BRE Bank Securities

7 kwietnia 2005

Nazwa

BRE Bank Securities Research report - IPO 4 April 2005

Anica System

Information Technology Poland

Market cap (price = PLN 7.1)*

Comparative valuation DCF valuation PLN 7.8

PLN 6.3 PLN 47.0 mn

68.2%

Pocket Power We estimate the present value of Anica System stock, assuming a suc-cessful issue, at PLN 7.1. Anica has a strong base of clients using its system to support the work of trade representatives and knows how firms producing and distributing fast moving consumer goods operate in traditional business better than the competition. Its products pro-vide users with the information that could determine their position on the market. The growth in product sales will result in a substantial growth in Anica’s profits in the years ahead. Due to its unique client base, Anica could become a takeover target within several years.

Narrow specialisation Anica operates in the very narrow specialisation of mobile systems, mainly automating the work of trade representatives. The company’s offer has been addressed to producers and distributors of fast moving consumer goods (FMCG) operating in Poland. Anica has a strong position in its pre-sent area of activity due to possessing a client portfolio several times larger than its closest competitor, being the most experienced firm in Poland as well as to the high quality of services resulting from its narrow specialisa-tion. The high degree to which Anica’s activity is concentrated means that larger IT firms do not place great weight on competing in this area (it has little significance for them). Stable business, valuable clients The services rendered by Anica have an increasingly greater recurrent character, which means stability of the current business and a growth in average margins. Clients are mainly financially sound, large production firms, due to which there has not been a problem with overdue accounts receivable. Strong competition on the Polish FMCG market, on which Anica’s clients operate, means that the efficiency of the sales process in the entire distribution chain is an important factor in their success. Due to their large share in the FMCG market, Anica’s clients provide an excellent base for further growth. Issue for development, new products and home office The first goal of the issue is the development of existing products in order to automate data flow throughout the entire distribution chain, from the pro-ducer through the distributors to the stores. The company’s strong point here is the excellent opinion of current clients and the significant benefits for clients from installing new modules. The second goal is creating new prod-ucts, mainly software for pharmaceutical, financial and power distribution firms. Due to the similarity of needs of clients from sectors, to which new products will be directed, to the needs of firms from the FMCG sector, the introduction of new products is likely to be successful. The new home office will house the new employees necessary for company development as well as a larger data processing centre, necessary due to the growing demand for outsourcing services.

Shareholder Structure* votes shares

Sector Presentation Teleinfo estimated the value of the Polish IT market at PLN 16 bn in 2004. In relation to GDP, this is 1/3 lower than the average in the EU. This market is expected to grow more than 10 percent annually in the years ahead. The IT market is characterised by a large share of domestic firms and the relatively weak position of foreign firms (as opposed to the situation in Western Europe). According to BRE Bank securities, the current value of Mobile systems sold in Poland for FMCG, i.e. the por-tion of the IT market on which Anica’s activity is fo-cused, is estimated at several dozen million PLN annu-ally. Anica’s competitors are mainly the significantly larger Comarch and firms the same size or smaller than Anica. Foreign providers are virtually absent on the Polish market of SFA systems for FMCG firms due to the structure of retail trade in Poland differing from that in developed countries. Poland has a large share of traditional, small and medium-sized stores. Foreign systems are not adapted to work on such a market.

Company Profile

Anica is the largest provider on the Polish market of systems supporting sales force automation (SFA) of FMCG firms, both producers and distributors. These systems are based on software developed by Anica, specifically for servicing traditional sales. A large por-tion of activity involves the outsourcing of SFA systems and systems automating the flow of information in the producer-distributor-store chain as well as analysing sales data. Anica also sells computer hardware and builds terminal systems.

Witold Samborski (48 22) 697 47 36 Witold.Samborski@breinwest.com.pl

BRE Bank Securities does not rule out offering brokerage services to an issuer of securities being the subject of a recommendation. Information concerning a conflict of interest arising in connection with issuing a recommendation (should such a conflict exist) is located on the final page of this report.

(PLN mn) 2003 2004 2005F 2006F 2007F Revenues 20.94 23.24 25.70 30.50 35.00 EBITDA 3.73 3.94 4.63 5.95 7.35 EBITDA margins 17.8% 17.0% 18.0% 19.5% 21.0% EBIT 2.72 2.66 2.83 3.75 4.75 Net profit 2.05 2.22 2.49 3.20 3.88 Cash earnings 3.06 3.50 4.29 5.40 6.48 Price = PLN 7.1 P/E 15.6 14.4 18.9 14.7 12.1 P/CE 10.5 9.1 10.9 8.7 7.2 P/BV 3.8 3.0 1.9 1.7 1.7 EV/EBITDA 8.0 7.6 8.2 7.0 5.9

Wojciech Barczentewicz 6.1% Piotr Masłowski 6.1% Maria Rzezińska 4.5% Grzegorz Macionżek 4.2% Other shareholders 10.5% New shareholders 68.6%

15.7% 15.6% 11.5% 10.7% 11.4% 35.1%

Important Dates 11.04 - establishment of price range 12-20.04 book building 20.04 - establishment of issue/ sales price

Free float*

*following issue of 2.1 mn new shares

www.brebrokers.com.pl

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Valuation of Anica System Summary of valuations We estimate the present value of Anica System stock at PLN 7.1, assuming a successful issue of 1.835 mn shares for PLN 6 each (which means including a discount in relation to the valuation typical for an initial public offering) as well as the realisation of the incentive programme, with an issue of 0.27 mn shares (of which 90,000 for PLN 2 each in the employee tranche, and the remainder for PLN 0.20 per share within the course of the next 3 years). The DCF model valuates the company’s stock at PLN 7.8. Comparing the P/E, EV/EBITDA and EV/EBIT ratios for Anica with the ratios for Polish and foreign IT firms valuates the company’s stock at PLN 6.3 assuming a 15% discount due to Anica’s size in relation to the publicly traded companies used in comparisons.

DCF Valuation DCF model of valuation for Anica shares

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 revenues 25.7 30.5 35.0 40.2 44.2 48.6 53.5 58.8 64.7 71.2 dynamic 11% 19% 15% 15% 10% 10% 10% 10% 10% 10% EBIT margin 11.0% 12.3% 13.6% 13.5% 14.2% 14.8% 15.4% 15.9% 16.4% 16.8% EBIT 2.8 3.7 4.8 5.4 6.3 7.2 8.2 9.3 10.6 11.9 tax rate 21% 21% 21% 21% 21% 21% 21% 21% 21% 21% taxes 0.6 0.8 1.0 1.2 1.3 1.5 1.8 2.0 2.3 2.6 NOPLAT 2.2 2.9 3.7 4.3 4.9 5.7 6.5 7.3 8.3 9.4 amortization 1.8 2.2 2.6 3.0 3.0 3.0 3.0 3.0 3.0 3.0 investments in fixed assets and intangible fixed assets 5.5 7.5 3.0 3.0 3.0 3.0 3.0 3.0 3.0 3.0 change in working capital 3.22 1.59 1.73 1.20 0.94 1.03 1.13 1.25 1.37 1.51 FCF -4.7 -3.9 1.6 3.1 4.0 4.6 5.3 6.1 6.9 7.9 risk free rate 6.0% 6.0% 6.0% 6.0% 6.0% 6.0% 6.0% 6.0% 6.0% 5.6% risk premium 5.0% 5.0% 5.0% 5.0% 5.0% 5.0% 5.0% 5.0% 5.0% 5.0% beta 1.2 1.2 1.2 1.2 1.2 1.2 1.2 1.2 1.2 1.2 cost of equity 12.0% 12.0% 12.0% 12.0% 12.0% 12.0% 12.0% 12.0% 12.0% 11.6% debt / EV 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% WACC 12.0% 12.0% 12.0% 12.0% 12.0% 12.0% 12.0% 12.0% 12.0% 11.6% discount factor 1.1 1.2 1.4 1.5 1.7 1.9 2.1 2.4 2.7 3.0 DCF -4.3 -3.2 1.2 2.0 2.3 2.4 2.5 2.5 2.6 2.6 DCF total 8.0

