CONSOLIDATED
STATEMENT OF
COMPREHENSIVE INCOME
Selected financial results of PGE Capital Group

The principles of drawing up summary consolidated financial statements

The presented summary consolidated financial statements constitute only a summary of the information included in the Annual Report of the Capital Group of PGE Polska Grupa Energetyczna S.A. for the year 2014. They are not financial statements provided for in the Statutes and do not include sufficient information for the complete understanding of the financial results of the Capital Group of PGE Polska Grupa Energetyczna S.A. Such information is included in the complete Annual Report for the year 2014.

The consolidated financial statements of the Capital Group of PGE Polska Grupa Energetyczna S.A. were prepared in accordance with the International Financial Reporting Standards.

Additional information
The 2014 Annual Report is available on the Company’s website A copy of the 2014 Annual Report can be obtained in the registered office of PGE Polska Grupa Energetyczna S.A. at 2 Mysia Street in Warsaw.


CEO’s comment on FY 2014 results.

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

Year ended
31 December 2014
Year ended
31 December 2013
restated*
STATEMENT OF PROFIT OR LOSS

SALES REVENUES 28,137 30,145
Costs of goods sold (21,546) (23,360)
GROSS PROFIT ON SALES 6,591 6,785
Other operating revenues 1,561 802
Distribution and selling expenses (1,540) (1,244)
General and administrative expenses (831) (795)
Other operating expenses (685) (701)
OPERATING PROFIT 5,096 4,847
Financial income 385 314
Financial expenses (868) (313)
Share of profit of associates - (1)
PROFIT BEFORE TAX 4,613 4,847
Income tax (956) (876)
NET PROFIT FOR THE REPORTING PERIOD 3,657 3,971
OTHER COMPREHENSIVE INCOME

Other comprehensive income, which may be
reclassified to profit or loss, including:


Valuation of hedging instruments (75) -
Foreign exchange differences from translation of foreign entities (1) 1
Deferred tax 14 -
Other comprehensive income, which will not be reclassified
to profit or loss, including:


Actuarial gains and losses from valuation of provisions for employee benefits (397) 311
Deferred tax 75 (59)
OTHER COMPREHENSIVE INCOME FOR THE REPORTING PERIOD, NET (384) 253
TOTAL COMPREHENSIVE INCOME 3,273 4,224
NET PROFIT ATTRIBUTABLE TO:

– equity holders of the parent company 3,638 3,948
– non-controlling interest 19 23
COMPREHENSIVE INCOME ATTRIBUTABLE TO:

– equity holders of the parent company 3,255 4,200
– non-controlling interest 18 24
EARNINGS AND DILUTED EARNINGS PER SHARE ATTRIBUTABLE TO EQUITY
HOLDERS OF THE PARENT COMPANY (IN PLN)
1.95 2.11


CONSOLIDATED STATEMENT OF FINANCIAL POSITION

As at
31 December
2014
As at
31 December
2013
restated*
As at
1 January
2013
restated*
NON-CURRENT ASSETS


Property, plant and equipment 49,738 46,127 44,323
Investment property 33 22 28
Intangible assets 763 718 513
Loans and receivables 13 392 329
Available-for-sale financial assets 15 25 33
Shares in associates accounted for
under the equity method
9 9 40
Other non-current assets 1,228 644 359
Deferred tax assets 383 302 367
TOTAL NON-CURRENT ASSETS 52,182 48,239 45,992
CURRENT ASSETS


Inventories 2,175 1,684 2,200
CO2 emission rights 1,552 1,404 791
Income tax receivables 46 9 9
Short-term financial assets at fair
value through profit or loss
11 104 19
Trade receivables 1,729 2,192 1,895
Other loans and financial assets 1,180 903 768
Available-for-sale financial assets 16 9 4
Other current assets 1,012 748 807
Cash and cash equivalents 6,282 5,952 4,795
Assets classified as held-for-sale 16 8 9
TOTAL CURRENT ASSETS 14,019 13,013 11,297
TOTAL ASSETS 66,201 61,252 57,289
EQUITY


Share capital 18,698 18,698 18,698
Revaluation on financial assets and hedging reserves (61) - -
Foreign exchange differences from translation of foreign entities (1) - 4
Reserve capital 9,231 8,941 9,688
Other capital reserves - 50 50
Retained earnings 16,901 15,851 12,605
EQUITY ATTRIBUTED TO EQUITY HOLDERS OF
THE PARENT COMPANY
44,768 43,540 41,045
Non-controlling interests 116 268 299
TOTAL EQUITY 44,884 43,808 41,344
NON-CURRENT LIABILITIES


Non-current provisions 6,099 4,766 4,870
Interest-bearing loans and borrowings,
bonds and lease
4,688 1,994 1,085
Deferred tax liabilities 2,090 1,702 1,625
Deferred income and
government grants
1,158 1,181 1,125
Other financial liabilities 16 11 23
TOTAL NON-CURRENT LIABILITIES 14,051 9,654 8,728
CURRENT LIABILITIES


