Auditor's report on financial statements of NC Kazakhstan Temir Zholy (Kazakhstan) for 2003

/IRBIS, Galina Tsalyuk, July 8, 04/ - National Company Kazakhstan Temir Zholy (Astana) presented KASE auditor's report performed by Ernst & Young (Almaty) over consolidated financial statements for 2003 and prepared in compliance with Kazakhstan accounting standards (KAS). Results of the company's financial and economic activity as of December 31, 2003 according to the report presented in below (in th. KZT, unless otherwise indicated): ----------------------------------------------------------------- 2002 2003 Indicator --------------------------------------- ----------- ----------- Authorized capital (paid) 438,282,879 482,679,030 Shareholders' equity 495,560,575 504,727,779 Total assets 543,546,431 577,423,564 Net working capital 36,233,694 34,655,373 Accounts receivable (net) 28,651,904 47,190,873 Total liabilities 47,820,164 72,695,785 Attracted credits (excluding bonds) 16,100,483 19,175,064 Issued bonds 4,563,867 4,293,377 Accounts payable 27,155,814 44,096,813 Sales volume* 108,525,614 206,255,579 Cost of goods sold 80,434,707 166,874,010 Net income 8,842,716 14,698,494 --------------------------------------- ----------- ----------- It's been calculated by auditor's data: --------------------------------------- ----------- ----------- Return on sales (ROS), % 25.88 19.09 Return on equity (ROE), % 1.78 2.91 Return on assets (ROA), % 1.63 2.55 ----------------------------------------------------------------- * Results for the period from June 1 and December 31 of 2002 as on June 1, 2002 the Company underwent reorganization. As a result, net assets of RGP Kazakhstan Temir Zholy, its daughter and other state owned companies were transmitted to National Company Kazakhstan Temir Zholy JSC. The audit was made over consolidated financial statements for the reported period. Audit of the financial statements of National Company Kazakhstan Temir Zholy was performed by Ernst & Young (Almaty) in compliance with Kazakhstan auditing standards. Consolidated statements for 2003 include financial statements of National Company Kazakhstan Temir Zholy and 15 controlled daughter companies - the Group (in 2002 - 13 companies). In the auditor's opinion the financial statements present fairly, in all essential respects, the financial position of the Group as of December 31, 2003, and the results of its operations, cash flows for the year ended, in accordance with Kazakhstan accounting standards. Main activities of the Company: passenger and cargo railway services, export- import cargo operations. Currently bonds of the Company are circulating under "A" listing category of Kazakhstan Stock Exchange. [2004-07-08]