annual report 2013 - pewetepewete.com/files/f/reports_annual/d963aa/gb_2013_e_… · ·...

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A N A G E M E N TD R I L L I N G

S I D E T R A C K I N GW

E L L S E R V I C E S

An

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al

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20 1 3

ANNUAL REPORT 2013

2ANNUAL REPORT 2013 | ENERgy iN mOTiON

C.A.T. OiL Ag 2013

SELECTEd gROUP FigURES iN ACCORdANCE wiTh iFRS

2013 2012 ChangeTEUR TEUR %

Revenue 426,583 336,772 26.7%

Gross Profit 85,390 54,046 58.0%

EBITDA 114,945 80,029 43.6%

EBITDA margin 26.9% 23.8%

EBIT 64,571 32,150 100.8%

EBIT margin 15.1% 9.5%

Net profit for the period 50,840 21,033 141.7%

Earnings per share (in EUR) 1.04 0.43

Balance sheet total 1) 352,525 365,812 -3.6%

Equity 1) 251,747 244,972 2.8%

Equity ratio 1) 71.4% 67.0%

Capital expenditure 64,733 37,730 71.6%

Cash flow from operating activities 107,397 83,887 28.0%

Cash flow from financing activities -45,717 -39,393 16.1%

Cash and cash equivalents 1) 42,640 38,816 9.9%

Employees (average) 2,773 2,522 10.0%

1) As on 31.12. respectively

KEy gROUP FigURES

KEy FigURES STOCK

German securities ID no. (WKN) A0JKWU

ISIN AT0000A00Y78

Ticker symbol O2C

Class of shares Bearer shares with no nominal value

Authorized capital EUR 48,850,000

Share capital EUR 48,850,000

Free float 41.3%

Number of shares 48,850,000

Highest price ((28.12.2012) EUR 24.22

Lowest price (02.01.2012) EUR 6.54

Closing price (28.12.2012) EUR 20.20

Official trading SDAX, Prime Standard


C.A.T. OiL Ag 2013

... ENERgy iN mOTiON

Our aim is helping to meet the growing need for hydrocarbons by using advanced and efficient technol-ogies. With our modern equipment and the latest technologies we focus on continuously optimizing the efficiency in oil- and gas production, and thus also raising the quality in terms of safety and environment.

C.A.T. oil has been operating in Russia since 1991 and offers its services to Russia’s E&P majors as well as various smaller oil & gas producing companies. During the years of operations we have managed to establish a strong foothold on this market and to turn C.A.T. oil into a reliable and accepted partner for our customers. We enable our business partners to improve profitability of oil and gas production and contrib-ute to the utilization of available resources at a high level of security and efficiency, resulting in stability and effectiveness of energy supply.

We strive for robust growth of shareholder value through a prudent and profitable expansion of well stimu-lation, sidetracking and drilling services as well as development of new service lines. Our business model is based on the following strategic pillars:

wELL iNvESTEd ASSET bASEhigh ENgiNEERiNg qUALiTy ANd AN ExPERT, wELL-COORdiNATEd TEAm OF EmPLOyEESPREdOmiNANTLy ORgANiC gROwThdivERSiFiCATiON ANd RATiONALizATiON OF SERviCE OFFERiNgCONSERvATivE FiNANCiAL POLiCy


C.A.T. OiL Ag 2013

5ANNUAL REPORT 2013 | CONTENT

C.A.T. OiL Ag 2013

CONTENT

Intro 06Management 08

1 C.A.T. OiL ENERgy iN mOTiON 13 2013 at a glance 20The stock 22

2 gROUP mANAgEmENT REPORT 231. Group profile and strategy 24 2. Economic development 28 A. Earnings 30B. Financials 33C. Assets 363. Outlook and risk reporting 384. Disclosures 445. Events after the balance sheet date 49

3 CORPORATE gOvERNANCE 514 REPORT OF ThE SUPERviSORy bOARd 615 CONSOLidATEd FiNANCiAL STATEmENTS 65Group balance sheet 66Group income statement 67Consolidated other comprehensive income 68Group cash flow statement 69Statement of changes in group equity 70

6 NOTES TO ThE CONSOLidATEd FiNANCiAL STATEmENTS 717 AUdiTOR’S REPORT 1168 STATEmENT OF ALL LEgAL REPRESENTATivES 1189 gLOSSARy 119Financial glossary 122Financial calendar 122


C.A.T. OiL Ag 2013

iNTRO

C.A.T. oil has not only met but exceeded its targets in 2013: We expanded our portfolio, extended and strengthened our market share and position, further optimized our cost base as well as our shareholder structure and set the Company’s mid-term roadmap based on the 2014-16 investment program. This holds also perfectly true for C.A.T. oil’s top and bottom line growth.

CONSEqUENTLy PURSUiNg C.A.T. OiL’S PROFiTAbLE gROwTh PAThIn the course of the year we gradually rolled out our 2013 strategic investment program. We increased our operating capacities by approximately 30% for sidetracking and 10% for fracturing. Sustained demand for all of our services, also mirrored in the very successful 2014 tendering campaign, once again confirms our Company’s know how and well developed skills to forecast industry trends and our customers’ needs.

RECORd TOP LiNE gROwTh ANd bOTTOm LiNE PROFiTAbiLiTyThe Russian rouble, which the prevailing majority of our service contracts are denominated in, devalued relative to the euro by around 11% in 2013. This negative trend was however fully surpassed by the Compa-ny’s aggressive expansionary strategies, which fuelled strong organic growth during the reporting period. Backed by continuous demand as well as high operating activity and capacity levels we increased our revenues by 26.7% yoy to EUR 426.6 million. This represents a new record for C.A.T. oil and is close to the top of our revenue target range of EUR 420 to 430 million for 2013. It is particularly encouraging that our new drilling service thereby showed a capacity above 90%. Consistent cost control and efficiency gains were reflected in our profitability: By boosting our EBITDA by 43.6% yoy to EUR 114.9 million we significantly surpassed our guidance of EUR 105 to 110 million. Thereby, our EBITDA margin expanded to 26.9% com-pared to 23.8% in 2012.

OPTimizATiON OF ShAREhOLdER STRUCTUREResponding to requests by investors to improve the stock liquidity, our majority shareholder CAT. Holding (Cyprus) Ltd. reduced its stake in C.A.T. oil from 60% to 48% in December 2013. At the same time, CAT. Holding has expressed its intention to remain fully committed to C.A.T. oil in the long-term. As a consequence C.A.T. oil’s free float increased to 41% from 29% thus boosting the stock trading volumes and liquidity.

mANFREd KASTNER ChiEF ExECUTivE OFFiCER

“ExCEPTiONAL RESULTS iN 2013 PROvidE PROOF OF CONCEPT OF OURbUSiNESS mOdEL ANd dEmONSTRATE ThE POTENTiAL OF C.A.T. OiL’S OPERATiONAL ANd FiNANCiAL STRENgThS ANd CAPAbiLiTiES.”

dear Ladies and gentlemen,dear Shareholders,

we look back at an exciting and eventful year providing proof of concept of our business model. Following the successful implementation of the new drilling ser-vice in 2012, 2013 represented the first year with all of our services, fracturing, sidetracking and drilling in full efficiency. in this set up, C.A.T. oil demonstrated the great potential of its operational and financial strengths and capabilities.


C.A.T. OiL Ag 2013

AmbiTiOUS iNvESTmENT PROgRAm FOR 2014-16 SETS STRATEgiC COURSE FOR ThE COmiNg yEARSBased upon the successful set up of the new drilling service in 2012 and the expansion of sidetracking and fracturing capacities in 2013 we have entered the next phase of C.A.T. oil’s ambitious expansion strategy by launching the 2014-16 EUR 390 million investment program in November 2013. Within the next three years we will expand our operating capacities by 33% for fracturing, 55% for sidetracking and 170% for drilling. We plan to invest approximately EUR 135 million in 2014 and expect the new rigs and fleets to be successively put into operations in the third and fourth quarter of the year. By the end of 2014, operating capacities will be increased by around 10% yoy for fracking, 18% yoy for sidetracking, and 67% yoy for drilling.

PROmiSiNg OUTLOOK dESPiTE gEOPOLiTiCAL UNCERTAiNTiESRussia’s economic growth is expected to slow down in 2014 against the background of geopolitical ten-sions over the Crimean crisis. In this context, downward pressures on the Russian rouble exacerbated in the first months of 2014.

Oil and gas taxes represent a significant part of Russia’s total federal budget revenues. To counteract the oil sector’s deteriorating reserves going forward, the government has recently granted tax incentives to oil companies to incentivize supplementary production. Consequently, the Russian oil industry is poised to continue increasing its upstream spendings in 2014, thus helping to sustain strong tailwinds in the oilfield service industry.

C.A.T. oil is leveraging these dynamics as well as its reputation in the market to continue delivering top-in-class know how and highly efficient services. As of the end of April 2014, C.A.T. oil’s order book for 2014 stands at EUR 415 million, up 6% yoy compared to EUR 392 million a year ago. However, to put our order book for the current year in context we have to take a closer look at the rouble: the 2014 order book is based on an underlying rouble-to-euro exchange rate of 48 compared to the exchange rate of 40 a year ago. In rouble terms, we have increased our order book for the current year by 27% yoy.

Longer-term visibility of revenues and security of service orders are among the key success factors in our industry. We are, therefore, exited that our 2014-16 total order book surpassed the 2013-15 total order book a year ago by 42% yoy to hit a new historic high of EUR 754 million at the end of April 2014. The share of orders beyond a 12-month period thereby rose to 46% compared to 26% a year ago.Based on our record order book and the dynamics in the Russian oilfield service industry C.A.T. oil expects 2014 revenues in the range of EUR 420 to 450 million and EBITDA from EUR 113 to 121 million (based on the average rouble-to-euro exchange rate of 48).

PROPOSEd dividENd PER ShARE UP 40% FROm ThE PREviOUS yEAR LEvELFor C.A.T. oil, 2013 has been a truly successful and profitable year with a net income up by more than 140%. The Management and the Supervisory Board would like to share this success with the company share-holders. At the AGM on 13 June 2014, the Management and the Supervisory Board will therefore propose a dividend of EUR 0.35 per share, representing a profit distribution of around 34% and a 40% increase in dividend per share compared to the dividend a year ago.

We would like to thank our shareholders for their trust in C.A.T. oil. We would also like to thank our employ-ees, C.A.T. oil’s true backbone, for their dedicated work and commitment to our company. Although facing geopolitical uncertainties, we are determined to continue our strong and profitable growth path.

Yours sincerely,Manfred Kastner

8

C.A.T. OiL Ag 2013

ANNUAL REPORT 2013 | ENERgy iN mOTiON

bOARd OF diRECTORS/SUPERviSORy

dR. gERhARd STRATEChAiRmAN OF ThE SUPERviSORy bOARd

dR. mANFREd zAChERdEPUTy ChAiRmAN OF ThE SUPERviSORy bOARd

miRCO SChROETERmEmbER OF ThE SUPERviSORy bOARd

dR. wALTER höFTmEmbER OF ThE SUPERviSORy bOARd

RONALd hARdERChiEF FiNANCiAL OFFiCER

mANFREd KASTNERChiEF ExECUTivE OFFiCER

ANNA bRiNKmANNChiEF OPERATiNg OFFiCER

LEONid miRzOyANChiEF CORPORATE FiNANCE OFFiCER

mANAgiNg bOARd

9

C.A.T. OiL Ag 2013


EUgENi m. PANKRATOvChiEF ExECUTivE diRECTOR

viKTORiA A. SOKOLOvAFiNANCiAL diRECTOR

ELENA KATANOvAdiRECTOR iNTERNATiONAL ACCOUNTiNgANd CONSOLidATiON

ExECUTivE bOARd OF diRECTORS‘S FOR RUSSiA ANd CiS

10

C.A.T. OiL Ag 2013


KAZAKHSTAN

RUSSIAN FEDERATION

UZEN

KARAKUDUK

NIZHNEVARTOVSK

MOSCOW

VIENNA

ORENBURG

KOGALYM

AKTAU

SAMARA

URAI

NYAGANKHANTY-MANSYSK

NEFTEYUGANSK

PURPE

NOYABRSK

RADUZHNYI

STREZHEVOY

VASYUGAN

TOMSK

MEGIONLANGEPAS

wE ARE wORKiNg AT mOST OF ThE imPORTANT OiL FiELdS iN RUSSiAANd ANd KAzAKhSTAN

11

C.A.T. OiL Ag 2013


KAZAKHSTAN

RUSSIAN FEDERATION

UZEN

KARAKUDUK

NIZHNEVARTOVSK

MOSCOW

VIENNA

ORENBURG

KOGALYM

AKTAU

SAMARA

URAI

NYAGANKHANTY-MANSYSK

NEFTEYUGANSK

PURPE

NOYABRSK

RADUZHNYI

STREZHEVOY

VASYUGAN

TOMSK

MEGIONLANGEPAS

1.000 km

Germany

0

Operations Central Offices


C.A.T. OiL Ag 2013

13

EN

ER

G Y I N M O T I O NC A T O I L


C.A.T. OiL Ag 2013

ENERgy iN mOTiON

14

Hig

h C

lass

Dri

llin

gC

lass

ical

Tec

hn

olo

gy

of

Dri

llin

g

IN ADDITION, THE DRILLING RIG IS EQUIPPED

WITH A DEVICE TO CONTROL THE DOWNHOLE PRESSURES AND DEVICES FOR HOISTING AND

TURNING THE PIPES

AS WELL AS FOR CIRCULATION

OF THE DRILLING FLUID

AND FOR REMOVING CUTTINGS

FROM IT.

The drill bit, aided by the weight of thick walled pipes

(„drill string“), cuts into the formation.

AFTER THE HOLE IS DRILLED, SECTIONS OF STEEL TUBING (“CASING”) SLIGHTLY SMALLER IN DIAMETER THAN THE BOREHOLE, ARE PLACED IN THE HOLE AND SECURED WITH CEMENT BETWEEN THE OUTSIDE OF THE CASING AND THE BOREHOLE.

DRILLING FLUID (“MUD”) -

A COMPLEX, CAREFULLY TAILORED MIXTURE OF FLUIDS,

SOLIDS AND CHEMICALS - IS PUMPED DOWN THE INSIDE OF THE DRILL PIPE

AND EXITS AT THE DRILL BIT IN ORDER TO COOL AND CLEAN IT.

HIGH CLASS DRILLING IS THE CLASSICAL TECHNOLOGY OF DRILLING VERTICAL INCLINED AND HORIZONTAL WELLS FOR EXTRACTION

OF OIL AND GAS WITH A DEPTH OF UP TO 5,000 METERS.

The drilling rig

rotates a drill string with

a d

rill

bit

att

ache

d.The drill string is grad

ually leng

then

ed as the w

ell gets

deeper

by

scre

win

g a

dd

itio

nal

sec

tion

s of

pip

e at

th

e surfa

ce.

AN OIL OR GAS WELL IS CREATED BY DRILLING A HOLE INTO THE EARTH WITH A DRILLING RIG WHICH CONTAINS ALL NECESSARY EQUIPMENT AND GENERATES THE REQUIRED ONSITE POWER FOR ALL OPERATIONS.

As the drilling flu

id circulates back to surface outside the drill pipe, it s

weeps up the generated

rock “cuttings” and helps preventing destabilization of th

e rock in the wellbore walls.

The casing provides stability to the newly drilled wellbore and isolates potentially

dangerous high pressure zones from each other and from the surface.Thus, the well can be drilled deeper with a smaller bit,

and also cased with a smaller size casing.

The drill bit


C.A.T. OiL Ag 2013

ENERgy iN mOTiONhighLy SOPhiSTiCATEd

15

Hig

h C

lass

Dri

llin

gC

lass

ical

Tec

hn

olo

gy

of

Dri

llin

g

IN ADDITION, THE DRILLING RIG IS EQUIPPED

WITH A DEVICE TO CONTROL THE DOWNHOLE PRESSURES AND DEVICES FOR HOISTING AND

TURNING THE PIPES

AS WELL AS FOR CIRCULATION

OF THE DRILLING FLUID

AND FOR REMOVING CUTTINGS

FROM IT.

The drill bit, aided by the weight of thick walled pipes

(„drill string“), cuts into the formation.

AFTER THE HOLE IS DRILLED, SECTIONS OF STEEL TUBING (“CASING”) SLIGHTLY SMALLER IN DIAMETER THAN THE BOREHOLE, ARE PLACED IN THE HOLE AND SECURED WITH CEMENT BETWEEN THE OUTSIDE OF THE CASING AND THE BOREHOLE.

DRILLING FLUID (“MUD”) -

A COMPLEX, CAREFULLY TAILORED MIXTURE OF FLUIDS,

SOLIDS AND CHEMICALS - IS PUMPED DOWN THE INSIDE OF THE DRILL PIPE

AND EXITS AT THE DRILL BIT IN ORDER TO COOL AND CLEAN IT.

HIGH CLASS DRILLING IS THE CLASSICAL TECHNOLOGY OF DRILLING VERTICAL INCLINED AND HORIZONTAL WELLS FOR EXTRACTION

OF OIL AND GAS WITH A DEPTH OF UP TO 5,000 METERS.

The drilling rig

rotates a drill string with

a d

rill

bit

att

ac

hed.

The drill string is grad ually len

gth

ened

as the well gets

deeper b

y sc

rew

ing

ad

dit

ion

al s

ecti

ons

of p

ipe

at th

e surfa

ce.

AN OIL OR GAS WELL IS CREATED BY DRILLING A HOLE INTO THE EARTH WITH A DRILLING RIG WHICH CONTAINS ALL NECESSARY EQUIPMENT AND GENERATES THE REQUIRED ONSITE POWER FOR ALL OPERATIONS.

As the drilling flu

id circulates back to surface outside the drill pipe, it s

weeps up the generated

rock “cuttings” and helps preventing destabilization of th

e rock in the wellbore walls.

The casing provides stability to the newly drilled wellbore and isolates potentially

dangerous high pressure zones from each other and from the surface.Thus, the well can be drilled deeper with a smaller bit,

and also cased with a smaller size casing.

The drill bit


C.A.T. OiL Ag 2013

16

Mu

lti-

Sta

ge

Frac

turi

ng

at t

he

fore

fro

nt

The added reservoir contact reduces the amount of well requiredfor field development and associated development costs.

pumping

C.A

.T. o

il is

at t

he fo

refro

nt o

f Rus

sian

m

ulti-

stag

e fra

ctur

ing

tech

nolo

gy.

This

mod

ern

form

of f

ract

urin

g ut

ilizes

long

er h

oriz

onta

l wel

l des

igns

to

max

imiz

e re

serv

oir c

onta

ct. T

he a

dded

re

serv

oir c

onta

ct re

duce

s th

e am

ount

of

wel

l req

uire

d fo

r fie

ld d

evel

opm

ent

and

asso

ciat

ed d

evel

opm

ent c

osts

.

THE SYSTEM OPENS A PATH TO THE RESERVOIR BY PUMPING A FLUID PAD OPENING

UP THE NATURAL FRACTURES AND FILLS THESE OPENINGS WITH PROPPANT

TO SUPPORT THE FRACTURE HEIGHT

MODERN OPEN-HOLE COMPLETIONS SYSTEMS ALLOW MULTI-STAGE JOBS TO BE COMPLETED IN A SINGLE DAY.

C.A.T. oil works closely with International manufacturers and suppliers who supply cutting edge frac systems.

Thes

e sy

stem

s then allow the team to

isolate the first stage

and

op

en the second stage to continue pumping

unti

l the

des

ired amount of stages h

ave been completed.

swellable open-hole packers and sophisticated frac sleeves.M

ulti-

stag

e fr

ac s

chematic view

durin

g the same pumping

operations.

Thes

e multiple frac points are seq

uentially fractured

1. 3. ....

AND ENABLE ADDITIONAL OIL AND GAS PRODUCTION THROUGH INCREASED CONNECTIVITY.

THE MULTI-STAGE FRAC

This

mod

ern

form

of fr

actu

ring u

tilize

s lo

nger

hor

izont

al w

ell d

esig

ns

operations.

ENERgy iN mOTiONEFFiCiENT AdvANCEmENT OF PRESENT ENERgy RESERvES

C.A.T. OiL Ag 2013


17

Mu

lti-

Sta

ge

Frac

turi

ng

at t

he

fore

fro

nt

The added reservoir contact reduces the amount of well requiredfor field development and associated development costs.

pumping

C.A

.T. o

il is

at t

he fo

refro

nt o

f Rus

sian

m

ulti-

stag

e fra

ctur

ing

tech

nolo

gy.

This

mod

ern

form

of f

ract

urin

g ut

ilizes

long

er h

oriz

onta

l wel

l des

igns

to

max

imiz

e re

serv

oir c

onta

ct. T

he a

dded

re

serv

oir c

onta

ct re

duce

s th

e am

ount

of

wel

l req

uire

d fo

r fie

ld d

evel

opm

ent

and

asso

ciat

ed d

evel

opm

ent c

osts

.

THE SYSTEM OPENS A PATH TO THE RESERVOIR BY PUMPING A FLUID PAD OPENING

UP THE NATURAL FRACTURES AND FILLS THESE OPENINGS WITH PROPPANT

TO SUPPORT THE FRACTURE HEIGHT

MODERN OPEN-HOLE COMPLETIONS SYSTEMS ALLOW MULTI-STAGE JOBS TO BE COMPLETED IN A SINGLE DAY.

C.A.T. oil works closely with International manufacturers and suppliers who supply cutting edge frac systems.

Thes

e sy

stem

s then allow the team to

isolate the first stage

and

op

en the second stage to continue pumping

unti

l the

des

ired amount of stages h

ave been completed.

swellable open-hole packers and sophisticated frac sleeves.M

ulti-

stag

e fr

ac s

chematic view

durin

g the same pumping

operations.

Thes

e multiple frac points are seq

uentially fractured

1. 3. ....

AND ENABLE ADDITIONAL OIL AND GAS PRODUCTION THROUGH INCREASED CONNECTIVITY.

THE MULTI-STAGE FRAC

This

mod

ern

form

of fr

actu

ring u

tilize

s lo

nger

hor

izont

al w

ell d

esig

ns

operations.

C.A.T. OiL Ag 2013


18

Hyd

rau

lic F

ract

uri

ng

ou

r co

re b

usi

nes

s

a more efficient and economical way.HYDRAULIC FRACTURING IS A VERY EFFECTIVE METHOD OF WELL STIMULATION. IT SIGNIFICANTLY BOOSTS OIL AND GAS RECOVERY BY FRACTURING THE FORMATION WITH FLUIDS AND PROPPANT PUMPED

INTO THE FRACTURE AT HIGH PRESSURE.

THE RESULT IS THAT OIL AND GAS DEPOSITS CAN BE EXPLOITED IN A MORE EFFICIENT

AND ECONOMICAL WAY.

Hydraulic fracturing

is the fracturing of rock b

y a p

ress

uriz

ed li

qui

d.

Induced hydraulic fracturin

g or h

ydro

frac

turi

ng

co

mm

on

ly k

now

n as

frac

king, is

a technique in which typically water is m

ixed with san

d an

d ch

em

icals,

Hydraulic fracturing is a very effective

method of well s

timula

tion.

It sign

ifican

tly b

oost

s oi

l and

gas

reco

very

by

fract

urin

g th

e fo

rmat

ion

with

flui

ds a

nd p

ropp

ant p

umpe

d in

to th

e fra

ctur

e at

hig

h pres

sure.

a very effective method

of w

ell s

timul

atio

n

and the mixture is injected at high pressure in

to a

wellb

ore

to c

reat

e sm

all f

ract

ures

BY THE CONFINING PRESSURE, DUE TO THE IMMENSE LOAD CAUSED BY THE OVERLYING ROCK STRATA

AND THE CEMENTATION OF THE FORMATION.

FRACTURING IN ROCKS AT DEPTH TENDS TO BE SUPPRESSED PU

MPE

R

TRU

CK

BLEN

DER

TRU

CK

SAN

DTR

UC

K C

HEM

ICAL

TRU

CK

MAN

IFO

LDD

ATA

VAN

C.A.T. OiL Ag 2013


ENERgy iN mOTiONECONOmiC USE

19

Hyd

rau

lic F

ract

uri

ng

ou

r co

re b

usi

nes

s

a more efficient and economical way.HYDRAULIC FRACTURING IS A VERY EFFECTIVE METHOD OF WELL STIMULATION. IT SIGNIFICANTLY BOOSTS OIL AND GAS RECOVERY BY FRACTURING THE FORMATION WITH FLUIDS AND PROPPANT PUMPED

INTO THE FRACTURE AT HIGH PRESSURE.

THE RESULT IS THAT OIL AND GAS DEPOSITS CAN BE EXPLOITED IN A MORE EFFICIENT

AND ECONOMICAL WAY.

Hydraulic fracturing

is the fracturing of rock b

y a p

ress

uriz

ed li

qui

d.

Induced hydraulic fracturin

g or h

ydro

frac

turi

ng

co

mm

on

ly k

now

n as

frac

king, is

a technique in which typically water is m

ixed with san

d an

d ch

em

icals,

Hydraulic fracturing is a very effective

method of well s

timula

tion.

It sign

ifican

tly b

oost

s oi

l and

gas

reco

very

by

fract

urin

g th

e fo

rmat

ion

with

flui

ds a

nd p

ropp

ant p

umpe

d in

to th

e fra

ctur

e at

hig

h pres

sure.

a very effective method

of w

ell s

timul

atio

n

and the mixture is injected at high pressure in

to a

wellb

ore

to c

reat

e sm

all f

ract

ures

BY THE CONFINING PRESSURE, DUE TO THE IMMENSE LOAD CAUSED BY THE OVERLYING ROCK STRATA

AND THE CEMENTATION OF THE FORMATION.

FRACTURING IN ROCKS AT DEPTH TENDS TO BE SUPPRESSED

PUM

PER

TRU

CK

BLEN

DER

TRU

CK

SAN

DTR

UC

K C

HEM

ICAL

TRU

CK

MAN

IFO

LDD

ATA

VAN

C.A.T. OiL Ag 2013


20

FiRST qUARTER

Following the successful setup of the new drill-ing service in 2012, the Company entered 2013 with the new rigs’ capacity utilization at superior levels. The Company embarked on expansion of its sidetracking capacities and put two new rigs in operations. The Company also benefited from a strong upturn in the fracking service job count as well as the growing average job size and complex-ity. As a result, the Company enjoyed a 31.3% YoY increase in revenues to EUR 98.9 million due to a 9.0% YoY rise in the total service job count to 872 jobs and a 20.4% YoY hike in the average per job revenue to TEUR 113.

