hellenic cables group at a glance…. · 1. message from the general manager the year 2011 became a...

HELLENIC CABLES Group at a glance….

Loans to Total Assets Working Capital to Sales

Liquidity ratio Investments

2007

47%

The largest cable manufacturer in SE Europe,

with 5 plants,

1,275 employees

exports to more than 50 countries

2008 20092010

2011

44%40% 44% 49%

2007

40%

2008 20092010

2011

32%41%

31%

21%

2007

2.43

2008 20092010

2011

2.091.82

1.401.25

2007

9.1

2008 20092010

2011

12.2 12.4

5.48.1

(in million euro) 2007 2008 2009 2010 2011Turnover 406,5 358,3 241,6 351,8 414,6EBITDA 34,9 14,4 11,1 13,2 20,9EBITDA Margin 8,6% 4,0% 4,6% 3,8% 5,0%Earnings Before Tax (EBT) 20,4 (1,8) (0,2) 0,6 3,6Earnings Before Taxes and Minority Interest (EBIT) 16,1 (1,0) (1,2) 0,4 3,3Net borrowing 134,1 95,5 83,3 102,4 151,8

HELLENIC CABLES S.A. - ANNUAL REPORT 2011

TABLE OF CONTENTSHELLENIC CABLES Group at a glance…. 11. Message from the General Manager 22. HELLENIC CABLES Group 43. History 44. Vision - Mission - Values 55. Philosophy and Strategy 66. Human Resources 77. Corporate Responsibility and Sustainable

Development 88. Products 109. Customers and Sales Network 1310. Plants and Manufacturing Process 1411. Indicative Main Product Manufacturing Process 1512. Group Key Financial Data 1613. Share performance 1814. Main Holdings 19

14.1 Icme Ecab SA 1914.2 FULGOR SA 2014.3 Genecos SA 2214.4 Metal Agencies SA 22

15. Board of Directors and Company Management 2316. Notice of General Meeting of Shareholders 24

1. Message from the General Manager

The year 2011 became a significant milestone for the Group due to the acquisition of FULGOR SA, which isexpected to play an important role in the future progress of the HELLENIC CABLES Group. FULGOR’sadministrative and operational integration started immediately and considerable progress was accomplishedin the first few months. With this addition, HELLENIC CABLES Group becomes one of the largest cablemanufacturing groups in Europe.

The acquisition falls under the scope of the Group's strategic planning and is expected to enhance the Group'sorientation towards exports and enrich its product portfolio with high added value cables, such as submarinepower cables. The Group reinforces its competitiveness, covers the needs of its growing customer list moreefficiently, secures more bargaining power in the supply of raw materials and is expected to benefit from moreefficient management of its working capital.

At an operational level, the benefits from economies of scale and increased flexibility with the addition of thenew production unit come into view gradually. Vertical integration through the production of 8mm wire isexpected to augment profitability and bring cost savings in management, distribution and production throughthe integration of departments and services. During the initial period, the Group is expected to incur increasedrestructuring expenditures for implementation of necessary improvements and a certain adaptation periodis required to arrive to the optimum operation, however significant medium-term cost benefits are expectedfrom this acquisition.

In 2011, there were signs of recovery in key European markets due to investments in the energy sector andrenewable energy sources in particular, while there was no change in the construction sector. However, politicaland economic developments in the Arab Counties led to a drop in demand in these markets that resulted toincreased competition, which shifted to European countries as well. Moreover, the reduced demand inEuropean Mediterranean counties was the result of the economic problems that these countries are facing.

In Greece, HELLENIC CABLES maintained its leading position in a declining or diminishing market with seriousliquidity problems. The decline of construction activities and the credit risk restriction policy lead to furtherdecrease of sales despite the higher prices of metals. However, the Greek market is constantly becoming lessimportant for the progress of HELLENIC CABLES Group as sales in Greece represented 29% of total salescompared to 39% in 2010; part of these were sales of materials and by-products to VIOHALCO companies.

In 2011, HELLENIC CABLES Group continued its growth path and improved its financial figures despite theadversities. The consolidated turnover stood at euro 415 million, noting an 18% increase from 2010, which isattributed to the Group’s increased sales in countries abroad and the integration of the subsidiary FULGOR,which was acquired on 29 July 2011.

Consolidated earnings before interest, taxes, depreciation and amortisation (EBITDA) amounted to euro 20.9million, noting a 58% increase from 2010, while earnings before interest and taxes (EBIT) stood at euro 11.8million, a 130% increase compared to 2010. This improvement is attributed both to the increase in sales and

2

to the improvement in margins despite strong competition and the rising prices of raw materials, due toincreased sales of added value products.

Consolidated earnings before taxes showed a profit of euro 3.6 million compared to euro 568 thousand in2010, while net consolidated profit after tax and minority interest amounted to euro 3.3 million or euro 0.117per share, compared to euro 374 thousand or euro 0.014 per share in 2010.

In 2011, investments totalling euro 8.1 million at Group level, pertained mainly to new mechanicalequipment to enrich the high added value product range, improve productivity and raise the capacity ofthe Group’s plants.

HELLENIC CABLES Group’s strategic priorities for 2012 are the administrative and operational incorporation ofFULGOR into the Group, attainment of synergies and economies of scale, increase of sales in internationalmarkets and energy network operators and improvement of the profit margins through increased sales ofadded value products. At the same time, efforts towards optimisation of the working capital managementare intensified.

In closing, I would like to note that we pursue continuous integration of the Principles of Corporate Governancein our goals and in our daily activities. In this context, we will maintain this momentum over the period tocome, focusing on further decreasing our environmental footprint, further improving Safety and maintainingour employees’ Health, consolidating cooperation with local communities and also on providing top qualityproducts to the Greek and international markets. An indication of our environmental awareness is that ourplants in Levadia and Oinofyta were certified according to ISO 14001:2004 standard in 2011.

Alexios AlexiouGeneral Manager

3HELLENIC CABLES S.A. - ANNUAL REPORT 2011

2. HELLENIC CABLES Group

HELLENIC CABLES Group is the largest cableindustry in Greece, owning five productionplants, four in Greece and one abroad. It is anexport oriented Group with a significant com-mercial presence in international markets.

Since its establishment, the Company has fo-cused on incorporating cutting-edge tech-nologies and aims to manufacturecompetitive products destined for the inter-

national market. The Group’s plants manufacture a wide range of products including power and telecommu-nications cables, enamelled wires, copper wires and compounds.

The main subsidiaries of HELLENIC CABLES are FULGOR, which manufactures power cables & 8mm copperwires and ICME, a power & telecommunications cables’ manufacturer.

HELLENIC CABLES SA is listed in the Athens Stock Exchange since 1994.

3. History

4

Cable production byVIOHALCO

Production of fibre-opticcables in cooperation

with SIEMENSIncorporation ofTELECABLES S.A.

Incorporation ofHELLENIC CABLES

Listing in the MainMarket of Athens Stock

Exchange (ASE)

2000 200119991994199119731950

Acquisition of SIEMENS’share in TELECABLES

S.A.

Acquisition ofmajority

shareholding inICME ECAB S.A.

Acquisition ofenvironmental

managementcompliance

certificate ISO14001

4. Vision - Mission - Values

The vision of HELLENIC CABLES is to help improve the quality of life of end consumers by manufacturing reli-able and safe products with advanced technologies, friendly both to users and to the environment.

Our mission is to respond directly to the needs of our customers around the world by constantly improvingour products and services, laying emphasis both on the development of our human resources and on our cor-porate and social responsibility and creating value for our shareholders and partners.

The values of our Company which guide all our internal and external activities both at individual and at col-lective level are:

• Respect for environment and people• Knowledge, training and professional conduct• Honesty, integrity and prudence• Team spirit and willingness to cooperate• Focus on action and results


2011200920082007200620042002 2003

Holding in ICMEECAB SA rises to

98.6%

First order forHigh Voltage

cables

Received"Committed to

Excellence"award by the

EuropeanFoundation for

QualityManagement

Received the"Recognised for

Excellence 3 star”award by the

EuropeanFoundation for

QualityManagement

Completion of anew plant in

Thiva

Operation of LSFflame-retardant

mixtures units

Operation of anew production

line for 400kVhigh and extra-

high voltagecables

Acquisition ofFULGOR

First order forExtra High

Voltage cables

®®

5. Philosophy and Strategy

HELLENIC CABLES Group is operating in a thoroughlycompetitive environment, both in Greece and abroad. Itslong-standing success is attained through the high qual-ity and competitiveness of its products and its focus onthe core principles of business excellence:

• Focus on results• Focus on customers• Leadership and consistent objectives• Procedure and data-based Management• Development and engagement of human

resources • Continuous learning, improvement & innovation• Development of partnerships • Corporate and social responsibility

Operating in an ever-changing environment, the Grouphas undertaken to implement its long-term businessplan having set the following strategic priorities:

• Administrative and operational incorporation of FULGOR in order to attain synergies and economies of scale. • Strong export orientation doubled by selective expansion, focusing on countries where investments in energy

and telecommunication networks and major investments in renewable energy sources are made.• Utilisation of new investments by focusing on high added value products such as high and extra-high voltage

cables, as well as submarine cables, which are less vulnerable to current economic developments.• Increase sales to energy network operators demonstrating a more constant demand and better prospects. • Improve competitiveness through reduced costs, more optimised management of inventories, improvement of

productivity and production flexibility. • Improve liquidity mainly through reduction of working capital requirements, entailing reduced borrowing and

conservative cash flow planning so as to enable the Company to take advantage of any opportunities and tacklethe adversities of financial markets.

• Focus on human resources and corporate social responsibility as arising from the adoption of the code of principleson sustainable development issued by the Board of the Hellenic Federation of Enterprises (SEV) on SustainableDevelopment (for more details, please refer to the Report on Corporate Responsibility and SustainableDevelopment).

6

6. Human Resources

HELLENIC CABLES lays particular emphasis on humanresources and invests considerable amounts in theongoing training and safety of its personnel.Concurrently, the Company looks after the health ofemployees in work areas and does not pollute theenvironment.

The Company places great emphasis on the lifelongeducation and training of its human resources, whichare the Company’s most important asset and thus invests considerable funds in this direction every year. Newtechnologies and current business administration practices and tools are taught in seminars attended by theCompany’s executives, which are organised by universities and specialised institutions in Greece and abroad.Thus, the Company enriches its knowledge and skills, while at the same time opening up new careeropportunities for its employees. Aiming at the ongoing development of its executives, HELLENIC CABLES alsofinances postgraduate programmes, thus enabling them to expand their knowledge and ensure their overalldevelopment in the Company.

In 2011, the entire Group’s personnel numbered 1,275 persons, registering a 23% increase due to theacquisition and incorporation of FULGOR.

The Company’s human resources are further detailed in the report on corporate responsibility and sustainabledevelopment.


7. Corporate Responsibility and Sustainable Development

HELLENIC CABLES has incorporated Corporate Responsibility in its operations. The Company acknowledgesthat the path towards Sustainable Development is inextricably linked with Corporate Responsibility and for thisreason it ascribes top priority to the systematic management of such issues. Respect for the environment andpeople are key values and priorities for HELLENIC CABLES.

HELLENIC CABLES has set the following pillars of Corporate Responsibility and Sustainable Development:

8

Economic

Development and

correct Corporate

Governance

Responsibili

ty towards the

Responsibilitytowards employeesand the Society

Responsibilitytowards theEnvironment

Economic Development and correct Corporate Governance

The primary goal of HELLENIC CABLES is to create value for its shareholders and associated parties, includingstakeholders. Through its business activities, HELLENIC CABLES contributes to the national economy whileit sets the foundation for attaining Sustainable Development through its annual investments. At the sametime, the correct corporate governance practices implemented by HELLENIC CABLES constitute a stabilityand outlook factor.


Responsibility towards the Market

The primary orientation and comparative advantage of HELLENIC CABLES lies in the manufacture of productswhich offer high quality and reliability, and maximum safety. The Company complies with and applies the ISO9001certified Quality Management System in all its managerial and operational activities. Since customersatisfaction is a key priority, the company invests significantly in research for the development of newtechnologies and in widening the range of its products.

Moreover, HELLENIC CABLES pursues the promotion of Corporate Governance throughout its supply chain.The Company’s policy requires all its suppliers to have an ISO 14001:2004 certified EnvironmentalManagement System.

Responsibility towards employees and the Society

We invest on human resources being aware that “our people” are the driving force towards HELLENIC CABLES’development and successful performance. The Company’s work environment is characterised by meritocracyand equal opportunities for all employees.

Our priority is the Health and Safety of our employees. The Company commits to making its best efforts toprovide a safe work environment that will ensure and promote the health and prosperity of its employees.Health and Safety is everybody’s concern!

HELLENIC CABLES recognises the importance of social contribution, particularly in the local communities inwhich it operates. With the public interest in mind, the Company schedules and implements actions incollaboration with local and regional authorities.

Responsibility towards the Environment

Environmental management is a basic part of corporate governance for HELLENIC CABLES. The Company iscommitted to reducing the environmental impact of its operations as respect for the environment is one of itsmain values. Aiming at integrated environmental management and proving in practice its commitment to protectthe environment, the Company implements an ISO 14001:2004 certified Environmental Management System atthe plants in Thiva, Oinofyta and Levadia.

Details on the Company’s actions per pillar of Corporate Responsibility are set out in the 2011 Corporate Responsi-bility and Sustainable Development Report of HELLENIC CABLES, which is a separate part of this Report.

8. Products

HELLENIC CABLES produces all types of power cables, overhead copper and aluminium conductors, telecommu-nications cables (copper and optical), plastic and rubber compounds as well as enamelled wires, being the onlyproducer of such wires in Greece. In brief, the Company’s product categories are:

Power cables• Indoor installation cables• Control cables• Industrial and outdoor installation cables• Fire-retardant, fire-resistant, halogen-free cables• Medium voltage cables• High and Extra-High Voltage cables (up to 400KV)• Cu (grounding), Al, ACSR conductors• Marine cables• Medium voltage submarine cables

Telecommunication and data transmission cables• Copper conductor cables

• Gauging and control cables• Conventional telephone cables• Telephone exchange cables• Data transmission tables• High-frequency telephone cables

Optical fibre cables (single-mode and multi-mode)• Underground dielectric cables, in tubes• Underground direct burial cables

(steel reinforcement)• Indoor installation LSZH cables• Underground dielectric anti-rodent cables• Aerial installation cables (8-shaped or ADSS)

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Signalling and railway signalling cables

Enamelled wires• Enamelled winding wires for electric motors and

transformers• Copper wires for grounding and box can

manufacture

Plastic & rubber compounds• PVC-based plastics• Polyolefin-based plastics• Rubbers

Main Company product applications:

Cables• Buildings• Outdoor installations and industrial applications• Transmission and distribution networks• Installations with special requirements

• Ship and marine applications• Telecommunications and data

transmission networks• Renewable energy sources

Enamelled Wires• Transformers• Motors - generators• Small motors• Relays - coils• Self-supporting windings -

resistance to varnish impregnation

Compounds• Cable industry• Production of soft water pipes• Production of flexible spiral pipes• Production of hard flexible pipes

for electrical applications• Rubber and plastic soles• Flexible elastic and plastic profiles

Cable products are sold in the Greek and international markets under the patented trademark CABLEL, whilethe trade name FULGOR is used for certain products manufactured by the same company. The Company is well-known in foreign markets and its orientation towards exports is a strategic choice made by the Managementas shown by the large quantities of cables and enamelled wires sold abroad.


