Nexans Hellas Report_En.pdf · 2011-02-09 · Nexans Hellas 2006 Annual Report Nexans Hellas...

22
Nexans Hellas 2006 Annual Report Nexans Hellas i.s.a., Registered Office Athens: 15, Messoghion Avenue Registration No 2176/06/B/86/06, VAT No EL 094039860 Lamia Plant: Aghia Marina, 353 00 Stylis, Fthiotis - Greece Tel.: +30 211 120 7800 ñ Fax: +30 211 120 7899 Commercial Department: 21, Bichaki st., 182 33 Ag. I. Rentis, ∞ttiki - Greece Δel.: +30 211 120 7700 ñ Fax: +30 211 120 7799 www.nexans.gr ñ e-mail: [email protected] Global expert in cables and cabling systems

Transcript of Nexans Hellas Report_En.pdf · 2011-02-09 · Nexans Hellas 2006 Annual Report Nexans Hellas...

Nexans Hellas2006 Annual Report

Nexans Hellas i.s.a., Registered Office Athens: 15, Messoghion AvenueRegistration No 2176/06/B/86/06, VAT No EL 094039860

Lamia Plant: Aghia Marina, 353 00 Stylis, Fthiotis - GreeceTel.: +30 211 120 7800 ñ Fax: +30 211 120 7899

Commercial Department: 21, Bichaki st., 182 33 Ag. I. Rentis, ∞ttiki - GreeceΔel.: +30 211 120 7700 ñ Fax: +30 211 120 7799

www.nexans.gr ñ e-mail: [email protected]

Global expert in cables and cabling systems

Board of Directors 2

Auditors 2

Chairman’s Message 3

Financial Data 4

Invitation to the Shareholders 6

Report of the Board of Directors 7

Balance Sheet 2006 15

Notes to the Balance Sheet 2006 20

Nexans Hel las�

Board of Directors �

Board of Directors Yvon RaakChairman

Demetrios KalogerasVice Chairman & Managing Director

Jean-Pierre ReichenbachDirector

George ChryssomallisDemetrios PolitisNon Executive Independent Directors

AuditorsStatutory Auditor Konstantinos Michalatos

Independent Auditors PRICEWATERHOUSECOOPERS Auditing SA

�Nexans Hel las

Chairman’s Message �

Nexans Hellas’ performance during 2006 was one of positive progress.

The company managed to exceed last year’s key financial figures, despite difficulties that arosein certain business sectors. For example, the price of basic metals (i.e. copper and aluminium)used by the company reached the highest historical level ever in 2006 and thus increased work-ing capital considerably, in addition to a rise in financial expenses. Also, the major Greek pub-lic corporations, traditionally our company’s main customers, changed their purchasing policyprovoking a drop in price level. Regarding export markets, the environment remained very com-petitive with no significant rise in price levels.

It is good to see that the restructuring plan carried out over the past few years is bearing fruit andwe are starting to reap the benefits. We can unreservedly claim that the company has nowreached a level of productivity and competitiveness similar to its most developed competitors in-ternationally.

The Nexans Group provided full support in order for Nexans Hellas to expand into new interna-tional markets and replace, to a large extent, the missing revenue caused by the drop in the do-mestic market. We are pleased therefore that Nexans Hellas has achieved the strategic objec-tives set for 2005-2007, thus contributing to the Nexans’ Group development. We are confi-dent convinced that Nexans Hellas, enjoying the Group’s full support in all sectors, i.e. technical,organisational, commercial and administrative, will achieve the new strategic targets set for2007-2009.

For all these positive reasons, we rely on the support of our customers and the trust of our share-holders and personnel. I avail of this occasion to reaffirm my dedication, and that of Nexans Hel-las executives, to ensure further development of the company in the right direction.