Cost of sales inflated only 23.2% YoY to EUR 81.1 million primarily due to the elevated operating ac-tivity levels. General and administrative expenses were down 2.0% YoY to EUR 5.3 million primarily as a consequence of the lower bank charges and licence fees.

EBITDA improved by 71.9% YoY to EUR 24.0 mil-lion and the EBITDA margin widened to 24.3% from 18.5% a year ago. EBIT increased almost three-fold YoY to EUR 11.5 million with the EBIT margin expanding to 11.7% compared to 5.3% in Q1 2012. Net income was up 187.5% YoY to EUR 7.2 million.

SECONd qUARTER

Russian oil industry continued to prosper from high commodity prices and new historic highs in crude output. Seasonal improvements in operat-ing activity levels were reinforces by the accom-plished expansion of the Company’s sidetracking capacities. With addition of three new sidetracking rigs in Q2, the Company’s sidetracking capacities expended by around 30% to 22 rigs compared to 17 rigs at the end of 2012. Strong demand for the Company’s highly efficient services, above aver-age capacity utilization and the ongoing changes in the service mix translated into the Company’s outstanding operating and financial performance. The service job count appreciated 13.4% YoY to 994 jobs, whereas the average per job revenue rose 19.0% YoY to TEUR 112 on the continued gains in jobs’ size and complexity. The Company revenues increased by 34.9% YoY to EUR 111.2 million and cost of sales was up 33.8% YoY to EUR 89.5 million. General and administrative expenses contracted 3.1% YoY to EUR 5.7 million, repre-senting 5.2% of revenues in Q2 2013 compared to 7.2% in Q2 2012.

EBITDA advances 44.4% YoY to 28.7 million and the EBITDA margin expanded to 25.8% from 24.1% a year ago. EBIT rose 74.2% YoY to EUR 15.7 million with the EBIT margin widening to 14.1% from 10.9% in Q2 2012. Net income staged a 237.4% YoY increase to EUR 14.0 million.


C.A.T. OiL Ag 2013

2013 AT A gLANCE

JAN FEB MAR APR MAY JUN

21

ThiRd qUARTER

Seasonally high operating activities were rein-forced by the ongoing shift in Russian OFS market towards more complex and service intense tech-niques such as horizontal drilling and multi-stage fracking. The latter was the key driver behind the higher than expected growth in fracking volumes. Supported by the sector’s robust tailwinds, the Company successfully accomplished its 2013 business development plan by expanding its fracking capacities around 10% in Q3 in addition to a 30% increase in sidetracking capacities in H1 compared to the end of 2013. Despite the Russian rouble devaluation relative to the euro, the aver-age per job revenue improved 5.1% YoY to TEUR 105. The Company’s service job count surged 21.3% YoY to 1,072 jobs.

The high-paced business expansion translated in a 24.7% YoY increase in the Company revenues to EUR 112.8 million. Cost of sales appreciated 21.5% YoY to EUR 88.2 million and general and administrative expenses were up 8.9% YoY to EUR 5.2 million on the increased capacities and oper-ating activity levels.

EBITDA improved 33.0% YoY to EUR 33.3 mil-lion and the EBITDA margin expanded to 29.5% from 28.3% a year ago. EBIT advances 78.9% YoY to EUR 21.2 million with the EBIT margin hitting 18.8% compared to 13.4% in Q3 2012. Despite the weaker net financial result, net income came in at EUR 17.0 million, up 98.4% YoY.

FOURTh qUARTER

In November 2013, the Company approved the 2014-16 capital expenditure program of EUR 390 million primarily intended to expand significantly the business scale and develop more rounded business mix. The program foresees an expan-sion of the Company’s operating capacity by 33% for fracturing, 55% for sidetracking and 170% for drilling by the end of 2016 compared to the end of 2013. The Company continued benefitting from a strong acceleration in operating activity levels as witnessed by a 21.0% YoY increase in the service job count to 1,068 jobs. The effect was partly off-set by a 5.3% YoY downturn in the average per job revenue to TEUR 97 on the back of the rouble devaluation. The Company revenues increased 14.6% YoY to EUR 103.6 million.

Cost of sales inflated only 6.4% YoY to EUR 82.4 million, whereas general and administrative ex-penses moderated 0.5% YoY to EUR 5.5 million. EBITDA surges 36.8% YoY to EUR 29.0 million and EBIT stages a 121.1% YoY increase to EUR 16.2 million. The EBITDA and the EBIT margins expanded to 28.0% and 15.6%, respectively, in Q4 2013 from 23.4% and 8.1%, respectively, in Q4 2012. Net income was EUR 12.6 million, up 117.6% YoY.

In December 2013, the Company’s majority share-holder CAT. Holding (Cyprus) Ltd. reduced its ownership in C.A.T. oil AG to 47.7% from 60.0% through the successful accelerated book building (ABB) process. The sale was intended to increase the stock liquidity by expanding free float to 41.3% from 29.0% prior to the ABB.


C.A.T. OiL Ag 2013

JUL AUG SEP OCT NOV DEC

22

C.A.T. OiL Ag 2013


In general the global financial markets rose strongly in 2013. In Europe this was driven, amongst other reasons, by indications that the prolonged recession was coming to an end and by central bank activities.

The German DAX index rose by 26%; the SDAX, on which C.A.T. oil AG shares are listed, even ended the year up more than 29%.

SOARiNg C.A.T. OiL ShARESApart from minor fluctuations, through the year C.A.T. oil shares continually rose, starting the year at EUR 6.54 and reaching a high of EUR 24.22 on 02.12.2013. The final price on 30.12.2013 was EUR 20.20. Their performance was thus considerably better than that of the SDAX reference index and resulted in a gain of more than 200%.

To strengthen the shares’ liquidity, in December CAT. Holding (Cyprus) Ltd. decided to increase the free float from 29% to 41%. It consequently released 6.0 million ordinary shares (12% of capital stock) and document-ed its readiness to fully support C.A.T. oil’s ambitious growth plans by extension of the existing committed credit line granted by CAT. oil: Holding (Cyprus) Ltd. to C.A.T. oil AG.

iNdExEd C.A.T. OiL STOCK PERFORmANCE iN 2013

iNvESTOR RELATiONSC.A.T. oil AG also comprehensively fulfilled its duty of informating to the capital markets and the public in a timely manner in 2013. More than 30 roadshows and conferences were used to inform existing and potential investors in detail about the company’s business model, objectives and strategies and to persuade ratings agencies and private investors of C.A.T. oil’s successful path. Our website www.catoilag.com is available to the general public and contains the latest information relevant to investors.

COvERAgEA remarkable number of 14 and local brokers maintained equity coverage of C.A.T. oil stock during the 2013 financial year.

ANNUAL gENERAL mEETiNgMore than 72% of voting rights was represented at the 8th annual general meeting on 14.06.2013. The shareholders voted for a dividend of EUR 0.25 for the 2013 financial year (2012: EUR 0.125) and thus for a distribution of the balance sheet profits to the value of EUR 12.2 million.

ThE STOCK

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C.A.T. OiL Ag 2013

ANNUAL REPORT 2013 | gROUP mANAgEmENT REPORT

gROUP mANAgEmENT REPORT

24

C.A.T. OiL Ag 2013


gROUP mANAgEmENT REPORT FOR ThE 2013 FiNANCiAL yEAR

1. gROUP PROFiLE ANd STRATEgy

C.A.T. oil Group is one of the leading independent oil and gas field service (OFS) contractors in Russia and Kazakhstan.

1.1. SERviCE PROFiLE ANd ORgANizATiON

The Company’s core service portfolio includes hydraulic fracturing, sidetracking and drilling services. The Company also renders well cementing and completion services, which are complementary to the Compa-ny’s core service offering. The Company services enable oil and gas companies to bring hydrocarbons to production and enhance productivity of new and existing wells over oil and gas fields’ life cycle. Fracturing, cementing and completion services form part of the Company’s operating and reportable segment of Well Services, whereas sidetracking and drilling operations represent a segment of Drilling, Sidetracking and IPM (integrated project management). The following table shows the percentage of the Company’s revenues generated by its service lines in the years ended 31 December 2013 and 31 December 2012:

As of 31 December 2013, the Company’s core operating capacities included 15 fracturing fleets, 22 side-tracking rigs and 9 drilling rigs. Focus on operating efficiency, residing upon modern technology and well-in-vested asset base, has always been one of core pillars of the Company’s business model. The Company’s rigs and fleets are among the youngest and most up to date in the Russian oilfield service universe and, therefore, attain above average productivity and utilization. The prevailing majority of the Company’s fixed assets are manufactured in Europe and North America.

The Group consists of C.A.T. oil AG, which is the Austrian holding company for the Group and the parent company of its three wholly owned operating subsidiaries, CATKoneft, CATOBNEFT and C.A.T. oil Drilling, and two wholly owned auxiliary subsidiaries, C.A.T. oil Leasing and C.A.T. oil Trading House. All these sub-sidiaries are incorporated in Russia. C.A.T. Geodata Gmbh Austria also forms part of the Group structure, however its international seismic operations have been discontinued since Q4 2012. We refer hereinafter to the section Discontinued Operations.

Headquartered in Vienna, Austria, C.A.T. oil AG provides general and administrative services for the Group, such as supervision, oversight, controlling, strategic planning, corporate finance, centralized sales and marketing, risk management and business development functions.

C.A.T. oil AG is 48% owned by CAT. Holding (Cyprus) Ltd. Another 11% is held directly by the Company COO Anna Brinkmann and 41% is free float (Status as of 17 April 2014).

SERviCE PROFiLE

OPERATiNg CAPACiTiES

gROUP ORgANizATiON

% 2013 2012

Hydraulic fracturing 50.8 50.9

Sidetrack drilling 33.4 33.5

High class drilling 13.0 11.6

Cementing 2.5 2.9

Other services 0.3 1.1

25

C.A.T. OiL Ag 2013


The following table shows the Group’s current corporate structure:

1.2 CUSTOmER RELATiONS

The Company enjoys strong and long-lasting customer relations residing upon the Company’s successful track record of servicing major oil and gas groups in Russia and Kazakhstan. To date, the Company has performed more than 25,000 fracturing and 1,000 sidetracking and drilling jobs. These services have en-abled the Company customers to extract more than 1.5 billion barrels of oil equivalent of additional cumu-lative hydrocarbon production over a 20-year period. In 2013, the Company rendered services to more than 20 customers, though its top seven customers, Rosneft, Lukoil, Gazprom Neft, Tomskneft VNK, Slavneft, Russneft and Kazmunaygaz, accounted for 99.0% of the total revenues (2012: 98.8%). The following table shows the percentage of the Company’s revenues generated by its top customers in the years ended 31 December 2013 and 31 December 2012:

C.A.T. oil Ag Vienna, Austria

% 2013 2012

Rosneft inkl. TNK-BP (Russia) 37.2 44.6

LUKOIL (Russia) 29.6 32.5

Gazprom Neft (Russia) 12.8 11.5

Tomskneft VNK (Russia) 8.5 6.7

Slavneft 6.5 0.2

Russneft (Russia) 2.3 0.6

Kazmunaygaz (Kazakhstan) 2.0 2.1

Others 1.1 1.8

Total 100.0 100.0

CATKoneftKogalym, Russia

C.A.T. oil-LeasingKogalym, Russia

100 %

C.A.T. oil drillingKogalym, Russia

100 %

CATObNEFTNizhnevartovsk,

Russia

C.A.T. gEOdATA gmbh

Vienna, Austria

C.A.T. oil Trading house

Kogalym, Russia

100 %

100 % 100 %

100 %

26

C.A.T. OiL Ag 2013


1.3 RESEARCh ANd dEvELOPmENT

The oil and gas industry practice suggests that oilfield services are tailored to a specific field or reservoir en-vironment. In fracturing, the Company’s project engineers work with customers to develop the most effec-tive frack design and adopt the most appropriate well stimulation technique to specific reservoir conditions to ensure that customer’s wells attain the highest possible productivity. The Company has an additional team of research engineers who work closely with the Company’s local managers and project engineers to develop and improve its existing technology and processes. The Company has been consistently focused on improving efficiency of its fracturing services by developing new chemical blends and fluid delivery systems, optimizing mixture of fracking fluids and proppants, selecting advance types of proppant, and optimizing injection process. The Company has also employed consultants from the European Union and North America to reinforce competence of its Russian technical teams with international expertise.

The Company executes all sidetracking jobs on a turnkey basis and, therefore, possesses strong profi-ciency and experience in the area of integrated project management. The Company’s technologists and drilling engineers work out and implement well designs, drilling, fluid and liner programs to improve and optimize drilling techniques and processes for each particular geologic section and reservoir environment. The Company’s technical teams together with subcontractors have been constantly testing new drilling fluid recipes to improve stability of well bores and cease lost circulation problems, applying new bottomhole assemblies, motors and drill bits to maximize rates of penetration and minimize tripping time. The Company has developed and accumulated valuable know-how in sidetrack drilling techniques and processes in its core regions of operations that enable the Company to attain above average operating performance.

Apart from that the Company performs no significant research and development activities.

1.4 bUSiNESS ObjECTivES ANd STRATEgiES

The Company aims at robust growth of shareholder value through a prudent and profitable expansion of its well stimulation, sidetracking and drilling services and development of new complementary services lines primarily in the Company’s home markets, Russia and Kazakhstan. Maintenance and expansion of its am-ple shares in the Russian fracturing and sidetracking markets remain the Company priorities and so does further development of the drilling service.

In November 2013, the Company approved the 2014-16 capital expenditure program of EUR 390 million, of which EUR 300 million are intended for growth and the balance is maintenance capital expenditures. The program is primarily intended to enhance significantly the scale of the Company’s operations and develop more even business mix through the increase of operating capacities by 33% for fracturing, 55% for side-tracking and 170% for drilling by the end of 2016 from the end of 2013. The Company has already placed orders for the new rigs and fleets for 2014. The new capacities are expected to be delivered successively to Russia in Q3-4 2014.

27

C.A.T. OiL Ag 2013


The Company business model resides upon a number of strategic pillars, of which the most important are as follows:

• Well invested asset base and high engineering quality• The Company evolved from a German joint venture partner with Russian production companies in early

1990s to one of the leading independent oil and gas field service companies in Russia and Kazakhstan. As one of the pioneers of hydraulic fracturing services in Russia, the Company aspired to transfer the best available western equipment, technology, operating expertise and business practices to the country. German engineering approach has always been a core of the Company’s business model, targeting effi-ciency, reliability and high quality of the services. The Company has invested more than EUR 450 million in arguably best in class operating capacities since the 2006 IPO.

• Predominantly organic growth• The rationale behind the Company’s prevailing focus on organic growth opportunities is not only lower risk

of organic growth compared to growth by acquisitions but also a scarcity of quality oilfield service assets in the Russian market. The vast majority of oilfield service companies, which are up for sale, are either Soviet legacy assets or in-house service subsidiaries of Russia’s major oil and gas groups or a combina-tion of both. It often happens that these potential acquisition targets possess fully depreciated fixed as-sets and outdated technologies, suffer excess personnel and overwhelming social liabilities or inefficient management practices. In case of spin-offs of in-house oilfield service capacities it also often becomes evident that sellers are primarily interested in rotating and upgrading their contractor base. Therefore, the Company sees only limited opportunities for growth by acquisitions in Russia.

• Diversification and rationalization of service offering• Focus on the service diversification and rationalization should enable the Company to accelerate the

business growth and maximize return on investments in coming years. The Company continues looking for new opportunities to extend its value chain by adding complementary products and services to its portfolio.

• Conservative financial policy • The Company has always been adhered to prudent financial practices and maintained low financial lever-

age. The Company’s business expansion and diversification programs were historically funded through a well balanced mix of debt and equity. As a result, the Company has been able to maintain solid balance sheet with a high equity ratio during upturns and downturns in the industry cycle. The Company targets not to surpass a debt-to-EBITDA ratio above 2.0 times, and even at peak capital expenditures of EUR 110.6 million in 2011, the ratio never exceeded 1.5 times.

1.5 CONTROL SySTEmS

To control and manage growth in shareholder value, the Company put in place the Group-wide unified planning and controlling systems. The Company uses a broad range of profitability, return and capital structure metrics to assess efficiency and performance of its operating and reportable segments as well as take decisions on allocation of resources between the segments. The Company has also developed and successfully implemented the Group-wide procurement and treasury systems to keep a tight grip over pro-curement of materials and supply, fixed assets and subcontractor services as well as the Group’s liquidity.

28

C.A.T. OiL Ag 2013


2. ECONOmiC dEvELOPmENT

2.1 OvERALL ECONOmiC dEvELOPmENT ANd bUSiNESS ENviRONmENT

Russian operations account for around 98% of the Company’s total revenues. After a few consecutive years of healthy recovery from the 2009 trough Russia’s GDP growth moderated, albeit overall macroeconomic environment demonstrated some stability during the reporting period. With the average Brent price con-tracting by 2.7% YoY to USD 109 per barrel in 2013 (2012: USD 112 per barrel), Russia’s GDP expanded only 1.3% YoY (2012: 3.4% YoY), according to the government statistics. Consumer price inflation stayed effectively flat at 6.5% YoY (2012: 6.6% YoY), whereas the Russian rouble depreciated against the euro by 10.6% YoY to 45.0 roubles/euro as of 31 December 2013 from 40.2 roubles/euro as of 31 December 2012.

Contrary to the slowing economy, Russian OFS market stayed buoyant as oil producers continued facing a major structural challenge – the deteriorating reserves productivity – stayed intact during the reporting period. According to the Russian government agency CDU TEK, the existing wells’ average flow rate con-tracted by 3% YoY to 67 barrels per day in 2013 from 69 barrels per day in 2012. Concurrently, the existing wells’ average water-cut increased to 86.8% from 86.2% a year ago. In response to these negative trends the industry’s drift towards more advanced and sophisticated techniques such as horizontal drilling and multi-stage fracturing accelerated during period. Russia’s horizontal drilling footage surged 62% YoY to 4.4 million meters and accounted for 21% of total drilling footage in 2013 compared to 2.7 million meters and 14% in 2012, respectively. Conversely, the demand for vertical and inclined wells contracted as witnessed by a 3% YoY downturn in the related drilling footage to 17.3 million meters from 17.9 million meters a year ago, according to the CDU TEK data. This strategically important technological shift supported a 1.3% YoY gain in Russia’s oil output to 10.5 million barrel per day in 2013 (2012: 10.3 million barrels per day). Russia’s natural gas output accelerated by 2.3% YoY to 64.6 billion cubic feet per day (2012: 63.37 billion cubic feet per day) largely due to the improved demand for Russian gas by the EU countries.

2.2 STATE OF ThE gROUP iN FiSCAL yEAR 2013

Having successfully set up the new drilling service in 2012, the Company extended its investment cycle and expanded its operating capacities by around 30% for sidetracking and 10% for fracturing during the report-ing period. The Company’s business expansion residing upon the new capacity additions was reinforced by the improved utilization of the new drilling rigs above 90% in 2013 from around 60% in 2012. Thanks to it modern and well maintained rigs and fleets, the Company also strongly benefited from the evident hike in customers’ demand for more complex but equally more rewarding horizontal wells. The share of horizontal wells and sidetracks in the Company’s overall drilling and sidetracking mix increased to 48% in 2013 (2012: 38%), whereas the Company’s total drilling and sidetracking footage rose by more than 40% YoY. The ex-ploding growth in Russia’s horizontal drilling, in its turn, facilitated strong growth in demand for multi-stage fracking, which caused a multiplier effect on demand for fracking services. Multi-stage fracking jobs repre-sented 16% of the Company’s total fracking jobs in 2013 (2012: 2%), whereas the Company’s total fracking job count was up more than 17% YoY.

RUSSiA’S ECONOmiC

gROwTh dECELERATEd

iN 2013

gREATER iNTENSiTy ANd

COmPLExiTy OF RUSSiAN

OiLFiELd SERviCES

ExTENdEd iNvESTmENT

CyCLE, RObUST

gROwTh ANd imPROvEd

PROFiTAbiLiTy

29

C.A.T. OiL Ag 2013


The Company’s expansionary strategies, coupled with strong tailwinds in the Russian OFS market, ejected the Company revenues and earnings to the new historic highs during the reporting period. The Company increased its revenues by 26.7% YoY to EUR 426.6 million (2012: EUR 336.8 million) and EBITDA by 43.6% YoY to EUR 114.9 million (2012: EUR 80.0 million). The Company achieved not only strong growth in reve-nues and earnings but further efficiency gains as demonstrated by the EBITDA margin expansion to 26.9% in 2013 from 23.8% in 2012. The Company’s operating income staged a 100.8% YoY improvement to EUR 64.6 million (2012: EUR 32.1 million) with the operating margin widening to 15.1% (2012: 9.5%). The Com-pany’s net income and earnings per share rose 141.7% YoY to EUR 50.8 million (2012: EUR 21.0 million) and EUR 1.041 (2012: EUR 0.431), respectively.

The table below shows the key Group figures in the years ended 31 December 2013 and 31 December 2012 as follows: 31.12.2012:

The Company’s funds from operations and cash flow from operating activities surged 34.1% YoY and 28.0% YoY to EUR 100.1 million and EUR 107.4 million, respectively (2012: EUR 74.7 million and EUR 83.9 million, respectively). Capital expenditures were up 71.6% YoY to EUR 64.7 million (2012: EUR 37.7 million) primarily reflecting the successful expansion of sidetracking and fracturing operating capacities as well as downpay-ments for the new capacities ordered for delivery in 2014. Despite the strong upturn in capital expenditures, the Company’s free cash flow was down only 6.6% YoY to EUR 45.3 million during the reporting period compared to EUR 48.6 million a year ago.

The Company lowered its long-term interest bearing liabilities by 64.2% to EUR 17.9 million as of 31 De-cember 2013 from EUR 50.1 million as of 31 December 2012. As a result, the Company enjoyed net cash position of EUR 24.6 million as of 31 December 2013 as opposed to net debt position of EUR 11.8 million as of 31 December 2012. The equity ratio strengthened to 71.4% as of 31 December 2013 from 67.0% as of 31 December 2012.

gROUP FigURES

RECORd CASh

gENERATiON

STRONg bALANCE ShEET

wiTh PLENTy OF FUNdiNg

CAPACiTy

2013 2012 +/- +/- %

Revenues MEUR 426.6 336.8 89.8 26.7%

Gross profit MEUR 85.4 54.0 31.3 58.0%

EBIT MEUR 64.6 32.1 32.4 100.8%

EBITDA MEUR 114.9 80.0 34.9 43.6%

Gross profit-margin % 20.0 16.0

EBIT-margin % 15.1 9.5

EBITDA-margin % 26.9 23.8

Group result MEUR 50.8 21.0 29.8 141.7%

Earnings per share EUR 1.041 0.431

30

C.A.T. OiL Ag 2013


A) EARNiNgS SiTUATiON

SALES

The Company’s consolidated revenues improved 26.7% YoY and reached a new record of EUR 426.6 million in 2013 (2012: EUR 336.8 million) on the back of the higher operating activity levels and the greater size and complexity of an average service job. The total service job count elevated 16.3% YoY to 4,006 jobs (2012: 3,444 jobs), whereas the average per job revenues improved 9.7% YoY to TEUR 106 (2012: TEUR 97) despite the Russian rouble depreciated against the euro during the reporting period.

The Company has introduced new operating and reportable segments since 1 January 2013 as follows: • Well Services (fracturing, cementing and well completion services);• Drilling, Sidetracking and IPM (integrated project management services).

The contribution of the Company’s operating and reporting segments, Well Services and Drilling, Sidetrack-ing and IPM to the consolidated revenues was as follows:

Well Service segment revenues (from third parties) represented 53.3% of the Company’s total revenues in 2013 (2012: 54.5%). The reportable segment revenues staged a 23.9% YoY increase to EUR 227.4 million (2012: EUR 183.6 million) due to the combined effect of a 16.5% YoY gain in the service job count to 3,772 jobs (2012: 3,237 jobs) and a 6.3% YoY rise in the average per job revenues to TEUR 60 (2012: TEUR 57).

Drilling, Sidetracking and IPM segment revenues (from third parties) represented 46.8% of the Company’s total revenues in 2013 (2012: 45.4%). The reportable segment revenues increased by 30.4% YoY to EUR 199.5 million (2012: EUR 153.0 million). The segment’s job count rose 13.0% YoY to 234 wells and side-tracks (2012: 207 wells and sidetracks) and per job revenue staged a 15.3% YoY upturn to TEUR 853 from TEUR 739 due to the greater share of more complex horizontal wells. The combined drilling and sidetrack-ing footage expanded by 43.1% YoY to 302 thousand meters (2012: 211 thousand meters)

The Company discontinued its Formation Evaluation business in 2012, therefore the segment revenues were nil in 2013 (2012: EUR 2.5 million). The former Formation Evaluation segment results are presented in reconciliation.

CONSOLidATEd

REvENUES SURgEd

26.7% yOy

wELL SERviCE SEgmENT:

REvENUES UP 23.9% yOy

dRiLLiNg, SidETRACKiNg

ANd iPm: REvENUES

iNCREASEd 30.8% yOy

OThER SEgmENTS:

diSCONTiNUEd

FORmATiON EvALUATiON

bUSiNESS

31

C.A.T. OiL Ag 2013


The table below shows the details of the Company revenues and job count by operating and reportable segments in the years ended 31 December 2013 and 31 December 2012 as follows:

COSTS

The Company’s cost of sales, which primarily consists of materials and supply, direct costs, depreciation, wages and salaries, inflated 20.7% YoY to EUR 341.2 million in 2013 (2012: EUR 282.7 million) primarily due to the greater operating activity levels and the enhanced average job size and complexity. Cost of materials and supply went up 40.8% YoY to EUR 128.1 million (2012: EUR 91.0 million) and direct costs, which pri-marily include transportation, mobilization, adaptation, subcontractor, repair and maintenance costs, were up 15.5% YoY to EUR 96.3 million (2012: EUR 83.3 million). Wages and salaries rose 10.7% YoY to EUR 45.6 million (2012: EUR 41.2 million) primarily due to the addition of new employees to the Company’s drilling and sidetracking operations. Social security and welfare expenses increased 17.5% YoY to EUR 11.7 million (2012: EUR 9.9 million) owing primarily to the higher wages and salaries. Depreciation expense was up 4.8% YoY to EUR 49.9 million (2012: EUR 47.6 million) reflecting net effects of disposals and additions of fixed assets as well as foreign currency translations.

