YEARLYREPORT2014

ALTA Group 1–11 > Information on the ALTA Group > Foreword by the Chairman of the Board of Directors > Group structure > Czech subsidiaries > Board of Directors of ALTA Invest > Group management > Significant development milestones

Economics 13–15 > Financial indicators > Economic results > Financing

Trade and production 16–21 > Business activities > Mechanical engineering > Mining technologies > Technological projects > Fuel cycle of nuclear power plants > Raw materials and materials

Internal control and internal audit 22Research and development, technologies and innovations 23Social responsibility 24Basic company information 25Report on economic results 26–27

Addresses and contact details 31–32

Contents

ALTA is a modern, dynamically developing business-industrial group, active on the market in the Czech Republic and abroad. Since its foundation, ALTA, established in 1991 as a limited liability company, has focused its international trade operations on the countries of Central and Eastern Europe. At the time of its foundation, export activities were focused on supply of technological systems, machining equipment, machinery products, construction material manufacturing equipment and equipment used for mining and processing of ore and rock. Import operations were dominated by iron ore raw materials and also mechanical engineering products.

In 1994, ALTA was transformed into a joint stock company. The holding structure of the ALTA Group was completed in 2011. The ALTA Group consists of the parent company ALTA Invest, a.s. and its domestic and international subsidiaries, offering a wide range of business, engineering, manufacturing and financial services in many industrial areas:

> ALTA, a.s. offers and provides top quality business, design, engineering and financial services. > Company ALTA MACHINE TOOL, a.s. works in the fields of machine tools and import of raw materials. Company is sole representative of manufacturing plants TOS KUŘIM – OS, a.s., ČKD BLANSKO-OS, a.s. and ŠKODA MACHINE TOOL a.s. in the territory of the CIS.

> The companies TOS KUŘIM – OS, a.s., ČKD BLANSKO-OS, a.s., ŠKODA MACHINE TOOL a.s. and SE-MI Technology, a.s., represent an important manufacturing and design basis of the ALTA Group in the area of machining equipment and equipment for deep and surface mining operations.

> ALVEL, a.s. and DMS s.r.o. offer first-class scientific, engineering and logistics services in the field of nuclear engineering.

> The companies ALTA RUS and ALTA URAL are among the most important foreign subsidiaries of the ALTA Group.

ALTA has repeatedly ranked among one hundred of the most successful Czech companies in a chart put together by CZECH TOP 100.

ALTA is an active member of the Chamber for Commercial Relations, Regional Economic Chamber of South Morava, Regional Economic Chamber of Brno, Economic Chamber of the Czech Republic, Confederation of Industry of the Czech Republic, Association of Engineering Technology, Czech Extraction and Mining Technology Association, Czech Surface Finish Association, Czech Nuclear Forum and Czech Nuclear Association.

Information on the ALTA Group

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Foreword by the Chairman of the Board of Directors

Dear business partners and friends,

Last year was not an easy one for exporters. In addition to the lingering effect of the European economic recession, in the second half of the year a whole range of serious complications regarding the economic and financial relationships associated with the situation in Ukraine, sanctions towards the Russian Federation and devaluation of the Russian Ruble had a negative impact, namely with respect to Eastern Europe countries.

From the point of view of ALTA, the last year was the year of successful realization of the final phase of some of our long-term contracts, such as modernization of the Ashinsky Metallurgical Plant in the Russian Federation and other significant products. The group also focused on certain systemic steps during the preparation of new projects in individual segments of the business activities of the group, as well as in relation to modernization and revitalization of programs of individual production plants of the holding – in ŠKODA MACHINE TOOL and in TOS KUŘIM – OS. This task also corresponded to the economic plan of the group for 2014, which it managed to meet. Even in hard conditions, the success of ALTA stems from its ability to adapt to fast-changing market conditions and offer its partners the most favourable solutions for their investment goals.

The fundamental segments of the activities pursued by the ALTA Group include mechanical engineering and mining technological systems. This includes namely delivery of equipment for heavy engineering, machine tools, mining equipment and deliveries of „turnkey“ technological systems. Perspective options can also be found in the area of realization of complex energy projects. The traditional segment of activity is represented by imports of raw materials, iron ore, fuel cells, etc.

Despite all the difficulties of the current international situation, we are aware of the potential continuously repre-sented by the Russian Federation, Kazakhstan, Belarus, Ukraine and other CIS countries. This is the reason why we have been working systematically on further consolidation of our position in these markets. However, in order to succeed on the market, we will have to exercise more effort, patience and vigour than in the past. A significant comparative advantage of the ALTA Group in this situation is our experience with operation in the region and our many years of cooperation with verified contacts. We are systematically expanding our operation to other regions – Turkey and Serbia, and we strive to increase our export to India and to markets in Northern America or Southeast Asia.

We always put emphasis on sustainable competitiveness and activities of qualified research and development teams. We also cooperate on long-term basis with universities and theoretical institutes – Brno University of Technology, Faculty of Mechanical Engineering of the Czech Technical University, ÚJV Řež and others.In order to optimize management processes and achieve more operative decision-making, towards the end of 2014 business groups for mechanical engineering and import of raw materials separated from ALTA, a.s. and created a new business structure within the group – company ALTA MACHINE TOOL, a.s.

Dear business partners, I would like to thank you for your cooperation and trust and I would like to thank our employees for their high-quality and dedicated work.

