~ Hazem Hassan Public Accountants & Consultants Consolidated ...

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~ Hazem HassanPublic Accountants & Consultants

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n

Consolidated financial statementsfor the year ended December 31,2013

&Auditor's report

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Citadel Capital Company(Egyptian Joint Stock Company)

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3

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5-88

Page

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Contents

Auditor's report

Consolidated balance sheet

Consolidated income statement

Consolidated statement of changes in equity

Consolidated statement of cash flows

Accounting policies and notes to the consolidated financial statements

I

Auditor's responsibility

Our responsibility is to express an opinion on these consolidated financial statementsbased on our audit. We conducted our audit in accordancewith the Egyptian Standardson Auditing and in the light of the prevailing Egyptian laws. Those standards requirethat we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance whether the financial statements are free from materialmisstatement.I

These consolidated financial statements are the responsibility of Company'smanagement. Management is responsible for the preparation and fair presentation ofthese financial statements in accordancewith the EgyptianAccountingStandards and inthe light of the prevailing Egyptian laws, management responsibility includes,designing, implementing and maintaining internal control relevant to the preparationand fair presentation of financial statements that are free from material misstatement,whether due to fraud or error; management responsibility also includes selecting andapplying appropriate accounting policies; and making accounting estimates that arereasonable in the circumstances.I

Management's responsibility for the financial statements

We have audited the accompanyingconsolidated financial statementsof Citadel CapitalCompany (Egyptian Joint Stock Company) and its subsidiaries, which comprise theconsolidated balance sheet as at December 31, 2013 and the consolidatedstatements ofincome, changes in equity and cash flows for the financial year then ended, and asummary of significant accountingpolicies and other explanatorynotes.

Report Oll the financial statements

Auditor's reportTo the Board of Directors of Citadel Capital Company

Telephone : (202)35 36 22 00 - 35 36 22 11Telefax: (202)35 36 23 01 - 3536 23 05E-mail: [email protected]: 12556AI Ahram

Pyramids Heights Office ParkKm 22 Cairo/Alex RoadP.O.Box 48 AI AhramGiza - Cairo - Egypt

Hazem HassanPublic Accountants & Consultants

III

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Cairo May 15,2014

KPMGHazemHassan

Opinion

In our opinion, the consolidated financial statements referred to above present fairly, inall material respects, the consolidatedfinancial positionof Citadel Capital Company andits subsidiaries as at December 31, 2013 and of its consolidated financial performanceand its consolidated cash flows for the year then ended in accordancewith the EgyptianAccounting Standards and the Egyptian laws and regulations relating to the preparationof these financial statements.

An audit involves performing procedures to obtain audit evidence about the amountsand disclosures in the financial statements. The procedures selected depend on theauditor'sjudgment, includingthe assessmentof the risks of materialmisstatementof thefinancial statements, whether due to fraud or error. In making those risk assessments,the auditor considers internal control relevant to the entity's preparation and fairpresentation of the financial statements in order to design audit procedures that areappropriate in the circumstances,but not for the purposeof expressingan opinion on theeffectiveness of the entity's internal control. An audit also includes evaluating theappropriateness of accounting policies used and the reasonableness of accountingestimates made by management, as weIl as evaluating the overall presentation of thefinancial statements.We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinionon the financialstatements.

Hazem Hassan

I

1440082233:; 373 200 1535662392 114

543265577379252724159302114145363785212898033

19J3 117920( (93087)

192302352110787486

22R9 191961

1850939759438252202

4358 125000207464 895

(2022909 901)( 691 740235)1850939759

13410473035662392114

58131787255212963

38916051011266216

10838815I705917

4321344811

24000000I 166764 2371298984482748225 18682214541028616041

105188091127421364

31/1212012LE

4358 125000374 191790

(2656 143924)( 374655 290)17015175762323 1608754024678451869906352812723741979

632497573030039647784

10203378482252790635827837215839024399206061898683479969589300

2149931203613033072

23714672 054

590305137298250652638770:13551

2984514318181875553389063042384313065

181429664051 147347228354291330752704745204 908

31/1212013LI~

I

Banks ovcrdraftShort term loansDuc to rclated partiesTrade and other payablesCreditors and other credit balancesProvisionsLiabilitics classiflcd as held for saleTotal current liabllltlesTotalliahiliticsTotal equity and Iiabilitics

LiahilitiesLong term loansLong term liabilitiesLoans from related partiesDeferred tax liabilitles (assets)Total non-current llabülties

(25)

(24)(26)

EquityShare capitalReservesRetained lossNet loss for the yearTotal equityShareholders' credit balancesTotal equity attrlbutable to equfty holders or the CompanyNon - controlling lnterestsTotal equity

(19)(20)( 18)(21)(22)(23.1)

(17)(10)

Inventories (net)Biological assetsWork in processInvestments at fair valuc through profit or 1055

Duc from related parties (net)Trade and other receivables (net)Dcbtors and other debit balances (net)Cash and cash equivalentsAssets classified as held for saleTotal current assetsTotal assets

(6)(7)(8)(9)(10)( 18)(11)(12)( 13)(14)(15)( 16)

Assel~Fixcd assets (nct)Projccts under construction (nel)Intangible assets (nct)GoodwillBiological assetsTradc and other rcceivables (nct)Investment property (nel)Investments in associatesAvailable-for- sale investments (net)Payments for investments (nct)Loans to related partiesOthcr investments and derivativesTotal non-current assets

Note

Citadel Capital Company(Egyptian .Joint Stock Companyl

Consolldated halance sheetas at l>ccember 31.2013

(27) 6783015637(28) 147584443(27) 524651877(29) 130746891

7585998848

(30) 834349310(27) 2297627407(31 ) 274069364(32) 3263683743(33) 1959822974(34) 477164016(23.2) 623190143

9729906 9571731590580530039647 784

For the year ended

Note 31/12/2013 31/12/2012

LE LE

Advisory fee (35.1) 102451433 63097728

Share of (loss) profit of equity accounted investees (36) (71 883 172) (387850021)

Net results of other operations (37) 2064875 (25 181 929)

Total operating profit I (loss) 32633 136 ( 349 934 222)

Administrative and general expenses (38) (226798212) ( 242 120 857)

Other expenses (39) ( 136 686 298) (54682417)

Net operating loss (330851 374) ( 646 737 496)

Finance costs (net) (40) (54089035) (54519494)

Net loss before tax ( 384 940 409) ( 70 I 256 990)

Income tax 70380 ( I 101 049)

Net loss for the year ( 384 870 029) ( 702 358 039)

Attributable to:

Equity holders of the Company ( 374 655 290) ( 69I740235)

Non - controlling interests ( 10214739) ( 10 617804)

B ( 384 870 029) ( 702 358 039)

I Earnings per share (41) (0,43) (0.79)

II The accompanying notes on pages 5 to 88 are integral part of these consolidated financial statements and are to be

read therewith.S

I_?

for the year ended December 31, 2013

Consolidated income statement

(Egyptian Joint Stock Company)

Citadel Capital Company

.3-

The accompanying notes on pages 5 1088 are integral part of these consolidated financial statements and are 10be read therewith.

Note Share capltal Reserves Retaloed Nd lass for Sbarebolders' Total NoooCOotrolllog Total equity

Legal reserve Fair value r.c, Compaoy's share of lass the year credlt balaoces loterestsreserve -AFS

translatioo cbaoges 10

reserve assoclates' equity

LE LE LE LE LE LE LE LE LE LE LE

Balance as at December 31. 2011 4358125000 89578478 ( 739595) 170806715 (72 310103) (1093810353) ( 773 536 460) 2678113682 379713881 3057827563

Carrying 2011 loss forward ( 773 536 460) 773536460

Exchange differences relating to foreign operarions (3.3) 23 418122 23 418122 (2562292) 20855830

Changes in the fair value of available -for- sale investments (3.8.1) 101393 101393 101393

Acquisition of subsidiaries (91 341 737) ( 91341737) (91341737)

Changes in non-controlling interests 71 718417 71718417

Company's share in changes of associates equity (3.1.4) (3390 115) (64 221351) (67611 466) (67611 466)

Net loss for the year ended December 31. 2012 ( 691 740 235) ( 691 740 235) ( 10617 804) ( 702 358 039)

Balance as at December 3 I. 2012 4358125000 89578478 ( 638202) 194224837 (75700218) (2022909901) ( 691740 235) 1850939759 438252202 2289191961

Carrying 2012 loss forward ( 691 740 235) 691740 235

Shareholders' credit balances (25) 2323 160875 2323 160875 2323 160875

Exchange differences relating 10 foreign operarions (3.3) 165987826 165987826 ( 289 916 196) ( 123928 370)

Changes in the fair value of available -for- sale investrnents (3.8.1) 694479 694479 694479

Changes in non-controlling imerests 8560 942 261 8560 942 261

Company's share inchanges of associates equity (3.1.4) 44590 58506 212 58550802 58550 802

Net loss for the year ended December 31, 2013 (374655290) ( 374 655 290) ( 10214739) ( 384 870 029)

Balance as al December 31, 2013 4358125 000 89578478 56277 360 212 663 (75655628) (2656 143924) ( 374655 290) 2323 160875 4024678451 8699063528 12723 741 979

Cltadel Capital Compaoy

(EgYDtian JoInt Stock Companv)

Consolldated statemeot of cbaoges 10 equity

for the vear ended Dec:ember 31,2013

- -

The accompanying notcs on pages 5 to 88 arc integral part ofthcse consolidated financial statcments and are to be rcad thercwith.

255212963

699161021815364873760374

948819562

948819562

( 392 651 680)

(13471 377)12690376

(37966663)(279504790)(111925 104)

262563734900241

( 486 251 780)

(451 005 058)22 107266

(36600596)

(20753392)(2936979)

42475351

1958260770000002206792

225 118854(15295765)(48721536)

14295798433778202

3000274

( 70 I 256 990)

865217264 776 841I 884289 1452 149931203

180830095

232 121 730(8864 050)7044079

(49471 (64)

(149461332)

(9358631)572 527

(23 187904)(114 187324)

(3300000)

2350839672805726641362142480209

(335 009 662)(30503546)

(63696767)202557765141427052743580

(17445245)(2837229)

31579321377 240I737030

1820532894919283( 741 836)(584927)

358895534(9563878)

( 384 940 409)

For the year ended31112/2013 31/12/2012

LE LE

III,

Net changes in cash and cash equivalents during the yearCash and cash equivalents at the beginning ofthe year - notc (22)Cash relatcd to acquisition of subsidiaries - note (5)Cash and cash cquivalents at the end of the year

Cash Ilows from operating activitiesNet loss before taxAdjustments to reconciIe net loss to net cash used in operating activities :DepreciationCompany's share of (loss) profit of equity accounted investeesNet change in the fair value of investments at fair value through profit or lossGain on sale of investments at fair value through profit or lossForeign currencies translation differencesForcign currencies exchange differencesInterest incomeLoss on sale of fixed assetsInterest expensesProvisions formedImpairment loss on fixed assetsReversal of impairment loss on assets - (duc from related parties)Impairment loss on trade and other receivables - (due from related parties)Impairment in available for sale investmentsInventories write offProvisions reversedAmounts used from provisionOperating profit (loss) before changes in working capitalChange in investments at fair value through profit or lossChange in trade and other receivablesChange in inventories and biological assetsChange in trade and other payablesNet cash used in operating activitiesCash Ilows from investing activitiesPayments for purchase of fixed assetsProceeds from sale of fixed assetsPayments for projects under constructionPayments for other investmentsPaymcnts for purchase of investments in associatesProceeds from refund of available Ior salc investmentsDividends receivedNet cash uscd in investing activitiesCash nows from financing activitiesProceeds from loansPayments for loansProceeds from bank overdraftNon-controlling interestsNet cash provided from financing activitiesI

Citadel Capital Company(Egyptian .Joint Stock Company)

Consolidated statement of cash Ilowsfor the year ended December 31,2013

5

Basis of measurementThe consolidated financial statements have been prepared on the historicalcost basis except assets and liabilities which are measured at fair value asfollows:• Financial instruments at fair value through the profit or loss.

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2. Basis of preparation2.1 Statement of compliance

The consolidated financial statements have been prepared in accordance withthe Egyptian Accounting Standards and applicable laws and regulations.The financial statements were approved by the Board of Directors on May15,2014.

1. Reporting entityCitadeI Capital Company - an Egyptian Joint Stock Company - was founded inaccordance with the applicable Egyptian laws and in pursuance to law no.(159) of1981 and its executive regulations. The Company has been registered in thecommercial register at Giza under number 11121on April 13,2004.The address of the Cornpany's registered office is 3 EI Yemen St., Dokki - Giza.The Company's basic activity extends to the region of the middle East and northEast Africa, especially Egypt, Aigeria, Libya, Syria and Sudan. The purpose ofthe Company is represented as folIows:

Providing consultancy in financial and financing fields for different companiesand preparing and presenting the feasibility studies in the economical,technological, engineering, marketing, financing, management, borrowingcontracts arrangements fields and financing studies in addition to preparingand presenting studies and consultancy regarding projects' promotion andoffering the necessary technical support in different fields except legalconsultancy.Working as an agent in contracting and negotiation in different fields and stepsespecially negotiation in the management contracts, participation and technicalsupport.Managing, executing and restructuring of projects.

The consolidated financial statements of the Company for the year endedDecember 31, 2013 comprise the Company and its subsidiaries (together referredto as the "Group" and individually as "Group entities") and the Group's interest inassociates.

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Citadel Capital CompanyNotes to the consolidated financial statements for the year ended December 31, 2013

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3. Significant accounting policiesThe accounting policies set out below have been applied consistently to all periodspresented in these consolidated financial statements, and have been appliedconsistently by Group entities. Certain comparative amounts are reclassified toconform with the current presentation of financial statements.

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2.4 Use of estimate and judgementsThe preparation of financial statements 10 conformity with EgyptianAccounting Standards requires management to make judgments, estimatesand assumptions that affect the application of accounting policies and thereported amounts of assets, liabilities, income and expenses. The estimatesand associated assumptions are based on historical experience and variousother factors that are believed to be reasonable under the circumstances, theresults of which form the basis of making the judgments about the carryingvalues of assets and liabilities that are readily apparent from other sourees.Actual results may differ from these estimates.Estimates and underlying assumptions are reviewed on an ongoing basis.Revisions to accounting estimates are recognised in the period in which theestimates are revised and in any future periods affected.In particular, information about significant areas of estimation uncertaintyand critical judgements in applying accounting policies that have the mostsignificant effect on the amounts recognised in the financial statements isincluded in the following notes:• Note (12) measurements of the recoverable amounts of investments in

associates.• Note (34) provisions.• Note (29) deferred tax.