Gross profit improved 58.0% YoY to EUR 85.4 million in 2013 (2012: EUR 54.0 million) and the gross profit margin expanded to 20.0% (2012: 16.0%).

General and administrative expenses edged up 0.5% YoY to EUR 21.7 million in 2013 (2012: EUR 21.6 mil-lion). The increase in general and administrative expenses primarily owed to the higher wages and salaries, social security, lease and traveling expenses.

The Company accrued other net operating income of EUR 0.9 million in 2013 as opposed to other net operating loss of EUR 0.3 million in 2012 primarily due to the higher disposals of fixed assets and sales of materials.

ExTERNAL REvENUES

COST OF SALES UP

20.7% yOy dUE TO

A STRONg bUSiNESS

ExPANSiON

gROSS PROFiT

SURgEd 58.0% yOy

gENERAL ANd

AdmiNiSTRATivE ExPENSES

EdgEd UP 0.5% yOy

OThER OPERATiNg

iNCOmE ANd LOSS

2013 2012 +/- +/- %

Well Services MEUR 227.4 183.6 43.8 23.9

Jobs 3,772 3,237 535 16.5

Average revenue TEUR 60.3 56.7 3.6 6.3

Share of revenue % 53.3 54.5

Drilling, Sidetracking, IPM MEUR 199.5 153.0 46.5 30.4

Jobs 234 207 27 13.0

Average revenue TEUR 852.6 739.3 113.0 15.3

Share of revenue % 46.8 45.4

Group management/consolidation MEUR -0.3 -2.3 2.1 -

Reconsiliation MEUR 0 2.5 -2.5 -

Total MEUR 426.6 336.8 89.8 26.7

32

C.A.T. OiL Ag 2013


RESULTS

The Company’s earnings before interest, corporate tax, depreciation and amortization (EBITDA) staged a 43.6% YoY increase to EUR 114.9 million in 2013 (2012: EUR 80 million), resulting in the EBITDA margin ex-pansion to 26.9% (2012: 23.8%). Despite the higher depreciation expense, the Company’s earnings before interest and corporate tax (EBIT) improved 100.8% YoY to EUR 64.6 million (2012: EUR 32.1 million) with the EBIT margin rising to 15.1% (2012: 9.5%).

The table below shows the details of the Group’s EBITDA and EBIT by operating and reportable segments in the years ended 31 December 2013 and 31 December 2012 as follows:

The Company’s net financial result advanced to EUR -1.9 million in 2013 from EUR -2.3 million in 2012. The financial result primarily reflected the combined effect of foreign currency translation loss of EUR 0.7 million (2012: foreign currency gain of EUR 0.7 million) and net interest expense of EUR 1.1 million (2012: EUR 3.0 million).

The table below shows the details of the Company’s financial result in the years ended 31 December 2013 and 31 December 2012 as follows:

EbiTdA AdvANCEd

43.6% yOy ANd

EbiT dOUbLEd yOy

EbiTdA ANd EbiT

ThE imPROvEd

NET FiNANCiAL RESULT

FiNANCiAL RESULT

mEUR 2013 2012 +/- +/- %

EBITDA

Well Services 56.5 41.9 14.5 34.6

Drilling, Sidetracking, IPM 63.7 53.0 10.6 20.1

Group management/consolidation -5.2 -18.5 13.3 -71.9

Reconsiliation 0 3.5 -3.6 -100.0

EbiTdA group 114.9 80.0 34.9 43.6

EBIT

Well Services 42.4 22.9 19.5 84.8

Drilling, Sidetracking, IPM 30.8 24.8 6.0 24.2

Group management/consolidation -8.5 -18.3 9.8 -53.6

Reconsiliation 0 2.8 -2.9 -100.0

EbiT group 64.6 32.2 32.4 100.5

mEUR 2013 2012 +/- +/- %

Interest income 0.7 0.4 0.3 111.2

Interest expenses related parties -1.9 -3.4 1.5 -44.3

Foreign exchange results -0.7 0.7 -1.4 -195.0

Financial result -1.9 -2.3 0.4 -16.6

33

C.A.T. OiL Ag 2013


Pre-tax profit increased 109.7% YoY to EUR 62.7 million in 2013 (2012: EUR 29.9 million) due to the com-bined effect of the higher EBIT and the improved net financial result. The pre-tax profit margin was 14.7% in 2013, up from 8.9% in 2012.

Income tax expense inflated 33.7% YoY to EUR 11.9 million in 2013 (2012: EUR 8.9 million) primarily reflect-ing the higher gross taxable profit and changes in deferred tax assets and liabilities during the reporting period. Income tax expense consisted of the following components, which are presented relative to the previous year in the table below as follows:

The Group’s net income increased by 141.7% YoY to EUR 50.8 million in 2013 (2012: EUR 21.0 million) and earnings per share – according to IAS 33 – amounted to EUR 1.041, up from EUR 0.431 a year ago. There had been no change in the weighted average number of shares outstanding in 2013 (2012: 48,850,000).

b) FiNANCiAL SiTUATiON

The Company stayed adhered to its conservative financial policy and strengthened its balance sheet during the reporting period: the equity ratio improved to 71.4% as of 31 December 2013 (31 December 2012: 67.0%). The improvement in the equity ratio was primarily attributed to a 64.2% decline in long-term debt awarded by CAT. Holding (Cyprus) Ltd. to EUR 17.9 million as of 31 December 2013 (31 December 2012: EUR 50.1 million). The Company’s short-term debt, which primarily represent the rouble-denominated short-term loans and overdraft facilities at the subsidiary level, contracted 72.3% to EUR 0.1 million as of 31 December 2013 (31 December 2012: EUR 0.5 million). As of 31 December 2013, the Company had net cash (cash and cash equivalents less interest-bearing liabilities) of EUR 24.6 million as opposed to net debt (interest-bearing liabilities less cash and cash equivalents) of EUR 11.8 million as of 31 December 2012.

The Company’s dividend policy aims at returning to shareholders at least 20% of the Company’s consoli-dated net income over the long-term earnings cycle (the policy is available on the Company website). The Company’s historic cash dividend distribution is presented in the table below as follows:

PRE-TAx PROFiT

UP 109.7% yOy

iNCOmE TAxES

iNCREASEd 33.7% yOy

TAx ExPENSES / iNCOmE

NET iNCOmE SURgEd

141.7% yOy

CONSERvATivE

FiNANCiAL POLiCy

ANd STRENgThENEd

bALANCE ShEET

CASh dividENd

2013 2012

mEUR share of total (%)

mEUR share of total (%)

Current income tax expenses 9.4 79.4 5.3 59.6

Deferred tax expenses 1.1 9.1 2.6 28.9

Withholding tax 1.7 14.2 1.0 11.5

Income tax for previous years -0.3 -2.6 0.0 -

Total 11.9 8.9

year Cash dividend (EUR per share)

2010 for 2009 0.30

2011 for 2010 0.10

2012 for 2011 0.125

2013 for 2012 0.25

2014 for 2013 0.35

34

C.A.T. OiL Ag 2013


CAPiTAL STRUCTURE

Trade payables increased by 26.9% to EUR 45.5 million as of 31 December 2013 compared to EUR 35.9 million as of 31 December 2012 primarily due to the Company’s business expansion during the reporting period. Income tax payables increased by 8.5% to EUR 1.0 million as of 31 December 2013 from EUR 0.9 million as of 31 December 2012. Other current liabilities diminished 2.6% to EUR 17.7 million as of 31 De-cember 2013 from EUR 18.2 million as of 31 December 2012. The decrease was primarily attributable to the lower property tax and wage payables.

The Company’s deferred tax liabilities increased 21.1% to EUR 18.5 million as of 31 December 2013 from EUR 15.3 million as of 31 December 2012. The increase primarily reflected the effects of the forementioned loans awarded by CAT. Holding (Cyprus) Ltd.

As of 31 December 2013 the Company had subscribed capital of EUR 48.9 million and capital reserves of EUR 112.0 million. There had been no change to the Company’s subscribed capital and capital reserves since 31 December 2012. Foreign currency exchange reserves decreased to a deficit of EUR 62.5 million as of 31 December 2013 from a deficit of EUR 30.7 million as of 31 December 2012. This is the result of the different exchange rate development of the functional currency rouble to the reporting currency euro. These are translation adjustments referring to net investment and translation of net assets, financials and earnings of the Russian subsidiaries in euros. Retained earnings increased by 33.6% to EUR 153.5 million as of 31 December 2013 compared to EUR 114.8 million as of 31 December 2012.

The table below shows the Company’s equity and equity ratio in the years ended 31 December 2013 and 31 December 2012 as follows:

For 2013, the Company initially budgeted capital expenditures at EUR 45 million, of which EUR 20 million represented the outstanding payment for the new sidetracking and fracturing capacities and EUR 25 million were due to maintenance capital expenditures. In the first half of 2013, the Company successfully deployed five new sidetrack drilling rigs in the field, thus increasing its sidetracking capacity by around 30% to 22 rigs from 17 rigs at the end of 2012. The Company also expanded its pressure pumping capacity by around 10% in Q3 2013 compared to the end of 2012 to meet customers’ demand for more complex and sizeable fracking jobs.

Following approval of the new 2014-16 investment program of EUR 390 million in November 2013, the Com-pany increased its 2013 capital expenditures by EUR 19.7 million to the total of EUR 64.7 million primarily to accommodate downpayments for the planned capacity additions in 2014.

CURRENT LiAbiLiTiES

NON CURRENT

LiAbiLiTiES

ShAREhOLdER EqUiTy

dEvELOPmENT

OF EqUiTy ANd

EqUiTy RATiO

iNvESTmENTS

2013 2012 2011

Consolidated balance sheet total MEUR 352.5 365.8 353.2

Equity MEUR 251.7 245.0 219.9

Equity ratio % 71.4 67.0 62.3

35

C.A.T. OiL Ag 2013


LiqUidiTy

Funds from operations up 34.1% YoY and cash flow from operating activities advanced 28.0% YoY

The Company’s funds from operations surged 34.1% YoY to EUR 100.1 million in 2013 (2012: EUR 74.7 million) primarily reflecting the higher pre-tax profit and depreciation. Cash flow from operating activities increased by 28.0% YoY to EUR 107.4 million (2012: EUR 83.9 million) due to the higher funds from oper-ations.

The table below shows the Company’s funds from operations and cash flow from operating activities in the years ended 31 December 2013 and 31 December 2012 as follows:

Capital expenditures were up 71.6% YoY to EUR 64.7 million in 2013 (2012: EUR 37.7 million) primarily due to expansion of the Company’s sidetracking and fracking capacities. Capital expenditures also included downpayments of EUR 17.3 million for the new capacity additions in 2014.

With the proceeds from sale of fixed assets of EUR 2.7 million (2012: EUR 2.4 million), the Company’s cash flow from investing activities was a net outflow of EUR 62.1 million in 2013 compared to a net outflow of EUR 35.3 million in 2012.

The Company’s free cash flow contracted 6.6% YoY to a net inflow of EUR 45.3 million in 2013 from a net inflow of EUR 48.6 million in 2012. The downturn primarily owed to the increased investments in new op-erating capacities during the reporting period. The table below shows the Company’s free cash flow in the years ended 31 December 2013 and 31 December 2012 as follows:

The Company’s cash flow from financing activities was a net outflow of EUR 45.7 million in 2013 (2012: a net outflow of EUR 39.4 million). Cash flow from financing activities primarily reflected a 7.5% YoY increase in net redemptions of interest-bearing liabilities to EUR 32.5 million (2012: net redemptions of EUR 30.3 million). Cash flow from financing activities was also impacted by a 100.0% upturn in cash dividend to EUR 12.2 million (2012: EUR 6.1 million) and a 67.2% decrease in cash interest expense to EUR 1.0 million in 2013 from EUR 3.0 million in 2012.

Cash and cash equivalents were EUR 42.6 million as of 31 December 2013, up 9.9% from EUR 38.8 million as of 31 December 2012.

CASh FLOwS FROm

OPERATiNg ACTiviTiES

CASh FLOw FROm

iNvESTmENT ACTiviTiES

FREE CASh FLOw

FREE CASh FLOwS

CASh FLOw FROm

FiNANCiNg ACTiviTiES

mEUR 2013 2012 +/- %

Cash earnings 100.1 74.7 34.1

Changes in working capital 7.3 9.2 -21.3

Cash flows from operating activities 107.4 83.9 28.0

mEUR 2013 2012 +/- %

Cash flows from operating activities 107.4 83.9 28.0

Cash flows from investing activities -62.1 -35.3 75.7

Free cash flows 45.3 48.6 -6.6

36

C.A.T. OiL Ag 2013


C) ASSETS SiTUATiON

Despite strong business expansion, total current assets increased only 0.6% to EUR 140.9 million as of 31 December 2013 from EUR 140.0 million as of 31 December 2012. Inventories were down 20.4% to EUR 19.6 million as of 31 December 2013 from EUR 24.7 million as of 31 December 2012, whereas trade receivables edged up 0.8% to EUR 73.5 million as of 31 December 2013 from EUR 72.9 million as of 31 December 2012. The developments owed to the Company’s successful undertakings to improve turnover of inventories and trade receivables. Other current assets inflated 42.7% to EUR 5.1 million as of 31 December 2013 from EUR 3.6 million as of 31 December 2012 primarily due to the increase in VAT receivables and advanced payments of income tax and other taxes.

Property, plant and equipment decreased by 8.2% to EUR 196.1 million as of 31 December 2013 from EUR 213.6 million as of 31 December 2012 reflecting a net result of foreign exchange differences, depreciation, disposals and additions during the reporting period. Goodwill, resulting from consolidation of CATOBNEFT in 2004, contracted 11.0% to EUR 3.5 million as of 31 December 2013 (31 December 2012: EUR 3.9 million) primarily due to foreign currency exchange effects. Deferred tax assets increased to EUR 10.9 million as of 31 December 2013 from EUR 7.9 million as of 31 December 2012 .

The Company’s total assets were down 3.6% to EUR 352.5 million as of 31 December 2013 compared to EUR 365.8 million as of 31 December 2012.

The table below shows the Group’s balance sheet structure as of 31 December 2013 and 31 December 2012 as follows:

CURRENT ASSETS

NON CURRENT ASSETS

gROUP‘S

bALANCE ShEET

STRUCTURE

2013 2012

mEUR Share in % mEUR Share in %

Current assets 140.9 40.0 140.0 38.3

Non-current assets 211.6 60.0 225.8 61.7

Assets 352.5 100.0 365.8 100.0

Current liabilities 64.4 18.3 55.5 15.2

Non-current liabilities 36.4 10.3 65.3 17.9

Equity 251.7 71.4 245.0 67.0

Liabilities and equity 352.5 100.0 365.8 100.0

37

C.A.T. OiL Ag 2013


d) PERFORmANCE iNdiCATORS

FiNANCiAL PERFORmANCE iNdiCATORS

The Company improved the return on capital employed (ROCE) to 26.3% in 2013 from 11.8%, in 2012.

As of 31 December 2013, net working capital of EUR 34.0 million, down 26.4% compared to EUR 46.2 mil-lion as of 31 December 2012, provided sufficient liquidity to the Company operations.

NONFiNANCiAL PERFORmANCE iNdiCATORS

The Company’s weighted-average headcount rose 10.0% YoY to 2,773 employees in 2013 from 2,522 em-ployees in 2012. The increase primarily reflected the hiring of the additional managerial, engineering and crew staff for the expanded sidetracking operations.

The Company recognizes that the ability to educate, attract and retain high-caliber personnel is critical to the delivery of the Company’s existing services, maintenance of its competitive position, and the continued growth and diversification of its business. The Company is committed to the professional and operational development of its employees and encourages an ethos of individual responsibility and recognition. The Company believes that its open and accessible culture, as well as the competitive fringe benefits and support services that it provides, is a major factor in retaining its employees. Nearly all of the Company employees reside in Russia and Kazakhstan. The employees possess a strong combination of technical expertise and local knowledge accumulated on a large number of fields in most of the oil and gas regions in Russia and Kazakhstan. Many employees have been in the business since 1991, and have thus developed expertise in a wide range of services the Company renders.

The Company’s operating subsidiaries have in place workers’ collective agreements, which stipulate terms of employment, remuneration, incentives and social benefit. Part of the employees’ remuneration is variable in that it is determined by a number of performance indicators.

The Company is a socially responsible employer and contractor with a commitment to operate up to high health, safety and environment (“HSE”) standards. The Company continues to seek to ensure that its em-ployees are aware of, and take individual responsibility for, HSE matters in an environment in which such matters are regarded as a high priority. The Company believes that high safety standards are important not only for its employees but for maintaining its reputation and ability to win and retain significant contracts (be-cause the Company is required to comment on HSE in the tender process for the award of new contracts). Its operations and procedures have received ISO 9001 certification.

wORKiNg CAPiTAL

wEighTEd AvERAgE

hEAdCOUNT

iNCREASEd 10.0% yOy

ORgANizATiON

ANd PERSONNEL

38

C.A.T. OiL Ag 2013


The Company’s operations are subject to a number of environmental laws and regulations that govern the composition of emission discharged into the atmosphere, water use, wastewater discharge, the use, han-dling and disposal of chemical substances and hazardous materials and other matters. The Company’s operations also involve hazards inherent to the oil and gas production industry, such as blowouts, explo-sions, gas leaks and fires, oil spills and other accidents that can cause material damage to the environment.

The Company attaches high importance to the protection of the environment against pollution and other damages. Therefore, the Company’s operational companies strictly observe the national environmental laws and regulations in Russia and Kazakhstan. Moreover, the Company also observes its customers’ ad-ditional environmental requirements at their production sites, which sometimes exceed applicable require-ments of the environmental laws and regulations.

3. OUTLOOK ANd RiSK REPORTiNg

3.1. OUTLOOK

Russia’s economic growth continues slowing down as witnessed by the GDP growth of only 0.8% YoY in Q1 2014, according to preliminary estimate by the Russian Ministry of Economic Development. Feeble economic growth caused by decelerating investments and consumption was further aggravated by the in-creased capital flight amid geopolitical tensions over the Crimean crisis in Q1 2014. As a result, the Russian rouble weakened 8.4% against the euro to EUR 49.1 roubles/euro as of 31 March 2014 from 45.0 roubles/euro as of 31 December 2013. Based upon the first quarter economic data readings, the Ministry of Eco-nomic Development in early April cut the 2014 forecast GDP growth to 0.6% YoY from a previous projection of 2.5% YoY. The Russian government expects the consumer price inflation to slow down to around 6.0% YoY in 2014.

In contrast to the slowing Russian economy, the global economic growth is likely to accelerate in 2014. According to the IMF’s January 2014 World Economic Outlook report, global GDP growth is forecast to step up to 3.7% in 2014 from 3.0% in 2013 due to the strengthening economies in the US and the euro areas. According to the International Energy Agency’s March 2014 report, the world’s 2014 oil consumption is expected to reach a new historic peak of 92.7 million barrels per day, up 1.5% YoY or 1.4 million barrels per day compared to the 2013 level, as the macroeconomic backdrop improves. The IEA market data also point to easing tightness in oil supply driven by a steep rise in the non-OPEC output and, therefore, an upside risk to oil inventories and a downside risk to oil prices in coming periods. Nonetheless, the current strength in oil price combined with a pro-active attitude to production management by the leading OPEC nations support projections for the 2013 average Brent price of around USD 100 per barrel (Bloomberg consensus, March 2014).

Oil and gas taxes represent approximately 50% of Russia’s total federal budget revenues and as much as 10% of the nation’s GDP, according to the Finance Ministry data. To mitigate the risk of the budget revenue decline in the wake of deteriorating productivity of the oil sector asset base in the long run, the government has recently granted the sector tax incentives for supplementary production. The government initiatives, which primarily extend to offshore and onshore greenefield projects, unconventional and conventional tight resources and viscous oil plays, aim at bolstering the sector’s protracted investment cycle and bringing these new opportunities to development. According to VTB Capital Research, Russia’s top six oil majors

ENviRONmENTAL

COmPLiANCE

mACROECONOmiC

ENviRONmENT ANd OiL

PRiCE CONSENSUS

PROTRACTEd UPSTREAm

iNvESTmENT CyCLE

39

C.A.T. OiL Ag 2013


should increase their 2014 investments by 11% YoY to more than USD 55 billion with the lion share of the incremental spendings intended for upstream projects. Along with maturing brownfields in Western Siberia, the new projects require more advanced technologic solutions to reverse oil producers’ moderating efficien-cy and returns. Therefore, the outlook for a strong growth in demand for more complex and service intense horizontal drilling and multi-stage fracking remains positive, and the Company sees good prospects for the 2014 operating activity levels surpassing the last year records.

Strong tailwinds in the Russian OFS market are witnessed by a high pace of growth in the Company’s order book for 2014 and beyond. As of 23 April 2014, the Company’s rouble-denominated service orders inflated by 27% YoY to RUB 19.9 billion for the current year and 71% YoY to RUB 36.2 billion for a three-year period of 2014-16 (26 April 2013: RUB 15.7 billion and RUB 21.2 billion, respectively). The high pace of the business expansion is however obscured by a significant devaluation of the Russian rouble against the euro in Q4 2013 – Q1 2014. In euro terms, the Company’s order book staged only a 6% YoY appreciation to EUR 415 million (assuming the average rouble-to-euro exchange rate of 48) for 2014 compared to EUR 392 million (assuming the average rouble-to-euro exchange rate of 40) for 2013 a year ago. Respectively, the order book for a three-year period of 2014-16 was up 42% YoY to EUR 754 million (the order book for 2013-15: EUR 530 million). The share of the service orders beyond a 12-month period rose to 46% of the Company’s total three-year order book from 26% a year ago on the back of customers’ growing concerns over availabil-ity of operating capacities in the longer run.

The Company expects the 2014 revenues in the range of EUR 420 to 450 million and EBITDA ranging from EUR 113 to 121 million (based on the average rouble-to-euro exchange rate of 48). The Company’s guidance for 2014 resides upon the awarded service orders, sustainable operating efficiency and cost conscientiousness.

Having set up the new drilling service in 2012 and expanded its sidetracking and fracking capacities in 2013, the Company has embarked on the new capital expenditure program of EUR 390 million for 2014-16. With the three-year growth capital expenditures of EUR 300 million and the balance due to maintenance capex, the program is meant to expand operating capacities by 33% for fracturing, 55% for sidetracking and 170% for drilling by the end of 2016 compared to the end of 2013. The planned capacity additions are of a transformative nature as far as the Company operations are concerned: the service job count should attain a three-year compound annual growth rate of 9-10% for fracturing, 16-18% for sidetracking and 36-38% for drilling. The program is expected not only to enhance the Company’s business scale but also translate into more uniform business mix.

For 2014, the Company allocated approximately EUR 135 million out of the program’s total of EUR 390 million. The Company has already placed orders for manufacturing of the new rigs and fleets in order to expand its operating capacities by approximately 10% for fracturing, 18% for sidetracking and 67% for drilling by the end of 2014 compared to the end of 2013. The new rigs and fleets will be successively put in operations in Q3-4 2014.

FAST PACE OF gROwTh

iN SERviCE ORdERS iS

CLOUdEd by ThE

ROUbLE dEvALUATiON

REvENUE ANd EbiTdA

gUidANCE FOR 2014

2014-16 CAPiTAL

ExPENdiTURE PROgRAm

OF EUR 390 miLLiON

iS ON TRACK

40

C.A.T. OiL Ag 2013


3.2 RiSK mANAgEmENT

C.A.T. oil AG serves as an executive holding company for its subsidiary companies. One of the holding com-pany’s core responsibilities is to identify and actively manage the Group’s strategic and operational risks and develop and implement timely counter-measures to minimize identifiable risks. To this end, C.A.T. oil AG developed the Group-wide Opportunities and Risk Management System and has documented the system in the Group’s Risk Management Handbook since 2005. The system is an essential part of the Group’s business planning, and controlling processes.

The Board of Management has empowered its Chief Operating Officer (COO) to act as the Group’s Chief Risk Manager (CRM), a focal point for the Group’s risk reporting on a regular and an ad-hoc basis. This appointment has enabled the Management Board to obtain access to all risk-related information at any time in order to identify and assess various risk events, take appropriate actions, and respond to different developments and scenarios.

The CRM-led risk management system has a three-tier structure to share responsibilities between the hold-ing company and the subsidiaries and is organized as follows:

• The Moscow-based Executive Board of Directors is in charge of the Group’s risk management in Russia and the CIS. The Board reports directly to the Group’s CRM. The Board collects monthly reports from the subsidiaries’ General Directors, holds regular meetings with the subsidiaries’ General Directors and, where required, with key executives and employees in order to assess, change, and improve the subsid-iaries’ risk situation and counter-measures.

• General Directors are responsible for risk management at the subsidiary level and report directly to the Executive Board of Directors. General Directors appoint Risk Coordinators at subsidiaries, collect monthly reports and regularly interact with Risk Coordinators and key employees on various risk matters. In case of urgency, General Directors are accessible by risk coordinators at any time.

• The subsidiaries’ Risk Coordinators typically includes the Deputy General Director for Finance and Con-trolling, Deputy General Director for Sales and Marketing and Deputy General Director for Operations as well as senior officers at various departments. Risk Coordinators report directly to General Directors. Risk Coordinators identify, classify, and monitor risks, document risks and maintain risk registrars. They work out and propose counter-measures for approval by General Directors. Risk Coordinators also assess potential damages, which may arise from specific risks, observe internal guidelines and directives and ensure the system’s functionality and reliability.

