16th Aug 2006 07:01
Telecom Egypt S.A.E16 August 2006 Auditor's Limited Review Report To The Board of Directors Of Telecom Egypt Company (An Egyptian Joint Stock Company) We have performed a limited review on the accompanying consolidated balancesheet of Telecom Egypt Company - an Egyptian joint stock company - as of June30, 2006 and the related consolidated statements of income, cash flows andchanges in equity for the financial period then ended. These financialstatements are the responsibility of the company's management. Ourresponsibility is to issue a report on these financial statements based on ourreview. Our review was made in accordance with the Egyptian Standard on Auditingrelating to the limited review. This standard requires that we plan and performthe review to obtain reasonable assurance that the financial statements are freeof material misstatement. Our review work is limited to obtaining the requiredinformation from company's personnel and analytical procedures applied forfinancial data and thus provide less assurance than the audit procedures appliedaccording to the Egyptian Standards on Auditing for the purpose of issuing anopinion on the financial statements and, accordingly, we do not express an auditopinion. Based on our limited review for the consolidated financial statements of TelecomEgypt Company for the period ended June 30, 2006 nothing has come to ourattention that causes us to believe that the accompanying consolidated financialstatements are not presented fairly in all material respects in accordance withEgyptian Accounting Standards. KPMG Hazem Hassan Public Accountants & Consultants Cairo, August 10, 2006 Telecom Egypt Company (An Egyptian Joint Stock Company) Consolidated Financial Position As of June 30, 2006 Note 30/6/2006 31/12/2005 No. LE(000) LE(000)Long-Term AssetsFixed assets (net) (4) 21 072 083 21 833 589Projects in progress (5) 1 257 511 1 146 797Investments in affiliates (3-6),(6-1) 1 303 285 1 301 785Available for sale investments (3-7),(6-2) 96 635 95 197Long-term other receivables (7) 1 085 123 1 512 901Other assets (net) (3-9),(8) 155 749 126 769Total Long Term Assets 24 970 386 26 017 038 Current AssetsInventory (9) 468 951 494 776Trade and notes receivable (10) 2 768 753 2 559 673Debtors and other debit accounts (11) 2 703 339 2 160 735Investments held for trading (12) 192 327Cash on hand and at banks (13) 1 139 308 768 016Total Current Assets 7 272 678 5 983 200 Current LiabilitiesLoan instalments and facilities due within one (14) 392 118 476 487yearBanks - credit accounts 327 562 419 061Banks overdraft 86 354 158 474Suppliers & notes payable (15) 92 269 103 768Dividends payable 655 724 36 593Creditors and other credit (16-1) 2 800 284 2 926 577accountsProvisions (17) 1 259 283 1 255 653Total Current Liabilities 5 613 594 5 376 613Working capital 1 659 084 606 587Total investments 26 629 470 26 623 625 Financed as follows:-Equity and long-term liabilitiesEquityPaid up capital (19) 17 070 716 17 070 716Reserves (20) 4 159 874 3 416 774Retained earnings 566 327 403 611Translation difference ( 112) ( 78)adjustmentsNet profit for the period / year 1 111 579 1 858 019Total equity attributable to equity holders of 22 908 384 22 749 042the parentMinority Interest 30 544 22 031Total Equity 22 938 928 22 771 073 Long-Term LiabilitiesLoans and credit facilities (14) 1 565 948 1 734 821Bonds loan (21) 2 000 000 2 000 000Creditors and other credit (16-2) 57 075 56 459accountsDeferred tax liabilities (3-23),(22) 67 519 61 272Total Long-Term Liabilities 3 690 542 3 852 552Total Equity and Long-Term Liabilities 26 629 470 26 623 625 The accompanying notes from No. (1) to No. (39) form an integral part of these financial statements. Chairman Deputy chairman for Financial & Head of the financial sector Commercial Affairs Eng./Akil Beshir Acc./Ali Salama Acc./Ali Barakat Date : August 7, 2006 Auditor's Limited Review Report "Attached" Telecom Egypt Company (An Egyptian Joint Stock Company) Consolidated Income Statement For The Financial Period Ended June 30, 2006 For the For the financial period financial period from 1/1/2006 from 1/1/2005 Note to 30/6/2006 to 30/6/2005 No. LE(000) LE(000)Operating RevenuesSales of services (23) 4 427 533 4 038 276Sales of telephone sets & directories 43 483 69 530 4 471 016 4 107 806Operating ExpensesInterconnection fees (24) 631 479 579 035Fuel 27 096 24 052Spare parts 64 463 55 157Maintenance 36 936 42 210Satellite subscriptions 11 327 8 242Depreciation (4) 1 309 092 1 247 585Amortization (8) 15 306 14 747Cost of telephone sets & directories sold 54 226 81 343Other operating costs (25) 603 953 486 663 2 753 878 2 539 034Gross Operating Profit 1 717 138 1 568 772 Administrative expensesGeneral & administrative expenses (26) 456 318 387 920Selling & distribution expenses (27) 120 662 83 550Provisions (17) 10 996 40 316Impairment loss on trade and other receivables (18) 38 231 38 360 626 207 550 146Net Operating Profit 1 090 931 1 018 626 Other Income / (Expenses)Interest income 22 850 10 570Income from investments 338 881 137 111Interest expenses ( 141 706) ( 200 181)Other revenues (28) 137 127 51 208Reversal of impairment loss on available for sale 1 437investmentsImpairment loss on available for sale investments ( 3 006)Gain on sale of investments 979 20 941Increase of market value of held for trading 5 898investmentsGain on sale of fixed assets 41 758Foreign exchange ( loss) gain ( 82 223) 298 700Release of unused provision 157 283 284 316 258Net profit for the