9. Customers and Sales Network

HELLENIC CABLES SA sells its products in the domestic market through its central distribution centres in Athensand Thessaloniki and through its agent on the island of Crete, where there are properly organised warehouses. The Company participates directly in tenders held in Greece (e.g. PPC tenders) and in foreign countries. It ex-ports its products both directly and through agents. To ensure a more effective penetration in foreign markets,the Company uses the organised commercial network of VIOHALCO, including TEPRO METAL in Germany,GENECOS in France, METAL AGENCIES in England, STEELMET in Bulgaria and ICME ECAB in Romania. Its sub-sidiary Metal Globe operates in Serbia and there are local agents in the Cyprus and Middle East markets.

Power transfer cable customers include large power generation and transmission organisations such as EDFin France and ENEL in Italy, large construction & industrial companies, as well as globally famous cable tradingcompanies with international customers.


10. Plants and Manufacturing Process

The production base of HELLENIC CABLES Group includes plants in Greece and Romania as follows:

HELLENIC CABLES Power & Optical Fibre Plant (Thiva)

Total Area: 175,082 square metresBuildings: 38,265 square metresCapacity: 60,000 tonnes per year Products: Low, medium, high and extra-high voltage

power cables, optical fibre cables, copper andaluminium conductors.

Certifications: EN ISO 9001:2008, EN ISO 14001:2004

HELLENIC CABLES Enamelled Wire Plant (Livadeia)

Total Area: 121,818 square metresBuildings: 14,048 square metresCapacity: 14,000 tonnes per year Products: Enamelled copper and aluminium wires,

copper wires Certifications: EN ISO 9001:2008, EN ISO 14001:2004

HELLENIC CABLES Compound Plant (Oinofyta)

Total Area: 22,032 square metresBuildings: 6,444 square metresCapacity: 24,000 tonnes per year Products: Plastic & rubber compoundsCertifications: EN ISO 9001:2008, EN ISO 14001:2004

FULGOR Power Cables Plant (Sousaki, Korinthia)

Total Area: 206,465 square metresBuildings: 75,305 square metresCapacity: 50,000 tonnes cable and 120,000 tonnes 8mm

wire, per yearProducts: Low, medium, and high voltage power cables,

medium voltage submarine cables, 8mm cop-per wire

Certifications: EN ISO 9001:2008, EN ISO 14001:2004

14

Power Networks & Industrial Applications

ICME Power and Telecommunications Cable Plant (Bucharest)

Total Area: 268,000 square metresBuildings: 70,000 square metresCapacity: 50,000 tonnes per year Products: Low and medium voltage power cables, copper

telephone cables Certifications: EN ISO 9001:2008, EN ISO 14001:2004

11. Indicative Main Product Manufacturing Process

➢ Power Cables Installations’


Drawing (Wire Making)

Stranding(making theconductor)

Laying Up(Insulated

Conductors)

QualityControl

QualityControl

Sheath BArmouringSheath ALaying Up(Insulated

Conductors)Shielding Insulation

Stranding(making theconductor)

Drawing (Wire Making)

Sheath Insulation

➢ Telecommunications Cables Optical

Optical FibreColourCoding

OpticalFibre

InsulationReinforcement Quality

ControlSheath Twisting

Copper Telephone Cables

QualityControl

Sheath BArmouringSheath AShielding Laying UpTwinningInsulation Reduction

(Wire Making)

➢ Enamelled Wires

Reduction(Wire Making) Annealing Curing Quality

Control

Applicationof

Lubricant

VarnishCoating

12. Key Group Financial Data

Income Statement

CONSOLIDATED FIGURES (in euro million) 2011 2010 Change %Sales 415 351 18%Net earnings before interest, taxes, depreciation 20.9 13.2 58%and amortisation Percentage of sales 5.0% 3.8%Operating results 11.8 5.1 130%Percentage of sales 2.8% 1.5%Earnings before taxes 3.6 0.6 536%Percentage of sales 0.9% 0.2%Earnings after taxes 3.3 0.4 745%Percentage of sales 0.8% 0.1%

Balance Sheet

Group Balance sheet (in euro million) 2011 2010 DifferenceIn AssetsFixed assets 155.1 90.4 72%Holdings & other long-term receivables 3.6 3.5 2%Non-current Assets 158.7 93.9 69%

Inventories 92.1 68.4 35%Trade receivables 56.4 71.3 -21%Cash & cash equivalents 19.0 11.8 61%Other current assets 19.9 15.8 26%Current assets 187.4 167.3 12%Total Assets 346.1 261.2 32%

Equity 116.1 104.7 11%

LiabilitiesLong-term loans 65.4 31.3 109%Short-term loans 105.4 82.9 27%Trade payables 32.9 30.0 10%Other liabilities 26.3 12.3 114%Total Liabilities 230.0 156.5 47%Total Equity & Liabilities 346.1 261.2 32%

16

Cash flows

Group2011 2010

Operating activities -3.4 -14.4Investment activities -11.2 -4.6Financing activities 21.7 19.5Cash and cash equivalentsAt the beginning of the period 11.8 11.5At the end of the period 19.0 11.8

Financial ratios

GROUP2011 2010

Gross profit margin 6.5% 5.9%(Gross profit/ sales)Net profit margin 0.8% 0.1%(Net profit/ Sales)Gearing 1.47 1.09Debt/ EquityLiquidity 1.25 1.40(Current assets/ short-term liabilities) Return on Equity 2.9% 0.4%(Net profit/ Equity)Inventory turnover ratio 87 75(Inventory/ Cost of sales) x 365 daysAccounts receivable turnover ratio 50 74(Trade receivables/ Sales) x 365 daysAccounts payable turnover ratio 31 33(Trade payables/ Cost of sales) x 365 days


13. Share performance

Average price per share 2011 Euro 1.26 Number of shares 29,546,360

Share ticker symbols

Ticker symbol in ASE: ELKATicker symbol in Reuters: HCAr.AT Ticker symbol in Bloomberg: ELKA:GA

The company is listed in ASE General index and in the FTSE Mid Cap index.

2011 SHAREHOLDER COMPOSITION OF HELLENIC CABLES

18

HALCOR S.A. 72,53%27,47%

Free Float

DAILY PERFORMANCE OF HELLENIC CABLES SHARE PRICE IN 2011

0

10.000

20.000

30.000

40.000

50.000

70.000

80.000

90.000

0

0.2

0.4

0.6

0.8

1

1.2

1.4

1.6

1.8

2

1/3/112/3/11

3/3/114/3/11

5/3/116/3/11

7/3/118/3/11

9/3/1110/3/11

11/3/1112/3/11

14. Main holdings

The Company’s holdings which are consolidated include twelve companies, six of them being consolidatedwith the full consolidation method and the other six with the equity method of accounting:

Turnover Profit (Loss) Company Holding Registered Office (euro thousand) (euro thousand)1. ICME-ECAB SA 98.59% Bucharest 152,841 2,7132. FULGOR SA 100.00% Athens 19,046 (1.293)3. LESCO OOD 100.00% Sofia 3,655 2234. GENECOS SA 60.00% Paris 11,724 645. LESCO ROMANIA SA 65.00% Bucharest 268 76. DE LAIRE LTD 100.00% Nicosia 620 17. STEELMET SA 29.56% Athens 14,969 1578. METAL AGENCIES Ltd. 33.00% London 99,200 (75)9. ΜETAL GLOBE DOO 30.00% Belgrade 100 (144)10. EDE SA 99.99% Athens - (9)11. COPPERPROM Ltd. 40.00% Athens 42 (3)12. ELECTRIC CABLES AGENCIES 100.00% London - -

14.1 ICME ECAB S.A.

The Company has over 50 years experience in the Romanian and international cable markets. It was es-tablished in 1949 under the name ‘Electrocablu’. In 1959 Electrocablu merged with the neighbouring Com-pany ‘Electroizolantul’ to from the Company ‘Cables & Insulating Materials Factory’. In 1973 the Companywas renamed into ‘Cables & Insulating Materials Company’ (ICME). In 1998 the Austrian Company ISOVOLTAbecame its main shareholder. In 1999 HELLENIC CABLES SA acquired the majority of shares (95%) of ICME- ECAB SA and in 2002 it acquired almost full control of its share capital (98.6%). The Company is establishedin Bucharest, in a 70,000-m2 industrial complex in a 268,000-m2 plot of land and employs approximately570 employees.

The products of ICME - ECAB SA are sold in the international and Romanian markets under the patentedtrade mark CABLEL. The Company manufactures indoor installation cables, power cables, control cables,industrial and exterior installation cables, fire retardant cables, fire resistant cables, halogen-free cables,copper and aluminium conductors, mine cables, ship cables, special purpose cables, telecommunicationscables, signalling cables, remote control and data transmission cables, as well as plastic and rubber com-pounds.


It also has a Research & Development Department equipped with state-of-the-art machineryand well trained personnel, which contributes to the ongoing efforts to improve the quality andcost of its products.

ICME-ECAB SA invests constantly in human resources, by providing ongoing training and ensur-ing working conditions that are of superior quality and increased safety.

ICME-ECAB S.A.

Key Financials (in million euro) 2011 2010 % DifferenceSales 152.8 123.2 24%Gross Profit 8.8 4.9 82%Earnings before taxes 3.0 0.5 479%

Non-current Assets 18.8 19.3 -3%Current assets 71.7 60.0 19%Equity 39.0 36.3 7%Liabilities 51.5 43.0 20%

In the domestic Romanian market, products of ICME ECAB are sold and distributed from itsfacilities in Bucharest and its warehouses in Cluj, Bacau and Timisoara; in the internationalmarkets, they are sold through the network of HELLENIC CABLES S.A., including TEPRO METALin Germany, GENECOS in France, METAL AGENCIES in England, STEELMET in Bulgaria, ordirectly to end customers. Over the next years, the Company aims at further consolidation ofits presence in the Romanian market and in the markets of adjacent countries (Bulgaria,Hungary, Moldavia, Czech Republic, and Slovakia) and in other countries through the networkof HELLENIC CABLES S.A.

14.2 FULGOR S.A.

FULGOR was established in 1957. In 1972 the company relocated to its current facilities of206,000 m2 in Sousaki, Korinthia. In 1973 it implemented the first submarine cable links for PPCand in 1986 it constructed and installed the first optical fibre cable in Greece for OTE. Productionof high voltage cables started in 1993. Over the past forty years, the company has installed alarge part of the power and telecommunications networks in Greece and has installed mostsubmarine links in the Greek territory.

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FULGOR was included in the conciliation procedure provided by article 99 of the Bankruptcy Code in December2010. Aiming to ensure FULGOR's survival and welfare, HELLENIC CABLES carried out negotiations withFULGOR’s creditors which led to renegotiation of its bank loan and suspension of debt, as referred to in detailin the annual financial report. Impairment of fixed assets was carried out after acquisition, so they could beassessed at current value. The result of the aforementioned actions was that FULGOR was relieved of excessiveburdens and enter the recovery path .

FULGOR can produce overhead, underground and submarine low, medium, high and extra-high power cablesof various types and 8mm copper wire. The company’s products are sold in the Greek and internationalmarkets under the trade name FULGOR, with significant brand recognition especially with respect tosubmarine and high voltage cables. The company holds ISO 9001 certification since 1994, while in 2003 it alsoreceived ISO 14001 certification.


FULGOR S.A.

Key Financials (in million euro) 2011 2010 % DifferenceSales 19.6 17.0 15%Gross Profit (2.6) (14.7)Profit/ (Loss) before taxes (3.9) (27.4)

Non-current Assets 55.9 94.6 -41%Current assets 19,4 5,0 291%Equity 4,7 (4.7)Liabilities 70.6 104.2 -32%

FULGOR SA Financials. FULGOR SA is consolidated in the Financial Statements of HELLENIC CABLES startingon 1/8/2011.

FULGOR SA products are sold either directly or through the HELLENIC CABLES sales network in Greece (Athens,Thessaloniki, Crete) and abroad.

14.3 GENECOS S.A.

HELLENIC CABLES S.A. holds the majority (60%) of shares of the Paris-based Company GENECOS S.A. TheCompany distributes VIOHALCO products in France. In 2011, sales rose by 6% amounting to euro 11.7 millionwhereas the Company registered profits of approximately euro 64,000. Equity increased by 14% amountingto euro 510,000 while liabilities increased by 18% amounting approximately to euro 2.8 million.

14.4 METAL AGENCIES S.A.

The London-based Company focuses, among other things, on the trade of metal raw materials and theprovision of financial services. HELLENIC CABLES SA has got a 33% holding in the Company, and thus the latteris consolidated with the equity method of accounting.

In 2011, company sales amounted to British Pounds 82,862, registering a 6% increase compared to 2010, whilelosses of British Pounds 62,000 were incurred. Liabilities increased by 22% to British Pounds 17,962 (pertainingmainly to debts to Group companies), while the Company’s equity dropped by 12% to approximately BritishPounds 476,000.

