:
• The book value of the Sava share is calculated as a
ratio between the equity value of the Sava Group
excluding minority interest and weighed average
number of named shares excluding treasury shares.
• Net profit per Sava share is calculated so as to divide
the net profit for the year that relates to the named
shares of the controlling company (numerator) with
the weighed number of named shares being exercised
in the accounting period (denominator).
• The share of dividends in net profit equals the
fraction product of dividend per share and the number
of shares on the ex-dividend date in the share register
and net profit on the last day of the year.
• The dividend yield equals the fraction of dividend per
Share book value
The book value of the Sava share on the last day of the
year 2005 was €193.8. When calculating the book value
the number of treasury shares was deducted from the
total number of shares.
Dividend per share
The Board of Management of Sava d.d. proposed the
SAVA d.d.
Dividend per share
(In tolars)
| b u s i n e s s a n a l y s i s |
share in the year and market price of the Sava share on
the last trading day of the year.
• The capital yield equals the fraction of the market
price of the Sava share in the beginning and the market
price of the Sava share at the year end.
• Market capitalisation equals the multiple of the
number of Sava shares and the market value of shares
on the last day of the year.
• The P/E index is calculated as the fraction of market
price of the Sava share on the last day of the year (or
the highest and lowest market prices in the calendar
year) and profit per share.
• The P/B index is calculated as a fraction of the price
of the Sava share on the last trading day of the year and
book value of the share in the same period.
payment of a dividend in the amount of €2.67 for a
share, or a total amount €5.3 million.
Taking into consideration the proposed dividend for a
share and the Sava share price on the last trading day of
the year, the dividend yield for 2005 reached 1.5 per
cent. Ever since 1996 Sava d.d. has been increasing the
dividend for a share, thereby guaranteeing its
shareholders stable dividend yields in the long run.
530 546 560
620
640
2001 2002 2003 2004 2005

a n n u a l r e p o r t | 2 0 0 5
5 4 |
Company securities owned by members of the Board
of Management and Supervisory Board
On 31 December 2005 the members of the Board of
Management and Supervisory Board of Sava d.d. owned
Cross-links with other
companies
According to the criteria of the Corporate Governance
Code Sava on 31 December 2005 was cross-linked on
the basis of the following ownership connections:
• Sava d.d. had an 18.5 per cent stake in the company
NFD1 Investicijski Sklad d.d., and NFD had a 14.5 per
cent stake in the company Sava d.d.
2,685 shares in the joint stock company Sava d.d., or a
0.13 per cent stake in total company capital.
No. of No. of
Board of Management shares on Stake shares on Stake Difference
members Position 31/12/2004 in capital 31/12/2005 in capital (5 – 3)
Janez Bohori@ Chairman 706 0.035% 706 0.035% 0
Vinko Per@i@ Member 717 0.036% 717 0.036% 0
Emil Vizoviœek Member 1,140 0.057% 1,140 0.057% 0
Members of Board total 2,563 0.128% 2,563 0.128% 0
No. of No. of
shares on Stake shares on Stake Difference
Supervisory Board members Position 31/12/2004 in capital 31/12/2005 in capital (5 – 3)
Stane Valant, M.A. Chairman 0 0.000% 86 0.000% 0
Miran Kal@i@ Vice Chairman 86 0.004% 706 0.004% 0
Janez Bojc Member 163 0.008% 0 0.000% -0.008%
Janko Kastelic Member 36 0.002% 36 0.002% 0
Toma¡ Kuntari@, M.A. Member 0 0.000% 0 0.000% 0
Goran Bizjak Member 0 0.000% 0 0.000% 0
Jo¡ef Copek Member 0 0.000% 0 0.000% 0
Janez Justin Member 0 0.000% 0 0.000% 0
Miha Resman Member 0 0.000% 0 0.000% 0
Supervisory Board
members total 285 0.014% 122 0.006% -0.008%
Board of Management and
Supervisory Board members total 2,848 0.142% 2,685 0.134% -0.008%
• Sava d.d. had an 11.0 per cent stake in the company
NFD Holding d.d., and NFD Holding an 8.1 per cent
stake in the company Sava d.d.
• Sava d.d. had a 41.1 per cent stake in Gorenjska Banka
d.d., and Gorenjska Banka d.d. a 2.6 per cent stake in
the company Sava d.d.

11.3 Calendar of more significant
announcements
5 5 |
| b u s i n e s s a n a l y s i s |
(Anticipated) date of
Type of announcement or event announcement or event*
Business report and unaudited unconsolidated financial statements Tuesday, 28 February 2006
of the holding company Sava d.d. for 2005
Business report and unaudited consolidated financial statements Friday, 31 March 2006
of the Sava Group for 2005
Summary of the audited annual report of the Sava Group and the Friday, 21 April 2006
holding company Sava d.d. for 2005
Audited annual report of the Sava Group and the holding Friday, 21 April 2006
company Sava d.d. for 2005
Statement on Conformity with the Corporate Governance Code for Slovenia Friday, 21 April 2006
Report by the Supervisory Board Friday, 21 April 2006
Call for the 12 th regular Shareholders’ Meeting of the company Sava d.d. Friday, 28 April 2006
Business report and unaudited financial statements of the Sava Group Monday, 29 May 2006
and the holding company Sava d.d. for the period January-March 2006
12 th regular Shareholders’ Meeting of the holding company Sava d.d. Wednesday, 31 May 2006
Note: only those shareholders who are registered as holders of shares
in KDD two working days after the Shareholders’ Meeting will be entitled
to dividends.
Resolutions of the 12 th regular Supervisory Board Meeting of the holding Wednesday, 31 May 2006 or
company Sava d.d. Thursday, 1 June 2006
Summary of the business report and unaudited financial statements Monday, 25 August 2006
of the Sava Group and the holding company Sava d.d. for the
period January-June 2006
Business report and unaudited financial statements of the Sava Group Monday, 25 August 2006
and the holding company Sava d.d. for the period January-June 2006
Business report and unaudited financial statements of the Sava Group Wednesday,
and the holding company Sava d.d. for the period January-September 2006
* The stated dates are those planned and may be changed during the year.
29 November 2006
Periodical announcements and other price-sensitive information are announced on the website of the Ljubljana Stock
Exchange via the e-system SEOnet (www.ljse.si). Access to information is also provided on the company website
www.sava.si and in cases stipulated by the company statute also in the Official Gazette and the newspaper Finance.
Should the planned announcement dates and events change, this will be notified in due course on the company’s
website.

a n n u a l r e p o r t | 2 0 0 5
11.4 Contact persons:
5 6 |
Investor relations:
Miha Resman, Head of Financial Investments in
Strategic Finance
e-mail: miha.resman@sava.si,
Tel: +386 4 2066 068
Information on dividend payments
Karmen Meœnar, Credit Analyst
e-mail: karmen.meznar@sava.si,
Tel: +386 4 2065 518, 2065 690
Corporate Communications
Lidija Bregar, Director
e-mail: lidija.bregar@sava.si,
Tel: +386 4 2065 819, 2065 903
Further information for shareholders,
the media and the general public is
available on:
the company's website: www.sava.si

12.
5 7 |
Development
Strategy
| b u s i n e s s a n a l y s i s |
We at Sava are intensively implementing the development strategy that was set in 1997 when we expanded our
operations from rubber manufacturing to new branches of business. The period of eight years after the change
in development was divided into two strategic phases. In the first phase that comprised five years (1997-2002)
we strongly accelerated our growth through acquisitions and the establishment of new companies, thus
achieving the position of one of the largest business systems in Slovenia. In the second phase (2003-2007) we
have been focusing on the development of competitive core programmes and services and an increase in
business profitability. The achieved results at the end of 2005 repeatedly confirm that the strategic goals have
been implemented in accordance with planned dynamics and in certain areas even surpassed. In 2006 we are
concentrating on a thorough examination and upgrading of the set strategic priorities, as well as designing
ambitious goals for the next five-year period of our growth and development.
Restructuring operations,
design and growth of the
Sava Group
As the leading car tyre manufacturer in the markets of
the former Yugoslavia and with a 3 per cent share in the
European car tyre market Sava is facing the pressures of
globalisation. Sava did not have available its own
technology for radial tyre production. Confronted with
unfavourable conditions for renewing the contract
offered by the then partner Continental, we decided to
link with the American corporation Goodyear. We sold
a majority stake in the car tyre programmes to Goodyear
and established two companies under joint ownership.
In 1998, Sava d.d., with its operations volume
amounting to scarcely one quarter of the previous
volume, started to implement a new development
strategy that was directed to achieving its primary goal
until 2007: to increase the volume of operations from
the then €38 million to €310 million.
In the period from 1997 to 2002 we surpassed the
volume of operations prior to linking with the Goodyear
corporation by:
• restructuring the industrial rubber programmes that
remained fully owned by Sava d.d.;
.• expanding to related operations (technical trade and
chemicals) that complement rubber manufacturing as
the basic operation;
• diversifying operations (utilising opportunities in the
promising tourism industry and entering the real estate
business, particularly but not exclusively due to a large
volume of investment projects and similar
requirements within the Group); and
• strengthening the investment finance role and
combining strategic investments in real sector and
profitable financial investments.
In 2002, before the expiration of this development
phase, Sava d.d. was restructured to a holding company
for management and finance and formed six key
business areas and divisions of the Sava Group,
respectively.
Enhancing all aspects of
profitability in operations
In the second strategic period, from 2003 to 2007, the
internal growth of the companies and their expansion
continue to be a development priority, thereby shifting
the focus on implementing the development strategy
from operations volume growth to an increase in
operations profitability that until 2007 should reach 10
per cent or three times as much as in 2002.
We have formed separate but complementary missions
and visions of the holding company and the Group.
The mission of the holding company Sava d.d. is to
increase the value of company assets, which is being

a n n u a l r e p o r t | 2 0 0 5
5 8 |
implemented by establishing competences in both key
areas of our operations: managing the majority-owned
companies and managing the investment portfolio.
Managing the companies: subsidiaries are trained to
achieve returns on capital invested that are above
average with regard to the relevant branch.
Managing the companies is based on five strategic
guidelines:
• to ensure the most modern management systems;
• to establish efficient competence centres of knowledge
in all key strategic business areas;
• to provide conditions for employment, development
and motivation of all employees, particularly top
specialists;
• to focus on developing and augmenting the portfolio
of globally competitive products and services in the
long run; and
• to ensure operational excellence and cost efficiency.
Managing the portfolio: we identify, select, acquire
and integrate the right portfolio of businesses that
improve the profitability of investments in the divisions
of the Sava Group.
Managing the portfolio – either acquisitions or
divestitures – is an essential component in managing
such a diverse system like Sava, therefore exacting
criteria that support expertise in this field are being
developed.
The mission of the Sava Group: we are oriented to
continually surpassing the expectations of customers,
employees, shareholders, partners and the environment at
the level of the entire Group, as well as creating attractive
opportunities to employ the best personnel in Slovenia.
The renewed vision of the holding company Sava
seeks to become the most successful and sought-after
capital manager in Slovenia and a respected and
responsible partner in the sustainable development of
the natural and social environment.
The vision of the Sava Group is to offer the greatest
value to the customer and most appealing opportunity
for employing the best personnel in Slovenia.
We have adopted common business principles that in
addition to values represent the basis of our operations.
The common principles that direct the operations of all
Sava Group companies are:
• profitable growth;
• competent and motivated employees;
• excellent knowledge of customers;
• innovative products and services;
• reliability and operational excellence; and
• a fair and ethical business.
The values of the Sava Group direct the organisational
culture of our business system and place great emphasis
on responsibility and the focus on achieving outstanding
results and excellence in conducting business. We are
led by the following values:
• excellence in everything we do;
• reliability and efficiency;
• knowledge, creativity and self-initiative;
• co-operation based on mutual respect and an open
dialogue; and
• responsibility towards the natural and social
environment.
2005 – the primary goal for
2007 surpassed
In recent years Sava has experienced a radical
reorganisation and increased its business success by
restructuring its operations, strengthening its brand
names, making huge investments, increasing the
efficiency of its processes and combined involvement of
its employees.
The plans as set for 2007 have been achieved faster than
originally expected. Already in 2005 the return on
equity surpassed the 10 per cent figure specified in the
strategy, which should be reached only in 2007. The
equity value of the Sava Group rose to €388 million,
and the share book value exceeded the figure of €192
per share. Moreover, in 2005 we invested highly in
further development, especially in the technology and
renewal of our facilities, which will be continued in
2006 and beyond. With new investments the Sava
Group has created and will create new jobs, especially
in Pomurje.
These accomplishments – combined with the achieved
portfolio strength of our operations and companies –
have created a solid foundation for the future and
provided the strength to further exceed our expectations.

5 9 |
Future steps in implementing
the strategy
2006 can be characterised as a year of consolidation for
Sava Group operations, intensive investments and a
further increase in the operating profitability of
subsidiaries. Owing to the already exceeded target
profitability that in line with the set strategy should have
been achieved only in 2007, as well as new development
opportunities and the implementation of planned
changes in the Groups’ composition, this will also be the
year in which strategic goals in all operations and Group
companies are thoroughly reviewed and revised, thereby
determining further detailed steps on the way to
profitable growth of the Sava Group in the next 5-year
development period.
One of the key changes that will make a comparison of
the Sava Group in 2006 and 2005 more difficult will be
restructuring of the Trade division. Till now this has
accounted for more than two thirds of total Group sales
revenues.
Trade in the Sava Group was formed as an operation
that will be strongly strategically linked to Chemicals
operations. The original strategic plans of this operation
anticipated linking the Slovene coatings industry within
the Sava Group. The Chemicals and Trade divisions
would join purchasing and sales channels, resulting in
an increase in the business performance of both
operations. However, neither the merging of the
chemical industry within the Sava Group has been
implemented, nor the planned synergetic effects in the
Trade division. Based on the concentration and difficult
market conditions in this branch, the development and
investment criteria in the Sava Group, and trends
regarding the business and strategic position of both
companies in this division, we have decided to
restructure Trade and thus accelerate its further
development.
In the middle of March 2006 Sava d.d. already
implemented an important part of the strategic
restructuring plan for the Trade division. Due to
collaboration in the increase in share capital and
additional purchases of shares it has already become a
significant 20 per cent owner of shares in the successful
Slovene trading system, the Merkur Group. Future steps
in restructuring Trade include selling the entire
ownership stake that Sava Trade d.d. has in MG Market
d.o.o., and selling the company Sava Trade d.d. to the
| b u s i n e s s a n a l y s i s |
company Merkur d.d. In this way Sava d.d. will
substitute the majority management of a smaller trading
company Sava Trade d.d. with active co-management of
a larger trading system whose prospects for successful
development and profitable business are substantially
better – an accomplishment and opportunity of vital
importance for Sava shareholders.
In this year we plan to adopt strategic decisions
concerning the company Teol d.d. Presently the
programme of this company is being restructured.
Establishing and starting-up the production of green fuel
– biodiesel – on these premises, either independently or
in association with one of the interested strategic
partners, has been identified as one of the promising
courses of development of this operation.
The key generators of our further growth and
development continue to be Rubber Manufacturing,
Tourism, Real Estate and Investment Finance.
In Rubber Manufacturing, our traditional business, it
is planned to double the volume of operations in a
5-year period. This will be achieved by focusing on
innovative, high-quality industrial rubber products and
services and by winning the position of the most
progressive and adaptable niche producer of elastomer
products in Europe and worldwide.
Globally, Tourism is the branch with the highest
growth rates and one of the key branches in the
development of the Slovene economy. The development
vision of Sava’s division Tourism is to strengthen the
role of the leading tourist service provider in Slovenia,
expand its operations to neighbouring markets and
ensure top-class hotel, catering, golf and other tourist
services. Besides the planned comprehensive
investment operations and intensive employment, more
important development tasks in 2006 include more
active collaboration with other tourism companies in
Slovenia and carrying out preparations for the
introduction of the separate management of real estate
and operational business of tourism companies.
In Real Estate we perceive a chance to strengthen our
leading market position in the Slovene market and
further expand operations in the neighbouring Croatian
market where we wish to reach the position of a leading
service provider.

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6 0 |
In 2006 and beyond Investment Finance will
repeatedly contribute a material share to the success of
Sava Group performance. By investing in profitable
financial investments, providing funds for the
development of the Group’s operations, efficient
acquisition of assets and a uniform presence in the
capital market, this division will generate above-average
returns for our shareholders and implement the vision of
becoming the most profitable financial pillar in
Slovenia.
Strategic foundations of future
development
Our financial compass continues to be the return on
capital invested and devoting attention to creating a cash
flow and maintaining a solid asset balance.
The long-term profitable growth of individual
companies and the Group as a whole will be supported
by balanced investment that considers the increase in
added value in the long run, particularly by employing
an innovative approach; this includes both products and
services with potential as well as technology and
processes.
When making decisions regarding investments at the
Group level, we will focus on business areas that
demonstrate the highest success potential.
Continuing modernisation of management systems
and strengthening the efficient operation of
competence centres of knowledge will further remain
in the forefront of our efforts, which up till now has been
proven to be an outstandingly efficient way to manage
key strategic areas, transfer knowledge, and direct and
motivate employees to achieve goals at the level of the
Group and individual companies.
Our employees in particular are of prime importance
for success in all of our operations. Therefore their
qualifications, motivation and corporate disposition, as
well as seeking and developing the best talents, will
remain one of the key strategic development priorities of
the Sava Group in the future. We wish to further
strengthen the volume and quality of various forms of
education including encouraging opportunities for selftraining.
The remuneration system will be linked to the
achievements of an individual and performance of
individual Group companies to an even greater extent.
To win a leading position in Slovenia, be at least
second in the region and rank among three providers
in our own market segment in Europe and
worldwide, respectively, is and remains the basic
requirement and condition for all members of the Sava
Group. We will strengthen the global competitiveness of
our products and services portfolio at the company or
division level by proceeding to identify new market
opportunities, develop new products and services and
design innovative business models that bring
comparative advantages.
Seeking important development opportunities at the
level of the entire Group, particularly in Tourism, is just
one of the activities to ensure operational excellence
and cost efficiency. Another is energy savings, either in
the form of reducing energy consumption or having an
even more efficient supply, which can significantly
contribute to a reduction in costs, thereby increasing the
business performance of Group companies.
The development of Sava will also in the future be
founded on a sustainable basis that we comprehend as
combining long-term economic success with
environmental protection and social responsibility, both
being our contribution towards a better future for
present and future generations.

13.
6 1 |
General Economic
Conditions
Since economic conditions had different effects we
present below the characteristics for each of the
divisions.
Rubber Manufacturing:
• competitiveness grows ever keener, thereby putting
pressure on sale prices;
• saturated in market Western European countries;
• a high price increase in strategic rubber raw materials;
• intensive horizontal and vertical concentration in the
branch;
• relocation of production of technologically less
complex products to Eastern Europe and Asia; and
• stricter environmental standards.
Chemicals:
• further pooling of distribution channels in the Slovene
market;
• entry of new competitors in the target markets; and
• a decline in economic conditions in certain target
markets.
| b u s i n e s s a n a l y s i s |
Economic movements in Slovenia in 2005 were characterised by a growth in domestic product, industrial
production, exports as well as an increase in raw materials prices, which had a particularly negative impact
on the operations of Sava Group companies.
Trade:
• Slovene trade as a whole successfully conducted
business;
• intensive presence of foreign producers and traders;
and
• pooling domestic companies increases price competitiveness.
Tourism:
• a 4 per cent increase in arrivals and 1 per cent more
overnight stays by foreign tourists at the level of
tourism operations in Slovenia;
• a 1 per cent decrease in arrivals and a 2 per cent
decrease in overnight stays by Slovene tourists at the
level of tourism operations in Slovenia;
• change in tourist streams in countries;
• more links within the tourism economy; and
• high dependence on the weather.
Real Estate:
• favourable trends in the building industry;
• increase in construction services; and
• an increase in the share of building houses, decrease in
the share of building other facilities.

a n n u a l r e p o r t | 2 0 0 5
14. Business Operations
of the Sava Group
14.1
6 2 |
The consolidated financial statements of the Sava Group have been compiled according to International
Financial Reporting Standards for the first time. The introduction of International Financial Reporting
Standards has provided a more realistic presentation of the results and assets of the Sava Group. The items in
the financial statements are valued at fair values as required by the new standards. The introduction of new
standards has a positive effect on the presented return on capital employed of the Sava Group, which in 2005
exceeded 10 per cent, as set in the strategy until 2007. The equity of the Sava Group as presented in the balance
sheet increased too and amounted to more than €393 million or €193.8 per a share. Regardless of the applied
standards, the Sava Group operated successfully and all key performance indicators surpassed the planned
values. The Sava Group created a pre-tax profit of €43.8 million, which is 14.5 per cent higher than planned.
In 2005 the companies in the Sava Group generated a net profit of €38.5 million, which was 4.3 per cent more
than set in the business plan.
Business performance of the Sava Group
in 2005
Survey of important data based on the consolidated income statement
of the Sava Group
(€ in millions)
Sava Group Index
in accordance with International Financial Reporting Standards 2004 2005 2005/2004
Net sales revenues 236.1 244.0 103
Other revenues 20.1 12.5 62
TOTAL OPERATING REVENUE 256.3 256.5 100
Earnings before interest, taxes, depreciation and amortisation (EBITDA) 37.7 24.9 66
Earnings before interest and taxes (EBIT) 19.6 8.3 43
Net financing income 16.4 15.8 96
Share in income of associates 16.3 19.6 120
Pre-tax profit 52.2 43.7 84
Tax -3.6 -5.2 145
Net profit of the Sava Group 48.6 38.5 80
- Net profit/operating revenue – in % 19.0% 15.0% 79
Net profit of the Sava Group attributable to Sava d.d. 48.3 38.2 79

6 3 |
Operating revenues
In 2005 the Sava Group generated operating revenues in
the amount of €256.5 million, which was at last year’s
level.
In operating revenues in 2004 negative goodwill
totalling €14.5 million, which referred to the purchase
of companies operating under the Pannonian Spas
brand, was recognised. In operating revenues in 2005
negative goodwill totalling €1.29 million, which was
due to the additional purchase of stakes from minority
stakeholders, was recognised.
SAVA GROUP
| b u s i n e s s a n a l y s i s |
Net sales revenues of the Sava Group in the amount of
€244 million were 4 per cent higher than last year and 3
per cent below plan.
In the sales structure by division Trade had a 38.3 per
cent, Rubber Manufacturing with the Foreign Trade
network a 31.6 per cent, Tourism a 21.5 per cent and
Real Estate a 5.9 per cent share. The remaining 2 per
cent were operating revenues by other operations.
Net sales revenues of the Group in foreign markets
represented 31.1 per cent in consolidated sales revenues.
109.4
211.7
231.3 236.1 244.0
2001 2002 2003 2004 2005
Note: a comparison of net sales revenues from products and services by year corresponds, despite the transition to IFRSs.
SAVA GROUP
Net sales revenues structure
in 2005 by division
OTHER COMPANIES
CHEMICALS
REAL ESTATE
TRADE
RUBBER MANUFACTURING
TOURISM
(31.6%) (38.3%) (5.9%) (2.1%) (0.6%) (21.5%)

a n n u a l r e p o r t | 2 0 0 5
6 4 |
Operating expenses
The Sava Group operated with operating expenses in the
amount of €206.4 million, which was 8.7 per cent more
than in the previous year. In the operating expenses
structure costs of goods, materials and services had a
70.1 per cent, labour costs a 22.3 per cent, depreciation
a 6.1 per cent, and write-offs and other expenses a 1.5
per cent share.
Earnings before interest and taxes
(EBIT)
EBIT in the amount of €8.3 million included the
recognised revenues due to the elimination of negative
goodwill in the amount of €1.29 million, which in the
previous year were much higher and totalled €14.5
million.
EBIT, without considering the revenues originating
from the elimination of negative goodwill totalling €7.0
million, was 38.2 per cent higher than last year. The
growth in sales, strict supervision over the cost increase
and optimum use of operating assets resulted in an
improvement of the operating performance of the
Group, which for the second year in a row was reflected
in enhanced EBIT.
Net financing income
In 2005 the Sava Group created financing income in the
amount of € 24.4 million, or 16.2 per cent less than last
year. In the financing income structure the profit in sale
of financial investments had a 77.7 per cent share and
received dividends an 8 per cent, received interest a 5.6
per cent and other financing income an 8.7 per cent
share. Financing income was mainly generated by the
company Sava d.d. and is described in the part of the
annual report that refers to Sava d.d.
In 2005 the Sava Group created financing expenses in
the amount of €8.6 million, or 32.3 per cent less than in
the previous year. In the expense structure the major
part, or 70.7 per cent, had expenses for interest for hired
loans, 18.8 per cent were due to impairments in financial
investments, and the remaining 10.5 per cent were other
financing expenses.
The achieved financing income totalling €15.8 million
was 3.8 per cent lower than last year and was generated
by Sava d.d. in total.
Share in income of associates
Revenues from share in income of associates referred to
Gorenjska Banka d.d., Kranj and were created in the
amount of €19.6 million, which was 20.5 per cent more
than last year. €5.7 million or 29 per cent was paid as
dividends, the remaining sum of €13.9 million or 79.5
per cent being the rest of the attributable profit of
Gorenjska Banka d.d. for 2005 considering the equity
method.
(€ in millions)
2005 2004
Operating income without elimination of negative goodwill 7.0 5.1
Income 15.8 16.4
Elimination of negative goodwill 1.3 14.5
Share in income of associates 19.6 16.2
PRE-TAX PROFIT 43.7 52.2

6 5 |
Pre-tax profit
The pre-tax profit of the Sava Group totalling €43.7
million was 14.5 per cent higher than planned or 20.9
per cent lower than last year’s profit. The pre-tax profit
included:
Tax
For 2005 tax liability in the amount of €3.3 million and
an ascertained receivable from recently found temporary
differences totalling €0.25 million were computed. In
the income statement an income tax of €5.2 million was
presented, which was 45.5 per cent higher than last year.
The effective tax rate for 2005 amounted to 12.0 per
cent and was 5.1 percentage points higher than last year.
The changed tax legislation already affected the tax
liability amount in 2005. A decrease in possible relief in
connection with investments, which in the Sava Group
are high, will cause an even higher tax liability in the
future.
Net profit for the year
Net profit of the Sava Group for 2005 was generated in
the amount of €38.5 million and was 4.3 per cent above
plan. In comparison with last year it was 20.9 per cent
lower, the reason being the negative goodwill due to the
purchase of companies operating under the Pannonian
Spas brand, which in 2004 was shown under revenues.
| b u s i n e s s a n a l y s i s |
Irrespective of this event, the Sava Group in 2005
generated a net profit that was 8.8 per cent higher than
last year.
In 2005 all divisions operated with a positive result with
the exception of the Chemicals division, which is being
strategically reorganised, and other operations including
companies and projects that have just begun.
Return on capital
Return on capital of the Sava Group, calculated as the
ratio between pre-tax profit and average balance of
equity, amounted to 11.9 per cent and was 5.2
percentage points lower than last year.
Return on capital of the Sava Group calculated as the
ratio between net profit and average balance of equity
amounted to 10.5 per cent and was 5.5 percentage points
lower than last year. The achieved return on capital was
0.5 percentage points above the planned return in 2005.
Both the lower profit in absolute terms and lower return
on capital of the Sava Group were mainly due to a single
financial income in 2004 in the form of eliminating the
negative goodwill that was realised with the purchase of
companies operating under the Pannonian Spas brand.
Contribution to return on capital by income type in 2005 and 2004
(EUR in millions)
2005 2004
Operating income 1.9% 1.7%
Income without elimination of negative goodwill 4.3% 5.4%
Elimination of negative goodwill 0.4% 4.8%
Share in income of associates 5.3% 5.3%
Tax -1.4% -1.2%
NET PROFIT FOR THE YEAR 10.5% 16.0%

a n n u a l r e p o r t | 2 0 0 5
14.2
6 6 |
Assets, equity and
liabilities of the Sava
Group at 31/12/2005
The balance sheet sum of the Sava Group at 31/12/2005
amounted to €651 million and was 9.7 per cent higher
than in the same period last year. Important changes
appeared in tangible fixed assets, especially in Tourism.
Investments in associates, mainly in Gorenjska Banka
d.d., increased by 13.2 per cent due to the application of
the equity method.
SAVA GROUP
31/12/2005 / 2004
240
257
04/05
Equity and liabilities
In the liabilities structure equity had a 60.3 per cent
share, which was 3.4 percentage points less than last
year. Non-current liabilities had a 12.9 per cent share in
the liabilities structure, which was 16.5 per cent more
than last year and current liabilities a 26.8 per cent
share, which was 21.4 per cent more than last year.
107
121
Assets
In the assets structure of the Sava Group tangible fixed
assets, intangible fixed assets and investment property
represented 41.7 per cent, investments in associates 18.6
per cent, non-current securities available for sale 21.4
per cent and current assets and other assets 18.3 per
cent.
In the assets structure by division Sava d.d. has a 59.2
per cent share, Tourism a 21.5 and Other Operations an
19.3 per cent share.
134
140
13
26
44
44
48
50
7
13
594
651
04/05 04/05 04/05 04/05 04/05 04/05 04/05
In total liabilities the hired non-current and current loans
in the amount of €188.3 million were the greatest item,
exceeding last year’s figure by 29.5 per cent. In the
liabilities structure they had a 28.9 per cent share. A
higher indebtedness rate was due to large investments in
Sava Group companies.

6 7 |
SAVA GROUP
Equity and liabilities at
31/12/2005 / 2004
(€ in millions)
Equity
Non-current liabilities
Curent liabilities
Total equity and liabilities
Investments
In 2005 the companies of the Sava Group earmarked €
37.6 million or 1.4 per cent more than last year for
investments. A good half of all investments was
implemented in Tourism for the modernisation of
existing and construction of new hotel facilities. An
additional one third of investments in Sava d.d. was
mainly earmarked for construction of buildings for the
market.
SAVA GROUP
Investments in fixed assets in
the Sava Group
(€ in millions)
| b u s i n e s s a n a l y s i s |
378
393
72
84
143
174
594
651
04/05 04/05 04/05 04/05
Data about the share book value on the
basis of the equity value of the Sava
Group at 31/12/2005
The share book value of Sava d.d. calculated as the ratio
between the equity value of the Sava Group without
minority interest and weighed average number of
ordinary shares without treasury shares at 31/12/2005
amounted to €193.8, which was one per cent more than
last year.
The market value of the Sava share at 31/12/2005
amounted to €180.4 and reached 93.1 per cent of the
book value.
14.3
23.1
14.4
37.0
37.6
2001 2002 2003 2004 2005

a n n u a l r e p o r t | 2 0 0 5
15. Business Operations by Division*
15.1
6 8 |
Rubber Manufacturing division
with the Foreign Trade Network
V i s i o n
To focus on innovative quality industrial rubber
products and services and double business volume
in a 5-year period as well as win the position
of the most advanced and niche market-adaptable
manufacturer of elastomer products
in Europe and throughout the world.

6 9 |
| b u s i n e s s a n a l y s i s |
* Key data was prepared in accordance with
International Financial Reporting Standards

a n n u a l r e p o r t | 2 0 0 5
7 0 |
The companies of Rubber Manufacturing achieved sales in the amount of € 95.1 million, which was 14per cent
higher than last year. In the total consolidated sale of the Sava Group Rubber Manufacturing with the Foreign
Trade Network had a 31.6 per cent share. Total pre-tax profit was 42 per cent higher than last year, and net
profit totalling €1.4million was 38 per cent higher than generated in the same period last year. Rubber
Manufacturing earmarked € 4.6 million for investments.
For 2006 it is planned to achieve sales revenues of € 98.5 million with a pre-tax profit of € 2.9 million, while
€ 4.5 million will be invested in an additional upgrade of production facilities.
Key data for Rubber Manufacturing with the Foreign Trade Network
2004 2005
(€ in millions)
Index
2005/2004
Net sales revenues 83.2 95.1 114
Pre-tax profit 1.2 1.7 142
Net profit 1.0 1.4 138
Assets 39.0 47.0 120
Equity 20.2 21.3 105
Liabilities 18.8 25.7 136
Investments in fixed assets 2.5 4.6 180

7 1 |
The company Savatech d.o.o., the largest in the Rubber
Manufacturing division, increased its net sales revenues
by 16 per cent with regard to last year. 74 per cent of
products were sold in foreign markets, the most
important partner being Germany. Despite unfavourable
trends, Savatech d.o.o. operated very successfully in the
raw materials market and contributed 70 per cent to the
total profit of Rubber Manufacturing.
The company Sava-GTI d.o.o. is a smaller, but rapidly
developing company that re-oriented to the car market
with a range of high quality and high value-added
products. Net sales revenues were 32 per cent higher
than last year, the profit generated being twice as high as
last year. Sava-GTI d.o.o. contributed 23 per cent to the
total profit of Rubber Manufacturing.
The company Sava-Schäfer d.o.o. is a joint venture
with the German strategic partner Schäfer AG.
Therefore the key data for Rubber Manufacturing show
| b u s i n e s s a n a l y s i s |
only one half of the sales revenues, profit, assets and
liabilities of this company. In 2005 the company
generated sales revenues that were 15 per cent higher
and profit that was 45 per cent higher than last year.
The company Sava Rol d.o.o. from Zagreb confronted
tough business conditions in Croatia in 2005 too, with
keen competition in particular. In the structure of the
Rubber Manufacturing division the company does not
represent a significant share.
Foreign Trade Network
The Foreign Trade Network mainly sells products from
the Rubber Manufacturing programmes; 22 per cent of
products are sold through its network. It includes five
companies in Germany, UK, USA, Czech Republic and
Poland and two representative offices, these being in
Moscow and Trieste.

a n n u a l r e p o r t | 2 0 0 5
15.2
7 2 |
Trade division
V i s i o n
To make use of benefits that result
from operational restructuring in 2006,
which includes the sale of the entire ownership
stake in the company Sava Trade d.d. and
MG Market d.o.o. and entering Sava d.d.
in the company Merkur d.d. with
a significant shareholding.

7 3 |
| b u s i n e s s a n a l y s i s |

a n n u a l r e p o r t | 2 0 0 5
7 4 |
The Trade division created net sales revenues in the amount of € 97.8 million, which was at last year’s level.
In the total consolidated sales structure of the Sava Group Trade had a 38.3 per cent share. Total pre-tax
profit amounting to €3 million was 70 per cent higher than last year, as well as net profit of €2.2 million. Trade
earmarked €0.4million for investments.
For 2006 it is planned to strategically restructure the Trade division, which includes, on the one hand, selling
the entire stake in the companies Sava Trade d.d. and MG Market d.o.o. and, on the other, entering Sava d.d.
in the company Merkur d.d. with a significant ownership stake. That is why the business plan for the Sava
Group for 2006 has been prepared by taking into account the mentioned changes.
Key data for Trade
(€ in millions)
Index
2004 2005 2005/2004
Net sales revenues 97.5 97.8 100
Pre-tax profit 1.7 3.0 170
Net profit 1.4 2.2 154
Assets 63.1 61.1 97
Equity 24.7 26.9 109
Liabilities 38.4 34.2 89
Investments in fixed assets 0.4 0.4 119

7 5 |
In 2005 the company Sava Trade d.d. created net sales
revenues in the amount of €54 million, which was 4 per
cent less than last year. The generated profit totalling
€2.2 million was 33 per cent above last year’s figure and
mainly produced by selling real estate.
Incorporating the company in the Merkur Group with a
similar sales programme will facilitate an improvement
in the strategic market position, an increase in the
common market share and exploiting synergistic
benefits due to both economy of scale and pooling and
utilising the best knowledge and business models that
companies with a long-standing tradition have available.
| b u s i n e s s a n a l y s i s |
The company MG Market d.o.o. did not substantially
improve its business performance. Net sales revenues
totalling €43.8 million were in fact 6 per cent higher
than last year. However, this was not sufficient for a
positive result. Too great dependence on the franchise
partner, long-term rental contracts for OBI centres and
keen competition by new centres with similar sales
programmes were the reason for a loss totalling €0.03
million, which, however, is much lower than last year.
The strategic restructuring plan of the Trade division
includes selling a stake in the company MG Market
d.o.o. too.

a n n u a l r e p o r t | 2 0 0 5
15.3
7 6 |
Tourism division
V i s i o n
To strengthen its position as the leading
tourist service provider in Slovenia,
expand its operations to neighbouring
markets and provide an integrated range
of top-class hotel,catering,golf and
other tourist services.

7 7 |
| b u s i n e s s a n a l y s i s |

a n n u a l r e p o r t | 2 0 0 5
7 8 |
With regard to the conditions where factors such as especially large investments and disturbingly unfavourable
weather were prominent, the companies of the Tourism division successfully concluded the year 2005.
The generated net sales revenues in the amount of €54.4 million were 3 per cent higher than last year. In the total
consolidated sales structure of the Sava Group Tourism had a 21.5 per cent share. Pre-tax profit totalling €0.6 million
and net profit totalling €0.5 million were lower than last year. The deviation was partly due to the implementation
of planned investments and partly to a revaluation of buildings in the company Terme Radenci d.o.o.
For investments in fixed assets Tourism earmarked €20.5 million, or almost 54.4 per cent of all investments in
the Group. Important investments in Pannonian Spas were the construction of a new 5* hotel in Terme 3000,
renovation of the hotel Radin in Radenci, renovation of the hotel Zeleni Gaj in Banovci and the refurbishment
of an outdoor swimming pool with an amphitheatre in Ptuj. In Sava Hotels&Resorts Bled the renovation of
Park Hotel commenced and the information system was completely renewed.
In 2006 Tourism plans to generate sales revenues of €58.2 million, total pre-tax profit of €4.4 million and invest
€20.0 million.
Key data for Tourism
(€ in millions)
Index
2004 2005 2005/2004
Net sales revenues 52.9 54.4 103
Pre-tax profit 2.92 0.62 21
Net profit 2.87 0.45 16
Assets 169.8 181.3 107
Equity 106.6 106.3 100
Liabilities 63.1 75.0 119
Investments in fixed assets 24.8 20.5 82

7 9 |
Sava Hotels&Resorts Bled
The company Golf in Kamp Bled d.d. made net sales
revenues of €2.9 million, or 6 per cent more than last
year, and created a net profit of €0.13 million, which
was significant progress in comparison with last year.
The company continued to win new markets and
provide quality services oriented to meeting top-class
standards as set for the tourism industry in Europe. In
order to implement this goal, it has drafted
documentation for the renovation of King’s golf course,
and a project to extend it with another nine holes is
underway.
The company Grand Hotel Toplice d.o.o. generated
sales revenues of €6.0 million, or 4 per cent more than
last year, and concluded the year with a loss of €0.2
million.
All business goals of the company were not
implemented in full, since tourist movements for the
company, which offers top-quality hotel services in the
region, were unfavourable. The already implemented
restructuring programme and projects in progress will
improve future results.
| b u s i n e s s a n a l y s i s |
The company G&P Hoteli Bled d.o.o. created net sales
revenues of €10.1 million, or 10 per cent more than last
year. It generated a net profit of €0.8 million, or 11 per
cent more than in the same period last year.
Good business results are due to the renovation of hotel
capacity, introduction of new products and acquisition
of congress facilities. Brisk investment operations will
continue in 2006, assuring further business growth.
Pannonian Spas
The company Terme 3000 d.d. created net sales
revenues of €15.6 million, which is one per cent less
than last year and generated a net profit of €1.2 million,
or 19 per cent less than in the same period last year.
The planned disruptions in operations due to extensive
investment and, consequently, a decrease in overnight
stays slightly deteriorated company business in
comparison with last year. For 2006 a significant
increase in all business indicators is planned.
The company Terme Radenci d.o.o. created net sales
revenues of €12.5 million, or 3 per cent less than last
year and operated with a loss of €2.2 million, the reason
being a revaluation of buildings.

a n n u a l r e p o r t | 2 0 0 5
8 0 |
The renovation of Hotel Miral and a restrictive policy
led by the Healthcare Insurance Service caused a deficit
in sales in the healthcare area. Projects are under way
that will have a positive effect due to energy-efficient
buildings. Additional investments will be required in the
tourist infrastructure that will only meet the
requirements of high-category guests.
The company Terme Ptuj d.o.o. created net sales
revenues of €4.0 million, or 9 per cent more than last
year. The generated net profit totalling €0.28 million
was 6 per cent above last year’s figure.
The first part of the investment programme, during
which water facilities were arranged, was completed.
The accommodation facility will be improved through
building a 4* hotel and new apartments in 2007.
SAVA GROUP
Comparison of overnight stays by
domestic and foreign guests
in the Tourism division
No. of overnight stays
of guests from abroad
No. of overnight stays
of domestic guests
The company Terme Lendava d.d. created net sales
revenues of € 3.3 million, or 13 per cent more than last
year, and generated a net profit of € 0.41 million, which
was almost four times more than last year.
Investments in the renovation of hotel and swimming
pool facilities, larger capacity and the introduction of
new products facilitated an improvement in quality,
therefore the price achieved for providing services
exceeded last year’s price.
Overnight stays structure in the
Tourism division
Tourism made 1,062,270 overnight stays, or 3 per cent
less than last year. In Sava Hotels&Resorts there were
311,856 overnight stays, or 10 per cent less than last
year, while Pannonian Spas reached 750,414 overnight
stays, or 3 per cent less than last year.
(61%)
(39%)

8 1 |
SAVA GROUP
Comparison of overnight stays by
domestic and foreign guests
in Sava Hotels&Resorts Bled
No. of overnight stays
of guests from abroad
No. of overnight stays
of domestic guests
SAVA GROUP
Comparison of overnight stays by
domestic and foreign guests
in Pannonian Spas
No. of overnight stays
of guests from abroad
No. of overnight stays
of domestic guests
| b u s i n e s s a n a l y s i s |
(5%)
(47%)
(95%)
(53%)

a n n u a l r e p o r t | 2 0 0 5
15.4
8 2 |
Real Estate division
V i s i o n
To act as a key co-ordinator of real estate business
within the Sava Group,strengthen its leading
position in the Slovene market and further
expand its business in the neighbouring
Croatian market with the aim of being
ranked among the leading
real estate managers.