growth rate of cash flow after 2013 2% terminal value 82.0 discounted terminal value 30.4 goodwill 38.4 net debt after issue of 2.1 mn shares -13.5

value of capital 51.9 number of shares (mn) 6.6 DCF valuation of 1 share (PLN) 7.8

Source: BRE Bank Securities

Valuation PLN 7.1: DCF PLN 7.8, Comparative PLN 6.3

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Susceptibility of Anica’s DCF valuation to a change in assumptions regarding the growth rate of free cash flow and cost of equity (PLN per share)

Source: BRE Bank Securities

Comparative Valuation For valuating Anica stock by a comparison with publicly traded companies, we used two groups of IT firms: Polish companies, for which BRE Bank Securities has its own forecasts for 2005 and 2006, as well as foreign companies, in the case of which we used average forecasts collected by IBES (from Bloomberg) to calculate ratios. We employed ratios for 2005 and 2006, assuming that investors are significantly more interested in the future results of companies, in whose shares they are investing, than in historic results. Polish IT companies, used for the comparisons, should note a significant improvement in results within the next 2 years, a manifestation of which is our forecast of a decline in their valuation ratios. Moreover, the ratios of European IT firms forecast by financial institutions contributing the data for the comparisons prepared by IBES will fall within the next two years, the result of an improvement in their results. In accordance with our forecasts, Anica’s results will also be significantly better in 2005 and 2006 than those achieved in 2004. We employed a 15% discount in the valuation, justified by the considerably smaller size of Anica in relation to the firms used for comparisons. Anica is an order of magnitude smaller than the Polish companies used for comparisons, and the European companies are even bigger. The average valuation of 1 Anica share by a comparison with Polish companies (with a 15% discount) is PLN 6.3. The comparison with foreign companies, employing a 15% discount, also gives a figure of PLN 6.3 as the estimate of the value of 1 Anica share.

Polish IT firms used for comparisons EV/EBITDA EV/EBIT P/E 2005 2006 2005 2006 2005 2006 Softbank 10.6 7.6 13.1 9.1 14.2 10.8 Comarch 9.9 8.3 14.0 11.2 16.4 13.2 Emax 8.4 7.8 10.0 9.2 15.3 14.5 Prokom 10.0 8.5 11.6 9.8 13.8 12.0 median 9.9 8.0 12.4 9.5 14.7 12.6 resultant price of Anica stock w/o discount (PLN) 9.0 9.2 7.3 7.4 5.5 6.1 resultant price of Anica stock w/ 15% discount (PLN) 7.6 7.8 6.2 6.3 4.7 5.2

Source: BRE Bank Securities

0% 1% 2% 3% 4%

9.0% 8.1 8.8 9.5 10.6 12.1 10.0% 7.7 8.1 8.8 9.5 10.6 10.5% 7.4 7.9 8.4 9.1 10.0 11.0% 7.3 7.7 8.1 8.8 9.5 11.6% 7.0 7.4 7.8 8.4 9.0 12.0% 6.9 7.3 7.7 8.1 8.8 13.0% 6.6 6.9 7.3 7.7 8.1

15% discount in relation to larger IT firms

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European IT firms used for comparisons

EV/EBITDA EV/EBIT P/E 2005 2006 2005 2006 2005 2006 LogicaCMG 8.9 7.9 11.0 9.8 17.7 14.9 Cap Gemini 8.1 6.4 15.0 10.2 34.9 19.4 Tieto Enator 8.7 8.0 13.9 12.5 19.6 16.5 IDS Scheer 10.2 8.3 12.9 10.1 21.4 17.2 Atos Origin 7.4 6.6 9.6 8.5 18.6 15.6 Getronics 5.9 5.1 10.6 8.3 17.6 12.7 EDB 6.5 6.1 12.9 11.0 18.7 14.8 Ementor 7.0 4.0 7.9 4.1 45.8 12.1 median 7.8 6.5 12.0 9.9 19.2 15.2 resultant price of Anica stock w/o discount (PLN) 7.5 7.9 7.2 7.6 7.2 7.4 resultant price of Anica stock w/ 15% discount (PLN) 6.4 6.7 6.1 6.5 6.1 6.3

Source: BRE Bank Securities, Bloomberg/IBES

Forecasts Sales In 2005, we expect Anica’s sales to grow at a similar rate as during the previous two years (11%), but with a further clear shift in the structure toward a greater share of proprietary products. The share of Anica’s proprietary products in sales increased in recent years from 28% in 2001 to 47% in 2004. In 2005, the company will continue to offer existing products and the growth in sales will be driven mainly by obtaining new clients for existing products as well as by sales of new products to current company clients. These products are already in the company’s offer of software modules automating data flow in the distribution chain. The relatively small growth in Anica’s total sales in 2005 will mainly result from the expected slower growth in sales of goods and materials. This area of Anica’s activity is not treated as a core area of development. In 2005, we expect sales of terminal systems to public utility companies and banks as well as sales of hardware to remain on the level noted in 2004. As a result of focusing development on Anica’s products (software and services), the structure of sales will shift in the near future toward a greater share of high-margin proprietary products. We estimate the growth rate of the most valuable portion of Anica’s activity - sales of products – in 2005 at 28%, similar as in 2003 and 2004 (31% and 28%, respectively). Our forecasts include an almost equally high growth in product sales in 2006 (27%) and somewhat slower growth in 2007 (20%). Following this period, our forecast of total sales growth falls to 10% annually, or a rate similar to the likely long-term growth rate of the Polish IT market and assumes a stable structure of sales, with a 60% share of proprietary products. Structure of sales PLN mn 2002 2003 2004 2005F 2006F 2007F Sales 18.9 20.9 23.2 25.7 30.5 35.0 products 6.5 8.5 10.8 13.8 17.5 21.0 goods and materials 12.4 12.5 12.4 11.9 13.0 14.0

Source: 2003-4 Company, 2005-7 forecasts of BRE Bank Securities In our opinion, the rapid growth of products in 2005 will largely depend on the company’s ability to obtain large orders for new installations of the Sales Force Automation system: EBI Producer and EBI Distributor. Many of the largest producers of fast moving consumer goods already have SFA systems, as do many FMCG distributors. The company is targeting its offer to smaller producers and distributors that are, however, large enough that they also require a system adapted to their individual needs. The degree of labour intensity is similar as in the case of large installations (with the exception of a shorter period of time required to train a small number of users), but revenues are smaller. The company’s installation teams are comprised of trained specialists; therefore the building of additional modules is time consuming. However, Anica’s SFA systems have excellent references and are the first choice among FMCG producers and distributors, becoming the gradual sector standard in Poland. An important factor in evaluating Anica’s prospects for developing sales of its own products is