Current provisions 2,070 2,435 1,709
Interest-bearing loans and borrowings,
bonds and lease
357 528 811
Financial liabilities at fair value
through profit or loss
117 24 37
Trade liabilities 1,179 935 1,202
Income tax liabilities 81 155 231
Deferred income and government grants 142 151 123
Other current financial liabilities 1,953 1,944 1,546
Other current non-financial liabilities 1,367 1,618 1,558
TOTAL CURRENT LIABILITIES 7,266 7,790 7,217
TOTAL LIABILITIES 21,317 17,444 15,945
TOTAL EQUITY AND LIABILITIES 66,201 61,252 57,289


CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

EQUITY ATTRIBUTED TO EQUITY HOLDERS OF THE PARENT COMPANY

Share
capital
Revaluation
reserve on
financial
instruments
Foreign
exchange
differences
from translation
Reserve
capital
Other
capital
reserves
Retained
earnings
Total Non-
contro-
lling
interests
Total
equity
AS AT 1 JANUARY 2014 18,698 - - 8,941 50 15,851 43,540 268 43,808
Profit for the reporting period - - - - - 3,638 3,638 19 3,657
Other comprehensive income - (61) (1) - - (321) (383) (1) (384)
COMPREHENSIVE INCOME
FOR THE PERIOD
- (61) (1) - - 3,317 3,255 18 3,273
Retained earnings distribution - - - 290 (50) (240) - - -
Dividend - - - - - (2,057) (2,057) (4) (2,061)
Changes within the PGE Group - - - - - - - (17) (17)
Purchase of additional shares
in the PGE Group companies
- - - - - 15 15 (148) (133)
Other changes - - - - - 15 15 (1) 14
TRANSACTIONS WITH OWNERS FOR THE PERIOD - - - 290 (50) (2,267) (2,027) (170) (2,197)
AS AT 31 DECEMBER 2014 18,698 (61) (1) 9,231 - 16,901 44,768 116 44,884


EQUITY ATTRIBUTED TO EQUITY HOLDERS OF THE PARENT COMPANY

restated* Share
capital
Foreign
exchange
differences
from translation
Reserve
capital
Other
capital
reserves
Retained
earnings
Total Non-
contro-
lling
interests
Total
equity
AS AT 1 JANUARY 2013 18,698 4 9,688 50 12,605 41,045 299 41,344
Profit for the reporting period - - - - 3,948 3,948 23 3,971
Other comprehensive income - 1 - - 251 252 1 253
COMPREHENSIVE INCOME
FOR THE PERIOD
- 1 - - 4,199 4,200 24 4,224
Retained earnings distribution - - 77 - (77) - - -
Dividend - - (824) - (784) (1,608) (2) (1,610)
Changes within the PGE Group - (5) - - (5) (10) 14 4
Impact of the mergers of
companies within the Group
- - - - 3 3 (3) -
Purchase of additional shares
in the PGE Group companies
- - - - - - (62) (62)
Other changes - - - - (90) (90) (2) (92)
TRANSACTIONS WITH OWNERS
FOR THE PERIOD
- (5) (747) - (953) (1,705) (55) (1,760)
AS AT 31 DECEMBER 2013 18,698 - 8,941 50 15,851 43,540 268 43,808


CONSOLIDATED STATEMENT OF CASH FLOWS

Year ended
31 December 2014
Year ended
31 December 2013
restated*
CASH FLOW FROM OPERATING ACTIVITIES

Profit before tax 4,613 4,847
Income tax paid (635) (827)
Adjustments for:

Shares in profit of associates accounted for
under the equity method
- 1
Depreciation, amortization and impairment losses 3,024 2,982
Interest and dividend, net 56 18
Profit / loss on investment activities 550 (113)
Change in receivables 135 (504)
Change in inventories (508) 516
Change in liabilities, excluding loans and bank credits (541) 228
Change in other non-financial assets,
prepayments and CO2 emission rights
(472) (533)
Change in provisions 9 1,024
Other 102 302
NET CASH FROM OPERATING ACTIVITIES 6,333 7,941
CASH FLOW FROM INVESTING ACTIVITIES

Disposal of property, plant and equipment and intangible assets 44 44
Purchase of property, plant and equipment and intangible assets (6,376) (4,619)
Disposal of financial assets - 9
Deposits with a maturity over 3 months (2,116) (99)
Termination of deposits over 3 months 2,191 10
Purchase of financial assets and increase
in shareholding in the PGE Group companies
(111) (18)
Purchase/ disposal of subsidiaries
after deduction of acquired/disposed cash
28 (1,063)
Dividends received 3 2
Interest received 17 1
Loans repaid (2) 1
Loans granted - (4)
Other 26 19
NET CASH FROM INVESTING ACTIVITIES (6,296) (5,717)
CASH FLOW FROM FINANCING ACTIVITIES
Proceeds from loans, bank credits
and issue of bonds
2,950 1,429
Repayment of loans, bank credits, bonds and finance lease (530) (816)
Dividends paid (2,061) (1,610)
Interest paid (84) (46)
Other 9 (23)
NET CASH FROM FINANCING ACTIVITIES 284 (1,066)
NET CHANGE IN CASH AND CASH EQUIVALENTS 321 1,158
Effect of foreign exchange rate changes, net 8 (6)
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE PERIOD 5,948 4,790
CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD 6,269 5,948
Restricted cash 368 403
* For information regarding restatement of comparative figures please refer to note A.3 of these financial statements
Difference between cash and cash equivalents in the statement of financial position and in the statement of cash flows results from interests accrued but not received as at the balance sheet date and from unrealized exchange difference