Annual report - HSE

In 2012, the fair value reserve decreased by EUR -4,659,940, mostly as a result of lower
prices of futures contracts for emission coupons at the end of the year, compared with the
time of their conclusion. Another important reason is the decrease in negative fair value of
interest rate swaps.
Electricity futures regard closing of deals on purchase of electricity on a foreign electricity
exchanges for the period from 2013 to 2014, thus securing the already concluded deals
for the sale of electricity in the same period. Fair value reserve decreased by the amount
of electricity purchases in 2012 that were collateralised with futures, while cost of goods
sold cumulatively increased in the income statement by EUR 8,289,942. On the basis
of electricity fluctuations on stock exchange, a cumulative negative financial effect in
the amount of EUR -9,331,146 was realised in forward contracts concluded in 2012. The
negative final amount of fair value reserve with futures for electricity in the period from
2013 to 2014 is a result of lower electricity prices on the stock exchange at the end of 2012,
compared with the period of conclusion of futures for electricity purchases, and it amounts
to EUR -2,303,451.
In 2012, the company hedged against the risks arising from changes in emission coupons
prices by concluding futures contracts for purchase of emission coupons for 2012 and 2013.
Fair value reserve decreased by the amount of purchases of emission coupons realised in
2012, which were collateralised with futures, while cost of emission coupons in the item of
intangible assets increased by EUR 185,065. Negative final value of discussed contracts for
purchase of emission coupons for 2013 is the result of decreased emission coupons prices
at electricity exchange at the end of 2012, compared with the period of their conclusion,
and amounts to EUR -3,004,948.
At the end of March 2012, the company concluded a contract on interest rate swap, the
negative fair value of which amounted to EUR -2,820,568 (including deferred taxes), at
the end of 2012.
At the end of 2012, the company discloses negative fair value of currency swaps in the
amount of EUR -40,860 (including deferred taxes).
in €
Fair value reserve Standard futures Forward contracts Interest rate Currency TOTAL
for electricity for emission swaps swaps
coupons
Balance as at 01/01/2011 2,733,850 0 0 105,236 2,839,086
Creation, increase 16,994,711 0 -1,998,986 -248,654 14,747,071
Decrease -19,969,090 0 0 -105,236 -20,074,326
Transfer to expenses -1,021,718 0 0 0 -1,021,718
Balance as at 31/12/2011 -1,262,247 0 -1,998,986 -248,654 -3,509,887
Balance as at 01/01/2012 -1,262,247 0 -1,998,986 -248,654 -3,509,887
Creation, increase 1,438,632 2,935,023 -821,582 38,639 3,590,712
Closing, decrease 0 0 0 169,155 169,155
Decrease -10,769,778 -6,125,036 0 0 -16,894,814
Transfer to expenses 8,289,942 185,065 0 0 8,475,007
Balance as at 31/12/2012 -2,303,451 -3,004,948 -2,820,568 -40,860 -8,169,827
Retained earnings decreased by EUR 1,887,720 in 2012. The value:
• decreased by EUR 20,000,000, representing payment of a part of the 2011 accumulated
profit to the owner;
• decreased by EUR 3,364,810, representing a part of the 2011 accumulated profit that was
transferred in other reserves on the basis of the General Meeting decision; and
• increased by a half of the 2012 net profit, i.e. EUR 21,477,090.
Annual Report HSE 2012
4 Financial Report of the company HSE
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