Increasingly more products in total sales

EBI is the standard of the FMCG sector

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the growing share of revenues with a recurrent character, resulting from licensing contracts (in which the client pays for the software license in fixed instalments throughout the period of use) or outsourcing contracts (when the entire hardware infrastructure is supplied by Anica in exchange for regular payments for a predefined period of time). The share of recurrent revenues in sales of company products is steadily growing and in 2004 reached 50%. The reason for the growth in the share of recurrent revenues is the growing conviction among clients of the value Anica delivers in the form of outsourcing services, the inclination of FMCG firms to shed those activities that are not their main specialty and the possibility of limiting initial investment expenditures. A large portion of clients from the FMCG sector comprises entities controlled by global leaders in this sector, for which outsourcing IT services is standard procedure. The growth in the share of recurrent revenues in total sales has a huge significance for Anica by stabilising its situation, similar to the role long-term contracts for the installation of sophisticated systems plays for leading Polish firms engaged in IT system integrations. A factor increasing sales of Anica’s main product (SFA systems) in coming years should also be the introduction of the EBI product Vanseller, a variation of the EBI product designed for representatives of distributors travelling by van from client to client taking on-site orders (vansellers). Anica will compete on this market with established providers, the products of which have been used by networks of vansellers for some time. Some currently used systems need to be replaced. A second important source of sales growth to clients from the FMCG sector is sales to current SFA system users of other modules automating the flow of information in the distribution chain (EBI: Knowledge, Connector and Enterprise). Anica has just completed the first installations of these modules; therefore we do not expect them to make a significant contribution to sales before 2006. However, in subsequent years, these modules and the services connected with them should be a main force driving Anica’s future sales growth. The version of the EBI Producer software designated for pharmaceutical manufacturers has recently been incorporated into the company’s offer, as a result of which Anica is now beginning to obtain contracts. Margins The main assumption regarding margins is an increase in average EBITDA margins obtained by Anica from 17% in 2004 to 21% in 2007 and subsequent years of the forecast period. In our opinion, the source of the higher average margins will be the growing share of company products in sales. We assume that the gross margin on sales of products alone will slip slightly, while the gross margin on sales of goods will remain stable. We also assume that, beginning in 2005, the company will bear the costs of unpaid accounts receivable corresponding to 0.5% of sales, as a result of the increase in sales to clients other than the largest producers of consumer goods, which means a growth in the number of clients and sales to clients the financial situation of which is more difficult to assess. Anica’s relatively substantial investments will result in increased amortisation over the next several years to around PLN 3 mn annually. Investments Anica’s investments planned for the next 2 years include building a new home office with a larger data processing centre (PLN 5.4 mn in 2005 and 2006), the development of current and new products (PLN 4.5 mn), investments in the expansion of export sales (PLN 1 mn), the establishment of subsequent offices outside Lublin but in Poland (PLN 1 mn) as well as the purchase of infrastructure for the realization of license-based software sales (PLN 1.5 mn). For purposes of simplification, we assume that following the current investment cycle to the end of the forecast period, Anica will not need to increase investments above replacement level. However, the experience of many IT firms shows that in a growing market the need for greater investments could appear. Dividend Anica has stated it will not pay a dividend for 2004 and probably not for 2005, but later dividend payments are possible if they do not interfere with the company’s development needs. According to our estimates, Anica should be in a position to designate as much as all of net profit for a dividend beginning with the dividend for 2006.

Stable revenues from licensing and outsourcing contracts – half of product sales

Increased sales of modules automating data exchange beginning in 2006

Growth in average margins due to greater share of products

Investments mainly in products and new home office

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Market Position and Strategy of Anica System

We have not divided Anica’s activities into segments. Margins obtained on hardware contracts and for building terminal systems are significantly lower than margins on the sale of proprietary software and services related to it. We are interested in how Anica generates profits, and profits are mainly generated in that portion of activity involving sales force automation. In the future, Anica’s profits will also originate to a considerable degree from the sale of products automating the flow of information in the distribution chain.

Competitive Position of Anica

Products The most important part of Anica’s activity is the sale of proprietary Sales Force Automation software, supporting the trade representatives of producers and distributors, as well as services connected with this software: installation, training, maintenance, technical assistance, upgrading, etc. Anica’s SFA systems bear the names EBI Producer and EBI Distributor, depending on designation. EBI Producer is comprised of a central application, serving a management function, and of an application installed on the portable computer of the trade representative (a palmtop with GPRS Internet access), used by the trade rep for entering data as well as for two-way communications with the home office. This system makes it possible for the trade rep to enter order data, avoiding paper documentation, immediately after receiving it from the store. This means shortening the time from receiving the order to delivery (the store shelf is empty for a shorter period of time), reducing the likelihood of error in placing the order (as it is entered into the system only once) and shortening the time the trade representative devotes to administrative activities (with more time devoted to productive activity). The system allows the trade representative to quickly transfer information about the market situation, including product prices, the effectiveness of advertising and promotional activity as well as activities of the competition, to the home office. Representatives have access to current data concerning terms of sales (rebates, etc.), a given client’s account and the level of sales to this client. This improves the quality of the trade representative’s work. The home office obtains rapid access to trade and market data, is able to analyse the market situation with limited delay and create a database of clients and competitors. These data are available to the home office immediately following a service call to a store, rather than at the end of the day at the earliest when the rep enters the data collected during the entire day into the system. This system also allows the home office to plan the activities of the trade representatives, pass on instructions concerning cursory market surveys, and monitor their work. The EBI Producer system is able to exchange data with systems supporting the firm’s management, such as the financial-accounting system. EBI Distributor works in a similar fashion as that described above, automating the work of a distributor’s trade representatives and providing the wholesaler similar benefits as the EBI Producer system provides producers. EBI Vanseller is a version of the SFA system designated for seller-suppliers, the trade representatives of the distributor visiting stores in delivery vehicles and filling order on site. According to Anica, the company’s system is a more modern solution than the products already established on the market and better adapted to the specific needs of vansellers visiting stores of various sizes, including very small stores. Among others, it contains a device that prints both invoices and receipts, which greatly facilitates the work of a trade rep. Anica’s systems for analysing sales data and automating the flow of sales information between stores, distributors and the producer compliment SFA systems designated for producers and distributors. EBI Knowledge is used for analysing data supplied by EBI Producer and arranging these data into a form that facilitates the decision-making process. This makes it easier for the producer to recognise sales trends, evaluate a product’s chances for market success and the reasons for these phenomena. The expanded version of EBI Knowledge makes it possible to analyse data originating from EBI Enterprise. EBI Connector is a communications platform making it possible to exchange data between trade partners, to establish mutual data for identifying goods (there are frequently thousands of coding systems) originating from the IT systems of various firms, to automatically send orders taken by the trade reps of the producer and to confirm that these orders are filled by the