We are looking forward to our further cooperation.

Vladimír PlašilChairman of the Board of Directors of ALTA Invest, a.s.

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Group structure (as of 1 July 2015)

ALTA Invest, a.s.

BUSINESS

ALTA, a.s. / Brno

ALTA MACHINE TOOL, a.s. / Brno

ALTA RUS / Moscow

ALTA URAL / Yekaterinburg

TRANSPORT – 21 VEK / Yekaterinburg

MACHINING EQUIPMENT

ŠKODA MACHINE TOOL a.s. / Plzeň

TOS KUŘIM – OS, a.s. / Kuřim

ČKD BLANSKO-OS, a.s. / Kuřim

ENERGETIKA KUŘIM, a.s. / Kuřim

SE-MI Technology, a.s. / Ostrava

MINING EQUIPMENT

ALVEL, a.s. / Prague

DMS s.r.o. / Dukovany

ENERGETICS

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TOS KUŘIM – OS, a.s. Since its founding in 1942, the TOS KUŘIM – OS, a.s. company has been an innovator in implementing new technologies in practice and the trade name of the company soon became the worldwide symbol of reliable and precision machine tools with long service life. The production programme of the company focuses on large milling machines and machining centres, which enable machining of heavy workpieces with large dimensions and very complex shapes from up to five sides and with the application of contouring control in five axes. This involves particularly floor type and gantry type machining centres. The main technological advantage of the TOS KUŘIM machines is a system of automatically interchangeable spindle heads. The machines are used mainly in the heavy engineering industry, the energy sector, the armaments and aircraft industry, in the production of heavy construction machines and mining technological systems, in the shipbuilding and railway industry.

ČKD BLANSKO-OS, a.s. ČKD BLANSKO-OS, a.s. ranks among the leading Czech mechanical engineering companies with a long tradi-tion. The company has been a member of the consolidated entity of the ALTA Group since 2010. Since as early as 1951, the ČKD BLANSKO-OS, a.s. company has specialized in development, construction, manufacture and installation of heavy vertical lathes, the so-called boring mills in single-column or double-column design. Over this period, the company has supplied more than 730 boring mills to thirty countries around the world. The boring mills manufactured by the ČKD BLANSKO-OS, a.s. company serve as multi-professional machining centres enabling lathe turning, milling, boring, drilling and grinding.

ŠKODA MACHINE TOOL a.s. The ŠKODA MACHINE TOOL a.s. company ranks among the world�s leading manufacturers of machine tools. The history of ŠKODA-brand machine tools dates back to 1911. Due to their unique design, the machine tools have become a symbol of precision, reliability and perfect workmanship. ŠKODA�s employees possess great research and development, construction and technological potential and the company keeps ahead of the competition due to the technical level of its products. The ŠKODA horizontal boring machines are represented by a number of heavy quill machines of the HCW type with a boring spindle diameter of 150–300 mm. The heavy series of the horizontal boring machines are complemented with a series of horizontal milling machines of the FCW type with the spindle diameter of 145 and 150 mm. The work stations with horizontal boring machines can be equipped with rotary tables with a load capacity of 25–500 t and a number of various milling and boring heads and other accessories. The ŠKODA heavy lathes are represented by the series with the traditional ŠKODA SR brand.

SE-MI Technology, a.s.The SE-MI Technology, a.s. production company provides supplies of mechanical engineering products and technological systems in the fields of underground and surface mining of raw materials, preparation plants, surface transport systems and equipment designed for other industries based on own technical, production and logistic know-how.

ALVEL, a.s. ALVEL is a company established in 2012 as a joint venture of two major companies operating in the nuclear sector: ALTA (Czech Republic) and TVEL (Russian Federation). The company provides top scientific and engineering services in the nuclear sector, particularly with regard to the nuclear energy installations in the Czech Republic. Another business area is represented by cooperation with companies dealing in supplies for the nuclear energy sector.

DMS s.r.o. The DMS company has long focused on the transport of hazardous materials and radioactive materials, including nuclear materials and the transport of oversized loads. The company provides specialized transport services in the field of the nuclear fuel cycle not only in the Czech Republic but also abroad. Over its twenty-year operation, the DMS s.r.o. company has become a synonym for safe and reliable transport in a global context.

Czech subsidiaries

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Board of Directors of ALTA Invest

Vladimír Plašil> Chairman of the Board of Directors of ALTA Invest, a.s., Chairman of the Board of Directors of ALTA, a.s., within the framework of the Group responsible for strategy and communication.

Bronislav Šimek> Deputy Chairman of the Board of Directors of ALTA Invest, a.s., Chief Executive Officer of ALTA MACHINE TOOL, a.s., within the framework of the Group responsible for business activity in the CIS.

Lubomír Fabík> Deputy Chairman of the Board of Directors of ALTA Invest, a.s., Executive Officer of ALTA MACHINE TOOL, a.s., within the framework of the Group responsible for the economy and finance.