YVON RAAKChairman of the Board of Directors

2006 Annual Report � 03

Nexans Hel las�

2006 2005

Sales 119.0 88.1

Profit / Loss from Operations 4.2 0.2

Net Income / Loss before tax 3.0 (0.6)

% sales 2.5% (0.7%)

Net Income / Loss after tax 3.0 (1.6)

% sales 2.5% (1.8%)

04� 2006 Annual Report

�Nexans Hel las

SALES - RESULTS �

_(Euro million)

50.7 || 50.1 ||

38 ||

70.2 ||

48.8 ||

25.8 ||

(0.5) || (0.6) || 3.0 ||

76.588.1

119

|| 2004 || || 2005 || || 2006 ||

Net Income before tax

Domestic

∂xports

SALES �

_(Euro million)

2006 Annual Report � 05

Nexans Hel las�

COMPANY BALANCE SHEET �

_(Euro million)

2006 2005

Assets

Fixed Assets (Gross) 37.0 35.1

Depreciation (21.6) (18.2)

Fixed Assets (Net) 15.4 16.9

Current Assets 56.2 46.9

Total Assets 71.6 62.8

Liabilities

Share Capital 7.7 7.7

Reserves 12.9 12.8

Retained earnings 6.7 3.8

Total Equity 27.3 24.3

Provisions 3.8 4.6

Current Liabilities 40.5 33.9

Total Equity & Liabilities 71.6 62.8

Following the Board of Directors decisionof 17 April 2007 and in accordancewith the company’s Articles ofAssociation, the shareholders ofNEXANS HELLAS I.S.A. are invited to theOrdinary General Assembly, on 31 May2007, at 4.00 p.m. at the Hotel «LifeGallery Athens», Thisseos 101 – 103,Ekali Attica, for discussing and takingdecision on the following issues:

Agenda of the meeting:1. Submission and hearing of the reports

of the Board of Directors and of theAuditor concerning the financialstatements of the period 01.01.2006to 31.12. 2006.

2. Submission and approval of thefinancial statements of the period01.01. 2006 to 31.12.2006 and ofthe relative reports by the Board ofDirectors and the Auditor.

3. Release of the members of the Board

of Directors and of the Auditor fromany liability for compensation inconnection with the financialstatements and the administrationand management in general of theperiod 01.01. - 31.12.2006.

4. Election of auditors (regular/alternate)for the period 01.01.2007 to31.12.2007 and fixing of their fee.

5. Approval of the distribution ofdividend from the profits to theshareholders.

6. Approval of the remuneration andexpenses paid to the members of theBoard of Directors and fixing of therelevant future remuneration andexpenses.

Shareholders wishing to participate in theGeneral Assembly must, through theiradministrator in the System ofDematerialized Certificates (Greek“SAT”), block all or part of their shares

and receive by said administrator arelevant certificate which they must lodge(together with any documentation ofrepresentation) with the Company'sTreasurer, or the Consignations & LoanFund, or any recognised banking sociétéanonyme in Greece or abroad anddeposit the respective certificates at theCompany's offices (15 MessoghionAvenue, 3rd floor, 115 26 Athens, tel.211 120 7770 & fax 211 120 7779)at least five (5) days before the day ofthe General Assembly. In case noadministrator has been appointed andthe shares are kept in the specialaccount, the relevant certificate isproduced by the “Hellenic ExchangesHolding S.A.” (former Central SecuritiesDepository).

Athens, 17 April 2007THE BOARD OF DIRECTORS

�Nexans Hel las

Invitation to the shareholders of “NEXANS HELLAS I.S.A.”to the Ordinary General Assembly (Registration No. 2176/06/B/86/06) �

06� 2006 Annual Report

Ladies and Gentlemenshareholders,

We have the honor to present you theFinancial Statements for the year endedDecember 31st 2006: the BalanceSheet, the Income Statement, theStatement of Changes in Equity, the CashFlow Statement and the notes to thefinancial statements together with theManagement’s Report of 32nd period ofoperation, from 01.01.2006 to31.12.2006, and to ask for yourapproval.

2006 Business

The business activity of our companyduring 2006 was satisfactory, thusconfirming last-year forecasts. At currentmetal prices, sales amounted to EUR 119million thus being increased by 35%compared with last year, while, if weconsider the sales at standard metalprices, the increase in sales volumereached 8.8% compared with last year.