EBI Producer – rapid data flow from producers’ trade reps

EBI Distributor – for distributors’ trade reps

EBI Vanseller – for van-based trade reps

EBI Knowledge – supports the decision-making process

EBI Connector – data exchange between producer and distributor

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distributor. The benefit for the producer is knowing the fill rate of orders taken by a given trade representative. The benefit for the distributor is the successive inflow of orders during the day from stores visited by a producer’s representative, which makes it possible to load delivery vehicles faster than with a system in which order data only reaches the distributor in the evening, after the trade representatives enter their data into the producer’s IT system. EBI Enterprise provides a producer access to trade data of the distributors of its products as well as to information about inventory levels of its distributors. This solution allows the producer to monitor product flow through the entire distribution chain. For the distributor, the sharing of sales data with the producer could be a source of additional income. EBI Retail, currently being installed for the first client, is a system automating data flow between the store and the distributor and producer. Among others, this system can be used for electronically placing orders with the distributor at any time (i.e., orders resulting from items being out of stock or almost sold out, and not from a visit by a trade rep). As a result of this system, the distributor obtains orders quickly and electronically (lower administrative costs, fewer errors, more time for filling orders) and rapid access to information on the situation in the store (obtained on a continual basis and not only when a trade rep visits). The benefits for the store include keeping shelved stocked, faster order turnaround and additional income from selling the information to the distributor and producer. Anica’s products from the EBI group are specially adapted for servicing traditional trade. Approximately half of FMCG sales in Poland occur through traditional channels of distribution (i.e., in small and medium-size stores, supplied by distributors). Anica’s products cover all links in the distribution chain and are mutually compatible, which distinguishes them from competitive, piecemeal solutions. A distinguishing feature of Anica’s offer is also providing core products on various terms: selling software for a one-time payment, selling software licenses (the client pays a fixed amount each month the software is used) and outsourcing, when Anica takes on the obligations connected with ensuring the hardware and system for the software, and the client pays a fixed monthly fee for using the system, operating on computers owned and administered by Anica. Rendering outsourcing services is possible due to financial resources allowing the company to invest in a data processing centre and in its own IT infrastructure.

EBI Enterprise – producer sees product flow to store shelves

EBI Retail – order and data flow from the store to the distributor

EBI – specially designed for traditional trade

EBI available through purchase, licensing and outsourcing

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Who is Stronger: The Producer or the Distributor? Anica provides its products and services mainly to firms from the FMCG market. As long as the offer contained SFA products, designated specifically for the producer or for the distributor, only obtaining a positive decision from the client was necessary. The installation of products such as Connector and Enterprise is connected with the necessity of working on the producer-distributor level. Therefore, the answer to the questions which is the stronger party in such a relationship and which of the parties will have the final word in decisions about the installation of a jointly used product becomes important for Anica. The answer is not unequivocal. The simple principle is that the stronger party is the one closer to the source of cash (i.e., the consumer), which in the producer-distributor relationship would point to the distributor. However, a large producer, the owner of leading brands, has such large share in the sales of individual stores that it would be difficult for the distributor to resign from cooperation with it (the risk would involve another distributor providing these important products servicing the store). Relative to distributors, smaller producers have a significantly weaker position. In turn, the large distributor (particularly from the group of several national distributors) has such a large share in the sales of even the largest producer that resigning from its services would be very risky for the producer (before other distributors would reach stores with the goods previously supplied by the distributor with which cooperation was terminated, sales would fall dramatically and shelf space would be taken over by products of the competition). Therefore, neither the producer nor the distributor is in a position to dictate terms on the market of traditional sales. The largest producers and the largest distributors have the strongest position, and the rapidly occurring consolidation of distributors is increasing their strength. A product such as EBI Enterprise, giving the producer access to the sales data of the distributor (previously a strong point in relations with a producer), strengthens the position of the producer relative to the distributor. Basically, the distributor does not want to tell the producer in which stores its products sell best and in which they sell the worst, or how a given store should be serviced. With this knowledge, the producer could change distributors without bearing losses resulting from a temporary loss in access to stores previously serviced by the distributor. The producer is prepared to pay the distributor for access to this data, which is an incentive for distributors to accept such a solution. For the producer, this information provides a picture of the effectiveness of its own sales force as well as advertising and promotional activities. Obtaining clients for EBI Enterprise requires Anica cooperate with large producers, which could persuade distributors to participate in such an exchange of data. The situation on the distributor-store level is similar. The position of the store is basically stronger than that of the distributor. However, the consolidation of distributors results in the importance of an individual store diminishing. The store still has a choice among many distributors, but its position is weaker as a large distributor does not have to sell to it. The reaction of small stores to the consolidation of wholesalers and to the expansion of supermarket chains is to organize into buyer groups. These groups have increasingly stronger position in negotiations with distributors and producers. On the distributor-store level, the influence of using EBI Retail, a product automating the flow of orders and information from small stores to wholesalers is similar to that described above on the producer-distributor level: EBI Retail may provide information concerning the details of transactions in the store, previously unavailable to the wholesaler, which somewhat weakens the position of the store. Therefore, the distributor, deriving benefits from rapid and inexpensive access to information about what is happening in the store, is prepared to pay the store for access to this information. As a result, a method for installing the EBI Retail system could be persuading a distributor that wants to establish stronger ties to a chain of stores cooperating with it, to buy the system. Therefore, in regard to the distribution of negotiating strength between clients, the situation in traditional sales is more complicated for providers of solutions automating the flow of information than in modern sales, where large retail chains are able to impose their terms on even the largest producers. Thus, providers of solutions being the equivalent of EBI Connector can simply, as Comarch successively does, sell or give their software to the largest retail chains, which are able to persuade all providers to use it.

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Evaluation of Market Attractiveness Size According to our estimates, the Polish market of SFA systems and systems for managing the distribution chain for the FMCG sector has an annual value of several dozen million zlotys. We based this estimate on Anica’s sales data in the SFA segment (more than 10 million zlotys annually) and on information from the company concerning the scale of its activity in comparison with the activity of its main competitors. In evaluating this size, it is important to keep in mind that the market of systems and services automating the flow of data between distributors and producers is in a very early stage of development, and that the market of systems and services automating the flow of data between small and medium-size stores and the distributors and producers of fast moving consumer goods is virtually non-existent. Anica estimates that the market of automated data flow between stores, distributors and producers is similar in size to the market of SFA systems alone. Growth rate We do not have outside data concerning the growth rate of the SFA market and the automation of the distribution chain. On the one hand, the market of FMCG products is saturated and competition between producers is very fierce, which means that the motivation of producers to own the tools improving the efficiency of one of the most important processes in a firm – sales – should be strong. Competition between distributors of fast moving consumer goods is equally strong. On the other hand, many of the largest producers and distributors already have SFA systems, which means that they pay only fixed fees for servicing and upgrading them. The declining share of traditional trade in total retail sales in Poland suggests that the existing networks of trade representatives will probably not be expanded. Therefore in summary, we believe that it is unlikely that the growth in the SFA market alone would be faster than the growth in the entire Polish IT market (some 10% annually in the long-term). However, the market of distribution chain automation is and probably will be in the years ahead an area of stronger growth. Clients The clients of Anica’s products are sound companies. The company has several hundred clients if all potential users are considered. Clients include large international and domestic producers as well as medium-size domestic producers. FMCG distributor clients include several large firms, approximately 100 regional and some 6000 local firms (GfK Polonia data). Anica does not yet offer a product for the latter group of the smallest distributors. Structure of competition We believe the structure of competition on the market of SFA systems is very favourable for Anica. The most important competitor is the substantially larger Comarch. However, this firm is focusing on dominating the market of trade data transmission between chains of large stores and their suppliers, mainly the producers themselves. This is an area currently outside the field of Anica’s core activity (traditional trade). According to Anica, this area of Comarch’s business is not treated as a priority area of development, probably due to the limited influence it exerts on Comarch’s results. Despite this, Comarch has approximately 10 installations of the ECOD Agent system (the equivalent of EBI Producer) under its belt. The world’s largest providers of SFA and CRM systems offer products that are not adapted to the Polish model of trade, and the size of the Polish market of SFA systems is a disincentive for them to enter the market. Other than Comarch, the following Polish companies comprise serious competition for Anica: Sagra (offering the references of 9 producers and 19 distributors), Eurosoft, Apsys (21 installations, including 2 producers), and Glen (6 installations for 450 representatives, largest installation for 150 representatives). The competition also includes Polish IT firms smaller than Anica, with 1-3 installations completed. According to the company, these firms do not have the human or financial resources necessary in order to seriously compete with Anica. None of the smaller Polish firms (according to Anica information) have their own data processing centre, making it possible to render outsourcing services. In the transmission of trade documents (EBI Connector) Anica’s main competitors are Comarch, with a very strong positions in the segment of modern trade, and Infinite, the company owned by WSE-listed Eldorado. Comarch is also Anica’s main competitor in the production of software for collecting the data of distributors by a producer (EBI Enterprise). Many firms in Poland are engaged in building databanks, such as EBI Knowledge, including all the major system integrators. Anica’s