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Group management (as of 1 July 2015)

ALTA Invest, a.s.Vladimír Plašil – Chairman of the Board of DirectorsLubomír Fabík – Deputy Chairman of the Board of DirectorBronislav Šimek – Deputy Chairman of the Board of DirectorsJozef Abrahám – Chief Financial Officer of the ALTA Group

ALTA, a.s.Vladimír Horňák – Chief Executive OfficerRadek Pecina – Manager of the Mining Technologies DivisionJosef Běláč – Manager of the JE Fuel cycle DivisionPavel Petlák – Manager of the Technological Projects DivisionLucie Čípová – Chief Economic OfficerInez Krautmannová – Manager of the ALTA Group Project Financing

ALTA MACHINE TOOL, a.s.Bronislav Šimek – Chief Executive OfficerLubomír Fabík – Executive OfficerKarel Laš – Chief Purchase and Realization OfficerJiří Bartuněk – Chief Sales OfficerHana Kuncová – Chief Economic and Financial OfficerJosef Jančařík – Chief Controlling Officer

ŠKODA MACHINE TOOL a.s.Pavel Seethaler – Chief Executive Officer

TOS KUŘIM – OS, a.s. / ČKD BLANSKO-OS, a.s.Karel Linert – Chief Executive Officer

SE-MI Technology, a.s.Jiří Valenta – Director

ALVEL, a.s.Josef Běláč – Chief Executive Officer

DMS s.r.o.Lukáš Hurdálek – Chief Executive OfficerFerdinand Szemla – Executive Manager

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Significant development milestones

1991 > Foundation of ALTA, spol. s r.o.

1992 > First deliveries of 8PA4 engines for purposes of surface mining combines in CIS countries.

1994 > Transformation of ALTA, spol. s r.o. to joint-stock company ALTA, a.s.

1995 > Signing of a contract on exclusive agency of the Russian manufacturer of fuel cells TVEl for the Czech Republic

> Start of deliveries of iron ore raw materials to the Czech Republic

1996 > Deliveries for investment projects for technologies for mining and processing of ores and rock

1998 > Establishment of representation in Minsk (Belarus)

1999 > Establishment of representation in Kiev (Ukraine) > Commencement of the modernization project of PO BELAZ (Belarus)

2001 > ALTA, a.s. places among the one hundred most successful companies in the chart put together by CZECH TOP 100 for the first time

2002 > Establishment of representation in Yekaterinburg (Russian Federation)

2005 > Signing of a framework agreement for the modernization project for FGUP PO Uralvagonzavod (Russian Federation)

> Property share acquisition in companies TOS KUŘIM – OS, a.s., KULIČKOVÉ ŠROUBY KUŘIM, a.s., and SLÉVÁRNA KUŘIM, A.S.

2006 > Commencement of the modernization project for FGUP PO Uralvagonzavod (Russian Federation)

> Signing of a contract for complex shaft mechanization for the VINACOMIN company (Vietnam)

> Property share acquisition in TRANSPORT – 21 VEK (Russian Federation)

> Signing of a contract with OOO Kuzminetskyi kirpichnyi zavod (Ukraine) for delivery of a complete brick production line

> Signing and commencement of the project for delivery of galvanic lines and varnishing line for Irkut Corporation (Russian Federation)

2007 > Foundation of the subsidiary ALTA URAL providing service for machining tools in Russian Federation

2008 > Capital acquisition in company SE-MI Technology, a.s. (Czech Republic)

> Signing of a framework contract with company OAO Magnitogorskyi metallurgicheskyi kombinat (MMK) for delivery of equipment for preparatory works and processing of overburden

> Establishment of business representation in Donetsk (Ukraine)

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Significant development milestones

2009 > Establishment of representation in Magnitogorsk (Russian Federation)

> Modernization of OAO MMK rolling mill via deliveries of equipment and construction parts for rolling stand 5000

> Signing of contracts with OAO MMK for technological and construction deliveries of peripheries of the vacuum furnace system, continuous casting and the rolling stand 2500 project

> Signing of a contract for delivery of the mining equipment for ZAO Donetskstal

> Signing of a contract for delivery of mining transport and a mechanized system for VINACOMIN

2010 > Acquisition of company ČKD BLANSKO-OS, a.s. and following up on the tradition of production of carousels

> Completion of the project for the largest varnishing line of freight cars in the world for OAO NPK Uralvagonzavod

2011 > Acquisition of a Czech manufacturer of heavy milling machines and lathes, ŠKODA MACHINE TOOL a.s.

2012 > Signing of a memorandum concluded with the Ministry of Energy Sector and Infrastructure of the Republic of Serbia on cooperation on the construction of a new mine complex and a power plant with a capacity of 380 MW

> Signing of a significant contract concluded with the OAO Ashinsky Metallurgical Plant (AMET) concerning reconstruction and complex refurbishment of the rolling line

> Signing of a contract for „turnkey“ delivery for a complete technological line for OOO KKI brick factory, Klincy (Ceramic Product Plant, Bryansk Region, RF)

> Acquisition of DMS s.r.o. – transporter in the area of specialized shipping

> Establishment of the ALVEL, a.s. company

2013 > Delivery of the largest belt conveyors for deep mining in the CIS territory for OAO SUEK in Krasnoyarsk (Russian Federation)

> Construction of a coal-treatment plant for Silesia PG Czechowice (Poland)

> Contract for delivery of a coal-mining complex for OAO Vorkutaugol (Russian Federation)

2014 > Successful completion of the AMET project > Towards the end of 2014 a project for separation of ALTA, a.s. was processed, during which business groups for mechanical engineering and import of raw materials separated from ALTA, a.s. and created a new business structure within the group – company ALTA MACHINE TOOL, a.s. (AMT, a.s.).