22

15. Board of Directors & Company Management

The Company is governed by a 12-member Board of Directors:

1. Ioannis Batsolas, Chairman, executive member2. Konstantinos Laios, Vice-chairman, non-executive member3. Alexios Alexiou, executive member4. Michael Diakogiannis, non-executive member5. Andreas Katsanos, non-executive member6. Andreas Kyriazis, non-executive and independent member7. Nikolaos Galetas, non-executive and independent member8. Georgios Stergiopoulos, executive member9. Ronald Gee, non-executive member10.Rudolf Wiedenmann, non-executive member11. Iakovos Georganas, non-executive member12. Ioannis Stavropoulos, executive member

The Company is managed by Messrs.:

1. Alexios Alexiou, General Manager, Economist2. Ioannis Theonas, CFO, Economist3. Christos Siaperas, Cable Sales Manager, Mechanical - Electrical Engineer4. Dimitrios Chatzakis, Enamelled Wires Sales Manager, Economist5. Ioannis Papaioannou, Thiva Plant Manager, Mechanical Engineer6. Haralampos Voulgaris, Compounds Plant Manager, Chemical Engineer7. Ioannis Skondras, Livadia Plant Manager, Mechanical Engineer8. Constantinos Constantinou, Quality Manager, Mechanical - Electrical Engineer


16. Notice of General Meeting of Shareholders

Notice of Annual General Meeting to the Shareholders of “HELLENIC CABLES, S.A. HELLENIC CABLE INDUSTRY,S.A.”, S.A. Registration number 2131/06/Β/86/19

In compliance with the provisions of the Law and the Articles of Association of the Company, the Shareholdersof HELLENIC CABLES, S.A. HELLENIC CABLE INDUSTRY, S.A. are hereby invited, by the Board of Directors, to attendthe Company's Annual General Meeting, to be held on Friday, June 29, 2012 at 10:00 AM, at the PRESIDENTHotel, 43, Kifissias Avenue, Athens, to discuss and decide on the following:

AGENDA

1. To approve the annual financial statements for the Company's financial year ended on December 31, 2011and the relevant Directors and Auditors Reports.

2. To discharge the Directors and the Auditors from all responsibility for damages for the financial year 2011.3. To appoint Certified Auditors, as well as their alternates for the financial year 2012 and set their remuneration.4. To elect the members of a new Board of Directors.5. To appoint the members of the inspection committee, according to the article 37 of Law 3693/2008.6. To approve Directors’ remuneration, according to the article 24, par. 2 of Codified Law 2190/1920.7. To issue common debenture loans.8. Miscellaneous announcements.

RIGHT TO ATTEND THE GENERAL MEETINGAnybody appearing as a shareholder in the file of the Dematerialised Securities System, managed by ‘HELLENICEXCHANGES SA’ (former Central Securities Depository), in which the company’s shares are kept has the right toattend the General Meeting. A certificate in written form issued by the above entity should be used as proof ofthe capacity to act as a shareholder, or alternatively the direct access to the electronic files of the entity. Thiscapacity should exist on 24.06.12 (Registration date), namely at the beginning of the fifth (5th) day before thedate of the General Meeting and the pertinent written certificate, regarding the capacity of shareholder, has toreach the company by 26.06.12 at the latest, namely on the third (3rd) day before the day of the General Meeting.

The company considers as a shareholder having the right to attend the General Meeting and vote only whoeverhas the capacity as a shareholder on the respective Registration Date. In the case of non-compliance with theprovisions of the article 28a of Codified Law 2190/1920, the shareholder in question can only attend the GeneralMeeting with its permission.

To exercise the rights in question does not presuppose that the shares of the beneficiary should be blocked oranother similar procedure should be followed, limiting the possibility for sale and transfer of the shares duringthe period of time between the Date of Registration and the General Meeting.

PROCEDURE TO BE FOLLOWED IN ORDER TO EXERCISE VOTING RIGHTS THROUGH A PROXYThe shareholder attends the General Meeting and votes in person or through proxies. Each shareholder can

24

appoint up to three (3) proxies. Legal entities can attend the General Meeting by appointing up to three (3)natural persons as their proxies. Nevertheless, in the case the shareholder holds shares of a company appearingin more than one securities account, the above restriction does not prevent the shareholder from appointingdifferent proxies for the shares appearing in each securities account in respect with the General Meeting. Aproxy acting on behalf of more shareholders can vote differently with respect to each shareholder. The proxyof a shareholder has to inform the company, before the General Meeting starts, about any specific fact, whichcan be useful to the shareholders for the estimation of the risk, regarding the fact that the proxy could servethe interests of other parties, other than those of the shareholder. According to the present paragraph a conflictof interests could happen especially when the proxy:a) Is a shareholder controlling the company or another legal body or entity, which is controlled by this

shareholder.b) Is a member of the Board of Directors or the Company’s management, in general, or a shareholder, who

exercises control of the Company or other corporal body or entity controlled by a shareholder, who exercisescontrol over the company.

c) Is an employee or certified auditor of the company or a shareholder having control of the company or otherlegal body or entity controlled by a shareholder, who has control of the company.

d) Is married to or a first degree relative of one of the natural persons mentioned in cases (a) to (c).

The appointment or recalling of the shareholder’s proxy is executed in writing and notified to the Company,through the same procedure, at least three (3) days before the date of the General Meeting.

The company will make available in its website www.cablel.gr. the form to be used for the appointment of a proxy.This form, must be submitted filled and signed by the shareholder to the Company’s Investors Relations Serviceat the address: 16 Himaras street, 15125 Maroussi or sent by fax at: 210 6861347 at least three (3) days before theday of the General Meeting. The appointed proxy is required to confirm successful delivery of the proxyappointment form to the company over the phone at 210 6861349, Mr. Konstantinos Kanellopoulos.

Each share issued by the Company has one voting right.The Company’s Articles of Association do not provide the possibility to attend the General Meeting throughelectronic means, without the natural presence of the shareholders in the place where the meeting is held or thepossibility to participate in long distance voting.

MINORITY SHAREHOLDERS RIGHTSAccording to the provisions of article 26 of Codified Law 2190/1920, as it is in force today, the Company informsits shareholders on the following:a) Following an application of shareholders representing 1/20 of the company’s paid up share capital the

company’s Board of Directors has the obligation to include additional items in the Agenda, if the pertinentapplication reaches the Board by 14/06/2012 namely at least fifteen (15) days before the General Meeting.The application for the registration of additional items in the Agenda should be accompanied by a relevantjustification or a draft resolution for approval by the General Meeting. The revised Agenda is published inthe same way as the previous agenda, namely on 16.06.12, thirteen (13) days before the date of the GeneralMeeting and at the same time it is made available to the shareholders at the company’s website together


with the justification and the draft decision submitted by the shareholders, according to the provisions ofart. 27 par. 3 of Codified Law 2190/1920.

b) Following an application of shareholders representing 1/20 of the paid up share capital, the Board ofDirectors makes available to the shareholders, according to the provisions of art. 27 par. 3 of Codified Law2190/1920, at the latest by 23.06.12 namely six (6) days before the date set for the General Meetings to beheld, the draft resolutions regarding the items included in the initial or the revised agenda, if the applicationreaches the Board of Directors by 22.06.12 namely at least seven (7) days before the date of the GeneralMeeting.

c) Following an application submitted to the Company by any shareholder by 23.06.12, namely at least five(5) full days before the General Meeting, the Board of Directors has to provide to the General Meeting thespecific information requested, regarding the Company’s affairs, at the extent that those could be useful toa substantial assessment of the items of the agenda.

The Board of Directors can provide a uniform answer to the request of shareholders having the samecontents. There is no obligation to provide information already available in the Company’s website,especially in the form of questions and answers.

In addition, following a request of shareholders, representing 1/20 of the paid up share capital, theBoard of Directors is obligated to announce to the General Meeting the amounts of remuneration paid,during the last two years, to each member of the Board of Directors or the managers of the Company,as well as any payment to the above persons for any reason or any contract between them and theCompany.

In all the above cases the Board of Directors can deny to provide the information, due to a substantialreason, which must be mentioned in the minutes.

d) Following an application of shareholders representing one fifth (1/5) of the paid up share capital, submitted

26

to the Company until 23.06.12 , namely at least five (5) days before the General Meeting, the Board ofDirectors should provide to the General Meeting information regarding the Company’s business affairs andassets. The Board of Directors can deny providing such information, due to a substantial reason, which mustbe mentioned in the minutes.

The above mentioned time limits to exercise the minority rights apply also to Repeat General Meetings.

In all the above mentioned cases, the shareholders submitting an application have to prove the fact that theyare shareholders of the Company and the number of shares they own, when they proceed to exercise theirrelative right. Such proof can be a certificate issued by the entity where the securities are kept or an attestationof the shareholder capacity with direct electronic contact between such entity and the Company.

AVAILABLE DOCUMENTS AND INFORMATION The information provided for in article 27 par.3 of Codified Law 2190/1920 (the text of the Notice for AnnualGeneral Meeting, the total number of the Company’s shares and the respective voting rights, comments of theCompany’s Board of Directors on the items of the agenda, the proxy appointment form) will be available inelectronic form, in the Company’s website, www.cablel.gr. Copies of the above documents will be available inthe offices of the Company’s Investors Relations Service, at the address:16, Himaras street, 15125 Maroussi.

Athens, 6 June 2012The Board of Directors


HELLENIC CABLE INDUSTRY S.A.

AnnualFinancialREPORT

as at 31 DECEMBER 2011

Based on Article 4 of Law 3556/2007

The Chairman A Member The General The Chief Financialof the BoD of the BoD Manager Officer

IOANNIS IOANNIS ALEXIOS IOANNIS BATSOLAS STAVROPOULOS ALEXIOU THEONASAK 034042 Κ 221209 Χ 126605 AE 035000

LICENCE No, CLASS A: 0011130

HELLENIC CABLE S.A.33, Amarousiou-Halandriou Av., Marousi, GR-15125

www.cablel.grCorp. Reg. No. 8246/06/B/11

Contents Page

A3A N N U A L F I N A N C I A L R E P O R T D E C E M B E R 2 0 1 1

Annual Company and Consolidated Financial Statements A4

Statements made by Representatives of the Board of Directors A7

Annual Report by the Board of Directos A9

Individual and Consolidated Statement of Financial Position A28

Individual and Consolidated Statement of Total Income A29

Consolidated statement of changes in equity A30

Individual statement of changes in equity A31

Individual and Consolidated Statement of Cash Flow A32

Audit Report by the Chartered Auditor Accountant A34

HELLENIC CABLES S.A.SA REGISTER No 2131/06/Β/86/19, Address: Athens Tower, Building B, 2-4, Mesogheion Avenue, 11527, Athens

Facts and information on the year from 1 January 2011 to 31 December 2011, (published pursuant to Article 135 of Codified Law 20/1920 on entities preparing annual financial statements, either consolidated or not, as per IAS)The following facts and data arising from the financial statements aim to provide general information about the financial condition and results of "HELLENIC CABLES S.A.". Therefore, readers are advised, before making any investment decision or other transaction with the company,

to refer to the company's website where the financial statements and the audit report of the chartered accountant-auditor are uploaded.

Competent Prefectur: Ministry of Development, S.A. and Credit Division, BoD composition: Chairman: Batsolas I., Vice-chairman: Laios K. and members: Diakogiannis M., Kyriazis A., Stergiopoulos G., Alexiou A., Katsanos A., Stavropoulos I., Galetas N., Georganas I., Gee Ronald, Wiedenmann Rudolf, Chartered Accountant - Auditor: Nikolaos Tsiboukas (Greek ICPA Reg. No: 17151),

Date of annual financial statements approval by the Board of Directors: 16 March 2012, Audit company: KPMG Certified Auditors A.E., Type of auditors' audit report: Upon concurrent opinion, Website: www.cablel.gr

SETS BALANCE SHEET ITEMSAmounts in euro

GROUP COMPANY

GROUP COMPANY

GROUP COMPANY

STATEMENT OF CHANGES IN EQUITYAmounts in euro

STATEMENT OF CASH FLOWAmounts in euro

ASSETSSelf-used tangible fixed assets 142,699,539 87,868,776 69,658,858 64,321,620Investment property 2,270,174 2,152,565 2,270,174 2,152,565Intangible assets 10,160,040 409,125 267,637 348,791Other non-current assets 3,589,188 3,500,184 23,424,121 22,712,776Inventories 92,165,783 68,392,515 45,580,792 38,355,431Trade receivables 49,588,685 60,205,112 54,669,585 46,812,944Other current assets 45,606,784 38,670,133 42,244,488 29,342,604________________ ________________ ________________ ________________TOTAL ASSETS 346,080,193 261,198,410 238,115,655 204,046,731________________ ________________ ________________ ________________________________ ________________ ________________ ________________EQUITY AND LIABILITIESShare Capital 20,977,916 19,330,716 20,977,916 19,330,716Other equity items 94,317,900 84,616,577 73,557,880 56,898,763________________ ________________ ________________ ________________Total equity of parent company owners (a) 115,295,816 103,947,293 94,535,796 76,229,479________________ ________________ ________________ ________________________________ ________________ ________________ ________________Minority Interests (b) 819,327 751,489 - - ________________ ________________ ________________ ________________Total Equity (c)=(a) + (b) 116,115,143 104,698,782 94,535,796 76,229,479________________ ________________ ________________ ________________________________ ________________ ________________ ________________Long-term loan liabilities 65,405,241 31,327,847 38,016,667 26,827,754Provisions/ Other long-term liabilities 14,224,768 5,554,247 6,713,081 5,048,521Short-term loan liabilities 105,352,490 82,889,865 56,882,150 51,680,841Other short-term liabilities 44,982,551 36,727,669 41,967,961 44,260,136________________ ________________ ________________ ________________Total liabilities (d) 229,965,050 156,499,628 143,579,859 127,817,252________________ ________________ ________________ ________________________________ ________________ ________________ ________________TOTAL EQUITY AND LIABILITIES (c) + (d) 346,080,193 261,198,410 238,115,655 204,046,731________________ ________________ ________________ ________________________________ ________________ ________________ ________________

Total equity at beginning of year (1/1/2011 and 1/1/2010 respectively) 104,698,782 104,595,323 76,229,479 76,012,516 Period earnings/(loss) after taxes 3,331,054 394,245 1,094,657 (173,891)Net income posted directly to equity (1,508,614) (290,786) (1,488,237) 390,854 Share capital increase 9,593,921 9,593,921 - Absorption of subsidiary - - 9,105,976 - ________________ ________________ ________________ ________________Total equity at end of year (31.12.2011 and 31.12.2010 respectively) 116,115,143 104,698,782 94,535,796 76,229,479 ________________ ________________ ________________ ________________________________ ________________ ________________ ________________