8 3 |
| b u s i n e s s a n a l y s i s |

a n n u a l r e p o r t | 2 0 0 5
8 4 |
The Real Estate division achieved net sales revenues of €14.8 million, or 8 per cent less than last year. The
revenues in this division depend entirely on the stage of completion of construction projects, therefore
deviations in years are common. In the consolidated sales structure of the Sava Group Real Estate had a 5.9
per cent share. Pre-tax profit totalled €1.04million and was 6 per cent above last year’s profit, while net profit
in the amount of €0.73 million was 12 per cent lower than last year.
For 2006 Real Estate plans to create revenues of €15.9 million and a pre-tax profit of €1.1 million.
Key data for Real Estate
(€ in millions)
Index
2004 2005 2005/2004
Net sales revenues 15.9 14.8 93
Pre-tax profit 0.98 1.04 106
Net profit 0.82 0.73 88
Assets 45.7 50.9 111
Equity 10.3 11.1 107
Liabilities 35.4 39.8 112
Investments in fixed assets 0.83 0.66 80

8 5 |
The company Sava IP d.o.o. is the supporting company
in the division and accounted for 81 per cent of total
sales. In 2005 the company created net sales revenues in
the amount of €12.0 million, which was 12 per cent less
than last year. It also generated a net profit of €0.6
million, or 16 per cent less than last year.
In 2005 the company Sava IP d.o.o. concentrated its
business in Ljubljana and on the Slovene coast. Due to
the expansion to the Croatian market it collaborated
with companies already established by Sava IP d.o.o. or
Sava d.d., or acted as a strategic partner in companies
such as IP Nova d.o.o., IP Nova A d.o.o., Sava IPN
d.o.o. and Sava Nova d.o.o. Zagreb. The companies PC
| b u s i n e s s a n a l y s i s |
AG d.o.o. from Velenje and Sava IMG d.o.o. Poreå are
joint ventures with a strategic partner. The mentioned
companies are not significant in the common indicators
for 2005, yet their business will strengthen in the
following year.
The company Sava Medical in Storitve d.o.o. has the
status of a disability company and in 2005 generated net
sales revenues of €2.2 million, which is at last year’s
level. Its net profit totalling €0.05 million was lower
than last year.
In 2006 the company will be dealt with under Other
Operations.

a n n u a l r e p o r t | 2 0 0 5
15.5
8 6 |
Investment Finance division
V i s i o n
To generate an above-average return
for shareholders by investing in profitable
financial investments and ensuring funds for the
development of the Group’s divisions,efficient
acquisition of funds and a uniform presence
in the capital market,thus making us the most
profitable financial pillar in Slovenia.

8 7 |
| b u s i n e s s a n a l y s i s |

a n n u a l r e p o r t | 2 0 0 5
8 8 |
The Investment Finance division is represented by the company Sava d.d. The data in the continuation was
prepared in accordance with International Financial Reporting Standards, whereas the business analysis and
the financial statements of Sava d.d. were prepared in accordance with Slovene Accounting Standards. There
are significant differences mainly in assessing non-current securities available for sale that are consistent with
IFRS, according to which the asset and equity value of the company Sava d.d. is increased.
Key data for Investment Finance
(€ in millions)
Index
2004 2005 2005/2004
Net sales revenues 7.7 8.0 103
Pre-tax profit 17.0 22.5 133
Net profit 14.0 18.8 134
Assets 442.8 498.8 113
Equity 348.2 366.5 105
Liabilities 94.6 132.3 140
Investments in fixed assets 8.4 11.5 136

8 9 |
| b u s i n e s s a n a l y s i s |
In 2005 too Investment Finance continued to successfully manage financial investments and thus substantially
contribute to the income of both Sava d.d. and the Sava Group.
Investing in profitable financial investments ensures the potential for further development of other operations
in the Sava Group and brings our shareholders suitable yields and long-term security for the invested assets.
Sava d.d. earmarked over € 37.6 million for investments in long- and short-term financial investments. The
majority of financial investments was implemented in the domestic market, while in line with the stated
development strategy for tourism we increased the ownership stake in the Croatian tourist holding.
In the domestic capital market we increased our stakes in the companies NFD1, Delniæki Investicijski Sklad,
d.d., NFD Holding d.d., Laæko d.d. Brewery, Mercator d.d. and KD Group d.d. In the foreign capital market
we increased our stake in the tourist holding Dom Holding d.d. and acquired a stake in Slavonski Investicijski
Sklad d.d.
A major part of funds for investment in long- and short-term domestic investments was acquired through
divesting certain existing financial investments. The rest of the funds was acquired from other financing sources.
SAVA d.d.
Survey of financial investments
by maturity at the end of 2005
Short-term financial investments
Long-term financial investments
(36%)
(64%)

a n n u a l r e p o r t | 2 0 0 5
9 0 |
SAVA d.d.
Geographical survey of financial
investments at the end of 2005
Foreign financial investments
Domestic financial investments
Domestic financial investments
in 2005
To assure suitable yields and long-term security for the
invested assets of our shareholders we increased
investments in 2005 in the companies NFD 1, Delniæki
(6%)
(94%)
Investicijski Sklad d.d., NFD Holding, Laæko d.d.
Brewery, Mercator d.d. and KD Group d.d.
(v 000 SIT)
No. of
Investments shares % stake
NFD 1 d. d. 8,000,000 4.98%
NFD Holding d. d. 1,450,000 4.80%
Brewery Laœko d. d. 250,983 2.87%
Mercator d. d. 25,026 0.78%
KD Group d. d. 7,972 4.28%

9 1 |
Foreign financial investments in
2005
In line with the development strategy of further
investing outside of Slovenia we continued with
investment operations in Croatia. In 2005 we increased
the ownership stake in one of the largest Croatian tourist
Decrease in financial
investments in 2005
Consistent with the adopted strategic policy we sold
certain long and short-term investments in domestic and
| b u s i n e s s a n a l y s i s |
holding companies Dom Holding d.d., in which Sava
d.d. owned more than 16 per cent of the company at the
end of 2005. In 2005 we also acquired a 4.27 per cent
share in Slavonski Investicijski Sklad d.d.
(v 000 SIT)
No. of
Investments shares % stake
Dom Holding, d. d. 122,000 1.50%
Slavonski Zaprti Investicijski Sklad, d.d. 143,000 4.27%
foreign companies.
(v 000 SIT)
No. of
Investments shares % stake
Geoplin, d. o. o. business stake 5.94%
SN Holding, d. d. 196,603 5.85%

a n n u a l r e p o r t | 2 0 0 5
15.6
9 2 |
Chemicals division
The company Teol d.d. created sales revenues of € 5.4million, or 13 per cent less than last year. In this year
too it made a loss of € 0.27 million.
In line with the business plan 2006 Teol d.d. will create sales revenues in the amount of €6.2 million, whereas
a loss in the amount of € 0.2 million will still be made. Seeking new sales channels, which poses a major
problem for the company, did not bring results, therefore in 2006 a decision will be made to restructure it
according to one of several possible scenarios.
The Chemicals division in the Sava Group will be discontinued in 2006, while the operation of the company
Teol d.d. will be transferred to Other Operations.
Key data for Chemicals
(€ in millions)
Index
2004 2005 2005/2004
Net sales revenues 6.2 5.4 87
Pre-tax profit -0.81 -0.26 32
Net profit -0.81 -0.27 33
Assets 4.0 2.7 66
Equity 1.4 1.1 80
Liabilities 2.7 1.6 59
Investments in fixed assets 0.09 0.04 41

15.7
9 3 |
Other Companies
| b u s i n e s s a n a l y s i s |
Other Companies represent Gea Sol Int. d.o.o., Biool d.o.o. and Energetika Sava d.o.o. As for their details,
these companies represent development projects in the Sava Group. However, the volume of their operations
in 2005 was not large.
The 2006 business plan does not envisage any significant changes for Other Operations with regard to 2005,
and the business result will still be negative. In 2007 the company Energetika Sava d.d. will implement its first
development plans.
Key data for Other Companies
(€ in millions)
Index
2004 2005 2005/2004
Net sales revenues 0.02 0.23 1,376
Pre-tax profit -0.19 -0.63 330
Net profit -0.19 -0.63 326
Assets 0.36 0.28 77
Equity 0.23 -0.28 -
Liabilities 0.13 0.56 419
Investments in fixed assets 0 0 -

a n n u a l r e p o r t | 2 0 0 5
9 4 |
The results have been accomplished by intensive
management of the operations of the Sava Group.
Our outlook for 2006 is ambitious.
We will restructure the Trade division and
consolidate our position in Rubber Manufacturing,
Tourism, Investment Finance and Real Estate.

Valter Bon@a,
cyclist, Tour de Slovénie winner
9 5 |
| b u s i n e s s a n a l y s i s |

a n n u a l r e p o r t | 2 0 0 5
16.
16.1
9 6 |
Business Operations of Sava d.d.
The holding company Sava d.d. is the parent company of the Sava Group. Last year its business was successful
and the results surpassed those planned. It created net sales revenues of €8.0 million, which was 5 per cent
better than in the previous year. Financial income in the amount of €28.0 million is at last year’s level, while
the planned pre-tax profit is exceeded by 40 per cent. Last year pre-tax profit totalled €21.5 million. The net
profit of Sava d.d. in the amount of €17.9 million considerably surpasses that planned too; it is 39 per cent
higher than last year and 26 per cent above plan, respectively.
Business performance
(€ in millions)
Index
2001* 2002 2003 2004 2005 2005/2004
Net sales revenues 53.2 13.2 11.9 7.6 8.0 105
Other revenues 7.7 0.2 0.6 0.5 1.7 373
Operating expenses -65.9 -20.0 -17.5 -11.9 -9.8 83
FINANCING INCOME 11.0 14.1 13.3 19.5 21.8 112
TOTAL PRE-TAX PROFIT 7.9 7.5 8.3 15.8 21.7 137
NET PROFIT 7.3 7.0 7.0 12.9 17.9 139
* In 2002 Sava d.d. restructured into a holding company.
Net sales revenues
Since restructuring into a holding company the net sales
revenues of Sava d.d. mainly represent sales within the
Sava Group, while in the total Group structure they have
arounda3percentshareofcumulative sales.
In 2005 the joint stock company Sava created net sales
revenues of €8.0 million, or 5 per cent more than last
year. In the net sales revenues structure office rentals
had a 45 per cent share and equipment rentals a 19 per
cent share. The remaining 36 per cent was mainly due to
the contribution of subsidiaries for using the trademark
and sales of services by the competence centres of
knowledge.
Other revenues in the amount of €1.7 million were three
times higher than last year, 78 per cent of this sum being
due to revenues from selling real estate.

9 7 |
Operating expenses
Operating expenses totalled €9.8 million, or 17 per cent
less than in the same period last year.
In the expenses structure cost of goods, materials and
services had a 35 per cent share, labour costs a 34 per
cent, write-offs a 30 per cent share and other costs one
per cent share.
A significant part of operating expenses was due to
managing financial investments, therefore a surplus in
the financial results was partly earmarked to cover these
expenses.
Financing income
In 2005 the joint stock company Sava created financial
revenues in the amount of €28.1 million, which is at last
year’s level, and financial expenses totalling €6.2
million, or 28 per cent less than last year. The surplus in
| b u s i n e s s a n a l y s i s |
The financial statements of Sava d.d.
were prepared in accordance with
Slovene Accounting Standards.
Financing income by activity type - € in millions
financial revenues over financial expenses totalling
€21.8 million exceeds last year’s figure by 12 per cent.
The predominant 73 per cent share of dividend totalling
€7.7 million represents dividends obtained from
Gorenjska Banka d.d. Kranj, which compared to last
year were more than twice as high. Furthermore,
dividends in other companies where Sava d.d. had
financial investments are considerably higher than last
year and will present a significant source of company
profit in the future too.
66 per cent of financial revenues from the sale of securities
totalling €18.8 million were realised by selling a stake in
Geoplin d.o.o., 17 per cent by selling securities in certain
Croatian fonds and 17 per cent by selling other portfolio
investments. Financial expenses in connection with
securities totalling €2.0 million were mainly due to
impairment in the value of securities with regard to the
Stock Exchange price on the day of the accounting period.
(v mio SIT)
Financial Financial Financial Financial Financial Financial
revenues expenses income revenues expenses income
Year 2005 Year 2004
Dividends 7.7 0 7.7 2.8 0 2.8
Securities 18.8 2.0 16.8 9.6 4.6 5.0
Sale of a 20% stake
in Sava Tires JVH d.o.o. 0 0 0 14.0 0 14.0
Interests 1.0 3.2 -2.2 0.9 3.0 -2.0
Associates 0 0.9 -0.9 0 0.7 -0.7
Others 0.4 0.1 0.4 0.8 0.3 0.5
TOTAL 28.1 6.2 21.8 28.1 8.6 19.5

a n n u a l r e p o r t | 2 0 0 5
9 8 |
Interest revenues relate to loans granted to subsidiaries.
Interest expenses were due to the indebtedness of the
company with banks, which was higher than last year on
account of large investments in the entire Sava Group.
Financial expenses in connection with subsidiaries
totalling €0.9 million included losses in these
companies in the amount of €0.59 million and
revaluation adjustments of granted loans to these
companies in the amount of €0.33 million.
Other financial revenues totalling €0.4 million were
mainly due to the charged guarantees, while other
financial expenses in the amount of €0.06 million were
due to the negative exchange rate differences and other
financial expenses.
Total pre-tax profit
In 2005 the total pre-tax profit of Sava d.d. amounted to
€21.7 million, which was 37 per cent higher than last
year and 40 per cent higher than planned.
SAVA d.d.
Net profit by year
(€ in millions)
Accumulated profit and
dividend
Accumulated profit of the joint stock company Sava on
31/12/2005 totalled €29.8 million. The Board of
Tax on profit
Based on the generated total profit and considering the
provisions on the Law on Income of Legal Entities the
tax liability of Sava d.d. for 2005 totalled €3.80 million;
taking into account deferred taxes the figure was €3.78
million. In comparison with last year the tax liability
was 28 per cent higher and also exceeded that planned,
primarily on account of a delay in certain investments
and related tax relief.
Net profit
The generated net profit of Sava d.d. in the amount of
€17.9 million was 39 per cent higher than last year and
26 per cent higher than planned.
7.3 7.0 7.0
12.9
17.9
2001 2002 2003 2004 2005
Management of Sava d.d. will propose to the
Shareholders’ Meeting a payment of dividends for 2005
in the amount of €2.67 per share. € 5.4 million will be
allocated to the payment of dividends.

9 9 |
Return on capital
Return on capital of Sava d.d. calculated as the ratio
between the total profit of the accounting period before
tax and the balance of equity for 2005 amounts to 7.9
per cent, or 1.3 percentage points more than last year.
The return on capital of Sava d.d. calculated as the ratio
between the net profit for the financial year and the
balance of equity, for 2005 amounts to 6.5 per cent or
1.2 percentage points more than last year.
Balance sheet total
The balance sheet total of Sava d.d. amounts to € 440.8
million and is 21 per cent higher compared to last year.
| b u s i n e s s a n a l y s i s |
Accumulated profit at 31/12/2005
(€ in millions)
Net profit for the year 2005 17.9
Retained profit from previous years 20.8
Allocation of the 2005 profit to revenue reserves -8.9
Accumulated profit at 31/12/2005* 29.8
*50% of the net profit for 2005 was allocated to other revenue reserves.
SAVA d.d.
Assets structure at 31/12/2005 / 2004
(€ in millions)
Tangible fixed assets
Long-term financial investments
Short-term financial investments
Other assets
Total assets
Assets structure
In the assets structure long-term financial investments
has the largest share, i.e. 51 per cent, while short-term
financial investments has a 31 per cent share and
tangible fixed assets a 17 per cent share.
Long-term financial investments total €224.6 million.
There are no significant changes when compared to last
year. The shares in the subsidiaries of the Sava Group
and the shares in the associates (Gorenjska Banka, d.d.),
were increased due to employing the equity method,
which involves adding the attributable profit in
investment and an increase in specific equity revaluation
adjustment.
Short-term financial investments in the amount of
€136.7 million is 57 per cent higher than last year, this
being due to an increase in the ownership stakes in
Mercator d.d., NFD 1 Investment Fund, NFD Holding,
Laæko Brewery, KD Group and certain Croatian funds.
69
76
202
225
87
137
6
4
363
441
04/05 04/05 04/05 04/05 04/05

a n n u a l r e p o r t | 2 0 0 5
1 0 0 |
Liabilities structure
The capital of the joint stock company Sava in the
amount of €318.3 million is 12 per cent higher than last
year. In the liabilities structure it has a 72 per cent share.
The significant changes in capital are as follows:
• in 2005 a net profit of €17.9 million was realised, half
of it being allocated to other revenues reserves;
• €5.2 million was allocated for a dividend payment;
• the specific equity revaluation adjustment was
enhanced by €22 million: due to profit sharing in the
associate Gorenjska Banka, d.d. in the amount of
€19.6 million and in subsidiaries in the amount of
SAVA d.d.
Liabilities structure at
31/12/2005 / 2004
(€ in millions)
Equity
Long-term liabilities
Short-term liabilities
Other liabilities
Total liabilities
Investments in fixed assets
In 2005 Sava d.d. invested €11.5 million in tangible
fixed assets, mainly for the purchase of strategic land
and real estate and partly for finishing the EKO
building, in which the production of environmental
protection and rescue products is already under way.
€5.2 million, while a decrease in specific equity
revaluation adjustment in the amount of €2.9 million
represents paid dividends of Gorenjska Banka, d.d. in
2005.
Financial and operating liabilities totalling €122.2
million has a 28 per cent share in the liabilities structure
and compared to last year the figure is higher by 54 per
cent. The increase in indebtedness of the joint stock
company Sava with banks is mainly due to intensive
investment activity in the entire Sava Group.
283
318
7
8
73
114
0
0
363
441
04/05 04/05 04/05 04/05 04/05
Financial position of the
company
The joint stock company Sava is highly liquid and
solvent and shows a favourable capital structure. We
estimate that in doing business with the joint stock
company Sava there are no risks related to solvency, and
the company has sufficient capital available as regards
the volume and type of business it performs.

17.
1 0 1 |
Outlook for 2006
| b u s i n e s s a n a l y s i s |
In 2006 too the Sava Group will proceed with activities in accordance with the set strategy. Important changes
will occur in the composition of the Group's operations. We have set demanding goals in relation to efficient
marketing, quality products and services and rationalising business processes. We will act so as to achieve and
surpass our planned goals.
2006 will be a year of great change in the operations of
the Sava Group. The restructuring plan of the Trade
division includes, on the one hand, selling the entire
ownership stake in the company Sava Trade d.d. and the
company MG Market d.o.o. and, on the other, entering
the company Merkur d.d. with a significant ownership
stake. The mentioned changes will considerably affect
the data and indicators relating to Sava Group operations
in 2006. We anticipate that sales revenues in the Sava
Group will decrease by 36 per cent and operating income
by 8 per cent, while operating profitability in subsidiaries
will increase due to selling the Trade division.
The plan for the Sava Group has been produced in
accordance with International Financial Reporting
Standards, as have the results for 2005. In the
comparisons presented below the same structure of the
Sava Group applies.
In 2006 the Sava Group will create consolidated net sales
revenues in the amount of €155 million, which is 4 per
cent more than net sales revenues in 2005. In the
structure of net sales revenues the Rubber Manufacturing
division with the foreign trade network is represented
with 48 per cent and has thus become the leading
division as far as volume is concerned; the Tourism
division has a 34 per cent share, Real Estate 9 per cent,
and other operations 9 per cent too. In this way the target
policy of Sava d.d. in the intensive management of three
divisions has been successfully rounded up.
An important part of the created profit of the Sava
Group has been contributed by the financial holding
company Sava d.d. which for 2006 plans to generate
financial revenues that are lower than in 2005 due to the
planned decrease in the sale of portfolio investments.
That is why for both the holding company Sava d.d. and
the Sava Group lower profit figures are planned for
2006. However, in accordance with the mid-term plan
the profit in the following years will increase by at least
6 per cent annually.
In 2006 the Sava Group plans to create a pre-tax profit
in the amount of €32.6 million and net profit of €29.2
million, which means a 7.5 per cent return on capital.
The planned profit of the Sava Group consists of the
profit in subsidiaries, profit in associates and profit in
the financial holding; each of them contributes one
third.
€38 million will be earmarked for investments that are
mainly intended for the completion of renovation and
construction of new hotel facilities in Tourism, increase
in and modernisation of manufacturing capacity in
Rubber Manufacturing, and building real estate for sale.

a n n u a l r e p o r t | 2 0 0 5
18. Marketing
18.1 Managing brand names
1 0 2 |
We at the Sava Group are endeavouring to develop our own brand names, therefore we are continually
improving the communication strategy to promote our recognition. By successfully managing brand names,
we enhance the sale of products and services of the Group, strengthen a positive image in the public eye and
augment company assets.
The strategy as set for the Tourism division governed
the design of the brand names of two tourist destinations
that link the services of various companies in Bled and
the Pannonian region. For Bled we have designed the
Sava Hotels&Resorts Bled brand and in the north-east
of Slovenia the Pannonian Spas brand. Both brands are
protected and registered in foreign markets too.
In September the Trade division presented its new
communication strategy for the OBI brand and its
advantages. The focus is on the concept: OBI is more.
The concept meets the high standards that OBI has set
and includes the integrated effect of various
communication tools – from media communications to
the exterior appearance of OBI stores.
We promote brand name recognition on the website too.
We redesigned the home page www.hotelibled.com. Its
main purpose is to inform visitors and sell services
offered by Sava Hotels Bled. By launching a new
booking system, we made room reservations more userfriendly;
in 2006 the system will be upgraded through a
bonus card.
A new home page www.panonske-terme.si has been
created which, in addition to a comprehensive range of
Pannonian Spas, provides up-to-date offers in individual
destinations and links between them.

18.2
1 0 3 |
Customer policy
Sava’s focus on customers means having good
knowledge of their business, comprehending and
anticipating their requirements and, above all, their main
questions, being familiar with their experience and
adapting products and services to support their
performance.
In order to rank customers more easily, the Group has
defined criteria for rating customers. We have also
defined what position and competitive power individual
companies have with their customers. In the balanced
indicators system we pursue them on the basis of
various financial and non-financial measurements that
have been harmonised with the strategic goals of
individual Group companies.
The companies of the Sava Group systematically rank
their customers according to their strategic importance.
Vital for long-term success and stable business are key
customers with whom we have established partnership
relations and mutual business on a long-term basis. The
systematically gathered information about customers
and their position in the marketplace is accessible to
everyone in the company who deals with customer
communication. In this way the companies are able to
forecast their own success with that achieved by their
key customers.
| b u s i n e s s a n a l y s i s |
The long-term success of the Sava Group is a result of focusing on customers; this forms the basis for designing
the strategic goals and strategies for all the companies in the Group. The opportunities and risks associated
with customers are managed in an efficient manner and supported by systematic data gathering on a longterm
basis.
We continually measure customer satisfaction and
consider their proposals to improve their position in the
marketplace as well as ours.
Regular customer satisfaction surveys are carried out in
all divisions: on the one hand, they are adapted to the
characteristics of individual companies, on the other,
they assure relative comparability also within a
particular company or division.
Satisfaction is also measured with all key customers.
From their point of view we also estimate the most
important satisfaction factors, general satisfaction and
how ready customers are to make recommendations to
others. We are open to all of their suggestions. The
result measurements – also at the level of an individual
customer – form the guidelines we include in the
continual improvements system.
In order to compare selected competitors we have
chosen particular areas in individual divisions to be able
to successfully manage competitive strength. The results
obtained refer further to the introduction of
improvements.

a n n u a l r e p o r t | 2 0 0 5
19.
1 0 4 |
Strategic Purchasing
and Suppliers
For the fifth year in succession the central management, joint purchasing policy, goals and strategies, through
efficient decentralised performance based on common purchase agreements and contracts, have resulted in
decreased purchase prices for several groups of goods, the exception being raw materials and energy. In this
way costs were significantly reduced, thereby strengthening the profitability of the companies in the Sava
Group.
In 2005 a joint and co-ordinated presence in the
purchasing market and consequent performance of
purchasing strategies considerably reduced the
unfavourable effects of oil price growth and the demand
for industrial raw materials from Asian markets.
Agreements with strategic suppliers have contributed to
further strengthening partnership relations and reducing
exposure to prevailing stock exchange fluctuations. On
account of joint operations of the competence centre
Strategic Purchasing we have additionally improved the
SAVA GROUP
Fluctuations in materials and goods
prices in the Sava Group
(annual deviations in %)
Sava Group
ECB, Statistics Pocket Book:
Industrial products prices
10
8
6
4
2
0
-2
planned business performance of the companies in the
Sava Group. We managed to moderate the anticipated
growth in purchasing prices and reduce it by 3.6
percentage points. Spreading common purchase
contracts to the fields of energy sources, logistical
services, standard equipment and services as well as raw
materials along with utilising synergies and a joint
presence in the purchase market have resulted in further
savings for the Sava Group in the amount of more than
one half million euros.
7.7
3.6
1.3
1.9
-0.1
0.0
-0.9 -1.0
2002 2003 2004 2005

1 0 5 |
Raw materials and goods represent nearly a 60 per cent
share in the total purchase value of the Sava Group.
Most of the quantity was purchased in foreign markets
for the Rubber Manufacturing, Chemicals and Trade
divisions. In comparison with the price growth of
European industrial products we have improved the
conditions for purchasing in the last three years by more
than 5 percentage points.
The Tourism division purchases primarily in the
Slovene market. A share of raw materials and goods
represents about 20 per cent of the purchase value in the
entire Tourism division. In the last three years the prices
that we had achieved lagged behind the prices of
consumer goods by more than 17 percentage points.
In 2005 the price increases of raw materials and energy
in the world market surpassed all expectations.
Nevertheless, thanks to solid partnerships with key
SAVA GROUP
Fluctuations in materials and goods
prices in Tourism
(annual deviations in %)
Tourism
ECB, Statistics Pocket Book:
Consumer goods prices
10
5
0
-5
-10
-15
| b u s i n e s s a n a l y s i s |
suppliers we have moderated risks that result from rising
prices also on account of our greater demand and
intensive mutual co-operation.
In Rubber Manufacturing, long-term contracts with
suppliers, especially with important global suppliers, are
of vital importance for the stability and success of
business. One of our important partners in the supply of
raw materials is the Goodyear corporation. Long-term
contracts with this concern bring additional positive
business effects, strengthen our purchasing power and
reduce costs in stock exchange markets. The price
competitiveness of rubber products has a favourable
impact on the increase in deliveries from low-priced
workforce markets.
Strategic purchasing will continue to perform its
planned activities in 2006 too. We expect the greatest
opportunities to attain our goals in the Tourism division.
-0.1
0.0
2.0
-0.9
4.1
6.2
-7.5
2002 2003 2004
-11.1
2005

a n n u a l r e p o r t | 2 0 0 5
20.
1 0 6 |
Development Activities
20.1 Development of business processes
Special emphasis is given to cost efficiency, adaptability, responsiveness and an innovative approach in all
business processes.
The concept of total quality includes excellence in
controlling and adapting all factors that affect growth in
business achievements. In the business excellence
model (EQA) we therefore perform self-assessment and
external assessments to determine shortcomings in
factors and company results. Shortcomings or
deviations from the planned results are addressed as
challenges for introducing a systematic change.
We are continually reviewing improvements in the
process efficiency and conformity of accomplishments
with the long-term strategy of the Sava Group and
individual companies by applying the system of key
business indicators and the balance scorecard method
(BSC).
The performance indicators system for business
processes assures a systematic improvement of
individual processes and the system as a whole. In this
way we provide a better link between the development
policy, business policy and process efficiency, as well as
improved system transparency. Last year we focused in
particular on rationalising business and optimising
business processes.
Special attention is devoted to the incorporation of all
associates in process improvements; they are organised
in teams with set goals and measurable goals to support
improvements in companies and throughout the
business group.
We are aware that the transfer of knowledge and
experience among associates plays an important role in
the balanced and more rapid progress of the entire
group. Therefore we established 14 competence centres
that cover the Sava Group’s individual areas of
business. These centres include the most competent
associates from all companies, their purpose being total
quality management and the improvement of processes.
The continual improvement of processes in the Sava
Group has been underway for the fourth year in a row
and results in annual savings of € 4.2 million.
In order to continually improve business performance
we are also encouraging an innovative attitude of
employees and promoting the culture of careful
management, controlling and efficient cost decrease.

20.2 Quality of business
1 0 7 |
On account of stronger international competition and an
increase in pressure on expenses, new forms of
organisation (just-in-time), higher expectations related
to services and products, and especially due to more
stringent manufacturer liability for products we apply
numerous quality assurance tools such as:
• quality standards SIST EN ISO 9001, or processes
related to the car industry VDA 6.1 and more recently
ISO/TS 16949;
• standards covering the safe production of foodstuffs
HACCP (DS 3027 or ISO 22000);
• requirements for regulating processes with regard to
the EQA model (business excellence) or the 20 Keys
method; and
• numerous statistical methods, recently employing the
6 Sigma method.
The mentioned approaches have in the past been
systematically and successfully introduced at the Group
level. The accomplishments are evident from an
increase in sales of our products and services, and in the
successfully performed audits and indicators achieved,
with which we directly pursue achievements at the
quality level.
In Rubber Manufacturing we introduced the numerical
determination of process stability in 2005.
| b u s i n e s s a n a l y s i s |
One part of the Sava Group’s business involves endeavouring to have better quality of business programmes
and processes. Requirements for highly efficient quality management systems encourage us to use numerous
management tools and systematically improve processes. Continual improvements in all processes enable us
to increase the competitive edge of our products and services, as has been proven by the numerous certificates
obtained.
The quality of products in 2005 reached 99 per cent,
despite a great number of new products in the Velo,
Profile and EKO programmes. Owing to the share of
new products and frequent change of raw materials in
product formulations as a consequence of price
movements for raw materials in the market, the amount
of total waste has increased slightly.
The integrated management system in Trade or the
company Sava Trade d.d. meets the requirements of the
international standards SIST EN ISO 9001, ISO 14001
and OHSAS 18001 and includes the systems of quality
management, efficient handling with the environment
and assuring health and safety at work. In Sava
Trade d.d. we strive to link all management tools into a
uniform, efficient management system that will include
the quality management system, environment
management systems and the occupational health and
safety system. In 2005 the Introducing Continual
Improvements System project, which was financed by
the Ministry of the Economy of the Republic of
Slovenia, was completed. As part of the project the 20
Keys method is being introduced, which provides an
integral, organised system for finding internal resources,
better utilisation of own resources, and increasing
competitiveness, performance, added value per
employee and employee motivation. We carried out a
breakdown of processes in retail sales and a method of

a n n u a l r e p o r t | 2 0 0 5
1 0 8 |
momentary observations. We have invested
considerable time and knowledge in the additional
training of work team leaders in retail sales.
Within the integrated management system the company
Sava Trade d.d. in 2005 carried out:
• internal and external audits of the management system;
• completion of training for quality system managers;
• analysis of processes in logistics and retail sales and
introduced measures based on results; and
• applications in the Environment-Friendly Company
campaign.
In the company Teol d.d., which operates as part of the
Chemicals division, we reduced inventories in products
and raw materials, thereby saving €48,000. We also
made savings in the release of raw materials (number of
analyses, rating suppliers, auditing), while the goals set
for the claims area have not been achieved in full. We
experienced difficulties especially due to the
discontinuation of etoxilate production and seeking
other suppliers in the market. However, the surveillance
audit of the process with regard to the requirements set
by the SIST EN ISO 9001 standard for renewing the
certificate was successful.
In Tourism we mainly focused on transferring best
practices among individual companies. In addition to
the quality team we included professional teams in
Tourism, which consist of specialists from individual
companies that provide tourist catering in all Sava
Group companies. We are preparing the standards for
companies that operate under the Sava Hotels & Resort
brand to produce a recognisable Sava tourism service in
various tourist segments.
In May we successfully passed the certification audit of
companies operating under the Pannonian Spa brand.
Terme 3000 d.d., Moravske Toplice, Terme Lendava
d.d. and Terme Ptuj d.o.o. have available a successfully
introduced quality management system that conforms to
the standard SIST EN ISO 9001. Terme Radenci d.o.o.
and the companies of G&P Hoteli Bled d.o.o., Grand
Hotel Toplice d.o.o. and Golf in Kamp Bled d.d. passed
a follow-up audit in accordance with this standard and
proved that the quality management system was being
improved and upgraded. The kitchen of Grand Hotel
Toplice passed the regular audit of the HACCP system
for assuring the production of safe foodstuffs in
accordance with DS3027. The audit also included the
requirements as defined by the ISO 22000 standard.
Three companies from the Tourism division participated
in the campaign organised by the Republic of Slovenia
for business excellence for 2005. In May an application
with a self-assessment report was submitted by the
companies Terme Radenci d.o.o., Grand Hotel Toplice
d.o.o. and G&P Hoteli Bled d.o.o. Terme Radenci d.o.o.
received a silver diploma in this campaign.
The company Sava IP d.o.o., which belongs to the Real
Estate division, passed with outstanding results the
surveillance audit on the conformity of the quality
management system with the SIST EN ISO 9001
standard, thus proving the continual improvement and
upgrading of the introduced system.

20.3 Development of information support
1 0 9 |
Information technology in the Sava Group is understood
as a strategic function that accompanies the
development of a business system. We are aware of the
fact that providing suitable information support
contributes to the implementation of set goals. The
efficient performance of informatics at Sava is therefore
understood as a tool for creating added value and the
simultaneous management of risks that occur.
In the future we will upgrade the present system through
the introduction of tested models for management
(COBIT, ITIL). The suitable management of
informatics and coordination of its development with
the business strategy of the company are the
prerequisites for information technology to be able to
contribute to the return on assets invested and gain an
advantage over our competitors.
The central focus in the area of information technology
was on providing efficient information support for the
decision-making process at all management levels in the
Sava Group, as well as secure operation of the
| b u s i n e s s a n a l y s i s |
The strategic information platform of integral information support in the Sava Group was established by the
successful introduction of an integrated computer programme SAP R/3 in Rubber Manufacturing and
Tourism in Bled. Last year we began to introduce the SAP system and the ROS hotel catering system in the
group of hotels operating under the Pannonian Spa brand.
information system itself. In all companies of the Sava
Group the Manager Information System (MIS) was
introduced, which facilitates the pursuit of the most
important business indicators and enables comparisons
with the planned values and results from previous years.
MIS was additionally upgraded with the function of
enabling the monitoring of profitability of individual
products and customers.
An important milestone in the introduction of
informatics was that of a treasury SAP module at the
Group level to manage assets in a more efficient way.
We have successfully completed the project of renewing
informatics in the companies operating under the Sava
Hotels&Resorts Bled brand and establishing a
functional link between the hotel catering system ROS
and SAP modules for finance and controlling.
In the safety area we outlined the basis and measures for
providing safety of information system operation in the
Sava Group and standardised the virus protection
system throughout the Group. We will further centralise
the management of our information system.

a n n u a l r e p o r t | 2 0 0 5
1 1 0 |
It would be difficult to succeed without
co-operation with the local and broader community.
In return we sponsor various projects and make
donations to the social community.
In 2005 we earmarked funds that exceeded
last year’s figure by one fifth.

Iztok #op and Luka Œpik,
oarsmen, world record holders,
world and Olympic champions
1 1 1 |
| s u s t a i n a b l e d e v e l o p m e n t r e p o r t |

a n n u a l r e p o r t | 2 0 0 5
21.
1 1 2 |
Sustainable Development
Reporting on the environmental and social component of sustainable development is a constituent
part of Sava's Annual Report. The Sustainable Development Report includes a survey of key matters,
activities and a report on implemented goals.
Our commitment to business success is combined with safety and social responsibility. We therefore
act in a responsible and ethical manner. This is the key to the implementation of our vision: to become
a successful and sought-after manager of capital in Slovenia and a responsible partner in the
sustainable development of the natural and social environment.
Our basic guidelines are:
• care for the satisfaction and safety of employees and the creation of a stimulating working environment;
• prudent management of energy by incorporating environment-friendly technologies;
• care for the natural environment;
• quality of business in line with our policy; and
• integration in the social environment as its support, which is the key to our success.