During the year 2006, the companycarried out a number of orders andcontracts, the most important of whichwere the following:ñ Domestic General Market - installation

cablesñ Export Markets - E.U., Eastern Europe,

North Africa and Middle East.ñ For D.E.I. (Public Power Corporation) -

energy cables low and mediumvoltage

ñ For O.T.E. (Greek Telecom) - telecomcopper cables, fiber optic cables

Sales in the Domestic General Marketrose considerably as the demanddeveloped smoothly due to the majorinvestments in the private sector ofconstructions, investments for thedevelopment of new forms of energysources (wind farms) as well as due to theparticipation of construction firms in public and private works carried out.

The sales of the company to DEI (PublicPower Corporation) were limited to theold backlog we already had since 2005given that the levels of prices offered inthe new international tenders launched byDEI during the second semester 2006,prevented the Company from attainingeven low profit margins. The results ofthese tenders have excluded temporarilythe Company from supplying DEI for theyear 2007.

2006 Annual Report � 07

Nexans Hel las�

Report of the Board of Directors to the ordinary shareholders meetingon the financial statements for the period ended December 31st, 2006 �

The sales of thecompany to OTE(Greek Telecom) werelow due to thereduced investmentsmade by OTE during thecurrent year. On thecontrary, sales to third countrieswere marked by satisfactory demand,which caused an improvement onoperational margins.

The prices of basic metals during thecurrent year reached the highest historicallevels and affected the production cost,while increasing considerably the needsof the enterprise for working capital andfinancial expenditure respectively.

A basic principle of our Company lies incovering any risks generated fromfluctuations in exchange-traded metals(copper and aluminum) and passing anychanges in metal prices through to theselling prices to customers. Nevertheless,the high rise in metal prices increased theneeds of our customers for workingcapital and led them to reduce theirpurchases.

During the year 2006 the Company’sPlant at Aghia Marina (Stylis, Fthiotis), thedistribution centers of the company inAttica (Aghios Ioannis, Rentis), inThessaloniki (Kalochori) as well as atCrete (Iraklio) and Rhodes operatedregularly.

During the current year, the facilities ofour plant at Aghia Marina (Fthiotis) wereenhanced by a series of new investmentsand were modernized in a great extend,thus attaining maximum output andpresenting increased productivity and

significant flexibility inthe production of newtypes of cables. The readiness of the

company's distributioncenters in Attica,

Thessaloniki, Crete andRhodes to satisfy the clientele’s

demands in a thorough and promptmanner was maintained at high levelsduring the current year as well.

Operations

The sales of the company during 2006at current metal prices amounted to EUR119 million compared with EUR 88.1million for 2005. However, if wereadjust the level of sales at standardmetal prices, sales will be as indicated inthe following table.

Pre-tax earnings for the year 2006amounted to EUR 2.95 million versuslosses equal to EUR 0.56 million for2005.

Note that Nexans Group uses the ratio of“operating margin” in order to evaluatethe business performance of eachcompany, this ratio being equal to netprofit before interest and taxes andpresented as percentage of sales atstandard metal prices. The operatingmargin of the company for 2006

amounted to EUR 4.2 million, this beingequal to 5.5% of the turnover (atstandard metal prices) versus operatinglosses of EUR 0.2 million for 2005.

The Company applied the Group’spolicy and thus changed the valuationmethod of metals’ basic inventory (coreexposure), which is necessary for thesmooth operation of industrial productionat the plant at Aghia Marina (Fthiotis)and on 31-12-2006 the Companyvaluated it at the current acquisition costby applying the weighted average cost

08� 2006 Annual Report

(Euro Million)

Sales 2006 2005

Domestic market 46,645 40,701

Exports 31,602 30,318

Total 77,247 71,019

�Nexans Hel las

method after taking into account the netrealizable value at the time the financialstatements were prepared. The change inthe accounting valuation of the basicinventory resulted from further processingof IFRS and was deemed necessary dueto the drastic revaluations of metal prices(copper, aluminum), given that the newmethod reflects the value of stocks in theCompany's Balance Sheet moreaccurately.

The evaluation of basic inventorypursuant to the weighted average costmethod in conjunction with metals' risingprices led to a considerable rise in needsfor working capital, this having an impacton the asset impairment test.

Every year, Nexans Hellas carries out anasset impairment test pursuant to IFRS.Pursuant to IFRS rules, the book values oflong-term assets are controlled in terms ofimpairment wherever events or changesin circumstances indicate that their bookvalue may not be recoverable.