Operating ActivitiesEarnings before taxes (continuing activities) 3,609,474 567,744 1,640,885 38,690 Plus/ less adjustments for:Depreciation and Amortization 9,369,472 8,120,982 5,423,385 5,135,175 Provisions (400,892) (52,725) 490,349 425,100 Results (income, expenses, profit and loss) from investment activity 406,424 (1,002,746) 306,127 (1,520,423)Depreciation of grants (335,125) (36,516) (335,125) (36,516)Interest charges and related expenses 9,238,165 4,801,210 6,142,823 3,153,777 Plus/less adjustments for changes in working capital accounts or accounts related to operating activities:Decrease/(increase) in inventories (21,798,420) (8,779,230) (7,187,237) (3,037,832)Decrease/(increase) in receivables 20,049,435 (21,553,603) (1,681,101) (16,121,381)(Decrease)/ increase in payables (less loans) (14,103,008) 8,343,889 (3,374,328) 9,220,465 Less:Interest charges and related paid-up expenses (8,972,995) (4,656,228) (5,877,652) (3,008,795)Taxes paid (413,446) (170,095) (184,323) (158,629)________________ ________________ ________________ ________________Total inflow / (outflow) from operating activities (a) (3,350,916) (14,417,318) (4,636,197) (5,910,369)________________ ________________ ________________ ________________________________ ________________ ________________ ________________Investment activitiesAcquisition of subsidiaries, affiliated companies, joint ventures and other investments (3,114,495) - (3,430,000) - Purchase of tangible and intangible assets (8,263,290) (5,437,898) (5,158,263) (4,023,209)Proceeds from the sale of tangible and intangible assets 85,870 5,623 85,870 105,621 Absorption of subsidiary - - 287,942 - Interest received 116,563 258,542 211,116 19,234 Dividend received - 557,641 - 557,641 ________________ ________________ ________________ ________________Total inflow / (outflow) from investment activities (b) (11,175,352) (4,616,092) (8,003,335) (3,340,713)________________ ________________ ________________ ________________________________ ________________ ________________ ________________Financing activitiesProceeds from issued / received loans 106,421,745 68,545,083 54,223,554 36,305,220 Repayment of loans (85,442,316) (49,038,797) (37,833,332) (21,743,880)Payment of financial lease payables (amortization) (109,648) - - - Grants received 827,475 - 827,475 - ________________ ________________ ________________ ________________Total inflow/ outflow from financing activities (c) 21,697,256 19,506,286 17,217,697 14,561,340 ________________ ________________ ________________ ________________________________ ________________ ________________ ________________Net increase / (decrease) in cash & cash equivalents for the year (a)+(b)+(c) 7,170,988 472,876 4,578,165 5,310,258 ________________ ________________ ________________ ________________________________ ________________ ________________ ________________Cash & cash equivalents at the beginning of the year 11,820,842 11,458,232 7,984,168 2,673,910 ________________ ________________ ________________ ________________________________ ________________ ________________ ________________Effect of foreign exchange differences (8,451) (110,266) - - ________________ ________________ ________________ ________________________________ ________________ ________________ ________________Cash & cash equivalents at the end of the year 18,983,379 11,820,842 12,562,333 7,984,168 ________________ ________________ ________________ ________________________________ ________________ ________________ ________________

31 Dec 11 31 Dec 10 31 Dec 11 31 Dec 10

31 Dec 11 31 Dec 10 31 Dec 11 31 Dec 10

1.01 - 31.12.2011 1.01 - 31.12.2010 1.01 - 31.12.2011 1.01 - 31.12.2010

A4 H E L L E N I C C A B L E S H E L L E N I C C A B L E I N D U S T R Y S . A .

HELLENIC CABLES S.A.Facts and information on the year from 1 January 2011 to 31 December 2011, (published pursuant to Article 135 of Codified Law 20/1920 on entities preparing annual financial statements, either consolidated or not, as per IAS)

Turnover 414,593,446 351,883,981 326,655,026 257,628,647 ________________ ________________ ________________ ________________Gross profit/ (loss) 26,887,939 20,269,181 17,001,312 11,330,822 ________________ ________________ ________________ ________________________________ ________________ ________________ ________________Earnings/ (loss) before interest and taxes 11,815,860 5,139,862 7,853,057 2,322,988 ________________ ________________ ________________ ________________Earnings /(loss) before taxes 3,609,474 567,744 1,640,885 38,690 ________________ ________________ ________________ ________________________________ ________________ ________________ ________________Less taxes (278,420) (173,499) (546,228) (212,581)Earnings/(loss) after taxes (A) 3,331,054 394,245 1,094,657 (173,891)________________ ________________ ________________ ________________________________ ________________ ________________ ________________Allocated to:Company Shareholders 3,262,533 373,691 1,094,657 (173,891)Minority Shareholders 68,521 20,554 - -Other total income after taxes (B) (1,508,614) (290,786) (1,488,237) 390,854 Comprehensive total income after taxes (A)+(B) 1,822,440 103,459 (393,580) 216,963 ________________ ________________ ________________ ________________________________ ________________ ________________ ________________Allocated to:Company Shareholders 1,754,601 93,358 (393,580) 216,963 Minority Shareholders 67,839 10,101 - -Basic post-tax earnings/ (loss) per share (in euro) 0.1167 0.0140 0.0391 (0.0060)________________ ________________ ________________ ________________________________ ________________ ________________ ________________Earnings/ (loss) before interest, taxes, depreciation and amortization 20,850,207 13,224,328 12,941,317 7,421,647 ________________ ________________ ________________ ________________________________ ________________ ________________ ________________

Additional facts and information:The Group companies included in the consolidated financial statements Holding Registered Office Unaudited with reference to registered offices and holding percentage are as follows: Direct Indirect Total years

Full consolidation method:FULGOR Α.Ε. 100% - 100% GREECE 2011ICME ECAB S.A 98.59% - 98.59% ROMANIA 2010-2011LESCO O.O.D 99.15% 0.85% 100% BULGARIA 2009-2011GENECOS S.A 60% - 60% FRANCE 2005-2011LESCO ROMANIA S.A 65% - 65% ROMANIA 2003-2011DE LAIRE LIMITED 100% - 100% CYPRUS 2001-2011Using the equity method of accounting:ΣΤΗΛΜΕΤ Α.Ε 29.56% - 29.56% GREECE 2006-2011METAL AGENCIES LTD 33% - 33% ENGLANDMETAL GLOBE DOO 30% - 30% SERBIA 2003-2011ΕLECTRIC CABLE AGENCIES 100% - 100% ENGLAND -COPERPROM ΕΠΕ 20% 20% 40% GREECE 2003-2011Ε.Δ.Ε Α.Ε 99.99% - 99.99% GREECE 2010-2011Using the proportional consolidation method:JOINT VENTURE NEXANS–HELLENIC CABLES–FULGOR–PPC 2009 33% - 33% GREECE 2009-2011

2. On 29 July 2011, the parent company acquired 100% of the shares of the relevant company in the cables sector, Fulgor SA. In addition, the parent company absorbed its wholly-owned subsidiaryTELECABLES SA. Further information on such acquisition and absorption is provided in Notes 7 and 8 to the Financial Statements. For comparability purposes of the Consolidated Financial Statements ofthe year, proforma Consolidated Financial Statements were prepared as if the acquisition had taken place on 31 December 2010 (Note 37).

3. On 7 September 2011, the General Meeting of the Company's shareholders decided to increase the share capital which was completed on 7 February 2012. The share capital increase and share premiumaccount stood at euro 9,593,921 through the issue of 2,320,000 new ordinary registered shares.

4. Prenotation of mortgage totalling euro 49 million has been raised on the properties of the subsidiary FULGOR to secure long-term loans.5. No shares of the parent company are held by Group companies.6. The Company has been audited by the tax authorities up to 2008. As for the unaudited fiscal years 2009 and 2010, a provision equal to euro 200,000 has been raised to meet any contingent additional

tax liabilities. As for the year 2011, the Company is audited by KPMG audit firm in the context of the issue of the tax certificate according to the provisions of Article 82(5) of Law 2238/1994, as amendedby Decision No. 1159/22-7-2111 of the Minister of finance.

7. The personnel employed by the Company and the Group on 31 December 2011 numbered 401 and 1,275 respectively and on 31 December 2010 the corresponding figure was 405 and 1,035.8. There are no disputed cases against Group companies and, thus, no relevant provisions have been raised.9. Cumulative income and expenses from beginning of the accounting period and balances of receivables and payables of the Company and the Group at the end of the current period, which have arisen

from its transactions with affiliated parties as per IAS 24, are as follows:(Amountsineuro) GROUP COMPANYi) Income 32,743,693 67,046,016 ii) Expenses 70,086,233 76,160,782 iii) Receivables 6,814,584 27,116,307 iv) Payables 7,026,544 21,735,068 v) Transactions with and fees for Management executives and members 841,601 618,750 vi) Receivables from Management executives and members - - vii) Payables to Management executives and members - -

10. Certain items of the Group's results of the year 2010 have been reclassified to be similar and comparable with those of the current year. Detailed reference is made in Note 37 to the FinancialStatements.

11. The financial statements of the Group are included in the consolidated financial statements of the following companies:Corporate name Country of registered office Method of consolidation Holding percentageHALCOR S.A. GREECE FULL CONSOLIDATION 72.53%VIOHALCO S.A. GREECE FULL CONSOLIDATION 45.64%

12. The amounts and nature of other total income after taxes for the Group and the Company are as follows: GROUP COMPANY

(Amountsineuro) 31-Dec-11 31-Dec-10 31-Dec-11 31-Dec-10Foreign exchange differences 386,346 (1,216,680) - -Valuation of derivatives fair value (2,419,247) 987,422 (1,935,054) 486,644 Proportionate tax 524,287 (61,528) 446,817 (95,790)Other total income after taxes (1,508,614) (290,786) (1,488,237) 390,854

GROUP COMPANYINCOME STATEMENTAmounts in euro 1.01 - 31.12.2011 1.01 - 31.12.2010 1.01 - 31.12.2011 1.01 - 31.12.2010

Athens, 16 March 2012

THE CHAIRMAN OF THE BoD A MEMBER OF THE BoD THE GENERAL MANAGER THE CHIEF FINANCIAL OFFICERIOANNIS BATSOLAS IOANNIS STAVROPOULOS ALEXIOS ALEXIOU IOANNIS THEONAS

AK 034042 Κ 221209 Χ 126605 AE 035000LICENCE No, CLASS A: 0011130

To the best of our knowledge, we herebydeclare that the annual financial statementsdrawn up in line with the applicableaccounting standards (InternationalFinancial Reporting Standards) give a fairview of the assets and liabilities, equity andoperating results of HELLENIC CABLES S.A.(the Company) and of the entities included

in the consolidation taken as a whole, andthat the annual report of the Board ofDirectors gives a fair view of thedevelopment, performance and standing ofthe Company and of the entities included inthe consolidation taken as a whole,including the description of the main risksand uncertainties facing them.


Chairman of the Board ofDirectors

Ioannis Batsolas

General Manager andMember of the

Board of Directors

Alexios Alexiou

Member of theBoard of Directors

Ioannis Stavropoulos

Statements made by Representatives of the Board of Directors(According to Article 4(2) of Law 3556/2007)



Dear Shareholders,

In accordance with the provisions laiddown in Laws No. 2190/1920 & 3556/2007and the executive decisions made by theHellenic Capital Market Commissionbased on those laws, we are happy tosubmit you the Annual Report by theBoard of Directors for the current fiscalyear 2011.

This Report includes a summary of thefinancial results and changes of the year,an account of important events that tookplace during 2011, an analysis of theprospects and risks expected during 2012,as well as a list of transactions withaffiliates. The above information pertainsboth to the Company and the Group.

In addition to Hellenic Cables - HellenicCables Industry S.A., Hellenic CablesGroup consolidates the followingaffiliates:

Using the acquisition method ofaccounting (full consolidation):• TELECABLES S.A., primary place of

business: Athens (until 01.08.2011,date of absorption)

• FULGOR S.A., primary place ofbusiness: Athens (as of 01.08.2011,date of acquisition)

• ICME Ecab S.A., primary place ofbusiness: Bucharest, Romania

• LESCO O.O.D., primary place ofbusiness: Blagoevgrad, Bulgaria

• GENECOS S.A., primary place ofbusiness: Paris, France

• LESCO ROMANIA, primary place ofbusiness: Bucharest, Romania

• DE LAIRE LIMITED, primary place ofbusiness: Nicosia

Using the equity method of accounting:• EDE S.A., primary place of business:

Athens• ELECTRIC CABLES AGENCIES, primary

place of business: London• METAL AGENCIES LTD, primary place of

business: London• METAL GLOBE DOO., primary place of

business: Belgrade• STEELMET S.A., primary place of

business: Athens• COPPERPROM LTD., primary place of

business: Athens

Using the proportional consolidationmethod:• JOINT VENTURE NEXANS–HELLENIC

CABLES–FULGOR–PPC 2009

There are no parent company sharesowned either by itself or by anotherconsolidated company.

1. Report on the ending yearFor Hellenic Cables Group, 2011 wasmarked by the acquisition of Fulgor S.A.,which is expected to contributesignificantly to the Group’s futureperformance, and by the improved resultsof the Group’s principal companies.

FULGOR S.A. (hereinafter Fulgor) hadfallen under the arrangement procedureof Article 99 of the code on bankruptcysince December 2010. To ensure thefuture survival and prosperity of FULGOR,HELLENIC CABLES S.A. undertook

ANNUAL REPORTBY THE BOARD OF DIRECTORS OF “HELLENIC CABLES S.A.”

ON THE CONSOLIDATED AND COMPANY FINANCIAL STATEMENTSFOR THE PERIOD FROM 1 JANUARY TO 31 DECEMBER 2011


negotiations with the creditors of Fulgor.In the context of such negotiations,HELLENIC CABLES reached an agreementwith the lending banks to which FULGORowed approximately euro 64 million.

Of the total bank debts, it was stipulatedthat FULGOR would issue a bond loanamounting up to euro 22 million, whichwould be repaid from funds contributed byHELLENIC CABLES S.A. to FULGOR througha share capital increase that would be fullysubscribed by HELLENIC CABLES. Thefunds to be contributed to FULGOR wouldarise from the share capital increase ofHELLENIC CABLES S.A. which would issue2,320,000 new shares to be fully takenexclusively by the banks. Thus, FULGORwould fully repay the above bond loanamounting up to euro 22 million andwould enter a phase of recovery.

The acquisition was completed on 29July 2011. On 7 September 2011, theGeneral Meeting of shareholders ofHellenic Cables decided to raise its sharecapital through abolition of the pre-emption right of the existing shareholders.The share capital increase stood at euro9,593,921 and was completed on 7February 2012. More specifically, 2,320,000new ordinary registered shares wereissued, which were taken over by thelending banks of Fulgor and whose tradingon the ASE started on 7 March 2012.