22.
22.1
1 1 3 |
| s u s t a i n a b l e d e v e l o p m e n t r e p o r t |
Important Events and
Accomplishments in the
Area of Social Responsibility
Employees in the Sava Group
• Number of employees
increased from 3,014 in 2004 to 3,062.
SAVA GROUP
The structure of employees
by division
SAVA d.d.
CHEMICALS
REAL ESTATE
TRADE
RUBBER MANUFACTURING
TOURISM
• The average salary increased by 4.1 per cent.
(30%)
(19%) (3%) (2%) (2%) (44%)
(v 000 SIT)
2004 2005
Average salary (€) 983.9 1,026.5
• Education
The average number of hours per employee reached 70.5 and the average cost of education amounted to € 147.2.
(v 000 SIT)
2004 2005
Average no. of education hours per employee 71 70.5
Average cost of education per employee (€) 145.4 147.1

a n n u a l r e p o r t | 2 0 0 5
1 1 4 |
• Owing to a flexible work organisation and a larger
number of internal education courses we saved about
€0.32 million. Additional savings were created on
account of obtaining funds from European projects.
• Employee healthcare:
28 per cent of employees received preliminary, periodic
and specific health examinations in 2005.
22.2 Sponsorships for and
donations to the social
community
In 2005 the Sava Group allocated €4,734,000 for
sponsorships and donations, or 20 per cent more than in
2004.
• Sport:
We further strengthened the long-standing partnerships
with Sava Cycling club and Triglav Skiing club.
• Culture:
With the Museum of Gorenjsko we concluded a fouryear
general sponsorship agreement on the birth-place
home of the great Slovene poet Dr. France Preæeren in
Vrba.
• Safety at work:
One of the novelties was collaborating in the Stop the
Noise campaign.
• Number of work-related injuries decreased by 0.3
per cent.
• Training courses for safe work were attended by 57
per cent of employees.
• Professional development:
In 2005 we sponsored the final conference of the
international interdisciplinary research project
Manufacturing Visions – Quo Vadis?
• Charity:
The fee proceeds and a contribution by the company
Golf in Kamp Bled d.d. were donated to the
development centre of the kindergarten in Bled for preschool
children with special needs.
• Integration in the social community:
We actively engaged in numerous international,
national, professional and voluntary associations. We
are also a co-founder of the Development Forum of
Gorenjsko.

22.3
1 1 5 |
Environmental
indicators in the
Sava Group
| s u s t a i n a b l e d e v e l o p m e n t r e p o r t |
• Significant achievements in decreasing the
• consumption of energy resources
In Tourism we decreased the consumption of natural
gas, electricity, propane-butane gas and heating oil to a
great extent.
• Drinking and river water consumption
On the Labore premises in Kranj we decreased drinking
water consumption by 11.6 and specific river water
consumption by 21 per cent.
• Dust particle emissions were almost completely
eliminated so that the quantities (0.01-0.12 mg/m 3 ) are
considerably below the permissible limit (50 mg/m 3 ).
• All waste is safely and professionally disposed of.
• Decreasing the use of hazardous substances
– Owing to the discontinuation of etoxilate production
in the company Teol d.d. ethylene-oxide is no longer
used.
– The specific use of nitrite- and nitrate-based LCM
salts was decreased.
• Noise
Owing to the introduction of technical measurements we
reduced noise so that night and day levels do not exceed
the permissible limits.
• Fire safety
Numerous drills demonstrated the high level of
readiness of the intervention team and employees.

a n n u a l r e p o r t | 2 0 0 5
23.
1 1 6 |
The Development of Employees
We wish to provide a safe working environment for our employees that encourages continual learning,
co-operation and creativity. We motivate employees with awards and by making them aware that each
individual is an important part of the team. We have established a long-term system of training for all
employees that we named Akademija Sava. We are aware that the readiness of our employees for lifelong
learning, personal development, entrepreneurial spirit and adapting to changes are decisive for making
progress and preserving a competitive edge in all of our operations.
23.1 Concern for employees
Creating a working environment in which employees
are able to realise their potential and ambitions in
accordance with Sava corporate values are one of our
priority goals.
The average number and
structure of employees
In 2005 the average number of employees in the Sava
Group increased from 3,014 in 2004 to 3,062 in 2005.
There were no greater changes in the Group’s
composition, therefore the employee structure in
individual divisions remains similar to the year before.
Tourism has the largest share of employees with 44 per
cent, and is followed by Rubber Manufacturing with 30
and Trade with 19 per cent.
368 associates were newly employed in the companies
of the Sava Group, of whom 301 were employed for a
fixed period of time and 52 got a permanent position.
Due to the seasonal nature of work most employees
(166) were newly employed in Tourism. Tourism is
followed by Rubber Manufacturing where the
companies Savatech d.o.o. and Sava GTI d.o.o.
employed 126 new associates on account of an increase
in production capacity and sales.
Last year 324 associates left the companies of the Sava
Group, which did not significantly exceed the figure
from the previous year. The fluctuation is greatest in
Tourism with 54.6 per cent, mainly due to terminating
contracts concluded for a fixed period of time.
27.5 per cent of the a.m. fluctuation is due to an agreed
termination of contract, 12.6 per cent to retirement, 23.5
per cent termination according to the law, and 36.4 per
cent due to resigning for business reasons.
In 2005 the total fluctuation in the Sava Group
amounted to 10.5 per cent, or only 0.2 per cent more
than in the year before. The seasonal character of
tourism business demands high employment flexibility,
and with regard to the number of employees that
Tourism has in the Sava Group, the percentage of the
total fluctuation is relatively low and reveals the high
level of employee loyalty and satisfaction.

1 1 7 |
Number of employees
| s u s t a i n a b l e d e v e l o p m e n t r e p o r t |
(v 000 SIT)
Average
No. of No. of Index no. of
employees employees 2/1 employees
01/01/2005 (1) 31/12/2005 (2) 2005 Jan-Dec 2005
Sava d.d., Kranj 47 53 113 49
RUBBER MANUFACTURING 860 941 109 904
Savatech d.o.o., Kranj 685 754 110 718
Sava-GTI d.o.o., Kranj 73 84 115 83
Sava-Schäfer d.o.o., Kranj 42 43 102 43
Sava ROL d.o.o., Zagreb 10 10 100 10
Foreign trade network 50 50 100 50
CHEMICALS 78 61 78 69
Teol d.d., Ljubljana 78 61 78 69
TRADE 597 573 96 585
Sava Trade d.d., Ljubljana 337 311 92 325
MG Market d.o.o., Ljubljana 260 262 101 260
TOURISM 1,341 1,328 99 1,362
Grand Hotel Toplice Bled d.o.o., Bled 148 149 101 154
Golf in Kamp Bled d.d., Bled 50 51 102 54
G&P Hoteli Bled d.o.o., Bled 223 217 97 233
Terme 3000 d.d., Moravske Toplice 375 374 100 374
Terme Lendava d.d., Lendava 122 124 102 119
Terme Ptuj d.o.o., Ptuj 75 78 104 80
Terme Radenci d.o.o., Radenci 348 335 96 348
REAL ESTATE 92 88 96 90
Sava Medical in Storitve d.o.o., Kranj 73 69 95 71
Sava IP d.o.o., Ljubljana 19 19 100 19
OTHER COMPANIES 0 3 3
Energetika Sava d.o.o., Kranj 0 3 3
TOTAL SAVA GROUP 3,015 3,047 101 3,062

a n n u a l r e p o r t | 2 0 0 5
1 1 8 |
Educational structure
of employees
The educational structure of employees did not
substantially change. However, the differences achieved
SAVA GROUP
Educational structure
at 31 December 2005
1st level - incomplete primary school
2nd level - primary school
3rd level - up to 2 years of vocational school
4th level - at least 3 years of vocational school
5th level - secondary school
6th level - technical college
7th level - higher and university education
8th & 9th level - Master’s and Doctor’s degree
Age structure of employees
(32%)
In the Sava Group 46 per cent of employees are older
than 41 years, 21 per cent younger than 30 years, and 33
per cent of employees are between 31 and 40 years.
SAVA GROUP
Age structure of employees
at 31 December 2005
(in %)
0.9
reflect changes in the structure of the Sava Group. There
are fewer employees with up to 3rd level education and
those with 7th level education. In the future the level of
education will grow, since 3.7 per cent of all employees
study part-time.
(3%) (19%) (4%) (1%) (9%) (5%) (27%)
7.2
Voluntary supplementary
pension insurance
66 per cent of employees were included in the voluntary
supplementary pension insurance scheme of Kapitalska
Druœba and A Pokojninska Druœba. The average
premium paid by an individual and a company totalled
€33.7.
12.6
16.8 16.0
15.8 16.4
10.2
4.2
18-20 21-25 26-30 31-35 36-40 41-45 46-50 51-55 56+years

1 1 9 |
Sick leave
| s u s t a i n a b l e d e v e l o p m e n t r e p o r t |
The percentage of sick leave decreased in comparison
with the year before. In 2004 total sick leave amounted
SAVA GROUP
Sick leave
(in %)
more than 30 days
up to 30 days
total
Remunerating and motivating
employees
In 2005 too the basis for remunerating and promoting
employees was employee performance. Employees are
promoted on the basis of selective criteria such as
promotion due to a more demanding job, additional tasks
and duties, market adjustments, or after successfully
completing a training course. 324 employees were
promoted due to their good performance. Senior and
managerial staff as well as key specialists received
additional annual bonuses for achieving and surpassing
the planned results. The average percentage of the
variable part of salaries grew considerably in comparison
with 2004 from 2.9 to 4.12 per cent. By introducing a
new system of remuneration we plan to increase the
variable part by up to 10 per cent.
The average salary in the Sava Group totalled €1,026.5
or 4.1 per cent more than last year. In all companies
employees received a holiday allowance, while the
Christmas bonus was paid in companies that proved
particularly successful. 1,670 employees with no sick
leave during the year received cash awards. Various
to 4.9 per cent and in 2005 it totalled 4.2 per cent. Sick
leave of up to 30 days totalled 2.3 per cent, whereas sick
leave exceeding 30 days totalled 1.9 per cent.
4.83
2.28
2.55
4.86
2.59
2.27
4.20
1.93
2.27
2003 2004 2005
prizes are distributed according to the Rules on
Remuneration and Awards, which regulates cash
incentives in the form of awards for Model Worker (105
employees), Company Worker (10 employees) and Sava
Worker (8 employees).
With the 20 Keys project we encourage employees to
put forward useful suggestions and improvements. We
pursue trends by monitoring the indicator Number of
Useful Proposals per Employee within a personnel
balanced indicator system.
On Sava Day we awarded and presented prizes to best
and most successful employees. At pre-New Year’s
meeting 239 employees were awarded for a 10-, 20- or
30-year work jubilee, while 10 employees received the
Company Worker award for their outstanding
achievements, innovation and commitment to work.
Education
On-the-job training is of key importance for achieving
the professional and personal growth of an individual.
We therefore attempt to organise it to the maximum
volume possible. In the development of employees we
pursue our strategy and the development of operations.

a n n u a l r e p o r t | 2 0 0 5
1 2 0 |
We create an environment that is stimulating for lifelong
learning, innovative thinking, fostering an entrepreneurial
spirit and efficient team work. We involve promising
associates in strategic training and enterprising project
teams and direct them to more comprehensive
educational processes. The most promising associates
from these training programmes are then challenged with
a more demanding job.
The long-term educational model is continually adapted
with regard to the required expertise and variety of
target groups in the Group companies. We have named
the model Akademija Sava. 6,802 training hours were
achieved in 2005 which included over 320 associates.
After the programme was completed, 31 promising
young associates received diplomas for the successful
completion of the Promising Associates programme.
On average each employee received 70.5 hours of
education, whereas the average cost of education
amounted to €147.1 per employee. These costs also
include vocational training courses, part-time study and
trainee salaries.
Cost efficiency was mainly achieved by organising
internal training courses and appointing knowledge
administrators – employees who as specialists in their
respective area transfer their knowledge to associates
from other companies.
Diversity of operations, the local distance of certain
companies, sophisticated methods and cost efficiency
lead us to conduct training courses by utilising state-ofthe-art
tools provided by information and telecommunications
technology. By implementing the electronic
learning project we obtained funds from the European
Social Fund and Ministry of Labour, Family and Social
Affairs.
Over 1,000 associates were included in the project who
are now efficiently using their acquired competence
anew. Through the mentioned organisations we
obtained funds for Akademija Sava too as well as for
financing education provided by outside institutions.
The greatest focus in 2005 was given to the
implementation of various workshops to further develop
managers at all hierarchical levels. Internally we
provided specialised training courses. Since in Slovenia
it is not possible to achieve a formal level of education
in rubber manufacturing, we have prepared individual
sets of expertise to be implemented in monthly
workshops conducted by in-house lecturers. It is
planned to develop these workshops into an internal
rubber manufacturing school, in which associates learn
management and communication skills as well as how
to conduct employees. We organised workshops on the
strategic preparation for the next development period for
senior management. In Tourism training is provided by
transferring good practice within the companies from
this area and by presenting role models from abroad. We
arranged workshops for groups of employees who have
daily contact with guests to be able to establish and
strengthen their good relations with them.
Various awards prove that our education model is the
right one. In 2005 we received the Learning Company
Institute Award for outstanding achievements in
implementing the learning company concept. We
received the education management 2005 TOP 10 award
presented by GV Izobraœevanje and the Sofos Institute
to companies which systematically invest in the
education of their employees and establish direct links
between the education and business strategy.
Sava Dialogue annual interview
Sava Dialogue is an annual interview and one of the
established management tools in the Sava Group. It is an
in-depth, systematically conducted interview of a
superior with every employee separately. The interview
helps the employee to understand the long-term goals of
the company more clearly as well as identify her/his role
in daily work. At the same time it provides a breakdown
of strategic goals and activities to the level of work
teams. Through this procedure we try to design and
develop a clear future vision attainable by all
employees.
During the annual interview the superior and employee
discuss the estimates and possible development of 12
competencies that in the Sava Group have been selected
as a guideline and specialisation in personal
development. Associates are free to express their career
ambitions. The interview results are sent to the HR

1 2 1 |
| s u s t a i n a b l e d e v e l o p m e n t r e p o r t |
department for further analysis and supervision of the
agreed measures and proposals.
In 2005 the Sava Dialogue was conducted with 399
employees – 13 per cent of all employees in the Sava
Group.
Communicating with
employees
Internal communication is one of the more important
tasks and ensures that good relations are maintained
with and among employees, which is of key importance
in meeting customer requirements and securing lasting
competitive power and business success. However, it
also forms the basis for building the good reputation of
the company within the community and successful cooperation
with it.
Internally different communication tools are used such
as the Sava newspaper, monthly Informator bulletin,
information boards, notice boards, intranet, internet and
e-mail along with a number of personal forms of
communication such as interviews with employees,
meetings, internal training courses and employee
assemblies organised at least twice a year. The
Competence Centre HR, Law and Organisation as well
as management teams of all the companies collaborate
in implementing the latter. At employee assemblies the
Board presents the strategic policy of the Sava Group,
current projects and reports from the HR area. Several
times a year we participate in meetings with workers’
representatives from all companies of the Sava Group.
Once a year workers’ representatives meet the Board of
Management of Sava d.d. Associates attend the
meetings and Open Days held by the directors of
individual companies as well as regular meetings with
the management and the 20 Keys team meetings.
We have successfully collaborated with workers’
representatives and received numerous proposals from
them. The Trade Union and Workers’ Council were
notified of all procedures relating to a change in
employee activity where employment was terminated
due to business reasons, business results and a work
calendar proposal, change in job descriptions and
similar matters.
Organisational climate
measurement
After measuring the organisational climate in 2004 steps
were taken to improve and adapt it to meet the
requirements of individual companies. We focused on
improving internal communication, the personnel
development system and remuneration, which has
already been demonstrated by certain improvements.
Since changing the organisational climate is a long-term
process, we shall continue with the activities that have
already begun.
Rationalisation programme
of the HR function
The Competence Centre HR, Law and Organisation is
included in the continual improvement of business
processes. In 2005 we were repeatedly successful and
implemented savings of approximately €0.21 million.
Savings were mainly implemented through a selective
approach to overtime work by substituting it with a socalled
flexible work time organisation. Efficient
relocation of employees reduced the number of overtime
hours and work through student employment agencies.
Furthermore, we organised numerous internal training
courses for a larger number of employees.
For employing difficult-to-employ associates we
received financial support and a government subsidy,
which we present as savings too. We saved expenses
due to the announcement of vacant positions on the
electronic portal http://www.zaposlitev.net.
Disability issues
Persons with 2 nd and 3 rd category disabilities represent
6.4 per cent of all employees in the Sava Group. For
every disabled employee we sought a suitable job
adapted to her/his abilities and qualifications. With
regard to the condition evident from risk assessment, we
have prepared corrective measures to improve working
conditions for all employees. The number of disability
procedures decreases every year, which confirms the
efficiency of measures to improve working conditions.

a n n u a l r e p o r t | 2 0 0 5
1 2 2 |
Development of human
resources management
We are aware of the fact that readiness and employee
motivation for lifelong learning, personal development,
enterprise initiative, innovation and flexibility are
decisive for the further development and preservation of
a competitive edge in all of our operations.
In the Competence Centre HR, Law and Organisation
we have set a demanding goal for 2006. We will build a
new salary model linked to renewed job descriptions
and a uniformed remuneration system within individual
divisions of the Sava Group that will correspond to the
salary model as proposed by the government.
Our new leaders and those who will be promoted to such
positions shortly will be systematically trained in the
internal leadership school to made them familiar with
the basic management, communication and associate
23.2 Concern for employees
outside of working
hours
Our commitment to sustainable development and care
for employees obligates us to provide them with the
opportunity to actively spend their spare time. Therefore
we will launch a Life Cycle project in 2006, which is
based on organising activities run by the company and
involves as many employees as possible. The project is
an upgrade of already established forms of activity. We
offer employees holidays in our tourist facilities under
favourable conditions.
Individual companies – within legal regulations –
organise for their employees and close family members
various sports activities such as swimming, fitness and
others.
management skills. The personnel development system
is being introduced in all Sava Group companies
through annual interviews, incorporation in various
training schemes and development interviews with key
and promising associates. All companies will have a
standard personnel information and personnel manager
information system, which represents an important basis
for efficiently managing personnel processes. In the
rubber manufacturing area we intensively co-operate in
the support and performance of internal communication
processes and plan to further strengthen our activities in
this field. In the competence centre HR, law and
organisation we co-finance the project using European
social funds. We repeatedly obtained funds from the
European Social Fund and the Ministry of Labour,
Family and Social Affairs to carry out the training of our
employees. We will concentrate even more on employee
training in the Tourism division: by a transfer of good
practices among companies in the Tourism division and
presentations of good role models from abroad.
We foster cultural activities within the Sava Cultural
society, which has been active for more than 30 years. It
includes four groups that establish contacts with similar
societies both in Slovenia and abroad. The Sava folklore
group enjoys a good reputation with experts too.
Dancers, musicians, tamburizza players and singers held
many concerts and organised education courses. The
singers who appear under the name Deåve released their
CD. The art group held an exhibition at Extempore in
Piran and with neighbouring Austrian Carinthia the
group appeared in the joint project of the European
Union entitled Spread Together, in which a literary
group also took part. We established links with the
Macedonian society in Kranj and prepared a joint
literary meeting entitled The Preæeren’s Oro, continued
collaboration in the project launched by the Ækofja Loka
museum society and the Ivan Tavåar library called
Colourful Loka. The photography section members
attended a photo safari in the companies of Pannonian
Spas and showed the photos they took in two issues of
the Sava newspaper.

23.3
1 2 3 |
| s u s t a i n a b l e d e v e l o p m e n t r e p o r t |
Concern for employee
safety and health at
work
Employee healthcare
Employee healthcare in the Sava Group concentrates on
the prevention of illness both due to the working
environment and in connection with their work. We
strive to employ people in jobs that are adapted to their
psychological and physical abilities. 28 per cent of
employees received preliminary, periodic and specific
health examinations in 2005.
Health and safety at work
Achieving goals in health and safety at work was based
on a preventive approach that includes all employees. Our
final goal is to anticipate and successfully manage risk.
A great deal of attention is devoted to the frequency of
work-related injuries, precautionary measures, prevention
Many Sava employees respected the slogan Travel to Work in a
Different Way, and on 22 September rode their bikes to work
of social-related factors (especially stress and addiction to
psychoactive substances) and analysing new types of risk.
We encourage employees to live healthily and act on
time, also by being involved in initiatives such as the
pan-European campaign European Mobility Week. By
employing an integral approach, preparing special
folders and motivating employees we persuaded more
than one quarter of employees in our Kranj-based
facility not to drive by car to work on European Car
Free Day.
We are also involved in the pan-European campaign
launched by the European Occupational Safety and
Health Board called Stop the Noise. By making
employees aware of how important it is to protect
themselves and others against harmful noise, we
measured noise source levels at certain work places and
specified a list of noise sources. Employee children
made drawings to contribute to the pan-Slovenia
competition concerning occupational health and safety
invited by the Avgust Kuhar Foundation.
Award winners of the art competition (left to right): Blaœ Bevc,
Gaæper Trojar Kuhar, Marina Trojar Kuhar, Rok Bevc,
Andrej Logonder, Jakob Svetina, Vesna Logonder, Klara Svetina.

a n n u a l r e p o r t | 2 0 0 5
1 2 4 |
Decrease in the number
of work-related injuries
The frequency and seriousness of occupational injuries
decreased owing to a systematic approach in the
improvement of working conditions.
An orientation to safety at work is incorporated in our
business policy.
SAVA GROUP
No. of occupational injuries in the
companies of the Sava Group
from 2003 to 2005
SAVA GROUP
Frequency of occupational injuries
with sick leave in the companies
of the Sava Group
from 2003 to 2005
(per 200,000 working hours)
A commitment to and concern for safety are encouraged
by special preventive measures such as March – Safety
Month and October – Fire Safety Month.
Occupational safety forms a part of our business
programme that is intended for customers. During
European Occupational Safety and Health Week the
company Sava Trade d.d. exhibited its sales programme
aimed at personal protection in the International
Symposium for Occupational Safety and Health.
85
73
71
2003 2004 2005
3.2
2.9
2.6
2003 2004 2005

1 2 5 |
| s u s t a i n a b l e d e v e l o p m e n t r e p o r t |
Identifying stress through
education
Employee responsibility for one’s own safety is
encouraged by educating and training which comprises
training for safe work, strengthening an awareness of
how important safety at work is and anticipating new
types of risk. 57 per cent of employees participated in
training courses for safe work in 2005.
The principal aim of education is to provide new
information in relation to occupational safety and
health. In addition to legally prescribed forms of
theoretical and practical training courses for safe work,
periodic training courses and qualification examinations
we also encourage associate awareness by:
• providing weekly notices and advice on safety at work
on special notice boards;
• writing a column entitled Sreåko warns and gives
advice in a monthly bulletin Informator; and
• printing notices in the Sava newspaper.
Employees can give their suggestions to improve safety
directly to the respective specialised service.
Occupational health and safety,
OHSAS 18001 standard
Increasingly strict regulations, which are incorporated in
the operation of individual companies by applying
internationally valid system tools, are implemented to
enhance occupational health and safety. These
regulations are a successful risk management tool.
Most companies that seek to systematically reduce the
risk of injury or health disorders affecting their
employees apply the OHSAS 18001 standard
(Occupational Health and Safety Assessment Series)
whose basic principle is a continual improvement
process.
In 2002 and 2003 system tools for occupational health
and safety were applied in the rubber manufacturing
companies of the Sava Group. In 2004 the companies
Savatech d.o.o., Sava-Schäfer d.o.o. and Sava Trade d.d.
obtained certificates which prove their operations are
conducted in line with the OHSAS 18001 standard. In
2005 the certificate for a successfully introduced
occupational health and safety system was also obtained
by the company Radenci d.o.o. as the first spa resort,
hotel and catering company to do so.
OHSAS 18001 certificate for Terme Radenci

a n n u a l r e p o r t | 2 0 0 5
24.
1 2 6 |
Standards and Policies
Concerning Occupational Safety
and Health that we Respect and
Perform in the Sava Group
Our work concerning occupational health and safety at
the level of the Sava Group has since 2000 been directed
by the environmental policy at the Group level. The area
is managed by the competence centre Technical, Fire
and Environmental Safety (TPEV). The work of this
centre and setting goals is linked with conforming to
internationally valid general standards in the field of
safety as well as specialised standards, which represent
the best models in the branches where we operate:
• OHSAS 18001 standard (Occupational Health and
Safety Assessment Series) for system management of
occupational health and safety
- In 2004 the certificate was obtained by the companies
Savatech d.o.o., Sava-Schäfer d.o.o. and Sava Trade
d.d.
- In 2005 the certificate was obtained by Terme
Radenci d.o.o.
• The environmental certificate SIST EN ISO 14001
for environmental protection
- In 2000 the certificate was obtained by all Kranjbased
rubber manufacturing companies.
- In 2001 Ptuj-based rubber manufacturing companies
obtained the certificate.
- In 2004 the company from the Tourism division,
Terme Radenci d.o.o., and Sava Trade d.d. from the
Trade division obtained it.
• In 2005 the company Terme Radenci d.o.o. brought
its operations in line with the new environmental
standard ISO 14001:2004.
• Committed to Green programme
- In 2003 the company Golf in Kamp Bled d.d. joined
in the implementation of the programme of the
European Golf Association Committed to Green.
• A permit for using the logotype Responsible Care for
2004 and 2005 was obtained by the companies
Savatech d.o.o., Sava-Schäfer d.o.o. and Sava-GTI
d.o.o.
• In 2005 the Sava Group obtained the certificate Blue
Energy from the holding company Slovenske
Elektrarne and its business partners for the
economical use of energy and a contribution to the
Blue Fund.

25.
1 2 7 |
Sava d.d.
| s u s t a i n a b l e d e v e l o p m e n t r e p o r t |
Important Acknowledgements
and Awards in 2005
Company Achievement Acknowledgement/Award Institution
Sava d.d. Joint Best result and joint USP Institute and
acknowledgement acknowledgement in developing Slovene Chamber of
the learning Company concept Commerce and Industry
Sava Group TOP 10 An acknowledgement to a GV Izobraœevanje and
acknowledgement company which invests most in
employee education and training
the Sofos Institute
Sava Hotels&Resorts Bled
Company Achievement Acknowledgement/Award Institution
Wellness Œiva, Golden Plaque Achievement of the year in Slovene Chamber of
G&P Hoteli Bled d.o.o. developing tourist services Commerce and Industry
Camping Bled, 1st place My Country – Beautiful and Slovene Tourist Board
Golf in Kamp Bled d.d. Hospitable campaign, the
large-sized campsite category
Hotel Park Acknowledgement for Special acknowledgement for Slovene Fire-fighting
(G&P Hoteli Bled d.o.o.) co-operation co-operation in the international
fire-fighting drill
Association
G&P Hoteli Bled d.o.o., 20 medals and 52nd Catering Tourist Meeting Slovene Chamber of
Grand Hotel Toplice d.o.o. acknowledgements Commerce and Industry
Camping Bled, The Recommended The Dutch
Golf in Kamp Bled d.d. Campsite sign Association ANWB

a n n u a l r e p o r t | 2 0 0 5
1 2 8 |
Pannonian Spas
Company Achievement Acknowledgement/Award Institution
Terme 3000 d.d., Golden Sower Golden acknowledgement for Slovene Tourist Board
and Bike centre innovation
Hotel Ajda, Q Quality Sign Acknowledgement for quality Adminstrative Unit
Terme 3000 d.d. work in the area of Murska Sobota and
accommodation facilities national assessment
commission
Terme Radenci d.o.o. Silver diploma For the application according to Ministry of Higher
the Business Excellence Award Education, Science and
of RS Technology, Institute
for Metrology
Terme Ptuj d.o.o. 1 st place My Country – Beautiful and Slovene Tourist Board
Hospitable campaign, in the
medium- and small-sized
campsite category
Terme Ptuj d.o.o. 2 nd place My Country – Beautiful and Slovene Tourist Board
Hospitable campaign, in the
medium-sized campsite category
Terme Lendava d.d. 2 nd place My Country – Beautiful and Slovene Tourist Board
Hospitable campaign, in the
small-sized campsite category
Terme 3000 d.d. 2 nd place My Country – Beautiful and Slovene Tourist Board
Hospitable campaign, in the
large-sized campsite category
Terme 3000 d.d. Best arranged Slovene Best Swimming Pool Good Morning,
swimming pool 2005 campaign a TV Slovenia show
facilities
Terme Ptuj d.o.o. 2 nd place in the large Slovene Best Swimming Pool Good Morning,
thermal swimming 2005 campaign a TV Slovenia show
pools category
Terme 3000 d.d. Golden pin 52 nd Catering and Slovene Chamber of
Tourist meeting Commerce and Industry
Terme 3000 d.d., 44 medals and 52 nd Catering Slovene Chamber of
Terme Radenci d.o.o., acknowledgements Tourist meeting Commerce and Industry
Terme Lendava d.d.,
Terme Ptuj d.o.o.,
Terme Banovci
Milan Karoli, Acknowledgement Acknowledgement and golden Slovene Chamber of
hotel director, and golden plaque plaque for a contribution to the Commerce and Industry
Terme 3000 d.d. for quality and quality of spa resort tourism
success at GTZ in Pomurje
Daniel Kozar, 2 silver medals Award in menu cooking and International Culinary
member of the Slovene exhibition of cold culinary Arts Competition,
national Olympic team, delights Basel, Switzerland
Terme 3000 d.d.
Daniel Kozar Silver medal Award for a self-prepared dish at Trade Exihibition for the
member of the Slovene the European Culinary Arts Hotel Industry and
national Olympic team, Competition Gastronomy, Salzburg,
Terme 3000 d.d. Austria
Stanko Jerebic, Special Slovene Chamber of
Terme Radenci d.o.o. acknowledgement Commerce and Industry
for achievements

26.
1 2 9 |
Sport
| s u s t a i n a b l e d e v e l o p m e n t r e p o r t |
Developing the
Social Community
Our investments in sport, culture, humanitarian campaigns, professional development of the company and
environmental issues help the broader and narrower social community to develop. Our priority is to
collaborate in long-term projects that can contribute to the development of a larger number of people
especially children. In addition to financial support we provide our long-term partners with organisational
support and the active involvement of employees in individual projects.
26.1 Sponsorship for and
donations to the social
community
We build our relations on respect, understanding and an
open dialogue.
Through sponsorships and donations the companies of
the Sava Group are integrated in individual local
SAVA GROUP
Sponsorship and donations
Sport
Culture
Professions/Education
Social/humanitarian campaigns
Ecology
(62%)
For many years a substantial share of sponsorship funds
has been earmarked for the Sava Cycling Club, one of
the largest and most successful clubs in Slovenia in the
past 35 years. Valter Bonåa was a particularly successful
communities. When it comes to larger national and
international projects, they are united under the auspices
of the holding company Sava d.d., and thus represent the
Sava Group. We especially assist non-profit societies,
organisations and institutions and concentrate on
providing assistance to children and their development.
In 2005 the Sava Group earmarked more than
€4,734,000 for sponsorships and donations, which is 20
per cent more than in 2004.
(14%) (10%) (8%) (6%)
athlete of the club. In the Krka Grand Prix our cyclists
won an historic triple victory and were successful in
many other competitions at the local, national and
international level. A team of the youngest athletes won
all categories in the Orangina Cup, which further proves
successful co-operation.

a n n u a l r e p o r t | 2 0 0 5
1 3 0 |
We are continuing to sponsor Triglav Ski Club. On a
modern ski jump – Bauhenk under Æmarjetna Gora –
training conditions are excellent and it can host
competitions at the highest level. In the beginning of
2006 the Nordic Junior World Championships were
held, with Sava d.d. participating in the organisation. In
summer the Grand Prix will take place on an artificial
ski jump with the world’s best jumpers participating.
We sponsor team sports as well. Sava Handball Club
joined with the Planina team to enable the youngest
girls’ selection to become familiar with handball, while
the seniors are faced with new challenges. The OBI
store sponsored the junior team of Kranj Football Club,
while Savatech d.o.o. sponsored Olimpija Volleybal
Club, and Sava Trade d.d. Jeœica Baseball Club.
This year too we sponsored the traditional Ljubelj 2005
Oldtimers’ Race for the Hrast Memorial, which had
more than 3,000 visitors. Terme Lendava provides funds
for the advancement of the sport of speedway.
The companies in Tourism earmarked considerable
funds for donations and sponsorships in sport. The
company Terme 3000 d.d. sponsored numerous
societies – Union Olimpija Basketball Club, the football
players of Mura 05 and Åarda, female football players of
Pomurje Len, the table-tennis club Moravske Toplice,
the grass hockey team NTK Moravske Toplice, and also
the young golfer, Vanja Bransberger. The companies
Terme Lendava d.d. and Terme Ptuj d.o.o. sponsor
football players and ballooning. Sava Hotels Bled
sponsored golf advancement and enabled three primary
schools to purchase and assemble golf equipment. They
also sponsored Bled Rowing Club, Partizan Œirovnica
Gymnastic Society and Œirovnica Mountaineering
Society.
Culture
We further remain active in spreading culture and
preserving cultural heritage and have therefore
established several long-term partnerships. We
sponsored the year-round project Synergy of the Art and
Business World, launched by the world renowned
virtuoso violin player Miha Pogaånik, in which he
discovered the paths to new ideas in the economy and
decision-making process of managerial teams through
classical music.
With the Museum of Gorenjsko we concluded a fouryear
general sponsorship agreement on the birth-place
home of the great Slovene poet Dr. France Preæeren in
Vrba and collaborated in the exhibition to celebrate the
100 th anniversary of the Slovene film industry. We
enrich the cultural life of the local community through
faithful collaboration with the Preæeren Theatre in
Kranj.
For several years we have been partners in the world’s
unique cultural Growing Book project. The idea about
Slovenia being proud of its literature is spreading
because every year we sponsor The Franc Rozman-
Stane Institution and the Just One Flower event. We
supported numerous book issues published by the
League of Combatants in the Second World War and
contributed to the Walk along Partisan Trails of
Jelovica event and the erection of the pan-Slovenian
monument to the T.I.G.R. combatants and people who
defended the Slovene homeland in Veliko Cerje above
Nova Gorica.
The company Sava Hotels&Resorts Bled is the general
sponsor of the Dana Renåelj international ballet school
of Bled as well as the Bled Festival, the international

1 3 1 |
| s u s t a i n a b l e d e v e l o p m e n t r e p o r t |
summer contest for musicians. We aided the
Macedonian cultural society Sv. Ciril and Metod Kranj
in arranging premises for their work. Jointly with the
company Sava Trade d.d. we contributed to the
implementation of certain events during Kranj Youth
Week. The company Savatech d.o.o. collaborated with
the Academy of Fine Arts of Ljubljana University in
designing a new tread pattern for a scooter tyre.
Tourist operations correspond to public and cultural
events. The company Terme 3000 d.d. was involved in
the events of the Days of Sobota and Koæiå, andthe
Beltinci Festival and also assisted in the renovation of
churches. The companies Terme Lendava d.d. and
Terme Ptuj d.d. helped in the preservation of folk art by
making a contribution to ethnographic groups, choirs
and a musical society.
Professional development
Sava d.d. is a co-founder of organisations of broader
social importance such as the Joœef Ætefan International
Post-graduate School, Institute for the Development of a
Learning Company and the Development Forum of
Gorenjsko.
Professional achievements are companions of economic
progress. In 2005 we sponsored the final conference of
the international interdisciplinary research project
Manufacturing Visions – Quo Vadis? On the basis of a
research project, which included almost 3,000 experts,
22 countries and 31 European institutions, the
conference should determine the guidelines for future
industrial development in Europe with the aim of
becoming the best competitive economy by 2010.
Savatech d.o.o. took part in the research.
We took over sponsoring the conference Manageress
Excellence, organised by the Section of Manageresses at
the Managers’ Association of Slovenia in collaboration
with the international business school IEDC Bled. We
also established contact with the Metrology Institute RS
and sponsored the awards ceremony of the Business
Excellence Awards of the Republic of Slovenia and
provided professional and financial assistance in
publishing the book Learning Company – Create a
Company of Know-how. Assistance was given to the
Association of Safety Engineer Societies to organise the
8 th symposium on safety and health at work where the
Avgust Kuhar Foundation awards were presented.
Our aspirations for a balanced social development led us
to form a partnership with the IFIMES Institute, the
International Institute for Middle-East and Balkan
Studies, which has its head office in Ljubljana. The
Institute is involved in crisis areas, rescue and
preliminary conflict prevention.
The companies in Tourism helped in implementing
projects of the Slovene Tourist Board, which celebrated
its 100 th anniversary, as well as the Tourist Association
of Pomurje. Pannonian Spas sponsored the Diamant
chef team. The Slovene Olympic chef team found a
long-term partner in Sava Hotels Bled that will sponsor
it in the following four year period. Preparations prior to
departure for the world chef competition in Basel were
held in Grand Hotel Toplice d.o.o.
The company Savatech d.o.o. is also loyal to the Faculty
of Chemistry and Chemical Technology in Maribor. It
also sponsored the issue of a new presentation CD of the
Kranj Technical School Centre, thereby joining
endeavours to popularise technical professions.
All companies of the Sava Group are involved in the
development of education and training institutions in
their local environments. They supported their
educational programmes, donated computer equipment
and awarded pupils for their success in various
competitions and research projects.
Aid in distress
One part of our social role is understanding the needs of
the social environment.
We contributed funds and actively participated in the
Mayor’s Race through the streets of Kranj, which is
organised to collect funds to help addicts. Through the

a n n u a l r e p o r t | 2 0 0 5
26.2
1 3 2 |
Good Thought campaign sponsored by Kapitalska
Druœba we donated funds to purchase new equipment
for the Oncology Institute in Ljubljana.
In collaboration with the Youth Friends’ Society in
Kranj we enabled children from deprived families to
enjoy free holidays at the seaside. Repeatedly we were
partners in the Young Mums campaign, in which we
gave New Year gifts to children from student families.
On Bled golf course the Friendship Tournament for the
President’s Cup was held; the fee proceeds and a
Integration in the social
community
The Sava Group is represented in public by its
employees who in their spare time are involved in
various professional associations, organisations and
voluntary activities.
contribution by the company Golf in Kamp Bled d.d.
were donated to the development centre of the
kindergarten in Bled for pre-school children with special
needs.Through the Slovene Karitas charity organisation
the company Sava Trade d.d. sent material for building
emergency shelters in Sri Lanka, which had been
devastated by natural disaster.
Through minor donations we helped numerous societies
and organisations that are endeavouring to bring a ray of
light to deprived people.
They collaborate in the local community and municipal
bodies, various professional and business associations,
branch organisations, specialised associations for
quality development, as well as in expert consultations,
seminars, congresses and other professional meetings.
They welcome the representatives of governmental and
non-governmental organisations, economic delegations
and other interested public groups and act in various
non-profit organisations.