2.3 Functional and presentation currencyThese consolidated financial statements are presented in Egyptian Pound,which is the Company's functional currency.

• Available-for-sale financial assets.• Derivative financial instruments.The methods used to measure the fair value are discussed in note (4).

Citadel Capital CompanyNotes to the consolidated financial statements for the year ended December 31,2013

7

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3.1.2 Loss exceeding non-controllingLosses that exceed the non - controlling in the equity of a subsidiarymay create a debit balance on non - controlling only if the minorityhas a binding obligation to fund the losses and is able to contribute anadditional investment to cover the losses .If this is not the case thenthe losses are attributable to the parent's interest. If the subsidiarysubsequently reports profits, then these profits are allocated to parentuntil the share of losses absorbed previously by the parent has beenrecovered.

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3.1 Basis of consolidation

3.1.1 Subsidiaries

The consolidated financial statements include all subsidiaries that

are controlled by the parent company and which the management

intends to continue to control. Control exists when the Group has

the power to govem the financial and operating policies of an

entity so as to obtain benefits from its activities. In assessingcontrol, potential voting rights that presently are exercisable are

taken into account. The financial statements of subsidiaries are

included in the consolidated financial statements from the datethat control commences until the date that control ceases.

Intragroup balances and transactions, including income, expenses

and dividends, are eliminated in full. Profits and losses resultingfrom intragroup transactions that are recognized in assets, such as

inventory and fixed assets, are eliminated in full. Intragroup

losses may indicate an impairment that requires recognition in the

consolidated financial statements. EAS 24 Income Taxes appliesto temporary differences that arise from the elimination of profits

and losses resulting from intragroup transactions.

Non - controlling interests shall be presented in the consolidatedbalance sheet within equity, separately from the parent

shareholder's equity. Non - controlling interests in the profit orloss of the group shall also be separately disclosed.A parent loses control when it loses the power to govern thefinancial and operating policies of an investee so as to obtainbenefit from its activities.


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3.1.4 AssociatesInvestments in associates are stated at equity method. Under the equitymethod the investment in associates is initially recognized at cost andthe carrying amount is increased or decreased to recognize theinvestor's share of the profit or loss of the associates after the date ofacquisition. Distributions received from associates reduce the carryingamount of the investment.Losses of an associate in excess of the Company's interest in thatassociate (which includes any long-term interests that, in substance,form part of the Company's net investment in the associate) are notrecognized, unless the Company has incurred legal or constructiveobligations or made payments on behalf of the associate.Any excess ofthe cost ofthe acquisition over the Company's share ofthe net fair value of the identifiable assets, liabilities and contingentliabilities of the associate recognized at the date of acquisition isrecognized as goodwill. The goodwill is included within the carryingamount of the investment and is assessed for impairment as part of theinvestment.

3.1.3 Acquisitions from non-controlling interest and entities under

common control

Business combinations arising from transfers of interests from non -controlling interest or in entities that are under the control of theshareholder that controls the Group are accounted for as if theacquisition had occurred at the beginning of the earliest comparativeperiod presented or, if later, at the date that common control wasestablished; for this purpose comparatives are restated whenpractical. The assets and liabilities acquired are recognised at thecarrying amounts recognised previously in the Group's controllingshareholder's consolidated financial statements. The components ofequity of the acquired entity or attributable to the minorities areadded to the same components within the Group equity except thatany share capital of the acquired entities is recognised as notionalcapital contribution. Any cash paid for the acquisition recogniseddirectly in equity.


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3.4.2 DisposalsThe Group derecognises a financial asset when the contractual rightsto the cash flows from the asset expire, or it transfers the rights toreceive the contractual cash flows in a transaction in whichsubstantially all the risks and rewards of ownership of the financialasset are transferred. Any interest in such transferred financial assetsthat is created or retained by the Group is recognised as aseparateasset or liability.

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3.4 Recognition and disposals of the financial assets and Iiabilities3.4.1 Recognition

The Group initially recogruses deposits, receivables and debtinstruments by fair value on the date that they are originated. Allother financial assets and liabilities (including assets and liabilitiesdesignated as at fair value through profit or loss) are recognisedwhen the Group becomes a party to the contractual provisions of theinstrument.

3.3 Foreign operationsAs at the reporting date the assets and liabilities of these consolidatedsubsidiaries are translated to Egyptian Pound at the rates ruling as at thereporting date, and the shareholders' equity accounts are translated athistorical rates, where as the income statement items are translated at theaverage exchange rates ruling during the period of the consolidatedfinancial statements. Currency translation differences are recorded in theshareholders' equity section of the financial position as foreign currencytranslation reserve.I

3.2 Foreign currency transactionsThe Company maintains its accounts in Egyptian pounds. Transactionsdenominated in foreign currencies are translated at foreign exchange ratesruling at the date of transactions. Monetary assets and liabilities denominatedin foreign currencies at the reporting date are retranslated at the foreignexchange rates ruling at that date. The foreign currency exchange differencesarising on the translation at the reporting date are recognized in the incomestatement.

Citadel Capital CompanyNotes to the consolidated financial statements for thc year endedDecember31,2013

10

3.5 Derivative financiaI instrumentsThe Group uses derivative financial instruments to hedge its exposure toforeign exchange and interest rate risks. Derivatives are recognized initiallyat fair value; attributable transaction costs are recognized in profit or losswhen incurred. Subsequent to initial recognition, derivatives are measuredat fair value, and changes therein are accounted for as described below:

Changes in the fair value of the derivative hedging instrumentdesignated as a cash flow hedge are recognized directly in equity to theextent that the hedge is effective. To the extent that the hedge isineffective, changes in fair value are recognized in profit or loss.If the hedging instrument no longer meets the criteria for hedgeaccounting, expires or is sold, terminated or exercised, then hedge

IIII

•

The Group derecognises a financialliability when its contractualobligations are discharged, cancelled or expire.When an entity retains the contractual rights to receive the cashflows of a financial asset (the 'original asset'), but assurnesa contractual obligation to pay those cash flows to one or moreentities (the 'eventual recipients'), the entity treats the transaction asa transfer of a financial asset if, and only if, all of the followingthree conditions are met:(a) The entity has no obligation to pay amounts to the eventual

recipients unless it collects equivalent amounts from theoriginal asset. Short-term advances by the entity with the rightof full recovery of the amount lent plus accrued interest atmarket rates do not violate this condition.

(b) The entity is prohibited by the terms of the transfer contractfrom selling or pledging the original asset other than as securityto the eventual recipients for the obligation to pay them cashflows.

(c) The entity has an obligation to remit any cash flows it collectson behalf of the eventual recipients without material delay. Inaddition, the entity is not entitled to reinvest such cash flows,except for investments in cash or cash equivalents during theshort settlement period from the collection date to the date ofrequired remittance to the eventual recipients, and interestearned on such investments is passed to the eventual recipients.I


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3.8 Investments3.8.1 Available-for-sale financial investments

Available-for-sale investments are valued at fair value, with anyresultant gain or loss being recognized in equity, except forimpairment losses which is recognized in the income statement.When these investments are derecognized, the cumulative gain orloss previously recognized directly in equity is recognized in theincome statement. The fair value of investments available-for-saleidentifies, based on quoted price of the exchange market at thebalance sheet date, investments that are not quoted, and whose fairvalue cannot be measured reliably are valued by an acceptedvaluation techniques including the use of new objective techniquesor discounted cash flow analysis or option pricing models or other

B

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3.7 Cash and cash equivalents

For the purpose of preparing cash flow statement, cash and cash equivalents

are represented in balances with original maturities of three months or less.

3.6 Lending

Loans are stated at cost less any impairment losses in its value and theCompany revaluates the loans at each financial position date, in case of

impairment in the redeemable value of the loan less than its book value the

loan is impaired by the value of impairment loss and recognized in income

statement.

accounting is discontinued prospectively. The cumulative gain or loss

previously recognized in equity remains there until the forecast

transaction occurs. When the hedged item is a non- financial asset, the

amount recognized in equity is transferred to the carrying amount of the

asset when it is recognized. In other cases the amount recognized in

equity is transferred to profit or loss in the same period that the hedgeditem affects profit or loss.

Changes in the fair value of a derivative hedging instrument designated

as a fair value hedge are recognized in profit or loss. The hedged itemalso is stated at fair value in respect of the risk being hedged, with any

gain or loss being recognized in profit or loss with an adjustment to the

carrying amount of the hedged item .

Citadel Capital CompanyNotes to tbe consolidated financial statements for tbe year ended December 31,2013

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Estimated usefullife5-50 years -contract period3-10 years4-14 years4 -16 years2-4 years4 -5 years5-20 years50 years

Assets depreciation- Buildings & Constructions- Lease hold improvements- Machinery & Equipments& tools- Furniture & Fixtures- Computers- Transportation means- Barges- Quarries

IIII

3.10Fixed assets depreciationFixed assets are stated at historical cost and presented in the balance sheetnet of accumulated depreciation and impairment (note 3.18), and aredepreciated using the straight line method and recognized in incomestatement over the estimated productive life for each type of asset. Thefollowing are the estimated productive lives, for each class of assets, fordepreciation calculation purposes:

3.9 Share capitalOrdinary shares are classified as equity. Incremental costs directlyattributable to the issue of ordinary shares and share options are recognisedas a deduction from equity, net of any tax effects.

3.8.3 OtherOther non-derivative financial instruments are measured atamortised cost using the effective interest method, less anyimpairment losses.

3.8.2 Financial assets at fair value through profit or lossAn instrument is classified at fair value through profit or loss if it isheld for tradingor is designatedas such upon initial recognition.Upon initial recognitionattributabletransaction costs are recognised inprofit or losswhen incurred.Financial instrumentsat fair value throughprofit or loss are measured at fair value, and changes therein arerecognisedin profit or loss.

valuation techniques - if the company cannot estimate the fair value,it can be stated at cost less impairment loss.

Citadel Capital CompanyNotesto the consolidatedfinancialstatements for the year ended December31,2013

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I 3.14 Investment property3.14.1 Recognition and initial measurement

Investment property is property held either to earn rental incomeor for capital appreciation or for both, but not for sale in theordinary course of business, use in the production or supply ofgoods or services or for administrative purposes. Investmentproperty is measured using the cost model on initial recognitionand subsequently assessed for impairment with any change thereinrecognized in profit or loss.Cost includes expenditure that is directly attributable to theacquisition of the investment property. The cost of self-

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3.13Work in processWork in process represents the cost of work not invoiced to the customerfor contract work performed to date.Cost includes all expenditure related directly to specific projects and anallocation of fixed and variable overheads incurred in the Group' s contractactivities based on normal operating capacity.

3.12 Projects und er constructionProjects under construction are recognized initially at cost. Cost includesall expenditures directly attributable to bringing the asset to a workingcondition for its intended use. Property and equipment under constructionare transferred to property and equipment caption when they are completedand are ready for their intended use.

•

3.11 Gains and losses from disposal of fixed assets

Gains and losses from disposal of fixed assets are determined bycomparing net disposal proceeds of assets to its net book value, resulted

gain and losses are recorded in the income statement.

Expenditure incurred to replace a component of an item of property and

equipment that is accounted for separately, including major inspection and

overhaul expenditure, is capitalized. Other subsequent expenditure is

capitalized only when it increases the future economic benefits embodiedin the property and equipment. All other expenditure is recognized in the

income statement as an expense as incurred.


14

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3.15 Assets held for saleAssets (or disposal groups comprising assets and liabilities) that areexpected to be recovered primarily through sale rather than throughcontinuing use is classified as held for sale. Immediately beforeclassification as held for sale, the assets (or components of a disposalgroup) are remeasured in accordance with the Group's accountingpolicies. Thereafter generally the assets (or disposal group) are measuredat the lower of their carrying amount and fair value less cost to sell. Anyimpairment loss on a disposal group first is allocated to goodwill, andthen to remaining assets and liabilities on pro rata basis, except that noloss is allocated to inventories, financial assets, deferred tax assets,employee benefit assets, investment property and biological assets,which continue to be measured in accordance with the Group' saccounting policies. Impairment losses on initial classification as held forsale and subsequent gains or losses on re-measurement are recognized inprofit or loss. Gains are not recognized in excess of any cumulativeimpairment loss.

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3.14.2 Cost incurred after initial recognitionReplacement cost of one of the asset component is recognized inthe investment property cost after excluding the cost of thereplaced assets.The replacements give rise to future economic benefits that canbe reliably measured. Other expenditure that not qualify forrecognition should be charged to profit or loss as incurred.

constructed investment property includes the cost of materials anddirect labor, any other costs directly attributable to bringing theinvestment property to a working condition for their intended useand capitalized borrowing costs.When the use of investment property changes such that it isreclassified to property, plant and equipment, its fair value at thedate of reclassification becomes its cost for subsequentaccounting, thus if the company applies fair value method. In casethat the company applies cost model, the investment property isreclassified to property, plant and equipment by its carrying valuewithout changing the cost ofproperty.


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3.17.2 Other intangible assetsOther intangible assets that are acquired by the Group, whichhave finite useful lives, are measured at cost less accumulatedamortisation and accumulated impairment losses.

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3.17 Intangible assets3.17.1 Goodwill

Goodwill (negative goodwill) arises on the acquisition ofsubsidiaries, associates and joint ventures. Goodwill representsthe excess ofthe cost ofthe acquisition over the Group's interestin the net fair value of the identifiable assets, liabilities andcontingent liabilities of the acquired entity. When the excess isnegative (negative goodwill), it is recognised immediately inprofit or loss.Goodwill is measured at cost less accumulated impairment losses.In respect of associates, the carrying amount of goodwill IS

included in the carrying amount of the investment.

3.16 Discontinued operationsDiscontinued operations represents a separate major line of business orgeographical area of operations, part of a single co-ordinated plan todispose of a separate major lines of business or geographical area ofoperations or is a subsidiary acquired exclusively with a view to re-sale.Classifications as a discontinued operations occurs at the earlier ofdisposal or when the operations meets the criteria to be classified as heldfor-sale.When an operation is classified as a discontinued operation, thecomparative statements of profit or loss and cash flows are represented asif the operation had been discontinued from the start of the comparativeyear.