On the basis of the aforementionedchanges in the valuation of the basicinventory and the results of assetimpairment test, an increase in the year’sprofits resulted compared to the profitsthat the company would have if the latterapplied the accounting principles of lastyear without any change whatsoever.

Strategy - Outlook

Nexans Hellas is part of Europe Area atthe Group Organization and closelycooperates with the respective affiliates inorder to attain the strategic objectives ofthe Group and individual enterprises.

Nexans Group recently announced theresults for the year 2006 together with itsnew strategic objectives. Morespecifically, it was announced that theStrategic Plan for 2005-2007 attained itsobjectives one year earlier thanexpected. The growth rate of the Group'sturnover for the period 2005-2006 cameto 6.7% per annum compared with thetarget of 4% and the gross operatingmargin came to 5.8% during 2006versus the target of 5% for 2007!

Nexans Hellas, despite the adversefinancial environment, managed toapproach the Group’s objectives andattained an annual growth rate ofturnover higher than 8% for the years2005-2006 and operating margin 5,5%for 2006 (at standard metal prices).

Further to the achievement of its strategicobjectives, the Group announced arevised strategic plan for 2007-2009which targets a total turnover -always atstandard metal prices- equal to EUR 5billion for the last year, operating marginequal to 7.5%, 13% return on capitalemployed and positive cash inflows. Inaddition to quantitative objectives, theGroup aspires to be established as oneof the most important cable manufacturerson a worldwide scale as forenergy networks,construction sector andthe industrial sectorsincorporating ourproducts in their ownend products.

It is self-evident thatour Company willactively participate in theachievement of these

objectives that automatically becomeours. This, however, will be attained if astrategy is prepared which will take intoconsideration the particularities of thearea in which we are active as well asthe recent changes in the economicenvironment of the country and neighborregions.

An important change lies in the fact thatNexans Hellas was forced to modify itsstrategy in relation to its majorclients–public corporations in Greecegiven that such corporations changed

2006 Annual Report � 09

Nexans Hel las�

significantly their procurement policyespecially after their partial or totalprivatization.

More specifically, the newprocurement policy of thesecorporations (DEI, OTE)focuses almost exclusively onthe prices offered, this beingthe most important criterion forselecting suppliers. Here it shouldbe stressed that pursuant to the paststatus of frame agreements with publiccorporations our company was obligedto provide a number of important servicesto such corporations (quality assurance,high level technical support, availablecapacity, fast service and others).

Nexans Hellas has participated intenders launched by public corporationsduring 2006, but did not accept tocompromise the offered quality of bothproducts and services. Therefore, thecompany was awarded and will beawarded few procurement contracts byDEI and OTE during 2006 and 2007respectively.

This, however, is a strong advantage ofNexans Hellas. More specifically, theselling prices of our products to publiccorporations during 2006 were almostalways loss-making and thereforeminimizing such sales was favorable forour company. Concurrently, incooperation with the respectivecompanies of Nexans Group, NexansHellas attained to be included in thetable of approved suppliers of electricityutilities located at Northern Europe(Scandinavia, Great Britain, Ireland, etc)and started supplying these corporationswith great success. Given that electricity

utilities of Northern Europe lay greatemphasis on the reliability of a supplier inconjunction with the quality of allmaterials and services provided, theimportance of the selling price isconsiderably diminished and, thus, profitmargins from these sales are increased toa satisfactory extent.

Another major advantage of NexansHellas lies in the completion of theCompany’s restructuring plan that startedduring 2004-2005 when the head office

was transferred at the plant at AghiaMarina (Fthiotis) and the structure of

all commercial, financial,technical and administrativeservices was reviewed, thusleading to a radicalrejuvenation of the company’shuman resources and toreplacement of the retired old

executives with new dynamic,fully trained and competent

executives.

Restructuring is supplemented by a seriesof investments in production equipmentthat enhances considerably our plant’sproductivity and capacity while takingadvantage of the know-how offered bythe respective services of Nexans Group. The offered know-how is applied to theplant at Fthiotis with great success, thusensuring a reduction in production costas regards both the consumption of rawmaterials and the use of humanresources.

In addition, organization programsdeveloped and proposed by the Group’sservices (Program+, Service+, etc) havealready been put into practice, theseaiming to improve the value addedservices provided to the Company’scustomers.