41

C.A.T. OiL Ag 2013


3.3 RiSK FACTORS ANd RiSK mEASUREmENT

RiSKS ARiSiNg FROm ThE gROUP COmPANiES

The Company is exposed to material financial risks, which may arise in case of recurrence of the global economic and financial crisis, as its activities and operations are predominantly in the commodity-driven economies such as Russia and Kazakhstan. The Russian and the Kazakh government monetary policies and economic actions may have a significant risk impact affecting the Group’s net assets, financial position, and results of operations. Measures aiming at strengthening the Russian government control over oil and gas extraction industries may indirectly affect the service providers in the region. Potential adverse change in exchange rate of the Russian rouble or the Kazakh tenge against the euro, the Group’s reporting curren-cy, may also have a direct impact on the Group results of operations. Therefore, the Group-wide Opportu-nities and Risk Management system addresses financial risks and enables to develop counter-measures to mitigate these risks to maximize profits and minimize losses, should the risks actually occur.

A reversal of the global economic recovery and potential deterioration of the operating environment may also result in the full or partial impairment of certain assets or goodwill in case the expected business per-formance cannot be met. This could have a significant impact on the Group’s financial results.

The oil and gas field service markets, in which the Group companies operate, remain highly competitive. Competitive factors in the Group’s markets include contractors’ service quality and technical proficiency as well as delivery of services on an “as needed and where needed” basis. Further, the Group depends on a small number of significant customers. During the reporting period, the Group’s top five customers accounted for 94.7% of the total revenues, and the Group’s largest customer, Rosneft, represented 37.2% of the total revenues (2013: 44.9%). The Group companies’ risks primarily relate to non-fulfillment of the Group companies’ operating objectives and commitments that could potentially lead to a loss of a significant cus-tomer and, therefore, the risk of a material decline in revenues.

The Group’s risk management, reporting, planning, and controlling systems and functions are in place to raise the risk awareness of the Group’s management and employees and counter these risks. These systems also enable seamless information flow between operating divisions of the subsidiaries and the subsidiaries’ management and well as between C.A.T. oil AG and the subsidiary management.

The Group companies’ competitiveness is maintained by continuous innovations, quality control and assur-ance measures, and the deepening scale and scope of services with core customers. Customers’ oppor-tunity cost of switching from the Group services to other service providers are relatively high due to years of cooperation, the Group’s proprietary technology and know-how as well as deep working knowledge of Russian and Kazakh oil and gas fields.

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C.A.T. OiL Ag 2013


LiqUidiTy RiSKS

The Group liquidity risk includes its ability to meet the financial obligations, for instance in respect to trade payables or interest-bearing liabilities. In order to assess the liquidity risk, the budgeted operating, financial and investment cash inflows and outflows are analyzed on a monthly basis throughout the Group and the budgeted net liquidity is compared with the factual results. This analysis covers the existing financial invest-ments and financing facilities, their planned maturities, as well as available liquidity reserves. The Group’s financial decisions regarding the capital requirements are also made upon this analysis. Consequent to the economic and financial crisis developments in 2008-09 and, therefore, relatively scarce funding options, the Company reinforced its control over the liquidity risk and maintained a very conservative financial policy during the reporting period.

In the meantime, the Group has maintained the committed credit lines to enable the Group’s solvency and financial flexibility at any time. However, given the Company’s strong balance sheet and ample liquidity as of 31 December 2013, the Group has taken no further actions to enhance its liquidity.

No risks are currently discernible that would threaten the existence of C.A.T. oil AG.

3.4 NOTEwORThy RiSKS OF ThE gROUP

mARKET RiSKS

The demand for the Group’s services is sensitive to the level of exploration, development and production activity and capital spending by oil and gas companies in general. In the aftermath of the global economic crisis, oil and gas prices were seen well below their 2008 peak and high current levels. Potential reversal of the global economic recovery trend and, therefore, softer oil and gas prices may result in the Group customers’ lower upstream activities. As a result, the Group operating subsidiaries may get exposed to higher downside risks to their service job count and prices and, thus, the Group’s consolidated revenues and earnings may deteriorate.

The Group operates predominantly in Russia and Kazakhstan and services all the major oil and gas groups in the region. Hydrocarbons production volumes are often defined by producers’ long-term strategic plans and sometimes by international contracts. Near-term, an important mitigation against the market risks in-cludes the Group’s significant exposure to national oil and gas groups such as Gazprom and Rosneft, which have demonstrated greater resilience of their upstream activities and budgets to the energy price cycle downturns compared to their private peers. Since the 2006 IPO, the Group has also made significant investments in new state-of-the art fracturing, sidetracking and conventional drilling operating capacity. Thus, the Group is well placed with the most modern equipment and technology available in Russia and Kazakhstan and is in a position to defend and grow its market share. Stronger growth in global demand for oil and gas production going forward should also support sustainable demand growth for the Group’s services.

43

C.A.T. OiL Ag 2013


The Group’s risks are also attributable to political changes in Russia and Kazakhstan. As of today, the risk is deemed immaterial and covered by the Group’s risk management system. A quantifiable noteworthy market risk does not exist.

Fluctuations in market prices for the Group services may have a significant impact on the Group cash flow and profits. Consequent to a steep downturn in oil prices in the second half of 2008 and a negative impact of the financial crisis development, prices for the Company services were exposed to considerable down-ward pressures in 2009. However, the oil price recovery in 2010-11 paved the way for improvement in prices for the Company core services.

The Group’s future success depends, among other factors, on its ability to obtain new service orders. In some cases it is difficult to predict the time when an order, for which a Group company has submitted a bid, will be awarded. The awards of contracts may be affected by events beyond the scope of the Group influ-ence, such as, for instance, energy prices, demand for the Group services, general economic environment, customers’ ability to obtain the required permits and licenses, and availability of funding at a reasonable cost. In such cases the awards of contracts may be delayed and some of the Group customers may even decide to nullify tenders.

The Russian government views the oil and gas sector as the national heritage and a matter of strategic importance. Therefore, there is the risk that the state‘s influence and control over the sector could further increase. The Group’s customer structure is diversified, as far as the market, which consists of a limited number of large oil and gas producers, allows for.

No other potential threats are discernible because of the stable political conditions in the regions of the Group operations, coupled with reasonable judicial protection of foreign investments.

RiSKS OF NON-PAymENT

The Group’s risk management system makes it possible to recognize contingent losses on receivables and potential risks of non-payment at an early stage. The Group companies always perform thorough creditworthiness checks on new potential customers before taking them on. Also, the Group’s existing cus-tomer base, which is dominated by financially strong major oil and gas groups in Russia and Kazakhstan, enables it to minimize risks of non-payment. While the Group maintains reserves for potential credit losses, the reserves could appear not sufficient enough to meet write-offs of uncollectible receivables, should the Group’s customers’ cash flows be affected negatively by prolonged adverse changes in economic and industry conditions.

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FOREigN CURRENCy RiSKS

The Group’s reporting currency is the euro. Almost all of the Group’s revenues and expenses are in the Russian roubles and partly in the Kazakh tenges. Fluctuations in exchange rates between the euro, the rou-ble and the tenge will affect the translation of the Group’s financial results into the euro. Further, instability in exchange rates between the US dollar, the euro and the rouble may impact the Group’s supply costs, in particular for operating equipment and machinery. Movements in exchange rates may also affect the Group’s consolidated balance sheet. Finally, exchange rate fluctuations may cause the Group to record foreign currency gains and losses, since the Group currently does not hedge any of the resulting foreign exchange risks by way of derivative hedging transactions.

LEgAL ANd OThER RiSKS

On 02 February 2011 Caterpillar Inc., Peoria, Illinois, USA instituted a legal action against C.A.T. oil AG be-fore the district court of Hamburg for the alleged trademark infringement in Germany regarding the use of the brand CAT oil, C.A.T. oil energy in motion, etc. On 27 September 2013 Caterpillar Inc. brought a trade-mark law action in Canada of the same tenor. At present the Management Board is conducting negotiations on a trademark agreement with Caterpillar. By the balance sheet day, it was not possible to achieve an agreement. Apart from this, the management of C.A.T. oil AG believes that the Company is well positioned to contest the legal action, should the parties fail to conclude an agreement.

Apart from that, currently no legal risks exist and no litigation is pending. Legal risks that may arise from the operational business are sufficiently covered by existing insurance policies.

4. miSCELLANEOUS

4.1. diSCLOSURE ACCORdiNg TO 243A, SEC 1 ACC

C.A.T oil AG share capital amounted to EUR 48,850,000 as of 31 December 2013 (31 December 2011: EUR 48,850,000) and is divided into 48,850,000 no-par-value issued and outstanding shares. The shares are listed on the Prime Standard, Official Market, on the Frankfurt Stock Exchange. All of the shares are admit-ted for trading. No preferred shares have been issued. There are no restrictions regarding voting rights or transmission rights of the shares. C.A.T. oil AG has not acquired any of its own shares to date.

Following sale of 6,000,000 shares or a 12.282% stake in C.A.T. oil AG by CAT. Holding (Cyprus) Ltd., a majority shareholder, through an accelerated book building process in December 2013, a CAT. Holding (Cyprus) Ltd. reduced its stake in C.A.T. oil AG to 23,300,000 million shares or 47.697% of total shares out-standing from 29,300,000 million shares or 60% of total share outstanding before. Since September 2008, the Company COO Anna Brinkmann has directly acquired a total of 5,367,036 shares, which represent 10.987% of total shares outstanding. The remaining 41.316% of total shares outstanding is free float.

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Since its successful IPO in 2006, C.A.T oil AG has voluntarily adhered to the German Corporate Governance Code. Apart from a few constrictions, which are revealed in the Company’s compliance statement, the Code recommendations have been fully observed.

4.2. diSCLOSURE ACCORdiNg TO 243A, SEC 2 ACC

iNTERNAL CONTROL SySTEm

The definition of the essential characteristics, of the monitoring and control of the Internal Control System (ICS) and the Risk Management System (RMS) is based on the five components of the COSO Framework.

gOALS ANd ObjECTivES The Group controlling function aims at perfection of the Group corporate governance standards and im-provement of the Group companies’ operating and financial performance. The Group controlling operates in line with common principles and provides for value and earnings management, security and efficient use the Group assets, reliability and completeness of the Group companies’ financial, accounting, budgeting and management accounting data and reporting. The group controlling also ensures that the Group com-panies comply with internal policies, standards and procedures of operations and meet the requirements of the applicable civil and tax legislations.

The Group controlling combines organizational structures and controlling measures, methods and proce-dures, which are executed by the Group Management Board, the Audit Committee and the Moscow Exec-utive Board of Directors as well as the Group companies’ management, audit commissions, internal audit divisions and authorized employees.

The Group controlling is subject to a regulatory authority on all issues of controlling and accounting and the authorization to issue instructions to ensure the adoption of uniform standards throughout the Group. Process manuals have been created in the form of Group and the individual company guidelines to aid in implementation. These include the manual of the Group companies’ accounting under Russian GAAP, the Group IFRS accounting manual, the Group budgeting manual and the Group budgeting calendar, the Group companies’ inventory ordinance, manual for circulation of documents, HSE manual and other man-uals and internal instructions.

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UNdERLyiNg PRiNCiPLES ANd KEy COmPONENTS

The Group controlling underlying principles include functional continuity, accountability of all the parties of the controlling system and the regulated endorsement and approval procedures. These also reside upon segregation of responsibilities related to approval, accounting, inventory and security of activities with the Group assets. All the financial and economic activities of the Group companies require approvals by the authorized persons within their competence and responsibility.

The key components of the Group controlling function are the controlling environment, risk assessment and management, the controlling activities, dataware and exchange of information, monitoring and oversight.

The controlling environment includes the Group policy and employees’ ethic values and competence, allo-cation of responsibilities, organizational structure as well as guidance and leadership of the Management Board and the Moscow Executive Board of Directors. Risk assessment and management enables to identi-fy, analyze and mitigate risks, relating to the Group companies’ operating, financial and economic activities, in line with principles and procedures of the Group Opportunities and Risk Management System.

The controlling activities consist of procedures for segregation, confirmation, endorsement, sanctioning and authorization as well as checks and internal controls of day-to-day operations and provision of se-curity of assets. Dataware and exchange of information are intended to timely and efficient identification, registration and exchange of data and information to ensure awareness of and compliance with the Group controlling policy and procedures by all the related parties. This component of the Group controlling also secures against an unauthorized access to the Group data and information. Monitoring and oversight al-lows to gauge the efficiency of the Group controlling system and evaluate probability of errors, which might impact the Group financial and accounting reports.

PARTiES TO ThE gROUP CONTROLLiNg ANd RESPONSibiLiTiES

Parties to the Group controlling are the Management Board, the Audit Committee, the Moscow Executive Board of Directors, the Group companies’ management, audit commissions, internal audit divisions and authorized employees. Primary responsibility for the Group companies controlling stays with the Moscow Executive Board of Directors, which reports to the Management Board.

The Executive Board of Directors defines lines of development and strategy of the controlling system, out-lines structure and composition of internal audit divisions and sets goals and objectives for internal audit divisions. The Executive Board of Directors regularly reviews and analyses data and reports compiled by internal audit divisions, the Group companies’ management and audit commissions as well as information obtained from other sources and the Board’s own observations. These reports cover all the aspects of the controlling and include operating, financial and accounting control, checks of compliance with the existing legislation and internal policies and procedures. The Executive Board of Directors regularly reports to the Management Board upon the results its analysis of the Group companies’ reports and its assessment of reliability and efficiency of the controlling system.

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The Group companies’ audit commissions are responsible for provision of reliable information for the Group companies’ annual reports. The Group companies’ audit commissions perform annual audits prior to ap-proval of the Group company annual reports based upon their own checks and the results of external audit. The Group companies’ management is responsible for efficient functioning of the controlling system at the individuals companies. The Group companies’ management establishes and ensures the individual company employees’ compliance with duties and responsibilities, outlines organizational structures and reporting lines. The Group companies’ management verifies financial and economic data of the individual company organizational departments and divisions, transactions with counterparties, banks, leaseholders, etc. The responsibilities of the individual companies’ management also include confirmation of analytical accounts and turnover balance sheets as well as accuracy of the book entries. The Group companies’ management provides for budgeting, execution of the approved budgets, performs deviation analysis and controls the individual company profit and losses, cash flows, assets and liabilities. The Group companies’ management also ensures security of the individual company assets, makes regular inventories, sets re-strictions to the individual company assets and enables confidentiality of sensitive data and information. The individual company employees, including managers of organizational departments and divisions, take direct actions in the controlling procedures.

In order to ensure systematic control over the individual companies’ operating, financial and economic ac-tivities, the Group has established an internal audit division, which reports directly to the Executive Board of Directors. The Group internal audit division has an authority to obtain from the individual companies at any time any information related to financial and economic activity, including confidential information. An inquiry by the Group internal audit division is mandatory for the Group companies’ management and employees.

bUdgETiNg, mANAgEmENT ACCOUNTiNg, iNTERNAL ANd ExTERNAL REPORTiNg

The Group’s controlling is based on the Group companies’ budgets and financial results as well as the Group consolidated budgets and financial results. Budgeting for the subsequent fiscal year begins in Au-gust-September when the Group customers’ conclude their working programs for the coming year and ends with versioning in January-February upon completion of tendering campaign. Medium-term planning also forms part of budget planning.

The Group companies’ accounting and reporting divisions regularly report to the Executive Board of Direc-tors, which in turn regularly reports to the Group Managing Board, on business developments at C.A.T. oil. They monitor and report on the processes for planning, budgeting, reporting, deviation analyses and goals controlling, the monthly, quarterly and annual financial statements in line with the Russian GAAP and the IFRS requirements.

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The accounting, reporting and controlling division of the individual Group companies provide the individual Group company management with monthly reports. Once these have been approved, they are then passed onto the Group internal audit division for further processing and aggregation. Then the aggregated reports are presented to the Executive Board of Directors where they are discussed with the Group companies’ management and jointly considered with the Managing Board for decision making purposes. These ag-gregated monthly reports include the income statement and cash flow statement and key figures in accor-dance with the local GAAP and IFRS on the basis of the year-to-date and on a full year basis in comparison with the previous year and the budget containing deviation analyses, in addition to noteworthy highlights, as well as disclosures on earnings potential, achievement of goals, etc. Besides, the reports look at execu-tion of investment program and financing risk monitoring. Risk management gives an overview of the risk situation for the reporting period and the following periods as well as the impact of the main individual risks to the companies together with the proposed mitigations.

Quarterly external reporting to the Supervisory Board relates to the accounting process, which is the main feature of internal quarterly reporting, but also includes a general report on the economic environment in the oil and gas filed services industry. Further external reports to the Supervisory Board include the annual report and the Managing Board report on the annual budget, including the finance, liquidity and investment plans.

FiNANCiAL ACCOUNTiNg

Financial accounting is carried out in 1C. Stocktaking and disposal of assets are the responsibility of the local inventory managers at the individual subsidiary level. Their roles are stipulated in the Group compa-nies’ inventory ordinance. Additions to non-current assets are entered into 1C and are checked against the approved investment plans on a monthly basis. Depreciation and amortization of non-current assets is automated in 1C.

Bank entries are posted on a day-to-day basis. Creditor payment lists for all companies managed in 1C are created once a week, checked and transferred by the finance department by telebanking. Payments are posted only when so arranged by the financial accounting department and after being signed by two parties with no exceptions. Payment can then take place.

The 1C main document entry is responsible for checking, entering and payment preparation of all invoices. Accounts payable enters all invoices and payment orders from various creditors. This area attaches partic-ular importance to checking legal requirements, sales and corporation tax data and the Group internal reg-ulations such as the payment instructions for signing authorization and value limits. The Group companies’ accounting in line with the Russian GAAP is carried out by the accounting staff in the accounting department in close coordination with Group controlling.

On a quarterly basis, the Group companies’ financial accounting departments perform transformational procedures on their Russian GAAP financials and prepare the IFRS packages. Once these have been finalized, they are then passed onto the Group IFRS reporting division for examination. Following approval by the Group IFRS reporting division, these are forwarded for consolidation, which is outsourced to A2C Treuhand GmbH Wirtschaftsprüfungsgesellschaft, the related party, in Hamburg.

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iT SySTEmS

1C system is used for financial accounting. For budgeting and managerial accounting and reporting the Group uses Oracle Hyperion Planning system, which has been implemented and efficiently exploited by the Group companies since 2009.

All original documents are filed and archived in the document management system in a paper form as per the manual for circulation of documents.

4.3 NOTEwORThy EvENTS OF SigNiFiCANCE AFTER ThE bALANCE ShEET dATE

Recent geopolitical tensions over the Ukrainian crisis and accession of Crimea to the Russian Federation have had no meaningful direct impact on C.A.T. oil’s operations and business activities in the Russian Fed-eration until the time of preparation of financial statements for 2013 and publication of the Annual Report. Political risks however may exacerbate, should sanctions against the Russian Federation by the United States and the European Union get broadened going forward. At the time of the Annual Report publication, a downward pressure on the Russian rouble in the wake of macroeconomic and geopolitical factors has been intact since the middle of 2013.

5. EvENTS AFTER ThE bALANCE ShEET dATE

On 03 April 2014 C.A.T. oil AG and CAT. Holding Ltd. signed the agreement of a prolongation of the EUR 100 million credit line until 31 December 2018.

Vienna, 17 April 2014

Management Board

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C.A.T. OiL Ag 2013

ANNUAL REPORT 2013 | CORPORATE gOvERNANCE

CORPORATE gOvERNANCE

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CORPORATE gOvERNANCE REPORT

Corporate governance is of high importance to C.A.T. oil beyond its obligations to fulfil the requirements of the applicable legal regulations. It is the duty of the Company’s Management Board and Supervisory Board to manage and control the Company in accordance with national and international standards. The aim is to secure the continued existence of the Company and create sustained added value for the shareholders.

C.A.T. oil is a publicly-listed Company limited by shares with registered office in Vienna, Austria. The appli-cable principles of corporate governance are therefore those under Austrian law, in particular stock corpo-ration law and the laws governing capital markets, as well as the Articles of Association of C.A.T. oil AG. Due to the fact that the shares of the Company are quoted on the Frankfurt stock exchange, the Company is also bound to observe the laws governing the German capital markets, in particular the laws governing the admission of shares to the capital markets.

In order to ensure a high degree of transparency and clarity for all persons participating in the capital mar-kets, the Company’s Management Board and Supervisory Board decided in 2006 to apply the German Corporate Governance Code.

The basis for this report is the German Corporate Governance Code in the version as of 13 May 2013, which can be downloaded at www.corporate-governance-code.de.

ThE ExECUTivE bOdiES OF C.A.T. OiL Ag

Upon submission of proof of shareholding (§10a of Stock Corporation Act [AktG] and §16 of the Articles of Association), the shareholders are entitled to exercise their rights, in particular their voting rights, at the Annual General Meeting. Each share in the Company entitles the holder to one vote. There are no multiple or preferential voting rights and there is no cap on the number of voting rights. All information on the convening of the Annual General Meeting and all reports and information required for the resolutions to be voted upon are published pursuant to the applicable regulations of law on stock companies and made available on the website of C.A.T. oil AG (www.catoilag.com) in both German and English languages.

The Annual General Meeting is exclusively entitled to vote on various key resolutions, such as e.g. on the appropriation and the use of the balance sheet profit, on the discharge of the members of the Company’s Management Board and Supervisory Board, on the selection of the members of the Company’s Supervi-sory Board and on the appointment of the annual auditor. Furthermore, the Annual General Meeting also resolves on issues such as amendments to the Articles of Association of the Company corporate actions.

FUNCTiONS OF SUPERviSORy bOARd ANd mANAgEmENT bOARd

Pursuant to the applicable legal provisions, the Company is managed on the basis of a dual board system characterised by a strict personnel separation of management and supervisory executive body. According to this system the day-to-day management of the Company is conducted by the Management Board, whilst the Supervisory Board is monitoring the activities of the Management Board. It is not permissible to simul-taneously be a member of both executive bodies.

ANNUAL

gENERAL mEETiNg

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Members of the Supervisory BoardDr. iur. h.c. Gerhard Strate, Chairman of the Supervisory Board, born 1950, date of initial appointment: 26.09.2005.

Dr. jur. Manfred Zacher, Deputy Chairman, born 1946, date of initial appointment: 26.09.2005.

Mirco Schroeter, born 1968, date of initial appointment: 13.03.2006.

Dr. Walter Hoeft, born 1957, date of initial appointment: 15.06.2012.

For all aforementioned members of the Supervisory Board the current terms expire on the date of the Annual General Meeting resolving on the matter of formal approval for the 2016 financial year.

Except for Dr. Walter Hoeft, who is a member of the Supervisory Board of the company Dauerholz AG, Dabel (Germany), the members of the Supervisory Board do not perform further Supervisory Board functions in domestic or foreign companies.

The Supervisory Board of C.A.T. oil AG observes the principles of impartiality, as set out in the German Corporate Governance Code. With the exception of Mr Mirco Schroeter and Dr. Walter Hoeft, all Supervi-sory Board members are completely impartial. In its current composition, the Supervisory Board fulfils all requirements for impartiality. The Supervisory Board of C.A.T. oil AG has, except for Dr. Walter Hoeft, no members that are shareholders in the Company with a shareholding of more than 10%. Furthermore, no former member of the Management Board is currently a member of the Supervisory Board.

The Supervisory Board supervises and advises the Management Board during the course of the manage-ment of the Company. The bylaws of the Company regulate the individual tasks and responsibilities and the convening, scheduling and chairing of the meetings of the Supervisory Board. The Supervisory Board reserves rights of consent regarding all matters of vital importance to the Company.

The tasks of the Supervisory Board include the appointment and dismissal of members of the Management Board and the awarding of the salaries of the Management Board. Furthermore, the Supervisory Board also audits the Annual Financial Statements and Consolidated Financial Statements and reports to the Annual General Meeting on the results of the audit.

The Supervisory Board has formed an Auditing Committee, which is responsible in the name of and on behalf of the Supervisory Board for fulfilling the auditing duties assigned to it, insofar as this is legally per-missible. The formation of this Committee is obligatory under Austrian law.

The Auditing Committee is concerned with topics as accounting, risk management, control systems, com-pliance and the auditing of the Annual Financial Statements. At least once a year the Auditing Committee discusses in cooperation with the Management Board and the annual auditor the effectiveness, functionality and appropriateness of the control system and risk management system. In addition, interim reports are discussed with the Management Board prior to publication and audits of the Annual Financial Statements and Consolidated Financial Statements of C.A.T. oil AG are conducted. The current members of the Audit Committee, Dr. Strate and Mr Schroeter, are financial experts and have professional experience and knowl-edge of the application of accounting principles and internal control procedures.

SUPERviSORy bOARd

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The independence of the Supervisory Board is subject to the conditions on independence set out in the German Corporate Governance Code. In accordance with these conditions, the Supervisory Board is inde-pendent if it has no business relations with the Company. The following Supervisory Board members are deemed independent:

Dr. Gerhard StrateDr. Manfred Zacher

The member Mirco Schroeter is a managing director of the company A2C Treuhand GmbH Wirtschaftsprü-fungsgesellschaft, Hamburg, which carries out services for the Company.

The member Dr. Walter Hoeft is the sole shareholder of Coraline Limited, Nicosia, Cyprus, the ultimate par-ent company of the Group. He holds 23.97% of the shares of C.A.T. oil AG indirectly through this company.

Manfred Kastner, born 1962, Chairman of the Management Board, initial appointment November 2005, expiry of term 31.12.2018As a member of the Management Board responsible for key company functions as strategy, personnel, marketing and public relations.

Ronald Harder, born 1963, Deputy Chairman of the Management Board, initial appointment November 2006, expiry of term 31.12.2018As a member of the Management Board responsible for finance and accounting, legal affairs and internal control system.

Anna Brinkmann, born 1957, member of the Management Board, initial appointment November 2005, expiry of term 31.12.2018As a member of the Management Board responsible for operative business, production and controlling.

Leonid Mirzoyan, born 1966, member of the Management Board, initial appointment March 2007, expiry of term 31.12.2018As a member of the Management Board responsible for central planning, strategic planning, corporate finance and investor relations.

Supervisory Board mandates of Management Board members outside the CompanyManfred Kastner:Vision Microfinance Fund, Luxemburg, Director of the Board

All matters of fundamental or significant importance require the approval of all members of the Manage-ment Board. The Management Board follows all Company bylaws and guidelines issued by the Supervisory Board, regulating the tasks and responsibilities of the Board members, in particular procedures of the deci-sion-making process, as well as provisions on the avoidance of conflicts of interest.