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Financial indicators

Total assets(in thousands of CZK)

2013 / 9 728 862

2014 / 8 468 464

Sales(in thousands of CZK)

2013 / 12 487 740

2014 / 10 228 648

Total equity(in thousands of CZK)

2014 / 1 788 654

2013 / 1 597 191

Gross income after taxes(in thousands of CZK)

2013 / 304 424

2014 / 178 049

20132014

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Consolidated economic results of the ALTA Group fully reflect the circumstances of 2014 in the consolidation unit comprising of 15 companies. Considering the results reported by the Group, it can be said that despite the unfavourable situation on CIS markets the group maintained a significant position in its business line. The Group succeeded in completing the tasks planned for 2014 and established a good basis for successful implementation of tasks and plans for 2015.

The consolidated revenues from sales of the ALTA Group pursuant to the International Financial Reporting Standards (IFRS) amounted to MCZK 10,229 and the consolidated profit after tax totalled TCZK 178,049. The operating profit/loss for 2014 amounted to TCZK 50,300. The cost of goods sold includes the interest from finan-cial lease from the leasing company TRANSPORT – 21 VEK. The profit from financial operations amounting toTCZK 179,332 and consists of mostly exchange rate profit. The group realized an exchange rate profit of MCZK 269, all foreign currency conversions were made through cost and income accounts, except for financial deriv-atives which were calculated through the balance sheet, with impact on the group equity amounting to a profit of 21 million.

With respect to assets, compared to the previous year, as far as the volume of individual balance sheet items is concerned, there was a slight increase in the area of long-term assets and also decrease in short-term assets. In the area of short-term assets, this concerns in particular a decrease of cash and trade receivables. The reason for the decrease of receivables was their partial transfer to long-term assets. Furthermore, receivables from financial lease increased. This was due to the return to leasing contracts based on an agreement with the customer. A slight decrease in tangible and intangible fixed assets was also reported. This is probably due to the sale of ALTA UKR. In the area of liabilities, a significant decrease of short-term payables in the amount of MCZK 1,924 was experienced, specifically in the items of received credits and loans. There was also a slight decrease in other payables, mostly received advance payments and deferred income. This mainly concerns due payables, in balance with short-term receivables. Short-term credits and loans were partially transferred to long-term credits. This concerned mainly the credits for the leasing company TRANSPORT – 21 VEK in the Russian Federation.

Considering the fact that the parent company owns the subsidiaries located abroad, the consolidated annual financial statement has been prepared in accordance with the International Financial Reporting Standards (IFRS) and for the sake of comparability, the annual financial statement has been prepared in accordance with IFRS for 2013 as well.

All companies are included in the consolidated annual financial statement as from the date of incorporation of the company or as from the date of acquisition and they are posted by means of the purchase method.

There were no new acquisitions in 2014. Towards the end of 2014 the Ukrainian subsidiary ALTA UKR was sold. In the course of 2014 the splitting of ALTA, a.s., as of 1 January 2015 was prepared.

Economic results

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Every year, the ALTA Group strengthens its leading position amongst the most important Czech exporters. The Group has also succeeded in implementing a number of contracts with bank financing for our customers. Successful realization of these projects is possible thanks to our traditionally good and close relations with banking and insurance institutions.

The range of banks cooperating with us is comprehensive from the perspective of both size and provided services and focus on exports and project financing thereof. With the help of the experience of our banking partners and skill of our employees in the area of export and project financing, we can offer our clients innovative solutions and ensure advantageous financial conditions for successful realization of their business plans.We have a highly qualified team of specialists with real experience in export and project financing acquired in years of working in the banking sector.

We are ready to offer our customers standard export financing based on medium- or long-term credit with EGAP insurance. In this manner, it is possible to finance a wide range of export supply contracts starting with piece supplies, up to supply of technological systems and construction projects on a turnkey basis. We assess in particular the economic and financial standing of the investor�s existing business, justification of the investment and the ability to repay the credit provided. We assist our customers in preparing all the necessary documents for standard analysis of the project and the borrower which banks and the EGAP require. While preparing the structure of the projects within the framework of long-term financing of turnkey supplies, we start by analysing all relevant risks for the project which may affect the ability of the new undertaking to repay its liabilities to the financing bank significantly. This is a comprehensive process, which usually takes 6–18 months and is associ-ated with higher costs related to securing credit. Our customers are informed accordingly. Recently there has been an increase in the interest in supplier credits with deferred repayment in the event of piece supplies of equipment, technological systems or spare parts on the part of our customers. This concerns one-off as well as framework contracts with part supplies with deferred repayment of 12–36 months. In such cases, we are able to offer short-term up to long-term credit with subsequent financing in liaison with cooperating banks and insur-ance companies. We emphasize the necessity that our customers know the conditions and price of this method of their supplies financing as from the very beginning.

The precondition for success in export is an extensive knowledge of, and experience in, the area of export and project financing. Our company has such knowledge and shares it with its customers in the interest of common use of new business opportunities. In spite of the complicated geopolitical situation, we managed to confirm this fact also last year and we offered our clients a complex spectrum of financing options under conditions which were as competitive as was possible considering the given circumstances.