Such acquisition is expected to bolsterthe export orientation of HELLENICCABLES Group while also enriching theportfolio of products with high addedvalue cables such as energy submarinecables. In addition, the synergies that willarise among the sales networks, supplychain, production as well as research anddevelopment of new products areexpected to have a positive effect on the

Group’s financial results. By acquiringFULGOR, HELLENIC CABLES Groupbecomes one of the largest cable groupsin Europe.

Moreover, on 1 August 2011, theabsorption of TELECABLES S.A. by theparent HELLENIC CABLES S.A. wascompleted. Given that TELECABLES S.A.was a wholly-owned subsidiary on 31December 2011, the consolidated figuresof HELLENIC CABLES Group were notaffected in comparison with the previousfiscal year.

The Group’s turnover stood at euro 415million in 2011, registering a considerableincrease (18% compared to 2010) which isdue to the Group’s increased sales to othercountries and also to the consolidation ofthe new subsidiary. Fulgor’s sales duringthe period it was consolidated withHELLENIC CABLES Group stood at euro 19million and thus the effect on the Group’sturnover was minor.

In the Greek market, HELLENIC CABLESGroup maintained its leading position.However, the reduced demand due to thedrop in building activity and the strategyof credit risk decrease entailed decreasedsales by 13% compared to 2010.Approximately 3/4 of the Group’s sales inGreece were made to energy utilities,major industrial units and companies ofVIOHALCO Group.

In exports, increase in sales came to38%, as a result of the Group’s exportorientation despite the uncertainty in theinternational markets. The political andeconomic developments in the Arabcountries and also in the Europeancountries of the Mediterranean led todecreased demand in these markets and,by extension, to increased competition. In2011, exports accounted for 71% of the


Group’s total sales compared to 61% in2010.

The gross profits of the Groupamounted to euro 26.9 million, increasedby 29% compared to 2010. Earningsbefore interest, taxes, depreciation andamortization (EBITDA) stood at euro 20.9million, registering a 58% increasecompared to 2010, while earnings beforeinterest and tax (EBIT) amounted to euro11.8 million, being increased by 130%compared to 2010.

Such improvement of the results is dueto the increased sales and also to theimprovement in margins despite thefierce competition and upward trends ofraw materials, as a result of the increasedsales of added value products.

Group pre-tax results amounted toprofits of euro 3.6 million compared toeuro 568,000 in 2010 while net resultsstood at profits of euro 3.3 millioncompared to euro 394,000 in 2010.

The net borrowing of the Groupamounted to euro 152 million compared toeuro 102 million in 2010 due to theacquisition of Fulgor and the financing ofthe increased working capital. The Group

managed to reduce the collection time oftrade receivables while the days ofinventory keeping were raised due to thecreation of an initial operating inventory ofFulgor. The commercial working capital tosales ratio rose 28% in 2011 compared to31% in 2010, indicative of its focus on amore optimized management of workingcapital and the Group’s potential synergies,.

The investments made in 2010amounted to euro 8.1 million at Grouplevel and concerned mainly the purchaseof mechanical equipment in order toincrease the percentage of high addedvalue products in the product mix,improve productivity and enhance thecapacity of the Group's plants.

Finally, training as well as the healthand safety of employees are still coreelements of the Group's strategy togetherwith its commitment to operate driven bythe principles of responsible andsustainable development.

2. Financial positionThe ratios presenting the financialposition of the Group and the Companyare set out in the Table 1.1.

TABLE 1.1

GROUP COMPANY2011 2010 2011 2010

Gross profit margin 6.5% 5.9% 5.2% 4.4%(Gross profit/ (sales)Net profit margin 0.8% 0.1% 0.3% -0.1%(Net profit/ Sales)Debt-equity ratio 1.47 1.09 1.00 1.03(Debt/ Equity)Liquidity ratio 1.25 1.40 1.44 1.19(Current assets/ short-term payables)Return on Equity 2.9% 0.4% 1.2% -0.2%(Net profit/ Equity)Inventory turnover ratio 87 75 54 57(Inventory/ Cost of sales) x 365 daysReceivables turnover ratio 50 74 66 78(Trade receivables/ Sales) x 365 daysAccounts payable turnover ratio 31 33 43 59(Trade creditors/ Cost of sales) x 365 days


3. Credit RiskThe Group’s risk management policies areapplied in order to identify and analyzethe risks that the Group is exposed to, setrisk-taking limits and apply relevantcontrol systems. The risk managementpolicies and relevant systems areexamined from time to time so as to takeinto account any changes in the marketand the Group’s activities.

The implementation of riskmanagement policies and procedures issupervised by the Internal Auditdepartment, which performs ordinary andextraordinary audits relating to theimplementation of procedures, whereasthe results of such audits are notified tothe Board of Directors.

3.1 Credit riskCredit risk is the risk that the Group willincur loss if a client or third party to atransaction on a financial instrument failsto perform according to the terms andconditions laid down in the relevantcontract. Credit risk is mainly associatedwith receivables from clients andinvestments in securities.

3.1.1 Customers and other tradereceivables

The Group’s exposure to credit risk isaffected mainly by the characteristics ofeach individual customer. The statisticsassociated with customers such as thesegment and the country in which eachcustomer operates have a minor effect onthe Group’s overall credit risk since nohigh geographical concentration ofcustomers is noticed. During the fiscalyear, only one customer represented over10% of sales while its balance was kept ata considerably lower level than 10% of

trade receivables and, thus, the tradingrisk is allocated to a large number ofcustomers.

The Board of Directors has laid down acredit policy which requires that all newcustomers are scrutinized individually asregards their creditworthiness beforenormal payment terms are proposed tothem. The creditworthiness controlperformed by the Group includes anexamination of information from bankingsources and other third party credit ratingsources, if any. Credit lines are set forevery customer, and they are re-examinedin the light of current circumstances and,if required, the relevant sales and paymentterms are readjusted accordingly.

Customer credit lines are normallydetermined based on the insurance limitsobtained for them from insurancecompanies and then receivables areinsured based on such credit lines.

In monitoring customer credit risk,customers are grouped depending ontheir credit characteristics, the agingprofile of their receivables and theexistence of any possible previousdifficulties in collecting receivables. Anycustomers characterised as being of “highrisk” are included in a special list ofcustomers and future sales must bereceived in advance and approved by theBoard of Directors. According to thecustomer’s history and capacity, in orderto secure its receivables, the Grouprequests real guarantees or collateral (i.e.letters of guarantee), when possible.

The Group records a provision forimpairment, which represents itsestimated losses relating to customers,other trade receivables and investmentsin securities. The above provision includesmainly impairment losses relating to


specific receivables which, based on givenconditions, are expected to be incurred,but are not finalized yet.

3.1.2 InvestmentsInvestments are classified by the Grouppursuant to the purpose for which theywere acquired. The Management decideson the appropriate classification of theinvestment during the time such wasacquired and reviews the classification oneach presentation date.

3.1.3 GuaranteesThe Group’s policy requires that nofinancial guarantees are provided. By wayof exception, however, such guaranteescan be provided only to subsidiaries andaffiliates based on a resolution passed bythe Board of Directors.

3.2 Liquidity riskLiquidity risk is the risk that the Groupwill be unable to fulfil its financialliabilities upon maturity. According tothe approach adopted by the Group forliquidity management, through themaintenance of absolutely necessarycash and cash equivalents and sufficientcredit lines with cooperating banks, theGroup will always have adequate fundsto fulfil its liabilities upon maturity, bothunder ordinary and extraordinaryconditions, without incurringunacceptable loss or jeopardizing theGroup’s reputation.

To prevent liquidity risks, whenpreparing its annual budget, the Groupestimates its cash flows for one year. TheGroup also estimates such cash flowsevery quarter so as to ensure that it holdssufficient cash and cash equivalents tomeet its operating needs, including the

fulfilment of its financial liabilities. Thispolicy does not take into account therelevant effect from extreme conditionsthat cannot be foreseen.

3.3 Market riskMarket risk is the risk of fluctuations in rawmaterial prices, exchange rates andinterest rates which can have an effect onthe Group’s results or the value of itsfinancial instruments. Market riskmanagement is aimed at controlling theGroup’s exposure to relevant risks withina framework of acceptable parameters,with a parallel optimization ofperformance.

The Group uses transactions onderivative financial instruments in order tohedge part of market risks.

3.3.1 Metal Raw Material FluctuationRisk (copper, aluminium, othermetals)

The Group bases both its purchases andsales on stock prices/indices linked to theprices of copper and other metals whichare used by the Group and included in itsproducts. The risk from metal pricefluctuation is covered by hedginginstruments (futures and options onLondon Metal Exchange-LME). The Group,however, does not use hedginginstruments for the entire stock of itsoperation and, as a result, any drop inmetal prices may have a negative effect onits results through inventoriesdepreciation.

3.3.2 Foreign exchange riskThe Group is exposed to foreign exchangerisk in connection with its sales andpurchases and its loans issued in acurrency other than the functional


currency of the Group companies, whichis primarily the Euro. The currencies usedfor such transactions are mainly the Euro,the US dollar and the pound.

Over time, the Group hedges thegreatest part of its estimated exposure toforeign currencies in relation to theanticipated sales and purchases as well asreceivables and liabilities in foreigncurrency.

In most of the cases, the Group signsforeign currency futures with its foreigncounterparties in order to hedge the riskof foreign exchange rate changes, whichexpire normally in less than one year fromthe balance sheet date. When necessary,such futures are renewed upon expiry. Ona per-case basis, foreign exchange riskmay also be hedged by obtaining loans inthe respective currencies.

Loan interest is in the same currency asthat used in the cash flows arising fromthe Group’s operating activities, which ismainly the Euro.

Group investments in foreignsubsidiaries having other functionalcurrency than the Euro (e.g. RON for ICMEECAB) are not hedged because suchforeign exchange positions are consideredto be of long-term nature.

3.3.3 Interest rate riskThe Group obtains funds for itsinvestments and its working capitalthrough bank loans and bond loans, andthus debit interest is charged to its results.Any upward trend of interest rates willhave a negative effect on results since theGroup will bear additional borrowingcosts.

The interest rate risk is mitigated aspart of the group’s loans are obtainedbased on fixed interest rates, either

directly or through the use of financialinstruments (interest rate swaps).

3.3.4 Capital managementThe policy applied by the Board ofDirectors includes the maintenance of arobust capital basis, in order to keep theGroup trustworthy among investors,creditors and market players, and allowthe future development of the Group’sactivities. The Board of Directors monitorscapital performance, which is defined bythe Group as the net results divided by thetotal net worth, exclusive of nonconvertible preferred shares and minorityinterests. The Board of Directors alsomonitors the level of dividendsdistributed to holders of ordinary shares.

The Board of Directors tries to maintaina balance between the higherperformance levels which would havebeen attained through increased loansand the advantages and security offeredby a robust and healthy capital basis.

The Group does not have a specificown share purchasing plan.

There have been no changes in theapproach adopted by the Groupconcerning capital management duringthe fiscal year.

4. Objectives and Outlook for 2012HELLENIC CABLES Group pursues steadilyits growth, focusing on the administrativeand operational incorporation of FULGORin the Group, on the attainment ofsynergies and economies of scale, onincreasing its sales to foreign markets andalso on improving profit margins throughthe increased sales of high added valueproducts. Concurrently, the prudentmanagement of working capital and, byextension, total borrowing, is considered


critical owing to the increased financingcost and overall liquidity problemsregistered in the Greek and Europeanmarkets.

As regards the performance of itsfinancial figures for 2012, the aggravationof the financial situation in Greece andmany European countries is expected toaffect the Group’s results. Nevertheless,the benefits from the Group’s strategicmoves will be gradually noticed and areexpected to improve the financial figures.HELLENIC CABLES Group remains optimistas for the attainment of the goals setdespite the adverse circumstancesprevailing in the market, since 2012 willsee the first sales of submarine cables andextra high-voltage underground cablesfrom which the Group expects to draw aconsiderable pat of its future profitability.

Hellenic Cables aims to maintain itsleading position in the Greek andRomanian markets relying on the long-standing relations developed withcompanies in the energy and constructionsectors and also on the high quality andcompetitive pricing of its products. As forexports, the increase in the shares in themain EU markets and further expansion ofits clientele base to electricity generation,transmission and distribution companiesand also to specialized sectors such asrenewable energy sources (cables forphotovoltaic and wind parks) is deemedimportant. Like in the previous years, theperformance of foreign exchange rateswill have a significant effect on exports tonon-EU countries.

Finally, the personnel health, safetyand training as well as corporate andsocial responsibility are still veryimportant for the Group’s operation andan integral part of its long-term strategy

5. Significant transactions withAffiliates

The transactions of Hellenic Cables Groupand Company are set out in the Tables1.2, 1.3 and 1.4.

STEELMET provides Hellenic Cables withadministration and organization services.

HALCOR purchases from HellenicCables Group copper scrap from thereturns generated from the productionprocess and PVC which HALCOR uses forinsulated pipes. Hellenic Cables Grouppurchases from HALCOR significantquantities of wire for cable manufacturing.

SOFIA MED sells copper productsprimarily to the subsidiary Genecos.

METAL AGENCIES acts as trader-distributor of Hellenic Cables Group inGreat Britain.

FITCO sells to Hellenic Cables copperstrips and buys copper scrap from thereturns generated from the productionprocess.

ELVAL buys from Hellenic Cables Groupaluminium scrap from the returnsgenerated from the production process.

ERLIKON sells to Hellenic Cables steelwires for cable manufacturing.

COOPER VALIUS buys from ICME ECABcopper scrap from the returns generatedfrom the production process.

ICME ECAB purchases from HellenicCables plastic/rubber mixes for itsproduction process as well as finishedcables that the company cannot produce.ICME ECAB also sells to Hellenic Cablessemi-finished and finished products fordistribution in the domestic market.

FULGOR purchases from HellenicCables raw materials and semi-finishedproducts for cable production and sells toHellenic Cables finished (mainly cables)and semi-finished products.


LESCO EOOD sells to Hellenic Cableswooden packaging materials.

5.1 Remuneration paid to Boardmembers and top executives

The fees paid to management executivesand members of the Board of Directors in2011 amounted to euro 841,601 forHellenic Cables Group and euro 618,749for the parent company Hellenic Cables.