1 3 3 |
| s u s t a i n a b l e d e v e l o p m e n t r e p o r t |
27. Protecting the Environment
and Fire Safety
Consistent with the law we manage our operations to attain a continual decrease in negative environmental
influences and the prevention of pollution.
Therefore we have committed ourselves to:
• assess the impact on the environment with every new operation;
• develop new products and services that are safe in production and use as well as their environment-friendly
disposal;
• discontinue using hazardous substances;
• plan, design and operate tools and procedures with the maximum economical use of energy and raw
materials and reduce the environmental burden;
• consider prescribed pollution limit values when selecting new equipment and technology;
• monitor environmental influences and take steps in case of irregularities;
• educate, train and make all employees aware of working responsibly;
• co-operate with interested parties in an open and cultural dialogue and, consequently, contribute to the
success of joint efforts invested by the company to improve environmental protection;
• encourage suppliers and contractors to use new environment management systems and respect
environmental legislation; and
• announce our success to the public.
27.1 Environmental protection
Our priority goals are:
• the economic use of energy, raw materials and natural
resources;
• separate collection and recycling of waste to decrease
the quantity of waste for disposal;
• the prevention of environmental pollution;
• substitution of hazardous substances with less
hazardous ones; and
• the training of employees on environmental issues.
Operations of all rubber manufacturing companies are
certified according to the SIST EN ISO 14001
certificate. In the Ptuj-based company Sava-GTI d.o.o.
we began conducting business in compliance with the
environment management certificate back in 2002. This
year the operation was re-assessed, and in line with the
mentioned standard, we obtained the second environment
management certificate.
In the company Terme Radenci d.o.o. environmental
management is performed in accordance with the
international standard SIS EN ISO 14001. In 2005 this
operation was adapted to the new environment
management standard ISO 14001:2004. In the company
Golf in Kamp Bled d.d. we continued to adapt this
operation to conform to the Committed to Green
programme. In the company Teol d.d. we introduced an
integrated system to balance the environment
management and occupational health and safety system
with the already introduced quality system according to
the ISO 9001/2000 standard.
By promoting environmental awareness among
employees we collaborate in campaigns in the narrower
and broader social community. Together with more than
400 participants from various societies and Kranj
citizens and residents from Straœiæåe we participated in
the fourth Let’s Clean Kranj campaign organised by the
Kranj Scouts Association, the Municipality of Kranj and
the Sava Group.

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1 3 4 |
Grand Hotel Toplice d.o.o. Bled and Bled High School
for Catering and Tourism raised funds by selling tickets
and donated the proceeds to Bled Tourism Society for
the protection of swans. Sava Hotels Bled and Bled
Tourism Society honoured the Day of Earth and the
100 th anniversary of the Slovene Tourist Association in
the park of Vila Hotel Bled by planting the symbol of
Slovenia – a lime tree.
Environmental indicators
We regularly monitor environmental indicators and
introduce measures to decrease the impact of our
operations on the environment in individual companies
and at the level of the entire Sava Group.
The following environmental indicators are measured
on a monthly basis:
Environment management certificate ISO 14001: 2004 for Terme
Radenci
• energy consumption;
• drinking water consumption;
• water pollution;
• air pollution;
• space occupied by stored waste;
• use of hazardous substances; and
• noise.
Responsible handling
The Responsible Handling Programme is the Slovene
name for the international initiative from the chemical
industry called Responsible Care. The Chemical
Industry Association at the Slovene Chamber of
Commerce and Industry granted the right to use the
Responsible Care logo to 18 companies. The companies
of the Sava Group Savatech d.o.o. and Sava-Schäfer
d.o.o. have been granted this right repeatedly.
Responsible Care logotype

27.2
1 3 5 |
| s u s t a i n a b l e d e v e l o p m e n t r e p o r t |
Efficient use of energy
Energy sources
The companies of the Sava Group use various energy
sources. In the consumption structure electricity has the
largest share with 36 per cent and is followed by steam,
natural gas, heating oil and propane/butane gas. In 2005
energy consumption totalled 142,678,613 kWh.
We received an award for economical energy
consumption. The holding company Slovenske Elektrarne
SAVA GROUP
Share of individual energy source
Electricity
Steam
Natural gas
Heating oil
Propane/butane
Energy-related check-ups
In 2005 eight buildings in various companies of the
Sava Group were inspected in relation to energy
consumption. All inspections demonstrated a possible
decrease in energy consumption and, consequently,
costs. Based on the anticipated short- and long-term
technical and other measures for efficient energy
consumption, we plan to not only reduce specific energy
consumption but energy costs too, or at least maintain
them at this level, despite the rise in prices and
expansion of production and tourism facilities.
Significant achievements in
decreasing the consumption
of energy sources
Natural gas
In comparison with last year the rubber manufacturing
companies Savatech d.o.o. and Sava-Schäfer d.o.o.
(28%)
and its business partners presented us with a certificate
which proves that 10 per cent of the electricity we
consume is generated from renewable sources and thus
contributes to the Blue Fund, which is intended for the
development of renewable energy sources in Slovenia.
By integrating in the National Plan of the Republic of
Slovenia on distribution rights for greenhouse gas
emissions in the period 2005-2007 the company Radenci
d.o.o. committed itself to collaborating in the first period
of reducing emissions within the European Union and
will reduce greenhouse gas emissions by 10.6 per cent.
(27%) (8%) (0.7%) (36%)
reduced the specific natural gas consumption used for
steam production by 19.8 per cent, in Terme
Radenci d.o.o. by 9 per cent and in Terme Ptuj d.o.o. by
6.1 per cent.
Electricity
Specific electricity consumption decreased in
comparison with last year. In Terme Lendava it was
decreased by 19.6 per cent, in Golf in Kamp Bled d.d.
by 6 per cent, in Grand Hotel Toplice d.o.o. by 1.9 per
cent, in the rubber manufacturing companies Savatech
d.o.o. and Sava-Schäfer by 1.3 per cent, and in Terme
Radenci d.o.o. by 1 per cent.
Heating oil
Consumption was decreased in Terme Radenci d.o.o.,
Hotel Jeruzalem by 35 per cent, Golf in Kamp Bled d.d.
by 9 per cent, and in G&P Hoteli Bled d.o.o. by 4.8 per
cent.

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1 3 6 |
Propane-butane gas
The consumption of propane-butane gas was 4.5 per
cent lower than last year.
Decrease in drinking water
consumption
We regularly monitor the pollution level of industrial
water effluents from our manufacturing facilities. The
results demonstrate that pollution is below the
prescribed limits.
We continued the project of drinking water consumption
by:
• employing methodical detection of drinking water
leakage in water pipelines and eliminating faults at the
same time;
Specific drinking water
consumption on the
Labore premises
(in m3 SAVA GROUP
water/metric tons of product)
SAVA GROUP
Specific river water consumption
on the Labore premises
(in m 3 water/metric tons of product)
21.7
33.3
• regularly monitoring water consumption; and
• ensuring the efficient use of water.
In one year the Kranj-based companies reduced drinking
water consumption by 11.6 per cent. This is the most
important achievement resulting from our systematic
approach in environmental protection. Specific river
water consumption was reduced by 21 per cent in the
Kranj-based companies.
The consumption of tap water was reduced in Teol d.d.
by 10 per cent, Terme Lendava d.d. by 27 per cent,
Grand Hotel Toplice Bled d.o.o. by 7.5 per cent, G&P
Hoteli Bled d.o.o. by 6.4 per cent, and in Terme Ptuj
d.o.o. by 3.6 per cent.
19.9
30.9
16.4
Average
2000 2001 2002
32.0
Average 2000 2001 2002
7.4
4.3
2003 2004 2005
30.1 29.7
3.8
23.7
2003 2004 2005

1 3 7 |
| s u s t a i n a b l e d e v e l o p m e n t r e p o r t |
Lower dust particles and
organic solvent emissions
Due to the installation of filtering apparatus in key
processes in recent years emissions of dust particles
were almost completely eliminated. The measurement
results are considerably below the permissible limits.
Annual dust emissions were reduced by 20 per cent.
A high reduction in the emissions of organic solvents in
the Print programme is due to the regular operation of
the thermal incineration plant. In Teol d.d. organic
solvent emissions per metric ton of products was
reduced by 12 per cent. Ammonia emissions in Etopon
in the production of the same company amount to 62
kilos per year, which is within legal requirements.
Filters; Filters; Filters;
Permissible limits sandblasting in grinding offset rubber in use of powder chemicals
for dust particles the Roll Service programme the Print programme in the Elastomers programme
mg/m 3 mg/m 3 mg/m 3 mg/m 3
50 0.06 –0.12 0.01- 0.03 0.01 -0.05
Less waste and hazardous
substances
In the companies of Rubber Manufacturing we ensure
safe and professional waste disposal. Years ago Savatech
d.o.o. introduced separate waste collection according to
type and property. Rubber waste and non-hazardous
industrial waste are disposed of in landfills. Wooden,
metal, paper and plastic waste is recycled, while
hazardous substances and their packaging are incinerated
or recycled.
SAVA GROUP
Specific quantity of all landfilled
waste in Rubber Manufacturing
(kg/metric tons of product)
139
Due to the changed products structure the specific
amount of waste increased by 2.8 per cent.
In accordance with our plans, which specify the
handling of waste, and based on the basic principles of
the strategic policy for handling waste in the Republic of
Slovenia, the companies of the Sava Group are
committed to gradually reduce the quantity of waste.
We will collect waste fractions as pure as possible and
increase the utilisation of their substances and energy
value.
119
98
Average
2000 2001 2002
82,2
68
70
2003 2004 2005

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27.3
1 3 8 |
Mixed sewage waste generated in the hotel, catering and
spa resort operations is collected separately, too.
In 2005 the quantity of sewage waste was reduced in
Terme Radenci d.o.o. by 24 per cent, G&P Hoteli Bled
d.o.o. by 11.6 per cent and in Golf in Kamp Bled d.d. by
4.2 per cent.
We are systematically decreasing the use of hazardous
substances. In the company Teol d.d. ethylene-oxide is
no longer used in the production of etoxilate. The
greatest progress in decreasing the specific use of
hazardous substances was achieved with the
introduction of certain improvements in the technology
of rubber profiles production in Rubber Manufacturing
where the specific use of nitrite- and nitrate-based LCM
salts was substantially reduced.
Noise
The noise level in the Kranj-based rubber manufacturing
companies during the day and at night was considerably
decreased through the following technical measures:
•a noise barrier in front of the solvent pumping station
next to the Print programme building of the company
Savatech d.o.o.;
•a noise barrier by the cooling tower adjacent to the
Elastomer programme building of the company
Savatech d.o.o.;
Fire safety
Systematic safety operations (environmental protection,
safety and health at work and fire safety) demonstrate
positive effects also in the field of fire safety. The number
of fires has considerably decreased over recent years.
Despite continual improvements in preventive actions
with respect to fire safety, employee training to implement
fire safety measures and the resulting performance of these
planned measures, the risk still exists.
As part of the preventive campaign related to fire safety
individual companies of the Sava Group organised
theoretical and practical training in October.
•a noise barrier in front of the apparatus for filtering air
polluted with grinds from the Sava-Schäfer d.o.o.
plant; and
•a silencer on the ventilation system outlet in the Velo
programme of the company Savatech d.o.o.
The results of monitoring show that noise levels during
the day and at night do not exceed the prescribed limits.
MEETING THE NEIGHBOURS
In the companies that operate on the Sava premises we
have regularly held meetings with neighbours ever since
1998. 43 residents accepted an invitation for a
traditional meeting that was held on 24 November 2005.
Representatives of the company Savatech d.o.o.,
Goodyear – EP and Sava Tires d.o.o. acquainted
participants with the achievements in decreasing the
impact on the environment, innovations and
improvements in environmental protection and safety
and health at work. We presented our plans concerning
environmental protection for the following year.
Residents also viewed a new business and production
facility of the EKO programme for environmental
protection and rescue products, which forms a part of the
company Savatech d.o.o.
Several times a year the rubber manufacturing
companies carry out unannounced simulation drills. In
September an unannounced fire drill Fire on Line KS
2000 in the Conveyor Belt programme, part of the
company Savatech d.o.o., was carried out. In October a
simulated fire-fighting drill was carried out in the Print
programme in the company Savatech d.o.o. The purpose
of both drills was to check the abilities of employees to
intervene in case of fire at their work places and the
competence of the intervention team of the Sava firefighting
unit. Both drills proved that employees and the
team alike are sufficiently qualified to intervene in case
of fire.

27.4
1 3 9 |
| s u s t a i n a b l e d e v e l o p m e n t r e p o r t |
Training employees on how to react in case of a fire hazard or
intervening in case fire breaks out in the companies Teol d.d. and
Sava-GTI d.o.o.
On an initiative of the organisers of the 16 th
International Fire-fighters Meeting we were involved in
the national fire-fighting drill Fire 2005 that took place
on 28 May in the Hotel Park building in Bled. The
tactical fire-fighting drill was based on the assumption
that fire had broken out in one of the hotel rooms. The
Environmental safety
in the future
Responsibility towards the environment will be
demonstrated further by meeting legal requirements and
upgraded by the introduction of state-of-the-art methods
and standards governing improvements in environmental
protection.
In the company Savatech d.o.o. activities will be
oriented to obtain an integral environmental permit. In
Tourism’s golf course we will focus on preserving the
diversity of animal species. We will endeavour to build
Checking qualifications of intervention teams in the Fire on Line
KS 2000 drill
drill proved that procedures for intervention under
extraordinary circumstances were suitable and so was
handling by employees and hotel guests. Co-ordination
of the protection and rescue part of the drill was good
and qualifications highly professional.
a bypass road to relieve the hotel surroundings and Bled
lake of exhaust fumes. The international HACCP
standard that ensures the production of safe food is due
to be adopted. It is based on analysing risk and finding
critical issues.
We will strengthen the culture of preventing risk and
encourage co-operation among all those involved in
health and safety at work.
In planning and monitoring our future operations we
will respect the principle that preserved nature is the
best heritage for future generations.

a n n u a l r e p o r t | 2 0 0 5
1 4 0 |
The path upwards requires investment.
Therefore the Sava Group makes major investments,
the total investment value in 2005 exceeding
€37.6 million. The same amount will be invested
in 2006 when our comprehensive investment cycle
is due for completion.

Vanja Bransberger,
golf player,
national junior champion
1 4 1 |
| f i n a n c i a l r e p o r t |

a n n u a l r e p o r t | 2 0 0 5
28.
28.1
1 4 2 |
Financial Statements of the
Sava Group with Notes in
accordance with International
Financial Reporting Standards
Audited consolidated financial statements of
the Sava Group in accordance with International
Financial Reporting Standards
Consolidated Income Statement for the year 2005
(SIT in thousands)
Note 2005 2004
Net sales revenues from goods sold and services rendered 58,461,843 56,385,784
Change in inventories of products and work in progress 967,030 188,980
Other operating revenue 5 2,016,853 4,638,016
Operating revenue 61,445,726 61,212,780
Cost of goods, materials and services -41,678,587 -39,176,844
Labour cost 6 -13,280,230 -12,378,454
Depreciation and amortisation -3,597,950 -2,880,373
Other write-offs 7 -376,338 -1,455,963
Other operating expense 8 -521,204 -636,663
Operating expenses -59,454,309 -56,528,297
Operating income 1,991,417 4,684,483
Financial income 5,854,543 6,989,972
Financial expense -2,070,087 -3,057,454
Net financing income 9 3,784,456 3,932,518
Share in income of associates 10 4,692,039 3,895,152
Pre-tax profit 10,467,912 12,512,153
Tax 11 -1,252,339 -860,704
Net profit for the year 9,215,573 11,651,449
Net profit for the year attributable to:
Equity holders of the parent 9,162,673 11,580,064
Minority interest 52,900 71,385
Net profit for the period 9,215,573 11,651,449
Basic earnings per share (SIT) 4,572.88 5,970.81

| consolidated financial statements in accordance with IFRS |
ASSETS
1 4 3 |
Consolidated Balance Sheet as at 31 December 2005
(SIT in thousands)
Note 31/12/2005 31/12/2004
Property, plant and equipment 12 61,501,098 57,420,827
Intangible assets 13 284,010 350,216
Investment property 14 3,322,896 2,337,783
Investments in associates 15 29,033,709 25,657,063
Non-current equity securities 16 33,430,277 32,141,290
Non-current receivables 17 2,704,451 442,475
Non-current assets 130,276,441 118,349,654
Inventories 18 10,543,373 10,614,956
Trade and other receivables 19 12,024,773 11,460,158
Current tax receivable 18,623 8,517
Current loans 20 574,234 1,042,284
Cash and cash equivalent 21 2,568,857 713,168
Current assets 25,729,860 23,839,083
Totals assets 156,006,301 142,188,737
EQUITY AND LIABILITIES
Issued capital 20,069,870 20,069,870
Share premium 30,100,770 30,100,770
Reserves 8,382,996 6,238,856
Fair value reserve 6,560,951 10,206,362
Treasury shares -53,787 -53,787
Retained earnings 27,952,373 22,176,134
Total equity attributable to equity holders of the parent 93,013,173 88,738,205
Minority interest 1,143,753 1,815,107
Total equity 22 94,156,926 90,553,312
Non-current provisions 23 1,824,309 1,747,087
Deferred government grants 24 2,054,562 753,292
Non-current interest-bearing borrowings 26 14,480,373 11,698,555
Non-current operating liabilities 17,418 47,329
Deferred tax liabilities 25 1,784,701 3,058,867
Non-current liabilities 20,161,363 17,305,130
Current interest-bearing borrowings 26 30,642,855 23,137,273
Current operating liabilities 27 10,707,024 10,787,794
Accrued expenses 28 338,133 405,228
Current operating liabilities 41,688,012 34,330,295
Total liabilities 61,849,375 51,635,425
Total equity and liabilities 156,006,301 142,188,737

a n n u a l r e p o r t | 2 0 0 5
CASH FLOWS FROM OPERATING ACTIVITIES
1 4 4 |
(SIT in thousands)
2005 2004
Profit before taxation 9,215,573 11,651,449
Adjustments for:
Consolidated Statement of Cash Flows for the year 2005
Depreciation of property, plant and equipment 3,402,112 2,702,560
Depreciation of intangible assets 99,459 79,727
Depreciation of investment property 96,372 98,086
Impairment in property, plant and equipment 42,382 964,842
Impairment of intangible assets 51,431 21,999
Impairment in investment property 7,171 0
Impairment of financial investments 476,294 1,163,814
Revenues from elimination of negative goodwill -309,743 -3,467,619
Proceeds from sale of plant, property and equipment -1,050,978 -572,367
Loss at disposal of property, plant and equipment 21,156 93,563
Profit in sale of current financial investments 0 -3,335,892
Profit in sale of non-current securities -4,792,718 -2,786,801
Loss in sale of securities 56,847 69,305
Share in income of associates -4,692,039 -3,895,152
Other dividends received -492,590 -97,613
Interest expense 1,463,187 1,460,343
Interest revenue -344,370 -286,250
Income tax liability 1,252,339 860,704
Income from operations prior to change in operating equity and provisions 4,501,885 5,147,289
Change in non-current receivables -2,261,976 328,884
Change in current receivables -544,786 1,784,305
Change in inventories 29,670 1,201,502
Change in current operating liabilities and accrued costs -112,062 -7,175,720
Change in non-current operating liabilities -88,940 -147,424
Change in provisions 77,221 76,002
Change in government grants 1,301,270 275,954
Acquired cash in operations 2,902,282 1,490,792
Paid income tax -1,312,192 -507,931
Net cash flow from operations 1,590,090 982,861

| consolidated financial statements in accordance with IFRS |
CASH FLOWS IN INVESTING ACTIVITIES
1 4 5 |
(SIT in thousands)
2005 2004
Purchase of property, plant and equipment equipment -9,018,105 -8,890,167
Proceeds from sale of property, plant and equipment equipment 2,523,162 2,218,157
Purchase of intangible assets -85,400 -126,878
Proceeds from sale of intangible assets 17,538 0
Purchase of investment properties -1,491,865 -110,449
Proceeds from sale of investment properties 403,209 381,280
Purchase of subsidiaries -293,685 -11,970,898
Proceeds from sale of subsidiaries 0 3,729,463
Purchase of associates -133,920 -3,526,367
Proceeds from sale of current financial investments 0 10,072,804
Proceeds from repaid loans 468,050 0
Expenses for granted loans 0 -149,498
Purchase of equity securities available for sale -11,858,738 -12,307,750
Proceeds from sale of non-current securities 10,056,744 6,438,586
Received dividends of associates 1,361,350 552,960
Other dividends received 492,590 97,613
Received interests 339,526 262,396
Net cash flow from investment activities -7,219,544 -13,328,748
CASH FLOWS IN FINANCING ACTIVITIES
Increase in share capital 0 8,008,000
Other increase in equity -97,013 0
Proceeds from granted non-current loans 7,117,350 4,856,420
Expenditures for granted non-current loans -1,686,722 -1,065,506
Proceeds from granted current loans 16,425,408 12,071,922
Expenses for granted current loans -11,568,636 -11,065,350
Expenses for dividends of Group's shareholders -1,242,294 -1,160,348
Paid interests -1,462,950 -1,554,648
Net cash flow from financing activities 7,485,143 10,090,490
Net increase or decrease in cash and cash equivalents 1,855,689 -2,255,397
Cash and cash equivalents at year begin 713,168 2,968,565
Cash and cash equivalents at year end 2,568,857 713,168

a n n u a l r e p o r t | 2 0 0 5
1 4 6 |
Consolidated Statement of Changes in Equity for the year 2005
(SIT in thousands)
Issued Share
Fair
value Treasury Retained Majority Minority
capital premium Reserves reserve shares earnings interest interest TOTAL
Balance 01/01/2004 17,209,870 24,952,770 4,700,980 5,305,941 -54,195 13,294,702 65,410,068 1,679,729 67,089,797
Entry of
called-up capital 2,860,000 5,148,000 0 0 0 0 8,008,000 0 8,008,000
Profit 2004 0 0 0 0 0 11,580,064 11,580,064 71,385 11,651,449
Profit allocation
to reserves 0 0 1,538,284 0 0 -1,538,284 0 0 0
Dividend and
bonus payout 0 0 0 0 0 -1,160,348 -1,160,348 0 -1,160,348
Revaluation of
securities available
for sale to
fair value 0 0 0 5,559,173 0 0 5,559,173 0 5,559,173
Decrease due
to sale of
securities 0 0 0 -658,752 0 0 -658,752 0 -658,752
Selling company
with minority
interest 0 0 0 0 0 0 0 -656,871 -656,871
Acquired by
purchase of
new companies 0 0 0 0 0 0 0 1,004,739 1,004,739
Decrease in
minority interest
due to purchase
of stakes 0 0 0 0 0 0 0 -283,875 -283,875
Others 0 0 -408 0 408 0 0 0 0
Balance 31/12/2004 20,069,870 30,100,770 6,238,856 10,206,362 -53,787 22,176,134 88,738,205 1,815,107 90,553,312
Profit 2005 0 0 0 0 0 9,162,673 9,162,673 52,900 9,215,573
Dividend payout 0 0 0 0 0 -1,242,294 -1,242,294 -1,242,294
Profit allocation
to reserves 0 0 2,144,140 0 0 -2,144,140 0 0 0
Revaluation of
securities available
for sale to fair value 0 0 0 -2,128,424 0 0 -2,128,424 0 -2,128,424
Decrease
due to sale of
securities 0 0 0 -1,516,987 0 0 -1,516,987 0 -1,516,987
Decrease in
minority interest
due to purchase
of stakes 0 0 0 0 0 0 0 -627,241 -627,241
Decrease in minority
interest due to
transition under joint
management 0 0 0 0 0 0 0 -97,013 -97,013
Balance 31/12/2005 20,069,870 30,100,770 8,382,996 6,560,951 -53,787 27,952,373 93,013,173 1,143,753 94,156,926

| notes to the consolidated financial statements in accordance with IFRS |
28.2 Notes to the financial statements of the Sava
Group in accordance with International Financial
Reporting Standards
1 4 7 |
SIGNIFICANT ACCOUNTING POLICIES FOR THE SAVA GROUP
1. Significant accounting policies
Sava d.d. is a company domiciled in the Republic of
Slovenia. The consolidated financial statements of the
Sava Group for the year ended 31 December 2005
comprise the Sava Group that include the parent
company Sava d.d. and its subsidiaries (together
referred to as the Sava Group) and the Group's interest
in jointly controlled entities.
The financial statements were authorised for issue by
the Board of Management on 28 March 2006.
a) Statement of compliance
The consolidated financial statements have been
prepared in accordance with International Financial
Reporting Standards (IFRSs) and its interpretations
adopted by the International Accounting Standards
Board (IASB). These are the Group’s first consolidated
financial statements and IFRS 1 has been applied.
An explanation of how the transition to IFRSs has
affected the reported financial position, financial
performance and cash flows of the Group is provided
under item 34 of the notes.
The following new Standards are not yet effective and
have not been applied in preparing these financial
statements of the Sava Group for the year 2005:
• IFRS 6 Exploration for and Evaluation of Mineral
Resources (effective from 1 January 2006 - The Group
does not have any operations that would be affected by
the new Standard.
• IFRS 7 Financial Instruments: Disclosures (effective
from 1 January 2007) – The Standard will require
increased disclosure in respect of the Group's financial
instruments. The Group considers that the significant
additional disclosures required will relate to its
financial risk management objectives, policies and
processes.
• Amendment to IFRS 1 First-time Adoption of
International Financial Reporting Standards and IFRS
6 Exploration for and Evaluation of Mineral
Resources (effective from January 2006) - The Group
does not have any operations that would be affected by
the new amendment.
• Amendment to IAS 1 Presentation of Financial
Statements – Capital Disclosures (effective from 1
January 2007) – This amendment will require
significantly more disclosures regarding the capital
structure.
• Amendment to IAS 19 Employee Benefits – Actuarial
Gains ald Losses (effective from 1 January 2006) – The
amendment includes an option for actuarial gains and
losses to be recognised in full as they arise, outside of the
income statement in a statement of recognised income
and expense. Presently the Sava Group recognises
actuarial gains and losses in full in the income statement
and intends to do the same in the future.
• Amendment to IAS 39 Financial Instruments:
Recognition and Measurement – Cash Flow Hedge
Accounting of Forecast Intragroup Transactions
(effective from 1 January 2006) – The amendment
allows the foreign currency risk of a highly probable
forecast intragroup transaction to qualify as hedged
item if certain criteria are met. In the Sava Group only
the consolidated financial statements have been
prepared according to IFRSs.

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• Amendment to IAS 39 Financial Instruments:
Recognition and Measurements – The Fair Value
Option (effective from 1 January 2006) – The
amendment restricts the designation of financial
instruments as »at fair value through profit or loss«.
The Sava Group does not have any financial
instruments that would be classified as financial
instruments at fair value.
• Amendment to IAS 39 Financial Instruments:
Recognition and measurement and IFRS 4 Insurance
Contracts – Financial Guarantee Contracts (effective
from 1 January 2006): The amendment requires
guarantees that are not insurance contracts to be
measured at fair value upon initial recognition. The
company considers insurances and guarantees hired by
companies in the Group as insurance contracts and
accounts for them as contingent liabilities. Guarantees
for loans are issued by the parent company for loans
hired by subsidiaries. Therefore from the aspect of the
Sava Group there are no contingent liabilities, since all
liabilities of subsidiaries are presented in the
consolidated financial statements.
• Amendment to IAS 21 The Effects of Changes in
Foreign Exchange Rates – Net Investment in a Foreign
Operation (effective from 1 January 2006) – The
Group currently has no items comprising net
investments in foreign operations that will be affected
by the amendment.
• IFRIC 4 Determining whether an Arrangement
contains a Lease (effective from 1 January 2006) –
The interpretation requires certain arrangements to be
accounted for as a lease in accordance with IAS 17
Leases even if they are not in legal form of a lease. The
Group has no such agreements made that would
require dealing with according to this interpretation.
• IFRIC 5 Rights to Interests arising from Decommissioning,
Restoration and Environmental Rehabilitation
Funds (effective from 1 January 2006) - The
interpretation deals with funds created for the purpose of
settling decommissioning and similar expenses. IFRIC 5
is not relevant to the Group's operations.
• IFRIC 6 Liabilities arising from Participating in a
Specific Market – Waste Electrical and Electronic
Equipment (effective from 1 December 2005) – The
interpretation deals with obligations arising from the
European Union Directive regulating the collection,
treatment, recovery and environmentally sound
disposal of waste equipment. IFRIC 6 is not relevant
to the Group's operations.
• IFRIC 7 Applying the Restatement Approach under
IAS 29 Financial Reporting in Hyperinflationary
Economies (effective from 1 March 2006) – The
interpretation contains guidance on how an entity
would restate its financial statements pursuant to IAS
29 in the first year it identifies the existence of
hyperinflation in the economy of its functional
currency. IFRIC 7 is not relevant to the Group's
operations, since they do not operate in hyperinflation.
• IFRIC 8 Scope of IFRS 2 (effective from 1 May 2006)
– The interpretation clarifies that the accounting
standard IFRS 2 Shareholders Payment applies to
arrangements where an entity makes share-based
payments for apparently nil or inadequate
consideration. IFRIC 8 is not relevant to the Group's
operations, since there are no such payments.
• IFRIC 9 Reassessment of Embedded Derivatives
(effective from 1 June 2006) – The interpretation
clarifies that the treatment of an embedded derivative
is assessed by the entity when the entity first becomes
a party to the contract, and that reassessement is
prohibited unless there is a change in the terms of the
contract that significantly modifies the cash flows that
otherwise would be required under the contract. IFRIC
9 is not relevant to the Group's operations since it does
not have any embedded derivatives.
* Explanation to the applied abbreviations:
IAS – International Accounting Standard
IFRS – International Financial Reporting Standards
IFRIC - International Financial Reporting
Interpretations Committee

| notes to the consolidated financial statements in accordance with IFRS |
1 4 9 |
b) Basis of preparation
The financial statements are presented in Slovene tolars,
rounded to the nearest thousand.
They are prepared on the historical cost basis except
property, plant and equipment that are stated at their
carrying amount on the date of transition to IFRS and
financial instruments classified as available for sale that
are stated at their fair value.
Cost of property, plant and equipment on the day of
transition to IFRS is considered the fair value of these
assets. In past the carrying amount of property, plant and
equipment was stated at cost which until 2001 had been
enhanced by annual price indices and impaired on the
basis of individual value assessments according to IAS 36.
The preparation of financial statements in conformity
with IFRSs requires management to make judgements,
estimates and assumptions that affect the application of
policies and reported amounts of assets and liabilities,
income and expenses. The estimates and associated
assumptions are based on historical experience and
various other factors that are believed to be reasonable
under the circumstances, the results of which form the
basis of making the judgements about carrying values of
assets and liabilities that are not readily apparent from
other sources. Actual results may differ from these
estimates.
The estimates and underlying assumptions are reviewed
on an ongoing basis. Revisions to accounting estimates
are recognised in the period in which the estimate is
revised if the revision affects only that period, or in the
period of the revision and future periods if the revision
affects both current and future periods.
The accounting policies set out below have been applied
consistently to all periods presented in these
consolidated financial statements and in preparing an
opening IFRS balance sheet at 1 January 2004 for the
purposes of the transition to IFRSs.
The accounting policies have been applied consistently
by Sava Group entities.
c) Basis of consolidation
The Sava Group includes the parent company Sava d.d.,
32 subsidiaries, 3 jointly controlled entities. The
consolidated financial statements of the Group include
the financial statements of all these entities. A detailed
survey of the Group and changes is presented in the
Annual Report under chapter 2 Composition of the Sava
Group.
Subsidiaries
Subsidiaries are entities controlled by Sava d.d. Control
exists when the parent company has the power to govern
the financial and operating policies of an entity so as to
obtain benefits from its activities. In all subsidiaries the
capital and voting rights are in accord.
The financial statements of subsidiaries are included in
the consolidated financial statements from the date that
control commences until the date that control ceases.
Joint ventures
Joint ventures are those entities over whose activities the
Group has joint control, established by contractual
agreement between the Group and the contractual
partner. The consolidated financial statements include
the Group’s proportionate share of the entities’ assets,
liabilities, revenue and expenses with items of a similar
nature on a line by line basis, from the date that joint
control commences until the date that joint control
ceases.
Associates
Associates are those entities in which the Sava Group
has significant influence, but not control, over the
financial and operating policies. The consolidated
financial statements include the Sava Group’s share of
the total recognised gains and losses of associates on an
equity accounted basis, from the date that significant
influence commences until the date that significant
influence ceases. When the Group’s share of losses
exceeds its interest in an associate, the Group’s carrying
amount is reduced to nil and recognition of further
losses is discontinued except to the extent that the Group
has incurred legal or constructive obligations or made
payments on behalf of an associate.

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The capital and voting rights in associates are in accord
except with Gorenjska Banka where the Sava Group on
31/12/2005 had voting rights in the amount of 41.1%,
whereas the statute limits the voting right of a
stakeholder to a maximum of 33%.
Transaction eliminated on consolidation
Intragroup balances and any unrealised gains and losses
or income and expenses arising from intragroup
transactions, are eliminated in preparing the
consolidated financial statements.
Unrealised gains arising from transactions with
associates are eliminated to the extent of the Group’s
interest in the entity. Unrealised losses are eliminated in
the same way as unrealised gains, but only to the extent
that there is no evidence of impairment.
d) Foreign currency
Foreign currency transactions
Transactions in foreign currencies are translated at the
mean exchange rate of the Bank of Slovenia ruling at the
date of the transaction.
Monetary assets and liabilities denominated in foreign
currencies at the balance sheet date are translated to
Slovene tolar at the mean exchange rate of the Bank of
Slovenia ruling at that date. Foreign exchange
differences arising on translation are recognised in the
income statement.
Non-monetary assets and liabilities denominated in
foreign currencies that are stated at fair value are
translated to Slovene tolar at the mean exchange rate of
the Bank of Slovenia ruling at the date the fair value was
determined. Non-monetary assets and liabilities
denominated in foreign currencies that are stated at fair
value are translated to Slovene tolar at the mean
exchange rate of the Bank of Slovenia ruling at the date
the fair value was determined.
Financial statements of foreign operations
The assets and liabilities of foreign operations are
translated to Slovene tolar at the mean exchange rate of
the Bank of Slovenia ruling at the balance sheet date.
The revenues and expenses of foreign operations are
translated to tolar at rates ruling at the dates of the
transactions. Foreign exchange differences arising on
retranslation are recognised directly in a separate
component of equity.
e) Derivative financial instruments
The Group does not use derivative financial instruments
to hedge its exposure to foreign exchange and interest
rate risks arising from operational, financing and
investment activities. Moreover, the Group does not
hold or issue derivative financial instruments for trading
purposes.
f) Property, plant and equipment
Owned assets
Items of property, plant and equipment are stated at cost
as deemed cost less accumulated depreciation (see
below) and impairment losses (see accounting policy
under Impairment of Assets – note l). The cost of selfconstructed
assets includes the cost of materials, direct
labour and indirect production overheads.
Certain items of property, plant and equipment that had
been revalued to fair value on 1 January 2004, or prior
to the date of transition to IFRSs, are measured on the
basis of deemed cost, being the revalued amount at the
date of that revaluation.
The useful lives are as follows:
Manufacturing buildings 25 – 80 years
Hotel, trading buildings, warehouses 20 – 71 years
Office buildings 25 – 40 years
Manufacturing equipment in rubber manufacturing 4 – 20 years
Hotel furnishings 5 – 20 years
Equipment in stores 4 – 10 years
Computer equipment 2 – 5 years
Other equipment 6 – 20 years

| notes to the consolidated financial statements in accordance with IFRS |
1 5 1 |
Property that is being constructed or developed for
future use as investment property is classified as
property, and stated at cost until construction or
development is complete, at which time it is reclassified
as investment property.
Where parts of an item of property, plant and equipment
have different useful lives, they are accounted for as
separate items of property, plant and equipment.
Subsequent costs
The Sava Group recognises in the carrying amount of an
item of property, plant and equipment the cost of
replacing part of such an item when that cost is incurred
if it is probable that the future economic benefits
embodied with the item will flow to the Sava Group and
the cost of the item can be measured reliably. All other
costs are recognised in the income statement as an
expense as incurred.
Depreciation
Depreciation is charged to the income statement on a
straight-line basis over the estimated useful lives of each
part of an item of property, plant and equipment. Land
is not depreciated.
g) Intangible assets
Goodwill
All business combinations are accounted for by
applying the purchase method. In respect of associates,
the carrying amount of goodwill is included in the
carrying amount of the investment in the associate.
Negative goodwill arising on an acquisition is
recognised directly in profit or loss.
Other intangible assets
Other intangible assets that are acquired by the Sava
Group are stated at cost less accumulated amortisation
and impairment losses (see accounting policy
Impairment of Assets – note l).
Expenditure on internally generated goodwill and
brands is recognised in the income statement as an
expense as incurred.
Subsequent expenditure
Subsequent expenditure on capitalised intangible assets
is capitalised only when it increases the future economic
benefits embodied in the specific asset to which it
relates. All other expenditure is expensed as incurred.
Amortisation
Amortisation is charged to the income statement on a
straight-line basis over the estimated useful lives of
intangible assets unless such lives are indefinite.
Intangible assets are amortised from the date they are
available for use. The estimated useful lives for software
and other patents and licence are five years.
h) Investments
Investments in debt and equity securities
As regards the intent of its acquisition investments in
debt and equity securities are classified as available for
sale. These financial instruments are recognised or
derecognised by the Group on the date it commits to
purchase / sell the investments. The securities available
for sale are equity securities of companies that either are
or are not listed at the Stock Exchange.
The investments in shares are stated at fair value. Profit
or loss are recognised directly in equity. When these
investments are derecognised, the cumulative gain or
loss previously recognised directly in equity is
recognised in profit or loss for the period.
The fair value of financial instruments classified as
available for sale is their quoted bid price at the balance
sheet date. The fair value of shares and interests of a
company that is not listed is estimated on the basis of
recently known transactions. The fair value of availablefor-sale
securities is ascertained every three months.
Investment property
Investment properties are properties which are held
either to earn rental income or for capital appreciation or
for both. For evaluating investment properties the cost
model is applied.
Depreciation is charged to the income statement on a
straight-line basis over the estimated useful lives of each
part of an item of property, plant and equipment. Land
is not depreciated. The estimated useful lives for
investment property are 20 – 30 years.

