ZA Puławy Carries out Planned Investment Projects

Zakłady Azotowe Puławy S.A. will carry out further investment projects aimed at increasing its production capacity. On September 17th 2007, the Company’s Supervisory Board approved, among other things, the “Oxygen Generating Plant – Ammonia – Urea” project included in the Company’s long-term business strategy of April 2007.  

The expansion of the “oxygen generating plant – ammonia – urea” process line is a project of key importance due to technological reasons. It will allow the Company to increase the annual urea production capacity by 270 thousand tonnes – up to 1,215,000 tonnes. The project is divided into two stages. During the first stage a new oxygen generating plant is to be constructed in the over-the-fence design, which will secure uninterrupted operation of the majority of ZA Puławy’s units and installations. The second stage involves modernisation of the urea production unit, which will allow the Company to increase its production capacity. The project, whose value is estimated at approximately PLN 174m, is scheduled to be completed by 2009.

The expansion of ZA Puławy’s production capacity should have a positive effect on the Company’s financial results. Besides its growing significance as a fertiliser, urea is also a vital material for the production of ZAP’s melamine, UAM and Ad-blue.

The Supervisory Board approved the Management Board’s recommendation concerning distribution of profit for the financial year 2006/2007. The proposed dividend for shareholders was PLN 1.7 per share, and the total amount of dividend is to reach PLN 32,495,500. The State Treasury, which is ZA Puławy’s majority shareholder with 50.75% of shares, would receive PLN 16,492,040. 

The proposed distribution of profit is aimed at supporting the Company’s further expansion and growth of its value. A wide-ranging investment programme envisaged in the Company’s strategy for 2007–2017 requires substantial financial expenditure.  Therefore, the Management Board proposed to allocate the largest amount to the Company’s statutory reserve funds. PLN 83.4m of the total profit of a little more than PLN 130m is to be transferred to the statutory reserve funds. 

The Supervisory Board did not decide on the procedure and time for the appointment of President of the Management Board. The Company is now being managed by the Management Board consisting of three members, whose work is coordinated by Lech Kliza, one of the members.

The Management Board of Zakłady Azotowe Puławy S.A. reports that on September 17th 2007 the Supervisory Board approved the recommended distribution of net profit for the financial year 2006/2007. The amount proposed to be allocated to divided is PLN 32,495,500 (PLN 1.7 per share).
The Management Board will submit this proposal along with the recommendation to the General Shareholders Meeting.