Annual Financial Report for the period from 1st of January to the 31st of December 2012
79
This action on the part of ALUMINIUM S.A Management was based on and justified by a series of decisions
made by both the RAE itself (831 A/ 2012 and 15/ 2013) as well as decisions made by the Athens Administrative
Court of Appeal (358/ 2012), by which it was concluded that up until the issuing of the RAE decision no con-
tractually agreed or administratively determined price existed, and this price remains to be decided following
the arbitration procedure, which is still in progress, and will be applied retrospectively. With the acceptance
of the above acknowledgement of lack of specific price, on one hand the RAE decisions forbade PPC S.A. to
terminate the contractual relation it has had with ALUMINIUM S.A, and on the other hand the decision of the
Administrative Court of Appeal rejected the petition of PPC S.A. to temporarily suspend the application of the
346/ 2012 RAE decision. Besides, with the IAS 37 , section 36 ‘ the sum acknowledged as a provision, should
regard the best estimate of the cost demanded for the settlement of the present obligation during the end of
the reference period’.
At the same time, according to the IAS 37, section 59 ‘ the provisions should be re-examined towards the end
of each reference period and should be adjusted in such a way so as to reflect the best current estimate’.
Within the framework of the above, on 31/12/2012, according to the 346/ 2012 RAE decision (implementation of
a temporary price of 42 € per megawatt hour for the pricing of electricity supplied by PPC S.A. to ALUMINIUM
S.A pending the final Arbitration decision, 692/ 2011 (Basic Pricing Principles for High Voltage customers) and
798/ 2011 (on the framework of agreement between ALUMINIUM S.A and PPC S.A.) the Management of Alu-
minium S.A deemed it necessary to adjust the provision concerning the value of the consumed electric power
, so that it can reflect the best possible estimate under the circumstances, as they have evolved after the price
determination of the 42 € per megawatt hour made by the Independent regulatory Authority. Let it be noted
that this price per megawatt hour is lower by about 20 € than the price that PPC S.A. had been charging ALU-
MINIUM S.A following a unilateral decision and despite the lack of Contract for the period of 1/7/2010 up until
15/5/2012 (date when the 346/2012 decision was made by the RAE , deciding on a temporary price).
However, in the light of the given uncertainty concerning every pendency of proceedings and also due to the
important future effect (positive or negative) that the definitive outcome of this given case can bring about to
the outcomes, economic position and financial status of the subsidiary company and the Group, a sensitivity
analysis for provisions and liabilities has been carried out , which was incorporated in the Consolidated Finan-
cial Statements of the Group on 31/12/2012. More specifically, the possible effect (positive or negative) which
will occur if the price determined by final arbitration court decision is different from the temporary price of 42€
/ MWh by 1€/ MWh for the period spanning 7/2010 to 31/12/ 2012. In particular , Aluminium S.A subsidiary for
the period of 1/7/2010 to 31/12/2012 has consumed 6.225.576, 63 MWhs of electric power out of which:
• 1.104.777,93 MWhs concern the period of 1/7/2010- 31/ 12/ 2010
• 2.549.914,08 MWhs regard the period of 1/1/2011- 31/ 12/ 2011
• 951.993,74 MWhs regard the period of 1/1/2012- 15/5/2012 (date of RAE temporary price issue) and
• 1.618.890,87 MWhs regard the period of 16/5/2012- 31/12/2012
Therefore, for every 1€/ MWh, the outcomes and the financial position of the subsidiary company and the
Group are expected to be different by :
• € 1.104.777,93 for the period of 1/7/2010- 31/ 12/ 2010
• € 2.549.914,08 for the period of 1/1/2011- 31/ 12/ 2011
• € 951.993,74 for the period of 1/1/2012- 15/5/2012 (date of RAE temporary price issue) and
• € 1.618.890,87 for the period of 16/5/2012- 31/12/2012,
that is by a total of € 6. 225. 576, 63