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For the need of disclosing the fair value of investment
property is established. The fair value is based on
market values, being the estimated amount for which a
property could be exchanged on the date of valuation
between a willing buyer and a willing seller in an arm’s
length transaction after proper marketing wherein the
parties had each acted knowledgeably, prudently and
without compulsion. As a rule, the portfolio is being
appraised by an independent and certified valuator.
When an investment property becomes owner-occupied,
it is reclassified as property, fixtures and fittings.
Lease payments are accounted for as described in
accounting policy "Revenue" and "Expenses" under q)
and r).
i) Trade and other receivables
Construction work in progress
Construction work in progress is stated at cost plus
profit recognised to date (see accounting policy
Revenue under q) less a provision for foreseeable losses
and less progress billings. Cost includes all expenditure
related directly to specific projects and an allocation of
fixed and variable overheads incurred in the Group’s
contract activities based on normal operating capacity.
Other trade and other receivables
Trade and other receivables are stated at their cost less
impairment losses (see accounting policy Impairment of
Assets under l).
j) Inventories
Inventories are stated at the lower of cost and net
realisable value. Net realisable value is the estimated
selling price in the ordinary course of business, less the
estimated costs of completion and selling expenses.
The cost of other inventories includes expenditure
incurred in acquiring the inventories and bringing them
to their existing location and condition. In the case of
manufactured inventories and work in progress, cost
includes an appropriate share of overheads based on
normal operating capacity. The use of inventories is
stated at weighted average prices.
k) Cash and cash equivalents
Cash and cash equivalents comprise cash balances and
call deposits or deposits at up to three months’ notice.
l) Impairment of assets
The carrying amounts of the Group’s assets, other than
current and deferred tax assets (see accounting policy
w), are reviewed at each balance sheet date to determine
whether there is any indication of impairment. If any
such indication exists, the asset’s recoverable amount is
estimated.
An impairment loss of an asset is recognised whenever
the carrying amount of an asset or its cash-generating
unit exceeds its recoverable amount. Impairment losses
are recognised in the income statement.
When a decline in the fair value of an available-for-sale
financial asset has been recognised directly in equity
and there is objective evidence that the asset is impaired,
the cumulative loss that had been recognised directly in
equity is recognised in profit or loss even though the
financial asset has not been derecognised. The amount
of the cumulative loss that is recognised in profit or loss
is the difference between the acquisition cost and
current fair value, less any impairment loss on that
financial asset previously recognised in profit or loss.
Calculation of recoverable amount
The recoverable amount of the Group’s investments in
receivables carried at amortised cost is calculated as the
present value of estimated future cash flows, discounted
at the original effective interest rate (i.e., the effective
interest rate computed at initial recognition of these
financial assets). Receivables with a short duration are
not discounted.
The recoverable amount of other assets is the greater of
their net selling price and value in use. In assessing
value in use, the estimated future cash flows are
discounted to their present value using a pre-tax
discount rate that reflects current market assessments of
the time value of money and the risks specific to the
asset. For an asset that does not generate largely
independent cash inflows, the recoverable amount is
determined for the cash-generating unit to which the
asset belongs.

| notes to the consolidated financial statements in accordance with IFRS |
1 5 3 |
Reversals of impairment
An impairment loss in respect of an investment in an
equity instrument classified as available for sale is not
reversed through profit or loss. If the fair value of a debt
instrument classified as available for sale increases and
the increase can be objectively related to an event
occurring after the impairment loss was recognised in
profit or loss, the impairment loss shall be reversed, with
the amount of the reversal recognised in profit or loss.
In respect of other assets, an impairment loss is reversed
if there has been a change in the estimates used to
determine the recoverable amount.
An impairment loss is reversed only to the extent that
the asset’s carrying amount does not exceed the carrying
amount that would have been determined, net of
depreciation or amortisation, if no impairment loss had
been recognised.
m) Share capital
Repurchase of share capital
When share capital recognised as equity is repurchased,
the amount of the consideration paid, including directly
attributable costs, is recognised as a change in equity.
Repurchased shares are classified as treasury shares and
presented as a deduction from total equity.
Dividends
Dividends are recognised as a liability in the period in
which they are declared.
n) Interest-bearing borrowings
Interest-bearing borrowings are recognised initially at
fair value less attributable transaction costs. Subsequent
to initial recognition, interest-bearing borrowings are
stated at amortised cost with any difference between
cost and redemption value being recognised in the
income statement over the period of the borrowings on
an effective interest basis.
o) Provisions
A provision is recognised in the balance sheet when the
Group has a present legal or constructive obligation as a
result of a past event, and it is probable that an outflow
of economic benefits will be required to settle the
obligation. If the effect is material, provisions are
determined by discounting the expected future cash
flows at a pre-tax rate that reflects current market
assessments of the time value of money and, where
appropriate, the risks specific to the liability.
Provisions for severance and employee jubilee benefits
The company pays contributions for health insurance,
pension and social insurance fund from gross salaries
during the year at statutory defined rates. Contributions
are recognised as an expense in the income statement as
incurred.
As stipulated by the legislation, collective agreement
and internal regulations the Group is committed to pay
employee jubilee benefits and severance upon their
retirement, for which long-term provisions are formed.
No other liabilities due to pension exist.
Provisions are formed in the amount of benefit that
employees have earned in return for their service in the
current and prior periods, discounted at the balance
sheet date. The calculation for every employee
considers expense for severance upon retirement and all
expected jubilee benefits until their retirement. The
chosen discount interest rate is 2.75% annually and
represents the real interest rate. The calculation is
performed by a qualified actuary using the projected
unit method.
Warranties
A provision for warranties is recognised when the
underlying products or services are sold. The provision
is based on historical warranty data and a weighting of
all possible outcomes against their associated
probabilities.
Restructuring
A provision for restructuring is recognised when the
Group has approved a detailed and formal restructuring
plan, and the restructuring has either commenced or has
been announced publicly. Future operating costs are not
provided for.
p) Trade and other payables
Trade and other payables are stated at cost.

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q) Revenue
Goods sold and services rendered
Revenue from the sale of goods is recognised in the
income statement when the significant risks and rewards
of ownership have been transferred to the buyer.
Revenue from services rendered is recognised in the
income statement as services are rendered.
No revenue is recognised if there are significant
uncertainties regarding recovery of the consideration
due, associated costs or the possible return of goods also
continuing management involvement with the goods.
Construction contracts
As soon as the outcome of a construction contract can be
estimated reliably, contract revenue and expenses are
recognised in the income statement in proportion to the
stage of completion of the contract. The stage of
completion is assessed by reference to surveys of work
performed. An expected loss on a contract is recognised
immediately as incurred.
Rental income
Rental income from investment property is recognised
in the income statement on a straight-line basis over the
term of the lease.
Government grants
Government grant is recognised in the balance sheet
initially as deferred income when there is reasonable
assurance that it will be received and that the Group will
comply with the conditions attaching to it.
Grants that compensate the Group for expenses incurred
are recognised as revenue in the income statement on a
systematic basis in the same periods in which the
expenses are incurred. Grants that compensate the
Group for the cost of an asset are recognised in the
income statement as other operating income on a
systematic basis over the useful life of the asset.
r) Expenses
Operating lease payments
Payments made under operating leases are recognised in
the income statement on a straight-line basis over the
term of the lease.
Net financing costs
Net financing costs comprise interest payable on
borrowings calculated using the effective interest rate
method, interest receivable on funds invested, dividend
income, foreign exchange gains and losses, and gains
and losses from sale of securities.
Interest income is recognised in the income statement as
it accrues, using the effective interest rate method.
Dividend income is recognised in the income statement
on the date the entity’s right to receive payments is
established.
The interest expense component of finance lease
payments is recognised in the income statement using
the effective interest rate method.
s) Income tax
Income tax on the profit or loss for the year comprises
current and deferred tax. Income tax is recognised in the
income statement except to the extent that it relates to
items recognised directly in equity, in which case it is
recognised in equity.
Current tax is the expected tax payable on the taxable
income for the year, using tax rates enacted or
substantially enacted at the balance sheet date, and any
adjustment to tax payable in respect of previous years.
Deferred tax is provided using the balance sheet liability
method, providing for temporary differences between
the carrying amounts of assets and liabilities for
financial reporting purposes and the amounts used for
taxation purposes. The amount of deferred tax provided
is based on the expected manner of realisation or
settlement of the carrying amount of assets and
liabilities, using tax rates enacted or substantively
enacted at the balance sheet date.
A deferred tax asset is recognised only to the extent that
it is probable that future taxable profits will be available
against which the asset can be utilised. Deferred tax
assets are reduced to the extent that it is no longer
probable that the related tax benefit will be realised.
t) Segment reporting
A segment is a distinguishable component of the Group
that is engaged either in providing products or services

| notes to the consolidated financial statements in accordance with IFRS |
1 5 5 |
(business segment), or in providing products or services
within a particular economic environment (geographical
segment), which is subject to risks and rewards that are
different from those of other segments.
The Sava Group’s operations are divided in six divisions
and the operation Other companies which are defined as
business segments such as Rubber Manufacturing with
the foreign trade network, Chemicals, Trade, Tourism,
Real Estate, and Investment Finance.
The Sava Group’s sales is pursued in three geographical
segments: Slovenia, export to other EU countries, other
exports.
2. Segment Information
Segment information is presented in respect of the
Group's business segments that are included in the Sava
Group's divisions.
The operation by a particular division is presented in
chapter15 of the Annual Report.
Information by business segment for the year 2005
(SIT in thousands
Rubber
Manufacturing Excluding
with foreign Other Investment operations
trade network Chemicals Trade Tourism Real Estate Companies Finance in the Group TOTAL
Net sales revenues
from goods sold
Net sales revenues from
20,412,014 1,289,750 0 0 3,315,939 0 0 -4,782,659 20,235,044
services rendered
Net revenues
787,265 0 0 12,990,102 0 54,462 1,905,903 -2,808,863 12,928,869
from rents
Net sales revenues
from merchandise
0 0 4,234 52,978 221,652 0 0 0 278,864
sold
Change in
1,582,187 0 23,436,879 0 0 0 0 0 25,019,066
inventories
Other operating
281,916 -51,153 0 0 736,267 0 0 0 967,030
revenues
Total
76,092 94,228 527,969 289,004 169,270 1,338 414,567 444,385 2,016,853
operating revenues 23,139,474 1,332,825 23,969,082 13,332,084 4,443,128 55,800 2,320,470 -7,147,137 61,445,726
Net profit for
the year 342,828 -63,895 532,116 107,912 174,329 -150,358 4,497,567 3,775,074 9,215,573
Assets 11,254,902 645,161 14,639,445 43,441,505 12,203,081 66,328 119,500,693 -45,744,814 156,006,301
Liabilities 6,148,370 382,038 8,202,423 17,974,619 9,544,872 134,116 31,686,614 -12,223,677 61,849,375
Purchase of property,
plant and equipment 1,096,538 9,343 101,101 4,904,831 158,599 479 2,747,213 0 9,018,105
Depreciation 541,731 27,311 283,539 1,892,918 177,086 14,714 660,651 0 3,597,950

a n n u a l r e p o r t | 2 0 0 5
1 5 6 |
By the acquisition of companies operating under the
Pannonian Spas brand in 2004 negative goodwill in the
amount of 3,467,619,000 tolars was produced, which
consistent with International Financial Reporting
Standards was included in the income of the Group for
the year 2004. Thus the profit of the Group in 2004 was
affected by negative goodwill at 29.8 per cent.
Information by business segment for the year 2004
(SIT in thousands)
Rubber
Manufacturing Excluding
with foreign Other Investment operations
trade network Chemicals Trade Tourism Real Estate Companies Finance in the Group TOTAL
Net sales revenues
from goods sold 17,539,776 1,474,761 0 0 3,611,792 0 0 -3,372,770 19,253,559
Net sales revenues from
services rendered 1,104,615 0 0 12,616,313 0 3,661 1,857,083 -3,383,599 12,198,073
Net revenues
from rents 0 0 2,142 56,791 198,322 0 0 0 257,255
Net sales revenues
from merchandise
sold 1,304,328 0 23,372,569 0 0 0 0 0 24,676,897
Change in
inventories 73,520 34,330 0 0 81,576 0 0 -446 188,980
Other operating
revenues 75,339 128,835 224,664 186,005 94,883 0 222,040 3,706,250 4,638,016
Total operating revenues 20,097,578 1,637,926 23,599,375 12,859,109 3,986,573 3,661 2,079,123 -3,050,565 61,212,780
Net profit for
the year 248,125 -194,756 345,194 687,279 196,885 -46,098 3,358,316 7,056,504 11,651,449
Assets 9,348,197 969,579 15,135,658 40,697,445 10,961,368 85,787 106,159,519 -41,168,816 142,188,737
Liabilities 4,506,325 642,562 9,216,579 15,132,864 8,484,738 31,886 22,687,515 -9,067,043 51,635,425
Purchase of property,
plant and equipment 609,160 22,320 85,440 5,951,320 199,960 0 2,021,967 0 8,890,167
Depreciation 520,409 46,120 172,291 1,301,197 173,739 5,980 660,637 0 2,880,373

| notes to the consolidated financial statements in accordance with IFRS |
1 5 7 |
Acquisitions in 2004 and 2005
(SIT in thousands)
Company Payment
equity on for
Acquisition acquisition Acquired Purchased acquired Negative
Company date date stake equity stake goodwill
YEAR 2004:
Terme 3000 d.d. - consolidated 01/01/2004 9,677,020 96.65% 9,352,840 7,643,939 -1,708,901
Terme Radenci d.o.o. 01/01/2004 6,220,557 96.65% 6,012,168 4,250,000 -1,762,168
Other Additional purchases 73,509 76,959 3,450
Total -3,467,619
YEAR 2005:
Information by geographical segment
Consolidated net sales revenues by geographical segment
Slovenia EU Other
(SIT in thousands)
Total
2005 40,504,253 9,949,221 8,008,369 58,461,843
2004 40,335,413 8,911,915 7,138,456 56,385,784
The assets are not segmented due to the fact that the
carrying amount of the assets relating to the companies
3. Acquisition and sale of stakes
in subsidiaries
In 2005 only purchases of ownership stakes were carried
out, while in 2004 stakes in companies operating under
in Slovenia represents 99.1 per cent of the total assets of
the Group (in 2004: 98.9%).
the Pannonian Spas brand were bought and a stake in the
company Color d.d. was sold.
GOLF IN KAMP d.d. Bled Additional purchases 1,413,963 0.02% 283 79 -204
Grand Hotel Toplice Bled d.o.o., Bled Additional purchases 200,201 0.48% 961 1,834 873
G&P Hoteli Bled d.o.o., Bled Additional purchases 6,052,451 7.70% 466,039 219,723 -246,316
TERME 3000 d.d., Moravske Toplice Additional purchases 10,122,084 0.42% 42,513 28,651 -13,862
Teol d.d. Additional purchases 287,032 1.40% 4,018 0 -4,018
Sava Trade d.d. Additional purchases 7,162,809 1.41% 100,996 43,398 -57,598
Other Additional purchases -11,381 0 11,381
Total -309,743

a n n u a l r e p o r t | 2 0 0 5
YEAR 2004:
YEAR 2004:
1 5 8 |
Sale of stakes in companies
(SIT in thousands)
Company equity Sold part Purchase money
Date of sale on date of sale Sold stake of equity for a sold stake Difference
Color d.d. 01/01/2004 4,351,677 84.70% 3,685,870 3,729,463 43,593
YEAR 2004:
Disclosures of assets and liabilities in acquired companies
(SIT in thousands)
Property, plant Intangible Other
and equipment aseets assets Liabilities
Terme 3000 d.d. - consolidated 14,407,702 92,748 603,224 4,999,416
Terme Radenci d.o.o. 7,708,223 4,068 339,076 1,830,810
Disclosures of assets and liabilities in sold companies
(SIT in thousands)
Property, plant Intangible Other
and equipment assets assets Equity Liabilities
Color d.d. 3,694,934 307,982 5,550,776 4,351,677 5,202,015
Income statement
4. Joint ventures
3companies are included in the Sava Group, in which
the parent company has a 50 per cent stake: Sava
Schäfer, d.o.o., Kranj, PC AG, d.o.o. Velenje and Sava
IMG, d.o.o., Poreå. In consolidating we have applied the
proportionate consolidation method and we present
below the appropriate portion of assets, liabilities,
revenues and expenses.
(2005 - SIT in thousands)
Net sales revenues from goods sold and services rendered 408,996
Other operating revenues -1,076
Cost of goods materials and services -236,240
Labour costs -110,370
Other operating expenses -14,325
Tax -10,085
Net profit for the year 36,900

| notes to the consolidated financial statements in accordance with IFRS |
Balance sheet
1 5 9 |
(2005 - SIT in thousands)
Property, plant and equipment 88,692
Non-current receivables 742
Inventories 21,875
Operating and other receivables 70,554
Interest-bearing borrowings -36,615
Cash and cash equivalents 1,393
Assets 146,641
Minority interest 133,914
Interest-bearing borrowings 11,021
Non-current operating liabilities 862
Current loans 5,806
Current operating liabilities -4,962
Equity and liabilities 146,641
5. Other operating revenues
(SIT in thousands)
OTHER OPERATING REVENUES 2005 2004
Reversal of provisions not used 186,701 126,623
Revenues from government incentives 59,521 110,840
Net proceeds from sale of property, plant and equipment 1,050,978 572,367
Realised negative goodwill in purchase of subsidiaries 309,743 3,467,619
Other 409,910 360,567
Total 2,016,853 4,638,016
Other items mainly comprise the collection of written-off receivables and reversal of other non-current provisions.

a n n u a l r e p o r t | 2 0 0 5
1 6 0 |
6. Labour costs
(SIT in thousands)
LABOUR COSTS 2005 2004
Wages and salaries 9,379,542 8,635,424
Social security expense 1,673,150 1,579,994
Other labour cost 2,227,538 2,163,036
Total 13,280,230 12,378,454
Other labour cost includes paid employee holiday
allowance, other compensations in accordance with the
collective agreement (meals and commuting to and from
work) and provisions for severance pay and employee
7. Impairment losses and write-offs
IMPAIRMENT LOSSES AND WRITE-OFFS 2005
(SIT in thousands)
2004
Impairment of property, plant and equipment 0 728,883
Write-offs of property, plant and equipment 42,382 235,959
Write-offs of investment property 7,171 0
Write-offs of intangible assets 51,431 21,999
Inventories 98,282 144,194
Receivables 177,072 324,928
Total 376,338 1,455,963
8. Other operating expenses
(SIT in thousands)
OTHER OPERATING EXPENSES 2005 2004
Other operating expenses 521,204 636,663
Other operating expenses mainly consist of contributions
for a building plot and formation of non-current
jubilee benefits accounted on the basis of actuary
calculation.
3,062 employees were employed in 2005, while in 2004
the employee number totalled 3,014.
provisions. They do not represent a significant share in
the operating expenses structure.
(SIT in thousands)
OTHER INFORMATION ABOUT EXPENSES 2005 2004
Research and development costs 1,921 4,989
Restructuring costs 4,252 2,126
Direct operating expenses for investment property 131,922 131,459
Rent-generating 106,966 102,724
Revenue non-generating 24,956 28,735

| notes to the consolidated financial statements in accordance with IFRS |
9. Net financing income
NET FINANCING INCOME 2005
(SIT in thousands)
2004
Net gain on disposal of equity securities 4,792,718 6,122,693
Dividends and shares in income 492,590 97,613
Interest income 344,370 286,250
Net exchange gains 110,780 105,063
Others 114,085 378,353
Total financing income 5,854,543 6,989,972
Interest expenses -1,463,187 -1,460,343
Impairment of equity securities -476,294 -1,163,814
Exchange losses -41,842 -252,925
Net loss on disposal of investments -56,847 -69,305
Others -31,917 -111,067
Total financing expenses -2,070,087 -3,057,454
Net financing income 3,784,456 3,932.518
Income tax expense recognised in the income statement:
INCOME TAX EXPENSES 2005
(SIT in thousands)
2004
Income tax expenses recognised in the income statement:
Assessed tax in the current year
- for the current year -1,312,485 -865,737
- adjustment for previous years 0 0
Total -1,312,485 -865,737
DEFERRED TAX
- recently arisen and withdrawn temporary differences 60,146 5,033
- effect by applied tax losses 0 0
Total 60,146 5,033
Tax to the credit/debit of the income statement -1,252,339 -860,704
1 6 1 |
10. Share of profit in associates
Income from share of profit in associates refers to
Gorenjska Banka d.d. Kranj and was realised in the
amount of 4,692,039,000 tolars, which is 20.5 per cent
more than last year. The amount of 1,361,350,000 tolars
11. Income tax expenses
was paid as dividends, the remaining 3,330,689,000
tolars, or 79.5 per cent, are due to the rest of the
attributable profit of Gorenjska Banka d.d. for 2005
considering the equity method.

a n n u a l r e p o r t | 2 0 0 5
1 6 2 |
Comparison between the actual and calculated tax rate
Deferred tax, recognised directly in equity
A deferred tax liability due to the revaluation of
(SIT in thousands)
2005 2004
rate value rate value
Pre-tax profit in accordance with IFRSs 10,467,912 12,512,153
Income tax by applying the official rate 25.0% 2,616,978 25.0% 3,128,038
Tax rate effect in foreign operations 0.2% 24,470 0.0% -219
Tax non-deductible expenses 3.1% 322,774 2.0% 250,920
Tax free revenues -11.4% -1,198,204 -14.5% -1,819,123
Tax benefits not recognised in the income statement -4.5% -476,466 -4.7% -591,085
Effect by companies operating with a loss 2.0% 204,579 0.4% 54,939
Consolidation bookings -2.3% -241,792 -1.3% -162,766
Effective tax rate 12.0% 1,252,339 6.9% 860,704
available-for-sale securities to a fair value decreased a
fair value reserve.
(SIT in thousands)
2005 2004
Revaluation of available-for-sale securities -1,215,137 1,633,474

| notes to the consolidated financial statements in accordance with IFRS |
COST
1 6 3 |
12. Property, plant and equipment
Movement of property, plant and equipment in the Sava Group in 2005
(SIT in thousands)
Plant and Other PPE under
Land Buildings machinery equipment construction Total
Balance at 31/12/2004 8,873,501 63,734,711 13,776,487 9,627,815 2,499,172 98,511,686
Purchase 1,079,266 0 0 0 7,938,839 9,018,105
Capitalisation 299,902 2,159,674 2,149,575 237,898 -4,847,049 0
Transfers 0 0 19,277 -19,277 0 0
Disposals -402,366 -1,532,914 -78,324 -1,584,974 0 -3,598,578
Write-offs 0 -905 -10,127 -45,024 0 -56,056
Balance at 31/12/2005 9,850,303 64,360,566 15,856,888 8,216,438 5,590,962 103,875,157
ACCUMULATED DEPRECIATION
Balance at 31/12/2004 - 27,111,886 7,971,568 6,007,405 0 41,090,859
Disposals - -563,459 -731,068 -810,711 0 -2,105,238
Write-offs - -2,591 -4,177 -6,906 0 -13,674
Depreciation - 1,583,006 1,248,549 570,557 0 3,402,112
Balance at 31/12/2005 - 28,128,842 8,484,872 5,760,345 0 42,374,059
CARRYING AMOUNT
Balance at 31/12/2004 8,873,501 36,622,825 5,804,919 3,620,410 2,499,172 57,420,827
Balance at 31/12/2005 9,850,303 36,231,724 7,372,016 2,456,093 5,590,962 61,501,098

a n n u a l r e p o r t | 2 0 0 5
COST
1 6 4 |
Movement of property, plant and equipment in the Sava Group in 2004
Plant and Other
(SIT in thousands)
PPE under
Land Buildings machinery equipment construction Total
Balance at 01/01/2004 7,271,312 37,818,653 25,994,948 6,120,842 907,767 78,113,522
Purchase 263,127 4,290,889 211,355 911,818 3,212,978 8,890,167
Capitalisation 0 0 1,810,819 0 -1,810,819 0
Additions (increases) by acquisitions 2,715,014 29,187,988 0 5,689,106 201,420 37,793,528
Disposals -497,790 -2,661,288 -7,550,874 -2,092,100 0 -12,802,052
Decreases due to company disposals -623,166 -4,363,116 -4,077,688 -966,493 -12,174 -10,042,637
Write-offs 0 0 -2,595,549 0 0 -2,595,549
Impairment -254,996 -538,415 -16,524 -35,358 0 -845,293
Balance at 31/12/2004 8,873,501 63,734,711 13,776,487 9,627,815 2,499,172 98,511,686
ACCUMULATED DEPRECIATION
Balance at 31/12/2004 - 18,083,597 20,236,032 4,041,509 0 42,361,138
Additions (increases) by acquisitions - 11,995,289 0 3,682,314 0 15,677,603
Disposals - -1,994,288 -7,096,258 -1,736,193 0 -10,826,739
Decreases due to company disposals - -1,951,034 -3,763,643 -633,026 0 -6,347,703
Write-offs - 0 -2,359,590 0 0 -2,359,590
Impairment - -118,307 -6,070 7,967 0 -116,410
Depreciation - 1,096,629 961,097 644,834 0 2,702,560
Balance at 31/12/2004 - 27,111,886 7,971,568 6,007,405 0 41,090,859
CARRYING AMOUNT
Balance at 01/01/2004 7,271,312 19,735,056 5,758,916 2,079,333 907,767 35,752,384
Balance at 31/12/2004 8,873,501 36,622,825 5,804,919 3,620,410 2,499,172 57,420,827

| notes to the consolidated financial statements in accordance with IFRS |
Survey of mortgage values
Book value of assets under
(SIT in thousands)
Value of mortgages
SURVEY OF MORTGAGE VALUES mortgage at 31/12/2005 on real estate
Sava d.d. 965,354 670,812
Sava Trade d.d. 2,194,589 213,296
Sava IP d.o.o. 485,970 777,150
Sava IP Nova d.o.o. 1,479,792 1,153,762
Terme 3000 d.d. 8,876,901 2,565,479
Terme Radenci d.o.o. 7,048,050 2,740,335
Terme Ptuj d.o.o. 1,216,876 1,066,816
Terme Lendava d.d. 1,880,498 240,157
Golf in Kamp Bled d.d. 17,144 28,013
24,165,174 9,455,820
1 6 5 |
In the company G&P Hoteli Bled d.o.o. a mortgage is
entered in the amount of 944,322,000 tolars, but the
procedure for cancelling the mortgage is underway,
13. Intangible assets
Intangible assets totalling 284.010,000 tolars mainly include computer software.
since the loans were repaid; the total amount of
mortgages for the Sava Group does not include the
mentioned mortgage.
Movement of intangible assets in the Sava Group in 2005 and 2004
(SIT in thousands)
2005 2004
COST VALUE
At year begin 740,378 1,031,879
Additions 114,029 143,421
Acquisitions 0 173,760
Decreases -115,458 -27,738
Company disposals 0 -558,946
Write-offs -71,764 -21,999
At year end
ACCUMULATED AMORTISATION
667,188 740,378
At year beginn -390,162 -495,651
Additions 0 -3,699
Acquisitions 0 -76,944
Decreases 86,113 14,895
Company disposals 0 250,964
Write-offs 20,333 0
Amortisation -99,459 -79,727
At year end -383,175 -390,162
CARRYING AMOUNT 284,010 350,216
In the income statement the amortisation of intangible assets is included in the item depreciation and amortisation.

a n n u a l r e p o r t | 2 0 0 5
(SIT in thousands)
Land - Buildings -
investment investment
property property Total
COST VALUE
Balance at 01/01/2005 209,257 2,566,714 2,775,971
Additions 0 1,491,865 1,491,865
Disposals -60,500 -405,239 -465,739
Balance at 31/12/2005 148,757 3,653,340 3,802,097
ACCUMULATED DEPRECIATION
Balance at 01/01/2005 0 438,188 438,188
Disposals 0 -55,359 -55,359
Depreciation 0 96,372 96,372
Balance at 31/12/2005 0 479,201 479,201
CARRYING AMOUNT
Balance at 01/01/2005 209,257 2,128,526 2,337,783
Balance at 31/12/2005 148,757 3,174,139 3,322,896
1 6 6 |
14. Investment property
Investment property is mainly real estate under operating lease.
Movement of investment property in the Sava Group in 2005
Movement of investment property in the Sava Group in 2004
(SIT in thousands)
Land - Buildings -
investment investment
property property Total
COST VALUE
Balance at 01/01/2004 387,646 2,659,156 3,046,802
Additions 94,423 16,026 110,449
Disposals -272,812 -108,468 -381,280
Balance at 31/12/2004 209,257 2,566,714 2,775,971
ACCUMULATED DEPRECIATION
Balance at 01/01/2004 0 340,102 340,102
Depreciation 0 98,086 98,086
Balance at 31/12/2004 0 438,188 438,188
CARRYING AMOUNT
Balance at 01/01/2004 387,646 2,319,054 2,706,700
Balance at 31/12/2004 209,257 2,128,526 2,337,783
The fair value of investment property does not differ
considerably from the book value as the major part of
real estate under operating lease was constructed in
2003and there have not been any significant changes in
the real estate market since then.

| notes to the consolidated financial statements in accordance with IFRS |
1 6 7 |
15. Investments in associates
The Sava Group's companies have their stakes in the following associates:
(SIT in thousands)
Stake in % Stake in %
2005 2004 2005 2004
Gorenjska Banka d. d., Kranj 41.13 40.94 29,021,099 25,557,191
Limb d.o.o., Ptuj 37.50 37.50 0 71,100
Golf Istra d.o.o., Koper 20.00 20.00 11,338 28,200
Teodora d.o.o., Ljubljana 25.00 25.00 572 572
Gumtech & Co. d.o.o., Grosuplje 0 31.00 0 0
Astra, tehni@ka trgovina d.o.o., Belgrade 20.00 20.00 0 0
Turizem Lendava d.o.o. 33.00 0 700 0
Total 29,033,709 25,657,063
Movement of investments in associates:
(SIT in thousands)
2005 2004
Initial balance 25,657,063 18,788,504
Acquisitions 133,920 3,427,067
Attributable profits 4,692,039 3,895,152
Paid dividends -1,361,350 -552,960
Impairment -87,963 0
Year end balance 29,033,709 25,657,063
Important financial data about the biggest associate – Gorenjska Banka d.d., Kranj:
(SIT in thousands)
2005 2004
Assets 320,155,994 279,687,949
Liabilities and provisions 256,954,135 220,715,717
Equity 63,201,859 58,972,232
Revenues 32,676,917 25,462,522
Profit 11,407,826 9,500,370

a n n u a l r e p o r t | 2 0 0 5
(SIT in thousands)
2005 2004
Balance at 01/01 32,141,290 17,880,283
Purchase 11,858,738 12,307,705
Revaluation to fair value -4,860,547 7,074,588
Disposals -5,348,832 -4,392,639
Impairment -360,372 -728,647
Balance at 31/12 33,430,277 32,141,290
1 6 8 |
16. Non-current securities
In the Sava Group non-current securities are all
classified as available for sale. They represent a
financial potential that in the future will be invested in
accordance with the Group's business strategy. The
major part of equity securities are shares of the
companies that are listed on the Ljubljana or other stock
exchanges.
(SIT in thousands)
2005 2004
Shares of listed companies 30,801,240 25,449,885
Shares and stakes of non-listed companies 2,629,037 6,691,405
Total 33,430,277 32,141,290
Movement of equity securities available for sale:
17. Non-current receivables
(SIT in thousands)
2005 2004
Receivables due to financial leasing 2,172,467 0
Granted non-current loans 297,890 0
Other non-current financial receivables 30,940 177,649
Other non-current operating receivables 203,154 264,826
Total 2,704,451 442,475
The contract about the financial leasing of unfurnished
offices for the needs of the government bodies was
concluded for a period of 15 years. The contract interest
rate amounts to 4.296 per cent and is subject to annual
adjustment.
In 2005 financial revenues arising from financial leasing
in the amount of 38,428,000 tolars were realised. Nonearned
financial revenues arising from financial leasing
calculated at an effective interest rate totals 607,877,000
tolars.

| notes to the consolidated financial statements in accordance with IFRS |
Analysis of maturity in non-current receivables:
(SIT in thousands)
Financial
leasing Other Total
- from one to 5 years 695,116 531,984 1,227,100
- more than 5 years 1,477,351 0 1,477,351
Total 2,172,467 531,984 2,704,451
1 6 9 |
Movement of non-current receivables:
19. Trade and other receivables
(SIT in thousands)
2005 2004
Balance at 01/01 442,475 771,359
Recently formed receivables 2,431,082 0
Repayments -169,106 -328,884
Balance at 31/12 2,704,451 442,475
18. Inventories
(SIT in thousands)
2005 2004
Material 1,155,531 1,054,923
Work and projects in progress 3,769,533 3,998,201
Finished goods and merchandise 5,603,405 5,505,015
Advances for inventories 14,904 56,817
Total 10,543,373 10,614,956
In 2005 the companies of the Sava Group formed a provision in inventories in the amount of 98,282,000 tolars, while
in 2004 it totals 144,194,000 tolars.
(SIT in thousands)
2005 2004
Trade receivables 6,960,772 6,823,412
Accrued receivables 216,774 1,663,134
Receivables due from associates 10,082 393,589
Advances paid 2,118,334 758,153
Receivables for VAT and other taxes 708,874 665,673
Other receivables 2,009,937 1,156,197
Total 12,024,773 11,460,158
In 2005 the companies of the Sava Group formed a provision in trade receivables totalling 177,072,000 tolars. In
2004 the provision in trade receivables amounted to 324,928,000 tolars.

a n n u a l r e p o r t | 2 0 0 5
1 7 0 |
20. Current loans
22. Equity and reserves
Issued capital
The approved share capital that was totally paid in
amounts to 20,069,870,000.00 tolars. It is divided into
2,006,987 shares with a nominal value of 10,000 tolars
each. The holders of shares are entitled to a dividend in
accordance with the resolution as adopted by the
Shareholders' Meeting. The ownership structure and its
changes are described in chapter 11 of the Annual
Report The Sava share and ownership structure.
The balance and movement of equity is clear from the
statement of changes in equity.
Share premium
The share premium amounts to 30,100,770,000 tolars. It
originates from:
• equity reserves that were formed on the basis of
privatisation regulations in the amount of
12,178,885,000 tolars;
• revaluating issued capital by price indices, which
according to Slovene Accounting Standards was
carried out until the end of 2001, in the amount of
12,773,885,000 tolars; and
• in 2004 the additionally paid in capital that amounted
to 5,148,000,000 tolars.
(SIT in thousands)
2005 2004
Originated loans 313,236 979,880
Current portion of non-current loans 260,998 62,404
Total 574,234 1,042,284
21. Cash and cash equivalents
(SIT in thousands)
2005 2004
Cash in hand and on accounts 742,577 540,444
Current deposits 1,826,280 172,724
Total 2,568,857 713,168
Reserves
Reserves amounted to 8,382,996,000 tolars and include:
• legal reserves totalling 1,720,987,000 tolars; and
• other reserves totalling 6,662,009,000 tolars, which
were formed according to the resolution by the Board
of Management. The Board of Management pursuant
to Slovene legislation has a legitimate option to
allocate one half of the profit for the current year as
determined according to Slovene Accounting
Standards into other reserves. In 2005 the Board of
Management allocated 2,144,140,000 tolars (2004:
1,538,284,000 tolars) to other revenue reserves.
Reserves for treasury shares
On 31 December 2005 the company had 3,289 treasury
shares, which represents 0.16 per cent of the total
number of issued shares. The cost of shares amounted to
53,787,000 tolars. This amount reduces the total equity.
In 2005 no changes occurred.
Fair value reserve
Fair value reserve amounts to 6,560,951,000 tolars and
includes revaluation effects of securities available for
sale to a fair value less deferred tax liability in relation
to these effects.

| notes to the consolidated financial statements in accordance with IFRS |
(number of shares)
2005 2004
No. of shares on 1 Jan. 2,006,987 1,720,987
Less treasury shares -3,289 -3,289
Increase in capital on 23/03/2004 - 286,000
Weighted average no. of ordinary shares 2,003,698 1,939,446
1 7 1 |
Retained earnings
Retained earnings amount to 27,952,373,000 tolars and
Dividends
include retained earnings from the previous year and net
profit for the year.
2005 2004
Dividend per ordinary share in the year (in SIT) 620 560
Total dividends to the debit of retained earnings (SIT in thousands) 1,242,294 1,122,057
Earnings per share
Share capital is divided into 2,006,987 ordinary shares
that all have voting rights and are freely transferable.
Weighted number of ordinary shares:
Net earnings attributable to ordinary shares amounts to:
The company has no bonds available to be converted
into shares.
2005 2004
Net profit for the year (SIT in thousands) 9,162,673 11,580,064
Weighted average no. of ordinary shares 2,003,698 1,939,446
Basic net earnings per share (in SIT) 4,572.88 5,970.81
The appropriation of profit is only possible within the
amount determined in accordance with Slovene
legislation. The legislation regulates that a parent
company may distribute profit as determined in
individual financial statements compiled in accordance
with Slovene Accounting Standards. On 31 December
2005 the profit amounted to 7,131,916,000 tolars.
2005 2004
Retained earnings of the Sava Group according to IFRSs 27,952,373 22,176,134
Retained earnings of the company Sava d.d. according to SAS 7,131,916 6,230,070
Difference not distributable 20,820,457 15,946,064

a n n u a l r e p o r t | 2 0 0 5
1 7 2 |
Reserves that are determined in accordance with IFRSs
are not available for distribution. The exception is other
revenue reserves as presented in accordance with
Slovene Accounting Standards, which may be allocated
to a distribution subject with the approval of the Board
of Management. On 31 December 2005 this reserve
amounted to 6,662,009,000 tolars.
Minority interest
In 2005 minority interest decreased by 627,240,000
tolars due to the additional purchase of stakes in
subsidiaries, and by 97,013,000 tolars due to a transition
to a joint controlling and, as a consequence,
proportionate consolidating. The increase in minority
interest of 52,900,000 tolars is represented by profits
attributable to minority interest.
Minority interest relates to the following companies:
Minority
(SIT in thousands)
Profits attributable
Minority interest interest capital to minority interest
2005 2004 2005 2004 2005 2004
Sava ROL d.o.o., Zagreb 24.0% 24.0% 9,469 9,243 591 697
Sava-Schäfer d.o.o., Kranj 50.0% 50.0% 0 93,532 0 29,166
Teol d.d., Ljubljana 1.3% 2.7% 2,920 8,731 -811 -3,358
Sava Trade d.d., Ljubljana 3.6% 5.0% 298,854 391,493 18,837 20,803
MG Market d.o.o., Ljubljana 28.2% 29.2% -545,367 -557,729 -16 -26,422
Savatrade Inc., Port Orange, Florida 5.0% 5.0% 979 624 249 597
Golf in Kamp d.d., Bled 8.4% 8.4% 117,759 115,314 2,676 -9,356
Grand Hotel Toplice Bled d.o.o., Bled 0.6% 1.1% 698 2,065 -241 224
G&P Hoteli Bled d.o.o., Bled 4.9% 12.6% 291,894 733,421 9,125 23,964
Terme 3000 d.d., Moravske Toplice 2.9% 3.3% 292,565 332,366 8,792 12,543
Terme Lendava d.d. 9.7% 9.3% 109,370 96,217 9,301 2,006
Terme Ptuj d.o.o. 30.1% 30.4% 405,146 389,353 19,741 17,385
Terme Radenci d.o.o., Radenci 2.9% 3.3% 159,465 200,478 -15,344 3,136
Total 1,143,753 1,815,107 52,900 71,385
The company Sava-Schäfer d.o.o,. Kranj was dealt with as a subsidiary throughout 2004, since it was not under joint
management the entire year.