Financing

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Business activities of the ALTA Group consist namely of exports of investment units for mechanical engineering, production of construction matters, energy sector and metallurgy. Imports focus mostly on deliveries of iron ore raw material, metallurgical material and fuel elements of the nuclear cycle.

Business activities of ALTA are traditionally realized via ALTA, a.s. In order to optimize management process and achieve more operative decision-making, towards the end of 2014 a project for the spin-off by merge of ALTA, a.s., was created, where a part separated from ALTA, a.s. and merged with the existing business unit ALTA MACHINE TOOL, a.s. (previously TOS NOVA Výzkum, a.s.) as a successor company. As of 1 January 2015 business groups for mechanical engineering and import of raw materials separated from ALTA, a.s. and created a new business structure within the group - company ALTA MACHINE TOOL, a.s. (AMT, a.s.).

The segment of technological projects is based on the ALTA, a.s. company�s experience in the implementation of large investment projects for foreign customers. In terms of volume, the most important business transaction realized in 2014 was the modernization of the LPC1 line for rolling of thick sheets in the Ashinsky Metallurgical Plant located in the Chelyabinsk region of the Russian Federation. The contract in the volume of 125 million Euro was realized as a turnkey project during 22 months and its aim was to significantly improve the geometry and overall quality of products, including its monitoring throughout the whole production process up to storage of finished products. This investment also significantly expanded the product portfolio and enabled more flexible reaction to completion of orders for smaller customers. The contract for performance of construction and assembly works and local deliveries of equipment that was provided by subsidiary ALTA RUS included extension of a production hall, as well as realization of technological foundations below the equipment, assembly and relocation of existing utility networks, as the whole modernization of LPC1 was carried out during current operation.

Another important case, the delivery of which was completed in 2014, was the construction of a fully automated brick factory in the town of Klincy in the Bryansk Region in the Russian Federation. The brick factory capacity is 80 million brick units ranging from standard bricks up to large-dimension ceramic thermoblocks. This 33 million Euro contract was realized as a turnkey project and subsidiary ALTA RUS was the general supplier of construc-tion and assembly work, just like in the Ashinsky Plant project. Employees of the Technological Projects group ensured contracting and realization of all technological deliveries in the Czech Republic and EU countries.

An important part of business activities of ALTA, a.s. is represented by deliveries of technologies for deep mining and processing of ores and rock. In the segment of technology deliveries, in 2014 the contract for equipment for the „Pokrovskaja“ shaft from the „Donetskstal“ group was realized. Other realized projects included a slag treatment plant for Severstal – Balakovo and a stone treatment line for GM+. We prepared a new technological solution of DPTT 1600 conveyors with an output of up to 7 × 1000 kW, a conveyor for transport of bulk substances between two belts with a slant of 90 degrees and a new type of drum. At the same time, the „Štavalj“ mine and power plant project in Serbia continued.

Business activities

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Ever since its foundation, ALTA, a.s. has been one of the leading suppliers of engineering equipment to countries of Central and Eastern Europe. The area of mechanical engineering within the ALTA Group is currently dominated by AMT, a.s., which is the exclusive representative of TOS KUŘIM – OS, a.s., ČKD BLANSKO-OS, a.s. and ŠKODA MACHINE TOOL a.s. on markets of the Russian Federation, Ukraine and Belarus. AMT also cooperates with other significant mechanical engineering manufacturers in the Czech Republic and in Europe. As far as modernization projects, deliveries of machining tools and other technological and production equipment are concerned, emphasis is currently put mainly on successful realization of the project for delivery of a line for axle processing and production of wheel sets for railroad cars in Kazakhstan. Most of the technological equipment for this project was delivered in 2014 and it was therefore possible to start the assembly and revitalization of the line the following year. Realization of another large project was launched in 2014, specifically the delivery of 12 carousels for a customer in Ural. Other key projects realized in 2014 were namely the initial phase of the contract for delivery of a special carousel with a table diameter exceeding 10 m, delivery of portal milling machines for a manufacturer of railroad vehicles in Russia and delivery of a two-stand carousel for a customer in Uzbekistan. In the same period contracts were also concluded for the warranty and post-warranty service for delivered machines via the service company ALTA URAL.

These specified projects confirmed the ability of ALTA to acquire orders for the most sophisticated equipment, such as specialized machines and production lines, even among the strongest global competition. Acquisition of such orders depends on the business experience in the territory, as well as top project knowledge.

AMT, a.s. within the ALTA Group has also ensured deliveries of iron ore raw material for Moravia Steel a.s. (Třinecké železárny, a.s.) on a long term basis – in 2014 the volume was 1.8 million tons.

Business activities

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The mechanical engineering segment provides optimal technological solutions through the supplied technological systems as well as in the form of supply of individual machines.

Focus: > production, sale and distribution of machine tools produced internally, > sale of machine tools produced externally, > sale of surface treatment equipment, > sale of automated machining lines and operations, > material division equipment, > forming and forging machines, > machining lines and robot work stations, > forming and forging lines and robot work stations, > surface treatment lines (galvanic and varnishing ones), > casting lines, > technological supplies for iron metallurgy, > welding lines and robot work stations, > welding equipment, machines and excess materials, > diagnostic equipment.

Mining technologies

The segment of mining technologies specializes in supply of technologies for raw materials mining in a surface or underground fashion. The supplied technologies, which are well known not only in the CIS countries but also in Poland and Vietnam, are designed both for mining and enrichment of ores and raw materials (namely coal, but also gold, silver and iron ore, chrome, lead, platinum, etc.), and for mining and treatment of materials intended for the building industry (aggregate, sand, etc.).