SFA – 10’s of millions of zlotys annually, data flow – twice as much

Automation of distribution chain – growth faster than SFA

Clients – large producers and distributors are the most important

Competitors include Comarch and small Polish firms

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BRE Bank Securities

advantage in relation to both of the mentioned categories of products is the base of clients, among which are many of the largest FMCG producers and distributors. This means that Anica possesses knowledge concerning those clients, their methods of coding goods, principles of granting rebates and other unique methods of activity that is unavailable to other providers. New players The specific nature of the Polish market, with very dispersed retail sales and dispersed sales on the wholesale level, is an entrance barrier for large foreign providers of SFA and CRM systems. For Polish firms, entrance barriers include the lack of references and experience in the realisation of major SFA projects. Prices Prices on this market are stable, despite the continual decline in prices of computer hardware, being an important component of costs (the lifespan of a palmtop is short). The reason for this is producers discontinuing palmtop models, the prices of which are continually falling, and the introduction of new palmtops with a similar price and greater capabilities. In summary, the market of SFA systems and automation of the distribution chain is a small part of the IT market, but an attractive segment due to the relatively low degree of competition and very attractive clients. An important feature of this market is its growth potential with respect to automating data exchange between entities participating in the distribution chain. Evaluation of Anica’s strengths in relation to the competition Anica has the advantage of being first on the Polish market of SFA systems and having the largest share on it. Among the approximately 50 current users of Anica’s EBI systems are the largest producers of fast moving consumer goods (Avon, Beiersdorf, Cadbury Wedel, Henkel, Lubella, Maspex, Morliny, Nestle, Pernod Ricard, Seagram, Unilever) and major distributors (BOS, DLS, DTS). Connected with this is Anica’s knowledge concerning the way in which FMCG firms operate. Having an efficient sales-installation structure (the teams interact with the client from the first meeting to completion of the installation) and a model of sales, based on demo-tests, or free trial installations, are company strengthens. Anica’s strength in relation to smaller Polish firms is its healthy financial condition, allowing products to be offered on the basis of outsourcing (which requires investments in hardware and system software). In relation to Comarch, Anica’s financial resources are obviously limited, but sufficient to compete in segments falling within Anica’s area of interest. Clients positively perceive Anica as a provider rendering not so inexpensive, but high quality services. Finally, personnel costs, an important component of costs for every IT firm, are according to the company significantly lower in Lublin than in Warsaw or Kraków. Lublin is a major academic centre, graduating some 200 IT specialists every year. In our opinion, another Anica strong point is the management board, focused on activity in a narrowly defined area and conducting a cautious policy of safe, organic development. Cost effectiveness The scale of Anica’s activity in the SFA segment is significant in comparison with the majority of competitors currently operating on the market. With approximately 5400 active users of mobile systems, Anica is able to ensure a very high level of technical assistance and organise efficient equipment servicing. Having the experience of installing the largest number of SFA systems in Poland translates into fewer mistakes with subsequent projects, and therefore lower installation costs and costs of maintaining the system. Experience also means that installation procedures have been tried and tested, due to which rapid installations are possible (training up to 50 people per week). Anica’s personnel costs are lower than or similar to those borne by the majority of competitors. The company has not released detailed data, but it must meet the high requirements of FMCG producers regarding the quality of services and monitoring the quality of technical assistance (e.g., measuring the time it takes to answer the telephone, the average time it takes to render advice). Such an understanding of service quality from Anica’s point of view means cost effective client servicing. In summary, we believe that Anica could have a certain cost advantage over the competition.

Unrivalled FMCG client base, experience, knowledge about traditional sales

Large scale of activity, well-tested procedures – short installation period

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BRE Bank Securities

Anica’s competitive position: existing products Providers Weak: inexpensive local employees Clients Strong: large producers and distributors Substitutes Weak: forms filled out by trade representatives, orders submitted by

phone or fax Regulations Neutral: area almost unregulated Competitors Diversified: strong Comarch; weak smaller Polish firms; weak, as foreign

providers are more expensive and not adapted for servicing traditional trade

New players Currently few, significant entrance barriers – lack of knowledge on how main players on Polish FMCG market operate

Degree of competition Moderate Source: BRE Bank Securities Major changes in the company’s environment In our opinion, the most important change in the environment is the change occurring in the structure of Polish retail trade, with the role of modern trade (hypermarkets, supermarkets and discount stores) growing at the expense of traditional trade (small and medium-size stores). Simultaneously, the FMCG wholesale trade is undergoing rapid consolidation. The share of modern trade in retail trade already amounts to as much as 50% in some product categories, and overall is in the area of 40% (GfK Polonia data, cited by PricewaterhouseCoopers). According to forecasts from this same source, the share of modern trade in the retail trade of fast moving consumer goods will grow to 50% in 5-7 years and stabilise on this level. This means that traditional trade will probably remain an important channel for distributing fast moving consumer goods, and the networks of trade representatives will not disappear within the next 10 years. The consolidation of the FMCG wholesale trade means the establishment of entities with such a large share in the sales of individual producers that their position relative to these producers is becoming very strong. Those large distributors have considerable networks of trade representatives and the resources for financing purchases of systems increasing the efficiency of their work. The significance of single-store owners entering into agreements aimed at making group purchases and therefore negotiating equally good sales terms as those obtained by modern chain stores is more complicated for Anica. Small store owners so organised actually obtain strong negotiating positions with producers. However, in order to reap all possible benefits from the providers, they must be able to propose uniform principles of cooperation in the entire group, shelve positioning, etc. This requires standardising the IT systems in the stores, and at least verifying that they are compatible. This is an opportunity for Anica to increase sales. The company offers the product EBI Retail, designated for stores that want to automate communications with the distributor.