It is encouraging that the company’scustomers appreciate the quality of ourservices (fast service, thoroughness andquality of product types, delivery at therequested time and place, simplificationof bureaucratic procedures, etc) both inGreece (major merchants of electricalmaterial, construction firms) and abroad.

We foresee that Greek public

010� 2006 Annual Report

�Nexans Hel las

corporations will soon realize theimportance of quality services and willadopt similar selection criteria in theirtenders apart from price. In this case, thecompany will be ready to recover theposition held in the past as supplier ofpublic corporations.

It should also be noted that theCompany, in cooperation with theGroup’s commercial services, hasdeveloped and will keep on developingsales to developing neighbor countriessuch as the Balkans, Eastern Europe,North Africa and Middle East. The ever-increasing energy needs of thesecountries ensure a steadily increasingdemand for energy cables at a constantlyimproving price level.

Although it is evident that both the Groupand the Company focus their efforts ondevelopment in the sector of electricenergy cables, any emergingopportunities in telecom sector will beseized. We cannot possibly anticipatefor how long the sector will suffer from therecession noticed in telecommunicationsthe last few years but it is certain thatNexans Hellas is ready to participate inthe procurement of Greek andinternational telecom organizations oncecircumstances allow it.

It becomes clear from the foregoing thatwe are full of optimism and confidenceas for the achievement of the strategicplan objectives by both the Companyand the Group.

Orders

Orders backlog as at the end of 2006amounted to EUR 32.4 million. This

backlog amount does not take intoaccount the sales, which are made overthe counter.

Investments

The value of the company´s investments infixed assets during 2006 amounted toEUR 2.4 million compared with EUR 2.6million for 2005.

Our investments are mainly directed tonew products in order to satisfy marketand customers requirements, while someinvestments were intended for upgradeand/or replacement of existingproduction lines.

Research and Development

Our company participates constantly inthe Group Research & Developmentprograms. Research & Development arerelated to the promotion of new productsand to the improvement of existingproducts in terms of both quality andtechnical capabilities. R&D concern alsonew techniques and production methodsto increase productivity and it alsointroduce the use of newenvironment-friendlymaterials.

Contribution forthe participationof NexansHellas in theseglobalResearch &Developmentactivities for theyear 2006amounted to EUR1.7 million 2005.

2006 Annual Report � 011

Nexans Hel las�

The Research and DevelopmentCenter of Nexans Group is basedat Lyon, France, where the majorityof the Group’s research activitieshave been gathered. At the sametime, operation of developmentcenters continues in other Europeanlocations.

Furthermore, our above contributionin this international program alsocovers the marketing and salesnetwork established in certain

countries, which leads to abetter co-ordination of

Group companies inthese markets andwill reinforce oursales.

Personnel

The total workforceas at December 31,

2006 was 240compared to 237 at the end

of 2005. There were 45

departures during the year and 48 newemployees were hired during 2006. It isobvious that Nexans Hellas considers thecontinuous rejuvenation of its humanresources very important.

Real Estate

Land and Buildings belonging to thecompany at Aghia Marina (Fthiotis)remained unchanged during the yearwhile a part of the Company’s offices inAthens (Messoghion Avenue) was solddue to translocation of the Company’sAdministrative Services at its Plant.

012� 2006 Annual Report

�Nexans Hel las

Market Value

During 2006, the Composite Index ofAthens Stock Exchange presented asignificant stability in relation to2005.

This stability is due to the regularoperation of the Greek stock market,parallel reinforcement of internationalcapital markets and mainly to theprofitability of Greek enterprises, whichrose considerably.

Greek Market Value –Indicators concerning our company’sshares:

Note that Nexans Hellas does not makeany portfolio investments and is notengaged in trading on the stock market.