Once classified as held for sale, intangible assets and property, plant andequipment are no longer amortized or depreciated, and any equityaccounted investee is no longer equity accounted.

Citadel Capital CornpanyNotes to the consolidated financial statements for the year ended December 31,2013

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3.18 Impairment3.18.1 Financial assets

A financial asset is assessed at each reporting date to determinewhether there is any objective evidence that it is impaired. Afinancial asset is considered to be impaired if objective evidenceindicates that one or more events have had a negative effect on theestimated future cash flows of that asset.An impairment loss in respect of a financial asset measured atamortised cost is calculated as the difference between its carryingamount, and the present value of the estimated future cash flowsdiscounted at the original effective interest rate. An impairmentloss in respect of an available-for-sale financial asset is calculatedby referenceto its fair value.Individually significant financial assets are tested for impairmenton an individualbasis. The remaining financial assets are assessedcollectively ingroups that share similar credit risk characteristics.All impairment losses are recognised in profit or loss. Anycumulative loss in respect of an available-for-sale fmancial assetrecognisedpreviously in equity is transferred to profit or loss.An impairment loss is reversed if the reversal can be relatedobjectively to an event occurring after the impairment loss wasrecognised. For financial assets measured at amortised cost andavailable-for-sale financial assets that are debt securities, the

I

3.17.4 Amortization

Amortisation is recognised in profit or loss on a straight-line basis

over the estimated useful lives of intangible assets, other thangoodwill, from the date that they are available for use. The

estimated useful lives for intangible assets range between 3:20

years.

3.17.3 Subsequent expenditures

Subsequent expenditure is capitalised only when it increases the

future economic benefits embodied in the specific asset to which

it relates. All other expenditure, including expenditure on

intemally generated goodwill, is recognised in profit or loss asincurred.


17

3.18.2 Non-financial assetsThe carrying amounts of the Group's non-financial assets otherthan inventories and deferred tax assets, are reviewed at eachreporting date to determine whether there is any indication ofimpairment. If any such indication exists, then the asset' srecoverable amount is estimated. For goodwill and intangibleassets that have indefinite lives or that are not yet available for use,the recoverable amount is estimated at each reporting date.The recoverable amount of an asset or cash-generating unit is thegreater of its value in use and its fair value less costs to seil. Inassessing value in use, the estimated future cash flows arediscounted to their present value using apre-tax discount rate thatreflects currentmarket assessments of the time value of money andthe risks specific to the asset. For the purpose of impairmenttesting, assets are grouped together into the smallest group ofassets that generates cash inflows from continuing use that arelargely independent of the cash inflows of other assets or groups ofassets (the "cash-generating unit"). The goodwill acquired in abusiness combination, for the purpose of impairment testing, isaIlocatedto cash-generatingunits that are expected to benefit fromthe synergies of the combination.An impairment loss is recognised if the carrying amount of anasset or its cash-generating unit exceeds its estimated recoverableamount. Impairment losses are recognised in profit or loss.Impairment losses recognised in respect of cash-generating unitsare aIlocated first to reduce the carrying amount of any goodwillaIlocatedto the units and then to reduce the carrying amount of theother assets in the unit (group ofunits) on a pro rata basis.An impairment loss in respect of goodwill is not reversed. Inrespect of other assets, impairrnent losses recognised in prior yearsare assessed at each reporting date for any indications that the losshas decreased or no longer exists.An impairment loss is reversed ifthere has been a change in the estimates used to determine the

II

reversal is recognised in profit or loss. For available-for-salefinancial assets that are equity securities, the reversal is recogniseddirectIyin equity.


18

3.21 InventoriesInventories are measured at the lower of cost and net realizable value. Thecost of inventories is based on the moving average principle and includesexpenditure incurred in acquiring the inventories and bringing it to theirexisting location and condition. In the case of manufactured inventoriesand work in progress, cost includes an appropriate share of overheadsbased on the normal operating capacity.

II

fair value less cost to seIl3- 50 years56 months

Corn, cotton and sunflowersFruit gardensCattle

3.20 Biological assetsBiological assets and agricultural products are measured at fair value lessestimated costs to sell, with any change therein recognised in profit orloss. the following is the measurement of the biological assets:

3.19 Trade and other receivables

Non-interest bearing short-term trade and other receivables are stated at

cost less impairment losses. An impairment of trade and other receivables

is established when there is objective evidence that the Group will not beable to collect all amounts due according to the original terms of the

receivables. Significant financial difficulties of the debtor, probability thatthe debtor will enter bankruptcy and default or delinquency in payments

are considered indicators that the trade receivable is impaired. Theamount of the impairment is the difference between the asset' s carrying

amount and the present value of estimated future cash flows, discounted at

the original effective interest rate. The carrying amount of the asset isreduced through the use of an allowance account, and the amount of the

loss relating to trade receivables is recognised in the income statement.When a trade receivable is uncollectible, it is written off against the

allowance account for trade receivables. Subsequent recoveries ofamounts previously written off are credited in the income statement.

recoverable amount. An impairment loss is reversed only to the

extent that the asset' s carrying amount does not exceed the

carrying amount that would have been determined, net of

depreciation or amortisation, if no impairment loss had beenrecognised.


19

3.27 Income taxIncome tax on the profit or loss for the period comprises current anddeferred tax. Income tax is recognized in the income statement exceptto the extent that it relates to items recognized directly in equity, inwhich case it is recognized in equity.

D

I

3.26 DividendsDividends are recognised as a liability in the period in which they aredeclared.

3.25 Legal reserveThe company's Statutes provides for deduction of a sum equal to 5% ofthe annual net profit for formation of the legal reserve. Such deductionwill be ceased when the total reserve reaches an amount equal to half ofthe cornpany's issued capital and when the reserve falls below this limit, itshall be necessary to resume the deduction.

3.24 Interest bearing borrowingsInterest-bearing borrowings are recognised initially at fair value lessattributable transaction costs. Subsequent to initial recognition, Interestbearing borrowings are stated at amortised cost with any differencebetween cost and redemption value being recognised in the incomestatement over the year of the borrowings on an effective interest ratebasis.

3.23 Provisions

Provisions are recognised when the Group has a legal or constructive

obligation as a result of a past event and it is probable that a flow of

economic benefits will be required to settle the obligation. If the effect ismaterial, provisions are determined by discounting the expected futurecash flows at a pre-tax rate that reflects current market assessment of thetime value of money and where appropriate, the risks specific to theliability. Provisions are reviewed at the reporting date and amended (whennecessary) to represent the best current estimate.

3.22 Trade and other payables

Short-term trade and other payables are stated at cost.


20

3.29 Employees benefits3.29.1 Pensions

The Group contributes to the govemment social insurance systemfor the benefit of its personnel in accordance with the socialinsurance law. Under this law employees and employers contributeto the system a fixed percentage of the employees' salaries basis.The Group's liability is confined to such contributions amount.Contributionsare charged to the income statementusing the accrualbasis of accounting.

III

3.28 Earnings per shareThe Group presents basic and diluted earnings per share (EPS) data for itsordinary shares. Basic EPS is calculated by dividing the profit or lossattributable to ordinary shareholders of the Company by the weightedaverage number of ordinary shares outstanding during the period. DilutedEPS is determined by adjusting the profit or loss attributable to ordinaryshareholders and the weighted average number of ordinary sharesoutstanding for the effects of all dilutive potential ordinary shares, whichcomprise convertible notes and share options granted to employees.

Current tax is the expected tax payable on the taxable income for theyear, using tax rates enacted or substantially enacted at the balancesheet date, and any adjustment to tax payable in respect of previousyears.Deferred tax is provided using the balance sheet liability method,providing for temporary differences between the carrying amounts ofassets and liabilities for financial reporting purposes and the amountsused for taxation purposes. The amount of deferred tax provided isbased on the expected manner of realization or settlement of thecarrying amount of assets and liabilities, using tax rates enacted orsubstantiaUyenacted at the balance sheet date.A deferred tax asset is recognized only to the extent that it is probablethat future taxable profits will be available against which the asset canbe utilized. Deferred tax assets are reduced to the extent that it is nolonger probable that the related tax benefitwill be realized.


3.30.3 CommissionsWhen the Group acts in the capacity of an agent rather than as theprincipal in a transaction, the revenue recognised is the netamount of commission made by the Group.

21

3.30.2 ServicesRevenue from services rendered is recognised in profit or loss inproportion to the stage of completion of the transaction at thereporting date. The stage of completion is assessed by referenceto surveys of work performed.

I~

3.30.1 Gain (Ioss) on sale of investments

Gain (loss) resulted from sale of investments are recognized on

trans action date and measured by the difference between cost andselling price less selling commission and expenses.

3.30 Revenue

Revenues comprise the fair value of the consideration received or receivable

for services in the ordinary course of the Company's activities. Revenue isshown net of sales tax, rebates, and discounts.

The Company recognises revenues when the amount of revenue can bereliably measured, it is probable that future economic benefits will flow to

the entity and when specific criteria have been met for each of the

Company's activities as described below. The Company bases its estimates

on historical results, taking into consideration the type of customer, the typeof transaction, and the specifics of each arrangement.

3.29.2 Other short-term benefits

Short-term employee benefit obligations are measured on an

undiscounted basis and are expensed as the related service isprovided

A liability is recognised for the amount expected to be paid under

short-term cash bonus or profit-sharing plans if the Group has a

present legal or constructive obligation to pay this amount as a result

of past service provided by the employee and the obligation can beestimated reliably.

Citadel Capital CompanyNotes to thc consolidated financial statements for the year ended Decembcr 31,2013

22

3.30.9 Construction contractsContract revenue includes the initial amount agreed in the contractplus any variations in contract work, claims and incentivepayments to the extent that it is probable that they will result inrevenue and can be measured reliably.As soon as the outcome of a construction contract can be estimatedreliably, contract revenue and expenses are recognized in profit orloss in proportion to the stage of completion of the contract. Thestage of completion is assessed by survey of work performed.When the outcome of a construction contract cannot be estimatedreliably, contract revenue is recognized only to the extent ofcontract costs incurred that are likely to be recoverable. Anexpected loss on a contract is recognized immediately in profit orloss.

III

3.30.8 Sale of goodsRevenue from the sale of goods is measured at the fair value of theconsiderationreceived or receivable, net of returns, trade discountsand volume rebates. Revenue is recognised when the significantrisks and rewards of ownership have been transferred to the buyer,and the amount of revenue can be measured reliably.

3.30.7 Advisory feeAdvisory fee IS calculated based on agreed percentage inaccordance with contract term with companies upon renderingthe service.

3.30.6 Management feeManagementfee is recognized upon rendering the service.

3.30.5 Interest incomeInterest income is recognized on time proportion basis to take intoaccount effectiveyield on the asset.

3.30.4 Dividend incomeDividend income is recognised in profit or loss on the date that theGroup's right to receive payment is established, dividend income isreported in other income caption in the income statement.

Citadel Capital CompanyNotes to the consolidatedfinancialstatements for the year ended December31,2013

23

3.33 Employees' compulsory government social insurance shareThe Company contributes to the government social insurance share for the

benefit of its personnel in accordance with the social insurance law. Under

this law, the employees and the employers contribute into the system on a

fixed percentage-of-salaries basis. The company's liability is confined to the

3.32 FinancialleaseFinancial lease are classified as operating leases. Payment made under

operating leases are recognized (after any deductions) in the profit or loss on

a straight-line basis over the term ofthe lease. Maintenance cost included inthe lease cost under the financing lease is recognized in the profit or loss as

an expense for the year of occurrence.III

3.31 Borrowing costsBorrowing costs are recognized as expenses in the profit or loss whenincurred, with the exception of borrowing cost directly attributable to the

construction and acquisition of new assets which is capitalized as part of therelevant assets cost and depreciated over assets' estimated usefullives. This

capitalization ceases once the assets become in operational condition andready for use.

3.30.13 Natural gas revenuesRevenues is recognized when supplying cars with natural gas

service is rendered.

3.30.12 Fuelling revenuesRevenues is recognized when supplying ships with fuel.

3.30.11 Gas sales revenuesFor actual gas sales, the company remits the funds it collects to

EGPC net of its actual commission, which is calculated as a

percentage of gas consumption.

3.30.10 Cars conversion revenues

Revenue is recognized upon the completion of preparing cars to

function using natural gas instead of Benzene upon issuing theinvoice to the client.


24

4.3 Trade and other receivablesThe fair value of trade and other receivables, excluding construction workin progress, is estimated as the present value of future cash flows,discounted at the market rate of interest at the reporting date.

III

Investment in equity and debt securitiesThe fair value of financial assets at fair value through profit or loss, heldto-maturity investments and available-for-sale financial assets isdetermined by reference to their quoted bid price at the reporting date. Thefair value of held-to-maturity investments is determined for disclosurepurposes only.

4.2

4. Determination of fair valuesA number of the Group's accounting policies and disclosures require thedetermination of fair value, for both financial and non-financial assets andliabilities. Fair values have been determined for measurement and / or disclosurepurposes based on the following methods. When applicable, further informationabout the assumptions made in determining fair values is disclosed in the notesspecific to that asset or liability.4.1 Intangible assets

Intangible assets are stated at historical cost and amortised over aperiodfrom 3 to 20 years.Other intangible assets that have finite useful lives are measured at costless accumulated impairment loss.

3.34 Segment reportingA segment is a distinguishablecomponentof the Groupthat is engagedeitherin providingproductsor services(business segment)or in providingproductsor services within a particular economic environment (geographicalsegment), which is subjected to risks and rewards that are different fromthose of other segments.The Group's primary format for segment reportingis based on businesssegment.

amount of its contribution.Contributions are charged to income statementusing the accrualbasisof accounting.

Citadel Capital CompanyNotes to the consolidated financialstatements for the year endedDecember31,2013

25

I

4.5 InventoriesThe fair value of inventories acquired in a business combination isdetermined based on its estimated selling price in the ordinary course ofbusiness less the estimated costs of completion and sale, and a reasonableprofit margin based on the effort required to complete and seIl theinventories.

4.4 Non-derivatives financialliabilitiesFair value, which is determined for disclosure purposes, is calculated basedon the present value of future principal and interest cash flows, discountedat the market rate of interest at the reporting date.


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II

31

7. Projects under constructionProjects under construction balance represented in the following:

31/12/2013 31/12/2012LE LE

Balance at the beginning of the year '" 127421 364 20889151Acquisition of subsidiaries ** 9795264529 68565550Additions during the year 23 187904 37966663Transferred to fixed assets (48 168308)Foreign currency translation differences 10756234

Balance 9908461 723 127421 364

Impairment ** (83396460)

Net 9825065263 127421 364

'" Reclassified from fixed assets note (6).