6. Detailed Information under Article4(7) of Law 3556/2007

6.1 Structure of Share CapitalThe Company’s share capital amounts to

euro 20,977,916 divided into 29,546,360ordinary registered shares with anominal value of euro 0.71 each. Allshares are listed and traded on theprimary securities market of the AthensStock Exchange, in the MediumCapitalization category. The Company’sshares are dematerialized, registeredwith voting rights. On 7 September 2011,the General Meeting of the Company’sshareholders decided to increase itsshare capital following the agreementconcluded with various banks in order tosettle the debts of Fulgor, suchagreement anticipating the waiver of old

TABLE 1.2 Transactions of Hellenic Cables Company with subsidiaries (amounts in euro)

Companies Sales of goods, Purchases of goods, Receivables Payablesservices & fixed assets services & fixed assets

ΙCME ECAB 17,444,629 39,306,111 2,695,565 16,832,006FULGOR 25,496,247 15,829,229 18,836,104 1,015LESCO EOOD 18,830 1,441,442 12,150 481,990OTHER 147,554 154,166 87,716 39,965Subsidiaries’ Total 43,107,260 56,730,948 21,631,535 17,354,976

TABLE 1.3 Transactions of Hellenic Cables Company with Affiliates (amounts in euro)


STEELMET S.A. 0 1,060,436 0 120,755HALCOR 17,633,458 9,899,900 1,552,882 0METAL AGENCIES 1,470,411 307,551 1,315,201 149,849FITCO 1,370,466 133,992 430,604 1,583ELVAL S.A. 2,563,190 3,351,899 983,035 2,658,632ERLIKON 3,203 2,203,508 0 547,752OTHER 898,028 2,472,548 1,203,050 901,521Affiliates’ Total 23,938,756 19,429,834 5,484,772 4,380,092

TABLE 1.4 Transactions of VIOHALCO Group with Hellenic Cables Group (amounts in euro)


STEELMET 0 1,060,436 0 120,755HALCOR 18,381,174 50,687,513 1,950,813 725,591SOFIA MED 618,517 6,969,828 120,797 1,638,485METAL AGENCIES 1,825,369 359,516 1,487,796 156,337FITCO 1,423,786 133,992 436,197 1,583ELVAL 4,121,717 5,265,960 1,211,404 2,671,634ERLIKON 3,203 2,510,299 0 854,043COOPER VALIUS 3,297,152 0 19,883 0OTHER 3,072,775 3,098,689 1,587,694 858,116TOTAL 32,743,693 70,086,233 6,814,584 7,026,544


shareholders in favour of lending banks.The share capital increase stood at euro9,593,921 and was completed on 7February 2012. Specifically, 2,320,000new ordinary registered shares wereissued and started being traded on theASE on 7 March 2012. On 31 December2011, the Company registeredreceivables from new shareholders andraised accordingly the share capital sinceit believed that the new shareholdershad the contractual obligation to takepart in the share capital increase.

According to the Company’s articles ofassociation the rights and obligations ofshareholders are the following:• Right to dividend from the Company’s

annual earnings. The dividend of eachshare is paid to its holder within two (2)months from the date of the GeneralMeeting that approved the financialstatements. The right to receivedividend is cancelled after five (5) yearsfrom the end of the year, during whichthe General Meeting approved thedividend distribution.

• Pre-emptive right to any share capitalincrease and withdrawal of new shares.

• Right to participate in the GeneralShareholders’ meeting.

• The capacity of the shareholderrightfully entails acceptance of theCompany’s articles of association andthe decisions of its bodies, which are inaccordance with such and the law.

• The Company’s shares are indivisibleand the Company does recognize onlyone owner exclusively for each share.All co-owners of shares, as well as thosewith usufruct or bare ownership of suchare represented in the General Meetingby only one individual, who isdesignated by such following an

agreement. In case of a dispute, theshare of the above owners is notrepresented.

• Shareholders are not liable further thanthe nominal value of each share.

6.2 Limitations to the transfer ofCompany shares

The transfer of Company shares takesplace as stipulated by the Law and thereare no limitations regarding such transfersfrom its Articles of Association.

6.3 Significant direct or indirectparticipations according to thedefinition of articles 9 to 11 of L.3556/2007

The significant (over 5%) participations on31.12.2011 are as follows:• VIOHALCO S.A.: percentage of 74.47%

of voting rights (direct and indirect) • HALCOR S.A.: percentage of 72.53% of

share capital

6.4 Shares incorporating special controlrights

There are no Company shares that providespecial control rights to owners.

6.5 Limitations on voting rightsAccording to the Company’s Articles ofAssociation, there are no limitations onvoting rights emanating from its shares.The rules of the Company’s articles ofassociation, which stipulate issues ofvoting, are included in article 24 of itsArticles of Association.

6.6 Agreements between CompanyShareholders

To the knowledge of the CompanyManagement, there are no agreementsbetween shareholders.


6.7 Rules for appointment andreplacement of BoD members andamendment of the articles ofassociation

The rules stated by the Company’s Articlesof Association regarding the appointmentand replacement of its Board of Directors’members and the amendment of theprovisions of its Articles of Association donot differ from those stipulated by C.L.2190/1920.

6.8 Responsibility of the Board ofDirectors for the issuance of newshares or the purchase of own shares

• Article 6 § 1 of the Company’s articles ofassociation stipulates that only theGeneral Shareholders’ Meeting, whichconvenes with quorum of 2/3 of thepaid up share capital, has the right toincrease the Company’s share capitalthrough issuance of new shares, bymeans of a decision made by a majorityof 2/3 of the represented votes.

• The Company’s articles of associationdo not allow the granting to the Boardof Directors or to specific BoD membersof any right corresponding to theGeneral Meeting, for issuance of sharesand share capital increase.

• The Board of Directors may proceedwith the purchase of own shares in thecontext of a decision by the GeneralMeeting according to article 16 par. 5 to13 of C.L. 2190/20.

• In pursuance of article 13(e) of C.L.2190/20, the Company’s Board ofDirectors during the month ofDecember of years 2006 until 2013,increases the Company’s share capital,without amendment of its articles ofassociation, by issuing new shares inthe context of the Stock Option Plan

approved by the General Shareholders’Meeting on 26.06.2002. Detailedinformation on the latter is presentedanalytically in note 30 of the AnnualFinancial Statements.

6.9 Significant agreements put intoeffect, amended or terminated in caseof a change in the Company’s control

The contracts of the Company’s ordinarybond loans, which were undertaken in fullby Banks and are presented in note 28 ofthe annual financial statements (Group:euro 95 million, of which euro 31 millionare of short-term duration; and for theCompany euro 60 million, of which euro22 million are of short-term duration),include a clause for change in control intheir terms, which provides lenders withthe right to denounce such before theirmaturity in case the clause is activated.

To the best of the CompanyManagement’s knowledge, there are noother agreements which are put intoeffect, amended or terminated in case ofa change in the Company’s control.

6.10 Agreements with BoD members orthe Company’s staff

To the best of the CompanyManagement’s knowledge, there are noagreements of the Company with themembers of its Board of Directors or withits staff, which stipulate the payment ofindemnity specifically in case ofresignation or termination of employmentwithout reasonable cause or oftermination of their term or employment.

7. STATEMENT OF CORPORATEGOVERNANCE

7.1 Code of Corporate Governance The Company and the Group have


adopted the practices of CorporateGovernance as to how it is managed andrun, as these are specified by theapplicable institutional framework andthe Corporate Governance Code recentlypublished by the Hellenic Federation ofEnterprises (SEV) (hereinafter referred toas “code”) and available on the followingwebsite:

http://www.sev.org.gr/Uploads/pdf/KED_TELIKO_FEVR.2012.pdf

In the context of preparation of theAnnual Management Report of the Boardof Directors, the Company reviewed theCode. Based on such review, the Companyconcluded that it applies the specialpractices for listed companies that are setout and described in the CorporateGovernance Code of SEV save thefollowing practices for which the relevantexplanations are laid down: • Part A.2. 2.2, 2.3 & 2.5: Size and

composition of the Board: a) Theindependent non-executive membersof the current Board of Directors aretwo (2) out of eleven (11) and, therefore,their number is less than the one thirdof all its members, as indicated in theCode; b) an independent member hasserved for a period exceeding 12 yearsfrom his/her first election.Under the current circumstances, it wasdeemed that the increase in thenumber of independent members orthe restriction of members' term ofoffice would not improve the effectiveoperation of the company.

• Part A.3. 3.3: Role and profile of theBoard Chairman. The Chairman of theBoard of Directors is an executivemember while the Vice-chairman isnon-executive, non-independentmember.

Under the current circumstances, it wasnot deemed that the company's moreeffective operation would beguaranteed if the Board Vice-chairmanwere an independent member inaddition to non-executive.

• Part Α.5. 5.5: Nomination of Boardmembers. There was no committee tonominate members until the time thisStatement was drafted for the samereasons as above.

• Part Α.7 .7.1. – 7.3: Evaluation of Boardof Directors and its Committees. Untilthe time this Statement was drafted,the Company had not chosen anyspecific collective procedure toevaluate the effectiveness of the Boardof Directors and its Committees.

• Part Γ.1. 1.6: Level and structure ofremuneration. Until the time thisStatement was drafted, there was noRemuneration Committee. The issuewill be soon reviewed.

The Company does not implement anyother corporate governance practicesthan the special practices of the CorporateGovernance Code of SEV and theprovisions of Law 3873/2010.

7.2 Main characteristics of the InternalControl and Risk ManagementSystems in relation to the preparationof the Financial Statements andfinancial reports

7.2.1 Description of main characteristicsand details of the Internal Control and RiskManagement Systems in relation to thepreparation of the consolidated financialstatementsThe Internal Control System of theCompany covers the control proceduresinvolving the functioning of the


Company, its compliance with therequirements of supervisory authorities,risk management and preparation offinancial reports.

The Internal Audit Function controlsthe proper implementation of eachprocedure and internal control systemregardless of their accounting or non-accounting content and evaluates theenterprise by reviewing its activities,acting as one service to Management.

The Internal Control System aims,among others, to secure thethoroughness and reliability of the dataand information required for the accurateand timely determination of theCompany’s financial situation and thegeneration of reliable financialstatements.

As regards the preparation of financialstatements, the Company reports that thefinancial reporting system of “HellenicCables S.A.-Hellenic Cables Industry” usesan accounting system that is adequate forreporting to Management and externalusers. The financial statements and otheranalyses reported to Management on aquarterly basis are prepared on anindividual and consolidated basis incompliance with the InternationalFinancial Reporting Standards, as adoptedby the European Union for reportingpurposes to Management, and also for thepurpose of publication in line with theapplicable regulations on a quarterlybasis. Both administrative information andfinancial reports to be published includeall the necessary details about an updatedinternal control system including analysesof sales, cost/expenses and operatingprofits as well as other data and indexes.All reports to Management include thedata of the current period compared to

the respective data of the budget, as thelatter has been approved by the Board ofDirectors, and to the data of the respectiveperiod of the year before the report.

All published interim and annualfinancial statements include all necessaryinformation and disclosures about thefinancial statements, in compliance withthe International Financial ReportingStandards, as adopted by the EuropeanUnion, reviewed by the Audit Committeeand approved in their entirety by theBoard of Directors.

Controls are implemented with respectto: a) risk identification and evaluation asfor the reliability of financial statements;b) administrative planning andmonitoring of financial figures; c) fraudprevention and disclosure; d) roles andpowers of executives; e) year closingprocedure including consolidation (e.g.written-down procedures, access,approvals, agreements, etc) and f )safeguarding the data provided byinformation systems.

The internal reports to Managementand the reports required as per CodifiedLaw 2190/1920 and by the supervisoryauthorities are prepared by the FinancialServices Division, which is staffed withadequate and experienced executives tothis effect. Management takes steps toensure that these executives areadequately updated about any changes inaccounting and tax issues concerningboth the Company and the Group.

The Company has established separateprocedures as to how to collect thenecessary data from the subsidiaries, andsees to the reconciliation of separatetransactions and to the implementation ofthe same accounting principles by theGroup companies.


7.2.2 Annual evaluation of corporatestrategy, main business risks and InternalControl SystemsThe Company’s Board of Directors statesthat it has examined the main businessrisks facing the Group, as well as theInternal Control Systems. On an annualbasis, the Board of Directors reviews thecorporate strategy, main business risksand Internal Control Systems.

7.2.3 Provision of non-audit services to theCompany by its legal auditors andevaluation of the effect this fact may haveon the objectivity and effectiveness ofmandatory audit, having also regard tothe stipulations of Law 3693/2008The legal auditors of the Company for thefiscal year 2011, i.e. “KPMG CertifiedAuditors A.E.”, who have been elected bythe Ordinary General Meeting of theCompany’s Shareholders on 16 June 2011,do not provide and have not providednon-audit services to the Company and itssubsidiaries apart from those provided forin laws.

The Company employs the services ofother auditors for other non-audit services,whose fees for 2011 totalled euro 98,366.

7.3 Takeover bids - Information • There are no binding takeover bids

and/or rules of mandatory assignmentand mandatory takeover of theCompany's shares or any statutoryprovision on takeover.

• There are no third-party public offers totake over the Company’s share capitalduring the last and current year.

• In case the Company decides to takespart in such a procedure, this will takeplace in the context of European lawsand applicable Greek laws.

7.4 General Meeting of shareholders andrights of shareholders

A General Meeting is convened andfunctions in compliance with thestipulations of the Articles of Associationand the relevant provisions of Law2190/1920, as amended and in forcetoday. The Company makes the necessarypublications in line with the provisions ofLaw 3884/2010 and generally takes allsteps required for the timely andthorough information of shareholdersabout how to exercise their rights. Thelatter is ensured by publishing theinvitations to General Meetings anduploading them on the Company’swebsite, the text of which contains adetailed description of shareholders rightsand how these are exercised.

7.5 Composition and functioning of theBoard of Directors, SupervisoryBodies and Committees of theCompany

7.5.1Role and responsibilities of theBoard of Directors The Company’s Board of Directors isresponsible for the long-term strategy andoperational goals of the Company andgenerally for control and decision-makingin the context of the stipulations of C.L.2190/1920 and the Articles of Association,and for the compliance with corporategovernance principles.

The Board of Directors convenes at thenecessary intervals so as to perform itsduties effectively.

The role and responsibilities of theBoard of Directors are summed up asfollows:• Oversight and monitoring of Company

operations as well as control of


attainment of business goals and long-term plans;

• Formulation and determination ofCompany core values and objectives;

• securing the alignment of the adoptedstrategy with Company goals.