C.A.T. oil AG has effected a D&O insurance policy for all members of the Supervisory Board and Manage-ment Board. The insurance policy has no deductibles in the event of claims.

iNdEPENdENCE

mANAgEmENT bOARd

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REmUNERATiON OF SUPERviSORy bOARd ANd mANAgEmENT bOARd

C.A.T. oil AG follows the recommendations of the German Corporate Governance Code, stating that re-muneration of the Supervisory Board and Management Board should be disclosed individually for each member. The amount of remuneration awarded is disclosed in the remuneration report, which is part of the notes to the Consolidated Financial Statements.

mEASURES FOR ThE PROmOTiON OF wOmEN iN ThE mANAgEmENT bOARd, SUPERviSORy bOARd ANd mANAgERiAL ROLES (§243b ii 2. AUSTRiAN COmmERCiAL COdE [Ugb])

For many years C.A.T. oil has been pursuing the aim of promoting the diversity and variety of its employees with regards to qualifications, experience and age, cultural background, gender and other aspects. We place a particular emphasis on gender equality when selecting our employees. In numerous areas women have attained the necessary qualifications to assume managerial roles. Throughout the group women oc-cupy top level management positions in both the parent Company and its subsidiaries.

RiSK mANAgEmENT

The responsible treatment of risk is one of the fundamental principles of good corporate governance. The Management Board of C.A.T. oil AG and the managerial employees within the entire C.A.T. oil group have at their disposal comprehensive group and company-specific reporting and control systems for the monitor-ing, assessment and control of risks. These systems are being constantly developed and adapted to chang-ing framework conditions. Furthermore, these systems are regularly checked for efficiency and functionality by the annual auditor. The Management Board updates the Supervisory Board on a regular basis with infor-mation on all existing risks and their development. The Audit Committee is concerned in particular with the monitoring of accounting processes, including reporting, the effectiveness of the internal control systems, risk management, the internal audit systems, compliance and the auditing of the financial statements.

The risk report as a part of the annual report of C.A.T. oil contains further details on risk management within the group. The risk report also includes the obligatory report on the internal control and risk management systems for the accounting procedures.

TRANSPARENCy

C.A.T. oil informs the participants in the capital markets, interested parties and the general public immedi-ately, regularly and simultaneously of the current economic situation of the group. The management report, half year financial report and interim quarterly reports are all published within the time periods specified by the Frankfurt stock exchange. In addition, C.A.T. oil also informs interested parties of all events and new developments via press releases and if necessary ad hoc notifications. All information is made available si-multaneously in the German and English languages and is published in both printed format and via suitable electronic media such as e-mail and the Internet. The Company website www.catoilag.com also offers an extensive array of information on the C.A.T. oil group and C.A.T. oil share prices.

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FiNANCiAL CALENdAR

Our financial calendar offers a transparent overview of all scheduled dates of the important events and publications – for example the Annual General Meeting, Annual Report and interim reports. The calendar is published and made available on the C.A.T. oil AG website.

diRECTORS’ hOLdiNgS

In the 2013 financial year members of the Management Board and Supervisory Board (including all related parties pursuant to the applicable provisions of the law) conducted no dealings in shares in the Company, except for the single sale of 3,500 shares at the rate of EUR 8.745, i.e. in the total amount of EUR 30,607.50 on 18 February 2013 and for the private placement of 6 million shares on 11 December 2013 at the rate of EUR 18.00, i.e. in the total amount of EUR 108.0 million.

STATEmENT ON RECOmmENdATiONS OF ThE CORPORATE gOvERNANCE COdE:

Recommendation 2.2.4 section 2: In the interests of all participants in the Annual General Meeting, the targeted and efficient organizational procedure and guidance remains unchanged. A time limitation to a predefined number of hours is considered to be not appropriate. Shareholders and management of the Company use the Meetings to enter in dialog with each other and take up the time frame appropriate to the agenda items, without disregarding the principle of time-efficient procedure while chairing the Meeting.

Recommendation 2.3.3 section 2, paragraph 2: It is ensured that the Representative nominated by the Company is available by fax until the starting time of the Annual General Meeting. Considering the size of the Company, the possibility of following the Annual General Meeting via electronic communication media is currently not available as this would require a disproportionately high additional expense.

diRECTORS’ dEALiNgS

Shares as at 31 december 2013

Management Board 5,434,535

Manfred Kastner 60,000

Ronald Harder 7,500

Anna Brinkmann 5,367,035

Leonid Mirzoyan none

Supervisory Board 23,302,500

Dr. Gerhard Strate none

Dr. Manfred Zacher none

Mirco Schroeter 2,500

Dr. Walter Höft 23,300,000

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Recommendation 3.7 paragraph 3: In the event of takeover bid, the management considers it in principle advisable to convene an Extraordinary General Meeting, which offers the shareholders the opportunity to discuss and if applicable, to resolve on the matter according to corporate law.

Recommendation 5.1.2 paragraph 2/1: The recommendation to abstain from nominating new members of the Management Board for the maximum period of five years was already applied by the Company in the past.

dECLARATiON OF COmPLiANCE

C.A.T. oil AG is committed to the recognized principles of corporate governance. As a foreign issuer on the Frankfurt Stock Exchange with headquarters in Austria, C.A.T. oil AG resolved, in accordance with the Austrian Corporate Governance Code, to apply the German Corporate Governance Code. The Annual Declaration of Compliance pursuant to the German Stock Corporation Act (AktG) is an essential part of the German Corporate Governance Code.

declaration of Compliance of C.A.T. oil Ag with the recommendations of the german Corporate governance Code

C.A.T. oil AG (hereinafter the “Company”) is a company organized under Austrian law and subject to laws, rules and regulations in Austria. As such, the Company’s compliance with the recommendations of the German Corporate Governance Code (“Code”) is dependent on the Code’s compatibility with the Austrian laws, rules and regulations, which the Company is subjected to. The Management Board and the Super-visory Board of the Company hereby declare, without being legally obliged to do so, that the recommen-dations of the German Corporate Governance Code Government Commission (Regierungskommission Deutscher Corporate Governance Kodex) published by the German Federal Ministry of Justice in the official section of the electronic Federal Gazette have been and are being met, save from the recommendations listed below. Since the last Declaration, for the period from December 2012 until 10 June 2013 this Declara-tion refers to the recommendations of the Code, version of 15 May 2012, published on 15 June 2012 in the electronic Federal Gazette. Since 10 June 2013 this Declaration is in relation to the Code, version of 13 May 2013 with effect from 10 June 2013:

1.) Recommendation 3.8: The Company does not follow the Code’s recommendation on the introduction of a deductible in a reasonable amount in its D&O-insurance policy, as the Company does not expect any positive impact on the Management Board‘s and the Supervisory Board‘s performance of their duty of care and loyalty by introducing such deductible. In addition, the Company notes that deductibles in D&O-insurance policies are not widely used outside Germany and might hinder the recruiting of key personnel by the Company. The corresponding German laws are not applicable in Austria and thus the Company does not abide by this recommendation.

2.) Recommendations 4.2.3 and 7.1.3: The monetary compensation elements granted to the Company‘s Management Board members do neither comprise variable elements nor stock options or comparable instruments nor the participation in any pension schemes. Therefore, any recommendations as to stock options or comparable instruments (e.g., demanding or relevant comparison parameters, no retroactive changing of performance targets or comparison parameters, agreement on a cap for extraordinary, unforeseen developments) were not implemented. The Company is in the opinion that the Management Board‘s remuneration structure with solely fixed elements is of utmost transparency to its shareholders

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and the disclosure of the total amount of the Management Board‘s remuneration was up to this point suf-ficient to align the interests of the Management Board with those of the shareholders. Consequently, the Company‘s Compensation Report does not contain details about the value of specific stock option plans or similar long-term incentive and high-risk components of remuneration and details about payments in pension schemes. In addition the Company’s Corporate Governance Report does not disclose any stock option programs and similar security based incentive systems. In the event that stock option plans or programs for the Management Board should be implemented, the strict standards of the Corporate Governance Code shall be applied.

Currently the Company does not follow the Code’s recommendation to include a compensation cap in the employment contracts of Management Board members for the case if they would prematurely terminate their Management Board function without good reason. In future amendments to existing employment contracts or in new employment contracts of Management Board members, the Company shall aspire to follow this recommendation. In the event of Change of Control, the existing employment contracts of Management Board members include severance compensation for the agreed term of the respective employment contracts but at least for the duration of two years.

The corresponding German laws are not applicable in Austria and thus the Company does not abide by this recommendation.

3.) Recommendation 5.2 and 5.3.3: As the Supervisory Board does only comprise of four persons it has formed only an Audit Committee, the establishment of which is mandatory under applicable Austrian law. Due to the limited number of members, the Supervisory Board and the Company are in the opinion, that the constitution of further committees would not be appropriate and would not increase the efficiency of the Supervisory Board‘s work. For the same reason a Nomination Committee was not founded. There-fore, the Chairman of the Supervisory Board does not chair a committee that handles contracts with members of the Management Board. Notwithstanding the recommendation 5.2 section 2/2 pursuant to which Chairman of the Supervisory Board shall not hold the presidency of the Audit Committee, the Chairman of the Supervisory Board is also Chairman of the Audit Committee, this resulting on the one hand from the low number of members and on the other hand from the required professional qualifica-tions for this Committee.

4.) Recommendation 5.4.1 section 2 and 3: In the revised version of 26 May 2010 the German Corpo-rate Governance Code Government Commission (Regierungskommission Deutscher Corporate Gov-ernance Kodex) adopted new recommendations in respect of 5.4.1 section 2 and 3. Pursuant to these recommendations the Supervisory Board shall target specific objectives, which take into account the Company’s international operations, potential conflicts of interest, age limits for members of the Super-visory Board and diversity, considering the Company‘s specific situation. In particular, these specific objectives shall allow for appropriate participation of women. Nomination proposals of the Supervisory Board to the relevant nomination boards shall consider these objectives. The Company’s Corporate Governance Report shall reflect these objectives and the state of their realisation.

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C.A.T. OiL Ag 2013


The Company does not follow the recommendation to frame, consider and publish specific objectives. The constitution of the Supervisory Board shall secure an effective consulting and monitoring of the Man-agement Board corresponding to the Company’s interests. In order to ensure the dutiful performance of the tasks required by law the Supervisory Board will also in future nomination proposals primarily focus on the knowledge, skills and experience of the nominees. In addition, the Supervisory Board will take into account in appropriate manner the Company’s international operations, potential conflicts of interest, fixed age limits and diversity. The Supervisory Board considers the predefinition of specific objectives or gender-related quota regulations as neither necessary nor appropriate as this approach, especially for C.A.T. oil AG as a small stock-listed company, might in general limit the selection of qualified nominees. Accordingly, the Corporate Governance Report will not contain objectives in this respect.

5.) Recommendation 7.1.2: The Company‘s Consolidated Financial Statements are not publicly accessible within 90 days after the end of the financial year, nor are Interim Reports publicly accessible within 45 days after the end of the reporting period. This is due to the complex reporting requirements in Russia, Kazakhstan and other jurisdictions.


Management Board Supervisory Board

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C.A.T. OiL Ag 2013


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REPORT OF ThE SUPERviSORy bOARd

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C.A.T. OiL Ag 2013


For the first time, the investments in high class drilling contributed to the results to the full extent. With the increase in operating capacities by 30% for sidetracking and by 10% for fracturing C.A.T. oil continued fol-lowing its growth path during the reporting period. Revenues and profit document in an impressive way that the management focused on the profitable services just at the right time.

As of the end of 2013 15 hydraulic fracturing fleets, 22 sidetracking rigs and 9 high class drilling rigs were in use.

In the year under review the Supervisory Board fulfilled the duties conferred on it in accordance with statu-tory requirements and the Articles of Incorporation. The Supervisory Board also fulfilled its role of advisor to the Management Board on matters of company management and regularly monitored the company’s busi-ness. The Management Board regularly reported to the Supervisory Board in a timely manner on all relevant corporate planning matters and the Group’s business situation, including the risk situation. Deviations from planned business and corporate objectives were explained in detail. The Supervisory Board conducted quarterly reviews of financial expenses before publication and was kept informed of all audit activities and results. The Chairman of the Supervisory Board was in regular contact with the Management Board and received continuous information about the current business situation and material business events.

SUPERviSORy bOARd mEETiNgS iN 2013

The Supervisory Board held five meetings during 2013. It was also in regular telephone contact with the Management Board. Some resolutions were also passed by circular.

Generally, all the members attended the Supervisory Board meetings. Supervisory Board members re-ceived detailed and meaningful documents concerning all business matters requiring the Supervisory Board’s approval. A review of the Management Board’s report on the company’s sales, revenue and finan-cial situation as well as on the development of orderbook and investment activities formed an integral part of every meeting.

During its meeting on 14 March 2013, the Supervisory Board essentially concerned itself with the Group budgets as well as implementation and marketing of the new capacities.

Topics for the meeting on 25 April 2013 concerned the company’s annual financial statement and manage-ment report, as well as C.A.T. oil AG’s consolidated financial statement and group’s management report for 2012. Auditor BDO Austria GmbH Wirtschaftsprüfungs- und Steuerberatungsgesellschaft, Vienna, present-ed the audit report, reported in detail on the course of the audit and then answered related questions. After its own audit of the annual financial statement and management report as well as the consolidated financial statement and the Group’s management report, the Supervisory Board raised no objections and accepted the audit report, thus adopting the annual financial statement according to section 96 (4) Austrian Joint Stock Corporation Act (Aktiengesetz, AktG) and approved the consolidated financial statement.

REPORT OF ThE SUPERviSORy bOARd

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C.A.T. OiL Ag 2013


During its meeting on 14 June 2013, the Supervisory Board concerned itself with implementation of corpo-rate planning and roll-out of the new sidetracking rigs.

The new employment contracts of the Management Board and the appointment of the members of the Man-agement Board for a further period of 5 years was an essential topic of the meeting on 9 September 2013.

In the meeting on 11 November 2013, amongst other items the Supervisory Board took decisions concern-ing the investment program 2014-16, the amendments to the current applicable version of the German Governance Code, dated 13 May 2013, and an update to the Declaration of Conformity. The Declaration of Conformity is permanently available on C.A.T. oil AG’s website. Amongst other matters, this meeting also discussed the draft of the group‘s Code of Conduct.

SUPERviSORy bOARd COmmiTTEES:

In view of the Supervisory Board’s size, the Supervisory Board has refrained from forming a nominations and a remuneration committee, as their duties are to be performed by the Supervisory Board as a whole.

Over the course of four meetings and several teleconferences, the Audit Committee concerned itself with quarterly financial statements, the half-yearly financial statement, preparation for auditing of the annual financial statement and preparations for the resolution on adoption of the annual financial statement and consolidated financial statement, as well as with new editions of the Group‘s accounting and issuer com-pliance guidelines.

The Audit Committee reported to the Supervisory Board on its work at every Supervisory Board meeting.

The Audit Committee is composed of Dr. Strate (Chairman) and Mr Schroeter.

Further information about the Audit Committee’s composition and work, and its remuneration can be found in the Notes and the Corporate Governance Report.

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C.A.T. OiL Ag 2013


ANNUAL FiNANCiAL STATEmENT 2013

During the balance sheet meeting on 17 April 2014, the Supervisory Board looked at the 2013 annual finan-cial statement, the company’s management report, and the audit report by BDO Austria GmbH Wirtschafts-prüfungs- und Steuerberatungsgesellschaft, Vienna. The auditor provided a detailed report on the audit’s progress and then answered related questions.

The C.A.T. oil AG consolidated financial statement prepared according to IFRS and the Group manage-ment report for the 2013 financial year have been audited by BDO Austria GmbH Wirtschaftsprüfungs- und Steuerberatungsgesellschaft, Vienna, and given an unqualified audit certificate.

The consolidated financial statement prepared according to IFRS, the Group management report and au-ditors’ reports were presented to the Supervisory Board at the meeting on 17 April 2014. The auditors were present and gave a detailed report on the audits’ progress and comprehensively and exhaustively answered all questions in this regard.

Following its own audit of the annual financial statement, consolidated financial statement, management report and Group management report, the Supervisory Board had no objections and accepted the audit results.

The annual financial statement was thus adopted according to section 96 (4) Austrian Joint Stock Corpora-tion Act and the consolidated financial statement was approved. Furthermore, after review, the Supervisory Board approved the Corporate Governance Report prepared by the Management Board and the Manage-ment Board’s proposal on utilization of the balance sheet profit for distribution. It will be suggested to the General Meeting that a dividend of EUR 0.35 per share shall be paid for 2013.

The Supervisory Board then put a motion to the General Meeting, that BDO Austria GmbH Wirtschaftsprü-fungs- und Steuerberatungsgesellschaft, Kohlmarkt 8-10, 1010 Vienna, be appointed auditor for the annual and consolidated financial statements for the financial year ending 31 December 2014.

The Supervisory Board thanks the members of the Management Board and the Group’s employees for their dedication, which has contributed to our Company’s successful development.

Vienna, 17.04.2014

Dr. Gerhard StrateOn behalf of the Supervisory Board

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CONSOLidATEd FiNANCiAL STATEmENTS

C.A.T. OiL Ag 2013

ANNUAL REPORT 2013 | CONSOLidATEd FiNANCiAL STATEmENTS

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C.A.T. OiL Ag 2013


gROUP bALANCE ShEET

31.12.2013 31.12.2012Notes TEUR TEUR

ASSETS

Current assets

Inventories (1) 19,631 24,650

Trade accounts receivable (2) 73,483 72,930

Other short-term receivables (3) 3,503 2,736

Tax assets (4) 1,615 852

Cash and cash equivalents (5) 42,640 38,816

Non current assets

Property, plant and equipment (6) 196,051 213,591

Intangible assets (6) 621 6

Goodwill (6) 3,473 3,903

Investments (7) 292 326

Other long term assets (8) 347 131

Deferred taxes (9) 10,869 7,871

352,525 365,812

ShAREhOLdERS EqUiTy ANd LiAbiLiTiES

Current liabilities

Trade accounts payable (10) 45,514 35,879

Other current liabilities (11) 17,701 18,164

Current liabilities related company (12) 147 532

Advance payments received (13) 8 10

Income tax payable (14) 1,007 928

Non current liabilities

Deferred tax liabilities (9) 18,501 15,273

Non current liabilities related company (15) 17,900 50,054

Shareholders equity

Share capital (16) 48,850 48,850

Capital reserves (16) 111,987 111,987

Retained earnings (16) 153,455 114,827

Foreign currency exchange reserve (16) -62,545 -30,692

352,525 365,812

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C.A.T. OiL Ag 2013


gROUP iNCOmE STATEmENT

2013 2012Notes TEUR TEUR

Revenues (18) 426,583 334,235

Cost of revenues (19) -341,193 -277,212

gross profit 85,390 57,023

Other operating income (20) 905 827

General and administrative expense (21) -21,500 -21,398

Other operating expenses (22) -208 -734

Operating income 64,587 35,718

Interest income (23) 737 324

Interest expense (23) -1,882 -3,382

Foreign currency exchange loss (23) -739 698

Result before income taxes 62,703 33,358

Income tax (24) -12,062 -8,864

Net income excluding discontinued operations 50,641 24,494

Net income discontinued operations

Revenues (18) 0 2,537

Cost of revenues (19) 0 -5,514

gross profit 0 -2,977

Other operating income (20) 257 1,155

General and administrative expense (21) -237 -228

Other operating expenses (22) -35 -1,518

Operating loss -15 -3,568

Interest income (23) 5 27

Foreign currency exchange loss (23) 0 80

Result before income taxes -10 -3,461

Income tax (24) 209 0

Net income discontinued operations 199 -3,461

group result 50,840 21,033

basic earnings per share (EUR) (25) 1.041 0.431

diluted earnings per share (EUR) (25) 1.041 0.431

Earnings per share excluding discontinued operations (25) 1.037 0.501

Earnings per share discontinued operations (25) 0.004 -0.071

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C.A.T. OiL Ag 2013


CONSOLidATEd OThERCOmPREhENSivE iNCOmE

2013 2012

Notes TEUR TEUR

group result 50,840 21,033

items that may be reclassified to profit or loss

Currency translation (16) -14,160 4,080

Net investment (16) -17,693 6,018

Other comprehensive income -31,853 10,098

Comprehensive income 18,987 31,131

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C.A.T. OiL Ag 2013


gROUP CASh FLOw STATEmENT

Thereof: discontinued operations

2013 2012 2013 2012

Notes TEUR TEUR TEUR TEUR

Profit before income tax 62,693 29,897 -10 -3,461

Depreciation and amortization 50,373 47,879 0 765

Loss on disposal of fixed assets -421 405 -7 148

Change in inventories 2,572 1,761 0 0

Change in trade and other receivables -10,786 -3,589 946 1,289

Income taxes paid -11,295 -6,176 277 0

Change in trade and other payables 15,464 11,044 -886 -625

Other non cash income and expenses -1,203 2,666 0 1279

Net cash provided by (used in) operating activities 107,397 83,887 320 -605

Purchase of property, plant and equipment (6) -64,733 -37,730 0 -186

Proceeds from sale of equipment 2,666 2,399 0 341

Net cash used in (provided by) investing activities -62,067 -35,331 0 155

Change in short- and long-term debt and debt from related company

-32,512 -30,256 0 0

Interest paid and received (23) -993 -3,030 0 0

Dividends paid -12,212 -6,107 0 0

Net cash used in (provided by) financing activities -45,717 -39,393 0 0

Net effect of currency translations in cash and cash equivalents

4,211 -735 0 0

Net increase in cash and cash equivalents 3,824 8,428 320 -450

Cash and cash equivalents at 01.01 (5) 38,816 30,388 393 843

Cash and cash equivalents at 31.12 (5) 42,640 38,816 713 393

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C.A.T. OiL Ag 2013


Share

capital

Capital

reserve

Retained

earnings

Fx Reserve Net investment in

foreign country

Total

Anhang (16) (16) (16) (16) (16)

TEUR TEUR TEUR TEUR TEUR TEUR

Balance at 31.12.2011 48,850 111,987 99,901 -26,015 -14,775 219,948

Total comprehensive income 21,033 4,080 6,018 31,131

Dividends paid -6,107 -6,107

balance at 31.12.2012 48,850 111,987 114,827 -21,935 -8,757 244,972

Balance at 31.12.2012 48,850 111,987 114,827 -21,935 -8,757 244,972

Total comprehensive income 50,840 -14,160 -17,693 18,987

Dividends paid -12,212 -12,212

balance at 31.12.2013 48,850 111,987 153,455 -36,095 -26,450 251,747

STATEmENT OF ChANgES iN gROUP EqUiTy

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C.A.T. OiL Ag 2013

ANNUAL REPORT 2013 | NOTES TO ThE CONSOLidATEd FiNANCiAL STATEmENTS

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C.A.T. OiL Ag 2013


1. gENERAL iNFORmATiON

C.A.T. oil AG (hereinafter also referred to as “the Company”) is a company under Austrian law (FN 69011 m) with headquarters at the following address: 1010 Vienna, Kärntner Ring 11-13. The shares of the Company are officially traded on the Prime Standard at the Frankfurt Stock Exchange.

These consolidated financial statements of C.A.T. oil AG and its subsidiaries (hereinafter “the Group”) as at 31 December 2013 have been drawn up under the responsibility of the managing directors of the Company on 17 April 2014 and submitted to the Supervisory Board on the same day for approval. On 17 April 2014 the Supervisory Board granted its approval of the consolidated financial statements for disclosure in the Official Journal of the Wiener Zeitung and in the database of the Austrian Commercial Register.

The ultimate parent company of the Group is Coraline Limited, Nicosia, Cyprus, with its sole shareholder being Dr. Walter Höft. The direct parent company is CAT. Holding (Cyprus) Ltd.

The financial statements for the ultimate parent company are disclosed in the commercial register of Nico-sia, Cyprus.

The consolidated financial statements have been drawn up in both the German and English languages. The German language version is the original and prevailing version.

2. PURPOSE OF ThE COmPANy

The purpose of the Company is the holding of participating interests and the management of subsidiary companies.

The subsidiary companies shown on the consolidated financial statements are all, with one exception, registered in Russia and are all oil and gas field (OFS) service companies, predominantly in the fields of hy-draulic fracturing, sidetrack drilling, drilling and remedial as well as auxiliary services. Furthermore, in 2007 the Group ventured into engineering services and the reconnaissance of geological formations. For this purpose the C.A.T. oil Group founded one Russian and one Austrian subsidiary. The Russian company was deleted effective 14 August 2012. End of 2012 was resolved on and initiated the discontinuing operations of the Austrian subsidiary. Pending the preparation of the consolidated financial statements, the cessation of business was not yet complete.

3. ACCOUNTiNg PRiNCiPLES

LEgAL bASiS

The provisions of section 245a of the Austrian Business Enterprise Code [Unternehmensgesetzbuch, UGB] dictate that the consolidated financial statements are to be prepared on the basis of the applicable interna-tionally recognized accounting principles. As prescribed in the European Union pursuant to Regulation (EC) No. 1606/2002 of the European Parliament and of the Council on the application of international accounting standards, the consolidated financial statements of C.A.T. oil AG as at 31 December 2013 have therefore been prepared pursuant to the International Financial Reporting Standards (IFRS) guidelines issued by the International Accounting Standards Board (IASB) in the version valid on the balance sheet date.

NOTES TO ThE CONSOLidATEd FiNANCiAL STATEmENTS

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C.A.T. OiL Ag 2013

When preparing the consolidated financial statements, we have observed all applicable amendments to existing IAS, new IFRS and all IFRIC and SIC interpretations valid as at 31 December 2013 and compulsory within the European Union through adoption by national legislation.