"'* Note (5).

8. Intangible assets (net)Note 31/12/2013 31/12/2012no. LE LE

Software * (8-1) 24348 107

I Concession * (8-2) 473545952

I Other intangible assets * (8-3) 379139492Net 877033551

I * Note (5).

**

Depreciation for the year is included in administrative and general expensesunder other expenses-note (38).Note (5).

The land item with a balance of LE 24 million as at December 31, 2012has been reclassified from fixed assets to investment property as theCompany holds it for unspecified future purpose -note (11).Projects under construction item with a balance of LE 127 421 364 as atDecember 31, 2012 has been reclassified to aseparate item -note (7).

*


32

8-1 Software31/12/2013 31/12/2012

LE LECost at the end of the year 52395079Accumulated amortization at the end of the year (28046972)Net 24348 107

8-2 Concession31/12/2013 31/12/2012

LE LECost at the end of the year 530663790Accumulated amortization at the end of the year (57 117838)Net 473545952

8-3 Intangible assets related to acquisition of investments31/12/2013 31/12/2012

LE LELicense fees for constructing cement plant - Minya 200650015

Waiving ofthe license to establish a black cementfactory for ASEC Syria according to contractualagreement. 4992302Compensation paid for project workers 1 120875Cost of quarries exploration rights 198310297Total 405073489Accumulated amortization (25933997)Net 379 139492

I 9. Goodwill31/12/2013 31/12/2012

LE LENational Development and Trading Group * 589222726

I Orient Investment Properties Ltd. Group * 24720078

Citadel Capital Transportation Opportunities Ltd.-179739380

Group *Ledmore Holdings Ltd. * 57494554


33

II

I

31/12/2013 31/12/2012LE LE

Falcon for Agriculture Investments Ltd.-BVI Group * 865059547Mena Horne FurnishingsMalls Ltd. - BVI Group * 112299481KU Railways Holdings Limited Group * 609262405Silverstone Capital Investment Ltd. Group * 418025 123United Foundries Group * 128691 024Balance 2984514318

* Note (5).

10. Biological assets

31/12/2013 31112/2012

LE LENon-current assets

Fruitful fruit gardens and orchards * 6468004

Fruitless fruit gardens and orchards * 3970554

Pregnant heifer, dry and dairy cows * 104890501

Heifers * 66546494

181 875553

Current assets

Plants (cotton, com ,sun flower) 1076928 1705917

Others * 21450978

22527906 1705917

Balance 204403459 1 705917

* Note (5).


34

* Reclassified from fixed assets note (6).

** Note (5).

12. Investments in associates

12.1 The Group investments in associates are represented in:Percentage Carrying amount

2013 2012 31/12/2013 31/12/2012% % LE LE

EI Kateb for Marketing & Distribution Co. 48.88 48.88 2280629 434785Pharos Holding Co. * 53.00 53.00 89572029 91 140296Elsharq Book Stores Co. 40.00 40.00 14474418 15313 441ASEC Company for Mining (ASCOM) 39.22 39.22 101 391 608 118062774Silverstone Capital Investments Ltd. *** 41.81 251 361 875Dar El-Sherouk Ltd. * 58.51 58.51 139202752 140384623Crondall Holdings Ltd.**** 47.67 131740449National Development and Trading Company *** 49.81United Foundries Company *** 29.95

I Mena Horne Fumishings Mall *** 32.13 87841 662

I Citadel Capital Transportation Opportunities Ltd. *** 34.16 142551 181Tawazon for Solid Waste Management (Tawazon) 25.48 25.48 20044615 24852493

I Mena Glass Ltd. 42.49 21.03 632078427 133852 139Tanmeyah Company S.A.E ** 51.00 51.00 5722364 7663 147Ledmore Holdings Ltd. *** 35.00 21 565372Grandview Investment Holding 34.88 247624370

247130432

247130432

Buildings Others Total

LE LE LE

24000000

135813531 39 107733 398051 696

135813 531 39 107733 422051696

25883417 11 855214 37738631

25883417 11855214 37738631109930 114 27252519 384313 065

Land

LE

24000000

223 130432

Cost as at 1/1/2013 *

Acquisition of subsidiary **

Cost as at 31112/2013

Accumulated depreciation

Acquisition of subsidiaries **

Accumulated depreciation asat 31/12/2013

Net cost as at 31112/2013

11. Investment property


3S

I

The company has been consolidated as at December 31, 2013 as a result of theincrease in the capital share in this company in which increases the ownershippercentage from 47% to 80%.

****•Note (5).***

The Company does not consolidate this company as there is a call option contractthat granted third party the option to purehase 4% of its shares granted by FinancialUnlimited Company for Financial Consulting (one of subsidiaries 99.88%) that canbe exercised any time with fair value at the exercise date which cause a reductionin voting power ofthe Company from 51% to 47%.

**

The Company does not consolidate these companies as the control does not existas the Company has no power to govem the financial and operational policies ofthese companies according to the shareholders' agreements.

*

1 166764237

LELE29022

3268788558607618

1 814296640

50.0045.0027.55

Green Point for Import and Trade S.A.E. *Ostool for Land Transportation S.A.E.

Misr Cement QenaBalance

Carrying amount

31112/2013 31112/2012Percentage

2013 2012


N M 00 -<::t \0 0 \0 0\ -<::trIl tI) ...... 0 00 -<::t N tI) ...... 0~ 0\ 0 0\ r-- M ...... N 0 tI)rIl1:1 ~ -<::t r- N -<::t tI) -<::t 0\ \0 \0~ r-- r-- r-- 0 r-, N 00 M 00c:l. ~ 0\ 00 \0 N r-, N M -<::t tI)

~ N 0\ -<::t \0 M N 0\ 0 ......~ -<::t N -<::t tI) ...... ...... ...... \0

\0 r-- ...... -<::t

N 00 M tI) 0 0 -<::t \0rIl \0 M ...... r-- 0\ N 0\ M~ M tI) 0 tI) r-- 00 ...... 0::I 0 0 ...... tI) 0 \0 tI) M1:1 ~ 00 N r-- r-, \0 tI) N M~ ~ -<::t r-- -<::t 00 \0 N -:t" \0~ \0 N r-- N M ...... 0 \0~ -:t" N 0\ tI) 00 0 N \0

tI) 0\ ...... -<::t

M N ...... r-- M tI) 0\ \0 NrIl r-- 0 ...... \0 0\ r-- N r-- tI)- ~ N M tI) r-- 0\ 0\ \0 0\ \0....~ ..... ~ -<::t e- N tI) \0 -:t" r-- 0 tI)..... ....- ...... 0\ 00 M -:t" ...... 0\ 0\ ......Q .... ~E-4 .c 0 N tI) tI) 0\ M N M 00~ -<::t N -<::t 0\ N tI) r-- tI) -<::t.... \0 ...... 00 tI) 0\ 0 \0- ...... 00 M r--

..... 0 ...... 0\ 00 r-- 0\ r--1:1 rIl 0 0\ -<::t -:t" N r-- \0~ 0 00 -<::t 0 M -<::t tI)a.. ~.... 0\ tI) r-- \0 \0a.. ..... ~ M ......::I .... M \0 0 N -:t" ...... ......-CJ .... ~ M M ...... 0 -<::t -<::t r--I .c 0 M -<::t 0 00 M1:1 ~Q .... 0 ...... \0 ......- ...... ...... \0Z

M N 0 00 tI) 00 0 0\ NrIl r-- 0 N ...... -<::t -:t" tI) 0 tI)..... N M \0 M 0\ \0 ...... -<::t \01:1 ~.- -<::t 00 \0 N 0\ 00 \0 -<::t tI)~ ..... ~a.. ... ...... tI) ...... M ...... \0 00 r-- ......-a.. .... ~ 0 0\ N -<::t 0\ 00 00 \0 00

::I .c -<::t ...... -<::t \0 00 -:t" 00 ...... -:t"U ~... \0 0 r-- 0\ 00 0\ \0- r-- N

\0 0\ 0 N ...... 0\ 00 r-- NrIl \0 0 -<::t -<::t N N 0\ r- 00

rr) ..... \0 r-- 0\ 00 0 tI) r-, 0\ 0\~..... rIl 00 0\ 0\ -<::t r-- tI) 00 0 -<::tQ rIlN ~ ~ -:t" 0\ 00 \0 M 00 N N tI)

'" - ~ \0 00 0 r-- M 0 tI) 00 tI)..... ~ N e- tI) M 00 0\ r-- -<::t ......rr) ..... ...... 0\ ...... 00 -<::t 00 ...... \0 \0- Q N 0 N 0\ N tI)~ E-4 ...... ...... \0,.Qe ("')

~ ..... 0 ...... M N tI) ...... M tI) r--~ rIl 1:1 0 ...... r-- 0 0\ M 0\ ...... r--~ ~ ~ 0 -:t" -:t" 0\ -<::t M tI) 0\ N~ ~ a.. rIl r-- 0 ...... tI) N N 0\ N r--"CI .... a.. ..... ~ r-- N \0 -<::t tI) 0 tI) N NCJ ::I ~~ Q CJ rIl ~ r-- M ...... M ...... N N \0 0"CI rIl I rIl 00 -:t" tI) \0 0\ N ...... N r--= rIl 1:1 ~ 00 -<::t ...... M N M ......~ ~ Q ...... 00 ...... tI) ...... M"" ~ Z~ Q ......~..... rIl \0 00 r-- 0 \0 00 tI) N tI).....~ 1:1 \0 0\ \0 -<::t N 0\ 0 \0 0-= ~ ..... \0 N -:t" 0\ tI) ...... N 0 r--..... EI 1:1 rIl- ~ ..... ~

...... 0\ 00 00 -<::t M 0\ 00 r--eS ~ a.. ~ r-- r-- N ...... 00 00 \0 0\ N..... a.. rIl ~ 00 tI) 0\ -<::t ...... 00 N ...... tI)rIl ~ ::I rIl..... ~ M M 0\ r-- 0\ \0 \0 N -<::t..... rIl U= ...... M N tI) 0\ M -<::t~ - ...... N ...... -<::t Ne ~....~ CJ

1:1~ ~.....rIl 1:1'; l;: ,-....e::·ü ..... 0

= 1:1 ~D tOS ~

= CJ~l;: CO ~»= .... e::="0 1:1 d?J .- *f--4

~I ~ ~ bJ) ci s:: ..._,.-c:l.~.... on ~ >-.rIl U CIS r/)

EI:s ~ .s ~ §Q Ö Vl r-. -ci §Q- ci ~ tE s-u ~ ~

f'j

~..... CIS "'lj ,-....~ u B to-.:l s:: .- s- \0- = = § (\) ...... 0 -citOS Q ~ 0 gp r/) ~ 0' 0 M.... ~ EI !::! ~ u r/) u ..... ..._,.- ...!:o:: to-.:l 0

Q,,~ N .- E" e ~ "EEI r-. d "'lj 0 ~ U 0tOS -= ~ c.S VltE ...... 0 (\) (\) gj s::u .... ::I ........ 0 0 ,-....

~~ .- j:Q 0 ~ ...s:: S S (\)- Q 00. !"'l ,!:l 15 ::r: u r/) e:: ...... ......... (\) (\) Ö >-.~ (\) C" 0 I 0 0"0 rIl ~ ,!:l Vl ~ U ...... U N on

~ZtOS ~ N .- 0 U ~ CIS CIS CIS.... .... I ~ !;j ~ ..d ~ ~

~ § d.- Q N r/) ~ VlVl Vl r/) .- (\)UZ ..... ...... .- ...s:: ...... < ~ ::E ::E~ Cl po. ~ < ..._, Cl f--4 f--4

37

* Accumulated impairment in available-for-sale investments of the Company isrepresented in:

Balance as Formed Acquisition of Foreign currency Balance as

at 1/1/2013 during the subsidiaries translation at 31/12/2013

I year *** differences

LE LE LE LE LEI Logria Holding Ltd. 408850000 42250000 451 100000

I Golden Crescent

Investment Ltd. 385597933 14142705 40029812 439770450

MEFEKCo. 872 388 872 388

Balance 794447933 14 142705 872 388 82279812 891 742838

** Note (5).

*** Note (39).

13. Available-for-sale investments31112/2013 3111212012

LE LEOrient Investment Properties Ud. ** 802452210Logria Holding Ltd. * 451 100000 408850000Golden Crescent Investment Ud. * 439770450 398581 575Falcon Agriculture Investments Ud. 293960861EFG Capital Partners Fund U& UI 23705289 23705289Sphinx Turnaround 24965 116 18823033Modern Company for Isolating Materials 43396 43396Arab Swiss Engineering Company (ASEC) 34958Medcom National Company 1 000 1000Underscore International Holdings 694 629Valencia Regional Investment Ltd. 694 629TAQA Arabia ** 146978713Arab Refinery Company ** 122MEFEKCo. * 872388ASEC Automation Co.- Free Zone 116300Med Grid 1 614541Ecligo Design Ltd. 1 152Sharming Sharm 699 165Total 942890185 2093432415Accumulated impairment * (891 742 838) (794447 933)Net 51 147347 1298984482


39

16-1 Restricted cash as at December 31, 2013 includes an amount of LE561 043 660 (equivalent to US.$ 80 842026) which represents the amountdeposited at the bank under capital increase of Orient InvestmentProperties Ltd. - one of the subsidiaries- (note 5).against an amount ofUS.$ 4 549 450 as at December 31, 2012 (equivalent to LE 28 616 041)represent a restricted cash at Citibank - London for Ambience venturesLtd. (one of the subsidiaries - 75%) to guarantee the seriousness ofpayment of its due portion in KU Railways Holding Limited future capitalincrease. During the period ended March 31, 2013, the amount wastransferred to payments for investments in KU Railways Holding Limited.