• The Board of Directors ensures thatthere are no conflicts of interests andexamines any incidents or cases ofdeviation from the policy involvinginformation confidentiality;

• Ensuring the reliability and approval ofthe Company’s Financial Statementsprior to their final approval by theOrdinary General Meeting;

• Securing the implementation of itsbusiness activity on a daily basisthrough a special authorization systemwhile the other issues falling under itsscope are implemented by way ofspecial decisions.

• The main powers of the Board'ssecretary are to support the Chairmanand the body’s general functioning.

The existing Board of the Companyconsists of 12 members of whom:• 4 are executive (Vice-chairman & 3

Members) • 6 are non-executive (Vice-chairman &

other Members)• 2 are independent, non-executive

(other members)

The existing Board of Directors of HellenicCables S.A.-Hellenic Cables Industryconsists of the following:• Ioannis Batsolas, Chairman,

executive member• Konstantinos Laios,

Vice chairman, non-executive member• Alexios Alexiou,

executive member

• Michael Diakogiannis, non-executive member

• Andreas Katsanos, non-executive member

• Andreas Kyriazis, independent, non-executive member

• Nikolaos Galetas, independent non-executive member

• Georgios Stergiopoulos, executive member

• Ronald Gee, non-executive member

• Wiedenmann Rudolf, non-executive member

• Iakovos Georganas, non-executive member

• Ioannis Stavropoulos, executivememberThe members of the Board are elected

for a one-year term by the GeneralMeeting of shareholders. The existingBoard of Directors of the Company waselected by the Ordinary General Meetingon 16 June 2011 and its term of office shallexpire during the first half of 2012.

The Board of Directors met 55 timesduring 2011 with 9 of its 12 membershaving attended them in person.

7.5.2 Below are given the curriculum vitaeof the Board members:

Ioannis Batsolas, ChairmanMr. Batsolas Ioannis is a qualifiedelectrical engineer of the KARLSRUHEUniversity in West Germany and hasbeen working in VIOHALCO Group since1970. He has served as Quality ControlManager and Technical Manager ofHELLENIC CABLES S.A. and also GeneralManager of Telecables SA from 1991 todate. He is also the Chairman on the


Board of Directors of HELLENIC CABLESSA since 2005 to date and of TELECABLESSA from 2009 to date. He is a simplemember in other Group companies. Heis also a Secretary of the Association ofViotia Industries.

Konstantinos Laios,Vice-Chairman, non-executivememberMr. Laios is a graduate mechanical-electrical engineer from the NationalPolytechnic University of Athens havingmade his postgraduate studies inGermany. He had worked in the PublicPower Corporation where he assumed asenior management post. Since 1983 hehas assumed various management postsin various companies of VIOHALCO Group.He is also the Chairman of the Board ofDirectors of ICME ECAB S.A. and Vice-chairman of TELECABLES S.A.

Alexios Alexiou, executive memberMr. Alexios Alexiou is a graduate of theEconomics University of Piraeus andmade his postgraduate studies inFinancial Sciences in StrathclydeUniversity. He has been working inVIOHALCO Group since 1996. He hasworked as Financial Manager ofHELLENIC CABLES SA during 2002-2003,General Manager of ICME ECAB S.A.during 2003 – 2008 and General Managerof HELLENIC CABLES SA from 2009 todate.

Michael Diakogiannis, non-executive memberHe is a graduate of Athens University ofEconomics and Business. He worked asFinancial Manager of VIOHALCO

VITROUVIT SA from 1967 to 1978. From1979 to 1988 he worked as FinancialManager of HELLENIC CABLES SA. From1989 to 2000 he worked as FinancialManager of VIOHALCO SA and from 2000to date he is the General Manager of thesame company.

Andreas Katsanos,non-executive memberMr. Andreas Katsanos is a graduate ofPiraeus Economics University and hasbeen working in VIOHALCO Group since1960. He has worked as supervisor ofvarious Group companies and from 1978to 1980 he held the post of GeneralManager in VIOTIA CABLES SA. From 1989to date he is the Manager of the metaldepartment of VIOHALCO Groupcompanies. Mr. Katsanos had played adecisive role in the Bank of Greeceadopting and applying in Greece hedgingprocedure (metal price volatility hedging),through the London Metal Exchange. Healso participates in the Board of Directorsof HALCOR S.A.

Andreas Kyriazis, independent, non-executive memberMr. Andreas Kyriazis is a graduate of theChemistry Department of Physics andMathematics School of Athens University.He has served as Chairman of the CentralUnion of Greek Chambers, the Union ofBalkan Chambers, the Chamber of Com-merce and Industry of Athens, the HellenicProductivity Centre, the Hellenic Societyof Business Administration, and the Asso-ciation of Timber Industry. He has alsoserved as Vice-chairman of the Union ofthe European Chamber of Commerce andIndustry and General Secretary of theUnion of Greek Chemists.


Nikolaos Galetas,independent, non-executive memberMr. Nikolaos Galetas is a graduate of theTheology School of Athens Universityand studied in Technische HochschuleWien while being a graduate engineer ofthe Electrical Engineering School of theNational Polytechnic University ofAthens. During his long career, Mr.Galetas held management posts in theHellenic Development Bank (ETBA),Planning and Development Company(EPA) and the Hellenic Bank of IndustrialDevelopment Investments (ETEBA)where he also served as GeneralManager. Mr. Galetas has also served asManagement Consultant to ETEVA andEFG EUROBANK PROPERTIES SA, whilealso being a member on the BoD of manycompanies including, among others, EFGEUROBANK PROPERTIES SA and ERT(Vice-chairman), and also in varioussubsidiaries of ETEBA Group where heassumed the post of Board Chairmanduring his long career in the saidcorporation. In addition, during theperiod 1990-92 he offered consultingservices to the Ministries of InternalAffairs, Agriculture and Coordination.

Georgios Stergiopoulos, executive memberMr. Georgios Stavropoulos is a graduate ofAthens University of Economics andBusiness and has been working inVIOHALCO SA Group since 1971. He hasserved as Financial Manager of SANITASAGENCY SA and many other Groupcompanies. He is chairman of DIATOURSA, vice-chairman of NOVAL SA andmember on the Board of Directors ofother Group companies.

Ronald Gee,non-executive memberMr. Ronald Gee studied in Balliol CollegeOxford and has served as senior officer ofthe British Air Force during World War II.He is a member of the BoD of HellenicCables over the last 25 years. He has alsoserved as commercial member of theLondon Metal Exchange in London formany years.

Rudolf Wiendenmann,non-executive memberDr. Rudolf Wiendenmann has studiedchemistry in Ludwig- MaximiliansUniversität München and has a PhD innatural sciences. From 1967 to 1976 heworked in the research anddevelopment team of SIEMENS inGermany. From 1976 to 1990 he workedas Director of various departments ofSIEMENS while from 1991 to 1998 heheld the post of Chairman of the energycable department. In addition, duringthe period 1994-1997 he held the post ofChairman of the European Association ofCable Manufacturers (EUROPACABLE).He is also a Board member of ICME ECABS.A.

Iakovos Georganas,non-executive memberMr. Iakovos Georganas studied in theUniversity of Economics and Business(Athens, 1955) and in Harvard BusinessSchool (Advanced Management Program– spring 1979). He is non-executive vice-chairman of the Board of Directors ofPiraeus Bank and Chairman of the RiskManagement Committee. He has been anexecutive vice-chairman of the Board ofDirectors of the Bank since January 1992to May 2004.


He is also the Chairman of HellenicExchanges SA and a member on the Boardof the Hellenic TelecommunicationsOrganization SA, member on the Board ofthe Association of Greek Industries andVice-chairman of the BoD of the Greek-Japanese Chamber of Commerce. He isalso a member of the Board of variouscommercial, industrial, financingcompanies without executive powers. InJuly 1958 he joined the service of theOrganization for Financing FinancialDevelopment, later renamed into ETBAbank, and withdrew after 32 years(31.01.1991) as Senior Deputy-Governor.He was a vice-chairman and member ofthe Hellenic Capital Market Commissionfrom 12.01.1989 to 31.01.1991, a memberof the Executive Committee of the Boardof the Union of Hellenic Banks, a memberof the Committee of Deputy Governors ofLong-term Credit Institutes of theEuropean Community and a member ofthe Board of Directors of the Foundationfor Economic and Industrial Research(IOBE). He has also served as chairman ofthe Audit Committee of Piraeus Bank(June 2000 - August 2001).

Ioannis Stavropoulos, executive memberMr. Ioannis Stavropoulos is a graduate ofPiraeus University (former HigherIndustrial School of Piraeus) and has beenworking in VIOHALCO Group since 1972.He has served as Financial Manager ofVITROUVIT SA (1978), General Manager ofHellenic Cables Mesologi SA (1989),General Manager of KEM SA (1998) andGeneral Manager of SIDENOR SA (1999).He is also a member on the Board of otherGroup companies.

7.6 Audit Committee7.6.1 Description of the composition,functioning, work, responsibilities and ofthe issues discussed during Committeemeetings The Audit Committee, which is electedand functions in line with Law 3693/2008(Article 37), consists of three non-executive members of the Board ofDirectors. One of them is independentand his main task, in the context of theobligations described by the above law, isto support the Company’s Board ofDirectors to fulfil its mission to safeguardthe effectiveness of accounting andfinancial systems, audit mechanisms,business risk management systems;assure compliance with the legal andregulatory framework; and implementeffectively Corporate Governanceprinciples.

More specifically, the Audit Committeehas the following responsibilities:• To examine the effectiveness of all

Management levels in relation to thesafeguarding of the resources managedand their compliance with theCompany’s established policy andprocedures;

• To evaluate the procedures and data interms of adequacy as for the attainmentof objectives and assess the policy andthe program concerning the activityunder review;

• To control periodically the variousfunctions of different divisions ordepartments so as to ensure that theirvarious functions are carried outregularly, comply with Managementinstructions, Company policy andprocedures, and that they abide byCompany objectives and standards ofmanagement practice;


• To review internal audit reports andspecifically:

- to evaluate the adequacy of theirextent;

- to confirm the accuracy of reports;- to examine the adequacy of support to

results.The Audit Committee receives the

following reports on audit activity:• Extraordinary reports• Financial audit quarterly reports• Ordinary audit annual reports• Corporate Governance Reports

The Audit Committee examines andensures the independence of theCompany’s external auditors and takescognizance of their findings and the AuditReports on the annual or interim financialstatements of the Company. At the sametime, it recommends corrective actionsand procedures so as to deal with anyfindings or failures in areas of financialreports or other important functions ofthe Company.

According to the Internal Regulationfor its Operation, the Audit Committeeconsists of one independent and non-executive member of the Board ofDirectors and two non-executivemembers who have the necessaryknowledge and experience for theCommittee’s work.

The existing Audit Committee consistsof the following persons:BoD members:

Andreas Kyriazis - Boardindependent, non-executivemember

Michael Diakogiannis -Board non-executive memberAndreas Katsanos -Board non-executive member

7.6.2 Number of Committee meetings andfrequency of each member’s participationin meetingsThe Audit Committee met 4 times during2011 having full quorum.

7.6.3 Evaluation of effectiveness andperformance of the Committee Until the time this Statement was drafted,no special procedures had beenestablished to evaluate the effectivenessof the Audit Committee. CompanyManagement will establish suchprocedures in the future.

8. CONCLUSIONSDear Shareholders, we presented accountof the management of the financial year2011, the risks and how these will bemanaged together with the prospects anddevelopment of the Company for 2012.

The Board of Directors of HELLENICCABLES SA proposes to the GeneralMeeting of shareholders to not distributedividends from prior-period profits.

In conclusion, dear Shareholders, wewould like first to express our gratitude forthe trust that you have shown in theCompany and we request you to approvethe Company’s Financial Statements, aswell as the present report, for the fiscalyear that ended on 31 December 2011.


The Chairman of the Board of DirectorsIoannis Batsolas


Individual and Consolidated Statement of Financial Position AMOUNTS IN EURO

GROUP COMPANY2011 2010 2011 2010

ASSETSProperty, plant and equipment 142,699,539 87,868,776 69,658,858 64,321,620Intangible assets 10,160,040 409,125 267,637 348,791Investment property 2,270,174 2,152,565 2,270,174 2,152,565Holdings in subsidiaries and affiliates 779,726 760,655 21,146,967 20,442,960Other investments 1,807,484 1,807,484 1,807,484 1,807,484Deferred tax assets 427,949 260,135 - -Other receivables 574,029 671,910 469,670 462,332Total non-current assets 158,718,941 93,930,650 95,620,790 89,535,752________________ ________________ ________________ ________________

Inventories 92,165,783 68,392,515 45,580,792 38,355,431Customers and other trade receivables 76,081,125 84,800,229 84,220,775 65,917,206Derivatives 130,965 2,254,174 130,965 2,254,174Cash and cash equivalents 18,983,379 11,820,842 12,562,333 7,984,168Total current assets 187,361,252 167,267,760 142,494,865 114,510,979Total assets 346,080,193 261,198,410 238,115,655 204,046,731________________ ________________ ________________ ________________

LIABILITIESEQUITYShare Capital 20,977,916 19,330,716 20,977,916 19,330,716Share premium account 31,171,712 23,224,991 31,171,712 23,224,991Reserves 22,194,269 23,728,775 24,517,887 19,251,320Profit carried forward 40,951,919 37,662,811 17,868,281 14,422,452Equity attributed to shareholders 115,295,816 103,947,293 94,535,796 76,229,479Minority interest 819,327 751,489 - -Total equity 116,115,143 104,698,782 94,535,796 76,229,479________________ ________________ ________________ ________________

LIABILITIESLoans 65,405,241 31,327,847 38,016,667 26,827,754Payables from financial leases 438,273 - - -Payables for staff retirement indemnities 2,550,018 1,321,256 1,219,893 1,307,248Grants 1,537,093 331,493 1,476,343 331,493Provisions 200,000 200,000 200,000 200,000Deferred tax liabilities 9,499,384 3,701,498 3,816,845 3,209,780Total long-term liabilities 79,630,009 36,882,094 44,729,748 31,876,275________________ ________________ ________________ ________________

Loans 105,352,490 82,889,865 56,882,150 51,680,841Payables from financial leases 675,683 - - -Suppliers and other liabilities 43,728,263 36,126,868 41,440,651 44,093,146Derivatives 578,605 600,801 527,310 166,990________________ ________________ ________________ ________________Total short-term liabilities 150,335,041 119,617,534 98,850,111 95,940,977________________ ________________ ________________ ________________Total liabilities 229,965,050 156,499,628 143,579,859 127,817,252________________ ________________ ________________ ________________Total equity and liabilities 346,080,193 261,198,410 238,115,655 204,046,731________________ ________________ ________________ ________________

*The attached notes of the Annual Financial Report 2011 are an integral part of the financial statements.