FMCG sales – increasing role of large stores, consolidation of distribution, cooperation among small stores

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BRE Bank Securities

Strategy

Method of competing Anica’s products and services are somewhat more expensive than those offered by its Polish competitors. The reasons clients chose Anica’s services are its reputation as a provider verified by the most demanding clients, product quality and flexibility in meeting client expectations. However, in comparison with foreign SFA system providers, Anica offers Polish clients a product much better adapted to client needs for a lower price. Method of maintaining competitive advantage Anica’s current competitive advantage could gradually be lost as competitors gain experience in the realisation of successive projects. The methods employed by the company to maintain its advantage for as long as possible are: attention to service quality, maintaining its reputation, investing in the development of products so that they remain among the best on the market, creating conditions for stable employment, maintaining the quality of the project teams and preventing the outflow of information to the competition. Areas and methods of development The development strategy of Anica includes both obtaining new clients for existing products and the development of new products. The company plans to expand into new markets, including foreign markets.

Further penetration of SFA market for FMCG The first goal described as long-term by the company is to maintain its position as leader on the market of SFA systems in Poland. Anica wants to sell its current products to new clients. Simultaneously, these products are to be developed by: 1. Developing products that complement the current offer of SFA systems, making it possible

to render new types of services, as well as

FMCG Clients

Pharmaceutical Energy

Foreign FMCG Sectors

Finance

EBI producent dystrybutor

EBI connector enterprise knowledge retail

New products

1998 - 2005 2005 - 2006

2005 - 2006 2006 - 2007

prod

uct p

enet

ratio

n

market penetrationother

Product penetration within FMCG

Good development prospects on new

markets

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BRE Bank Securities

2. Standardising products, making faster and less expensive installations of a simplified version of a product possible (due to which they would also be attractive to smaller clients).

Other than organic development inside the company, these plans are to be met through acquisitions of small, programming firms or purchasing the rights to their solutions if this would shorten the cycle of bringing new products online. The company estimates the potential of the FMCG market for EBI Producer software at approximately 20,000 trade representatives, working for 700-900 FMCG producers. Anica and other providers currently service about half of these representatives (BRE Bank Securities estimate), the majority of whom are working for large producers. According to Anica, the number of trade representatives of FMCG distributors is 2,000-3,000. The number of vansellers (delivering goods store to store by delivery vehicle) is estimated by the company at 2,500-3,000. Anica addresses its products to the approximately 25,000 FMCG trade representatives, while the current number of users of the company’s systems is approximately 5,400. We cite these figures as an indication of the large potential the company has to sell currently existing products to new clients. Product standardisation should allow Anica to also create an offer for smaller producers and distributors, for whom Anica’s current solutions are too expensive. We have no concerns regarding this first area of development, other than the acquisition of outside resources, which carries a risk typical for all takeovers – the risk of having the work of both engaged entities (the acquiring and the acquired company) being disrupted. New markets: pharmaceutical, finance, energy, FMCG in Russia and Ukraine The second area of Anica’s development is to be obtaining new sales markets for current products. Plans include creating versions of SFA systems for producers and distributors of pharmaceuticals, insurance companies, banks and energy distributors. More of Anica’s products designated for the FMCG market are to be directed to foreign markets, particularly to Russia and Ukraine. The pharmaceutical market could turn out to be a very good choice as a new area of development. According to the company, approximately 300 producers currently operate on this market, each with a network of several dozen to several hundred representatives, which corresponds to 20,000 trade representatives. Moreover, distributor representatives total some 1,500-2,000. Automating the work of representatives of pharmaceutical manufacturers whose products are sold over the counter is fairly simple for Anica as their work varies little from the work of the trade representatives of FMCG producers (rather than store, they visit pharmacies). Medical representatives (visiting physicians) have other responsibilities: the purpose of their visits is to convince physicians to prescribe the medicines of the manufacturer who they represent. Despite the differing character of their responsibilities, medical reps (and particularly their employers) could also reap many benefits from using a mobile system. The work of medical representatives is an important component of costs for pharmaceutical firms, and the effectiveness of their work could be limited if this work is not analysed and adjusted (e.g., too much time could be spent visiting physicians who almost never prescribe a given medicine, and too little time with physicians making a large contribution to a reps sales). Data concerning the medical market and the effectiveness of the sales forces of pharmaceutical firms have been researched in detail by IMS Health for 50 years. This firm is now present in 100 countries. Anica’s entry into this area means direct competition with IMS, which is a powerful opponent with an almost monopolistic position on the Polish market of information concerning the pharmaceutical market. For this reason, introducing software on the market for firms manufacturing prescription drugs is, in our opinion, a fairly risky venture. Other than IMS Health, Anica will also compete with Polish and foreign providers of SFA systems designated for the pharmaceutical market. Anica’s first client of the EBI Producer product for the pharmaceutical sector is US Pharmacia, a leader on the market of OTC drugs (installation completed 6 months ago). Anica’s products can be quite easily adapted for use by representatives of pharmaceutical distributors, although their role is somewhat different than the role of FMCG distributor representatives, as they do not take orders for drugs directly from the pharmacists. Insurance companies have more than 160,000 agents in Poland. Even if only a small percentage of these companies decide to automate their sales force, the growth in orders for the major providers of SFA solutions could be very significant.

FMCG: Anica services 5,400 of the approximate 25,000 Polish trade reps

Pharmaceutical sector: 20,000 trade reps in Poland

US Pharmacia – Anica’s first SFA installation for an OTC drug manufacturer

Insurance companies – 160,000 agents

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BRE Bank Securities

In summary, we believe Anica’s efforts to sell existing products to Polish clients from sectors other than FMCG are promising. In our opinion, the idea of selling products from the EBI series to FMCG producers and distributors operating on the Russian and Ukrainian markets is very interesting. The FMCG markets in these countries are similar to the Polish market several years ago, with modern forms of trade having a very small share in them. For this reason, they are ideal locations for employing IT solutions that have already been proven on the Polish market. The first two installations of this type using Anica software have already occurred in the Russian representative offices of fast moving consumer goods producers that had earlier used Anica’s systems in Poland. An enticing aspect of the Russian market is its size, requiring producers to employ 3 times as many trade representatives than in Poland. This means the possibility of very large and profitable installations. Anica has not yet decided on the method of developing export sales. Export contracts to date have been initiated by the client. Anica is considering further steps in this direction, possibly employing foreign subcontractors to service the mobile equipment. Greater sales to existing clients The third component of Anica’s strategy involves selling other company products to existing clients. The majority of Anica product users only have the SFA system, which means the possibility of selling them other modules from the EBI series (Connector, Enterprise and Knowledge – to producers, EBI Retail and Vanseller – to distributors). Anica estimates that sales of other EBI modules and the services connected with them could double sales to current clients. Anica is also preparing new products connected with automating the flow of information in the distribution chain; one example of which is software making close cooperation between a producer and distributor possible in order to lower transport costs while simultaneously increasing sales. The interests of a producer and a distributor can occasionally be at odds. It may not be profitable for the distributor to send a vehicle to a store in order to deliver a single product (instead of during a scheduled delivery, together with other products), while filling a store’s shelves with a producers own goods as quickly as possible is, of course, in the interests of the producer. Using Anica’s software could facilitate finding a sensible solution to such conflicting situations. Another element of the distribution chain, the store-client level, is completely outside Anica’s current area of activity. The establishment of networks by small and medium-size stores gives rise to the possibility of them building ties with clients through employing loyalty programmes, similar to those that the networks of large stores have. For producers, this would mean another source of even more detailed knowledge about the market, even to the level of making it possible to analyse the behaviour of individual consumers. A subsequent area of activity for Anica could be rendering consulting and analytical services to FMCG producers and distributors. We very much concur with this element of Anica’s strategy. It is safe, as a client knowing Anica as a reliable service or software provider requires significantly less work on the part of the company in order for it to be considered one of the possible firms to provide another product. Small, initial marketing expenditures from Anica lower the risk. Are planned investments adequate for realising this strategy? We are unable to verify whether the majority of the amounts given by the company as planned expenditures for individual investment goals are adequate, as we do not know the costs of creating new software products. However, the PLN 1 mn designated for exporting services and proprietary software appears rather modest to us, considering the amounts that Comarch designated when it launched export sales. Perhaps Anica’s idea to initially sell only to firms that know the company’s products from Poland will make it possible to develop foreign sales at relatively low cost (this means obtaining a large project for reference purposes from a major client). Human resources and incentive programme Anica is a firm still managed by its founders, which is the basis for the family character of relations inside the firm. Each year the work force expands approximately 25% (42 people in 2004), and contracts are terminated with 7-9 employees (of the 112 employed at the end of 2004). The majority (70%) of company employees are under the age of 30. Employees perceive Anica as a decent employer due to providing good conditions for employee development (training) and to the incentive system of remuneration.