Results- Conclusions

Ladies and Gentlemen shareholders,We present to you the FinancialStatements of Nexans Hellas S.A. forthe business year 2006. TheseFinancial Statements have been drawn

up in accordance with theInternational Financial Reporting

Standards, as adopted by theEuropean Union, pursuant toRegulation (EC) 1606/2002 of theEuropean Parliament and the Councilof the European Union as at 19 July2002, which was published in theOfficial Journal of the EuropeanCommunities (L 243) and theRegulations issued by the EuropeanCommission, as authorized by articles3 and 6 of the said Regulation. In

2006 Annual Report � 013

Nexans Hel las�

Number of ordinary registered shares

as at 31 December 2006 6,132,500

as at 31 December 2005 6,132,500

Market value per share Euro

as at 31 December 2006 4.50

as at 31 December 2005 1.70

Capitalization EUR million

as at 31 December 2006 27.60

as at 31 December 2005 10.40

drawing up the Financial Statements,all the accrued income and expensesrelated to the business year have beentaken into account.

The results and appropriation table ofNEXANS HELLAS S.A. for the periodended December 31.12. 2006 are asfollows:

Profits appropriation table is asfollows:

All shareholders of the company, at thedate of this Ordinary General Assemblyare entitled to receive the above divi-dend.

The Board proposes that dividend distri-bution will take place as of July 2, 2007.

The announcement of the details regardingthe payment of the dividends will followthe necessary procedure according to theRegulations of the Athens Stock Market.

Finally, we wish to express our thanks toall our personnel for their outstandingcooperation. We also wish to thank ourshareholders and our customers for theirfull and continued confidence in ourcompany during these particularuncertain times.

014� 2006 Annual Report

�Nexans Hel las

(Euro Million)

2006 2005

Sales 119.01 88.13

Profit/(Loss) before taxes 2.95 (0.56)

Profit/(Loss) after taxes 3.00 (1.65)

PROFIT APPROPRIATION TABLE

π. Results as at 31/12/2005 carried forward 3.842.384,14

Net profit for the year 2006 2.950.377,15

PLUS Deferred income taxes 50.773,54

3.001.150,69 3.001.150,69

ππ. Profit for appropriation 6.843.534,83

·) Statutory reserves (3.001.150,69x5%) 150.058,00

‚) Net dividend (Shares 6.132.500x0,15) 919.875,00

Á) Tax on dividend 375.723,59

1.445.656,59 (1.445.656,59)

πII. Results as at 31/12/2006 carried forward 5.397.878,24

2006 Annual Report � 015

Nexans Hellas I.S.A.BALANCE SHEET DECEMBER 31, 2006

BALANCE SHEET FOR THE YEAR FROM 1 JANUARY TO 31 DECEMBER 2006

31.12.2006 31.12.2005

ASSETSFixed assets 15,420 16,908Stocks 21,684 11,104Trade receivables 27,937 27,841Other assets 3,522 5,914Cash and cash equivalents 3,085 1,007

----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

TOTAL ASSETS 71,648 62,774================ =================

LIABILITIESLong-term liabilities 3,380 3,556Other short-term liabilities 40,989 34,940

--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Total liabilities (a) 44,369 38,496--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Share capital 7,666 7,666Other equity items of Company’s shareholders 19,613 16,612

--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Total equity of Company’s shareholders (b) 27,279 24,278--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

TOTAL LIABILITIES (a) + (b) 71,648 62,774================ =================

INCOME STATEMENT FOR THE YEAR FROM 1 JANUARY TO 31 DECEMBER 2006

01.01-31.12.2006 01.01-31.12.2005

Turnover 119,010 88,134Gross profit / (loss) 10,228 6,285Profit/(loss) before tax, financing and investing results 4,233 167Profit/(loss) before tax, financing and investing results and depreciation 5,819 1,688Profit/(loss) before tax 2,950 (563)Plus/(Less) taxes 51 (1,084)

---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Post-tax profit/(loss) 3,001 (1,647)================ =================

STATEMENT OF CHANGES IN EQUITY FOR THE YEAR FROM 1 JANUARY TO 31 DECEMBER 2006

31.12.2006 31.12.2005

Published equity at the beginning of the period (01.01.2006 and 01.01.2005 respectively) 22,294 24,584Restated equity at the beginning of the period (01.01.2006 and 01.01.2005 respectively) 24,278 25,925Post-tax profit/(loss) of the period 3,001 (1,647)

------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Equity at the end of the period (31.12.2006 and 31.12.2005 respectively) 27,279 24,278================ =================

016� 2006 Annual Report

Hellas I.S.A.DATA AND INFORMATION ON 31-12-2006- Period (1 January - 31 December 2006)