Individual and Consolidated Statement of Total Income AMOUNTS IN EURO

GROUP COMPANY2011 2010 2011 2010

Sales 414,593,446 351,883,981 326,655,026 257,628,647Cost of Sales (387,705,507) (331,078,450) (309,653,714) (246,297,825)________________ ________________ ________________ ________________Gross Profit 26,887,939 20,805,531 17,001,312 11,330,822Other income 4,997,284 1,175,061 1,402,941 984,156Distribution expenses (7,325,092) (7,028,920) (4,029,916) (4,026,014)Administrative expenses (8,340,927) (7,937,515) (4,961,100) (4,897,563)Other expenses (4,403,344) (1,874,295) (1,560,180) (1,068,413)Operating results 11,815,860 5,139,862 7,853,057 2,322,988________________ ________________ ________________ ________________Financial income 2,017,142 1,170,284 928,795 1,694,493Financial expenses (10,236,308) (5,719,053) (7,140,967) (3,978,791)Profits/Losses from associated companies 12,780 (23,349) - -Earnings before income tax 3,609,474 567,744 1,640,885 38,690________________ ________________ ________________ ________________Income tax (278,420) (173,499) (546,228) (212,581)Year earnings/(loss) 3,331,054 394,245 1,094,657 (173,891)________________ ________________ ________________ ________________

Other income Foreign exchange differences from conversion 386,346 (1,216,680) - -Change in fair value of cash flow hedging (2,419,247) 987,422 (1,935,054) 486,644Income tax to other income items 524,287 (61,528) 446,817 (95,790)Total other income (1,508,614) (290,786) (1,488,237) 390,854________________ ________________ ________________ ________________Total period results 1,822,440 103,459 (393,580) 216,963________________ ________________ ________________ ________________

Profit/ (loss) attributed- to parent company shareholders 3,262,533 373,691 1,094,657 (173,891)- to third parties 68,521 20,554 - -Year earnings/(loss) 3,331,054 394,245 1,094,657 (173,891)________________ ________________ ________________ ________________

Total results attributable - to parent company shareholders 1,754,601 93,358 (393,580) 216,963- to third parties 67,839 10,101 - -Total period results 1,822,440 103,459 (393,580) 216,963________________ ________________ ________________ ________________

Earnings/ (loss) per share Basic earnings per share 0.117 0.014 0.039 (0.006)Diluted earnings per share 0.117 0.014 0.039 (0.006)



Consolidated statement of changes in equity AMOUNTS IN EURO

Share Consolidation Fair Other Accumulated Total Minority Total Capital foreign value Reserves profit/ (loss) interest Owner’s

and Share exchange reserves Equitypremium account differences

Balance as at 1 January 2010 42,555,707 (3,459,624) 975,939 26,492,793 37,289,120 103,853,935 741,388 104,595,323________________ ________________ ________________ ________________ ________________ ________________ ________________ ________________Total period results Period earnings/(loss) - - - - 373,691 373,691 20,554 394,245Other incomeConsolidation foreign exchange differences - (1,198,660) - - - (1,198,660) (18,020) (1,216,680)Change in fair value of cash flow hedging - - 918,327 - - 918,327 7,567 925,894Total other income - (1,198,660) 918,327 - - (280,333) (10,453) (290,786)________________ ________________ ________________ ________________ ________________ ________________ ________________ ________________Total period results - (1,198,660) 918,327 - 373,691 93,358 10,101 103,459________________ ________________ ________________ ________________ ________________ ________________ ________________ ________________Transactions with shareholders directly posted to equityDividend - - - - - - - -Transfer of reserves/distribution - - - - - - - -Total transactions with shareholders - - - - - - - -________________ ________________ ________________ ________________ ________________ ________________ ________________ ________________Balances on 31 December 2010 42,555,707 (4,658,284) 1,894,266 26,492,793 37,662,811 103,947,293 751,489 104,698,782________________ ________________ ________________ ________________ ________________ ________________ ________________ ________________

Balance as at 1 January 2011 42,555,707 (4,658,284) 1,894,266 26,492,793 37,662,811 103,947,293 751,489 104,698,782________________ ________________ ________________ ________________ ________________ ________________ ________________ ________________Total period resultsYear profits - - - - 3,262,533 3,262,533 68,521 3,331,054Other incomeConsolidation foreign exchange differences - 381,494 - - - 381,494 4,852 386,346

Change in fair value of cash flow hedging - - (1,889,425) - - (1,889,425) (5,535) (1,894,960)Total other income - 381,494 (1,889,425) - - (1,507,931) (683) (1,508,614)________________ ________________ ________________ ________________ ________________ ________________ ________________ ________________Total period results - 381,494 (1,889,425) - 3,262,533 1,754,602 67,838 1,822,440________________ ________________ ________________ ________________ ________________ ________________ ________________ ________________Transactions with shareholders directly posted to equityηShare capital increase 9,593,921 - - - - 9,593,921 - 9,593,921Transfer of reserves/distribution - - - (26,575) 26,575 - - -Total transactions with shareholders 9,593,921 - - (26,575) 26,575 9,593,921 - 9,593,921________________ ________________ ________________ ________________ ________________ ________________ ________________ ________________Balance as at 31 December 2011 52,149,628 (4,276,790) 4,841 26,466,218 40,951,919 115,295,816 819,327 116,115,143________________ ________________ ________________ ________________ ________________ ________________ ________________ ________________




Individual statement of changes in equity AMOUNTS IN EURO

Share Fair value Other Accumulated Total Owner’s Capital reserves Reserves profit/ (loss) Equity

and Share premium account

Balance as at 1 January 2010 42,555,707 1,144,164 17,716,302 14,596,343 76,012,516________________ ________________ ________________ ________________ ________________Total period results Period earnings/(loss) - - - (173,891) (173,891)Other incomeChange in fair value of cash flow hedging - 390,854 - - 390,854Total other income - 390,854 - - 390,854________________ ________________ ________________ ________________ ________________Total period results 390,854 (173,891) 216,963________________ ________________ ________________ ________________ ________________Transactions with shareholders directly posted to equityDividend - - - - -Transfer of reserves/distribution - - - - -Total transactions with shareholders - - - - -________________ ________________ ________________ ________________ ________________Balances on 31 December 2010 42,555,707 1,535,018 17,716,302 14,422,452 76,229,479________________ ________________ ________________ ________________ ________________

Balance on 1 January 2011 42,555,707 1,535,018 17,716,302 14,422,452 76,229,479________________ ________________ ________________ ________________ ________________Total period resultsYear profits - - - 1,094,657 1,094,657Other incomeChange in fair value of cash flow hedging - (1,488,237) - - (1,488,237)________________ ________________ ________________ ________________ ________________Total other income - (1,488,237) - - (1,488,237)________________ ________________ ________________ ________________ ________________Total period results (1,488,237) 1,094,657 (393,580) ________________ ________________ ________________ ________________ ________________Transactions with shareholders directly posted to equityShare capital increase 9,593,921 - - - 9,593,921Absorption of subsidiary - - 6,781,379 2,324,597 9,105,976Transfer of reserves/distribution - - (26,575) 26,575 -Total transactions with shareholders 9,593,921 - 6,754,804 2,351,172 18,699,897________________ ________________ ________________ ________________ ________________Balance on 31 December 2011 52,149,628 46,781 24,471,106 17,868,281 94,535,796________________ ________________ ________________ ________________ ________________


Individual and Consolidated Statement of Cash Flow AMOUNTS IN EURO


GROUP COMPANY2011 2010 2011 2010

Cash flows from operating activitiesEarnings before taxes 3,609,474 567,744 1,640,885 38,690Plus / less adjustments for:Fixed assets depreciation 9,369,472 8,120,982 5,423,385 5,135,175Depreciation of grants (335,125) (36,516) (335,125) (36,516)Provisions (mainly for receivables and stocks) (400,892) (52,725) 490,349 425,100Results (income, expenses, profit and loss) from investment activity 419,130 (1,082,872) 337,358 (866,913)Income from dividends - - (619,601)Interest charges and related expenses 9,238,165 4,801,210 6,142,823 3,153,777(Profits)/ Losses from sale of fixed assets (31,231) (2,929) (31,231) (54,665)Losses from the destruction/impairment of fixed assets 18,525 83,055 - 20,756Decrease/(increase) in inventories (21,798,420) (8,779,230) (7,187,237) (3,037,832)Decrease/(increase) in receivables 20,049,435 (21,553,603) (1,681,101) (16,121,381)(Decrease)/ increase in payables (less loans) (14,103,008) 8,343,889 (3,374,328) 9,220,465Interest charges and related paid-up expenses (8,972,995) (4,656,228) (5,877,652) (3,008,795)Taxes paid (413,446) (170,095) (184,323) (158,629)Net cash flows from operating activities (3,350,916) (14,417,318) (4,636,197) (5,910,369)________________ ________________ ________________ ________________Cash flows from investment activitiesPurchases of tangible assets (8,113,609) (5,402,456) (5,105,289) (3,987,767)Purchases of intangible assets (149,681) (35,442) (52,974) (35,442)Sales of tangible assets 85,870 5,623 85,870 105,621Absorption of subsidiary - - 287,942 -Acquisition of subsidiary (3,114,495) - (3,430,000) -Dividend received - 557,641 - 557,641Interest received 116,563 258,542 211,116 19,234Net cash flows from investment activities (11,175,352) (4,616,092) (8,003,335) (3,340,713)________________ ________________ ________________ ________________Cash flows from financing activitiesDividend paid to parent company shareholders - -Loans obtained 106,421,745 68,545,083 54,223,554 36,305,220Payment of loans (85,442,316) (49,038,797) (37,833,332) (21,743,880)Grants received 827,475 827,475 -Changes in financial lease funds (109,648) - - -Net cash flows from financing activities 21,697,256 19,506,286 17,217,697 14,561,340________________ ________________ ________________ ________________Net (decrease) / increase in cash and cash equivalents 7,170,988 472,876 4,578,165 5,310,258________________ ________________ ________________ ________________Cash and cash equivalents in the beginning of the fiscal year 11,820,842 11,458,232 7,984,168 2,673,910Foreign exchange differences in cash equivalents (8,451) (110,266) - -Cash and cash equivalents at the end of the fiscal year 18,983,379 11,820,842 12,562,333 7,984,168________________ ________________ ________________ ________________


Report on the Individual andConsolidated Financial StatementsWe have audited the attached individualand consolidated financial statements ofHELLENIC CABLES S.A. (the “Company”)which consist of the individual and con-solidated statement of financial positiondated 31 December 2011, the individualand consolidated statements of total In-come, changes in equity and cash flowsfor the year ended on that date and a sum-mary of main accounting principles andother explanatory notes.

Management responsibility for theIndividual and Consolidated FinancialStatementsManagement is responsible for the com-pilation and fair presentation of these in-dividual and consolidated financialstatements in accordance with the Inter-national Financial Reporting Standards, asadopted by the European Union, and inline with those internal checks and bal-ances which Management considers nec-essary to make it possible to draw upindividual and consolidated financialstatements free of material misstatementsdue to fraud or error.

Auditor responsibilityIt is our responsibility to express an opin-ion on those individual and consolidatedfinancial statements in light of our audit.We conducted our audit in compliancewith International Auditing Standards.These standards require that we complywith the code of conduct and that we de-sign and carry out our audit so as to pro-vide a fair assurance as to what extent the

individual and consolidated financialstatements are free of material inaccura-cies.

The audit includes procedures to col-lect audit proof about the amounts andinformation contained in the individualand consolidated financial statements.The procedures are selected at the audi-tor's discretion and include an assess-ment of the risk of substantive inaccuracyin the individual and consolidated finan-cial statements due to fraud or error. Toestimate this risk, the auditor takes intoaccount the internal checks and balancesregarding the compilation and fair pres-entation of the individual and consoli-dated financial statements that aim to thedesign of audit procedures which are suit-able under the circumstances and not toexpress an opinion on the effectiveness ofthe company’s internal checks and bal-ances. The audit also includes an evalua-tion of the suitability of the accountingpolicies applied and the fairness of the as-sessments made by Management and anevaluation of the overall presentation ofthe individual and consolidated financialstatements.

We consider that the audit proof whichwe have collected is adequate and suit-able to support our opinion.

OpinionIn our opinion, the attached individualand consolidated financial statementsgive a fair view of the financial positionof HELLENIC CABLES S.A. on 31 Decem-ber 2011, its financial performance andcash flows for the accounting periodwhich ended on that date in line with

Audit Report by the Chartered Auditor AccountantTo the shareholders of the company

“HELLENIC CABLES S.A.”


the International Financial ReportingStandards as adopted by the EuropeanUnion.

Reference to other legal andregulatory issues(a)The Management Report of the Boardof Directors includes a statement of cor-porate governance which provides the in-

formation specified in Article 43a(3d-3f) ofCodified Law 2190/1920.(b)We have verified that the content of theManagement Report of the Board of Di-rectors corresponds to and matches thatof the attached individual and consoli-dated financial statements in the contextof the provisions of Articles 37, 43a and108 of Codified Law 2190/1920.

KPMG CERTIFIED AUDITORS A.E.Greek ICPA (SOEL) Reg. No 114

Nikolaos Tsiboukas, Chartered Auditor-Accountant Greek ICPA (SOEL) Reg. No 17151


INVESTOR RELATIONS

Communication Officers Ioannis TheonasFinancial Director& Company AnnouncementsManager

Stavros StavropoulosInvestor Relations OfficerTel: +30 210 6787906Fax: +30 210 6787406E-mail: [email protected]

Konstantinos StamoulosShareholder Service OfficerTel: +30 210 6787424Fax: +30 2106787406E-mail: [email protected]

Offices 33 Amarousiou-Halandriou str.15125, MarousiTel: +30 210 6787900Fax: +30 210 6787406E-mail: [email protected] Site: http://www.cablel.gr

Manufacturing Plant 69th km Athens-Thebes Old National Highway32200 ThebesTel: +30 22620 86616Fax: +30 22620 86606

Manufacturing Plant 11th km Athens-Livadia Old National Highway32100 Livadia ViotiaTel: +30 22610 43232Fax: +30 22610 43038

Manufacturing Plant 53rd km Athens-Lamia National Highway32011 Oinofyta ViotiaTel: +30 22620 32578Fax: +30 22620 32578

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hellenic cables group at a glance…. · 1. message from the general manager the year 2011 became a...

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