16-2 Egyptian Refining Company (one ofthe subsidiaries) has entered into fiveinterest rate swap transactions with the following parties;• Societe General Corporate & Investment Banking.• HSBC Bank Middle East Limited.• KFW IPEX-BankGMBH.• Mitsubishi UFJ Securities International PLC.• Standard Chartered Bank.The main terms of the transactions are as follows;Trade date: June 25, 2012.Effective date: July 3,2012.Termination date: December 20, 2024.Fixed portion rate paid by the company is 2.3475%.Floating rate paid by bank is USO - LIBOR - BBA 6 months.Payment date :Semi - annually on 20 the commencing December 20,2012.Maximum notional amount covered under these transactions are;• US.$ 789 445 078 by Standard Chartered Bank.• US.$ 450 970 501 by Societe General Corporate & Investment

Banking.• US.$ 435 971 044 by HSBC Bank Middle East Limited.I

I

28616041

31/12/2012LE

28616041

16. Other investments and derivativesNote 31/12/2013no. LE

Restricted cash 16-1 572 133Derivatives swap contracts 16-2 163968Others 16-3 9 103 565

Balance 745204908

Citadel Capital CompanyNotes to the consolidated financial statements for the ycar ended December 31,2013

40

seriousness of constructing ASEC Syria Cement Capital Factory and willbe refunded at the beginning of production process.

17. Inventories (net)31112/2013 31112/2012

LE LESpare parts 487438707 1296690Raw materials 218959278Work in process 112525320Finished goods 63963 129Goods in-transit 68619418Packing materials 39171 838Oil and lubricants 39484860Others 29 118988 9542 125Total 1 059281 538 10838815Inventories write-down (38943690)Net 1 020337848 10838815

18. Trade and other receivables (net)31112/2013 31112/2012

LE LENon-current assets

Accounts receivables 48861 910

Egyptian General Petroleum Corp. * 342858555

Others 2474832Total 394195297Accumulated impairment (5 132255)Net 389063042Current assetsAccounts receivables 966003 137Notes receivables 38098 186Total 1 004 101 323Accumulated impairment (105417844}Net 898683479Balance 1 287746521

16-3 Other investments includes an amount ofLE 7 904 058 (equivalent to US.$1 million) represents a deposits at Syria Central Bank as a guarantee for the

• US.$ 107 759 253 by KFW IPEX - Bank GMBH.• US.$ 189466819 by Mitsubishi UFJ Securities International PLC.


41

20. Due from related partiesNature oftransaction 31/12/2013 31/12/2012

Advisory fee Finance

LE LE LE LELogria Holding Ltd. * 38 197073 2213652 40410725 36626606Mena Horne Furnishings Mall ** 106515556Citadel Capital Transportation

Opportunities Ltd.** 128332139Falcon Agriculture Investments Ltd. ** 212634638Orient Investment Properties Ltd. ** 70026Golden Crescent Investment Ltd. 26477 835 26477 835 23997923ASEC Cement Company ** (6455253)

Sphinx Glass Ltd. 5032000Mena Joint Investment Fund 1349691 1349691 1256402Africa Joint Investment Fund 2265986 2265986 751 787Citadel Capital Transportation

I Opportunities II Ltd.** (2986289)

Africa JIF HOLD CO I 1 281 472 164679 1446 151 1 108077

Africa JIF HOLD CO III 4 165889 1851 932 6017821 3955 107

Mena JIF HOLD CO I 1281 466 430676 1 712 142 1108072ASEC Company for Mining (ASCOM) 115352473 115352473 96084 159

Golden Crescent Finco Ltd. * 200988216 200988216 179634462

3 891 605

1 364609

31/12/2012LE

1 530660996336

19. Investments at fair value through profit or loss31/12/2013

LEModern Shorouk for Printing Co. 2412642Al Arafa Investment and Consulting

Osoul Fund -Commercial International Bank 21 119038TAQAArabia

HSBC Fund 192303617QNB certificates 3727

Balance 215839024

The balance represents the amount paid on behalf of Egyptian GeneralPetroleum Corp. in the share capital of Egyptian Refining Company - S.A.E.Private Free Zone Company - one ofthe subsidiaries.

*


42


Nature of transaction 31/12/2013 31/12/2012Advisory fee Finance

LE LE LE LEEmerald Financial Services Ltd. * 189425614 189425614 226367030Nile Valley Petroleum Ltd. 149757 559 149757559 134574758Tawazon for Solid Waste Management

(Tawazon) 1 194 166 1 194 166 1 132 137National Development and Trading

Company ** 15 176505

United Foundries Company ** 64453083Citadel Capital East Africa 26233 26233 23776Citadel Capital - ALQALAA Saudi

Arabia 689038 689038 457040ESACO for Manufacturing, Engineering

and Construction * 1** 54135206Valencia Regional Investments Ltd. 318 178 318 178 55000EI Kateb for Marketing& Distribution Co. 1001 676 1 001 676 4301 673

Ledmore Holdings Ltd. ** 30836885Nahda 4475266 4475266 4056 113Egyptian Company for international

Publication 11152855 11 152855 4250000Underscore International Holdings Ltd 59753 59753 55000ASEC for Manufacturing and Industrial

Projects- ARESCO ** 855440Ecligo 1999997 1999997Egyptian Company for Food Preparation 1000000 I 000000ASEC Electrical Repairs Co. (REPELCO) 526233 526233Egyptian Polypropylene Bags Co. (EPBC) 20000 20000

ASA International Co. 7 119461 7 119461Haider 79694 79694FL Smith 13751 406 13 751 406

Nile Barges 81 892 81 892

Scimitar Production Egypt Ltd. 823882 823 882

Others 51 827753 51 827753

Total 831 351 696 1328395058

Accumulated impairment * (432 145635) (317 128842)

Net 399206061 1 011 266216

58 131 787

58 131 78713645897

31/12/2012LE

1 228375787370

8592444629000

1 1446042337559228475386919000

43I

I

21. Debtors and other debit balances31/12/2013

LEPrepaid expenses 18 131468Deposits with others 48692818Advances to suppliers 304458220Letters of guarantee margin 4293005Imprest 32777647Accrued revenue 38776801Prepaid interest* 16369829Debit balances under settlement 46925550Refundable deposits 5261 505Amounts due from sale of investments 27814000Operation retention 123607359Advances to contractors 31494420Prepayments for purchase of fixed assets 27582970Taxes deducted by others 198898864Custom Authority 2979394Letters of credit 16918967Sundry debit balances 83699730Total 1 028682547

Accumulated impairment (59093247)

Balance 969589300

I

** The Company has acquired subsidiaries during December 2013 and intragroup transactionsbetween the Company and those subsidiaries have been fully eliminated (note 5 and 45).

* Impairment in due from related parties is represented in:Balance as Formed Reversal Foreign Acquisition Balance asat 11112013 during during currency of at 31112/2013

the year * the year * translation subsidiariesdifferences **

LE LE LE LE LE LEESACO for Manufacturing,Engineering and Construction 54 135206 (54 135206)Emerald Financial Services Ltd. 226367030 4 132 149 (63696767) 22623202 189425614

Logria Holding Ltd. 36626606 3784 119 40410725

Golden Crescent Finco Ltd. 198425616 2562600 200988216

Others 1321080 I 321 080

Balance 317 128842 202557765 (63 696767) 28969921 (52814126) 432 145635* Note (39).** Note (5).


44

31/12/2013LE

165363 1937037893328913 64522111375

Total23.1.1 Assets classified as held for sale (investments in subsidiaries)

Esaco Amreya Alexandria forMetal Car Foundries

Company31/12/2013 31/12/2013 31/12/2013

I LE LE LEProperty,plantandequipment(net) 58297798 37799449 69265946Projectsunderconstruction 6423445 63955488Inventories 4433397 5664076 18816172Tradeandotherreceivables(net) 16933382 4185923 992070

and Construction, a subsidiary 70%.The Board ofDirectors ofUnited Foundries decided on December 10, 2012 toseIl its share in Al Amreya Metal Company and Alexandria for Car Foundrieswithout prejudice to any conditions with lending banks and reclassify theinvestments in those companies to non-current asstes held for sale.

23.1 Assets held for sale as at December 31, 2013 are represented in the following:

22. Cash and cash equivalents31/12/2013 31/12/2012

LE LECash on hand 3574 137 202350Banks - current accounts 2013 558 116 254947713Banks - time deposits 92272042 62900Cheques under collection 2001 138Bank certificates 2 100000Banks - LlGs' margin 36425770Total as presented in balance sheet 2 149931 203 255212963Effect of foreign exchange differences 9563878Adjusted cash and cash equivalents 2 149931 203 264776841

23. Disposal group held for saleNational Development and trading Company management decided onDecember 24, 2012 to seil its share in ESACO for Manufacturing Engineering

* Prepaid interest item represents the interest on the loan obtained from ArabInternational Bank to the International Company for refinery consultancy (oneof the subsidiaries - 100%) as the Company has settled the interest in advanceaccording to the signed contract with the bank dated November 4,2012.


on December 31, 2013 includes accrued claims till October 31, 2012 with an

amount of LE 5.1 million. The Company received a warning from Social insurance

45

IEsaco Amreya Metal Alexandria for Total

Company Car Foundries

31/12/2013 31/12/2013 31112/2013 31/12/2013

LE LE LE LE

Provisions 12446000 8466778 2404974 23317752

Bank's overdraft 357685 89676313 90033998

Current portion of long tenn loans 23784656 2540640 2378870 28704 166

Trade and other payables 32777 637 22252921 21 343650 76374208

Creditors and other credit balances * 75 162780 13076993 43234964 131474737

Borrowings 259074532 259074532I Other non-current liabilities 6296638 6296638

I Deferred tax Iiabilities 7081 142 832970 7914112

I Balance 416981 070 47170302 159038771 623 190 143

* Social insurance related to Amreya Metal Company with balance LE 8.6 million

23.2 Liabilities classified as held for sale as at December 31, 2013 are

represented in the following:

23.1.2 Assets held for sale with an amount ofLE 200072 497 as at December 31,

2013 which represents investments in associates (Sudanese Egyptian Bank)

to one of the subsidiaries Crondall Holdings Ltd. (subsidiary 80%). Citadel

Capital Company- parent company- decided to seIl its share in the bank.

The company announced on April 27, 2014 for the sale ofthe entire stake to

Islamic solidarity Bank of Sudan.


Esaco Amreya Alexandria for TotalMetal Car Foundries

Company31/12/2013 31112/2013 31112/2013 31112/2013

LE LE LE LEDebtors and other debit balances 20951 107 9316990 17419381 47687478Due from related parties 651 417 651 417Cash and cash equivalents 336765 76897 48906 462568Goodwill 2350287 75041 679 77 391 966Balance 108027311 59393622 245539642 412960575

46

shareholder ofthe Company.

The shareholders' structureis representedas folIows:Shareholder's name Percentage No.of Value in

% shares LECitadelCapitalPartnersLtd. 26.11 227598220 1 137991 100Soliman Abd Elmohsen Abd Allah Abanami 15.16 132 100000 660500000Emirates International Investments Company 7.49 65318565 326592825

I Others 51.24 446608215 2233041 075I

100 871 625000 4358125000

The Company's authorized capital is LE 6 Billion and the issued and paid-incapital is LE 4 358 125 000 represents 871 625 000 shares distributed to653 718 750 ordinary shares and 217 906 250 preferred shares with par valueLE 5 per share.The preferred share has the advantage of triple voting right comparing withordinary share on the decisions of the Company's extraordinary and ordinarygeneral assembly meetings according to the decision of the Company'sextraordinary general assembly meeting held on May 12, 2008 and alsoparagraph no.(3) of article no.(18) of the Company' s article of associations.And those shares are owned by Citadel Capital Partners Ltd. the principle

LE LECash flow from discontinued operationsNet cash used in operating activities (27 116624) (104433 880)Net cash provided from investing activities 2897842 21 221 620Net cash provided from financing activities 21 034016 153342930Net cash from discontinued operation (3 184766) 70 l30 670

24. Share capital

23.3 Net cash flows resulting from discontinued operationsFor the year ended

31112/2013 31112/2012

Authority as at December 16, 2012 regarding the amount and asking for animmediate payment of LE 1 797 100within 15 days.


47

I

II

IShareholders' credit balancesShareholders' credit balances represent the amounts payable to the shareholdersresulting from:- The Company has purchased ownership share percentages in some of its investee

companies from those shareholders through its subsidiary Citadel Capital forInternational Investments Ltd. (subsidiary 100%).

- Bonus and incentives to employees (shareholders).Shareholders' credit balances as at December 31, 2013 are represented in thefollowing:-

25.

The Company's extra-ordinary general assembly meeting held on October 20,2013 approved the increase of the authorized capital from LE 6 billion to LE9 billion and the increase of the issued capital from LE 4 358 125 000 to LE8 billion , with an increase of LE 3 641 875 000 by issuing 728 375 000 newshares at par value of LE 5 per share, consisting of 182 093 750 preferredshares and 546 281 250 ordinary shares, without issuance costs. The purpose ofthis capital increase is to finance the acquisition of additional shares in itsrelated companies, financing the Company's share contribution in the capitalincreases of some of its related companies and entering into new investmentsand settlement of some of Company's liabilities note (50).Existing shareholders were invited - in accordance with the terms of thesubscription rights - to subscribe in the capital increase on a pro-rata basis totheir shareholdings before the increase and the shareholders in each dass ofshares shall have the right to subscribe to the same dass of shares they currentlyhold on a pro-rata basis before the increase, provided that all shareholders of thesame dass have the same rights according to the article (19) of the Statute ofthe Company and provided that the shareholders shall pay the full amount oftheir contributions in the capital increase without issuance costs within thesubscription period. The subscription in the Company's capital increase istaking place.The Board of Directors approved in its meeting held on February 13, 2014 tocover the subscription of the unsubscribed Company's shares in the capitalincrease through offsetting the shareholders' credit balances that are payable bythe Company (Shareholders' credit balances note 25) against the subscriptionprice of the shares.


48

The fair value reserve comprises the cumulative net change in the fair valueof available-for-sale financial assets until the investments are derecognisedor impaired.