Focus: > designing, supply and installation of mining mechanized complexes for coal extraction, > designing, supply and installation of technological lines for mining and treatment of ores and aggregates and its further processing (concrete mixing plants, asphalt mixing plants, railroad tie manufacturing),

> design and supply of technological systems for continuous surface mining of ores and coal, > conveyor systems for deep and surface mining, > supply of mineral processing plants, > supply of mining equipment for vertical transport.

Mechanical engineering

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The segment of technological projects specializes in the supply of equipment for production of building materials, in comprehensive solutions in the energy sector (energy sources) and comprehensive solutions for the petro-chemical industry.

Focus: > machines and equipment for the brick-and-tile industry, > machines and equipment for the production of cement and lime, > comprehensive supplies of services and equipment for the chemical and petrochemical industry, > comprehensive supply of services and equipment in the energy sector, > construction of new metallurgical plants and refurbishment of existing ones.

Fuel cycle of nuclear power plantsIn our fuel cycle of nuclear power plants segment we provide comprehensive solutions to fuel cycles in nuclear power plants, namely starting with supplies of nuclear materials and fresh nuclear fuel and proceeding up to optimization studies of their use thereof in the reactor after its irradiation as well.

Focus: > provision of import and export licences for import and export of nuclear materials and double-use items, > licensing of transport packing materials/containers for road as well as air transport of nuclear materials within the territory of the EU,

> supplies of fresh fuel cells and the relating engineering services, including the provision of transport thereof for the nuclear power plants and research reactors in the Czech Republic and Slovakia,

> export of nuclear materials and provision of transport thereof, > import and export of materials and goods belonging to double-use items, > transport of radioactive and hazardous materials and irradiated nuclear fuel.

Raw materials and materials The raw materials and materials segment focuses on the supply of iron ore raw materials to the Czech Republic.

Focus: > iron ore raw materials – concentrates, pellets.

Technological projects

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The corporate management and control of the ALTA Group includes a system of internal control and internal audit. The purpose of the internal control system is to ensure that the set business goals are achieved together with protection of the company assets, effectiveness of in-house processes and protection of the interests of the Group�s shareholders and creditors. The purpose of the internal audit is to assess the internal control system in an independent and impartial manner. In 2014, the Group was subject to a number of audits, which focused in particular on the following:

> protection of assets of the member companies in the Group, > assessment of efficiency, effectiveness and economy of the in-house processes executed in the member companies of the Group,

> assessment of compliance with the set strategic goals and interests of shareholders and creditors of the Group, legislative and regulatory requirements on the part of the member companies in the Group,

> identification of major risks associated with activities pursued by the member companies of the Group and issuing of recommendations concerning management thereof,

> assessment of the effectiveness of the processes securing a true and honest presentation of financial information provided both on the level of the member companies of the Group and on the level of the consolidated financial statement.

The results of the executed audits were provided to the Board of Directors and the Supervisory Board of ALTA Invest. Recommendations were issued on the basis of the determined circumstances, in order to improve the performance of the Group and to minimize the identified risks. A plan for the elimination of the discovered deficiencies was developed on the basis of these recommendations. The department of internal audit contin-uously monitored the performance of corrective measures within the ALTA Group. In 2014, these corrective measures were completed in partial scope.

Internal control and internal audit

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The ALTA Group is continually accentuating its products from the perspective of their sustainable competitive-ness. Due to the technical development departments of the member companies, the Group has highly qualified teams of employees specializing in research and development. This concentrated capacity includes all stages of development of a new product, from design, to construction, to prototype testing.

The Group has been creating and developing the background with the necessary research and development technologies of the latest generation systematically and optimizing the designing processes. The HW and SW support is of a high level and uses, among others, the CAD designing technologies NX, Solid Edge, Solid Works, Auto CAD and the FEM ABAQUS solution. Administration of design data is executed in the system by means of digital archives or PDM systems. The PLM Teamcenter solution is implemented on a pilot basis with a view to administering and controlling the product data within the framework of the entire life cycle thereof with direct reference to the company information system.

ALTA monitors the latest trends, is motivated by new technical findings and tries to apply the latest theoretical knowledge to its product design. The company has cooperated with universities and theoretical research centres on a long-term basis. Among its most important partners in this area are the Faculty of Mechanical Engineering at the Czech Technical University in Prague, the Research Centre for Mechanical Engineering Production Technique and Technology at the Czech Technical University in Prague, the Faculty of Mechanical Engineering at the Brno University of Technology, the University of West Bohemia, the VŠB-Technical University of Ostrava, Research Centre Řež, ÚJV Řež and the research institute and competence center INTEMAC.

In the area of the machine tools production, the company collaborates with the leading suppliers of components, such as Siemens, Heidenhain, Fanuc, INA, FAG, SKF, NSK, ISCAR, Sandvik and Walter.

For the control of development in the medium-term horizon, the member companies have been preparing a plan of technical development, including the application of the latest findings in the sciences and reflecting the marketing priorities and goals of the Group. These plans define the goals for preserving and increasing the value of our products and mutual relations based on the competency of individual entities to secure the necessary activities.