Russia, Ukraine – dispersed FMCG trade, large networks of trade reps

Clients satisfied with SFA can buy subsequent EBI modules

Exports to be developed with modest funds

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BRE Bank Securities

One of the elements of this system is a program in which employees are offered company shares. As part of the current offering, 32 authorised employees may subscribe for a total of 90,000 L series shares, for an issue price of PLN 2. M series shares (180,000) have also been introduced to public trading, which will be offered to Anica employees within the framework of management options. This involves 60,000 shares annually beginning in 2006 (following adoption of financial statements for 2005). These shares will be awarded as remuneration for the company meeting its goals for the given year, at an issue price of PLN 0.20. The value of the M series share issue is approximately PLN 1.3 mn (assuming PLN 7.2 as the share value), which corresponds to about PLN 0.4 mn annually for the next three years. Therefore, the annual cost of this programme is approximately 10-15% of the company’s net profit in the next several years. Following the increase in capital, the shares covered by it will account for 2.7% of all shares, which is a number similar to that in the incentive programmes of other publicly traded companies. The difference in relation to many new incentive programmes adopted by publicly traded companies is the issue price, varying considerably from the likely market price. The second weak point of the incentive programme is the fact that company shares will be awarded based on the company’s results for the next 3 years, the targets for which have not yet been precisely defined (these targets will be set in accordance with the budget, confirmed by the supervisory council). The company will publish forecasts for 2005 and 2006 together with the prospectus, but goals for 2007 will not be released. A fairly high cost of the programme is the price that Anica will pay for establishing stronger ties between the company and key employees. Risk factors

• Possibility of a decline in the share of traditional trade in retail sales below the level that would justify maintaining large networks of trade representatives,

• Consolidation of wholesale trade leading to a decline in the number of entities and the number of their trade representatives,

• Automating the transfer of information between stores, distributors and producers to a degree reducing the need for using trade representatives,

• Crediting increasingly smaller clients and clients from sectors with which the company has no experience – risk of unpaid accounts receivable,

• Lack of experience in corporate takeovers, • Limited experience in operating abroad, • Limited experience in activity on the pharmaceutical market, with significantly stronger

competition (than in the case of FMCG) from SFA providers and the firm IMS collecting trade information,

• Possibility of losing key employees, • Trend of using identical IT solutions throughout an entire international corporation,

regardless of how high the cost of such an approach appears to the Polish branch (the home office pays and wants to have the same solution throughout the firm).

90,000 shares for PLN 2 – meeting obligations from previous years

180,000 shares for PLN 0.20 – new 3-year management options programme

Anica System

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BRE Bank Securities

Producer

Large store

Distributor Small store

Consumer

Diagram of goods flow in retail trade

Producer

Distributor Small store

Consumer

P P P D

Diagram of producer employing the SFA system EBI Producent in traditional trade – order flow

PP – trade representative of producer

Anica System

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BRE Bank Securities

Producer

Distributor Small store

Consumer

P P P D

Diagram of distributor employing SFA system EBI Dystrybutor in traditional trade – order flow

PD – trade representative of distributor

Anica System

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BRE Bank Securities

Producer

Distributor Small store

Consumer

Diagram of employing EBI Enterprise system in traditional trade – information flow on stores,

orders and warehouse inventories

Producer

Distributor Small store

Consumer

P P P D

Diagram of employing EBI Connector system in traditional trade – order flow

PP – trade representative of producer

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BRE Bank Securities

Income Statement PLN mn 2003 2004 2005 2006 2007 Sales 20.9 23.2 25.7 30.5 35.0Gross profit on sales 5.5 5.5 6.8 8.1 9.3Selling costs and administrative costs 2.8 3.0 3.9 4.2 4.4Net profit on sales 2.7 2.5 2.9 3.9 4.9Balance of other operating revenues and operating costs 0.1 0.2 -0.1 -0.1 -0.1EBITDA 3.7 3.9 4.6 5.9 7.4EBITDA margin 17.8% 17.0% 18.0% 19.5% 21.0%Amortisation 1.0 1.3 1.8 2.2 2.6Operating profit 2.7 2.7 2.8 3.7 4.8Operating profit margin 13.0% 11.4% 11.0% 12.3% 13.6%Balance of financial revenues and financial costs 0.1 0.1 0.4 0.4 0.2Gross profit 2.9 2.8 3.2 4.1 5.0Taxes 0.8 0.6 0.7 0.9 1.1Net profit 2.1 2.2 2.5 3.2 3.9

Source: 2003-4 Company, 2005-7 forecasts of BRE Bank Securities

Producer

Distributor Small store

Consumer

Diagram of employing EBI Retail system in traditional trade – spontaneous order flow

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BRE Bank Securities

Balance Sheet PLN mn 2003 2004 2005 2006 2007 Assets 11.1 15.8 27.4 31.1 32.3 Fixed assets 3.6 6.6 10.3 15.6 16.0Tangible and intangible fixed assets 3.3 6.3 10.0 15.3 15.7Long-term investments 0.2 0.2 0.2 0.2 0.2Long-term interperiod settlements 0.1 0.1 0.1 0.1 0.1 Current assets 7.5 9.2 17.0 15.5 16.2Inventories 0.3 0.6 0.7 0.8 1.0Short-term accounts receivable 4.9 5.9 6.9 8.9 11.0Short-term investments 2.1 2.2 9.0 5.4 3.9Short-term interperiod settlements 0.1 0.4 0.4 0.4 0.4 Liabilities 11.1 15.8 27.4 31.1 32.3 Shareholders’ equity 8.3 10.6 24.3 27.5 28.2Liabilities and reserves 2.7 5.2 3.1 3.6 4.1Reserves for liabilities 0.3 0.3 0.3 0.3 0.3Long-term liabilities 0.0 0.0 0.0 0.0 0.0Short-term liabilities 2.4 4.9 2.8 3.3 3.8 Interest-bearing 0.0 0.0 0.0 0.0 0.0 Trade 2.4 4.9 2.8 3.3 3.8Interperiod settlements 0.0 0.0 0.0 0.0 0.0