III

26.2

26. Reserves26.1 Legal reserve

As per the Company's statutes, 5% of net profit for the year is set aside toform a legal reserve. Transfer to the legal reserve may be suspended once thereserve reaches 50% ofthe Company's issued share capital. However, ifthereserve balance falls below 50% of the Company's issued share capitaltransfers to the legal reserve are required to be resumed. The legal reserve isnon-distributable but can be used to offset losses or to increase the issuedshare capital.Fair value reserve

31/12/2013LE

547233410596548465343000000155 1350151300000006930000058771 265427345193948782032325 19625935453182483032669800024750000233870001893750010400000999639390900008 1061207847476757500069999955531280

105 1226652323 160875

Citadel Capital Partners Ud.Emirates International Investment Company LLCDH Investors LimitedMansour and Maghraby for Investment and Development S.A.EGrouped Holdings LtdMamdouh Mohamed Fathy AbbasKareem Sedky Sedky EL SerafyMagdy Mohamed Mustafa SalehLedville Holdings LimitedTamer Abd EL Hamed Abou BakrKhaled Abd EL Hamed Abou BakrKarnation LimitedAhmed Mokhtar Mohamed EI RashidiPartex Trading Corp.Mohamed Mokhtar Mohamed EL RashidiAdena Commercial Corp.Power investment EuropeMZ Investments S.A.E.Garth investing LimitedHassan Mohamed Hassan DarwishAbdel Khalek Mohamed Mohamed AyadAhmed Moheb Mahmoud EIMehelmyHossam Hussien Nagy AlyAhmed Ibrahim Wagih EI ShamyOthersBalance

Shareholders' name


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I•

693087693087

31/12/2012Asset LiabilityLE LE693087

29. Deferred tax (liabilities) assets31/12/2013

Asset LiabilityLE LE

Fixed assets depreciation 85022782Hedge reserve-swap contract 40992061Provisions 8341 317Deferred tax liabilities related to Berberfor electricity Ltd. Co. 14639683Deferred tax liabilities related toZahanaCo. 44889655

I Deferred tax liabilities related to ReadyMix 2743029Tax losses 227099330Deferred tax liabilities related to KURailways Holdings Ltd. 26378 711Others 151 521 617

ß Total deferred tax assets and liabilities 235440647 366 187538Net deferred tax (Iiabilities) asset (130746 891)

II 66

31/12/2013 31/12/2012LE LE

Meter deposits 6996479Gas consumption deposits 91 925488Power consumption deposits 4299900Others 3569722Balance 106791 589

28.1 Deposits from others

Balance 147584443 10787486* This balance represents the amount due from Tanweer for Marketing and

Distribution Company (Tanweer) (subsidiary - 99.88%) for purchasinginvestment in Dar El-Sherouk Ltd.-BVI- for interest of the shareholders of thementioned company.

28. Long term Iiabilities31/12/2013 31/12/2012

LE LECreditors-purchase of investments * 10787486 10787486Port -Said ports authority 13 509550End of service benefits 9634226Deposits from others (28.1) 106791 589Social Insurance authority 3593754Others 3267838


379252724

(49076448)

87502706502111523783202

LE255980 135263835434468434

31/12/2012

67

The main shareholder of the Company - 26.11%.*

3220861 3220861

16450410 1645041043421 617 43421 617

161007 161 0073798 3798

30957 127 30957 1271 054753 1 0547536 140951 6 1409519191 558 9 191 558

47935 47935177 116 177 116571 093 571 093

25467309 25467309274069364

Advisory fee FinanceLE LE LE

110770360 110770360(10 507 159) 36940 628 26433 469

Citadel Capital Partners Ltd.*Mena Glass Ltd.Crondall Holdings Ltd. **National Company for AgriculturalInvestment (Gozour) **Silverstone Capital Investments Ltd. **Pharos Holding Co.ASCOM for Carbonate and ChemiealsManufacturing Co.Erco GroupASEC Automation Europe Co.ASEC Automation Cc-Free ZoneNational Sudanese Pension FundMedcomMisr Cement Qena Co.Grandview Investment HoldingEgus Co.Genco GroupCity GasOthersBalanceI

I

31/12/2013Nature oftransaction

30. Banks overdraft31112/2013 31112/2012

LE LEWafra Agriculture S.A.E 7044079Mena Horne Fumishings Mall 18918Silverstone Capital Investments Ltd. 81 561 115United Foundries Company 63385419Falcon Agriculture Investments Ltd. 329064569KU Railways Holdings Ltd. 10660354National Development and Trading Company 342614856Balance 834349310

31. Due to related parties

The Parent Company has carried-forward tax losses from previous years which werenot recognized because it is not probable that future taxable profit will be availableagainst which the Group can utilise the benefits thereform.


68

B

III

33. Creditors and other credit balances31/12/2013 31112/2012

LE LETax Authority 403602013 23327700Accrued expenses 557812421 71128110

• Accrued interest 146666345 39294929National Authority for Social Insurance 21 011 584 446789Advances from customers 119970642Egyptian Natural Gas Holding Company

457862357(EGAS)Refundable deposits 1 068 177Uneamed revenues 13463 938Subcontractors 7066001Creditors - purchase of fixed assets 18263533Deposits from others 56542534Dividend payable - previous years 38323 581 2926499Sundry credit balances 118 169848 8239758

Balance 1959822974 145363785

32. Trade and other payables31/12/2013 31/12/2012

LE LE

Suppliers 3088588621 12323401Notes payables 175095 122 146978713

Balance 3263683743 159302 114

The Company during December 2013 has acquired subsidiaries and the intragroup transactions have been fully eliminated (note 5, 45).

**


3596963

869725152125421 74785837097464324199

4 110610

93739917341 004

For the year ended31/12/2013 3111212012

LE LE4134178 3619472

69

III

Company's nameMena Glass Ltd.Mena Horne Furnishings MallCitadel Capital Transportation Opportunities Ud.Falcon Agriculture Investments Ud.Golden Crescent Investment Ltd.*Orient Investment Properties Ltd.Sphinx Glass Ltd.

35. Related party transactions35.1 Advisory fee

Advisory fee item presented in the income statement is represented in theadvisory services provided to related parties according to signed contractsas follows:

* Note (5).Expected claims provision related to expected claims were made by someexternal parties in connection with the Company's operations. The informationusually required by Accounting Standards is not disclosed because themanagement believes that it would seriously prejudice the outcome of thenegotiation with that external party. The management are reviewing the provisionevery year and the amount provided is adjusted based on latest development,discussions and agreements with the external party.

1 686742(2837229)(17445245)477164016

2128980331 737030

281 124685

LE

Total

22 197354

22 197354

2128980331 737030

219776940 39 150391

1 686742(2837229)(17445245)415 816271 39 150391

Balance at the beginning oftheyearProvisions formed during the yearAcquisition of subsidiaries *Foreign currency translationdifferencesProvisions used during the yearProvisions reversedBalance

34. ProvisionExpected Employee Otherclaims benefit Provisions

provision provisionLE LE LE


26821 686 21 0403518438010 12515253

18464 1495999484 5321 6744248053 47875792912675 4 148 584

21 377302

For the year ended31112/2013 31112/2012

LE LE

70

Company's nameNational Cornpany for Trading and DevelopmentUnited Foundries CompanyGolden Crescent Finco Ltd.Mena Horne Fumishings MallCitadel Capital Transportation Opportunities Ltd.Grandview Investment HoldingOrient Investments Properties Ltd.

I,

Interest incomeInterest income included in financing cost note no.(40) includes an amountof LE 67 009 582 represents accrued interest income according to signedcontracts from other related parties as follows:

35.2

I

* The Company did not recognize advisory fees with an amount LE 43 327 784and LE 8 022 800 for the year ended December 31,2013 (against LE38323 790 and LE 5 337657 for the year ended Decernber 31, 2012) relatedto Logria Holding Ltd. and Golden Crescent Investments Ltd. in accordancewith the signed contracts due to inadequate assurance conceming the revenuerecognition and collection conditions.


Company's name LE LEASEC Cement Company 12032655 10533977Silverstone Capital Investment Ud. 3879290 3402831Citadel Capital Transportation Opportunities IILtd. 5613 782 5085970Africa Joint Investment Fund 3223 932 3849946Mena Joint Investment Fund 1 853629 2540 150Africa JIF HOLD CO I 489709 697034Africa JIF HOLD CO III 1 388393 2444 014Mena JIF HOLD CO I 489709 697028Ledmore Holdings Ltd. 875 144 766273Sphinx Glass 4939 125Crondall Holding Ltd. 6369726Scimitar Production Egypt Ud. 34773 148Total 102451433 63097728


36. Share of (Ioss) profit of equity accounted investees:For the year ended

31/12/2013 31/12/2012LE LE

EI Kateb for Marketing& Distribution Co. (1 454 156) (911 884)Pharos Holding Co. (1 800225) (2 198389)Elsharq Book Stores Co. (780948) (481 941)ASEC Company for Mining (ASCOM) (19114360) (25746108)Silverstone Capital Investments Ltd. 26027419 40461450

I Dar EI-Sherouk Ltd. (526456) (7769284)Crondall Holdings Ltd. 11223204 28872 759National Development & Trading Company (321251 181)United Foundries Company (44 139916)Mena Glass Ltd. (7485501) (7 175438)Tanmeyah Company S.A.E 2570386 1 153 455Mena Horne FurnishingsMall (19299419) (18780590)Citadel Capital Transportation Opportunities Ltd. (52733386) (24293643)Tawazon for Solid Waste Management (Tawazon) (4619256) (1 896483)Ledmore Holdings Ltd. (3890474) (3692828)Total (71 883 172) (387 850 021)

37. Net results of other operationOther operation are represented in the net results of Wafra Agricultural Company andits subsidiaries.

For the year ended31/12/2013 31/12/2012

I LE LESales 11 723 175 7824985Cost of sales (9658300) (33006914)

I Net profit (loss) for the year 2064875 (25 181929)

III 71

10646828367009582

147602314053 160

152294083996817(430852)(205699)


LE LECompany's nameFalcon Agriculture Investments Ltd.ASEC Company for Mining (ASCOM)Asec Cement CompanyPharos Holdings Ltd.Total


Note For the year endedno. 31/12/2013 31/12/2012

LE LE

(584927)(6) 2206792(13) 14142705(20) 202557765 42475351(34) 1 737030 7000000

(741 836) 3000274(34) (17445245)

(2571 552)2743580

72

I

Gain on sale of investments at fair value through profitand lossImpairment loss on fixed assetsImpairment on available -for- sale investmentsImpairment loss on due from related partiesProvisions formedNet change in the fair value of investments at fair valuethrough profit and lossProvisions no longer neededOther incomeInventory write-down

I

39. Other expenses

**

* Consultancy expenses inc1udean amount of US.$ 3 295 428 (equivalent to LE22 578 674) for the year ended December 31, 2013 against US.$ 3 079 715(equivalent to LE 18 690 482 for the year ended December 31, 2012)represents the advisory fees due according to the signed contract withFinancial Holding International Co. (one ofthe group shareholders).The Company's extraordinary general assembly meeting held on May 12,2008 approved the management contract with Citadel Capital Partners Ltd.(the principal shareholder 26.11 %) which states that the mentioned companyprovides management duties for fees based on 10% of the net annual profitavailable for distribution .This agreement shall remain in effect as long asCitadel Capital Partners owns 15%or more Preferred shares.

38. Administrative and general expensesFor the year ended

31/12/2013 31/12/2012LE LE

Wages , salaries and similar items 78737471 117797573Consultancy * 67276837 42228770Advertising and public relations 5955723 6768508Travel , accommodation and transportations 8 153824 7117928Management fee ** 1 165600Other 65508757 68208078Total 226798212 242 120857


LE LE(123 928 370) 20855830

694479 101393

(123233 891) 20957223

166682305 23 519515(289 916 196) (2562292)(123233891) 20957223


(691 740235)871 625000(0.79)

(374655290)871625000(0.43)


LE LE(384 870 029) (702 358 039)


LE LE87 654 682 109226 436

(151 307 595) (179 041 695)9563 878 15295765

(54089035) (54519494)

54682417136686298

LELE315793

(63696767)229752

(20)

Note For the year endedno. 31112/2013 31112/2012

73

IIII

Foreign currency translation differences of foreign operationsNet change in the fair value of available-for-sale investmentTotal finance (expenses) income recognised in equity (aftertax)Attributable to:Equity holders of the CompanyNon - controlling interest

I

Finance (expenses) income recognised in equity42.

Net loss for the yearNet loss for equity holders ofthe parent CompanyWeighted average number of sharesEarnings per share

41. Earnings per share

Interest income - note no. (35.2)Interest expenses - note no.(27)Foreign currency translation differencesNet

40. Finance costs (net)

Loss on sale of fixed assetsReversal of Impairment on due from related partiesOther expensesTotal


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75

Financial Services sectorCitadel Capital S.A.E.Citadel Capital Ud.Sequoia Williow Investments Ud.Arab Company for Financial investmentsLotus Alliance LimitedCitadel Capital Holding for Financial Investments-Free ZoneCitadel Capital for International Investments UdInternational for Mining ConsultationInternational for refinery ConsultationTanweer for Marketing and Distribution Company (Tanweer)Financial Unlimited for Financial ConsultingCitadel Company for Investment Promotion

Specialist real estate sectorMena Horne Furnishings Malls Ud Group.

MetallurgyUnited Foundries Group

Cement sectorNational Development and Trading Group

IIII

(*******)

(******)

(*****)

(****)I

(***) Transportation and logisticsAfrica Railways HoldingAfrica Railways LimitedCitadel Capital Transportation Opportunities Ud. GroupKU Railways Holding LimitedAmbience Ventures Ltd.

Energy sectorSilverstone Capital Investments Ud. GroupOrient Investment Properties Ud. GroupLedmore Holdings Ltd.

Agriculture food industriesWafraAgriculture S.A.E.Falcon for Agriculture Investments Group

(**)

(*)


76

Salaries taxThe Company deducts the salaries tax according to tax law no. 91 / 2005 and theCompany's books inspected for the period from launch till the date of 31/12/2009but the authority did not inform the Company with results yet. And the years from2010/2012 have not been inspected yet.

II

44. Tax statusCorporate taxThe Company submitted its tax returns on regular basis for the years from 2005 to2013 according to tax law No. 91/2005. The Company's books have not beeninspected yet.

National Company for Touristic and Property InvestmentUnited for PetroleumRefining ConsultationSpecialized for Refining ConsultingSpecialized for Real Estate CompanyNational Company for Refining ConsultationCitadel Capital AigeriaValencia Trading Holding Ltd.Andalusia Trading InvestmentsLotus Alliance LimitedCitadel Capital Financing Corp.Brennan Solutions Ltd.Mena Enterprises Ltd.Alcott Bedford Investments Ltd.Eco-Logic Ltd.Alder Burke Investments Ltd.Black Anchor Holdings Ltd.Cobalt MendozaAfrica Railways Investments Ltd.Darley Dale Investments Ltd.Citadel Capital Joint Investment Fund Management LimitedMena Joint Investment FundTrimestone Assets Holding Limited - BVICardinal Vine Investments Ltd.Global Service Realty Ltd.Crondall Holdings Ltd.