| notes to the consolidated financial statements in accordance with IFRS |
1 7 3 |
23. Provisions
Provisions due to relief in payment of social security
contributions are formed in accordance with the Law on
Employment Rehabilitation and Disabled Persons
Employment. They are used for covering various
expenses as set out in the quoted law, particularly to
cover depreciation in plant, property and equipment in
the disablement company.
(SIT in thousands)
2004 Increases Decreases 2005
Provisions for liabilities to employees 1,460,500 96,563 -10,667 1,546,396
Provisions for law suits and other claims 216,401 31,583 -44,371 203,613
Warranties 56,981 0 -3,144 53,837
Others 13,205 8,650 -1,392 20,463
Total 1,747,087 136,796 -59,575 1,824,309
Provisions for liabilities to employees include liabilities
for retirement pay and employee jubilee benefits in the
amount as determined by the actuary calculation.
24. Government grants
Provisions for law suits are formed after consulting
lawyers who estimated the outcome of law suits filed
and other claims that relate to the denationalisation
procedure.
(SIT in thousands)
2004 Increases Decreases 2005
Provisions due to relief in social security payment 441,659 87,075 -77,632 451,102
Funds by EU and other funds 311,633 1,358,664 -66,837 1,603,460
Total 753,292 1,445,739 -144,469 2,054,562
25. Deferred tax liability
Deferred tax liability relates to the following items:
Funds obtained in the Pannonian Spas companies from
the structural funds were utilised for renovation of
tourist facilities such as the construction of a 5* hotel in
Moravske Toplice, renovation of Hotel Radin in
Radenci, construction of apartments in Lendava and a
swimming pool complex in Ptuj.
(SIT in thousands)
2005 2004
Liabilities of foreign subsidiaries 18,880 17,763
Deferred tax assets according to Slovene Accounting Standards -39,275 0
Revaluation of securities to fair value 2,186,984 3,402,121
Forming non-current provisions for retirement pay and employee jubilee benefits -381,888 -361,017
Total 1,784,701 3,058,867

a n n u a l r e p o r t | 2 0 0 5
1 7 4 |
Movement of deferred tax liability:
(SIT in thousands)
2005 2004
Initial balance 3,058,867 1,420,237
Increase in liability in foreign subsidiaries 1,117 10,189
Increase of deferred tax assets according to Slovene Accounting Standards -39,275 0
Change in liability due to revaluation of securities to fair value -1,215,137 1,633,474
Decrease in receivables for provisions for retirement pay 2,667 7,142
Increase in receivables for forming provisions for retirement pay -23,538 -12,175
Total 1,784,701 3,058,867
26. Interest-bearing borrowings
The explanation below provides information as to the
terms and conditions for granted loans. More
NON-CURRRENT BORROWINGS
information about the company's exposure to interest
and exchange rate risk is contained in item 9 of the
Annual Report.
(SIT in thousands)
2005 2004
Borrowings with domestic banks 12,757,339 8,726,011
Borrowings with foreign banks 1,242,740 2,376,157
Borrowings with others 480,294 596,387
Total non-current borrowings 14,480,373 11,698,555
CURRENT BORROWINGS
Current portion in non-current borrowings with banks 3,759,652 7,526,127
Current borrowings with domestic banks 26,763,103 15,491,611
Current borrowings with others 120,100 119,535
Total current borrowings 30,642,855 23,137,273
Total borrowings 45,123,228 34,835,828

| notes to the consolidated financial statements in accordance with IFRS |
Interest rate Maturity of last Type of
in % instalment insurance
NON-CURRENT BORROWINGS
- borrowings by associates from 3mEURIBOR+0.75 2007-2012 Bills of exchange,
to 6mEURIBOR+0.7
to TOM+2.9
mortgages, letter of comfort
- borrowings by domestic banks 1mEURIBOR+1.25 2010-2025 Bills of exchange,
do 1.5; 3-6mEURIBOR + mortgages, guarantees,
0.65 to 4.47; TOM+0.5 to
2.60; from 1 to 6.50 in SIT
cession
- borrowings by foreign banks from 3mEURIBOR+ 0.5 to 2007-2015 Guarantees, bills of
1.6; from 3-3.225 in SIT exchange, mortgage
- others 3m EURIBOR+0.75; 2009-2012 Bank guarantees,
CURRENT BORROWINGS
TOM+2.1 - 4 bills of exchange
- borrowings by associates 3.9-5.40 in SIT; 2006 Bills of exchange,
6mEURIBOR+0.65-0.67 letter of comfort
- current borrowings by domestic banks 3.48-5.5 in SIT; 2006 Bills of exchange,
3mEURIBOR + 0.5 to 1.6; letter of comfort
1mEURIBOR+0.6-1.5; guarantees, options,
6mEURIBOR+0.6 receivables, mortgage
- others 3.2-4.0 in SIT 2006 Not insured
(SIT in thousands)
2005 2004
Trade payables 7,150,394 7,604,365
Liabilities for received advances 547,443 443,542
VAT and other taxes 1,218,190 1,110,231
Employee payables 969,433 895,929
Other operating liabilities 821,564 733,727
Total 10,707,024 10,787,794
1 7 5 |
Terms and conditions for hiring borrowings:
Maturity of non-current borrowings:
27. Current liabilities
(SIT in thousands)
2005 2004
Between 1 and 2 years 6,277,481 3,951,548
Between 2 and 5 years 6,144,984 5,896,047
More than 5 years 2,057,908 1,850,960
Total 14,480,373 11,698,555

a n n u a l r e p o r t | 2 0 0 5
1 7 6 |
28. Accrued expenses
29. Financial instruments
Managing financial risks
The Sava Group has a very good rating, therefore it has
no difficulty in balancing liquidity and cash flows.
However, due to contracting debts in euro currency a
higher foreign currency risk exists. Due to a stable
exchange rate and expected euro introduction the risk is
low. Simultaneously with contracting debts in foreign
currency the EURIBOR rate risk increases, which
mainly serves as the basis for interest rates for debts
contracted anew. According to forecasts this basis
should rise in the future, therefore we are preparing an
interest rate protection which will include all companies
indebted at the EURIBOR-based interest rate. Managing
financial risk is explained in chapter 9 Risk
Management in detail.
Sensitivity analysis of financial risks
In financial risk we are highly exposed to a change in
(SIT in thousands)
2005 2004
Accrued expenses 338,138 405,228
Fair value of financial instruments
the interest rate and since almost three-quarters of
indebtedness is based on the inter-bank interest rate
EURIBOR, its influence is the greatest. Taking into
consideration the average indebtedness last year and the
current structure at 31/12/2005 each tenth of a change in
the average annual interest rate would increase interest
by almost 25 million tolars for the entire Group.
If indebtedness in the Group changed by 1 billion tolars,
the operating income would change by 35.3 million
tolars with the average December interest rate being
3.53 per cent at the Group level.
With regard to the expectations and forecasts, the
change in the euro rate has a considerably lower effect
on operations; ever since Slovenia accessed the
European Union the exchange rate has fluctuated only
slightly around the centrally agreed parity exchange rate
and it amounts to 239.640 tolars for one euro.
(SIT in thousands)
2005 2004
Book Fair Book Fair
value value value value
Securities available for sale 33,430,277 33,430,277 32,141,290 32,141,290
Non-current receivables 2,704,451 2,704,451 442,475 442,475
Current receivables 12,075,122 12,075,122 11,525,492 11,525,492
Granted loans 574,234 574,234 1,042,284 1,042,284
Cash and cash equivalents 2,568,857 2,568,857 703,168 703,168
Non-current loans 14,480,373 14,480,373 11,698,555 11,698,555
Non-current operating liabilities 17,418 17,418 47,329 47,329
Current loans 30,642,855 30,642,855 23,137,273 23,137,273
Current operating liabilities 10,707,024 10,707,024 10,787,794 10,787,794

| notes to the consolidated financial statements in accordance with IFRS |
2005 2004
No. of Sava d.d. shares owned by Gorenjska Banka 52,500 52,500
Stake of Gorenjska Banka d.d. in Sava d.d. 2.62% 2.62%
1 7 7 |
Estimating fair values
Securities available for sale
The fair value of a available-for-sale securities that are
listed equals the quoted market price on the balance
sheet date. The fair value of shares and stakes of unlisted
companies is estimated on the basis of last known
transactions.
Interest-bearing loans and borrowings
The fair value is estimated as a discounted value of
expected cash flows from the principal and interests,
whereby the effective interest rate equals the contracting
interest rate, which fluctuates and mainly changes every
three months (3-month Euribor).
Current receivables and liabilities
For receivables and liabilities with a remaining life of
less than one year, the notional amount is deemed to
reflect the fair value.
30. Contingencies
At 31 December 2005 the Sava Group presents no
contingencies. All known liabilities are included in the
consolidated financial statements.
31. Related parties
Related parties include subsidiaries and associates,
members of supervisory boards, board of management
of the parent company and subsidiaries in the Group and
their close family members.
Relations with subsidiaries
Business relations among the companies of the Sava
Group relate to the purchase and sale of raw materials,
finished products and merchandise. Services provided
within the Sava Group companies are mainly rents for
real estate and equipment, the use of the trade mark and
services by competence centres.
Transactions among related parties are performed on an
arm's length basis.
For loans which associates borrowed from banks and are
presented in the consolidated financial statements under
liabilities to banks guarantees were issued by the parent
company. The guarantees at 31/12/2005 totalled
10,353,612,000 tolars. Issued guarantees are considered
insurance contracts according to IFRS 4.
Relations with associates
Gorenjska Banka d.d., Kranj is the most important
associate of Sava d.d.:
The companies in the Sava Group raise loans with and make deposits in Gorenjska Banka. Terms and conditions for
these transactions equal those effective for other companies with a similar rating.
Survey of transactions with Gorenjska Banka d.d.
(SIT in thousands)
2005 2004
Balance of raised borrowings at 01/01 5,043,095 3,402,002
Hiring new borrowings 3,672,250 5,765,880
Repayment of borrowings -3,657,905 -4,124,787
Balance of raised borrowings at 31/12 5,057,440 5,043,095
Balance of paid deposits at 31/12 100,313 0

a n n u a l r e p o r t | 2 0 0 5
1 7 8 |
Borrowings hired with Gorenjska Banka d.d. bear
interest at various interest rates: 3month
EURIBOR+0.65%, 6 month EURIBOR+0.65-0.70%,
TOM+2.9%.
Foreign currency deposits with Gorenjska Banka d.d.
were paid in this year in total, the interest rate being 1.05
per cent.
In 2005 value adjustments were formed due to a loan
granted to the company LIMB, d.o.o. in the amount of
71,100,000 tolars.
Relations to natural persons
Related natural persons (chairman and board members
of the parent company and the supervisory board and
their close family members) own 4,190 shares in the
parent company Sava d.d., which represents 0.209 per
cent of ownership.
No. of shares Stake in capital
Board of Management of Sava d.d. members 2,563 0.128 %
Closer family members of Sava d.d. Board members 137 0.007 %
Sava d.d. Supervisory Board members 122 0.006 %
Managers in subsidiaries 817 0.041 %
Supervisory Board members in subsidiaries 551 0.027 %
Total 4,190 0.209 %
Gross income in 2005:
(SIT in thousands)
2005 2004
Board members 697,606 598,036
Other employees with managerial contracts 1,433,443 1,223,144
Supervisory Board members 89,376 41,917
Gross income includes salaries, bonuses and other proceeds.
Company receivables due from related natural persons:
(SIT in thousands)
2005 2004
Board members 2,972 4,287
Other employees with managerial contracts 16,149 25,422
Supervisory Board members 0 0
Receivables relate to granted housing loans to
employees. Loans were granted at the effective market
interest rate on the day of loan approval.
There are no liabilities of companies to related natural
persons.

| notes to the consolidated financial statements in accordance with IFRS |
1 7 9 |
32. Events after the balance sheet date
The events that occurred after the balance sheet date and
are important for the company are described in chapter
4.2 in detail and are as follows:
• The Supervisory Board adopted a resolution to
restructure the Trade division by selling the existing
companies Sava Trade d.d. and MG Market d.o.o. and
acquire a significant stake in the company Merkur.
The information about Trade is disclosed in item
28.2.2 that contains information by segment and
demonstrates the influence of excluding the Trade
division from the Sava Group.
• By an increase in the share capital in the company
Merkur and additional purchases of shares Sava d.d.
has implemented an important part of the planned
strategic restructuring of its Trade division.
Among those events there were none which would
require any revisions in the consolidated financial
statements.
33. Key sources of estimation
uncertainty
Non-current provisions are formed for retirement pay
and employee jubilee benefits in accordance with the
law, collective agreement and internal regulations. The
amount was establised on the basis of an actuary
calculation which used a discounted rate of 2.75 per cent
annually. In the case of a change in the law or interest
rate the amount of required provisions for this purpose
could change.
The fair value of investment property cannot be
ascertained on the basis of future cash flows as the
contracts about the financial lease have been concluded
for the period of one year maximum. As a fair value the
book value of investment property is used. The Board
estimates that there is no significant difference between
the fair and book value, which mainly originates from
cost value of real estate that were built in 2003anew.
34. Explanation of transition to IFRSs
The accounting principles as explained in chapter 28.2.
have been applied in the preparation of both the
consolidated financial statements at 31 December 2005
and the comparative figures for the year 2004, as well as
the opening balance sheet compiled in accordance with
IFRSs at 1 January 2004.
In preparing the opening balance sheet according to
IFRSs the financial statements that in previous years had
been prepared according to Slovene Accounting
Standards were adjusted so as to consider IFRSs. The
tables below show the adjustment effects on the
financial position, financial performance and cash flows
of the Sava Group.

a n n u a l r e p o r t | 2 0 0 5
ASSETS
1 8 0 |
Changes in the consolidated Balance Sheet
(SIT in thousands)
Adjustments Adjustments
affecting Previous affecting
31/12/2003 Transfers equity 01/01/2004 31/12/2004 Transfers adjustments equity 31/12/2004
SAS IFRS SAS IFRS
Property, plant
and equipment 37,768,396 -2,016,012 0 35,752,384 58,968,946 -1,548,119 0 0 57,420,827
Intangible
assets 2,040,344 -694,086 -810,030 536,228 1,470,529 -417,004 -810,030 106,721 350,216
Investment property 0 2,706,700 0 2,706,700 0 2,337,783 0 0 2,337,783
Investments in
associates 12,336,305 572 6,451,627 18,788,504 0 19,752,696 6,451,627 -547,260 25,657,063
Equity securities
available for sale 2,464,131 8,341,565 7,074,588 17,880,284 22,324,507 -3,791,699 7,074,588 6,533,894 32,141,290
Non-current
receivables 538,922 232,437 0 771,359 327,230 115,245 0 0 442,475
Total
non-current assets 55,148,098 8,571,176 12,716,185 76,435,459 83,091,212 16,448,902 12,716,185 6,093,355 118,349,654
Inventories 11,914,759 -155,118 0 11,759,641 10,614,956 0 0 0 10,614,956
Trade and
other receivables 11,671,517 672,126 0 12,343,643 10,755,820 704,338 0 0 11,460,158
Income tax
receivable 0 0 0 0 0 8,517 0 0 8,517
Current financial
investments 18,911,260 -12,174,348 0 6,736,912 18,441,351 -18,441,351 0 0 0
Current loans 1,197,053 0 0 1,197,053 0 1,042,284 0 0 1,042,284
Cash and cash
equivalents 576,871 2,391,694 0 2,968,565 529,645 183,523 0 0 713,168
Total current
assets 44,271,460 -9,265,646 0 35,005,814 40,341,772 -16,502,689 0 0 23,839,083
Total assets 99,419,558 -694,470 12,716,185 111,441,273 123,432,984 -53,787 12,716,185 6,093,355 142,188,737

| notes to the consolidated financial statements in accordance with IFRS |
EQUITY AND LIABILITIES
1 8 1 |
(SIT in thousands)
Adjustments Adjustments
affecting Previous affecting
31/12/2003 Transfers the result 01/01/2004 31/12/2004 Transfers adjustments the result 31/12/2004
SAS IFRS SAS IFRS
Issued capital 17,209,870 0 0 17,209,870 20,069,870 0 0 0 20,069,870
Share premium 24,952,770 0 0 24,952,770 30,100,770 0 0 0 30,100,770
Reserves 4,700,980 0 0 4,700,980 6,238,856 0 0 0 6,238,856
Fair value reserves 0 0 5,305,941 5,305,941 3,889,452 0 5,305,941 1,010,969 10,206,362
Treasury shares 0 -54,195 0 -54,195 0 -53,787 0 0 -53,787
Retained earnings 5,612,228 0 7,682,474 13,294,702 7,856,753 0 7,682,474 6,636,907 22,176,134
Minority interest 2,834,857 -640,275 -514,853 1,679,729 2,056,705 0 -514,853 273,255 1,815,107
Total equity 55,310,705 -694,470 12,473,562 67,089,797 70,212,406 -53,787 12,473,562 7,921,131 90,553,312
Non-current
provisions 2,841,126 0 -1,170,040 1,671,086 6,373,344 0 -1,170,040 -3,456,217 1,747,087
Deferred
government grants 477,338 0 0 477,338 753,292 0 0 0 753,292
Interest-bearing
borrowings 7,907,641 0 0 7,907,641 11,698,555 0 0 0 11,698,555
Non-current
operating liabilities 199,909 0 0 199,909 47,329 0 0 0 47,329
Deferred tax liabilities 7,574 0 1,412,663 1,420,237 17,763 0 1,412,663 1,628,441 3,058,867
Total non-current
liabilities 11,433,588 0 242,623 11,676,211 18,890,283 0 242,623 -1,827,776 17,305,130
Current
interest-bearing
borrowings 22,130,701 0 0 22,130,701 23,137,273 0 0 0 23,137,273
Current liabilities 10,081,976 0 0 10,081,976 10,787,794 0 0 0 10,787,794
Accrued expenses 462,588 0 0 462,588 405,228 0 0 0 405,228
Total current liabilities 32,675,265 0 0 32,675,265 34,330,295 0 0 0 34,330,295
Total liabilities 44,108,853 0 242,623 44,351,476 53,220,578 0 242,623 -1,827,776 51,635,425
Total equity
and liabilities 99,419,558 -694,470 12,716,185 111,441,273 123,432,984 -53,787 12,716,185 6,093,355 142,188,737

a n n u a l r e p o r t | 2 0 0 5
1 8 2 |
Explanation of the adjustments in the consolidated
balance sheet
Property plant and equipment is reduced by investment
property that according to Slovene Accounting
Standards was classified as fixed assets.
At 31 December 2003 the capitalised cost of
organisation incurred by the enterprises in the Sava
Group were recognised as intangible assets in the
amount of 810,030,000 tolars. These were in major part
(98%) due to the opening of new OBI stores. The
amount cannot be recognised according to IFRS, so it
was derecognised, and thus reducing retained earnings.
For the same reason, in 2004 capitalised cost of
organisation incurred by the enterprises was not
recognised in the amount of 15,626,000 tolars, which
reduces the income according to IFRSs. Due to
derecognition of these costs the amortisation totalling
122,347,000 tolars referring to these costs could not be
recognised. The total adjustment amount increases the
income for 2004 by 106,721,000 tolars.
Intangible assets were reduced due to derecognition of
goodwill in the amount of 640,275,000 tolars, a transfer
of leasehold improvements to property, plant and
equipment (30,195,000 tolars at 1 January 2004,
365,136,000 tolars at 31 December 2004), and a transfer
of advance payments for intangible assets to receivables
(23,616,000 tolars at 1 January 2004, 976,000 tolars at
31 December 2004).
According to Slovene Accounting Standards the Sava
Group companies did not present separately any
investment property. In certain companies investment
property was included in fixed assets, whereas in other
companies in non-current financial investments. At 1
January 2004 investment property was transferred from
assets and non-current financial investments. Their
value at 1 January 2004 totalled 2,706,700,000 tolars,
whereas at 31 December 2004 they totalled
2,337,783,000 tolars.
In accordance with Slovene Accounting Standards
treasury shares were presented under non-current
financial investments. Consistent with IFRSs they were
transferred directly to equity at 1 January 2004.
According to Slovene Accounting Standards investments
in associates were measured at cost until 2003, while the
profit was recognised as it was paid out. In 2004 the
accounting policy was changed and the investment was
increased by the total attributable profits for 2004, which
was recognised in the equity. Adjustments at 1 January
2004 amounting to 6,451,627,000 tolars represent the
attributable profits from previous years less received
dividends as of the year the company became an
associate until the year 2003. These profits were added to
the retained earnings. Adjustments in 2004 amounting to
547,260,000 tolars represent the received dividends in
2004, since the investment according to SAS was
increased by the total attributable profit.
Consistent with Slovene Accounting Standards the
majority of securities was presented as current financial
investments irrespective of their actual purpose.
Consistent with IFRSs and in accordance with the
company policy they are all classified as available for
sale and presented among non-current assets.
Non-current securities are investments in equity
securities of companies that are listed on the Stock
Exchange as well as other companies. These shares are
the financial potential of the parent company that in the
future will be invested in accordance with the Group's
business strategy. Therefore they are classified as
available for sale. Consistent with Slovene Accounting
Standards investments in shares of listed companies
were valued at cost which could not exceed the Stock
Exchange price on the balance sheet date. In accordance
with IFRSs their value was adjusted to the quoted
market price on the balance sheet date. The adjustment
effect increases the fair value reserve (as the part of the
equity) at 1 January 2004 by 5,601,095,000 tolars, and
at 31 December 2004 by an additional 4,927,790,000
tolars. The fair value adjustment of listed shares
amounts to 10,528,885,000 tolars at 31 December 2004.
The fair value reserve is reduced by deferred tax
liabilities amounting to 2,632,221,000 tolars. Shares and
interests in companies that are not listed on the Stock

| notes to the consolidated financial statements in accordance with IFRS |
1 8 3 |
Exchange were measured at cost according to Slovene
Accounting Standards, while the company had to
estimate annually the need for an impairment, thereby
considering the information about company operations.
Consistent with IFRSs these investments were revalued
to fair value that was ascertained in consideration of the
last known transaction in the previous year. The
The stated effects are shown below:
Cash comprises call deposits and deposits at up to three
months' notice that were transferred from current
financial investments (at 1 January 2004 deposits
amounted to 2,387,057,000 tolars, and 172,724,000
tolars at 31 December 2004).
A major part of non-current provisions includes the
negative goodwill being recognised in the consolidated
financial statements. A part in the amount of
2,558,977,000 tolars that originates from previous years
increased retained earnings, whereas a part that arose in
2004 amounting to 3,467,619,000 tolars increased the
income of the year. Other unrecognised provisions
applied to provisions for future advertising, of which
35,000,000 tolars were eliminated in the opening
balance, and 8,727,000 tolars in the year 2004.
revaluation effect increased the fair value reserve at
1 January 2004 by 1,473,493,000 tolars, and at
31 December 2004 by an additional 1,606,104,000
tolars. Fair value reserve of the unlisted shares at 31
December 2004 amounts to 3,079,597,000 tolars. The
fair value reserve is reduced by deferred tax liabilities
amounting to 769,899,000 tolars.
(SIT in thousands)
At For the Total at
01/01/2004 year 2004 31/12/2004
Effect of revaluation to fair value of listed securities 5,601,095 4,927,790 10,528,885
Effect of revaluation to fair value of unlisted securities 1,473,493 1,606,104 3,079,597
Total 7,074,588 6,533,894 13,608,482
Deferred tax liability due to revaluation to fair value of listed securities -1,400,274 -1,231,947 -2,632,221
Deferred tax liability due to revaluation to fair value of unlisted securities -368,373 -401,526 -769,899
Deferred tax liability total -1,768,647 -1,633,473 -3,402,120
Effect recognised in equity 5,305,941 4,900,421 10,206.362
Slovene Accounting Standards did not require forming
any non-current provisions for certain employee
benefits. On the basis of the actuary calculation
liabilities for employee jubilee benefits and severance
payment upon retirement were calculated at 1 January
2004 in the amount of 1,423,937,000 tolars and
additionally for 2004 in the amount of 20,130,000
tolars. The initial balance reduces retained earnings,
whereas the difference reduces the income for the year
2004. Deferred tax assets referring to these obligations
were accounted amounting to 361,017,000 tolars, which
decrease the deferred tax liability.

a n n u a l r e p o r t | 2 0 0 5
1 8 4 |
Certain of the mentioned changes affected the
classification of individual items, whereas others the
According to Slovene Accounting Standards and tax
legislation in previous years deferred taxes were not
accounted for. Therefore they were calculated and
retained earnings or other equity items. Due to the
transition to IFRSs the changes in equity were as follows:
(SIT in thousands)
Issued Share Fair value Treasury
Translation
equity Retained Minority
capital premium Reserves reserve shares adjustment earnings interest TOTAL
Balance acc. to SAS
at 31/12/2003 17,209,870 24,952,770 4,700,980 0 0 -37,751 5,649,979 2,834,857 55,310,705
ADJUSTMENTS
TO IFRSs
Transfer of treasury
shares 0 0 0 0 -54,195 0 0 0 -54,195
Revaluation of
securities available
for sale to fair value 0 0 0 5,305,941 0 0 0 0 5,305,941
Revaluation of
investments in
associates on an equity
accounted basis 0 0 0 0 0 0 6,451,627 0 6,451,627
Unrecognised
non-current
accrued expenses 0 0 0 0 0 0 -577,955 -232,075 -810,030
Unrecognised
non-current provisions 0 0 0 0 0 0 30,590 4,410 35,000
Provisions for
severance cost
and employee
jubilee benefits 0 0 0 0 0 0 -1,023,061 -44,892 -1,067,953
Adjustments to
consolidation on
equity method
Balance according to
0 0 0 0 0 37,751 2,763,522 -882,571 1,918,702
IFRSs at 01/01/2004 17,209,870 24,952,770 4,700,980 5,305,941 -54,195 0 13,294,702 1,679,729 67,089,797
presented in these financial statements for the first time.
Receivables and liabilities for deferred tax arose from
the following items:
(SIT in thousands)
01/01/2004 31/12/2004
The existing liability of foreign associates 7,574 17,763
Revaluation of securities to fair value 1,768,647 3,402,121
Forming non-current provisions for severance cost and employee jubilee benefits -355,984 -361,017
Total 1,420,237 3,058,867

| notes to the consolidated financial statements in accordance with IFRS |
1 8 5 |
Changes in the consolidated income statement
(SIT in thousands)
SAS 2004 Transfers
Adjustments
affecting net
income IFRSs 2004
Net revenue from goods sold and services rendered 56,385,784 0 0 56,385,784
Changes in inventories 188,980 0 0 188,980
Capitalised own products and services 113,555 -113,555 0 0
Other operating revenues 945,267 392,380 3,300,369 4,638,016
Cost of goods, material, services -39,274,773 113,555 -15,626 -39,176,844
Labour costs -12,329,755 0 -48,699 -12,378,454
Depreciation and amortisation -2,908,914 0 122,347 -2,786,567
Other write-offs -1,455,963 0 0 -1,455,963
Other operating expense -673,500 -56,969 0 -730,469
Operating income 990,681 335,411 3,358,391 4,684,483
Financial income 7,542,932 -552,960 0 6,989,972
Financial expenses -3,057,454 0 0 -3,057,454
Net financing income 4,485,478 -552,960 0 3,932,518
Share in income of associates 0 552,960 3,342,192 3,895,152
Pre-tax income 5,476,159 335,411 6,700,583 12,512,153
Extraordinary revenues 392,380 -392,380 0 0
Extraordinary expenses -56,969 56,969 0 0
Tax -865,737 0 5,033 -860,704
Net income for the financial year 4,945,833 0 6,705,616 11,651,449
Net income for the financial year attributable to:
Equity holders of the parent 4,905,407 0 6,674,657 11,580,064
Minority interest 40,426 0 30,959 71,385
Net income for the financial year 4,945,833 0 6,705,616 11,651,449

a n n u a l r e p o r t | 2 0 0 5
1 8 6 |
Explanation of the adjustments in the consolidated
income statement
Extraordinary revenues in the income statement were
transferred under other operating revenues, and
extraordinary expenses under other operating expenses.
Other items were correspondingly broken down to meet
the requirements of IFRSs for a separate disclosure.
The substance of adjustments in the income statement
affecting its amount is explained above in connection
with individual balance sheet items. Below they are
shown by the individual item of the income statement.
Other operating revenues were increased by
derecognition of negative goodwill amounting to
3,467,619,000 tolars that arose in 2004, by a reduction
in provisions for severance cost and employee benefits
(28,569,000 tolars) and unrecognised provisions for
advertising (8,727,000 tolars) and decreased for
negative goodwill in the amount of 204,546,000 tolars
utilised in previous years.
Cost of goods, materials and services were increased by
15,626,000 tolars for the cost of organisation incurred
by the enterprise that were capitalised in 2004 according
to SAS, and consistent with IFRSs they cannot be
recognised. At 1 January 2004 unrecognised noncurrent
capitalised expenses amounted to 810,030,000
tolars. In 2004 their amortisation amounted to
122,347,000 tolars. This amount increased the income
for the year 2004. Labour costs in 2004 were increased
by additional provisions for severance costs and
employee benefits on the basis of an actuary calculation
in the amount of 48,699,000 tolars. For the difference
between the reduction of provisions and formed
additional provisions for severance costs the deferred
tax receivable amounting to 5,033,000 tolars was
calculated.
The share in profit of associates is the attributable profit
that consistent with SAS in 2004 was not recognised in
the income statement.
All adjustments in the net income attributable to the
Group increased the income by 6,705,616,000 tolars.
Adjustments did not significantly influence the net
income attributable to minority owners, which increased
by 30,959,000 tolars especially due to amortisation of
unrecognised capitalised cost of organisation incurred
by the enterprise.
Explanation of changes in the consolidated cash flow
statement
The form of the cash flow statement according to
Slovene Accounting Standards differs considerably
from the cash flow statement according to IFRSs.
Therefore certain differences are not explainable. As far
as substance is concerned, the difference lies only in
classifying current call deposits and deposits at up to
three months’ notice in cash and cash equivalents,
whereas their movement according to SAS was
classified in current financial investments.

| statement by the board of management for the Sava Group |
28.3
1 8 7 |
Statement by the Board
of Management for the
Sava Group
The Board of Management confirms the consolidated
financial statements of the Sava Group for the year
ended 31 December 2005. These are the Group's first
financial statements that have been prepared according
to International Financial Reporting Standards.
The Board of Management confirms that appropriate
accounting policies have been applied on a consistent
28 March 2006
Vinko Peråiå
Member of the Board
Emil Vizoviæek
Member of the Board
basis and the consolidated report presents a true and fair
view of the financial position of the Sava Group and the
results of its operations for the year 2005.
The Board of Management is responsible for the proper
managing of accounting policies, adopting suitable
measures for securing the assets and other funds, and
confirms herewith that the financial statements and the
notes have been produced based on the assumption that
the company will proceed with its operation in
accordance with current legislations and International
Financial Reporting Standards.
Janez Bohoriå
Chairman of the Board

auditor’s report for the sava group | 2005
28.4
1 8 8 |
Auditor’s report for the Sava Group

| financial statements of the company Sava d.d. in accordance with SAS |
29.
29.1 Audited financial statements of the company Sava d.d.
in accordance with Slovene Accounting Standards
Audited Balance Sheet of the company Sava d.d.
Individual Balance Sheet items are explained in the breakdown and notes to the financial statements
(SIT in thousands)
INDEX
31/12/2005 31/12/2004 2005/2004
ASSETS
A. FIXED ASSETS 72,032,979 64,945,505 111
I. INTANGIBLE FIXED ASSETS 73,507 97,412 75
II. TANGIBLE FIXED ASSETS 18,162,294 16,533,547 110
III. LONG-TERM INVESTMENTS 53,797,178 48,314,546 111
B. CURRENT ASSETS 33,575,766 22,148,730 152
I. INVENTORIES 0 0
II, OPERATING RECEIVABLES 818,455 1,317,592 62
A) Long-term operating receivables 225,063 287,467 78
B) Short-term operating receivables 593,392 1,030,125 58
III. SHORT-TERM INVESTMENTS 32,754,766 20,827,216 157
IV. CASH IN BANKS, CHEQUES AND CASH IN HAND 2,545 3,922 65
C. DEFERRED COSTS AND ACCRUED REVENUES 838 211 397
TOTAL ASSETS 105,609,583 87,094,446 121
OFF-BALANCE ASSETS
LIABILITIES
7,885,590 8,781,079 90
A: CAPITAL 76,263,873 67,955,085 112
I. Called-up capital 20,069,870 20,069,870 100
II. Capital reserves 17,326,885 17,326,885 100
III. Revenues reserves 8,382,996 6,238,856 134
IV. Retained net profit or loss from previous periods 4,987,776 4,691,785 106
V. Net profit or loss for the financial year 2,144,140 1,538,285 139
VI. Equity revaluation adjustments 23,352,206 18,089,404 129
B: PROVISIONS 58,149 93,316 62
C: FINANCIAL AND OPERATING LIABILITIES 29,287,399 19,021,490 154
A) Long-term financial and operating liabilities 1,956,006 1,625,456 120
B) Short-term financial and operating liabilities 27,331,393 17,396,034 157
D: ACCRUED COSTS AND DEFERRED REVENUES 162 24,555 1
LIABILITIES TOTAL 105,609,583 87,094,446 121
OFF-BALANCE LIABILITIES 7,885,590 8,781,079 90
1 8 9 |
Financial Statements of the
company Sava d.d. with Notes
in Accordance with Slovene
Accounting Standards

a n n u a l r e p o r t | 2 0 0 5
(SIT in thousands)
JAN - DEC JAN - DEC INDEX
2005 2004 2005/2004
01. NET SALES REVENUES 1,905,903 1,820,972 105
02. CHANGE IN THE VALUE OF INVENTORIES OF PRODUCTS AND WORK IN PROCESS 0 0 -
03. CAPITALISED OWN PRODUCTS AND SERVICES 0 0 -
04. OTHER OPERATING REVENUES (WITH OPERATING REVENUES FROM
REVALUATION ADJUSTMENT) 414,495 110,874 374
05. COSTS OF GOODS, MATERIAL AND SERVICES 811,269 826,780 98
06. LABOUR COSTS 793,854 792,713 100
07. AMORTISATION AND DEPRECIATION EXPENSE 701,948 1,194,365 59
08. OTHER OPERATING EXPENSES 42,477 27,214 156
OPERATING PROFIT OR LOSS (1+2+3+4-5-6-7-8) -29,150 -909,226 -
09. FINANCIAL REVENUES FROM SHARES 6,374,304 6,335,144 101
10. FINANCIAL REVENUES FROM LONG-TERM RECEIVABLES 8,321 16,983 49
11. FINANCIAL REVENUES FROM SHORT-TERM RECEIVABLES 338,408 370,969 91
12. FINANCIAL EXPENSES FROM LONG- AND SHORT-TERM INVESTMENTS WRITE-OFFS 708,842 973,602 73
13. INTEREST EXPENSES AND FINANCIAL EXPENSES FROM OTHER LIABILITIES 787,153 1,092,552 72
14. TAX ON PROFIT OR LOSS FROM ORDINARY ACTIVITIES 0 0 -
15. NET PROFIT OR LOSS FROM ORDINARY ACTIVITIES 5,195,888 3,747,716 139
(1+-2+3+4-5-6-7-8+9+10+11-12-13-14)
16. EXTRAORDINARY REVENUES 72 37,234 -
17. EXTRAORDINARY EXPENSES 1,329 90 -
18. PROFIT OR LOSS FROM EXTRAORDINARY ACTIVITIES (16-17) -1,257 37,144 -
19. TAX ON PROFIT OR LOSS 909,698 708,291 128
20. DEFERRED TAXES -3,347 0 -
21. NET PROFIT OR LOSS FOR THE FINANCIAL YEAR 4,288,280 3,076,569 139
(15+16-17-19-20)
1 9 0 |
Audited Income Statement of the company Sava d.d.
Individual Income Statement items are explained in the breakdown and notes to the financial statements.

| financial statements of the company Sava d.d. in accordance with SAS |
A. CASH FLOWS FROM OPERATING ACTIVITIES
1 9 1 |
Audited Cash Flow Statement of the company Sava d.d.
(SIT in thousands)
JAN-DEC 2005 JAN-DEC 2005 JAN-DEC 2004 JAN-DEC 2004
INFLOWS OUTFLOWS INFLOWS OUTFLOWS
a) Inflows from operating activities 2,484,993 2,253,740
Operating revenues 2,011,123 1,976,570
Extraordinary revenues arising from operating
activities 22 37,234
Opening minus closing operating receivables
Opening minus closing deferred costs
474,475 239,977
and accrued revenues -627 -41
b) Outflows from operating activities
Operating expenses exclusive of depreciation
1,843,322 3,087,603
expenses and long-term provisions
Extraordinary expenses arising from operating
1,652,769 1,655,247
activities 1,329 90
Income tax and other taxes not included in
operating expenses 906,351 708,291
Closing minus opening inventories 0 -201
Opening minus closing operating liabilities
Opening minus closing accrued costs and
-741,520 722,204
deferred revenues 24,393 1,972
c) Net cash from operating activities (a minus b), or 641,671 0
Net cash from operating activities (b minus a) 0 833,863
B. CASH FLOWS FROM INVESTING ACTIVITIES
a) Inflows from investing activities 7,103,728 19,191,462
Financial revenues from investing activities 6,709,055 6,356,379
Extraordinary revenues from investing activities 0 0
Offset decrease in intangible fixed assets 0 0
Offset decrease in tangible fixed assets 0 738,421
Offset decrease in long-term investments 394,673 0
Offset decrease in short-term investments 0 12,096,662
b) Outflows from investing activities 12,721,712 23,939,160
Financial expenses from investing activities 277,181 797,808
Extraordinary expenses from investing activities 0 0
Offset increase in intangible fixed assets 999 0
Offset increase in tangible fixed assets 1,958,899 0
Offset increase in long-term investments 0 23,141,352
Offset increase in short-term investments 10,484,633 0

a n n u a l r e p o r t | 2 0 0 5
1 9 2 |
JAN-DEC 2005 JAN-DEC 2005 JAN-DEC 2004
(SIT in thousands)
JAN-DEC 2004
INFLOWS OUTFLOWS INFLOWS OUTFLOWS
c) Net cash used in investing activities (a minus b), or 0 0
Net cash used in investing activities (b minus a) 5,617,984 4,747,698
C. CASH FLOWS FROM FINANCING ACTIVITIES
a) Inflows from financing activities 8,156,322 7,722,385
Financial revenues from financing activities 0 321,993
Extraordinary revenues from financing activities 50 0
Increase in capital 0 6,847,244
Offset increase in long-term provisions 0 0
Offset increase in long-term financial liabilities 330,551 0
Offset increase in short-term financial liabilities 7,825,721 553,148
b) Outflows from financing activities 3,181,386 2,137,768
Financial expenses from financing activities 1,224,787 1,084,156
Extraordinary expenses from financing activities 0 0
Decrease in capital 1,926,426 0
Offset decrease in long-term provisions 35,167 9,649
Offset decrease in long-term financial liabilities 0 1,054,192
Offset decrease in short-term financial liabilities 0 0
Decrease in dividends payable -4,994 -10,229
c) Net cash used in financing operations (a minus B), or 4,974,936 5,584,617
Net cash used in financing operations (b minus a) 0 0
D. Cash and cash equivalent at end of period 2,545 3,922
Net increase in cash and cash equivalents
(sum net cash used Ac, Bc and Cc) -1,377 3,056
Cash and cash equivalents at beginning of period 3,922 866
In the 2005 cash flow statement the following items
were excluded as non-cash ones:
• depreciation in intangible fixed assets in the amount of
24,904,000 tolars;
• depreciation in tangible fixed assets in the amount of
651,405,000 tolars;
• revaluation adjustment in receivables in the amount of
24,662,000 tolars;
• financial expenses from shares in losses of subsidiaries
in the amount of 140,729,000 tolars;
• financial expenses due to impairments in loans of
associates in the amount of 150,894,000 tolars;
• receivables and liabilities for buyback of securities in
the amount of 1,363,123,000 tolars;
• specific equity revaluation adjustments in the amount
of 5,946,934,000 tolars.