In the 2013 financial year the following standards and interpretations have been applied for the first time:

Standard / interpretationPublished

by the iASbAdoption

into EU law mandatory application Expected effects

Presentation of Items of Other Comprehensive In-come (Amendments to IAS 1)

16.06.2011 05.06.2012 01.07.2012 Presentation other comprehensive income

Amendments to IAS 19 Employee Benefits

16.06.2011 05.06.2012 01.01.2013 No

IFRS 13 Fair Value Measurement

12.05.2011 11.12.2012 01.01.2013 No

Deferred tax: Recovery of Underlying Assets (Amendments to IAS 12)

20.12.2010 11.12.2012 Beginning of the first at or after the entry into force of Regulation financial year starting

No

Severe Hyperinflation and Removal of Fixed Dates for First-Time Adopters (Amendments to IFRS 1)

20.12.2010 11.12.2012 Beginning of the first at or after the entry into force of Regulation financial year starting

No

Disclosures - Offsetting Financial Assets and Financial Liabilities (Amendments to IFRS 7)

16.12.2011 13.12.2012 01.01.2013 No

IFRIC 20 Stripping Costs in the Production Phase of a Surface Mine

19.10.2011 11.12.2012 01.01.2013 No

Government Loans (Amendments to IFRS 1)

13.03.2012 04.03.2013 01.01.2013 No

Improvements to IFRSs 2009-2011

17.05.2012 27.03.2013 01.01.2013 No material effects


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C.A.T. OiL Ag 2013

The following IFRS/IFRIC had been published by the IASB and/or IFRIC, however not yet fully adopted by the EU and were not applied voluntarily before the effective date:


by the iASbAdoption


IFRS 10 Consolidated Financial Statement

12.05.2011 11.12.2012 01.01.2014 No

IFRS 11 Joint Arrangemnet 12.05.2011 11.12.2012 01.01.2014 No

IFRS 12 Dscloosures of Interest in Other Entities

12.05.2011 11.12.2012 01.01.2014 No

IAS 27 Separate Financial Statements

12.05.2011 11.12.2012 01.01.2014 No

IAS 28 Investments in Associates and Joint Ventures

12.05.2011 11.12.2012 01.01.2014 No

Offsetting Financial Assets and Financial Liabilities (Amendents to IAS 32)

16.12.2011 13.12.2012 01.01.2013 No

Transition Guidance (Amendments to IFRS 10, IFRS 11 and IFRS 12)

28.06.2012 04.04.2013 01.01.2014 No

Investment Entities (Amendments to IFRS 10, IFRS 12 and IAS 27)

31.10.2012 20.11.2013 01.01.2014 No

Recoverable Amount

Disclousures for Non-

Financial Assets

(Amendments to IAS 36)

29.05.2013 19.12.2013 01.01.2014 No

Novation of Derivatives

and Continuation of

Hedge Accounting

(Amendments to IAS 39)

28.06.2012 19.12.2013 01.01.2014 No


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C.A.T. OiL Ag 2013

The following standards and interpretations and amendments to existing standards, which were also issued by the IASB, are not yet mandatory for the consolidated financial statements as at 31 December 2013. Their application requires that they be accepted as part of the IFRS endorsement procedure (“Endorsement”) of the EU.

The planned first application will be the date of coming into compulsory effect.

CONSOLidATiON

The financial statements of all incorporated companies have been drawn up using uniform group-wide accounting standards with a common balance sheet date of 31 December.

The scope of consolidation includes all subsidiary companies of C.A.T. oil AG and their subsidiary compa-nies and is unchanged in comparison to the previous balance sheet date.

In addition to C.A.T. oil AG, as at 31 December 2013 five foreign and one Austrian subsidiaries were inclu-ded in the consolidated financial statements. C.A.T. oil AG holds either directly or indirectly 100% of voting rights in these subsidiaries.

SCOPE OF

CONSOLidATiON


by the iASbAdoption


IFRS 9 Financial Instruments and subsequent amend-ments (admendments to IFRS 9 and IFRS 7)

12.11.2009/ 16.12.2011

11.12.2012 pending No

Defined Benefit Plans: Employee Contributions (Amendments to IAS 19)

21.11.2013 Q3/2014 01.07.2014 No

Annual Improvment to IFRSs 2010-2012 Cycle

12.12.2013 Q3/2014 01.07.2014 No

Annual Improvment to IFRSs 2011-2013 Cycle

12.12.2013 Q3/2014 01.07.2014 No

IFRIC 21 Levies 20.05.2013 Q2/2014 01.01.2014 No


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C.A.T. OiL Ag 2013

The following table shows the companies included in the consolidated financial statements – in addition to the parent company – as at 31 December 2013:

Capital consolidation of the subsidiary companies included in the consolidated financial statements takes place using the revaluation method.

Upon first incorporation of a subsidiary company, consolidation takes place using the acquisition method via allocation of the acquisition costs to the identifiable assets and liabilities belonging to the company (including contingent liabilities). If the acquisition costs exceed the fair value of the net assets, the amount by which this value is exceeded is shown on the balance sheet as goodwill and subjected to annual impair-ment testing, unless there are other indicators or events that occur in the interim that indicate impairment to these assets.

During the course of debt consolidation all loans, trade receivables, other receivables, payments on ac-count and prepaid expenses from business relations between Group companies included in the consolida-ted financial statements were offset against the corresponding liabilities and/or reserves.

Intra-Group profit/loss from deliveries and services between Group companies shown on the consolidated financial statements were eliminated taking into consideration the materiality principle and any deferred taxes.

During the course of the consolidation of income and expenditure all income from deliveries and services and all other income from business relations between Group companies shown on the consolidated finan-cial statements (intra-Group sales) was offset against all incurred expenditure, taking into consideration the materiality principle.

CAPiTAL CONSOLidATiON

CONSOLidATiON OF dEbTS

ELimiNATiON OF

iNTRA-gROUP PROFiT

ANd LOSS

CONSOLidATiON

OF iNCOmE

ANd ExPENdiTURE

Name Registered office Group share capital

Voting rights held

Main field of business

OOO CATKoneft Kogalym, Russia 100 100 OFS

OOO CATOBNEFT Nizhnevartovsk, Russia

100 100 OFS

OOO C.A.T. oil Trading House

Kogalym, Russia 100 100 Trade

OOO C.A.T. oil Leasing Kogalym, Russia 100 100 Leasing

OOO C.A.T. oil Drilling Kogalym, Russia 100 100 OFS

C.A.T. GEODATA GmbH Vienna, Austria 100 100 Engineering and reconnaissance of geological formations


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C.A.T. OiL Ag 2013

mEThOdS OF ACCOUNTiNg ANd vALUATiON

The consolidated financial statements have been drawn up in Euro. All figures, including the figures for the previous year, are given in thousands of euro (TEUR). This may lead to rounding differences.

Assets and liabilities were classified as short-term if it was anticipated that these could be realized or settled within twelve months after the balance sheet deadline.

The income statement has been drawn up according to the internationally recognized cost of sales method.

For the purposes of clarity, on the balance sheet and income statement certain individual items have been condensed; this is explained in more detail in the notes.

If necessary, the individual balance sheet items shown on the individual financial statements of the subsi-diary companies have been adjusted in order to bring the methods of accounting and valuation in line with the accounting principles employed by the Group.

The financial statements have been drawn up under application of the going concern principle.

The amounts shown on the consolidated financial statements have been determined solely on the basis of a commercial presentation of the position of the company with regard to assets, finances and earnings pursuant to the IASB guidelines and are totally uninfluenced by fiscal regulations.

The consolidated financial statements have been drawn up using the same uniform accounting and valua-tion methods as for the financial statements as at 31 December 2012.

Revenue from services provided is recognized as soon as the service has been performed. Revenue from the sale of goods (this concerns to a small extent the sale of chemicals) is recognized as soon as the risks and rewards associated with ownership have been transferred to the purchaser. Revenues are valuated at fair value of received or to be received consideration and reduced by all trade discounts, sales taxes and other taxes connected with the sale or services performed. Revenues are not recognized in case of existing substantial risks regarding recovery of the consideration.

Revenue from and expenses of service orders were partially calculated on the basis of the percentage of completion method. This allowed sales revenue to be shown according to the degree of completion of services. The percentage of completion is measured on the basis of the ratio of the service output as at the balance sheet date to the total output. This is the case when the outcome of a transaction involving the rendering of services can be estimated reliably.

Interest income is recognized pro rata temporis taking into consideration the outstanding amount of capital and the applicable interest rate.

REALizATiON

OF REvENUE


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C.A.T. OiL Ag 2013

The cost of sales includes all costs incurred as a result of operation (incl. staff costs and cost of materials), maintenance and repair, as well as depreciation on machinery used during the rendering of services.

The administrative costs include personnel and material costs.

Monetary items in foreign currencies are valuated at the exchange rate as at the balance sheet date, where-by any exchange rate profits and losses are shown with effect on income. The assets and liabilities shown in foreign currencies on the individual financial statements of the companies within the C.A.T. oil Group are valuated at actual daily exchange rate. Any exchange rate profits and losses are also shown with effect on income.

Financial statements drawn up in foreign currencies by subsidiary companies included in the Group con-solidated financial statements are translated on the basis of functional currency pursuant to IAS 21 (Effects of changes to foreign exchange rates) using the modified closing rate method. Due to the fact that transac-tions are conducted predominantly in the Russian rouble, the functional currency of the Russian subsidiary companies is the Russian rouble. The functional currency of the Austrian subsidiary is the euro.

At balance sheet date in the consolidated financial statements expenses and income from the financial statements of subsidiaries that are drawn up in foreign currencies are translated using the average exchan-ge rate for the year. Assets and liabilities are translated using the mean rate of exchange. The items of the consolidated cash flow statement are translated using the average exchange rate for the year. Cash and cash equivalents are translated using the mean rate of exchange.

Currency translation differences from the translation of various items of the balance sheet and income statements are shown in other income and therefore recognized in the foreign currency reserves with no effect on income.

The following exchange rates have been used for the translation of the relevant foreign currencies to euro:

mATChiNg OF ExPENSES

FOREigN CURRENCiES

Russian Rouble (RUB) for EUR 1

2013 2012

Income statement (average) 42.313 39.958

Balance sheet (end of year) 44.970 40.227

Kasakh Tenge (KZT) for EUR 1



US Dollar (USD) for EUR 1




79

C.A.T. OiL Ag 2013

In drawing up the consolidated financial statements pursuant to IFRS it has been necessary for the ma-nagement of the Company to make certain discretionary judgements on the suitability of particular methods of accounting and valuation and to make certain assumptions on the future development of the Company. These judgements concern the assets and liabilities, contingent liabilities, income and expenditure shown on the consolidated financial statements, as well as the figures shown in the notes. Actual results may differ from these estimates and assumptions. Although the management assumes that the estimates concer-ning the relevant expected useful lives of assets, the assumptions concerning the economic framework conditions and the development of the branch of industry in which the Company is active and estimates concerning discounted future cash flows are appropriate, changes to such estimates and/or assumptions or changes to circumstances may require changes to the analysis. This could lead in future to additional im-pairment requirements or to a reversal of impairments if the predicted trends were to reverse or if estimates or assumptions were to prove incorrect.

The estimates and underlying assumptions are reviewed at regular intervals. In comparison to the previ-ous reporting period there have been no significant changes to estimates, unless otherwise stated in the relevant section of these notes. Estimates are based on historical experience and further factors including expectations for future events, which appear to be reasonable in the present situation.

The impact of the change in an estimate is recorded with effect on income in the financial statements for the period in which the change was made. If applicable the figures for the previous year are also to be amended accordingly.

All estimates are made to the best of the management‘s knowledge and belief and with the aim of presen-ting a true and accurate picture of the situation of the Group with regard to assets, finances and earnings.

Estimates, with corresponding risk, are made in particular with regard to the following matters:

• Impairment tests of goodwill, other intangible assets and property, plant and equipment and other assets is based on estimated of the recoverable amount of the assets. Recoverable amount is deter-mined for an individual asset, unless the asset generate cash inflows that can be generated only with other assets or with cash-generating units. In addition, a cash-generating unit to which goodwill has been allocated shall be tested for impairment annually. The recoverable amount is based on an estimate of fair value less costs to sell and value in use. A fair value measurement assumes that the asset is exchanged in an orderly transaction between market participants to sell the asset at the measurement date under current market conditions. The estimate of the price is based on these market conditions As part of a fair value hierarchy according to IFRS 13 fair value is primarily to be determined from quoted prices on active markets, otherwise from comparative market values and possibly in a third step, derivable from market values. Costs of disposals are to be estimated in accordance with IAS 36. The value in use is determined by discounting expected future cash inflows and outflows to be derived from continuing use of the asset or cash-generating unit with a risk-adjusted discount rate

ESTimATES ANd

ASSUmPTiONS


80

C.A.T. OiL Ag 2013

• The valuation-relevant cash flows are derived from plans being presented at the time of conducting the impairment tests present current plans and the market environment.The cash flows relevant to the valuati-on are derived from current planning and the current market environment. Planning is based on collected experience, recent operating results and the best possible estimates of the management of the Company on the future development of individual influencing factors, for example commodity prices, profit margins and other comparable factors, including market assumptions. These include, for example, the develop-ment of the economy and market growth, which we analysed taking into account external macroeconomic and industry-specific sources.

• The discount rates have to reflect the assumption that match those of the estimated cash flows. Both components must be free from distorting influences, which can not be associated with the asset. A range of possible outcomes should be provided.

• The multi-year plan covers the period until 2017. For the remainder period a growth rate of 1% was as-sumed. The risk-adjusted pre-tax discount rate of 12.2% (previous year: 11.5%) takes into account the conditions of the Russian market and rouble.

• The discount rates are based on the weighted average cost of capital (WACC) and were determined ba-sed on the capital asset pricing model (CAPM), and current market expectations.

• Amendments to estimates could lead in future to additional impairments, however also to the reversal of impairments if the trends identified by the management are reversed or if the assumptions and estimates made should prove in the future to be inaccurate.

• deferred taxes: In order to ascertain the recoverability of deferred taxes, an audit of the deferred tax assets is conducted in order to establish whether it is probable that they can be realized in the future. Their feasibility is largely dependent on the future taxable earnings generated by the companies within the Group. If the Company fails to generate sufficient taxable income, deferred tax assets cannot be formed. On the basis of the expected future tax results, the management assumes the realizability of deferred tax assets. Deferred tax assets may be reduced if the estimated planned taxable income is reduced, e.g. fol-lowing changes to fiscal legislation, however also through fiscal structuring within the legally permissible possibilities.

• For more details on the formation of deferred taxes, please see the information on income in this section.

• Rendering of services: Revenues from the rendering of services within a single period or over more than one period is recognized in accordance with IAS 18. The outcome of a transaction can be estimated reli-ably when the amount of revenue, stage of completion and the costs incurred can be reliably measured until the end of the business and the feasibility of the revenues are secured. The recognition of revenue and related costs are then followed by the corresponding provisions of IAS


81

C.A.T. OiL Ag 2013

• Determining the economic useful life of property, plant and equipment: Property, plant and equip-ment is valuated at acquisition or production cost less scheduled depreciation. The period over which de-preciation is carried out is dependent on the predicted economic useful life. Upon commencement of use, assets contained in the asset class property, plant and equipment are depreciated pro rata temporis. The residual book value, the useful life and the depreciation method for the assets is examined at least every balance sheet date. If expectations differ to earlier estimates, the changes set out in IAS 8 – changes in accounting estimates and errors – are implemented for assets capitalized in previous years.

• Taxes: The C.A.T. oil Group is active primarily in Russia and Kazakhstan and is therefore answerable to various tax authorities. The management assumes that it has made a reasonable estimate of the uncer-tain tax liabilities. However, due to the uncertainty with regard to tax liabilities, it cannot be guaranteed that the estimates made will actually be accurate. Any deviations to estimates may have an impact on actual tax liabilities and/or deferred taxes in the year in which taxes are accrued. In this respect we also examine whether it is sufficiently probable that future tax benefits will exist in order to warrant the accrual of deferred taxes. This requires amongst other factors an assessment of tax advantages by the management.

Intangible assets and property, plant and equipment with an useful life of more than one year are recog-nized as assets at acquisition cost or production cost and, insofar as subject to depreciation, recognized less accumulated depreciation and accumulated impairments. Scheduled depreciation is recorded on a straight-line basis. Ongoing maintenance costs for property, plant and equipment are recognized immedi-ately as expenditure. Production costs do not include borrowing costs. Subsequently arising acquisition or production cost is recognized as a part of the acquisition or production cost for an asset or as a separate asset when it is probable that in future economic benefits will flow to the Group and the cost can be mea-sured reliably.

In the event of the sale or retirement of assets, the acquisition or production cost and the corresponding accumulated depreciation on the assets is written off the balance sheet; any incurred profit or loss is reco-gnized immediately with effect on income.

The useful life of intangible assets is between three and five years. From a Group viewpoint, these assets are seen as insignificant. They include largely purchased software programs.

Depreciation on property, plant and equipment is recorded throughout the Group over the estimated useful life of the assets as follows:

iNTANgibLE ASSETS

wiTh ThE ExCEPTiON

OF gOOdwiLL ANd

PROPERTy, PLANT ANd

EqUiPmENT

Buildings 5 to 33 years

Plant and machinery 1.5 to 11 years

Operational and office equipment, data processing equipment

1.5 to 11 years

Vehicles 2 to 7 years


82

C.A.T. OiL Ag 2013

On each balance sheet date the Company examines in particular the carrying amounts of goodwill and property, plant and equipment in order to ascertain whether there is any indication of impairment. If there is indication of impairment, the recoverable amount of the asset is determined in order to ascertain the extent of depreciation to be carried out. There were no indications of required impairment in the year under review.

Goodwill annual impairment test is carried out each year on 1 July. This also applies if there are no indica-tions of impairment. Goodwill is allocated to the cash-generating units that are expected to benefit from the synergies of the combination.

An asset (or a cash generating unit) is impaired if the carrying amount exceeds the recoverable amount of the asset (or the cash-generating unit). If an asset does not generate any cash inflows, the recoverable amount is determined for the smallest identifiable group of assets (cash-generating unit) to which the corre-sponding asset can be allocated. These cash-generating units represent the lowest organizational level at which the management supervises goodwill for internal management purposes. The impairment testing of assets is carried out at the level of these units and on the basis of the estimates made by the management.

The recoverable amount corresponds to the higher of either fair value less costs to sell or value in use. If either of these amounts exceedes the asset´s carrying amount, the asset is not impaired and it is not neces-sary to estimate the other amount.

Impairment is recognized with effect on profit and loss and is shown separately on the income statement and in the segment reporting. If, after impairment has been carried out, it is later determined that the asset or cash-generating unit has a higher value, a reversal of impairment is carried out up to the value of the recoverable amount. The impairment reversal is limited to the amortized carrying amount that would have been valid without impairment. Impairment reversals have effect on profit and loss and are recognized un-der other operating income.

Pursuant to IFRS 3, goodwill arising from capital consolidation (business combinations) since the 2004 financial year is recognized at acquisition cost as an asset, however not made subject to scheduled amorti-zation. Rather, impairment tests are to be carried out pursuant to IAS 36. Impairment tests are to be carried out at least once each year or if there are internal or external indications for impairment. Impairment losses are to be recognized if the carrying amount is higher than the recoverable amount. A subsequent reversal of impairment losses is not permissible.

The existing goodwill is the result of the acquisition of CATOBNEFT. The goodwill represents the amount by which the acquisition cost of the Group‘s interest exceeds the fair value of the identifiable assets, liabilities and contingent liabilities of CATOBNEFT.

The impairment test of goodwill involves a comparison of the recoverable amount of a cash-generating unit and the carrying amount including goodwill. If the recoverable amount is less than the carrying amount of the cash-generating unit, the goodwill is initially to be amortized; any remaining impairment will lead to pro rata reductions in the carrying amounts of the other assets. In the event of the sale of CATOBNEFT, the goodwill will be taken into account when determining the sale price.

imPAiRmENT OF

iNTANgibLE ASSETS,

gOOdwiLL ANd

PROPERTy, PLANT

ANd EqUiPmENT

gOOdwiLL


83

C.A.T. OiL Ag 2013

A financial instrument is a contract that gives rise to a financial asset for one entity and to a financial liability or equity instrument for another entity. A financial instrument is recognized if the C.A.T. oil Group is a cont-racting party to a financial instrument.

The primary financial instruments of the Group are predominantly financial assets such as employee loans, other financial assets, trade accounts receivable, bank balances, short-term and long-term payables to banks and trade accounts payable. These financial instruments are valuated at amortized acquisition cost.

As at the balance sheet date, there was no valuation of financial instruments at fair value.

Impairment is carried out if there are objective indications for impairment requirements, e.g. significant financial difficulties of the debtor, detrimental changes to a debtor‘s creditworthiness or significant changes to the technological, market, economic or legal circumstances.

The amount of depreciation of a financial asset valuated at amortized acquisition cost is based on the difference between the carrying amount and the present value of expected cash flows, discounted by the original effective interest rate of the financial asset. Impairment losses are recognized with effect on profit and loss. If the amount of impairment is reduced in subsequent periods on the basis of events that objec-tively occur after the event leading to impairment, impairments already carried out are reversed with effect on profit and loss.

For the valuation criteria within the individual categories, please refer to the following notes on the individual items on the balance sheet.

According to IFRS 5.13, non-current assets that are to be abandoned shall not be classified as held for sale. Gain or loss and cash flows shall be presented as discontinued operation at the time, when they are not any more held for use, if the following criteria are met: a discontinued operation represents a separate major line of business or is part of a single coordinated plan to dispose of or abandon a separate major line of business.

In second quarter of 2012, the C.A.T. GEODATA activities in Assam / India have been suspended due to political instability. Since the situation and order volume did not improve by 31 December 2012, the ma-nagement resolved end of 2012 on the final discontinuing the operations of C.A.T. GEODATA. Gain or loss and cash flows of the discontinued operation are presented separately.

FiNANCiAL

iNSTRUmENTS

diSCONTiNUEd

OPERATiONS


84

C.A.T. OiL Ag 2013

The shown financial assets are classified as “held for sale” and recognized at acquisition cost pursuant to IAS 39.46. The classification of these assets as “held for sale” is the result of the fact that these assets are neither held to maturity, nor valuated at fair value with effect on income and do not fall into the category “loans and receivables”.

The financial assets include shares in a cooperative association under Russian law. Membership of this co-operative association is for the purpose of the execution of banking transactions. The shares have not been traded on stock markets since 2004, meaning that it is impossible to determine a market value.

No derivative financial instruments are employed.

Inventories are measured at of cost of inventories using the average cost method and if necessary, at the lower net realisable value at the balance sheet date. Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale.

The production costs include all directly attributable costs, as well a reasonable proportion of the materials overheads and production overheads at normal capacity of the respective production machinery, insofar as these costs are incurred in connection with production. The cost of company pension schemes, statutory and voluntary social security contributions and general administration costs may also be taken into consi-deration, to the extent that they are attributable to production. Pursuant to IAS 23, borrowing costs may not be included in production costs because no qualifying assets exist.

Receivables and other assets are shown at nominal amount or acquisition cost, if necessary less appropri-ate impairment losses in separate allowance accounts. Impairment losses carried out adequately take into account the expected default risk. Actual defaults lead to derecognition of receivables. Whether default risk is accounted for through allowance account or derecognition, depends on the certainty of the bad debt.

Trade receivables and the other financial assets fall into the category “loans and receivables”.

Cash includes cash on hand and bank balances. Cash equivalents include short-term, extremely liquid financial investments that can be converted into cash quickly, i.e. within three months, and that are not sub-ject to any significant risk of changes in value; they are recognized at amortized cost.

Foreign currency risks exist primarily in the exchange relationship between Russian rouble and US dollars due to procurement transactions. These risks are however controllable through financial and liquidity planning.

OThER FiNANCiAL ASSETS

(AvAiLAbLE FOR SALE)

dERivATivE FiNANCiAL

iNSTRUmENTS

iNvENTORiES

RECEivAbLES ANd

OThER ASSETS

CASh ANd CASh

EqUivALENTS


85

C.A.T. OiL Ag 2013

The foreign currency reserve is the result of the translation of the financial statements of the Group’s foreign subsidiaries from functional currency to the reporting currency. Furthermore, the foreign currency reserve also includes the translation of net investments in foreign operations. For more detail, please refer to the section “Foreign currencies”.

Payments that must be made by the Company pursuant to the Russian statutory pension ordinance are recognized by the subsidiaries as expenditure in the period in which payment is made. There are no sever-ance payments or other payments after the end of employment relations, meaning that no such expenditure is to be recognized.

Financial liabilities are obligations to deliver cash or other financial assets to another entity. These include trade accounts payable and bank loans and overdrafts.

Both interest-free and interest-bearing liabilities are recognized at the amount actually incurred, taking into account any possible transaction costs. Subsequent valuation of the other liabilities is carried out at amor-tized cost.

Classification is to the category “financial liabilities which are valuated at amortized cost”.

Other liabilities are valuated using the same methods as the financial liabilities. This item includes in parti-cular tax liabilities, deferred liabilities and received payments on account.

Income tax expenditure is the sum of ongoing income tax expenditure and deferred taxes.

Current tax is determined on the basis of the taxable income of the individual companies taking into consi-deration the applicable national taxation regulations and the applicable tax jurisdictions. Due to the comple-xity of these computations, it is possible that there may be differences of opinion between the taxable entity on the one hand and the local tax authorities on the other.

Pursuant to the balance sheet liability method for tax deferral set out in IAS 12, deferred taxes are formed for temporary differences between the carrying amounts of assets and liabilities on the IFRS consolidated financial statements and the tax base at a company level. Deferred tax liabilities and assets are formed for temporary differences that lead to tax burdens or deductible tax credits when calculating taxable income for a future period. Differences determined in this way are always taken into consideration if they lead to defer-red tax liabilities. Tax benefits that are probably realizable and that result from unused loss carryforwards are taken into consideration when determining deferred taxes. Goodwill resulting from the initial consolidation of subsidiary companies may not lead to the formation of deferred taxes. A further exception from the for-mation of deferred taxes is temporary differences pertaining to the valuation of investments in subsidiaries, insofar as these do not arise from depreciation with effect on taxation.

EqUiTy

PENSiONS ANd

PAymENTS AFTER

ThE ENd OF EmPLOymENT

RELATiONS

FiNANCiAL LiAbiLiTiES

OThER LiAbiLiTiES

iNCOmE TAxES


86

C.A.T. OiL Ag 2013

Unused tax losses are recognized on the balance sheet via the formation of deferred tax assets in the amount in which it is probable that taxable income will be generated in the future for the offsetting of losses. When determining the amount of deferred taxes, all known positive and negative influences on future taxab-le income are taken into consideration.

Deferred tax assets and deferred tax liabilities are valuated on the basis of prevailing taxation rates applica-ble in the period in which it is expected that the asset can be realized or the liability discharged. If the ma-nagement believes that deferred tax assets can no longer or no longer fully be used, impairment is carried out to the extent required.