SA Register No: 2176/06/B/86/06Registered offices: 15, Messoghion Avenue -11526 Athens

(The amounts below are stated in thousand Euro)

2006 Annual Report � 017

Nexans Hel las�

CASH FLOW STATEMENT FOR THE YEAR FROM 1 JANUARY TO 31 DECEMBER 2006

01.01-31.12.2006 01.01-31.12.2005

Operating activities

Profit/(Loss) before tax 2,950 (563)Plus/(Less) adjustments for:Depreciation 1,586 1,521Impairement loss from stocks 1,830 0 Provisions 688 381Foreign exchange differences 11 (30)(Profit)/Loss on sale of fixed assets (115) 0Results (revenues, expenses, profit and loss) of investing activity (39) (246)Interest charges and related expenses 1,217 602(Profit)/Loss from derivatives valuation 835 (1,333)Plus/(Less) adjustments for changes in working capital accounts:Decrease/(increase) in inventories (11,722) (949)Decrease/(increase) in receivables 1,947 (1,016)(Decrease)/increase in liabilities (save banks) 1,195 3,144Less:Interest payments (1,033) (667)Indemnities paid (469) (344)Taxes paid-up 0 (263)

------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Total inflow/(outflow) from operating activities (a) (1,119) 237================ =================

Investing activities

Purchase of intagible and tangible assets (2,370) (2,600)Collections from the sale of fixed assets 155 0Proceeds on sale of investments 0 472Interest received 57 145

------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Total inflow/(outflow) from investing activities (b) (2,158) (1,983)================ =================

Financing activities

Proceeds on loans issued/taken out 5,300 700Dividends paid (17) (3)

------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Total input/(output) from financing activities (c) 5,283 697================ =================

Net increase/(decrease) in cash and cash equivalents of the period (a) + (b) + (c) 2,006 (1,049)================ =================

Exchange differences on foreign currencies receivables 72 353================ =================

Cash and cash equivalents at the beginning of the period 1,007 1,703================ =================

Cash and cash equivalents at the end of the period 3,085 1,007================ =================

018� 2006 Annual Report

�Nexans Hel las

∞thens, 23/03/2007

THE CHAIRMAN. VICE CHAIRMAN THE FINANCIAL &OF THE BOARD OF DIRECTORS & MANAGING DIRECTOR ADMINISTRATIVE MANAGER

YVON RAAK DEMETRIOS KALOGERAS VASSILIOS PSILIANGOS

Additional data and information:

1. The Company has been audited in tax terms up to the fiscal year 2000 and, therefore, its tax liabilities are not definite yet.2. There are no liens or other liabilities on the company's fixed assets.3. There are no disputed claims or disputes under arbitration or any decisions made by judicial or arbitral bodies that may have an impact on the

Company's financial assets.4. Pursuant to the analysis of the National Statistical Service (Statistical Classification per Sector of Economic Activity: 91) the main activity of the

group falls under sector 313.0 "Manufacture of isolated wires and cables".5. On 31 December 2006, the headcount of the company was 240. 6. The break down of the income tax in the Income Statement is as follows:

31/12/2006 31/12/2005Current income tax 0 (48)Deferred income taxes 51 (1.036)Total tax 51 (1.084)

7. The Intercompany transactions sales, purchases for the full year and the Intercompany receivables and payables as at the period end, accordingto IAS 24, are as follows: i) Sales of goods and services: 8.106ii) Purchases of goods and services: 46.445iii) Receivables: 3.371iv) Liabilities: 24.012v) Fees paid to Managers as members of the BoD: 244vi) Receivables from Managers as members of the BoD: 0vii) Payables to Managers as members of the BoD: 0

Report on the FinancialStatements

We have audited the accompanyingfinancial statements of NEXANS HELLASS.A. (the “Company”) which comprisethe company balance sheet as of 31December 2006 and the incomestatement, statement of changes in equityand cash flow statement for the year thenended and a summary of significantaccounting policies and otherexplanatory notes.

