Given the difficult conditions persisting on the European financial markets, which may result in an economic slowdown in Poland, and with the intention to ensure the Group’s secure development, Grupa LOTOS is implementing the Optimal Expansion Programme for 2012 (“the Programme”). The Programme provides for the launch of a number of projects designed to improve the efficiency of the Group’s operations. One of the initiatives planned as part of the Programme is to reduce expenditure by:
- reducing the increase in headcount to a level required in connection with the development projects,
- lowering the administrative, marketing and sponsorship costs,
- executing projects aimed to improve the efficient use of assets.
These measures will result in freezing or reducing certain cost groups despite an increase in the Group’s scale of operations. The effect of these steps and of the planned freezing of some investments is estimated at approximately PLN 220m in 2012. The planned measures will not restrict the development of strategic projects, such as exploration for and production of hydrocarbons or expansion of retail operations.
The measures described above are designed to reduce the ratio of the indicated cost groups to sales revenue derived from the increase in crude throughput to 9.17 million tonnes in 2011 and its further increase planned for 2012.
Moreover, the LOTOS Group is going to carry out restructuring projects, aimed to permanently enhance its operational efficiency.
In pursuance of its strategy to focus on the core business, Grupa LOTOS sold its shares in LOTOS Parafiny Sp. z o.o. In the transaction, completed on January 10th 2012, Grupa LOTOS S.A. sold 100% of its shares to Krokus Chem Sp. z o.o., in which the Nova Polonia Natexis II fund and the management staff of LOTOS Parafiny hold interests. As part of the transaction, a seven-year contract was concluded on November 29th 2011 whereby Grupa LOTOS is to supply slack waxes to LOTOS Parafiny Sp. z.o.o. (see Grupa LOTOS’ Current Report No. 37/2011 of November 30th 2011).
The legal basis for the publication of this Current Report is Par. 56.1.1 of the Act on Public Offering, Conditions Governing the Introduction of Financial Instruments to Organised Trading, and Public Companies, dated July 29th 2005, as amended (Dz. U. No. 184, item 1539).