Deferred taxes are recognized with effect on profit and loss, except in cases in which the taxes pertain to business transactions or events that are recognized directly in other comprehensive income and therefore under equity.

This item contains changes to equity that have no effect on income, insofar as these do not concern ca-pital transactions with shareholders. This item includes in particular foreign currency translations from int-ra-Group loans, which are qualified since 2008 as net investment in foreign operations. Other comprehen-sive income includes only components that will be reclassified subsequently to profit or loss when specific conditions are met. Other comprehensive income includes no related tax effects.

Contingent liabilities and assets are not shown on the balance sheet, unless these are to be recognized as part of a company acquisition.

Contingent liabilities and receivables are disclosed in the notes if the possibility of an outflow of resources with economic benefits is not improbable. Contingent assets are not recognized, details are presented in the notes if the influx of economic benefits is probable.

OThER

COmPREhENSivE iNCOmE

ThE APPLiCAbLE

iNCOmE TAx RATES ARE:

CONTiNgENT LiAbiLiTiES

ANd ASSETS

2013 2012

Austria 25% 25%

Russia 20% 20%

Kazakhstan 28% 28%


87

4. NOTES TO ThE bALANCE ShEET

Inventories are recognized individually at acquisition cost or if applicable, at the lower of acquisition cost or net realizable value. Impairment provisions at net realizable value are formed according to IAS 2.28 et seqq.

The acquisition of inventories takes place predominantly via C.A.T. oil Trading House.

Inventories are realized within a period of less than one year.

Written down to net realisable value in the reporting period amounted to TEUR 13 (2012: TEUR 312) and reversals of written down in the amount of TEUR 116 (2012: TEUR 71) resulted from higher net realisable values. In addition, both in the reporting period and in the previous year changes to inventories were reco-gnized as expenditure.There were no inventories given as a collateral during the reporting period or the previous year.

The impairment provisions have developed as follows:

As in the previous year, the residual term to maturity of trade accounts receivable is less than one year. The value of receivables due for more than one year has been fully adjusted. There were no receivables overdue which have not been adjusted. There were no indications of other possible value adjustments, especially regarding doubtful receivables. The management assumes that trade receivable which are neither overdue nor relief measured will retain their value.

Income from receivable written down amounted to TEUR 1 (2012: TEUR 70).

(1) iNvENTORiES

(2) TRAdE ACCOUNTS

RECEivAbLE

C.A.T. OiL Ag 2013

31.12.2013 31.12.2012

TEUR TEUR

Raw materials 13,719 16,894

Supplies 3,537 5,606

Spare parts and other materials 2,375 2,150

19,631 24,650

2013 2012

TEUR TEUR

Carrying amount of value adjustemt at 01.01. 2,246 2,123

Additions (through profit or loss) 54 165

Reversal/use of value adjustment -2,117 -117

Foreign currency translation adjustments -92 75

Carrying amount of value adjustment at 31.12. 91 2,246

31.12.2013 31.12.2012

TEUR TEUR

Trade account receivable 73,483 72,930

73,483 72,930


88

C.A.T. OiL Ag 2013

The value adjustment of the other receivables in the reporting period in comparison to the previous year was as follows:

As in the preceding year, the residual terms to maturity of other short-term assets are less than one year. Overall, receivables are not overdue. The values of assets more than one year overdue have been fully adjusted. There were no indications of possible further impairment.

There was no revenue from impaired other receivables either in the year under review or in the previous year.

The cash and cash equivalents amount to TEUR 42,640 at the balance sheet date (31 December 2012: TEUR 30.816).

As in the previous year, the term of cash and cash equivalents is less than one year. The item cash and cash equivalents corresponds to the amount shown as liquid funds on the cash flow statement. Restricted cash and cash equivalents no longer exist. In the previous year, guarantees amounting to TEUR 350 as collateral for the C.A.T. GEODATA GmbH were under limited availability.

(3) OThER

ShORT-TERm ASSETS

(4) TAx RECEivAbLES

(5) CASh ANd

CASh EqUivALENTS

31.12.2013 31.12.2012

TEUR TEUR

Value added tax 1,812 565

Advance payments 1,371 1,782

Accrued accounts payables 160 229

Other receivables 160 160

3,503 2,736

31.12.2013 31.12.2012

TEUR TEUR

Income tax receivables 1,483 800

Other tax receivables 132 52

1,615 852

2013 2012

TEUR TEUR

Carrying amount of value adjustemt at 01.01. 60 62

Additions (through profit or loss) 8 32

Reversal/use of value adjustment -25 -37

Foreign currency translation adjustments 30 3

Carrying amount of value adjustment at 31.12. 73 60


89ANNUAL REPORT 2013 | NOTES TO ThE CONSOLidATEd FiNANCiAL STATEmENTS

Cos

t to

acq

uire

ass

ets

Acc

umul

ated

dep

reci

atio

nb

ook

valu

e

01.0

1.20

13A

dditi

ons

Fore

ign

curre

ncy

diffe

renc

esD

ispo

sals

31.1

2.20

1301

.01.

2013

Add

ition

sFo

reig

n cu

rrenc

y di

ffere

nces

Dis

posa

ls31

.12.

2013

31.1

2.20

13

TEU

RTE

UR

TEU

RTE

UR

TEU

RTE

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TEU

RTE

UR

TEU

RTE

UR

TEU

R

Tang

ible

ass

ets

Land

and

bui

ldin

gs15

,648

1,19

9-1

,601

-585

14,6

616,

805

1,50

1-6

97-4

047,

205

7,45

6

Mac

hine

ry a

nd e

quip

men

t, in

clud

ing

vehi

cles

20,5

311,

301

-1,0

82-1

,805

18,9

4516

,919

1,03

4-6

92-1

,691

15,5

703,

375

Oil

field

equ

ipm

ent

328,

237

51,5

58-3

3,80

0-1

8,95

132

7,04

414

2,75

447

,576

-13,

906

-17,

054

159,

370

167,

674

Equi

pmen

t ele

ctro

nic

data

pro

cess

ing

1,14

622

5-1

11-1

421,

118

830

171

-79

-89

833

285

Adv

ance

pay

men

ts15

,337

1,92

40

017

,261

00

00

017

,261

Sum

mar

y38

0,89

956

,207

-36,

594

-21,

483

379,

029

167,

308

50,2

82-1

5,37

4-1

9,23

818

2,97

819

6,05

1

inta

ngib

le a

sset

s

Sof

twar

e10

374

3-4

60

800

9791

-90

179

621

Sum

mar

y10

374

3-4

60

800

9791

-90

179

621

goo

dw

ill

OO

O C

ATO

BN

EFT

3,90

30

-430

03,

473

00

00

03,

473

Sum

mar

y3,

903

0-4

300

3,47

30

00

00

3,47

3

Cos

t to

acq

uire

ass

ets

Acc

umul

ated

dep

reci

atio

nb

ook

valu

e

01.0

1.20

12A

dditi

ons

Fore

ign

curre

ncy

diffe

renc

esD

ispo

sals

31.1

2.20

1201

.01.

2012

Add

ition

sFo

reig

n cu

rrenc

y di

ffere

nces

Dis

posa

ls31

.12.

2012

31.1

2.20

12

TEU

RTE

UR

TEU

RTE

UR

TEU

RTE

UR

TEU

RTE

UR

TEU

RTE

UR

TEU

R

Tang

ible

ass

ets

Land

and

bui

ldin

gs14

,138

2,24

249

3-1

,225

15,6

485,

899

1,01

220

5-3

116,

805

8,84

3

Mac

hine

ry a

nd e

quip

men

t, in

clud

ing

vehi

cles

20,7

842,

885

355

-3,4

9320

,531

17,7

941,

807

279

-2,9

6116

,919

3,61

2

Oil

field

equ

ipm

ent

234,

127

98,5

557,

632

-12,

077

328,

237

105,

330

44,8

163,

282

-10,

674

142,

754

185,

483

Equi

pmen

t ele

ctro

nic

data

pro

cess

ing

1,19

120

4-3

6-2

131,

146

906

170

-48

-198

830

316

Adv

ance

pay

men

ts77

,181

-61,

844

00

15,3

370

00

00

15,3

37

Sum

mar

y34

7,42

142

,042

8,44

4-1

7,00

838

0,89

912

9,92

947

,805

3,71

8-1

4,14

416

7,30

821

3,59

1

inta

ngib

le a

sset

s

Sof

twar

e27

50

-40

-132

103

157

74-1

1-1

2397

6

Sum

mar

y27

50

-40

-132

103

157

74-1

1-1

2397

6

goo

dw

ill

OO

O C

ATO

BN

EFT

3,76

90

134

03,

903

00

00

03,

903

Sum

mar

y3,

769

013

40

3,90

30

00

00

3,90

3

(6)

PR

OP

ER

Ty, P

LAN

T A

Nd

Eq

UiP

mE

NT,

iNTA

Ng

ibLE

AS

SE

TS A

Nd

gO

Od

wiL

L

90

C.A.T. OiL Ag 2013

On the balance sheet date there were liabilities for property, plant and equipment ordered by the Group of TEUR 48,644 (2012: TEUR 16,780). Ordered property, plant and equipment primarily concern equipment and machinery, e.g. the sidetrack drilling rigs of the Group.

The Oil field equipment includes primarily the fracturing fleets and the drilling rigs of the C.A.T. oil Group necessary for providing the services.

Advance payments on ordered property, plant and equipment were TEUR 17,261 (2012: TEUR 15,337).

The reconciliation statement for carrying amounts can be seen in the following table:

The disposal of assets resulted into book gains of TEUR 428 (2012: TEUR 405 book loss).

Depreciated property, plant and equipment are primarily recognized in the cost of sales, a small amount only in the general and administrative expenses.

Tangible assets were not used as collateral in the reporting period an in the previous year.

The assets shown under property, plant and equipment are acquired for the entire Group by C.A.T. oil Trading House and sold on within the Group to C.A.T. oil Leasing. This company then leases the acquired leasing objects to the operative Group companies in Russia. There are no liabilities which are subject to collateralization.

A change to the normal operational useful life of 10% would have the following effect on the results for the period:

There are no direct effects on equity.

The goodwill derived from the business combination of CATOBNEFT is reported on the balance sheet date at TEUR 3,473 (2012: TEUR 3,903). The goodwill shall be translated at the end of each reporting period in accordance to IAS 21.47, using the applicable closing rates to the presentation currency. Changes in good-will valuation are shown in other comprehensive income and therefore in equity.

PROPERTy, PLANT

ANd EqUiPmENT

gOOdwiLL

2013 2012

TEUR TEUR

Carrying amount at 1 January 213,591 217,492

Investments 56,207 42,042

Scheduled depreciation -50,282 -47,462

Unscheduled depreciation 0 -343

Disposals at depreciated cost -2,245 -2,864

Foreign currency translation adjustments -21,220 4,726

Carrying amount at 31 december 196,051 213,591

2013 2012

TEUR TEUR

Effect on results +/- 4,576 +/- 4,345


91

C.A.T. OiL Ag 2013

A change in the exchange rates of 10% would have the following effects on equity:

An exchange rate change by 15%, would impact equity by a further change of TEUR +/- 174.

Impairment tests in the 2013 and 2012 financial years did not reveal any indications for impairment due to the fact that the recoverable amount exceeded the carrying amount of the cash-generating unit.

We refer to the explanations and disclosures made above in the sections on estimates and goodwill.

The financial assets include shares in a cooperative association under Russian law. The shares in this co-operative association are for the purpose of the execution of banking transactions. These shares have no fixed term to maturity and no nominal interest rate. No sale of these shares is planned.

The item long-term assets include accounts receivables of assets sold amounting to TEUR 347 (31.12.2012 TEUR 131). The residual terms of these loans vary between one and five years.

Deferred taxes result from the individual balance sheet items as follows:

(7) OThER

FiNANCiAL ASSETS

(8) OThER LONg-TERm

ASSETS

(9) dEFERREd TAxES

2013 2012

TEUR TEUR

Carrying amount at 1 January 326 315

Foreign currency translation adjustments -34 11

Carrying amount at 31 december 292 326

2013 2012

TEUR TEUR

Effect on equityt +/- 347 +/- 390

31.12.2013 31.12.2012

deferred tax

assets

deferred tax

liabilities

deferred tax

assets

deferred tax

liabilities

TEUR TEUR TEUR TEUR

Tax loss carryforwards 9,995 0 6,312 0

Deferred liabilities 12 -795 12 -685

Fixed assets/depreciation -2 16,026 -2 13,920

Other 864 3,270 1,549 2,038

Total 10,869 18,501 7,871 15,273


92

C.A.T. OiL Ag 2013

Accrued loss carryforwards in the amount of TEUR 46,813 (2012: TEUR 31,560) are assumed to be used medium- to long-term. Further losses of EUR 31,204 (2012: EUR 30,644) were not considered due to the fact that the utilization is not expected. Formation of deferred tax assets in the amount of TEUR 7,011 (2012: 7,661) was omitted.

In Austria, the tax loss carryforwards do not expire and therefore, it can be made use of them without res-triction. In Russia the tax loss carryforwards expire 10 years after the loss arose.

There were no consolidation-relevant deferred taxes either at 31 December 2013 or at 31 December 2012.

The trade accounts payable include all unpaid obligations of the Group from deliveries and services in the amount of TEUR 45,514 (2012: TEUR 35,879). The residual term of the trade accounts payable is less than one year.

The other liabilities are comprised as follows:

The residual term of the other short-term liabilities is less than one year.

The short-term payables against related entities concern deferred interest of the loan granted by CAT. Hol-ding (Cyprus) Ltd.

Received payments on account of TEUR 8 (2012: TEUR 10) exclusively concern advance payments made by customers.

Liabilities from income tax concern due income tax payable of TEUR 1,007 (2012: TEUR 833) and capital yield tax of TEUR 0 (2012: TEUR 95) to the Russian financial authorities as a result of dividend payments made to C.A.T. oil AG.

(10) TRAdE ACCOUNTS

PAyAbLE

(11) OThER ShORT-TERm

LiAbiLiTiES

(12) ShORT TERm

PAyAbLES AgAiNST

RELATEd ENTiTiES

(13) RECEivEd PAymENTS

ON ACCOUNT

(14) TAx LiAbiLiTiES

31.12.2013 31.12.2012

TEUR TEUR

Value added tax 6,563 6,525

Liabilities from wages and salaries 4,381 4,693

Deferred holiday entitlement liabilities 4,043 3,664

Liabilities from social insurance 1,012 988

Other tax liabilities 822 882

Property tax liabilities 460 1,106

Other liabilities 420 306

17,701 18,164


93

C.A.T. OiL Ag 2013

The long-term liabilities against related entities concern credit lines taken by the parent company CAT. Hol-ding (Cyprus) Ltd. With regard to these credit lines please refer to the section “Related parties”.

The long-term liabilities as at 31 December 2013 can be broken down according to residual term to maturity as follows (TEUR):

(15) LONg-TERm

LiAbiLiTiES AgAiNST

RELATEd ENTiTiES

LiAbiLiTy LEvELS Residual term to maturity

Schedule of liabilities as at 31.12.2013 Total < 1 year 1-5 years

Financial liabilities

Long-term liabilities

Payables against CAT. Holding (Cyprus) Ltd. 18,047 147 17,900

Trade accounts payable 45,514 45,514 0

Other short-term liabilities 17,701 17,701 0

Liabilities from wages and salaries 4,381 4,381 0

Other liabilities 420 420 0

Other short-term liabilities that do not constitute financial liabilities

12,900 12,900 0

Non-financial liabilities

Received payments on accounts 8 8 0

Tax liabilities 1,007 1,007 0

Total liabilities 82,277 64,377 17,900

Residual term to maturity

Schedule of liabilities as at 31.12.2012 Total < 1 year 1-5 years

Financial liabilities

Long-term liabilities

Payables against CAT. Holding (Cyprus) Ltd. 50,586 532 50,054

Trade accounts payable 35,879 35,879 0

Other short-term liabilities 18,164 18,164 0

Liabilities from wages and salaries 4,693 4,693 0

Other liabilities 306 306 0

Other short-term liabilities that do not constitute financial liabilities

13,165 13,165 0

Non-financial liabilities

Received payments on accounts 10 10 0

Tax liabilities 928 928 0

Total liabilities 105,567 55,513 50,054


94

C.A.T. OiL Ag 2013

There were no liabilities with residual term exceeding five years and no liabilities secured by collateral either in the reporting period or in the previous period.

ShARE CAPiTALThe share capital of C.A.T. oil AG as at 31 December 2013 was TEUR 48,850 (as at 31 December 20112: TEUR 48,850). The share capital is divided into 48,850,000 individual no par value shares and has been paid in full.

Each share has an equal value participation in the share capital. There are no restrictions to the shares in circulation. The minimum amount of share capital attributable to each share must be one euro. All shares grant equal rights. The shareholders are entitled to receive all dividends resolved upon and each share held grants one voting right at the general shareholders‘ meeting.

In the year under review no new shares were issued and no shares were redeemed. Furthermore, no option rights were exercised during the period under review.

AUThORizATiONSIn a resolution of the general shareholders’ meeting on 18 June 2010 the Management Board was autho-rized pursuant to section 169 of the Austrian Companies Act [Aktiengesetz, AktG] to increase the share capital of C.A.T. oil AG by up to TEUR 14,000 by 17 June 2015, either in one or in several share issues. As at the time of the preparation of this report, this option had not been exercised. On 30 June 2008 the general shareholders’ meeting of C.A.T. oil AG resolved to authorize the Management Board, with the prior approval of the Supervisory Board, to issue up to 10,000,000 convertible bonds, with attached conversion rights and subscription rights, within the following five years. This authorization was not used until the end of mid-2013.

CAPiTAL RESERvEThe capital reserve contains the share premiums from the issue of shares. RETAiNEd EARNiNgSThe retained earnings contain the legally prescribed reserves, undistributed profit from previous years and the annual surplus for the period under review.

FOREigN CURRENCy RESERvESThese reserves contain the differences from currency translations during consolidation. Furthermore, the for-eign currency reserves also contain translation differences from the net investments in foreign operations. He-reto please refer to the section “Foreign currency” of this report. The foreign currency reserves are fully usable.

(16) EqUiTy

2013 2012

TEUR TEUR

Foreign currency reserves at 1 January -30,692 -40,790

Changes due to foreign currency translation of Group loans -17,693 6,018

Changes due to net translation -14,160 4,080

Foreign currency reserves at 31 december -62,545 -30,692


95

C.A.T. OiL Ag 2013

dividENdSThe Management Board and Supervisory Board submit a proposal to the general shareholders‘ meeting to pay from the balance sheet profit of C.A.T. oil AG for the 2013 financial year, as determined pursuant to the Austrian Business Enterprise Code [Unternehmensgesetzbuch, UGB], a dividend of EUR 0.35 per share (2012: EUR 0.25). This would lead to a total dividend payout of MEUR 17.1 (2012: MEUR 12.2). The parent company has neither resolved upon nor carried out any interim dividend payouts after the balance sheet date. In the year under review a dividend of 0.25 EUR per share was paid out. In the year 2010 the Supervi-sory Board passed a dividend policy stating that 20% of consolidated net profit from sustainable, long-term results would be paid out in dividends to the shareholders. Dividends are dependent on the passing of a corresponding resolution by the general shareholders‘ meeting.

There is a guarantee for the fulfilment of obligations (guarantee for the fulfilment of contractual obligations from one specific job order) and a bank guarantee in favour of one Group company. In the opinion of the Group, these internal Group obligations will not lead to any contingent liabilities.

5. NOTES TO ThE iNCOmE STATEmENT

The situation of the company with regard to earnings is largely influenced by the climatic conditions in Russia and Kazakhstan. Due to the nature of the business, the revenue of the C.A.T. oil Group is generated mainly in the second and third quarters.

The revenues of TEUR 426,583 (2012: TEUR 336.772) are related exclusively to services rendered. The revenues include TEUR 12,928 (2012: TEUR 8,041) from rendering services recognized according to the stage of completion of the transactions. Of this amount, TEUR 0 (2012: TEUR 2,537) are attributable to discontinued operations.

(17) CONTiNgENT

LiAbiLiTiES

(18) SALES REvENUE

(19) COST OF SALES2013 2012

Continuing discontinued Continuing discontinued

operations operations

TEUR TEUR TEUR TEUR

Raw materials 128,099 0 90,991 0

Direct costs 96,255 0 79,786 3,531

Depreciation 49,905 0 46,842 765

Wages and salaries 45,599 0 40,861 325

Provident and welfare expenses 11,674 0 9,931 0Other sales costs 9,661 0 8,801 893

341,193 0 277,212 5,514


96

C.A.T. OiL Ag 2013

Rental contracts have a residual term of less than one year.

(20) OThER

OPERATiNg iNCOmE

(21) AdmiNiSTRATivE

ExPENSES

2013 2012



TEUR TEUR TEUR TEUR

Income from disposal of property, plant and equipment 421 7 18 341Income from penalties 211 0 407 0

Income from prior periods and other valuation adjustments 186 82 104 734Income from payments of receivables previously

1 168 70 0Other income 86 0 228 80

905 257 827 1,155

2013 2012



TEUR TEUR TEUR TEUR

Wages and salaries (incl. remuneration for executive bodies) 7,720 86 7,351 0Expenses for licences 2,756 0 2,453 0

Provident and welfare expenses 1,500 0 1,456 0Rent expense on an operating lease 1,336 0 1,139 0Consulting fees 1,049 132 1,445 118Travel and entertainment expenses 1,000 17 877 29Other services 871 0 824 34Bank fees 560 2 632 21Purchase 475 0 446 0Depreciation of property, plant and equipment 468 0 272 0Audit fees 384 0 448 2Insurance 350 0 868 22Maintenance costs 174 0 330 0Training costs 19 0 196 0Other administrative expenses 2,838 0 2,661 2

21,500 237 21,398 228


97

C.A.T. OiL Ag 2013

Expenses and income from exchange rate differences related to translations of business transactions in foreign currency.

Exchange differences resulting from intra-Group loans issued by C.A.T. oil AG, which are part of a net investment, shall be recognized in other comprehensive income. This refers to the loans awarded to the subsidiary C.A.T. oil Leasing. In the consolidated financial statements, the foreign currency results from translation of net investments in the amount of TEUR -17,693 (2012: TEUR 6,018) have been reclassified in the foreign currency reserve.

Interest income is mainly attributable to interest on cash and cash equivalents.

The bank financing of the Group‘s Russian subsidiaries generates ongoing interest expenditure in each period and this is attributable to the category “Financial liabilities valuated at amortized cost”.

The amount of paid and received interest corresponds to the respective expenditure and income in the year under review. In the financial statements as at 31 December 2013 as well as in the previous year there were neither interest receivables nor interest payables.

(22) OThER OPERATiNg

ExPENSES

(23) FiNANCiAL RESULTS

2013 2012



TEUR TEUR TEUR TEUR

Write-down of trade account receivable 137 0 319 461Other value adjustments of discontinued operations

0 0 0 497

Expenses for the disposal of property, plant and equipment 0 0 361 490Other expenses 71 35 54 70

208 35 734 1,518

2013 2012



TEUR TEUR TEUR TEUR

Interest income 737 5 324 27Interest expenses -1,882 0 -3,382 0

Expenses from exchange rate differences 0 0 698 80Income from exchange rate differences -739 0 0 0

-1,884 5 -2,360 107


98

C.A.T. OiL Ag 2013

The tax rate for the Austrian companies in 2013 was 25% (2012: 25%), for the Russian subsidiaries 20% (20112: 20%).

The income tax burden and the pre-tax results for determination of the effective interest rate are as follows:

Income tax relief resulting from discontinued operation amounted to TEUR 209 (2012: TEUR 0).

There were no tax burdens on the other comprehensive income.

The collected taxes in Russia and Kazakhstan in 2013 amounted to TEUR 9,342 (2012: TEUR 5,287). The income tax contains withholding taxes of TEUR 1,683 dissipated to Russian financial authorities resulting from intra-Group dividend and interest income as qualified dividends (20112: TEUR 899). The rate for taxa-tion at source in Russia is unchanged 5%.

(24) iNCOmE TAx

2013 2012

TEUR TEUR

Taxes paid or payable

Austria 65 0

Russia and Kazakhstan 9,342 5,287

Current tax expenses 9,407 5,287

Deferred tax expense (income) relating to the origination and reversal of temporary differences 1,075 2,559Withholding tax 1,680 899

Income taxes from previous years -309 119

Current and deferred tax expenses 11,853 8,864

Result before income income taxes 62,693 29,897

Tax at the average effective tax rate 14,175 6,645

Tax-free income -197 -180

Non-deductible expenses 1,404 211

Tax expenses in the Group companies operating abroad 400 255Impact due to differences between local tax law an IFRS -4,768 -1,358

Other effects -1,607 -286

Current other and deferred tax expenses P&L2,446 3,577

Tax expenses according to income statement 11,853 8,864

Tax rate 18.91% 29.65%


99

C.A.T. OiL Ag 2013

The undiluted earnings per share are calculated on the basis of the division of the portion of the Group ear-nings of C.A.T. oil AG allocated to the shareholders by the weighted average of issued shares.

There were no dilutive earnings per share both in the financial year 2013 and in the previous year.

6. SEgmENT REPORTiNg

The segment reporting of the C.A.T. oil Group follows the “management approach” with regard to the inter-nal organizational and reporting structure. The data used in order to determine the internal control parame-ters is derived from the internal reporting system. The Operating Board in Moscow allocates and controls the resources based on the internal reporting.

As part of the successful implementation of the investment program, in particular for the establishment of the new drilling business and the expansion of the existing services as well as the comprehensive profes-sional project supervision, the following two segments were determined since January 2013 as reportable segments: Well Services and Drilling, Sidetracking, Integrated Project Management (IPM). The segment information of the reference period from 01.01.2012 to 31.12.2012 was adjusted accordingly.

The purpose of the reconciliation is mainly the elimination of intra-Group sales, expenses and income.

The accounting principles used for the presentation and valuation of the segment assets correspond with the principles used for the presentation and valuation of the assets of the Group. The profitability of the Group is measured on the basis of earnings before income and tax (EBIT) and earnings before income and tax, depreciation and amortization (EBITDA), as shown on the income statement.

