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Financial information
The past year ushered in a series of challenges for the companies in the fuel sector. The decisions made by us have demonstrated that we are able to take rapid steps to adapt to a demanding environment and ensure the desired profitability for our projects.
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Segment performance
The segmental management model we have implemented enhances management efficiency, delivering cost and revenue synergies across the organization.
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Letter from the Vice-President of the Board
2014 ushered in a series of challenges for the companies in the fuel sector. The decisions made by the LOTOS Group have demonstrated that we are able to take rapid steps to adapt to a demanding environment and ensure the desired profitability for our projects.
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Business environment
The key factor that had a strong impact on both the global and Polish petroleum markets in 2014, with significant consequences for the LOTOS Group’s performance, was the price of crude oil, which also determined the price of petroleum products.
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Strategic objectives
The LOTOS Group’s Strategy is designed to strengthen our position as a strong, innovative and efficient business which plays a major role in ensuring national energy security.
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Business model
Our operations consist in crude oil production and processing, as well as wholesale and retail sale of petroleum products, among which are: fuels (unleaded gasoline, diesel oil and light fuel oil), heavy fuel oil, bitumens, aviation fuel, naphtha, propane-butane LPG and base oils.
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Risk and opportunities
At the LOTOS Group, we identify a range of diverse risks, which may affect all areas of our business. The key risks in terms of their impact on our operations are the financial risks as well as risks affecting the exploration and production area. In the analysis of the risks, we also factor in issues related to sustainable development.
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Key data 2014
With revenue of ca. PLN 28.5bn in 2014, we rank fourth in the group of 500 largest businesses in Poland.
Shareholding structure
The share capital of Grupa LOTOS did not change relative to 2013 and comprised 129,873,362 fully paid-up ordinary shares with a par value of PLN 1 per share. Each share confers the right to one vote at the General Meeting (GM) and carries the right to dividend.
On April 29th 2013, the Company was notified that, as a result of acquisition of Grupa LOTOS shares in transactions on the Warsaw Stock Exchange settled on April 24th 2013, the open-end pension fund ING Otwarty Fundusz Emerytalny increased its shareholding in the Company so that it exceeded the threshold of 5% of the total voting rights at theCompany’s General Meeting. ING OFE announced that as at December 31st 2014 it held 8.57% of total voting rights at the Company’s General Meeting.
On January 9th 2015, the District Court for Gdańsk-Północ in Gdańsk, 7th Commercial Division of the National Court Register, registered an increase in the share capital of Grupa LOTOS from PLN 129,873,362 to PLN 184,873,362, effected through the issue of 55,000,000 Series D ordinary bearer shares with a par value of PLN 1 per share pursuant to Resolution No. 2 of the Extraordinary General Meeting of September 8th 2014 on increasing the Company’s share capital by way of issue of new shares, public offering of new shares, setting the record date for determining the pre-emptive rights to new shares for November 18th 2014, conversion into book-entry form and seeking admission of pre-emptive rights, allotment certificates and new shares to trading on the regulated market of the Warsaw Stock Exchange, amending the Company’s Articles of Association and authorising the Supervisory Board to prepare a consolidated text of the Company’s Articles of Association.
At present, the share capital of Grupa LOTOS comprises 184,873,362 fully paid-up ordinary shares with a par value of PLN 1 per share. Each share carries the right to one vote at the General Meeting of Shareholders and the right to dividend.
In 2013-2014 and until the date of this Report, the State Treasury held ordinary bearer shares in Grupa LOTOS representing 53.19% of its share capital and the same proportion of voting rights at its General Meeting. As at December 31st 2014, ING OFE held 8.6% of Grupa LOTOS share capital. In 2014, the remaining 38.21% of the share capital was free float.
Shareholders holding 5% or more of total voting rights at the Annual General Meeting as at June 30th 2014
| Entity | Number of Grupa LOTOS shares | % of total voting rights at GM | % of share capital held |
|---|---|---|---|
| State Treasury | 69,076,392 | 79.06 | 53.19 |
| ING OFE | 8,000,000 | 9.16 | 6.16 |
One share in Grupa LOTOS confers the right to one vote at its GM. However, pursuant to the Company’s Articles of Association, the voting rights of Company shareholders are limited so that none of them can exercise more than 10% of total voting rights at the Company as at the date of the General Meeting, with the proviso that for the purpose of determining the obligations of buyers of major holdings of shares provided for in the Act on Public Offering, Conditions Governing the Introduction of Financial Instruments to Organized Trading and Public Companies of July 29th 2005 and the Act on Insurance Activity of May 22nd 2003, such limitation of voting rights is deemed non-existent.