I


77

Arab Republic ofEgypt 99.88

Arab Republic of Egypt 99.99

Arab Republic ofEgypt 99.99Arab Republic of Egypt 99.99


Republic of Algeria 99.99British Virgin Island 100.00

Country of incorporation Ownership interestDirect Indirect% %

Arab Republic of Egypt-Free Zone 99.99

British Virgin Island 100.00Arab Republic of Egypt 99.99Arab Republic of Egypt 99.99Arab Republic of Egypt 94.00

Arab Republic ofEgypt 99.88



Citadel Capital Holding for FinancialInvestments-Free ZoneCitadel Capital for InternationalInvestments Ud.International for Mining ConsultationInternational for Refinery ConsultationArab Company for Financial InvestmentsTanweer for Marketing and DistributionCompany (Tanweer)Financial Unlimited for FinancialConsultingCitadel Company for InvestmentPromotionNational Company for Touristic andProperty InvestmentUnited for Petroleum RefiningConsultationSpecialized for Refining ConsultingSpecialized for Real Estate CompanyNational Company for RefiningConsultationCitadel Capital AlgeriaCitadel Capital Ud.

III

Company's name

45. Group entities

Withholding taxThe Company applies the withholding tax provisions on its transactions accordingto tax law No. 91/2005 and no tax inspection for withholding tax has been takenplace yet.

Stamp taxThe Company was inspected till July 31, 2006 and paid all the accrued amountsaccording to the Internal Committee decision and for the period from August 1, 2006to December 31, 2012 has been inspected and the dispute has transferred to InternalCommittee in the Authority.


78


Country of incorporation Ownership interest

Company's nameDirect Indirect% 0/0

Valencia Trading Holding Ltd. British Virgin Island 100.00Andalusia Trading Investments British Virgin Island 100.00Lotus Alliance Limited British Virgin Island 85.70Citadel Capital Financing Corp. British Virgin Island 100.00Ambience Ventures Ltd. British Virgin Island 100.00Africa Railways Limited * British Virgin Island 40.22Sequoia Williow Investments Ltd. British Virgin Island 100.00Brennan Solutions Ltd. British Virgin Island 100.00Mena Enterprises Ltd. British Virgin Island 100.00Alcott Bedford Investments Ltd. British Virgin Island 100.00Eco-Logic Ltd. British Virgin Island 100.00Alder Burke Investments Ltd. British Virgin Island 100.00Black Anchor Holdings Ltd. British Virgin Island 100.00Cobalt Mendoza British Virgin Island 100.00Africa Railways Investments Ltd. British Virgin Island 100.00Darley Dale Investments Ltd. British Virgin Island 100.00Africa Railways Holding Republic ofMauritius 51.02Citadel Capital Joint Investment FundManagement Limited Republic of Mauritius 100.00Mena Joint Investment Fund Luxembourg 100.00Wafra Agriculture S.A.E Arab Republic of Egypt 99.99

I Valencia Assets Holding Ltd. British Virgin Island 100.00Sabina for Integrated Solutions Sudan 96.00Concord Agriculture South Sudan 96.00Trimestone Assets Holding Limited - BVI British Virgin Island 100.00Cardinal Vine Investments Ltd. British Virgin Island 100.00Global Services Realty British Virgin Island 100.00

Silverstone Capital Investments Ltd. British Virgin Island 56.37

Taqa Arabia Company Arab Republic ofEgypt 80.77I Gas and Energy Company (GENCO

D Group) - SAE Arab Republic ofEgypt 99.99

I Taqa for Electricity ,Water and Cooling-

SAE Arab Republic ofEgypt 98.74Taqa for Marketing Petroleum Products-

SAE Arab Republic ofEgypt 99.99

79



Direct IndirectCompany's name

0/0 %Gas and Energy Group Limited British Virgin Island 99.99Genco for Mechanical and Electricity

Work Qatar 99.99

Qatar Gas Group Limited * Qatar 45.00

Arab Company for Gas Services * Libya 49.00

Arabian Libyan Company for Energy Libya 65.00National Development and trading

Company Arab Republic of Egypt 47.65 12.84

Arab Swiss Engineering Co. Arab Republic of Egypt 99.97

ASEC for Manufacturing and Industries

Project Co. Arab Republic of Egypt 99.80

ASEC Cement Co. Arab Republic of Egypt 61.05

ASEC Environmental Protection Co.(ASENPRO) Arab Republic of Egypt 63.01

ASEC Automation Co. Arab Republic of Egypt 53.64

ESACO for Manufacturing Engineering

and Construction Arab Republic of Egypt 70.00

Grandiose Services Ltd. British Virgin Island 100

ASEC Integrated - Sudan Sudan 99.90

Al Takamoul for Cement Ltd. Co. Sudan 51

ASEC Algeria Cement Co. Algeria 60.89

ASEC Syria Cement Co. Syria 99.99

Zahana Cement Company * Algeria 35.00

Dejalfa Offshore British Virgin Island 54.53

ASEC Trading Company Arab Republic of Egypt 99.88

ASEC Ready Mix Arab Republic of Egypt 54.12

ASEC Minya Cement Company * Arab Republic of Egypt 45.12

Berber for Electricity - limited Sudan 51.00

United Foundries Company Arab Republic of Egypt 29.29 23.34

Alexandria for Car Foundries Arab Republic of Egypt 99.98

Amreya for Metal Arab Republic of Egypt 99.96

I Ledmore Holdings Ltd. British Virgin Island 63.75

National Company for Marine Petroleum Arab Republic ofEgypt-I Services "PETROMAR" FZ 77.87

Mashreq Petroleum Company Arab Republic of Egypt 91.00

80



Company's nameDirect Indirect% 0/0

EI Dawlia for Bunkering Services Arab Republic of Egypt 70.00Mena Horne Furnishings Malls Ltd. British Virgin Island 56.29Bonian for Trade and Development Arab Republic of Egypt 99.99Bright Living Arab Republic of Egypt 56.17Investment Company for Modem Fumiture Arab Republic of Egypt 99.88Citadel Capital TransportationOpportunities Ltd. British Virgin Island 60.15Nile Logistics S.A.E. Arab Republic of Egypt 99.99Citadel Capital TransportationOpportunities 11Ltd- Malta Republic ofMauritius 68.87National Company for MultimodalTransport S.A.E. Arab Republic of Egypt 99.88National Company for RiverTransportation - Nile Cargo S.A.E. Arab Republic of Egypt 99.99

I National Company for River PortsManagement S.A.E. Arab Republic ofEgypt 99.88National Company for Martime ClearanceS.A.E. Arab Republic of Egypt 99.98EL -Orouba Company for LandTransportation S.A.E. Arab Republic ofEgypt 99.98NMT for Trading S.A.E Arab Republic ofEgypt 99.99National Company for Marina PortsManagement Arab Republic of Egypt 99.90NRTC Integrated Solutions Co Ltd. Sudan 99.00Nile barges for River transport Co Ltd. Sudan 99.00Regional River Investment Ltd British Virgin Island 100.00Falcon for Agriculture Investments * British Virgin Island 42.09National Company for Investments andAgriculture Arab Republic of Egypt 99.99National Company for Food products Arab Republic of Egypt 99.99Dina Company for Agriculture andInvestments Arab Republic of Egypt 99.99Dina for Auto Services Arab Republic of Egypt 99.00Arab Company for Services and Trade Arab Republic of Egypt 99.67

I National Company for Agriculture Arab Republic ofEgypt 99.88

81

Country of incorporation Ownership interestDirect Indirect

Company's name0/0 %

ProductsEl-Eguizy International for Economic

Development Arab Republic of Egypt 99.95National Company for Integrated Food Arab Republic of Egypt 99.99Misr October Company for Food Products Arab Republic of Egypt 99.99Royal Food Company Arab Republic of Egypt 99.99Up-Date Company for Food Products Arab Republic of Egypt 85.00EI Rashidi EI Mizan Arab Republic of Egypt 99.99Nile for Food Products "Enjoy" Arab Republic of Egypt 99.99Investments Company for Dairy Products Arab Republic of Egypt 99.99

EI Rashidi Company for Integrated

Solutions Sudan 99.99

Tiba Farms for Agriculture Developments Arab Republic of Egypt 95.88Dina for Agriculture Development Arab Republic ofEgypt 100.00

National Company for Dairy Exchange Arab Republic ofEgypt 100.00

Mena Development Limited British Virgin Island 100.00

Everys Holdings Limited British Virgin Island 100.00

Orient Investment Properties Ltd. * British Virgin Island 35.93

Arab Refining Company - S.A.E. Arab Republic of Egypt 63.32

Egyptian Refining Company - S.A.E.-

Free Zone * Arab Republic of Egypt 48.25

National Refining Company - S.A.E. Arab Republic of Egypt 63.32

KU Railways Holding Limited-KURH Kenya 51.00

E A Rail & Handling Logistics Co. Limited Republic ofMauritius 100.00

East African Rail And Handling Logistics

Limited Kenya 100.00

RVR Investments (Pty) Ltd Republic of Mauritius 100.00

Crondall Holdings Ltd. British Virgin Island 80.00

Capella Management Investments Inc.

Company British Virgin Island 100.00

I Lotus Management Investment Ltd.

I Company British Virgin Island 100.00

Cordoba Investment Services Inc.I Company British Virgin Island 100.00


82

II

Liquidity riskLiquidity risk is represented in the factors, which may affect the Company'sability to pay part of or full amount of its liabilities. According to theCompany's policy, sufficient cash balances are retained to meet theCompany's current liabilities which minimize the liquidity risk.

48.2

48. Financial instruments and management of related risksThe Group's financial instruments are represented in the financial assets and liabilities.Financial assets include cash and cash equivalents, other investments, and trade andother receivables while financialliabilities include; loans and borrowing and trade andother payables. Note (no.3) include significant accounting policies for the recognitionand measurement of the important financial instruments and related revenues andexpenses by the Company to minimize the consequences of such risks.48.1 Credit risk

Credit risk is the risk that one party will fail to discharge his obligation andcause the other party to incur financial loss. The financial assets representingamounts due from customers. Strict credit control is maintained and furtherappropriate level of impairment loss is made. The credit risk on financialinstrument by ensuring that investments are made only after careful creditevaluation for these assets.

47. Contingent liabilitiesThe Company guarantees some related parties against loans and facilities obtained bythose parties from banks.

46. Employees Stock Option PlanThe Company's extraordinary meeting held on February 20, 2008 approved to add anew article to the Company Article of Association to adopt a plan or more to motivateemployees, managers and executive board of directors - Employees stock option plan(ESOP) in accordance with decision no. 282 for 2005 which modified executiveregulation for the law no. 159 / 1981.On June 22, 2008 the Capital Market Authority approved the ESOP plan and theCompany does not start to apply it yet.

The Group has the right to appoint the majority of the board of directorsmembers which enables the Group to control the financial and operationalpolices. Consequently, these Companies have been consolidated.

*

Citadel Capital CompanyNotes to the consolidatcd financial statements for the year ended December 31, 2013

83

48.5 Market riskThe Company's objectives when managing capital are to safeguard themanagement's ability to continue as a going concern in order to providereturns to the benefits to the Company's shareholders and to maintain anoptimal capital structure to reduce the cost of capital.In order to maintain or adjust the capital structure, management may adjustthe amount of distribution paid to shareholders, return capital toshareholders, issue new shares or seIl assets to reduce debt.

II

c- Price riskThe Company is exposed to market price risk on equity instrumentand according to the company's investment policy, the followingprocedures are undertaken to reduce the effect of this risk.- Performing the necessary studies before investment decision in

order to verify that investment is made in potential securities.- Diversification of investments in different sectors and industries.- Performing continuous studies required to follow up the

company's investments and their development.

B- Interest rate riskThe Company's income and operating cash flows are substantiallyindependent of changes in market interest rates. As the marketdictates, the Company sometimes borrows at variable rates leavingcertain exposure to changes in interest rate risk.

48.4 Market riskA- Foreign currencies risk

- 'The foreign currencies exchange risk represents the risk offluctuation in exchange rates, which in turn affects theCompany's cash inflows and outflows as weIl as the value ofits assets and liabilities in foreign currencies.As disclosed in note no. (3,2) the Company has used theprevailing exchange rates to revaluate monetary assets andliabilities at the financial position date.

48.3 Financial instruments' fair valuesAccording to the valuation bases used to evaluate the assets andliabilities of the Company which have been stated in the accompanyingnotes to the financial position, the financial instruments' fair value doesnot substantially deviate from their book values at the balance sheetdate.


84

49. Significant EventsThe Company's Extraordinary General Assembly meeting held on October 20,2013 and approved the following decisions:

To increase the Company's authorized capital from LE 6 billion to LE9 billion and to increase the issued capital from LE 4 358 125 000 to LE8 billion, with an increase of LE 3 641 875 000 by issuing 728 375 000 newshares at par value of LE 5 per share without issuance costs, consisting of182 093 750 preferred shares and 546 281 250 ordinary shares, for thepurpose of financing the acquisition of additional shares in its relatedcompanies, financing the Company's share in the capital increase of some ofits related companies and entering into new investments.To invite existing shareholders - in accordance with the terms of thesubscription rights - to subscribe in the capital increase on a pro-rata basis inthe issued capital before the increase provided that the shareholders in eachclass of shares shall have the right to subscribe for the same class of sharesthey currently hold on a pro-rata basis before the increase, and provided thatall shareholders of the same class shall have the same rights according to thearticle (19) of the Statute of the Company and to pay the full amount of theircontributions in the capital increase without issuance costs within thesubscription period.Amending the statute of the Company in accordance with the Capital MarketLaw and its executive regulations on the basis that the Company is involvedin establishing other companies and participating in the capital increases ofother companies pursuant to the provision of article nO.27 of the CapitalMarket Law and article no.122 of its executive regulations, provided thatrequired legal procedures for amending the statute of the company will takeplace after completing the required legal procedures for the aforementionedcapital increase.Approval to change the Company's name to reflect its transformation into aninvestment holding company in the light of the aforementioned resolutions.The Extraordinary General Assembly of the Company was informed of theprevious decisions of the Ordinary General Assembly held on June 2, 2013,which approved the valuation of the fair values determined by theindependent financial advisor as well as the related party contracts.As the Ordinary General Assembly approved on June 2,2013 the conclusionof agreement to increase the Company's shares in some of its investees forthe following sectors:

EnergyTransportation and logistical supportAgriculture and food industriesCementOther sectors


85

51. Capital CommitmentsThe capital commitmentsas at December31, 2013 representedin the following:

1 370937417

1 35049991720437500Incentives to employees (shareholders)

Total

31112/2013LE

383 2326406665740

221 3744901000000005500000006239701016015 53510814502

Citadel Capital Partners Ltd.United GroupGrouped Holdings Ltd.Fenix One and Co Ltd.Benu One Ltd.Power Investments EuropeMamdouh Mohamed Fathy AbbasOthers

II

50-2 Shareholders' credit balancesSubsequent to the balance sheet date the value of the credit balances owedto the shareholders in consideration for the purehase of the abovementioned investments and for employees' (shareholders) incentives havebeen credited with an amount of LE 1 350 499 917 and LE 20 437 500respectively with a total amount of LE 1 370 937 417 against LE2323 160875 for the year ended December 31, 2013 (note 25) with a grossamount of LE 3 694 098 292.The amounts that were credited for shareholders subsequent to the balancesheet date are as folIows:

50. Subsequent Events50-1 Investments

Subsequent to December 31, 2013, the Company has purchased financialinvestments from shareholders of the Company through the Company andits 100% owned subsidiary, Citadel Capital for International InvestmentsLtd. for the purpose of increasing the Company's ownership sharepercentages in some investee companies. The value of the investmentspurchased during the subsequent period to the balance sheet date is LE1 344562412 against LE 2 167786600 during year 2013.