Research and development, technologies and innovations

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The issue of social responsibility has its place and long tradition in the ALTA Group. Relations with clients, partners and suppliers are subject to a mutually strictly transparent approach. Activities within the Group focus above all on charity cultural projects and aid programmes for people in distress and the disabled. Since 2002, ALTA has been a partner to the cultural project Russian Culture in Czech Republic. The festival, which meets with a great response every year, is focused primarily on theatre, ballet, film and music. ALTA is a regular supporter of the Russian Cultural and Educational Association in Moravia. The support of the Social Charitable Fund Domovy potřebných (homes for those in need), which organizes therapeutic stays for children from the Ukraine in USP Kociánka in Brno, has become an established tradition. The financial aid of ALTA contributes regularly to the humanitarian traditions of our nation within the framework of the partnership with Společnost Ludvíka Svobody (an association named after the former Czechoslovakian president). In recent years, sports and other free-time activities for youth have been supported, for instance within the Golf Academy and the skying club or others.

As far as internal aspects of the ALTA Group are concerned, increased attention is paid to the creation of a high-quality working environment supporting employees� personal development. We promote the creation of all conditions necessary for professional development and we prepare individual training plans for our employees with a view to extend and improve their qualifications. Within the framework of education, we accentuate the development of language skills as well. The employees have the opportunity to participate in either individual or group tuition given by our lecturers, who are native speakers. In the ALTA Group, special attention is paid to the principle of equal opportunity. We provide our employees with space for personal self-fulfilment and for innovating existing processes as well. Our flexibility helps create conditions for maintaining the balance between personal and professional life and we support the career development of our female employees. Attention is permanently paid to the high quality of healthcare provided to our employees and we focus on prevention. The ALTA Group offers its employees and their families a wide range of year-round social, cultural and sports activ-ities and a number of social benefits. Among popular events, there is a Christmas Party, a Summer Party for families with children, a sports-focused event called Střelecké odpoledne (shooting afternoon), golf tournaments and the Group-wide bowling tournament.

Social responsibility

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ALTA Invest, a.s.

Trade name: ALTA Invest, a.s.Registered office: Brno, Štefánikova 41Company ID No.: 607 35 244Legal form: joint-stock companyRegistration Court: Regional Court in BrnoIdentification of the companyin the Commercial Register:

Section B, File No. 1497

Date of incorporation: 28 December 1994Registered capital: CZK 200,000,000Number of shares: 220,000 pcs of registered shares

Bodies of the company

Board of DirectorsChairman of the Board of DirectorsVladimír PlašilDeputy Chairmen of the Board of DirectorsLubomír FabíkBronislav Šimek

Supervisory Board

Chairman of the Supervisory BoardPetr Vágner

Basic company information (as of 1 July 2015)

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Report on economic results of the ALTA Group for 2014

ALTA Invest, a.s.

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOMEAS OF 31 DECEMBER 2014, 2013 (thousands of CZK)

Article 2014 2013Income from sales of goods and services 5. 10 228 648 12 487 740Costs for sold goods and services 6. -9 641 840 -11 464 238Gross profit 586 808 1 023 502Distribution costs 7. -122 565 -123 950Administration costs 8. -278 334 -326 805Research and development costs 9. -4 032 -13 852Other operating profit and loss 10. -131 577 -51 363Profit (loss) from sale of shares 11. -5 839 8 484Other financial income 12. 2 296 3 575Other financial expenses 13. -88 689 -111 693Financial profit 14. 300 571 213Financial loss 15. -29 007 -21 680Profit before taxes 229 632 386 431Income tax 16. -51 583 -82 007Profit (loss) for the period from continuing operations 178 049 304 424PROFIT FOR THE PERIOD 178 049 304 424Profit allocated to the shareholders of the parent company 184 623 295 036Profit allocated to non-control shares -6 574 9 388

OTHER COMPREHENSIVE INCOME FOR THE PERIOD:Revaluation reserve for available-for-sale financial assets 1 -2Cash flow hedges of financial derivatives 21 513 -19 088Fund from conversion of foreign currencies for foreign operations -3 278 8 989Tax on other comprehensive income -4 074 3 627OTHER COMPREHENSIVE INCOME FOR THE PERIOD 14 162 -6 474Other comprehensive income allocated to shareholders of the parent company 8 111 782Other comprehensive income allocated to non-controlling shares 6 051 -7 256

COMPREHENSIVE INCOME FOR THE PERIOD 192 211 297 950Total comprehensive income allocated to shareholders of the parent company 192 734 295 818Total comprehensive income allocated to non-controlling shares -523 2 132

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Report on economic results of the ALTA Group for 2014

ALTA Invest, a.s.