Source: 2003-4 Company, 2005-7 forecasts of BRE Bank Securities Cash Flow Statement PLN mn 2003 2004 2005 2006 2007 Operating flows 2.3 4.6 1.1 3.8 4.8Net profit 2.1 2.2 2.5 3.2 3.9Amortisation 1.0 1.3 1.8 2.2 2.6Change in working capital -0.5 1.2 -3.2 -1.6 -1.7Other operating flows -0.2 -0.1 0.0 0.0 0.0 Investment flows -1.4 -4.2 -5.5 -7.5 -3.0 Financial flows -1.3 -0.3 11.2 0.0 -3.2Receipts 0.7 0.0 11.2 0.0 0.0 Issue of shares 0.0 0.0 11.2 0.0 0.0Expenses -1.9 -0.3 0.0 0.0 -3.2 Dividends for owners -1.9 0.0 0.0 0.0 -3.2 Repayment of credits, loans 0.0 0.0 0.0 0.0 0.0Total cash flows -0.4 0.1 6.8 -3.7 -1.4

Source: 2003-4 Company, 2005-7 forecasts of BRE Bank Securities, assumption: issue price of K series shares - PLN 6

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BRE Bank Securities

Institutional Sales and Research: Tomasz Mazurczak tel. (+48 22) 697 47 35 DISA Director Tomasz.Mazurczak@breinwest.com.pl Strategic Analysis Michał Marczak tel. (+48 22) 697 47 38 DISA Deputy Director Michal.Marczak@breinwest.com.pl Telecommunications, raw materials, metals, media, hotels Grzegorz Domagała tel. (+48 22) 697 48 03 DISA Deputy Director Grzegorz.Domagala@breinwest.com.pl

Sales:

Michał Skowroński tel. (+48 22) 697 49 68 Michal.Skowronski@breinwest.com.pl Emil Onyszczuk tel. (+48 22) 697 49 63 Emil.Onyszczuk@breinwest.com.pl Marzena Łempicka tel. (+48 22) 697 48 95 Marzena.Lempicka@breinwest.com.pl Grzegorz Stępień tel. (+48 22) 697 48 62 Grzegorz.Stepien@breinwest.com.pl Tomasz Roguwski tel. (+48 22) 697 48 82 Tomasz.Roguwski@breinwest.com.pl Joanna Niedziela tel. (+48 22) 697 48 54 Joanna.Niedziela@breinwest.com.pl

Analysts: Hanna Kędziora tel. (+48 22) 697 47 37 Senior Analyst Hanna.Kedziora@breinwest.com.pl Chemicals, pharmaceuticals, household appliances Andrzej Powierża tel. (+48 22) 697 47 42 Senior Analyst Andrzej.Powierza@breinwest.com.pl Banks, insurance, others Dorota Puchlew tel. (+48 22) 697 47 41 Analyst Dorota.Puchlew@breinwest.com.pl Foodstuffs, clothing, others

Witold Samborski tel. (+48 22) 697 47 36 Senior Analyst Witold.Samborski@breinwest.com.pl IT, construction, others Przemysław Smoliński tel. (+48 22) 697 49 64 Analyst Przemyslaw.Smolinski@breinwest.com.pl Jacek Borawski tel. (+48 22) 697 48 88 Senior Analyst Jacek.Borawski@breinwest.com.pl Technical Analysis

Dom Inwestycyjny BRE Banku S.A. ul. Wspólna 47/49 00-950 Warszawa skr. pocztowa 21 www.brebrokers.com.pl

Anica System

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BRE Bank Securities

BRE Bank Securities has not previously issued a recommendation for shares of Anica System.

List of abbreviations and ratios contained in the report. EV – net debt + market value (EV – economic value) EBIT – Earnings Before Interest and Taxes EBITDA – EBIT + Depreciation and Amortisation PBA – Profit on Banking Activity P/CE – price to earnings with amortisation MC/S – market capitalisation to sales EBIT/EV – operating profit to economic value P/E – (Price/Earnings) – price divided by annual net profit per share ROE – (Return on Equity) – annual net profit divided by average equity P/BV – (Price/Book Value) – price divided by book value per share Net debt – credits + debt papers + interest bearing loans – cash and cash equivalents EBITDA margin – EBITDA/Sales Recommendations of BRE Bank Securities A recommendation is valid for a period of 6-9 months, unless a subsequent recommendation is issued within this period. BUY – we expect that the rate of return from an investment in a company’s shares will be at least 15% higher than the WIG ACCUMULATE – we expect that the rate of return from an investment in a company’s shares will be 5%-15% higher than the WIG HOLD – we expect that the rate of return from an investment in a company’s shares will be within +/-5% in relation to the WIG REDUCE – we expect that the rate of return from an investment in a company’s shares will be 5%-15% lower than the WIG SELL – we expect that the rate of return from an investment in a company’s shares will be at least 15% lower in relation to the WIG Recommendations are updated at least once every nine months. The present report expresses the knowledge as well as opinions of the authors on day the report was prepared. The present report was prepared observing principles of methodological correctness and objectivity, on the basis of sources available to the public, which BRE Bank Securities considers reliable, including information published by issuers, shares of which are subject to recommendations However, BRE Bank Securities, in no case, guarantees the accuracy and completeness of the report, in particular should sources on the basis of which the report was prepared prove to be inaccurate, incomplete or not fully consistent with the facts. Recommendations are based on essential data from the entire history of a company being the subject of a recommendation, with particular emphasis on the period since the previous recommendation. Investing in shares is connected with a number of risks including, but not limited to, the macroeconomic situation of the country, changes in legal regulations as well as changes on commodity markets. Eliminating these risks is virtually impossible. BRE Bank Securities bears no responsibility for investment decisions taken on the basis of the present report or for any damages incurred as a result of investment decisions taken on the basis of the present report. It is possible that BRE Bank Securities renders, will render or in the past has rendered services for companies and other entities mentioned in the present report. BRE Bank Securities serves as offering agent of the company’s shares within the framework of the public offering and received remuneration for brokerage services rendered to the company. Copying or publishing the present report, in full or in part, or disseminating in any way information contained in the present report requires the prior written agreement of BRE Bank Securities. Recommendations are addressed to all Clients of BRE Bank Securities. The activity of BRE Bank Securities is subject to the supervision of the Polish Securities and Exchange Commission. Individuals who did not participate in the preparation of this recommendation, but had or could have had access to the recommendation prior to its publication, are employees of BRE Bank Securities authorised to access the premises in which recommendations are prepared, other than the analysts mentioned as the authors of the present recommendation. Strong and weak points of valuation methods used in recommendations: DCF – acknowledged as the most methodologically correct method of valuation; it consists in discounting financial flows generated by a company; its weak point is the significant susceptibility to a change of forecast assumptions in the model. Multiple – based on a comparison of valuation multipliers of companies from a given sector; simple in construction, reflects the current state of the market better than DCF; weak points include substantial variability (fluctuations together with market indices) as well as difficulty in the selection of the group of comparable companies.