Letter from the Chairman of the Supervisory Board
Grupa LOTOS deserves high marks for its performance in 2013. Despite the precarious economic climate and challenging market conditions, the Company was able to generate operating profit and effectively deleverage its business. Even more importantly, it was successful in the consistent pursuit of its strategy to build Grupa LOTOS' value and improve Poland's energy security. Together with Grupa Azoty, the Company also made the first step towards embarking on a major petrochemical project.
Particularly worthy of note is the consistency with which Grupa LOTOS delivered on its strategic objectives – it was steadily increasing its own crude oil production, maintained robust competitiveness of its refining business by steadily improving the refinery's efficiency, enhanced its market position − on the market of both motor fuel (an 8.5% share in retail sales) and aviation fuel − and was gradually reducing its debt (now at 62% of equity). Grupa LOTOS boasts the sixth highest sales revenue in Central Europe, and fifth highest in Poland.
The growing value of the LOTOS brand, driven both by business efforts and the long-term corporate social responsibility (CSR) strategy, is also to be appreciated. This responsible and transparent approach of Grupa LOTOS towards various stakeholder groups is cited as a paragon of modern business practices. The 2013–2015 Effective and Rising Programme, which opens new growth prospects for Grupa LOTOS in the medium and long term, is yet another example of the Board's ability to explore and successfully implement original and innovative solutions, improving the overall operating efficiency of both the Company and the LOTOS Group. The programme focuses on key investment projects and on restructuring the LOTOS Group in those areas where this would make business sense. By successfully delivering on both these objectives, Grupa LOTOS has been able to improve its efficiency and competitiveness.
Essential to securing the Company's future growth is stable employment and a high level of professional competence and experience of its Board Members and the management staff of its subsidiaries. This creates a positive work atmosphere across all levels – from managers to lower-tier staff. Grupa LOTOS employees are visibly proud to work for the Company and deeply committed to its further growth. This combination of the rational and the emotional in corporate management is a rare and extremely valuable asset.
Given the consistently implemented strategy, highly professional management staff and dedication of employees, I am convinced that the future of Grupa LOTOS will bring further dynamic growth of its value and market shares. Grupa LOTOS will remain a robust and reliable presence in Poland's economy, a driver of its modern and sustainable growth.
Chairman of the Supervisory Board