Auditor's report on financial statement of DAGOK Kustanaiasbest OJSC (Kazakhstan) for 2002

/KASE, August 13, 03/ - DAGOK Kustanaiasbest OJSC (Zhetikara, Kostanaiasbest), whose bonds are circulating in Kazakhstan stock exchange's (KASE) official "А" listing category, presented KASE auditor's report, which had been made by Ernst&Young (Almaty) on the company's financial statement for 2002, which had been prepared in compliance with Kazakhstan accounting standards. According to the auditor's data the following indicators are the result of the company's financial and economic activity as of December 31 of 2002 (in th. KZT, unless otherwise specified): -------------------------------------------------------------------- Indicator 2001* 2002 ---------------------------------------------- --------- --------- Paid authorized capital 460,000 460,000 Shareholders' equity 687,782 1,986,396 Total assets 4,678,496 5,610,208 Net working capital 297,995 375,411 Accounts receivable (net) 1,998,724 1,581,135 Liabilities, total 3,940,628 3,623,812 Attracted credits 683,492 599,574 Accounts payable 2,363,717 2,091,520 Issued bonds 893 419 932,718 Volume of goods sold (services rendered) 3,171,790 3,546,856 Cost of goods sold (services) 2,602,072 2,586,950 Net income (loss) (449,992) 352,321 ---------------------------------------------- --------- --------- It's been calculated on the audited statement: ---------------------------------------------- --------- --------- Return on sales (ROS), % 17.96 27.06 Return on equity (ROE), % -65.43 17.74 Return on assets (ROA), % -9.62 6.28 -------------------------------------------------------------------- * - audited by PriceWaterhouseCoopers (Almaty) Auditing of the consolidated financial statement was made by Ernst&Young in compliance with Kazakhstan auditing standards. According to note 2 of the auditor's report as of December 31 of 2001 DAGOK Kustanaiasbest OJSC had a daughter company KAG Asset LLP (trading activity), in which it owned 90% stake of the paid authorized capital. This daughter company was entirely consolidated in the financial statement of DAGOK Kustanaiasbest OJSC for 2001. Within 2002 KAG Assets LLP stopped its activity and stake of DAGOK Kustanaiasbest OJSC in net assets of in this daughter company was compensated in the amount of KZT450,000 th. Keeping from making specifications in the report the auditor pays attention on the fact that a certain part of fixed assets of DAGOK Kustanaiasbest OJSC, which were initially reflected on primary cost, afterwards periodically since January 1 of 1993 till January 1 of 1997 were re-evaluated in compliance with special re-evaluation coefficients, which were set by the State statistics committee of Kazakhstan. The cost of fixed assets, which was determined by this re-evaluation, as of December 31 of 2001 did not meet requirements of Kazakhstan accounting standards. Within 2002 the company got independent estimation of fixed assets in compliance with Kazakhstan accounting standards, and specification, which was included into the report of previous auditors dated May 23 of 2002, was recognized as not concerned with the company's balance sheet as of December 31 of 2002. In auditors' opinion the financial statement gives the impartial and objective description of financial position of DAGOK Kustanaiasbest OJSC as of December 31 of 2002, revenues and expenses, cash flow for the year and changes in the shareholders equity for the reporting year till the mentioned date in compliance with Kazakhstan accounting standards. The company's primary activities: extraction and concentrating of chrysotile- asbestos and production on this base of commercial asbestos and accompanying building materials. [2003-08-13]