Annual Report - 01. address

Dear clients, partners and colleagues,,

It is a pleasure for me to report that the past year has been a rousing success and a turning point in the company's history.

After nine years of investment partnership with Asseco Central Europe, which was also the majority shareholder in Slovanet over the same period, we decided to make a major change in the shareholder structure of the company on the basis of a mutual assessment of our opportunities for cooperation. From the very beginning, Slovanet and its focus on telecommunications did not completely fit into Asseco's acquisition portfolio focused primarily on software and IT and was considered more a financial investment than a strategic investment for the company. Cooperation across these sectors delivered positive synergies in business activities but visible differences also appeared between operations in software and telecommunications and in areas such as different financial reporting structures. Asseco CE's listing on the stock exchange committed Slovanet to comply with a variety of regulations and rules, some of which were restrictive, for instance in the area of new acquisitions and investments.

The change was facilitated by an advantageous situation on the capital markets and the courage of the company's original executive management, then a minority owner of Slovanet, to undertake the risky and difficult process of assuming full control over the company. Given the time that has passed and considering the failures of many similar attempts in other companies in the industry, I have to say that this project was a success even with a bit of luck. Slovanet became one of the few Slovak telecommunications operators with exclusively domestic capital in the summer of 2014.

As the representative of the group of its owners, I would like to take this opportunity to express my thanks to the current shareholder and our colleagues from the company and the Asseco Group who were behind our extended run of success on the market during which we managed to significantly grow and strategically change Slovanet.

I consider last year's sales results another major milestone for Slovanet. The company's total revenues recording their highest ever year-on-year increase and exceeded €50 million, another whole number threshold. I am aware that this was primarily due to a number of large and one-off projects but we also achieved increases in areas that are most important to telecommunications enterprises, specifically revenues from regularly provided services and long-term contracts. I am also pleased when comparing our results to those of other major operators; our results demonstrate that our strategy of acquisitions, investments and product innovations was correct.

Once again I will leave a more thorough review of the past year in the hands of our executive director, but please allow me to highlight what I consider a few of the major events and facts. I am pleased that we were able to complete the acquisition of a portion of PO-MA in Banská Štiavnica and its local cable television network with more than 2,000 customers in 2014. The rapid and smooth technical and business integration of this network assures me that we now know one another rather well.

I consider our intensive involvement in Rural Development Programme projects another major success as we were successful bidders in most of the communities involved and were able to build and deploy their Internet networks in record time. Last but not least, I have positive expectations for the purchase of the metropolitan optical network in Bratislava and the strengthening of the sales department, in particular for the business segment. These expectations are confirmed by our results, with new and important customers coming on board and projects to expand the scope of services provided to many existing customers.

I consider our on-going shift away from basic services to an expanded range of services and higher share of value-added services more and more based on cloud solutions to have potential. The results we achieved and, for instance, the national ITAPA award, are motivation for us to be a trendsetter and not a trend follower in these areas.

I would like to thank you all, our clients, employees and business partners, for your trust and your cooperation.

Peter Máčaj
Chairman of the Board of Directors and General Director
Slovanet, a. s.