period before tax & minority 1 374 215 1 334 884interestLess:Current tax expense 255 450 295 304Deferred tax expense 6 092Net profit before minority interest 1 112 673 1 039 580Less:Minority interest 1 094 1 523Net profit for the period after tax & minority 1 111 579 1 038 057interestEarnings per share (LE/Share) (31) 0.65 0.61 The accompanying notes from No. (1) to No. (39) form an integral part of these financial statements. Telecom Egypt Company (An Egyptian Joint Stock Company) Consolidated Statement of Cash Flows For The Financial Period Ended June 30, 2006 For the For the financial period financial period from 1/1/2006 from 1/1/2005 Note to 30/6/2006 to 30/6/2005 No. LE(000) LE(000)Cash flows from operating activitiesCash receipts from trade receivables 3 636 071 3 689 944Sales tax collected from trade receivables 240 053 205 244Stamp tax and fees collected (from third party) 71 153 67 408Deposits received from trade receivables 25 753 28 039Cash paid to suppliers ( 348 173) ( 281 616)Cash paid to employees ( 517 782) ( 455 961)Cash paid on behalf of employees ( 165 053) ( 147 566)Dividends paid to shareholders & employees ( 272 241) ( 469 492)Net cash from operating activities 2 669 781 2 636 000 Interest paid ( 164 634) ( 262 861)Payments to corporate Tax Authority ( 480 066) ( 294 801)Payments to Sales Tax Authority ( 438 444) ( 366 621)Other proceeds /(payments) net ( 53 878) 184 931Net cash provided by operating activities 1 532 759 1 896 648 Cash flows from investing activitiesPayment for purchase of property, plant & equipment ( 737 788) (1 065 498) and projects in progressProceeds from sale of property plant & equipment and 1 611 1 986other assetsPayments for purchase of investments ( 221 949) ( 669 094)Proceeds from sale of investments 35 000 88 294Interest received 18 771 7 184Dividends received 156 097 27 130Net cash used in investing activities ( 748 258) (1 609 998) Cash flows from financing activitiesRepayment of borrowings & facilities relating to ( 214 970) ( 454 607) acquisition of property, plant & equipment, projects in progress and intangible assets.Repayment of other borrowings & facilities ( 23 148) (1 506 116)Payments by minority for capital increase in 9 615 3 256 subsidiary companiesProceeds from long - term loans 29 531Proceeds from long - term bonds issued 2 000 000Repayment of banks credit accounts ( 91 050) ( 998 341)Payment of financial lease obligations ( 22 120) ( 13 194)Payments of long-term obligations 616Net cash used in financing activities ( 341 057) ( 939 471) Translation difference adjustments ( 32) ( 86) Net Increase (Decrease) in cash and cash equivalents during the 443 444 ( 652 821)periodCash and cash equivalents at the beginning of the period (32) 609 542 1 104 560Cash and cash equivalents at the end of the period (32) 1 052 954 451 653 The accompanying notes from No.(1) to No. (39) form an integral part of thesefinancial statements. Telecom Egypt Company (An Egyptian Joint Stock Company) Consolidated Statement Of Changes In Equity For The Financial Period Ended June 30, 2006 Paid up Legal Other Revaluation Retained Translation Net Total equity Minority Total capital reserve reserves reserve earnings difference profit attributable interest equity adjustments to equity holders of the parent LE(000) LE(000) LE(000) LE(000) LE(000) LE(000) LE(000) LE(000) LE(000) LE(000) Balance as of 17 112 149 322 347 4 308 086 16 819 415 281 ( 34) 1 025 167 23 199 815 17 940 23 217 7551/1/2005Adjustments to ( 11 742) ( 11 742) ( 11 742)retained earningsMinority interest's 2 661 2 661share in capital increaseTransferred to 51 390 410 014 ( 461 404)reservesDividends for the ( 25 901) ( 548 312) ( 574 213) ( 834) ( 575 047)year 2004Adjustment to ( 10 005) 10 005revaluation surplus of solid investmentsReducing of other (1 723 339) (1 723 339) (1 723 339)reserves against decrease in the land& other assets according to the Extraordinary General Assembly resolution on 21/9/2005Reducing the ( 41 433) 41 433share capital according to the Extraordinary General Assemblyresolution on 21/9/2005Transferred from 29 455 484 ( 484)minority interest due to the change incapital shareholdingpercentageTransferred to retained 15 504 ( 53) ( 15 451)earnings Translation difference 9 9 18 ( 6) 12adjustmentsNet profit for the 1 858 019 1 858 019 2 754 1 860 773year 2005 Balance as of 17 070 716 373 766 3 036 194 6 814 403 611 ( 78) 1 858 019 22 749 042 22 031 22 771 07331/12/2005 Adjustments to 246 246 ( 76) 170retained earningsMinority interest's 9 615 9 615share in capital increase of subsidiary companyTransferred from 36 481 517 ( 517)minority interest due to the change incapital shareholdingpercentageTransferred to 93 064 650 000 ( 743 064)reservesDividends for ( 1 394) ( 951 576) ( 952 970) ( 1 605) ( 954 575)the year 2005Transferred to 163 383 ( 4) ( 163 379)retained earnings Translation difference ( 30) ( 30) 3 ( 27)adjustmentsNet profit for 1 111 579 1 111 579 1 093 1 112 672the period Balance as of 17 070 716 466 866 3 686 194 6 814 566 327 ( 112) 1 111 579 22 908 384 30 544 22 938 92830/6/2006 The accompanying notes from No. (1) to No. (39) form an integral part of these financial statements. To access the accompanying notes to these financial statements from No. (1) toNo. (39), please copy and paste the following link into your web browser: http://www.rns-pdf.londonstockexchange.com/rns/7129h_-2006-8-15.pdf This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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