CONSOLIDATED STATEMENT ON FINANCIAL POSITIONAS OF 31 DECEMBER 2014, 2013 (thousands of CZK)

Article 2014 2013Short-term assets 6 571 678 8 182 935Cash and cash equivalents 20. 935 981 1 776 199Trade and other receivables 21. 1 687 293 4 521 049Receivables from construction contracts 22. 828 571 741 172Financial lease receivables 42. 1 395 944 50 361Inventories 23. 875 586 743 418Other financial assets 24. 17 375 12 717Other assets 25. 197 494 320 012Assets classified as held for sale 27. 631 105 4 782Tax receivable 26. 2 329 13 225Long-term assets 1 896 786 1 545 927Property, plant and equipment 28. 809 698 878 691Investment property 29. 2 601 1 362Goodwill 30. 531 063 531 063Intangible assets 32. 114 643 125 748Trade and other receivables 21. 99 392 0Financial lease receivables 42. 339 337 1 970Other financial assets 24. 16 59Other assets 25. 36 7 034TOTAL ASSETS 8 468 464 9 728 862 TOTAL EQUITY 1 788 654 1 597 191Share capital 33. 200 000 200 000Funds from profits 34. 10 103 -6 959Retained earnings 1 344 964 1 169 702Non-controlling shares 233 587 234 448TOTAL LIABILITIES 6 679 810 8 131 671Short-term liabilities 5 315 465 7 239 937Trade and other payables 35. 1 517 520 1 688 916Financial lease liabilities 43. 2 193 3 608Liabilities from construction contracts 22. 145 341 146 850Loans and borrowings 36. 2 880 932 4 183 544Other financial liabilities 37. 1 950 7 609Other liabilities 38. 688 986 1 163 074Provisions 39. 78 543 46 336

Long-term liabilities 1 364 345 891 734Trade and other payables 35. 51 090 13 213Financial lease liabilities 43. 3 561 4 200Loans and borrowings 36. 916 033 454 952Other financial liabilities 37. 14 093 18 041Other liabilities 38. 339 010 374 575Deferred payable tax 40. 40 558 26 753TOTAL EQUITY AND LIABILITIES 8 468 464 9 728 862

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Addresses and contact details

ALTA Invest, a.s.Štefánikova 41602 00 BrnoCzech RepublicT +420 541 550 111, F +420 541 550 555e-mail: office@alta.czwww.alta-invest.cz

ALTA MACHINE TOOL, a.s.Štefánikova 41602 00 BrnoCzech RepublicT +420 541 550 111, F +420 541 550 555e-mail: office@alta.cz

ALTA, a.s.Štefánikova 41602 00 BrnoCzech RepublicT +420 541 550 111, F +420 541 550 555e-mail: info@alta.czwww.alta.cz

ALTA, a.s. – Prague OfficeOpletalova 37110 00 Prague 1Czech RepublicT +420 255 729 442/444, F +420 255 729 460e-mail: praha@alta.cz

ALTA, a.s. – Přerov OfficeŽerotínovo náměstí750 02 PřerovCzech RepublicT +420 581 738 770, F +420 581 738 126e-mail: prerov@alta.cz

ALTA, a.s. – Ostrava OfficeMatuškova 10710 00 OstravaCzech RepublicT +420 541 550 620e-mail: ostrava@alta.cz

ALTA, a.s. – Most OfficeBudovatelů 2532434 01 MostCzech RepublicT +420 541 550 625, F +420 595 224 192e-mail: most@alta.cz

ALVEL, a.s.Opletalova 37110 00 Prague 1Czech RepublicT +420 541 550 650, F +420 541 550 660e-mail: info@alvel.euwww.alvel.eu

ŠKODA MACHINE TOOL a.s.Tylova 1/57, Jižní Předměstí301 00 PlzeňCzech RepublicT +420 378 137 733, F +420 378 134 427e-mail: info@skodamt.comwww.skodamt.com

TOS KUŘIM – OS, a.s.Registered office of the company:Štefánikova 41602 00 BrnoCzech Republic

Production plant:Blanenská 257664 34 KuřimCzech RepublicT +420 541 101 111, F +420 541 102 355e-mail: sales@tos-kurim.czwww.tos-kurim.cz

ČKD BLANSKO-OS, a.s.Registered office of the company:Štefánikova 41602 00 BrnoCzech Republic

Production plant:Blanenská 257664 34 KuřimCzech RepublicT +420 541 101 111, F +420 541 103 266e-mail: machinetools@ckd-blansko.czwww.ckd-blansko.cz

SE-MI Technology, a.s.Matuškova 10710 00 OstravaCzech RepublicT +420 595 224 111, F +420 595 224 105e-mail: se-mi@se-mi.czwww.se-mi.cz

DMS s.r.o.Dukovany Power Plant675 50 DukovanyCzech RepublicT +420 561 103 484, F +420 568 866 496e-mail: dispecer@dms.czwww.dms.cz

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Addresses and contact details

ALTA RUSul. Mamina – Sibirjaka, d. 101, office 6119620 075 YekaterinburgRussian Federationwww.alta-rus.cz

Postal address in Saint Petersburg pl. Konstitucii d. 7, office 341a196 191, Saint PetersburgRussian FederationT +(812) 611 11 79, (812) 611 11 76, (812) 611 11 74 e-mail: office-spb@alta-rus.ru

Postal address in Moscow 2-Tverskaja Jamskaja 31/35125 047 MoscowRussian FederationT +007 (495) 232 43 44, T +007 (499) 978 89 66 e-mail: office-alta@mail.ru

ALTA URALul. Mamina – Sibirjaka, d. 101, office 6118620 075 YekaterinburgRussian FederationT +007 (343) 253 05 66, F +007 (343) 253 05 67e-mail: altaural@altaural.ru

Kiev Sales Representationb-r. Lesi Ukrainki 26011 33 KievUkraineT +38 (044) 492 90 14, F +38 (044) 492 90 13e-mail: office@altaukr.com.ua

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www.alta.cz