Management’s Responsibility forthe Financial Statements

Management is responsible for thepreparation and fair presentation of thesefinancial statements in accordance withInternational Financial ReportingStandards as adopted by EU. Thisresponsibility includes: designing,implementing and maintaining internalcontrol relevant to the preparation andfair presentation of financial statementsthat are free from material misstatement,whether due to fraud or error; selectingand applying appropriate accountingpolicies; and making accountingestimates that are reasonable in thecircumstances.

Auditor’s Responsibility

Our responsibility is to express anopinion on these financial statementsbased on our audit. We conducted our

audit in accordance with Greek auditingstandards which conform withInternational Standards on Auditing.Those Standards require that we complywith ethical requirements and plan andperform the audit to obtain reasonableassurance whether the financialstatements are free from materialmisstatement.

An audit involves performing proceduresto obtain audit evidence about theamounts and disclosures in the financialstatements. The procedures selecteddepend on the auditor’s judgment,including the assessment of the risks ofmaterial misstatement of the financialstatements, whether due to fraud or error.In making those risk assessments, theauditor considers internal control relevantto the entity’s preparation and fairpresentation of the financial statements inorder to design audit procedures that areappropriate in the circumstances, but notfor the purpose of expressing an opinionon the effectiveness of the entity’s internalcontrol.

An audit also includes evaluating theappropriateness of accounting policiesused and the reasonableness ofaccounting estimates made bymanagement, as well as evaluating theoverall presentation of the financialstatements.

We believe that the audit evidence wehave obtained is sufficient and

appropriate to provide a basis for ouraudit opinion.

Opinion

In our opinion, the accompanyingfinancial statements present fairly, in allmaterial respects, the financial position ofthe Company as of 31 December 2006,and of their financial performance andcash flows for the year then ended inaccordance with International FinancialReporting Standards, as adopted by theEU.

Report on Other Legal andRegulatory Requirements

The information included in the Board ofDirectors’ Report is consistent with theaccompanying financial statements.

Athens, 26 March 2007

The certified auditor-accountantKonstantinos MichalatosSOEL reg. No 16511

PricewaterhouseCoopersAuditing SA

Certified Auditors Accountants

2006 Annual Report � 019

Nexans Hel las�

Auditors Report to the Shareholders of the “NEXANS HELLAS I.S.A.” �

Nexans Hellas is involved in themanufacturing of various types of landbased power and telecommunicationcables and submarine telecommunicationcables. In addition the company providesall the necessary services of engineeringand installation for power andtelecommunication projects.

Accounting PoliciesThe accounting policies adopted for thepreparation of the financial statementsare in accordance with the InternationalFinancial and Reporting Standards, asadopted by the European Union,pursuant to Regulation (EC) 1606/2002of the European Parliament and theCouncil of the European Union as at 19July 2002, which was published in theOfficial Journal of the EuropeanCommunities (L 243) and the Regulationsissued by the European Commission, asauthorized by articles 3 and 6 of thesaid Regulation.

1. Translation of foreign currencytransactions

Foreign currency transactions aretranslated in Euro at the rate of exchangeapplicable on the transaction date. Atyear end, foreign currency receivablesand payables are translated at the rate ofEuro Foreign Currency prevailing on thatdate. The resulting realized exchangedifferences are recorded in the profit andloss account.

2. Fixed AssetsThe Company used the acquisition cost

of tangible assets increased by legaladjustments until transition date asimputed cost, according to the exceptiongranted by IFRS 1.

In addition, the Company determineddepreciation rates on the basis of thecost-effective useful life of tangible assetsas of acquisition or construction date.Accumulated depreciation until transitiondate was redetermined so as to reflectthe new useful life and the resultantdifference was posted to the resultscarried forward.

3. Accounts receivablesReceivables are shown at their netrealisable value.

4. InventoriesInventories are valued at the lower of costor market value. Cost is computed on firstin - first out method (FIFO).

5. Accrued income / accruedliabilities, prepayments, deferredincome

Provision has been made for relativecosts, expenses, and income for thestated period.

6. Retirements and staff leavingobligations

This is calculated on the basis of amountsaccruing under legal and contractualobligations.

7. Reserves and provisionsAll known liabilities have been provided

for on a prudent basis as required byGreek legislation and the InternationalAccounting Standards.

020� 2006 Annual Report

�Nexans Hel las

Notes to the Financial Statements as at December 31, 2006 