Annual report 2005 - Sava dd

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5. Report by the Chairman
of the Board
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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.