The General Assembly also agreed to grant management of the Company theauthority to determine the appropriate timing to enter into those agreements orto reject it and to allow the members of the board of directors to enter intorelated party agreement with respect to the sale of any shares they hold in thesecompanies. The Assembly further resolved to vest the Company's managementwith the rights to enter into similar agreements with the same shareholders orother shareholders in these companies as long as these agreements are with thesame basic terms and conditions previously referred to. The required proceduresare being carried out in this respect.


33041281

86318573363 187

689390

13 148777

4812916384415342364

3111212012LE

253016522731

2555855526643377

EGPEGPEGP

309075EGP309075

EGP

EGPEGPEGP

31112/2013LE

partNot completed part

currency

533797091

2526632331271123768878129264611492607236338

31/12/2012LE

476565600

218995

86

253016522731

25558555

Not completed Contract

2050150933500028401 505

2040000

17450750

289895020348048

581296

ASEC forMiningCompany(Ascom)Nilevalleygas companyUnionTrading and ElectricEngineeringoffice paving aroadMatcomengineeringconstruction&& tradingcompany

B Matcomengineeringconstruction& & tradingcompanyVeoliawater systemElject

Contractamount

Contractor

51.2 ASEC Minya Cement Company (formally Arab National CementCompany)

Euro 290018US dollar 25613 580US dollar 26 115044EGP 1292646DZD 1261349DZD 7942104

609778653

31/1212013LE

Euro 547023300

US dollar 240 612

302203683591375566912926461418840089337500

5700000034603

completed currencypart

Not completed part

FLSmidthDerunarkCompany 57 000 000SARLMHDA 12500000ASECforMiningCompany(Ascom) 763 160EnergyaCompany 23 699 815EnergyaCompany 9 015 848TCBCompany 2 909211CTCCompany 39 500 000CetimCompany 122850000

amount

51.1 Asec Algeria Cement Company (Asec Cement)Contractor Contract Not Contract


87

52.4 ASEC for Manufacturing and Industries projectCo. (ARESCO)

31/12/2013 31/12/2012

EURO US.$ LE EURO US.$ LELetters ofguarantee 8002533 926645 62471 634 13646922 I 398784 94244216

=====

2212349

------------72 079884

46978677

31/12/2012LE

I=======

1 122570

52.3 ASEC Environmental Protection Co.(ASENPRO)Letters of guarantee

====

5873028652.2 Arab Swiss Engineering Co. (ASEC)Letters of guarantee

3733686452.1 ASEC Automation Co. (ASA)Letters of guarantee

31/12/2013LE

52. Contingent liabilitiesThe contingent liabilities as at December 31, 2013 are represented in thefollowing:

5012822

31/12/2012LE

675000

3285000

370000

582472100350

Contractamount

Contractamount

31/12/2013LE

Workshop (1) 675000

Work shop (7) 3285000

Work shop (9) 370000

Northwall ofthe factory

Self-extinguishingsystemin the factory 100350

0 Legal consultancyfees 2400000

Total 6830350

51.3 ASEC for Manufacturing and Industries project Co. (ARESCO)


US.$

88

II

54. Comparative figuresCertain reclassification has been made to the comparative figures in order to conformto current year presentation.

53. Potential tax liabilitiesOn 22 April 2010, the Egyptian Tax Authority issued an executive seizure letterform (23) for the Arab Swiss Engineering Company "ASEC", a subsidiarycompany, against an outstanding corporate taxes balance of LE 72 491 234 for theyears 1978 to 2004. Accordingly Arab Swiss Engineering Company "ASEC"signed an agreement with tax Authority whereby it makes payments with anamount of LE 26 million till December 31, 2013 and accordingly the due balancetill December 31, 2013 amounted to LE 9 million based on form (9 A) seizure ofTax Authority.

United Foundries Company guaranteed Amreya Metal Company up to LE 2million in the favor of Egypt factors Company.

2384681 126

174239809211

EUROLE

31/12/2012

52.5 United Foundries Company

31/12/2013

LE EURO US.$

Letters ofguarantee(outstanding) 333264 146 100Letters ofguarantee (cover) 27329 19900

Letters of credit(outstanding) 3 136901Letters of credit(cover) 35613


83

48.5 Market riskThe Company's objectives when managing capital are to safeguard themanagement's ability to continue as a going concern in order to providereturns to the benefits to the Company's shareholders and to maintain anoptimal capital structure to reduce the cost of capital.In order to maintain or adjust the capital structure, management may adjustthe amount of distribution paid to shareholders, return capital toshareholders, issue new shares or seIl assets to reduce debt.

II

c- Price riskThe Company is exposed to market price risk on equity instrumentand according to the company's investment policy, the followingprocedures are undertaken to reduce the effect of this risk.- Performing the necessary studies before investment decision in

order to verify that investment is made in potential securities.- Diversification of investments in different sectors and industries.- Performing continuous studies required to follow up the

company's investments and their development.

B- Interest rate riskThe Company's income and operating cash flows are substantiallyindependent of changes in market interest rates. As the marketdictates, the Company sometimes borrows at variable rates leavingcertain exposure to changes in interest rate risk.

48.4 Market riskA- Foreign currencies risk

- 'The foreign currencies exchange risk represents the risk offluctuation in exchange rates, which in turn affects theCompany's cash inflows and outflows as weIl as the value ofits assets and liabilities in foreign currencies.As disclosed in note no. (3,2) the Company has used theprevailing exchange rates to revaluate monetary assets andliabilities at the financial position date.

48.3 Financial instruments' fair valuesAccording to the valuation bases used to evaluate the assets andliabilities of the Company which have been stated in the accompanyingnotes to the financial position, the financial instruments' fair value doesnot substantially deviate from their book values at the balance sheetdate.


84

49. Significant EventsThe Company's Extraordinary General Assembly meeting held on October 20,2013 and approved the following decisions:

To increase the Company's authorized capital from LE 6 billion to LE9 billion and to increase the issued capital from LE 4 358 125 000 to LE8 billion, with an increase of LE 3 641 875 000 by issuing 728 375 000 newshares at par value of LE 5 per share without issuance costs, consisting of182 093 750 preferred shares and 546 281 250 ordinary shares, for thepurpose of financing the acquisition of additional shares in its relatedcompanies, financing the Company's share in the capital increase of some ofits related companies and entering into new investments.To invite existing shareholders - in accordance with the terms of thesubscription rights - to subscribe in the capital increase on a pro-rata basis inthe issued capital before the increase provided that the shareholders in eachclass of shares shall have the right to subscribe for the same class of sharesthey currently hold on a pro-rata basis before the increase, and provided thatall shareholders of the same class shall have the same rights according to thearticle (19) of the Statute of the Company and to pay the full amount of theircontributions in the capital increase without issuance costs within thesubscription period.Amending the statute of the Company in accordance with the Capital MarketLaw and its executive regulations on the basis that the Company is involvedin establishing other companies and participating in the capital increases ofother companies pursuant to the provision of article nO.27 of the CapitalMarket Law and article no.122 of its executive regulations, provided thatrequired legal procedures for amending the statute of the company will takeplace after completing the required legal procedures for the aforementionedcapital increase.Approval to change the Company's name to reflect its transformation into aninvestment holding company in the light of the aforementioned resolutions.The Extraordinary General Assembly of the Company was informed of theprevious decisions of the Ordinary General Assembly held on June 2, 2013,which approved the valuation of the fair values determined by theindependent financial advisor as well as the related party contracts.As the Ordinary General Assembly approved on June 2,2013 the conclusionof agreement to increase the Company's shares in some of its investees forthe following sectors:

EnergyTransportation and logistical supportAgriculture and food industriesCementOther sectors


85

51. Capital CommitmentsThe capital commitmentsas at December31, 2013 representedin the following:

1 370937417

1 35049991720437500Incentives to employees (shareholders)

Total

31112/2013LE

383 2326406665740

221 3744901000000005500000006239701016015 53510814502

Citadel Capital Partners Ltd.United GroupGrouped Holdings Ltd.Fenix One and Co Ltd.Benu One Ltd.Power Investments EuropeMamdouh Mohamed Fathy AbbasOthers

II

50-2 Shareholders' credit balancesSubsequent to the balance sheet date the value of the credit balances owedto the shareholders in consideration for the purehase of the abovementioned investments and for employees' (shareholders) incentives havebeen credited with an amount of LE 1 350 499 917 and LE 20 437 500respectively with a total amount of LE 1 370 937 417 against LE2323 160875 for the year ended December 31, 2013 (note 25) with a grossamount of LE 3 694 098 292.The amounts that were credited for shareholders subsequent to the balancesheet date are as folIows:

50. Subsequent Events50-1 Investments

Subsequent to December 31, 2013, the Company has purchased financialinvestments from shareholders of the Company through the Company andits 100% owned subsidiary, Citadel Capital for International InvestmentsLtd. for the purpose of increasing the Company's ownership sharepercentages in some investee companies. The value of the investmentspurchased during the subsequent period to the balance sheet date is LE1 344562412 against LE 2 167786600 during year 2013.

The General Assembly also agreed to grant management of the Company theauthority to determine the appropriate timing to enter into those agreements orto reject it and to allow the members of the board of directors to enter intorelated party agreement with respect to the sale of any shares they hold in thesecompanies. The Assembly further resolved to vest the Company's managementwith the rights to enter into similar agreements with the same shareholders orother shareholders in these companies as long as these agreements are with thesame basic terms and conditions previously referred to. The required proceduresare being carried out in this respect.


33041281

86318573363 187

689390

13 148777

4812916384415342364

3111212012LE

253016522731

2555855526643377

EGPEGPEGP

309075EGP309075

EGP

EGPEGPEGP

31112/2013LE

partNot completed part

currency

533797091

2526632331271123768878129264611492607236338

31/12/2012LE

476565600

218995

86

253016522731

25558555

Not completed Contract

2050150933500028401 505

2040000

17450750

289895020348048

581296

ASEC forMiningCompany(Ascom)Nilevalleygas companyUnionTrading and ElectricEngineeringoffice paving aroadMatcomengineeringconstruction&& tradingcompany

B Matcomengineeringconstruction& & tradingcompanyVeoliawater systemElject

Contractamount

Contractor

51.2 ASEC Minya Cement Company (formally Arab National CementCompany)

Euro 290018US dollar 25613 580US dollar 26 115044EGP 1292646DZD 1261349DZD 7942104

609778653

31/1212013LE

Euro 547023300

US dollar 240 612

302203683591375566912926461418840089337500

5700000034603

completed currencypart

Not completed part

FLSmidthDerunarkCompany 57 000 000SARLMHDA 12500000ASECforMiningCompany(Ascom) 763 160EnergyaCompany 23 699 815EnergyaCompany 9 015 848TCBCompany 2 909211CTCCompany 39 500 000CetimCompany 122850000

amount

51.1 Asec Algeria Cement Company (Asec Cement)Contractor Contract Not Contract


87

52.4 ASEC for Manufacturing and Industries projectCo. (ARESCO)

31/12/2013 31/12/2012

EURO US.$ LE EURO US.$ LELetters ofguarantee 8002533 926645 62471 634 13646922 I 398784 94244216

=====

2212349

------------72 079884

46978677

31/12/2012LE

I=======

1 122570

52.3 ASEC Environmental Protection Co.(ASENPRO)Letters of guarantee

====

5873028652.2 Arab Swiss Engineering Co. (ASEC)Letters of guarantee

3733686452.1 ASEC Automation Co. (ASA)Letters of guarantee

31/12/2013LE

52. Contingent liabilitiesThe contingent liabilities as at December 31, 2013 are represented in thefollowing:

5012822

31/12/2012LE

675000

3285000

370000

582472100350

Contractamount

Contractamount

31/12/2013LE

Workshop (1) 675000

Work shop (7) 3285000

Work shop (9) 370000

Northwall ofthe factory

Self-extinguishingsystemin the factory 100350

0 Legal consultancyfees 2400000

Total 6830350

51.3 ASEC for Manufacturing and Industries project Co. (ARESCO)


US.$

88

II

54. Comparative figuresCertain reclassification has been made to the comparative figures in order to conformto current year presentation.

53. Potential tax liabilitiesOn 22 April 2010, the Egyptian Tax Authority issued an executive seizure letterform (23) for the Arab Swiss Engineering Company "ASEC", a subsidiarycompany, against an outstanding corporate taxes balance of LE 72 491 234 for theyears 1978 to 2004. Accordingly Arab Swiss Engineering Company "ASEC"signed an agreement with tax Authority whereby it makes payments with anamount of LE 26 million till December 31, 2013 and accordingly the due balancetill December 31, 2013 amounted to LE 9 million based on form (9 A) seizure ofTax Authority.

United Foundries Company guaranteed Amreya Metal Company up to LE 2million in the favor of Egypt factors Company.

2384681 126

174239809211

EUROLE

31/12/2012

52.5 United Foundries Company

31/12/2013

LE EURO US.$

Letters ofguarantee(outstanding) 333264 146 100Letters ofguarantee (cover) 27329 19900

Letters of credit(outstanding) 3 136901Letters of credit(cover) 35613


~ Hazem Hassan Public Accountants & Consultants Consolidated ...

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Transcript of ~ Hazem Hassan Public Accountants & Consultants Consolidated ...