| financial statements of the company Sava d.d. in accordance with SAS |
Change in Equity
1 9 3 |
Audited Statement of Changes in Equity of the company Sava d.d. for the period
from 31 December 2004 to 31 December 2005
Individual items of the Statement of Changes in Equity are explained in the breakdown and notes to the financial
statements.
(SIT in thousands)
Retained net Net profit
profit or loss or loss for
Called up Capital from previous the financial Equity revaluation
capital reserves Revenue reserves periods year adjustments
I II III IV V VI
Retained net Net profit General Specific
Reserves profit from for the equity equity
Share Capital Legal for own Statutory Other previous financial revaluation revaluation Capital
capital reserves reserves shares reserves reserves period year adjustments adjustments total
I/1 II III/1 III/2 III/3 III/4 IV/1 V/1 VI/1 VI/2
A. BALANCE AT 31/12/2004 20,069,870 17,326,885 1,720,987 53,787 0 4,464,082 4,691,785 1,538,285 12,773,885 5,315,519 67,955,085
B. Transfer to equity 0 0 0 0 0 0 0 4,288,280 0 5,946,934 10,235,214
- Entry of called-up capital 0 0 0 0 0 0 0 0 0 0 0
- Entry of net profit or loss for
the financial year 0 0 0 0 0 0 0 4,288,280 0 0 4,288,280
- Entry of general equity
revaluation adjustments 0 0 0 0 0 0 0 0 0 0 0
- Entry of specific equity
revaluation adjustments 0 0 0 0 0 0 0 0 0 5,946,934 5,946,934
- Other increases in capital 0 0 0 0 0 0 0 0 0 0
C. Transfer within equity 0 0 0 0 0 2,144,140 1,538,285 -3,682,425 0 0 0
- Allocation of net profit for the
financial year according to the board
of management and supervisory
board resolution 0 0 0 0 0 2,144,140 0 -2,144,140 0 0 0
- Allocation of net profit to
additional reserves according to
the resolution adopted by the
shareholders’ meeting 0 0 0 0 0 0 0 0 0 0 0
- Dissolution of reserves for own
shares and allocation to other
capital elements 0 0 0 0 0 0 0 0 0 0 0
- Other allocations within capital
elements 0 0 0 0 0 0 1,538,285 -1,538,285 0 0 0
D. Transfer from equity 0 0 0 0 0 0 -1,242,294 0 0 -684,132 -1,926,426
- Dividends and bonuses paid 0 0 0 0 0 0 -1,242,294 0 0 -1,242,294
- Other transfers from equity 0 0 0 0 0 0 0 0 0 -684,132 -684,132
E. BALANCE AT 31/12/ 2005 20,069,870 17,326,885 1,720,987 53,787 0 6,608,222 4,987,776 2,144,140 12,773,885 10,578,321 76,263,873

a n n u a l r e p o r t | 2 0 0 5
Change in Equity
1 9 4 |
Audited Statement of Changes in Equity of the company Sava d.d. for the period
from 31 January 2003 to 31 December 2004
(SIT in thousands)
Retained net Net profit
profit or loss or loss for
Called up Capital from previous the financial Equity revaluation
capital reserves Revenue reserves periods year adjustments
I II III IV V VI
Retained net Net profit General Specific
Reserves profit from for the equity equity
Share Capital Legal for own Statutory Other previous financial revaluation revaluation Capital
capital reserves reserves shares reserves reserves period year adjustments adjustments total
I/1 II III/1 III/2 III/3 III/4 IV/1 V/1 VI/1 VI/2
A. BALANCE AT 31/12/2003 17,209,870 12,178,885 1,720,987 54,195 0 2,925,798 5,033,887 818,246 12,773,885 0 52,715,753
B. Transfer to equity 2,860,000 5,148,000 0 -408 0 0 0 3,076,569 0 5,315,519 16,399,680
- Entry of called-up capital 2,860,000 5,148,000 0 0 0 0 0 0 0 0 8,008,000
- Entry of net profit or loss for
the financial year 0 0 0 0 0 0 0 3,076,569 0 0 3,076,569
- Entry of general equity
revaluation adjustments 0 0 0 0 0 0 0 0 0 0 0
- Entry of specific equity
revaluation adjustments 0 0 0 0 0 0 0 0 0 5,315,519 5,315,519
- Other increases in capital 0 0 0 -408 0 0 0 0 0 0 -408
C. Transfer within equity 0 0 0 0 0 1,538,284 818,246 -2,356,530 0 0 0
- Allocation of net profit for the
financial year according to the board
of management and supervisory
board resolution 0 0 0 0 0 1,538,284 0 -1,538,284 0 0 0
- Allocation of net profit to
additional reserves according to
the resolution adopted by the
shareholders’ meeting 0 0 0 0 0 0 0 0 0 0 0
- Dissolution of reserves for own
shares and allocation to other
capital elements 0 0 0 0 0 0 0 0 0 0 0
- Other allocations within capital
elements 0 0 0 0 0 0 818,246 -818,246 0 0 0
D. Transfer from equity 0 0 0 0 0 0 -1,160,348 0 0 0 -1,160,348
- Dividends and bonuses paid 0 0 0 0 0 0 -1,160,348 0 0 0 -1,160,348
E. BALANCE AT 31/12/ 2004 20,069,870 17,326,885 1,720,987 53,787 0 4,464,082 4,691,785 1,538,285 12,773,885 5,315,519 67,955,085

| notes to the financial statements of the company Sava d.d. in accordance with SAS |
1 9 5 |
Calculation of accumulated profit or loss
Proposal for the appropriation
of accumulated profit
In 2005 the joint stock company Sava created a net
profit in the amount of 4,288,280,000 tolars; in
compliance with the resolution by the Board of
Management and in accordance with the Supervisory
Board 50 per cent of this sum was allocated to other
revenue reserves.
As at 31 December 2005 the joint stock company Sava
showed in its accounting books accumulated profit in
the amount of 7,131,916,000 tolars.
(SIT in thousands)
CALCULATION OF ACCUMULATED PROFIT OR LOSS 31/12/2005 31/12/2004
21. NET PROFIT OR LOSS FOR THE FINANCIAL YEAR 4,288,280 3,076,569
22. Retained profit (loss) 4,987,776 4,691,785
23. Decrease (reversal) of capital reserves 0 0
24. Decrease (reversal) of revenue reserves 0 0
25. Increase (additional allocation) for revenue reserves -2,144,140 -1,538,284
26. ACCUMULATED PROFIT (ACCUMULATED LOSS) 7,131,916 6,230,070
(21+22+23+24-25)
29.2
The Board of Management of the joint stock company
Sava will propose to the Shareholders’ Meeting that
dividends be paid for the year 2005 in the amount of 640
tolars per share. 1,282,367,000 tolars will be allocated
for the distribution to shareholders and we shall propose
to the Shareholders’ Meeting that they utilise the
accumulated profit from the year 1999 as a distribution
source. In accordance with the proposal by the Board of
Management of Sava d.d. the remainder of the
accumulated profit in the amount of 5,849,549,000
tolars will remain undistributed.
Notes to the financial statements of the
company Sava d.d. in accordance with Slovene
Accounting Standards
ACCOUNTING POLICY OF THE COMPANY SAVA D.D.
Basis for drawing the financial
statements
The financial statements of the joint stock company
Sava were drawn in conformity with Slovene
Accounting Standards 2001, which had been issued by
the Slovene Institute of Auditors.
Due to better clarity the Balance Sheet and the Income
Statements of the joint stock company Sava are
presented in an abridged form; additional explanations
are contained in the disclosures.
The financial statements are drawn in Slovene tolars
rounded to one thousand units.
In 2006 too, the joint stock company Sava as a parent
company of the Sava Group will draw individual
financial statements in accordance with Slovene
Accounting Standards.

a n n u a l r e p o r t | 2 0 0 5
1 9 6 |
Segment reporting
Sava d.d. has not defined either business or geographical
segments.
Exchange rate and conversion method
in domestic currency
All of the items shown in the accounts books and
expressed in foreign currency are converted to the tolar
value at the medium exchange rate of the Bank of
Slovenia as valid on the last day of the accounting
period.
Intangible long-term fixed assets
Intangible long-term fixed assets include investments in
the acquired long-term rights on industrial property.
An intangible long-term fixed asset is initially
recognised at cost. Cost includes also the import and
non-refundable purchasing taxes. Cost does not include
the interests accrued by the appearance of an intangible
long-term asset.
Due to its increase in value the intangible long-term
fixed assets are not revalued. The mentioned method
applies also to intangible fixed assets that are purchased
abroad.
If the book value exceeds the substitutable value, the
value in intangible fixed assets will impair. The
substitutable value is determined on the basis of revenue
and expenses estimation, which arise from further use of
the assets considering thereby a suitable discount rate in
future cash flows.
Tangible fixed assets
At initial recognition a tangible fixed assets is valued at
cost. The cost includes its purchase expense, import and
non-refundable purchasing taxes and expenses which
can be attributed directly to its putting in service for the
intended use, especially expenses for its transport and
installation.
Costs do not increase the interests on loans for acquiring
a tangible fixed asset until it is put in service for the use.
The cost of a tangible fixed asset, which is constructed
or manufactured in the company, comprises expenses
that are caused by its construction or manufacturing and
indirect expenses for its construction or manufacturing
that can be attributed to it.
Due to the increase in value the tangible fixed assets are
not revalued; the effects of the impairment are shown in
operating expenses from revaluation.
The difference between the net sales value and the book
value of a disposed fixed asset is transferred under the
operating revenues from revaluation, if the former is
higher than the latter and under the operating expenses
from revaluation, if the latter is higher than the former,
respectively.
Expenses that arise later in relation to a tangible fixed
asset, increase its cost value, if they increase its future
benefits in comparison with the ones originally
estimated. The expenses that assure the prolongation of
serviceability period of the tangible fixed asset first
decrease the depreciation adjustment of its value
calculated by then.
Repairs of or maintaining the tangible fixed assets are
intended for renewing or preserving the future economic
benefits expected on the basis of the originally estimated
level of asset efficiency. They are recognised as
expenses upon their appearance.
Depreciation
The value of a tangible fixed asset and intangible fixed
asset that is not written off is decreased through
depreciation.
The tangible fixed asset starts to be depreciated on the
first day of the next month after beginning of use and
performing the activity, for which it is intended,
respectively.
The intangible fixed asset starts to be depreciated when
it is available for use.
The decrease in value of depreciable assets due to an
impairment are not depreciation costs but operating
expense from revaluation of depreciable assets, except if
at its precedent increase in value the equity revaluation
adjustment was enhanced. In such a case it should be
used before it increases the operating expenses from
revaluation of these assets.

| notes to the financial statements of the company Sava d.d. in accordance with SAS |
1 9 7 |
The depreciation rates are based on the service life of the assets and amount to:
Financial investments
Long-term investments
A long-term investment in capital, proprietary securities
of other companies or debtor’s securities of other
companies or the state are initially recognised at the cost
of purchase, which equals either the paid sum of money
or its equivalents, or the fair value of other substitutions
for a purchase invested by the investor on the exchange
day increased by costs that can be attributed directly to
the investment.
Long-term financial investments in capital of
subsidiaries and associates are valued so as to be
annually increased by that share of the net profit of
subsidiaries or associates, which belongs to the holding
company. Recording shares in profit of associates and
subsidiaries increase the equity revaluation adjustment
in connection with long-term financial investments.
The subsequently received shares in profit decrease the
originally shown increase in financial investment on the
basis of a share in profit.
Long-term investments in companies that are not
investments in subsidiaries or associates are valued in
the financial statements according to the investment
method and are annually not increased by a share of the
net profit that belongs to them. The allocated stakes in
the profit are dealt with outside the investments and
increase the financial revenues.
Long-term investments, which are relocated under
short-term investments, are transferred individually at
their book value.
Short-term investments
Short-term investments in the proprietary securities
of other companies and debtor’s securities of
year 2005 - in % year 2004 - in %
Intangible long-term fixed assets 20.0 20.0
Buildings from 2.5 to 4.0 from 2.5 to 4.0
Plant and machinery from 5.0 do 33.3 from 5.0 to 33.3
Other equipment from 10.0 do 25.0 from 10.0 to 25.0
companies or the state are initially valued at their
purchase value.
At the end of the year the value of those securities,
which are listed on the Stock Exchange, is compared
with the market price on the last day of the accounting
period. In case that the market price is higher than the
average purchase price the increase in value of the
investment is not carried out. If the market price is lower
than the average purchase price, then a revaluation
adjustment is formed for the investment.
For short-term securities, which are not listed on the
Stock Exchange, the actual value is determined on the
basis of last known transactions.
Receivables
At their initial recognition the receivables of all types are
shown in the amounts that arise from the corresponding
documents on condition that they will be paid. The
original receivables can later be increased, or irrespective
of payment or any other settlement, decreased by every
amount, which is proven by an agreement.
The advances in the balance sheet are shown in relation
with things they are refer to.
Receivables, which are assumed not be settled within
the due term and in total amount respectively, are
considered doubtful and, if a court procedure has
already began, disputable.
The revaluation adjustments in receivables are formed
as follows:
• a 100 per cent adjustment in all sued receivables and
receivables filed in a bankruptcy proceeding, as well
as current receivables, if the responsible service makes

a n n u a l r e p o r t | 2 0 0 5
1 9 8 |
a competent decision that reasonable grounds exist;
• an 80 per cent adjustment in receivables filed in an
obligatory enforcement proceeding.
Cash
Cash consists of book money. Book money is money on
accounts at a bank or any other financial institution and
can be applied for payment. It consists of immediately
available cash. The book value of cash equals its initial
nominal value until the need for a revaluation appears.
Cash in foreign currency is translated to a domestic
currency at the exchange rate on the day of receipt.
The revaluation adjustment of cash in foreign currency
is carried out on the day of reporting. It appears only in
case of cash expressed in a foreign currency. On
conversion the middle exchange rate of the Bank of
Slovenia is used. The revaluation adjustment of cash is
shown as financial revenue and expenses, respectively.
Capital
The total capital comprises called-up capital, capital
reserves, revenue reserves, retained net profit or loss
from previous periods, equity revaluation adjustments
and temporary also undistributed net profit.
Share capital is managed in the domestic currency.
Long-term provisions
Long-term provisions are formed from long-term
accrued costs or expenses and are earmarked for
covering contingent liabilities arising from lawsuits.
Liabilities
Liabilities are either financial or operating, short-term or
long-term.
All liabilities are initially recognised with the amounts
arising from the corresponding documents about their
appearance, which prove the receipt of cash or redemption
of any operating liability, in the case of long-term
operating liabilities the receipt of tangible fixed assets, in
the case of short-term operating liabilities the receipt of a
product or a service or performed work and charged costs,
expenses or a share in the net profit respectively.
Long-term liabilities are further increased by imputed
interests or decreased by repaid amounts and any other
settlements, agreed upon with a creditor. The book value
of long-term liabilities equals their original value
decreased by repayment of the principal and transfers
under short-term liabilities until the need for a
revaluation adjustment of long-term debts appears.
The book value of short-term liabilities equals their
original value adjusted by their increases or decreases as
agreed upon with the creditors until the need for their
revaluation adjustment appears.
Short-term and long-term liabilities of all kinds are
initially shown with the amounts, which arise from the
corresponding documents on condition that the creditors
request their repayment. The liabilities are later
increased with imputed yields (interests, other
compensations), about which an agreement is made with
the creditor. Liabilities are decreased by repaid amounts
and any other settlements in agreement with the
creditor. Long-term liabilities are decreased for the part
that should be paid in less than a year, which is shown
under short-term liabilities.
Short-term accruals and deferrals
Deferred costs and accrued revenues include short-term
deferred costs.
Short-term accrued costs and deferred revenues include
deferred input tax on added value due from effected
advances.
The basis for short-term accruals and deferrals are the
facts determined owing to certain knowledge and put
down as a resolution about the formation of short-term
accruals and deferrals and book-keeping documents
acquired from the external business partners.
Recognition of revenues
Revenues are recognised if the enhancement of
economic benefits in the accounting period is connected
with an increase in an asset or decrease in a liability and
such an increase could be reliably measured.
Revenues are recognised when it is legitimate to expect
they will result in earnings if these were not already
implemented at their appearance.

| notes to the financial statements of the company Sava d.d. in accordance with SAS |
1 9 9 |
Operating revenues
Revenues from provided services with the exception of
provided services that result in financial revenues are
measured at the selling prices of finished services or at
the selling prices of services in progress with respect to
the level of their completion.
Revenues from received subsidies or endowments are
measured in amounts that are approved for this purpose.
Operating revenues from revaluation arise upon the
disposal of tangible fixed assets and intangible fixed
assets considering the equity revaluation adjustment
from the precedent increase in the value of assets.
Financial revenues
Financial revenues are revenues from investment
activities. They arise in relation to long-term and shortterm
financial investments and also receivables.
Financial revenues are recognised upon accounting
irrespective of the proceeds if their size, maturity and
redemption are not doubted.
Interests are charged in proportion to the period expired
and with regard to the not yet redeemed share of the
principal and the valid interest rate.
Dividends and shares in profit achieved in subsidiaries
and associates are taken into account when they are
paid.
Financial revenues from revaluation arise upon the
disposal of long-term and short-term financial
investments considering the equity revaluation
adjustment from the precedent increase in the value of
financial investments.
Extraordinary revenues
Extraordinary revenues consist of extraordinary items.
They appear in actually incurred amounts.
Recognition of expenses
Expenses are recognised if a decrease in economic
benefits in the accounting period is connected with a
decrease in assets or an increase in liabilities and this
decrease could be reliably measured.
Operating expenses
Operating expenses are recognised when the material is
used and service provided, respectively.
Operating expenses are recognised in the period, to
which they relate.
Operating expenses from revaluation are recognised
when a corresponding revaluation adjustment is carried
out irrespective of their influence on the operating profit
or loss.
Operating expenses from revaluation arise in connection
with tangible fixed assets, intangible fixed assets and
current assets due to their impairment.
Financial expenses
Financial expenses are expenses for financing and
investing activities.
Financial expenses are recognised after balancing
irrespective of payments that are in relation with them.
Financial expenses from revaluation arise in connection
with long-term and short-term financial investments due
to their impairment and in connection with the increase
in the value of long-term and short-term liabilities.
Extraordinary expenses
Extraordinary expenses include extraordinary items that
are shown in actually arisen amounts.
Cash Flow Statement
Cash Flow Statement is drawn according to the indirect
method based on data from the Balance Sheet at 31
December 2005 and the Balance Sheet at 31 December
2004 and the data from the Income Statement for the
year 2005 and additional data, which is required for
adapting the inflows and outflows and a corresponding
breakdown of important items.

a n n u a l r e p o r t | 2 0 0 5
2 0 0 |
BREAKDOWN AND NOTES TO THE FINANCIAL STATEMENTS OF
SAVA D.D
Balance Sheet
Intangible fixed assets
Intangible fixed assets totalling 73,507,000 tolars
include the purchase licences for the MySAP.com and
Survey of intangible fixed assets
Movement of intangible fixed assets
ORACLE software applications. The value of newly
purchased licences in 2005 totalled 999,000 tolars. In
2005 the depreciation in the amount of 24,904,000 tolars
was charged.
(SIT in thousands)
INDEX
31/12/2005 31/12/2004 2005/2004
I. INTANGIBLE FIXED ASSETS 73,507 97,412 75
1. Long-term deferred operating costs 0 0 -
2. Long-term deferred development costs 0 0 -
3. Long-term industrial property rights 73,507 97,412 75
4. Goodwill 0 0 -
5. Advances for intangible fixed assets 0 0 -
(SIT in thousands)
COST VALUE
Long-term industrial
property rights TOTAL
Balance at 01/01/2005 124,356 124,356
Purchase, capitalisation 999 999
Disposals, write-offs 0 0
Revaluation adjustments 0 0
Balance at 31/12/2005 125,355 125,355
VALUE ADJUSTMENT
Balance at 01/01/2005 26,944 26,944
Purchase 0 0
Disposals, write-offs 0 0
Revaluation adjustments 0 0
Depreciation 24,904 24,904
Balance at 31/12/2005 51,848 51,848
CARRYING AMOUNT
Balance at 01/01/2005 97,412 97,412
Balance at 31/12/2005 73,507 73,507

| notes to the financial statements of the company Sava d.d. in accordance with SAS |
2 0 1 |
Tangible fixed assets
Tangible fixed assets totalling 18,162,294,000 tolars
present 17.4 per cent of the balance sheet total and are
10 per cent higher than last year. In accordance with the
business policy of the company certain investments in
subsidiaries were financed by the joint stock company
Sava and included in the assets of the company too. A
mortgage is placed on tangible fixed assets, precisely on
the Grand Hotel Toplice building, with Bank Austria
Creditanstalt due to the hired long-term loan for the
hotel renovation. As at 31 December 2005 the loan not
paid totals 670,812,000 tolars.
Survey of tangible fixed assets
The following significant changes in tangible fixed
assets appeared in 2005:
• 2,746,378,000 tolars were allocated to investments, of
which 2,661,474, 000 tolars were earmarked for the
purchase of strategic building plots, real estate and
equipment, 42,865,000 tolars for technology
improvements in manufacturing equipment in
Savatech d.o.o., and 42,039,000 tolars for computer
and other equipment;
• in 2005 the depreciation of tangible fixed assets was
charged in the amount of 635,747,000 tolars;
• in 2005 impairments in fixed assets were not required.
(SIT in thousands)
INDEX
31/12/2005 31/12/2004 2005/2004
II. TANGIBLE FIXED ASSETS 18,162,294 16,533,547 110
1. Land and buildings 14,280,196 12,933,473 110
a) Land 4,490,714 3,547,899 127
b) Buildings 9,789,482 9,385,574 104
2. Plant and machinery 2,440,043 2,307,146 106
3. Other equipment 129,551 166,391 78
4. Tangible fixed assets under construction 1,312,504 1,126,537 117
a) Advances for tangible fixed assets 0 0 -
b) Tangible fixed assets under construction and manufacture 1,312,504 1,126,537 117

a n n u a l r e p o r t | 2 0 0 5
(SIT in thousands)
Advances Tangible
for fixed assets
tangible under con-
Plant and Other fixed struction and
COST VALUE Land Buildings machinery equipment assets manufacture TOTAL
Balance at 01/01/2005 3,547,899 16,497,335 8,021,807 450,533 0 1,126,537 29,644,111
Purchase, capitalisation 1,003,370 1,081,811 473,444 1,786 2,362 1,725,886 4,288,659
Disposals, write-offs -60,555 -679,239 -305,335 -70,161 -2,362 -1,539,919 -2,657,571
Revaluation adjustments 0 0 0 0 0 0 0
Balance at 31/12/2005 4,490,714 16,899,907 8,189,916 382,158 0 1,312,504 31,275,199
VALUE ADJUSTMENT
Balance at 01/01/2005 0 7,111,761 5,714,661 284,142 0 0 13,110,564
Purchase 0 0 0 0 0 0 0
Disposals, write-offs 0 -273,595 -296,509 -63,302 0 0 -633,406
Revaluation adjustments 0 0 0 0 0 0 0
Depreciation 0 272,259 331,721 31,767 0 0 635,747
Balance at 31/12/2005 0 7,110,425 5,749,873 252,607 0 0 13,112,905
CARRYING AMOUNT
2 0 2 |
Movement of tangible fixed assets
Balance at 01/01/2005 3,547,899 9,385,574 2,307,146 166,391 0 1,126,537 16,533,547
Balance at 31/12/2005 4,490,714 9,789,482 2,440,043 129,551 0 1,312,504 18,162,294
Long-term financial investments
Long-term investments totalling 53,797,178,000 tolars
Survey of long-term financial investments
present 50.9 per cent of the balance sheet total and are
11 per cent higher than last year.
(SIT in thousands)
INDEX
31/12/2005 31/12/2004 2005/2004
III. LONG-TERM FINANCIAL INVESTMENTS 53,797,178 48,314,546 111
1. Shares in companies in the Group 27,558,437 26,123,735 105
2. Long-term loan receivables due from group enterprises 1,480,381 568,472 260
3. Shares in associates 23,794,413 19,652,824 121
4. Long-term loan receivables due from associates 0 0 -
5. Other long-term shares 907,312 1,911,488 47
6. Other long-term loan receivables 2,848 4,240 67
7. Own shares 53,787 53,787 100

| notes to the financial statements of the company Sava d.d. in accordance with SAS |
2 0 3 |
Shares in the Sava Group companies totalling
27,558,437,000 tolars were 5 per cent higher when
compared to last year. Significant changes in shares of
companies in the Sava Group were as follows:
• shares in the following companies increased: G&P
Hoteli Bled d.o.o. by 7.7 per cent, Sava Trade d.d.,
Ljubljana by 1.41 per cent, Terme 3000 d.d.,
Moravske Toplice by 0.42 per cent, Grand Hotel
Toplice Bled d.o.o. by 0.48 per cent, Golf in Kamp
Bled d.d. by 0.02 per cent;
• the share capital in the company ENSA d.o.o., Kranj
was increased by 17,900,000 tolars;
• In 2005 long-term financial investments in the
companies of the Sava Group were increased by
1,254,895,000 tolars with regard to the attributable
part of the net profit, and decreased by 140,729,000
tolars with regard to the attributable part of the loss in
the companies of the Sava Group.
Long-term loan receivables due from companies in the
Group in the amount of 1,480,381,000 tolars were
higher than last year, which is due to an approved long-
term loan to the company Sava Nova d.o.o. Zagreb in
the amount of 1,110,128,000 tolars.
Shares in associates in the amount of 23,794,413,000
tolars present a 41.13per cent share in Gorenjska
Banka d.d., Kranj.
Other long-term shares in the amount of 907,312,000
tolars were decreased by 53per cent when compared to
last year, which was mainly due to selling a stake in the
company Geoplin d.o.o.
Other long-term loan receivables in the amount of
2,848,000 tolars were long-term loans to third business
partners.
Own shares in the amount of 53,787,000 tolars were the
same as last year. The number of treasury shares at
31/12/2005 was 3,289; the nominal value of treasury
shares amounted to 32,890,000 tolars, while the number
of treasury shares represents 0.16 per cent of all shares
issued.

a n n u a l r e p o r t | 2 0 0 5
GROSS VALUE
2 0 4 |
Movement of long-term financial investments
(SIT in thousands)
Long-term Shares
Shares and loan and Long-term
stakes of receivables stakes and loan Other
companies due long-term receivables Other long-term
in from group receivables due from long-term loan Own
the Group enterprises in associates associates shares receivables stake TOTAL
Balance at 01/01/2005 26,278,779 568,472 19,652,824 0 2,020,175 4,240 53,787 48,578,277
Increase 1,576,585 1,151,395 4,825,259 0 201,404 20 0 7,754,663
Decrease 141,421 202,461 0 0 1,137,160 98 0 1,481,140
Decrease due to received
shareholding and dividends 462 0 683,670 0 0 0 0 684,132
Transfers 0 -37,025 71,100 0 -71,100 -1,314 0 -38,339
Revaluation adjustments 0 0 0 0 0 0 0 0
Balance at 31/12/2005 27,713,481 1,480,381 23,865,513 0 1,013,319 2,848 53,787 54,129,329
VALUE ADJUSTMENT
Balance at 01/01/2005 155,044 0 0 0 108,687 0 0 263,731
Increase 0 0 71,100 0 8,279 0 0 79,379
Decrease 0 0 0 0 10,959 0 0 10,959
Transfers 0 0 0 0 0 0 0 0
Balance at 31/12/2005 155,044 0 71,100 0 106,007 0 0 332,151
NET VALUE
Balance at 01/01/2005 26,123,735 568,472 19,652,824 0 1,911,488 4,240 53,787 48,314,546
Balance at 31/12/2005 27,558,437 1,480,381 23,794,413 0 907,312 2,848 53,787 53,797,178
Long-term operating receivables
Long-term operating receivables totalling 225,063,000
tolars decreased by 22 per cent when compared to last
year. 97 per cent of long-term operating receivables
refer to long-term loans to employees for the purchase
of flats. These loans were insured by a creditor’s
mortgage on flats.
The remaining 3per cent are receivables from
scholarships and tuition fees and receivables for
deferred taxes. Receivables for deferred taxes due from
the state were formed in the amount of 3,347,000 tolars.
None of the long-term operating receivables have been
matured as yet.

| notes to the financial statements of the company Sava d.d. in accordance with SAS |
II. OPERATING RECEIVABLES
2 0 5 |
Survey of long-term operating receivables
(SIT in thousands)
INDEX
31/12/2005 31/12/2004 2005/2004
A) Long-term operating receivables 225,063 287,467 78
1. Long-term trade receivables 0 0 -
2. Long-term receivables due from companies in the Group 0 0 -
3. Long-term receivables due from associates 0 0 -
4. Long-term receivables due from other entities 225,063 287,467 78
5. Long-term called-up capital unpaid 0 0 -
Short-term operating receivables
Short-term operating receivables totalling 593,392,000
tolars decreased by 42 per cent when compared to last
year, which is primarily due to a decrease in trade
receivables due from buyers of securities.
Short-term trade receivables are due to charged rentals
and other services outside the Sava Group; short-term
receivables due from companies in the Group are also
due to charged rentals and other services; short-term
II. OPERATING RECEIVABLES
Survey of short-term operating receivables
receivables due from other entities are mainly
receivables from buyers of securities and receivables
arising from VAT, which are due from the state.
In 2005 the value adjustment balance in trade
receivables decreased by 101,917,000 tolars and
increased by 10,490,000 tolars. On 31 December 2005
the value of adjustment balance in trade receivables
totalled 144,865,000 tolars.
Short-term operating receivables are not insured.
(SIT in thousands)
INDEX
31/12/2005 31/12/2004 2005/2004
B) Short-term operating receivables 593,392 1,030,125 58
1. Short-term trade receivables 14,404 44,703 32
2. Short-term receivables due from companies in the Group 192,726 202,001 95
3. Short-term receivables due from associates 7,975 0 -
4. Short-term receivables due from other entities 378,287 783,421 48

a n n u a l r e p o r t | 2 0 0 5
2 0 6 |
Survey of short-term operating receivables by maturity
Short-term financial investments
Short-term financial investments totalling 32,754,766,000
tolars represent 31.4 per cent of the balance sheet total.
Survey of short-term financial investments
(SIT in thousands)
TOTAL Due Not due
II. OPERATING RECEIVABLES
B) Short-term operating receivables 593,392 8,395 584,997
1. Short-term trade receivables 14,404 792 13,612
2. Short-term receivables due from companies in the Group 192,726 5,130 187,596
3. Short-term receivables due from associates 7,975 2,473 5,502
4. Short-term receivables due from other entities 378,287 0 378,287
Shares in companies in the Group totalling
3,863,351,000 tolars represent short-term loans to the
companies in the Sava Group.
(SIT in thousands)
INDEX
31/12/2005 31/12/2004 2005/2004
III. SHORT-TERM FINANCIAL INVESTMENTS 32,754,766 20,827,216 157
1. Shares in companies in the Group 3,863,351 3,661,878 106
2. Shares in associates 119,000 0 -
3. Own shares 0 0 -
4. Other short-term investments 28,772,415 17,165,338 168
Shares in associates totalling 119,000,000 tolars include
a short-term loan to the company Limb d.o.o. Ptuj.
Other short-term investments totalling 28,772,415
tolars consist of the following items:
• shares available for sale in the amount of
24,433,184,000 tolars;
• advances for purchase of securities in the amount of
2,008,978,000 tolars;
• short-term deposits with banks in the amount of
1,723,493,000 tolars;
• receivables for buyback of securities in the amount of
1,363,123,000 tolars;
• short-term loans to other companies in Slovenia in the
amount of 4,334,000 tolars;
• value adjustment of short-term financial investments
in the amount of 760,697,000 tolars.
80 per cent of shares purchased for sale include the
shares of Dom Holding d.d., Maksima Holding d.d.,
Mercator d.d., NFD 1 d.d. and NFD 2 d.d., Laæko
Brewery d.d. and KD Group d.d.

| notes to the financial statements of the company Sava d.d. in accordance with SAS |
2 0 7 |
On 31 December 2004 revaluation adjustments totalled
788,218,000 tolars. In 2005 an additional revaluation
adjustment in other short-term financial investments
was formed in the amount of 352,093,000 tolars and the
adjustment in the amount of 379,614,000 tolars was
eliminated. The revaluation adjustments balance at 31
December 2005 totalled 760,697,000 tolars, which
reflects the value adjusting to the stock exchange price.
Capital
The capital in the amount of 76,263,873,000 tolars is 12
per cent higher than last year.
In the structure of liabilities the capital has a 72.2 per
cent share.
In 2005 the following changes that influenced capital
were carried out:
• Net profit for the financial year of 4,288,280,000
tolars was created.
• Other revenue reserves were increased in accordance
with the proposal by the Board of Management and the
proposal by the Supervisory Board by 50 per cent of
the net profit in the amount of 2,144,140,000 tolars.
• According to the resolution of the Shareholders’
Meeting the sum of 1,242,294,000 tolars was
earmarked for dividends.
Already in 2004 the accounting principles in Sava d.d.
changed as regards using the equity method for treating
profits in subsidiaries. Interests in the profit of
subsidiaries are included under the specific equity
revaluation adjustments for long-term financial
investments and not under financial revenues. The total
specific equity revaluation adjustments for long-term
financial investments in the amount of 10,578,321,000
tolars include the following items:
• investments in subsidiaries in the amount of
2,680,500,000 tolars;
• investment in Gorenjska Banka in the amount of
7,897,821,000 tolars.

a n n u a l r e p o r t | 2 0 0 5
2 0 8 |
Survey of individual capital items
(SIT in thousands)
INDEX
31/12/2005 31/12/2004 2005/2004
A: CAPITAL 76,263,873 67,955,085 112
I. Called-up capital 20,069,870 20,069,870 100
a) Share capital 20,069,870 20,069,870 100
b) Uncalled capital 0 0 -
II. Capital reserves 17,326,885 17,326,885 100
III. Revenue reserves 8,382,996 6,238,856 134
1. Legal reserves 1,720,987 1,720,987 100
2. Reserves for own shares 53,787 53,787 100
3. Statutory reserves 0 0 -
4. Other reserves 6,608,222 4,464,082 148
IV. Retained net profit or loss from previous periods 4,987,776 4,691,785 106
V. Net profit or loss for the financial year 2,144,140 1,538,285 139
VI. Equity revaluation adjustments 23,352,206 18,089,404 129
1. General equity revaluation adjustments 12,773,885 12,773,885 100
a) Revaluation adjustment in share capital 12,773,885 12,773,885 100
b) Revaluation adjustment in paid-in capital surplus 0 0 -
c) Revaluation adjustment in reserves 0 0 -
d) Revaluation adjustment in retained net profit
or loss from previous periods 0 0 -
2. Specific equity revaluation adjustments 10,578,321 5,315,519 199
a) Revaluation adjustment for tangible fixed assets 0 0 -
b) Revaluation adjustment in long-term financial investments 10,578,321 5,315,519 199
c) Revaluation adjustment in short-term financial investments 0 0 -
d) Revaluation adjustment in long-term financial liabilities 0 0 -
e) Revaluation adjustment in short-term financial liabilities 0 0 -
Provisions
At the end of 2004 long-term provisions totalled
93,316,000 tolars, which were earmarked for covering
potential liabilities due to lawsuits. In 2005 certain
lawsuits ended with favourable result due to which the
provisions were eliminated in the amount of 44,000,000
tolars. For covering potential liabilities due to lawsuits
new long-term provisions were formed in the amount of
8,833,000 tolars. On 31 December 2005 the company
showed 58,149,000 tolars in long-term provisions.

| notes to the financial statements of the company Sava d.d. in accordance with SAS |
2 0 9 |
Survey of long-term provisions
(SIT in thousands)
INDEX
31/12/2005 31/12/2004 2005/2004
B: PROVISIONS 58,149 93,316 62
1. Provisions for pensions and similar 0 0 -
2. Provisions for tax liabilities 0 0 -
3. Other provisions 58,149 93,316 62
Long-term financial and operating liabilities
On 31 December 2005 the company showed long-term
financial liabilities to banks in the amount of
1,956,006,000 tolars, or 20 per cent more than in 2004.
Their share in the structure of finance sources is 1.9 per
cent.
Long-term loans are obtained from banks LHB, Bank
Austria Creditanstalt and NLB. All loans obtained are
nominated in euros. Interest rates for long-term foreign
currency loans are 3month-Euribor + 1%, 1-month-
Euribor + 1.25% and 3-month-Euribor + 0.70% to
0.85%. Loans obtained from Bank Austria Creditanstalt
Survey of long-term financial and operating liabilities
C: FINANCIAL AND OPERATING LIABILITIES
are insured with a mortgage on the building of Hotel
Toplice Bled and blank bills of exchange. Also the loan
obtained from Nova Ljubljanska Banka is insured with
blank bills of exchange, while other loans are not
insured.
The total amount of secured long-term loans amounts to
1,746,377,000 tolars.
The Maturity date of long-term financial liabilities is as
follows:
• in 2007 936,679,000 tolars
• in 2008 439,559,000 tolars
• in 2009 439,559,000 tolars
• in 2010 140,209,000 tolars
(SIT in thousands)
INDEX
31/12/2005 31/12/2004 2005/2004
A) Long-term financial and operating liabilities 1,956,006 1,625,456 120
1. Long-term financial liabilities arising from bonds 0 0 -
2. Long-term financial liabilities to banks 1,956,006 1,625,456 120
3. Long-term operating liabilities arising from advances 0 0 -
4. Long-term trade payables 0 0 -
5. Long-term bills payable 0 0 -
6. Long-term financial and operating liabilities to companies in the Group 0 0 -
7. Long-term financial and operating liabilities to associates 0 0 -
8. Long-term financial and operating liabilities to other entities 0 0 -

a n n u a l r e p o r t | 2 0 0 5
Balance of loans at 01/01/2005 1,625,456
New loans obtained in 2005 1,994,002
Repayments in 2005 -298,822
Transfer to short-term part -1,364,630
Balance of loans at 31/12/2005 1,956,006
2 1 0 |
Movement of long-term financial liabilities in 2005:
Short-term financial and operating liabilities
Short-term financial and operating liabilities totalling
27,331,393,000 tolars are 57 per cent higher than last
year. Their share in the liabilities structure amounts to
26.2 per cent.
Short-term financial liabilities to banks total
18,924,504,000 tolars and are 67 per cent higher than
last year. The increase is the result of a higher
indebtedness with banks due to intensive investment
activity and new formed liabilities for the buyback of
securities in the amount of 1,363,123,000 tolars. All
short-term loans are obtained from banks in Slovenia,
interest rates being 1-month Euribor + 0.60% to
Survey of short-term financial and operating liabilities
C: FINANCIAL AND OPERATING LIABILITIES
(SIT in thousands)
+0.75%, and 3-month Euribor +0.55% to +0.58%,
nominal interest rates being from 3.2 to 3.9 per cent.
Only the short-term part of long-term financial liabilities
is nominated in foreign currency. None of the short-term
financial liabilities to banks have fallen due as yet and
are all insured with bills of exchange.
Short-term trade payables totalling 140,525,000 tolars
have not become due.
Short-term financial and operating liabilities to
companies in the Group total 4,337,492,000 tolars and
are 199 per cent higher than last year. Financial liabilities
to companies in the Group represent 82 per cent of the
quoted sum, the remaining part being operating
(SIT in thousands)
INDEX
31/12/2005 31/12/2004 2005/2004
B) Short-term financial and operating liabilities 27,331,393 17,396,034 157
1. Short-term financial liabilities arising from bonds 0 0 -
2. Short-term financial liabilities to banks 18,924,504 11,352,805 167
3. Short-term operating liabilities arising from advances 0 22,671 0
4. Short-term trade payables 140,525 121,175 116
5. Short-term bills payable 0 0 -
6. Short-term financial and operating liabilities to companies in the Group 4,337,492 1,450,302 299
7. Short-term financial and operating liabilities to associates 2,990,819 3,492,847 86
8. Short-term financial and operating liabilities to other entities 938,053 956,234 98

| notes to the financial statements of the company Sava d.d. in accordance with SAS |
2 1 1 |
liabilities. The financial liabilities result from managing
the financial sources of the companies in the Sava Group.
Short-term financial liabilities to companies in the
Group are shown to the following companies:
• Sava Trade d.d. in the amount of 1,371,120,000 tolars;
• Sava IP d.o.o. in the amount of 539,197,000 tolars;
• Sava Medical and Services d.o.o. in the amount of
403,398,000 tolars;
• G&P Hoteli Bled d.o.o. in the amount of 310,648,000
tolars;
• Terme Lendava d.d. in the amount of 233,869,000
tolars;
• Terme Radenci d.o.o. in the amount of 160,368,000
tolars;
• Savatech d.o.o. in the amount of 230,121,000 tolars;
and
• to other subsidiaries in the Sava Group in the amount
of 288,378,000 tolars.
All quoted short-term financial liabilities are debts to the
companies in the Sava Group in Slovenia and have not
yet fallen due and are not insured. Interest rates for
obtained short-term loans from the companies in the
Sava Group range are from 3.2 per cent to 3.76 per cent.
Short-term financial and operating liabilities to
associates totalling 2,990,819,000 tolars are 14 per cent
lower than last year. The amount includes the principal
of received loans and liabilities for interests from
Survery of off-balance assets / liabilities
Gorenjska Banka d.d. The liabilities have not yet fallen
due and are insured with the bills of exchange. Interest
rates are from 3.9 per cent to 6-month Euribor + 0.60%.
Short-term financial and operating liabilities to other
entities totalling 938,053,000 tolars are 2 per cent lower
than last year. Liabilities from obtained loans from legal
entities outside the Group represent an 11 per cent share
and liabilities to the state a 45 per cent share, the rest
being liabilities to brokers of securities, liabilities for
salaries, unpaid dividends and other liabilities.
Accrued costs and deferred revenues
Accrued costs and deferred revenues totalling 162,000
tolars mainly refer to deferred input tax on VAT from
received advances.
Off-balance assets / liabilities
Issued guarantees mainly refer to the loans received by
subsidiaries. Under item mortgages the amount of the
loan from Bank Austria Creditanstalt is shown.
Other contingencies
As at 31 December 2005 the joint stock company Sava
did not have any other contingencies. All known
liabilities are included in the financial statements.
(SIT in thousands)
Structure Structure INDEX
31/12/2005 2005 31/12/2004 2004 2005/2004
Excluded farmland after
opening balance 42,098 0.5% 42,098 0.5% 100
Assets excluded according to order due
to nationalisation 82,333 1.0% 82,333 0.9% 100
Issued guarantees 7,090,347 89.9% 7,601,779 86.6% 93
Mortgages on the Grand Hotel Toplice building 670,812 8.5% 1,054,869 12.0% 64
TOTAL 7,885,590 100.0% 8,781,079 100.0% 90

a n n u a l r e p o r t | 2 0 0 5
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Income Statement
Net sales revenues
Since 2002 the net sales revenues of Sava d.d. mainly
present inter-company sales within the Sava Group. In
2005 the joint stock company Sava realised net sales
revenue in the amount of 1,905,903,000 tolars, which is
5 per cent more than in the same period last year.
Sales revenues are created from leasing out fixed assets
and equipment and providing other services mainly for
subsidiaries in the Sava Group, and to a lesser extent to
companies outside of the Group.
Survey of net sales revenues
Survey of costs of goods, materials and services
(SIT in thousands)
JAN - DEC JAN - DEC INDEX
2005 2004 2005/2004
01. NET SALES REVENUES 1,905,903 1,820,972 105
a) Revenues in domestic market 1,905,158 1,802,956 106
To companies in the Group 1,729,094 1,591,683 109
To other subsidiaries 16,921 0 -
To other entities 159,143 211,273 75
b) Revenues in foreign market 745 18,016 4
To companies in the Group 745 2,987 25
To other subsidiaries 0 0 -
To other entities 0 15,029 0
Costs of goods, materials and services
Other operating revenues (with operating revenues
from revaluation)
Other operating revenues with operating revenues from
revaluation totalling 414,495,000 tolars mainly arise – in
78 per cent - from the sale of assets in Ptuj and Maribor,
and partly from the sale of miscellaneous equipment that
Sava due to a discontinuation of programmes no longer
requires. 22 per cent of other operating revenues include
revenues due from eliminating long-term provisions and
accrued costs and deferred revenues for disposing of
hazardous waste and revenues due to settling receivables
that were already written off.
Cost of goods, materials and services in the amount of 811,269,000 tolars are 2 per cent lower than in the same period
last year.
(SIT in thousands)
JAN - DEC JAN - DEC INDEX
2005 2004 2005/2004
05. COSTS OF GOODS, MATERIALS AND SERVICES 811,269 826,780 98
a) Cost of merchandise and materials sold and cost
of raw materials and consumables used 54,241 64,787 84
b) Cost of services 757,028 761,993 99

| notes to the financial statements of the company Sava d.d. in accordance with SAS |
2 1 3 |
The table below shows costs of goods, materials and services by type of cost:
Survey of labour costs
(SIT in thousands)
31/12/2005 31/12/2004
Cost of materials 54,240 64,787
Cost of postal charges and transportation services 16,673 15,102
Cost of maintenance services 101,503 86,604
Cost of rentals 36,675 31,542
Cost refunds to employees 4,923 7,045
Cost of payment transactions, bank services and insurance premiums 25,012 24,103
Cost of intellectual and personal services 232,413 201,121
Cost of fairs, advertising and office allowances 98,514 72,946
Cost of other services 241,316 323,530
TOTAL 811,269 826,780
Labour costs
Labour costs totalling 793,854,000 tolars include
provisions for additional payments in 2005 in
accordance with managerial contracts.
The company shows the premiums charged for
additional pension insurance in the amount of 8,226,000
tolars under labour costs.
(SIT in thousands)
JAN - DEC JAN - DEC INDEX
2005 2004 2005/2004
06. LABOUR COSTS 793,854 792,713 100
a) Wages and salaries 589,630 567,324 104
b) Social security costs 105,564 104,666 101
c) Other labour costs 98,660 120,723 82
Amortisation and depreciation expenses, write-offs
Amortisation and depreciation expenses, write-offs total
701,948,000 tolars and are 41 per cent lower than last
year. In 2005 these costs are lower on account of
extraordinary impairments in fixed assets carried out in
2004.

a n n u a l r e p o r t | 2 0 0 5
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Survey of amortisation and depreciation expenses, write-offs
(SIT in thousands)
JAN - DEC JAN - DEC INDEX
2005 2004 2005/2004
07. AMORTISATION AND DEPRECIATION EXPENSES, WRITE-OFFS 701,948 1,194,365 59
a) Amortisation of intangible fixed assets, depreciation of
tangible fixed assets, and operating expenses from
revaluation of tangible and intangible fixed assets 676,309 1,178,315 57
b) Operating expenses from revaluation of operating current assets 25,639 16,050 160
Amortisation and operating expenses from revaluation
include the following items:
• amortisation of intangible fixed assets in the amount of
24,904,000 tolars;
• amortisation of tangible fixed assets in the amount of
635,747,000 tolars; and
• operating expenses from revaluation due to
elimination of fixed assets from use in the amount of
15,658,000 tolars.
Operating expenses from revaluation of operating current
assets totalling 25,638,000 tolars refer to value
adjustments of trade receivables and value adjustments
due from tuition fees and scholarships.
Survey of financial revenues from shares
Other operating expenses
Other operating expenses totalling 42,477,000 tolars
mainly represent paid contributions for urban real estate
as well as the housing and compensation fund and a
provision for lawsuits that might be lost.
Financial revenues from shares
Financial revenues from shares totalling 6,374,304,000
tolars are 1 per cent higher than in the same period last
year.
(SIT in thousands)
JAN - DEC JAN - DEC INDEX
2005 2004 2005/2004
09. FINANCIAL REVENUES FROM SHARES 6,374,304 6,335,144 101
a) Financial revenues from shares in Group companies 10,568 26,820 39
b) Financial revenues from shares in associates 1,361,350 1,537,276 89
c) Other financial revenues from shares
(incl. financial revenues from revaluation) 5,002,386 4,771,048 105
Financial revenues from shares in Group companies –
with the exception of associates in the amount of
10,568,000 tolars – mainly include exchange differences
of subsidiaries abroad.
Financial revenues from shares in associates in the
amount of 1,361,350,000 tolars include received
dividends from Gorenjska Banka d.d.
Other financial revenues from shares with financial
revenues from revaluation in the amount of
5,002,386,000 tolars are in 60 per cent due to proceeds
from the sale of the financial investment Geoplin d.o.o.
Ljubljana, whereas the remaining 40 per cent are due to
the sale of securities in tourist operations in Croatia,
other securities and other received dividends.

| notes to the financial statements of the company Sava d.d. in accordance with SAS |
2 1 5 |
Financial revenues from long-term receivables
When compared to last year financial revenues from
long-term receivables totalling 8,321,000 tolars are 51
Survey of long-term receivables
(SIT in thousands)
JAN - DEC JAN - DEC INDEX
2005 2004 2005/2004
10. FINANCIAL REVENUES FROM LONG-TERM RECEIVABLES 8,321 16,983 49
a) Financial revenues from long-term receivables due
from Group companies 0 56 0
b) Financial revenues from long-term receivables due from associates 0 0 -
c) Other financial revenues from long-term receivables
(incl. financial revenues from revaluation) 8,321 16,927 49
Financial revenues from short-term receivables
Financial revenues from short-term receivables in the
amount of 338,408,000 tolars are 9 per cent lower than
in the same period last year.
Interest revenues and revenues from short-term
receivables due from companies in the Sava Group –
except in associates dash in the amount of 296,545,000
tolars are charged interests from short-term loans,
operating interests and charged guarantees to companies
in the Sava Group.
per cent lower and are mainly due to revaluation of
long-term loans.
Interest revenues and revenues from short-term
receivables due from associates in the amount of
7,821,000 tolars are charged interests and guarantees to
the associate Limb d.o.o. from Ptuj.
Other interest revenues and revenues from short-term
receivables (including financial revenues from
revaluation) in the amount of 34,042,000 tolars include
interests from loans to others, positive exchange rate
differences and revenues from guarantees charged
outside the Sava Group.
Survey of financial revenues from short-term receivables
(SIT in thousands)
JAN - DEC JAN - DEC INDEX
2005 2004 2005/2004
11. FINANCIAL REVENUES FROM SHORT-TERM RECEIVABLES 338,408 370,969 91
a) Interest revenues and revenues from short-term receivables
due from Group companies 296,545 240,631 123
b) Interest revenues and revenues from short-term receivables
due from associates 7,821 191

a n n u a l r e p o r t | 2 0 0 5
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Financial expenses for long- and short-term
investment write-offs
Financial expenses for long- and short-term write-offs
totalling 708,842,000 tolars are 27 per cent lower than
last year.
Financial expenses from revaluation of investments in
companies in the Group totalling 220,523,000 tolars
mainly include financial expenses from revaluation for
participating in the loss of subsidaries (Teol d.d., Gea Sol
International d.o.o., Ensa d.o.o., Kranj) and forming value
adjustments in approved loans (Geasol International
d.o.o. and Ensa d.o.o.)
Survey of financial expenses for long- and short-term write-offs
(SIT in thousands)
JAN - DEC JAN - DEC INDEX
2005 2004 2005/2004
12. FINANCIAL EXPENSES FOR LONG- AND SHORT-TERM WRITE-OFFS 708,842 973,602 73
a) Financial expenses from revaluation of investments in companies
in the Group 220,523 175,650 126
b) Financial expenses from revaluation of investments in associates 71,100 0 -
c) Other financial expenses from revaluation 417,219 797,952 52
Interest expenses and expenses incurred in
connection with other liabilities
Interest expenses and expenses incurred in connection
with other liabilities totalling 787,153,000 tolars are 28
per cent lower than in the same period last year.
Financial expenses from revaluation of investments in
associates in the amount of 71,100,000 tolars is due to
an impairment in financial investment in the associate
Limb d.o.o., Ptuj.
Other financial expenses from revaluation amounts to
417,219,000 tolars, of which 86 per cent is due to an
impairment in short-term securities with regard to the
Stock Exchange market price, while the remaining 14
per cent are realised expenses from the sale of shortterm
securities.
Interest expenses and expenses incurred in connection
with other liabilities to companies in the Group totalling
74,076,000 tolars include mainly interest expenses for
bank loans.
Survey of interest expenses and expenses incurred in connection with other liabilities
(SIT in thousands)
JAN - DEC JAN - DEC INDEX
2005 2004 2005/2004
13. INTEREST EXPENSES AND EXPENSES INCURRED IN CONNECTION WITH
OTHER LIABILITIES 787,153 1,092,552 72
a) Interest expenses and expenses incurred in connection with other
liabilities to Group companies 74,076 57,860 128
b) Interest expenses and expenses incurred in connection with other
liabilities to associates 125,977 191,444 66
c) Other interest expenses and expenses incurred in connection with
other liabilities 587,100 843,248 70

| notes to the financial statements of the company Sava d.d. in accordance with SAS |
2 1 7 |
Interest expenses and expenses incurred in connection
with other liabilities to associates totalling 125,977,000
tolars are charged interests for loans from Gorenjska
Banka d.d.
Other interest expenses and expenses incurred in
connection with other liabilities totalling 587,100,000
tolars include interest expenses for other bank loans,
negative exchange rate differences and other financial
expenses.
Survey of extraordinary revenues and extraordinary expenses
(SIT in thousands)
JAN - DEC JAN - DEC INDEX
2005 2004 2005/2004
16. EXTRAORDINARY REVENUES 72 37,234 0
17. EXTRAORDINARY EXPENSES 1,329 90 1,477
a) Extraordinary expenses less expenses from equity revaluation adjustments 1,329 90 1,477
b) Extraordinary expenses from equity revaluation adjustments 0 0 -
Tax on profit
In 2005 the tax liability of the joint stock company Sava
totalled 909,698,000 tolars or 28 per cent more than in
Survey of tax on profit
Extraordinary revenues and extraordinary expenses
Extraordinary revenues totalling 72,000 tolars represent
revenues from settled lawsuits. Extraordinary expenses
in the amount of 1,329,000 tolars represent paid
compensation in a court procedure.
the same period last year and represents an effective tax
rate of 17.5 per cent.
The deferred tax totalling 3,347,000 tolars was formed
from adjustments in receivables and long-term provisions.
(SIT in thousands)
TAX ON INCOME OF LEGAL ENTTITIES INDEX
RECOGNISED IN THE INCOME STATEMENT 2005 2004 2005/2004
Tax assessed for the current year 909,698 708,291 128
- for the current year 909,698 708,291 128
- adjustments for previous years 0 0 -
Deferred tax -3,347 0 -
- from newly arisen and withdrawn temporary differences -3,347 0 -
- from the effect of applied past tax losses 0 0 -
TAX IN THE INCOME STATEMENT 906,351 708,291 128

a n n u a l r e p o r t | 2 0 0 5
2 1 8 |
Survey of tax on profit calculation
(SIT in thousands)
COMPARISON BETWEEN THE ACTUAL YEAR 2005 YEAR 2004
AND THE CALCULATED TAX RATE Rate Amount Tax Rate Amount Tax
Pre-tax profit 5,194,631 3,784,860
Tax on profit applying the official rate 25.0% 1,298,658 25.0% 946,215
Effect by tax rates in other countries 0.0% 0 0 0.0% 0 0
Expenses not tax-deductible 2.1% 426,804 106,701 3.6% 542,960 135,740
Effect of increase in tax rate on special profits 0.0% 0 0 0.0% 0 0
Non-taxed revenues -6.6% -1,380,712 -345,178 -3.7% -553,097 -138,274
Tax reliefs
- applied, having effect on tax liability decrease -2.9% -601,930 -150,483 -6.2% -941,558 -235,390
- remaining, to be utilised in the following years 0 0 0 0.0% 0 0
Tax loss
- applied, having effect on tax liability decrease 0.0% 0 0 0.0% 0 0
- remaining, to be utilised in the following years 0.0% 0 0 0.0% 0 0
Adjustments for previous years 0 0 0 0.0% 0 0
TAX ASSESSED FOR THE CURRENT YEAR -7.5% -388,960 -6.3% -237,924
Temporary difference for calculating deferred tax -0.1% -13,388 -3,347 0.0% 0 0
TAX IN THE INCOME STATEMENT 17.4% 906,351 18.7% 708,291
Under revenues that are not tax-deductible revaluation
of assets and debts, newly formed long-term provisions
and other not recognised expenses in accordance with
the Law on Legal Entities Income Tax are included.
Received dividends by Gorenjska Banka d.d., in which
we have a 41.13per cent shareholding, are shown under
Survey of receivables and liabilities for deferred taxes
non-taxed revenues and elimination of the already taxed
long-term provisions.
Tax reliefs utilised in 2005 relate to investments in
intangible and tangible fixed assets, employed disabled
persons, the pension scheme and donations.
(SIT in thousands)
RECEIVABLES LIABILITIES NET
Deferred taxes due from: 2005 2004 2005 2004 2005 2004
Operating receivables 1,139 0 0 0 1,139 0
Provisions 2,208 0 0 0 2,208 0
TOTAL 3,347 0 0 0 3,347 0

| notes to the financial statements of the company Sava d.d. in accordance with SAS |
2 1 9 |
Net profit or loss
The net profit for the financial year totalled
4,288,280,000 tolars in 2005 and is therefore 39 per cent
higher than in the same period last year or 26 per cent
higher than planned.
Based on a resolution by the Board of Management and
approval from the Supervisory Board 50 per cent of the
net profit for the financial year in the amount of
2,144,140,000 tolars is allocated to other revenue
reserves.
Net profit after converting capital into euros and cost of living
(SIT in thousands)
Calculated Decrease
Capital % growth effect in profit
CAPITAL\calculation in euros 66,028,659 0.00% 0 4,288,280
CAPITAL\calculation from cost of living growth* 66,028,659 2.30% 1,518,659 2,769,621
*cost of living
Shares in profit
The Shareholders’ Meeting has not approved any shares
in the profit to those who are not owners.
Data about group of persons
In 2005 the total gross income of the members of the
Board of Management amounted to 227,133,000 tolars.
This sum consists of gross salaries, gross bonuses and
other income.
In 2005 the total net income of the Board members
amounted to 96,182,000 tolars, which is 42 per cent of
gross income.
24 employees with managerial contracts received
gross income totalling 268,949,000 tolars in 2005. This
income includes gross salaries, gross bonuses and other
revenues.
Sava d.d. showed receivables to employees with
managerial contract in the amount of 1,860,000 tolars.
In 2005 the Supervisory Board members received
gross income totalling 83,486,000 tolars, of which paid
bonuses have a 94 per cent share, the remaining sum is
attendance fee. In 2005 also the liability to the member
of the Supervisory Board from the previous mandate
was settled in the amount of 6,843,000 tolars.
Survey of income for the Board of Management
(SIT in thousands)
Total Total
Gross income income
Gross Gross other in gross in net
NAME AND SURNAME salary bonuses income amount amount
Janez Bohori@, Chairman of the Board 48,207 28,366 3,380 79,953 33,697
Emil Vizoviœek, Member of the Board 44,626 26,280 3,043 73,949 31,405
Vinko Per@i@, Member of the Board 44,487 26,280 2,464 73,231 31,080
TOTAL 137,320 80,926 8,887 227,133 96,182
Other income includes holiday allowance, other work-related earnings and bonuses.

a n n u a l r e p o r t | 2 0 0 5
2 2 0 |
Basic Business Indicators
(SIT in thousands)
INDICATORS 31/12/2005 31/12/2004
1. BASIC FINANCING INDICATOR
a) rate of ownership of financing 0.72 0.78
capital/liabilities
b) rate of long-term nature of financing
sum of capital, long-term debts and provisions/liabilities
2. BASIC INVESTMENT INDICATOR
0.74 0.80
a) basic investment rate 0.17 0.19
fixed assets (according to net book value)/assets
b) rate of long-term nature of investing
(sum of fixed assets,long-term financial investments and long-term operating receivables/assets)
3. BASIC INDICATORS OF PARALLEL FINANCIAL STRUCTURE
0.68 0.75
a) capital coverage of fixed assets coefficient 4.20 4.11
capital/fixed assets (according to net book value)
b) direct coverage of short-term liabilities coefficient (fast coefficient) 0.00 0.00
cash/short-term liabilities
c) accelerated coverage of short-term liabilities coefficient (accelerated coefficient) 1.22 1.26
sum of cash and short-term receivables/short-term liabilities
d) short-term coverage of short-term liabilities coefficient (short-term coefficient) 1.23 1.27
short-term assets/short-term liabilities
4. BASIC ECONOMIC INDICATORS
a) economy of operations coefficient
operating revenues/operating expenses
5. BASIC PROFITABILITY INDICATORS
0.99 0.68
a) net profitability of capital coefficient 0.06 0.05
net profit in business year/average capital (without net profit for the year)
b) coefficient of dividend of share capital 0.06 0.06
sum of dividends for the business year/average share capital
Return on capital
The return on capital of Sava d.d., calculated as the ratio
between pre-tax profit for the financial year and the
average balance of equity, totalled 7.9 per cent in 2005,
which is 1.3percentage points more than last year.
The return on capital of Sava d.d., calculated as the ratio
between net profit for the financial year and the average
balance of equity, totalled 6.5 per cent in 2005, which is
1.2 percentage points more than last year.
The average balance of equity for 2005 is being
calculated without taking into account net profit for the
current year and specific equity revaluation adjustments
formed at the end of the current year.

| statement by the board of management for the company Sava d.d. |
29.3
2 2 1 |
Statement by the Board
of Management for the
company Sava d.d.
The Board agrees with the financial statements of the
company Sava d.d. for the year that ended on 31
December 2005.
The Board confirms that when drawing up the financial
statements it consistently applied the corresponding
accounting guidelines and the accounting estimates
28 March 2006
Vinko Peråiå
Member of the Board
Emil Vizoviæek
Member of the Board
were elaborated according to the principle of prudence
and cost efficiency, and that the annual report gives a
true and fair view of the company’s assets and its
business performance in the year 2005.
The Board is responsible for the proper managing of its
accounting procedures, adopting suitable measures for
securing assets and other funds, and confirms herewith
that the financial statements and notes have been
produced based on the assumption that the company will
proceed with its operations in accordance with the
current legislation and Slovene accounting standards.
Janez Bohoriå
Chairman of the Board

a u d i t o r ’ s r e p o r t f o r t h e c o m p a n y S a v a d . d . |
29.4
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Auditor’s report for the company Sava d.d.

| statement on conformity with the corporate governance code for slovenia |
2 2 3 |
Statement on conformity with
the Corporate Governance
Code for Slovenia
Sava d.d. has developed a system of corporate
governance that ensures transparency in managing
companies and the Sava Group, achieves and exceeds
the expectations of shareholders and other stakeholder
groups and protects their interests. The final goal of
Sava d.d. and each of its each of its subsidiaries is the
growth and development on sustainable basis, thus
strengthening long-term economic success.
The Board of Management of Sava d.d. has established
and maintained a strong ethical climate with the aim of
conducting its business in accordance with the highest
standards of personal and corporate behaviour. The
Board of Management of Sava d.d. has likewise
designed an efficient system of internal supervision that
maintains a suitable level of protection both with regard
to honesty and the accuracy of information concerning
its business. By appointing the reporting team, the
Board of Management of Sava d.d. has established an
additional mechanism for introducing best practice and
supervision over reporting to ensure that it is on time,
comprehensive, relevant and accurate while respecting
the principle of equality in informing all shareholders.
Information on the key development achievements of the
past year and the level of conformity with the best practice
in the area of corporate governance are detailed in Chapter
8. Corporate Governance System; the 2005 Annual Report
of the Sava Group and the company Sava d.d.
The policy and practice of corporate governance at Sava
d.d. observes the Corporate Governance Code for
Slovenia (hereinafter referred to as the Code), which as
of the year 2004 has been designed, developed and
established by the Ljubljana Stock Exchange d.d.,
Ljubljana, Association of Supervisory Board Members,
and the Manager’s Association with the aim of
specifying more precisely the standards of corporate
governance for public commercial enterprises in
Slovenia and to contribute to the rise of the corporate
governance culture in Slovenia.
The Board of Management of the joint stock company
Sava issued the former Corporate Governance Code for
Slovenia on 31 March 2005 and published it on 25 April
2005. Hence it follows from the announcement of this
statement, which is available also on the Sava d.d. web
site (www.sava.si) that the company observed the then
valid Code of 18 March 2004 in full with the exception
of some cases. The announced deviations and
explanations have remained to be decisive for 2005 until
the issue of the new code subsidiaries, which became
effective on 14 December 2005.
Herewith the Board of Management and the Supervisory
Board of the joint stock company Sava d.d. declare that
the joint stock company Sava d.d. respects the
provisions of the changed and amended code of 14
December 2005 in full except in cases where it deviates
from it, for which the following explanations are given:
Item 1.1.1.: The basic goals of the joint stock company
which performs lucrative activity is to maximise the
value of the company. This and other goals, which the
company pursues in performance of its activity shall be
written down in the company statute.
In its statute Sava d.d. has not separately laid down the
company goals except those defined by the Law on
Commercial Enterprises. The goal "to maximise the
value of company assets" is a constituent part of the
wording that represents the mission of Sava d.d. and is,
as well as other strategic company goals, contained in
public releases and reports, which are available for all
shareholders and the public.
Item 2.3.2: The method of determining the level of pay,
remuneration and other benefits for members of the
Board of Management must first be prescribed and
respect the criteria as they are presented especially:
• the range of tasks of an individual member of the
Board;
• the performance of an individual member of the
Board;
• the size of the company and its financial position;
• complexity of company management with regard to its
business and organisational structure;

a n n u a l r e p o r t | 2 0 0 5
2 2 4 |
• general economic circumstances in which the
company operates;
• the success of the company's business performance;
• meeting the strategic and annual plans;
• awards to members of the Board in subsidiaries; and
• recommendations for awarding endorsed by
professional organisations.
However, we believe that Sava d.d. does observe the
provisions, but the wording of the items is inaccurate as
it indicates that the company should adopt special
regulations in connection with the method of
determining pay levels, remunerations and other
benefits for members of the Board of Management. We
believe that a separate deed that would define the
criteria in advance is not required and we also believe
that in this way the required adaptability in decisionmaking
would be reduced. Therefore we further
maintain that the present arrangement according to
which the issue is regulated with criteria specified in
advance in individual contracts between the company
and individual members of the Board of Management,
while the decision about awarding the Board of
Management are adopted upon endorsing the annual
financial statements.
Item 6.1.5: The company must change the auditing
company or the auditor partner at least once every five
years.
Auditing of the financial statements of Sava d.d. has
been performed by KPMG Slovenija d.o.o., a select firm
of auditors, for more than five years, but in this period
the composition of the team of auditors has changed.
All other obligatory provisions of the Corporate
Governance Code of 14 December 2005, which were
published in full on the website of the Ljubljana Stock
Exchange (www.ljse.si), are fully observed by Sava d.d.
The vision of Sava d.d. in the field of corporate
governance is the conformity of the corporate
governance system with all good practices, which are
determined by the most progressive Slovene and
international practice.
The statement on observing the Corporate Governance
Code refers to the period from the implementation of the
Corporate Governance Code in the amended and
changed version of 14 December 2005 to the day of
publication of this Statement on 31 March 2006. The
Board of Management and the Supervisory Board of
Sava d.d. discussed and adopted the Statement on the
Corporate Governance Code for Slovenia on 21 April
2006. In accordance with the rules we shall regularly
publish a statement on conformity with the Corporate
Governance Code or its future variants in future annual
reports.
31 March 2006 Board of Management
and Supervisory Board of Sava d.d.

2 2 5 |
The Sava Group
Sava, d.d. - Holding
BOARD OF MANAGEMENT
Janez Bohoriå, Chairman
tel: +386 4 206 52 15, fax: +386 4 206 64 46
janez.bohoric@sava.si
Emil Vizoviæek, Member
tel: +386 4 206 52 10, fax: +386 4 206 64 46
emil.vizovisek@sava.si
Vinko Peråiå, Member
tel: +386 4 206 53 25, fax: +386 4 206 64 46
vinko.percic@sava.si
Competence centres
CORPORATE COMMUNICATIONS
Lidija Bregar, Director
tel: +386 4 206 58 19, fax: +386 4 206 64 01
lidija.bregar@sava.si
STRATEGIC FINANCE
Miha Dolinar, Director
tel: +386 4 206 59 88, fax: +386 4 206 64 46
miha.dolinar@sava.si
FINANCE
Iva Œagar, M.A., Procurator
tel: +386 4 206 63 46, fax: +386 4 206 64 46
iva.zagar@sava.si
STRATEGIC ACCOUNTING,
PLANNING & ANALYSES
Mojca Globoånik, Director
tel: +386 4 206 56 01, fax: +386 4 206 64 46
mojca.globocnik@sava.si
RISK MANAGEMENT
Vlasta Mekiæ, Director
tel: +386 4 206 51 36, fax: +386 4 206 64 46
vlasta.mekis@sava.si
| c o n t a c t p e r s o n s |
PROCURATORS
Iva Œagar, M.A.
tel: +386 4 206 63 46, fax: +386 4 206 64 46
iva.zagar@sava.si
Miran Hude
tel: +386 4 206 59 46, fax: +386 4 206 64 06
miran.hude@sava.si
INTERNAL AUDIT
Duæa Haloœan Sedej, M.A., Internal Auditor
tel: +386 4 206 53 26, fax: +386 4 206 64 46
dusa.sedej@sava.si
COST CONTROL AND OPERATIONAL
EXCELLENCE
Emil Vizoviæek, Board Member
tel: +386 4 206 52 10, fax: +386 4 206 64 46
emil.vizovisek@sava.si
STRATEGIC PURCHASING
Marko Ætebe, Director
tel: +386 4 206 63 73, fax: +386 4 206 64 22
marko.stebe@sava.si
MARKETING SYSTEMS
Alojzija Murn, Manager
tel: +386 1 280 03 90, fax: +386 1 280 03 20
alojzija.murn@sava-trade.si
HR, LAW & ORGANISATION
Tatjana Lozar, Director
tel: +386 4 206 56 16, fax: +386 4 206 64 60
tatjana.lozar@sava.si

a n n u a l r e p o r t | 2 0 0 5
2 2 6 |
STRATEGIC INFORMATICS
Georg Pollak, Director
tel: +386 4 206 53 07, fax: +386 4 206 64 46
georg.pollak@sava.si
QUALITY SYSTEMS
Joœe Vodiåar, Manager
tel: +386 4 206 52 85, fax: +386 4 206 64 36
joze.vodicar@sava.si
Divisions
Rubber Manufacturing
SAVATECH d. o. o., Kranj
Duæan Kveder, Director
tel: +386 4 206 52 74, fax: +386 4 206 64 60
dusan.kveder@sava.si
Vesna Åadeœ, Director
tel: +386 4 206 51 79, fax: +386 4 206 64 60
vesna.cadez@sava.si
SAVA - GTI d.o.o., Ptuj
Anton Rogina, Director
tel: +386 2 787 93 30, fax: +386 2 787 93 40
anton.rogina@sava.si
SAVA - SCHÄFER d.o.o., Kranj
IztokDolenc, Director
tel: +386 4 206 53 63, fax: +386 4 206 64 05
iztok.dolenc@sava.si
SAVA ROL d.o.o., Zagreb
Darko Vodanovifl, Director
tel. and fax: +385 1 366 74 89
sava-rol@zg.hinet.hr
SAFETY
Janez Fabijan, Manager
tel: +386 4 206 53 78, fax: +386 4 206 64 42
janez.fabijan@sava.si
EU PROJECTS
Primoœ Kozina, Director
tel: +386 4 206 52 91, fax: +386 4 206 64 04
primoz.kozina@sava.si
FOREIGN TRADE NETWORK
SAVA TRADE G.m.b.H., Munich, Germany
Zlatko Smrdel, Director
tel: +49 89 544 14 30, fax: +49 89 532 89 51
zlatko.smrdel@sava-trade.de
SAVA TRADE s.r.o., Prague, Czech Republic
Roman Drapela, Director
tel: +420 22 494 19 66, +420 22 494 25 67
fax: +420 22 494 25 59
roman.drapela@savatrade.cz
SAVA TRADE Sp. zo.o., Warsaw, Poland
Ryszard Zawadzki, Director
tel: +48 22 721 1361, fax: +48 22 721 1362
ryszard.zawadzki @savatrade.com.pl
SAVATECH TRADE Ltd., London
Great Britain
Boætjan Podjed, Director
tel: +44 020 8288 35 08, fax: +44 020 8688 00 55
bostjan.podjed@savatech.f9.co.uk
SAVA TRADE Inc., Port Orange, Florida
Tony Æimunac, Director
tel: +1 386 760 07 06, fax: +1 386 760 87 54
savatrade@bellsouth.net

2 2 7 |
Trieste Representative Office, Italy
Niko Golemac, Manager
tel: +39 040 2528 140, fax: +39 040 252 90 63
niko.golemac@sava.si
paolo.leghissa@sava.si
Trade
SAVA TRADE d. d., Ljubljana
Antonija Pirc, M.A., Director
tel: +386 1 280 02 04, fax: +386 1 280 03 20
antonija.pirc@sava-trade.si
Tourism
Andrej Æprajc, Director Tourism
tel: +386 4 537 77 12, fax: +386 4 537 77 22
andrej.sprajc@hotelibled.com
GOLF IN KAMP Bled d. d., Bled
Andrej Æprajc, Director
tel: +386 4 537 77 12, fax: +386 4 537 77 22
andrej.sprajc@hotelibled.com
Camping Bled
Marjeta Vizoviæek, Manager
tel: +386 4 575 20 01, fax: +386 4 575 20 02
marjeta.vizovisek@camping.bled.si
GRAND HOTEL TOPLICE d. o. o., Bled
Zvone Æpec, Director
tel: +386 4 579 11 70, fax: +386 4 574 18 41
info@hotel-toplice.com
Hotel Vila Bled
Emil Æink, Manager Hotel Vila Bled
tel: +386 4 579 15 00, fax: +386 4 574 13 20
emil.sink@vila-bled.com
| c o n t a c t p e r s o n s |
Moscow Representative Office, Russia
Branimir AnŸelifl, Manager
tel: +7 095 775 38 46, fax: +7 095 981 63 03
branimir.andjelic@savatech.ru
MG MARKET d.o.o., Ljubljana
Duæan Papeœ, Director
tel: +386 1 420 10 42, fax: +386 1 420 10 52
dusan.papez@mg-market.si
G&P HOTELI BLED d.o.o., Bled
Lidija Dokl, Director
tel: +386 4 575 10 00, fax: +386 4 575 10 49
lidija.dokl@gp-hoteli-bled.si
Hotel Golf, Bled
Fedja Pobegajlo, Director
tel: +386 4 579 20 00, fax: +386 4 574 17 68
fedjap@gp-hoteli-bled.si
Hotel Park, Bled
Ema Pogaåar, Director
tel: +386 4 579 30 00, fax: +386 4 574 15 05
ema.pogacar@gp-hoteli-bled.si
TERME 3000 d.d., Moravske Toplice
Duæan Bencik, General Manager
tel: +386 2 512 23 00, fax: +386 2 548 16 07
dusan.bencik@terme3000.si
Terme Lendava d.d., Lendava
Franc Huber, Director
tel: +386 2 577 44 40, fax: +386 2 577 44 18
franc.huber@terme-lendava.si
Terme Ptuj d.o.o., Ptuj
Andrej Klasinc, Director
tel: +386 2 749 45 10, fax: +386 2 749 45 20
andrej.klasinc@terme-ptuj.si

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Terme Radenci, d.o.o., Radenci
Milan Hojnik, Director
tel: +386 2 520 27 00, fax: +386 2 520 27 472
milan.hojnik@terme-radenci.si
Terme Banovci, Verœej
Lea Hofman, Manager
tel: +386 2 513 14 00, fax: +386 2 587 17 03
lea.hofman@terme-banovci.si
Real Estate
SAVA IP d.o.o., Ljubljana
Joœe Kavåiå, Director
tel: +386 1 430 41 50, fax: +386 1 231 31 70
joze@sava-ip.si
IP NOVA d. o. o., Ljubljana
Gorazd Rous, Director
Tel: +386 1 430 41 50, fax: +386 1 231 31 70
gorazd@sava-ip.si
Other Operations
TEOL d. d., Ljubljana
Danijel Æumej, General Manager
tel: +386 1 520 41 30, fax: +386 1 520 41 09
danijel.sumej@teol.si
SAVA MEDICAL IN STORITVE d.o.o., Kranj
Maksimiljan Fijaåko, Director
tel: +386 4 206 53 97, fax: +386 4 206 64 42
maksimiljan.fijacko@sava.si
Investment Finance
INVESTMENTS IN INNOVATIVE PROJECTS:
LIMB d.o.o., Ptuj
Natalija Potoånik, Director
tel: +386 2 787 93 19, fax: +386 2 787 93 27
natalija.potocnik@siol.net
Hotel Jeruzalem, Ljutomer
Branko Smodiæ, Manager
tel: +386 2 581 12 11 , fax: +386 2 581 11 48
hotel.jeruzalem-ljutomer@radenska.si
SAVA NOVA d.o.o., Zagreb
Joœe Kavåiå, Director
tel: +385 1 666 10 05, fax: +385 1 668 10 13
joze@sava-ip.si
ENSA d.o.o., Kranj
Stanko Cvenkel, Director
tel: +386 4 206 57 77, fax: +386 4 206 64 04
stanko.cvenkel@sava.si
Joœef Pæeniånik, Technical Director
tel: +386 2 787 93 21, fax: +386 2 787 9327
joze.psenicnik@limb.si

2 2 9 |
| c o n t a c t p e r s o n s |

a n n u a l r e p o r t | 2 0 0 5
Sava, d.d.
Annual Report 2005
Published by
Sava, d.d.
Concept
Sava, d.d.
Edited by
Sava, d.d.
Vesna Muravec
Written by
Sava, d.d.
Studio Kernel
English translators
Lea Terlikar
Mark Alexander Valentine
AD & Design
Kreattiva Advertising, d.o.o.
Printed by
ÅukGraf
Photography
Dragan Arrigler
Ivan Draækiå
Mitja Smrdel
Gorazd Kavåiå
May 2006
www.sava.si