(25) EARNiNgS

PER ShARE

2013 2012

Weighted average of issued shares (in thousand units) 48,850 48,850

Group earnings (in TEUR) 50,641 24,494

Earnings per share (in EUR) 1,037 0,501

Earnings from discontinued operations (in TEUR) 199 -3,461

Earnings per share (in EUR) 0.004 -0.071


100

C.A.T. OiL Ag 2013

The segment assets of the segment Well Services as well as the segment Drilling, Sidetracking, IPM are located exclusively in Russia and Kazakhstan. Financial information on non-current assets by geographical areas is not used to prepare the Group financial statements.

2013well

Services

drilling,Sidetracking,

iPm

Total of reportable operative segments

Recon-ciliation group

TEUR TEUR TEUR TEUR TEUR

External sales 227,374 199,497 426,871 -288 426,583

Group sales 3,184 749 3,933 -3,933 0

Total revenues 230,558 200,246 430,804 -4,221 426,583

Cost of sales 183,021 161,517 344,538 -3,344 341,194

Administrative expenses 5,531 7,589 13,120 8,617 21,737

Depreciation contained in cost of sales and administrative exp.

14,071 32,909 46,980 3,393 50,373

Segment results 42,006 31,140 73,146 -9,494 63,652

Other operating income / expenses 383 -352 31 889 920

EBITDA 56,460 63,697 120,157 -5,212 114,945

EBIT 42,389 30,788 73,177 -8,605 64,572

Reconciliation of segment result (EBIT) to consolidated earnings before taxesFinancial result -1,879

Result before income taxes 62,693

Segment assets 112,181 195,949 308,130 44,395 352,525

Segment liabilities 11,139 20,418 31,557 69,222 100,779

Segment investments 21,442 33,445 54,887 2,063 56,950

2012well

Services

drilling,Sidetracking,

iPm

Total of reportable operative segments

Recon-ciliation group


External sales 183,564 153,039 336,603 169 336,772

Group sales 2,175 8,678 10,853 -10,853 0

Total revenues 185,739 161,717 347,456 -10,684 336,772

Cost of sales 157,634 129,652 287,286 -4,560 282,726

Administrative expenses 5,428 7,065 12,493 9,133 21,626

Depreciation contained in cost of sales and administrative exp.

19,000 28,265 47,265 614 47,879

Segment results 22,677 25,000 47,677 -15,257 32,420

Other operating income / expenses 258 -217 41 -311 -270

EBITDA 41,935 53,048 94,983 -14,954 80,029

EBIT 22,935 24,783 47,718 -15,568 32,150

Reconciliation of segment result (EBIT) to consolidated earnings before taxesFinancial result -2,253

Result before income taxes 29,897

Segment assets 120,935 206,983 327,918 37,894 365,812

Segment liabilities 11,092 18,040 29,132 91,708 120,840

Segment investments 9,445 94,776 104,221 -62,179 42,042


101

C.A.T. OiL Ag 2013

Revenue is achieved by the C.A.T. oil Group exclusively in Russia and Kazakhstan.

7. AddiTiONAL dETAiLS ANd iNFORmATiON ON ThE USE OF FiNANCiAL iNSTRUmENTS

PRESENTATiON OF FiNANCiAL iNSTRUmENTS:

The table below contains an overview of carrying amounts and fair values of the individual financial instru-ments broken down by class and a reconciliation of the corresponding balance sheet item:

Sales revenue in regions and sales to individual customers with 2013 2012

a volume of more than 10% of the total revenue TEUR TEURRussia

Rosneft, incl. TNK-BP 158,543 150,040

LukOil 126,325 109,418

Gazprom 54,731 38,765

Tomskneft 36,258 22,581

Slavneft 27,714 779

Russneft 9,667 2,156

Other Russian customers 4,703 3,459

Total revenue from Russia 417,941 327,198

Kazakhstan 8,642 7,037

Other regions 0 2,537

426,583 336,772

Level Carrying amount

31.12.2013 31.12.2012

TEUR TEUR

Loans and receivables

Trade accounts receivable n.a. 73,483 72,930

Other current assets n.a. 160 160

Other non-current assets n.a. 347 131

Total loans and receivables 73,990 73,221

Non-financial assets of the following balance sheet items

Trade accounts receivable 0 0

Other current assets 3,343 2,576

Other non-current assets 0 0

3,343 2,576

Trade accounts receivable as per balance sheet 73,483 72,930

Other current assets as per balance sheet 3,503 2,736

Other non-current assets as per balance sheet 347 131

Available for sale

Other financial assets n.a. 292 326

Cash and cash equivalents 42,640 38,816


102

C.A.T. OiL Ag 2013

The financial assets available for sale concern shares in a cooperative bank under Russian law. Due to the lack of an active market, it is not possible to reliably determine the value of this financial asset. For this rea-son valuation is at amortized cost. The categories “assets and liabilities valuated at fair value through profit and loss” and “financial investments held-to-maturity” did not exist either in the year under review or in the previous year. The carrying amount of trade receivables and current and non-current assets corresponds to their fair value. There were no purchases or sales of financial assets either on the trading day or on the settlement day. Financial instruments were not assigned as security either in the year under review or in the previous year.

Fair valuation of liabilities is as follows:

For trade payables, short-term and long-term liabilities and other liabilities the carrying amount corresponds to the fair value.

The net results from financial assets are as follows:

Level Carrying amount

31.12.2013 31.12.2012

TEUR TEUR

Financial liabilities valuated at amortized costs

Long-term payables against CAT. Holding (Cyprus) Ltd. n.a. 17,900 50,054

Short-term payables against CAT. Holding (Cyprus) Ltd. n.a. 147 532

Trade accounts payable n.a. 45,514 35,879

Liabilities from wages and salaries n.a. 4,381 4,693

Other liabilities n.a. 420 306

Total financial liabilities valuated at amortized costs 68,362 91,464

Other short-term liabilities

Liabilities from wages and salaries (see above) 4,381 4,693

Other liabilities (see above) 420 306

Other liabilities that are not financial instruments 12,900 13,165

17,701 18,164

2013 2012

TEUR TEUR

Financial assets

Loans and receivables -76 -1.181

Liquid funds 682 325

Results from financial assets 606 -856

Results from financial assets valuated at amortised cost -1.882 -3.382


103

C.A.T. OiL Ag 2013

The net results from loans and receivables are mainly attributable to individual impairments and write-downs of TEUR 137 (2012: TEUR 1,277), income from written-down receivables of TEUR 1 (2012: TEUR 70) as well as from discounting of long-term receivables of TEUR 60 (2012: TEUR 26).

RiSK mANAgEmENT

The Management Board of C.A.T. oil AG has put in place a system for the early recognition of risks, which is monitored by the Supervisory Board. The underlying principles for risk management are based on the fra-mework conditions in place within the Group for the fulfilment of the necessary requirements for the proper early recognition of risk.

The following information details the economic risks facing the Company. Adequate risk precautions are to be put in place during the course of the management of economic risk, in particular in operative areas.

ENTREPRENEURiAL RiSKS

The business activities of the C.A.T. oil Group and the focus of these activities on Russia and Kazakhstan imply significant financial risks, in particular during these times of crisis on the financial markets. These risks are primarily interest and liquidity risks, foreign currency risks and the risk of changes to the rating of the C.A.T.oil Group. There is a particular risk posed by changes to the political situation in Russia and Kazakh-stan. The Group-wide risk management system is designed to identify, assess and analyze the risks and chances for the Group, also in the area of financial risk, as well as to put into place measures that guarantee the limitation of damages and safeguarding of profits in the event of the occurrence of risks and chances. The focus of business activities on Russia and Kazakhstan means that the Group is particularly dependent on specific situations and developments within these countries and the risks accompanying them. In par-ticular the monetary and economic policies dictated by the Russian Government may have a significant effect on the risks to the assets, finances and earnings situation of the Group. Measures for stabilization and strengthening of the economic power of the commodities industry have indirect consequences for the ser-vice companies within this field. Possible trends to depreciation of the rouble against the euro, the reporting currency of the Group, could also have direct consequences for the Group.

The worldwide financial and economic crisis could lead to the complete or partial write-off of individual assets or the value of individual companies, if the targeted levels of business development cannot be achie-ved. This could have a significant effect on the development of the Group’s earnings.

dEFAULT RiSK

The receivables of the C.A.T. oil Group and the connected credit risk for services not yet invoiced constitute a risk of default, whereby the maximum default risk is the total carrying amount of receivables.


104

C.A.T. OiL Ag 2013

Risk of default is defined as unexpected loss of cash or income due to the fact that the customer is not in a position to meet his payment obligations within the agreed payment period. Since in crisis periods the relevance of default risk increases, we control our business policy with special care.

The task of monitoring the situation with regard to default risk is the responsibility of the individual subsi-diaries and the second level management in Moscow. However, this risk is minimized by the fact that the customer basis of the C.A.T. oil Group consists of a small number of large customers of good credit stan-ding, with whom the Group has many years of successful business relations. New customers are subjected to a creditworthiness check before business relations are entered into.

The by far predominant part of trade accounts receivable at balance sheet date refers to the already men-tioned major customers (compare also section “Segment reporting”). Thus, the trade accounts receivable are not on such a high level so that they could represent an extraordinary risk concentration. Existing risk is taken into consideration through the formation of specific provisions for doubtful debts. Further hedging of claims was not carried out. The maximum default risk corresponds to the value of financial assets of the category “Loans and receivables”:

FOREigN CURRENCy RiSK

Exchange rate fluctuations can induce undesirable and unpredictable volatility of earnings and cash flows.

Due to the international orientation of the C.A.T. oil Group in Russia and Kazakhstan there is exposure to foreign currency risk during the Group’s normal business activities. Risks on the basis of the principle of functional currency are to be classified as low due to the fact that the areas Well Services, Drilling, Sidetra-cking and IPM is invoiced largely in the currencies of rouble and tenge. For this reason no currency hedging transactions are carried out.

In the year 2008 there were currency losses on the balance sheet date, pursuant to the standards of IAS 21.45, on loans issued in euro by C.A.T. oil AG to the subsidiaries C.A.T. oil Leasing and C.A.T. oil Trading House. These losses were due to the strength of the euro. In 2009 parts of the loans issued to C.A.T. oil Tra-ding House and C.A.T. oil Leasing were contributed to the equity of these respective companies during the course of an increase in the share capital of each company. The currency fluctuations that occurred before the capital increase, which are shown as part of equity, will remain part of equity until the deconsolidation of this company. For commercial reasons no currency hedging transactions have been conducted up to now due to the fact that an outflow of funds would be required for such hedging transactions. The loans are long-term loans to the subsidiary companies, meaning that the short-term realization of exchange rate losses with a connected outflow of funds is not to be envisaged.

31.12.2013 31.12.2012

TEUR TEUR

Trade accounts receivable 73,483 72,930


Other long-term assets 347 131

73,990 73,221


105

C.A.T. OiL Ag 2013

On the basis of consideration according to functional currency, there are currency risks for transactions in progress, in particular with regard to orders.

The companies within the Group are always exposed to currency risk if payments are made in currencies other than their respective functional currency. The following table shows the effects of currency differences affecting income and the effects of the internal Group loan, which was reclassified on 31 March 2008 (see notes to “Foreign currencies”), in the event of an assumed depreciation of the foreign currency of 10% against the respective functional currency:

An exchange rate change of 15%, would impact equity by a further change of TEUR 5.458.

Broken down by currency, the risks to balances held in foreign currencies are as follows:

An exchange rate change of 15% would increase the trade accounts payable and other liabilities by TEUR 254.

31.12.2013 31.12.2012

TEUR TEUR

EURO

Trade accounts payable and other liabilities -510 -765

US-DOLLARS


Liabilities tto CAT. Holding (Cyprus) Ltd. 0 35,186

KAZAKHSTANI TENGE

Other receivables 1,960 1,578

Trade accounts payable and other liabilities -484 -545

income statement Equity

2013 2012 2013 2012

TEUR TEUR TEUR TEUR

Euro 55 79 12,552 14,264

US Dollars 0 33 0 0

Kazakhstani Tenge -148 -100 0 0


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C.A.T. OiL Ag 2013

TRANSLATiON RiSK

There is exposure to translation risk at Group level due to the consolidation of subsidiaries that draw up their balance sheets in currencies other than the euro. The largest risk is posed by the rouble and its fluctuation in value against the euro. The long-term exchange rate risks associated with investments in shareholdings in companies that do not draw up their balance sheets in the euro is assessed on a continuous basis. In the event of appreciation of the euro against the rouble of 10%, the effect of this translation risk on the Russian subsidiaries would have the following consequences for the Group’s equity:

An exchange rate change of 15% would increase equity by a further change of TEUR 3,732 and profit and loss by further TEUR 2,011.

iNTEREST RiSK

With variable interest rate loans there is a risk posed by changes in cash flows due to potential changes to the market interest rate. This risk would have an effect on the financial results and/or equity. In the year under review C.A.T. oil AG called upon variable interest rate loans, meaning that it was subject to risk from changes to interest rates. Other payables to banks during the year under review were subject to fixed-rate interest, meaning that changes to the market interest rates did not pose any risk. The current interest rates are being monitored on a regular basis. If applicable, refinancing and alternative forms of financing have been evaluated.

Changes to the variable interest rates had only indirect effects on the income statement, which are presen-ted in the following:

An exchange rate change of 15% would increase the long-term payables by a further TEUR 40.No interest hedging transactions have been carried out.

No interest hedging transactions have been carried out.

31.12.2013 31.12.2012

TEUR TEUR

A 10% change in the exchange rate would have the following effects on equity +/- 8,582 +/- 7,462A 10% change in the exchange rate would have the following effects on the income statement +/- 4,621 +/- 1,753

31.12.2013 31.12.2012

TEUR TEUR

Long-term payables +/- 81 +/- 261Short-term payables +/- 1 +/- 3


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C.A.T. OiL Ag 2013

OThER mARKET PRiCE RiSKS

Market price risks include changes to the fair value of assets or of future cash flows. Further risks include ris-ks from factors affecting the procurement of raw materials and supplies, in particular significant changes to purchase prices. Other risks included in this category are non-financial risks and other entrepreneurial risks.

Market price fluctuations could have significant consequences for the C.A.T. oil Group in the form of risks to cash flows and earnings. Currently this risk is seen as insignificant and is adequately covered by the risk management system. There are no notable quantifiable market risks.

Amongst other factors, the future success of the Group is dependent on being able to win new contracts. It is sometimes difficult to predict whether and when a contract for which a Group company has submitted a tender will be awarded. The awarding of contracts can be influenced by factors that are beyond the influen-ce of the Group, such as e.g. pricing factors, demand, general economic factors, official permits and finan-cing requirements. In this situation there may be delays to the awarding of contracts and in some instances customers may be lost entirely. In Russia the oil and gas industry is of real economic and strategic import-ance. There is therefore a possibility that the government will continue to expand its influence in this sector.

Insofar possible in a market with a restricted number of oil and gas producers, our customer base is diver-sified.

LiqUidiTy RiSK

Liquidity risk is the risk of not being in a position to meet existing and/or future payment obligations due to a lack of or insufficient availability of funds. In the light of the current economic crisis, the liquidity risk factor has become more and more prominent. In order to guarantee solvency and financial flexibility, the Company maintains foresighted financial planning looking forward over several years and rolling liquidity planning ba-sed on long-term lines of credit and liquid funds. Despite the present debt crisis in some countries a sound basis for the financing in the years to come was established.

There exist at balance sheet date the following loan agreements respectively overdraft credit lines:

Collateralisation of the credit lines of the Russian companies is realized by assignment as security of fixed assets and inventories.

31.12.2013 31.12.2012 2013 2012

Loan agreements TEUR TEUR Interest rate Interest rate

Intra-Group with fixed rate interest 138,076 156,907 6.53% 5.59%

Lines of credit 0 6,214


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C.A.T. OiL Ag 2013

The liquidity situation is currently rated by the Management Board as “good” due to the fact that approved lines of credit have not been called upon. The approved line of credit is available on a long-term basis (final maturity: November 2015). This line of credit was taken out in November 2010 with Eurobank EFG (Cyp-rus). These lines of credit were used either for the financing of working capital or for the financing of the investment program 2011-2012 in the amount of MEUR 150,0. Taking into consideration the Europe-wide debt crisis and the aggravated situation on the financial markets, the Management Board took the decision, with a view to guaranteeing the availability of lines of credit even in the event of a further worsening of the debt crisis and negative consequences for the banking industry, to enter into negotiations with CAT. Holding (Cyprus) Ltd. in order to replace the existing line of credit awarded by EFG Eurobank and make available alternative line of credit via CAT. Holding (Cyprus) Ltd. on the same conditions and with the same maturity dates. On 29 July 2011 the Supervisory Board of C.A.T. oil AG approved the substitution of CAT. Holding (Cyprus) Ltd. for the previous lender Eurobank EFG. Due to the fact that CAT. Holding (Cyprus) Ltd. is the direct parent company, we refer to the section on related parties. There were no payment defaults or other breaches of contract.

The liquidity risk for the C.A.T. oil Group exists in that it may find itself in a position in which it is unable to fulfil its financial obligations, for example with regard to the payment of trade payables. In this risk category there are also industry-specific dependencies to be taken into consideration, which could lead to default in payment.

In order to assess the liquidity risks, there are Group-wide monthly analyses of planned incoming and out-going payments and of the planned development of net liquidity. The plans for the development of net liqui-dity are drawn up on the basis of a comparison of existing financial investments and financing transactions, their scheduled due dates and existing liquidity reserves. All financing decisions concerning the tying up of capital are made on the basis of this analysis. In consideration of the prevailing financial markets crisis and the related clampdown on credit, C.A.T. oil has placed additional emphasis on management of the liquidity risk. In order to guarantee the liquidity and therefore the financial flexibility of the Group, a liquidity reserve is maintained in the form of approved lines of credit.

In the year under review the C.A.T. oil Group was able to meet all payment obligations (interests and re-demption) punctually and without cause for complaint. This also applies to all other financial liabilities, insofar as there were no legal or other objections.

The undiscounted cash flows as at the balance sheet date can be seen in the following table:


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C.A.T. OiL Ag 2013

8. CAPiTAL mANAgEmENT

The prime objective of capital management is to maintain liquidity for future payment obligations and pre-serve the Group’s equity under application of the going concern principle. No changes have been made to the capital management procedure in comparison to the previous year.

Reliable capital management is guaranteed via regular supervision and control of borrowing requirements and the targeted investment in liquidity reserves.

On the balance sheet date the equity ratio was 71,4% (31 December 2012: 67,0%).

Net liquidity is calculated on the basis of the total cash and cash equivalents less short-term and long-term financial liabilities:

Standard & Poor‘s increased the rating by one notch to BB and expected the outlook for the company as stable. Moody‘s published in October their opinion with an unchanged rating of Ba3 but with a positiv outlook.

31.12.2013 31.12.2012

TEUR TEUR

Cash and cash equivalents 42,640 38,816Payables against CAT. Holding (Cyprus) Ltd. -18,047 -50,586Trade accounts payable -45,514 -35,879Other liabilities with the exception of deferred liabilities -420 -306Net liquidity -21,341 -47,955Total capital 251,747 244,972Net debt (relative) 8.5% 19.6%


Cash flow

Interest Carrying amount

Total Cash flow

< 6 months 6 to 12 months 1 to 2 years 2 to 5 years

2013 Interest Re-demp-

tion

Interest Re-demp-

tion

Interest Re-demp-

tion

Interest Re-demp-

tion

Floating rate financial instruments

TEUR TEUR TEUR TEUR TEUR TEUR TEUR TEUR TEUR TEUR

Liabilities against CAT. Holding (Cyprus) Ltd.

4.4% 18,047 21,477 406 74 406 74 805 4,475 1,812 13,425

2012 Interest Re-demp-

tion

Interest Re-demp-

tion

Interest Re-demp-

tion

Interest Re-demp-

tion

Floating rate financial instruments

TEUR TEUR TEUR TEUR TEUR TEUR TEUR TEUR TEUR TEUR

Liabilities against CAT. Holding (Cyprus) Ltd.

4.8% 50,586 61,687 1,317 266 1,317 266 2,605 12,513 5,862 37,541

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C.A.T. OiL Ag 2013

9. OThER dETAiLS

RELATEd PERSONS ANd RELATEd COmPANiES

The related companies and persons of the C.A.T. oil Group include all affiliated companies and all compa-nies presented in this section. Furthermore, the members of the Management Board and Supervisory Board of C.A.T. oil AG and their close relatives are to be seen as related persons, as are the members of the se-cond level management in Moscow. These persons received no further remuneration than that listed below.

CAT. Holding (Cyprus) Ltd. has a direct participating interest of 47,70% (2012: 60,0%)in C.A.T. oil AG. Indi-rectly via CAT. Holding (Cyprus) Ltd., Anna Brinkmann holds 23,73% (2012: 29.85%) and Dr. Walter Höft, the sole shareholder of the ultimate parent company Coraline Limited, holds 23,97% (2012: 30.15%) in C.A.T. oil AG. In addition, Anna Brinkmann holds directly 10.99% shares of C.A.T. oil AG.

REmUNERATiON FOR mANAgEmENT mEmbERS iN KEy POSiTiONS

In the year under review, the following persons were members of the Management Board:• Manfred Kastner – Chairman of the Management Board• Ronald Harder – Deputy Chairman of the Management Board• Anna Brinkmann – Member of the Management Board• Leonid Mirzoyan – Member of the Management Board

In the year under review, the following persons were members of the Supervisory Board:• Dr. Gerhard Strate – Chairman of the Supervisory Board• Dr. Manfred Zacher – Deputy Chairman of the Supervisory Board• Mirco Schroeter – Member of the Supervisory Board• Dr. Walter Höft – Member of the Supervisory Board


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C.A.T. OiL Ag 2013

The remuneration payable to members of the executive bodies of the Company consists solely of fixed salaries. No loans or advances were paid to members of the executive bodies either during the course of the financial year or on the balance sheet date and no share-based payment was awarded. Furthermore, there were no other significant business transactions between members of the executive bodies and the Company. There were and are no guarantees or other commitments to the benefit of members of the exe-cutive bodies of the Company. No remuneration was paid to former members of the executive bodies of the Company either in the year under review or in the previous year.

No payments have been made after the termination of employment relations.

The remuneration paid to the members of the second level of management in Moscow as well as to family members was as follows:

There were no receivables from or liabilities to either members of the second level management in Moscow or to family members as at 31 December 2013 and 31 December 2012.

management board remuneration

ManfredKastner

RonaldHarder

AnnaBrinkmann

LeonidMirzoyan

Totalrenumeration


Salaries 2013 250 245 231 225 951

thereof non-monetary compensation

7 13 3 0 23

Salaries 2012 250 248 228 225 951

thereof non-monetary compensation

7 17 0 0 24

Supervisory board remuneration

Dr. GerhardStrate

Dr. ManfredZacher

MircoSchroeter

Dr. WalterHöft

Totalrenumeration


Remuneration 2013 35 24 21 17 97

Remuneration 2012 37 25 22 10 94

2013 2012

TEUR TEUR

Salaries second management level 772 690Salaries close members of the family Edward Brinkmann 133 133 905 823


112

C.A.T. OiL Ag 2013

The following companies are to be identified as related companies:

Business transactions with related parties are detailed in the following table:

Related company Abbreviated to Comment

A2C Treuhand GmbH

Wirtschaftsprüfungs-

gesellschaft, Hamburg

A2C A2C was incorporated with member of the

Supervisory Board Mirco Schroeter being simulta-

neously a managing director of this company.

There is a consultancy agreement in place with A2C.

The monthly consultancy fee amounted to TEUR 27

(2012: TEUR 27). This amount includes payments for

accounting services for C.A.T. oil AG and

C.A.T. GEODATA.

Fairtune Limited,

Nicosia/Cyprus

Fairtune This company is a 100% subsidiary of C.A.T. GmbH

Consulting Agency Trade & Company (Cyprus),

Nicosia/ Cyprus, the shares of which are held

exclusively by Frau Anna Brinkmann and the

company Coraline Limited, Nicosia/ Cyprus.

Fairtune East Limited,

Moscow, Russia

Fairtune East There are rental contracts between Fairtune East

and three Group companies for office and business

premises in Russia. Fairtune East is a subsidiary

of Fairtune. Rental payments are paid monthly in

an amount of TEUR 68 (2012: TEUR 68).

Poesia Holding Limited, Poesia Manfred Kastner is sole shareholder of this company.

This company holds shares in C.A.T. oil AG.

CAT. Holding (Cyprus)

Limited, Nicosia

C.A.T. Cyprus

This company is a direct parent company. It replaced

the EFG Eurobank as a previous lender of a credit

line. The interest rate was fixed at 6-month-LIBOR

with average of 4.76% (2012: 4,76%) for the USD-

denominated loans and at 6-month-EURIBOR and

average of 4.38% (2012: 5,24%) for the EUR-denomi-

nated loans.


113

C.A.T. OiL Ag 2013

dETAiLS ON PERSONNEL

The staff costs were as follows:

2013 2012

TEUR TEUR

Parent company (C.A.T. oil Ag)Fee expenses 345 345

Rental expenses 16 19

Interest expenses 1,813 3,356

2,174 3,720

Subsidiaries

Fee expenses 16 16

Rental expenses 823 861

839 877

Parent company (C.A.T. oil Ag)

Liabilities from fee expenses 0 0

Liabilities from rental expenses 1 2

Short-term payables to CAT. Holding (Cyprus) Ltd.

147 532

Long-term payables toCAT. Holding (Cyprus) Ltd.

17,900 50,054

18,048 50,588

Subsidiaries

Liabilities from fee expenses 0 0

Liabilities from rental expenses 162 141

162 141

2013 2012

TEUR TEUR

wages and salariesShown under cost of sales 45,599 41,186

Shown under administrative expenses 7,806 7,351

Total wages and salaries 53,405 48,537

Expenses for social security contributions

Expenses for legally prescribed contributions

Russia 11,599 10,143

Austria 253 239

Other social security contributions 1,322 1,006

Total social security contributions 13,174 11,388

The social security contributions are a matter of exclusively contribution-orientated expenses.

Average number of employees

Full-time employees 2,708 2,455

Part-time employees 65 67

Total number of employees 2,773 2,522


114

C.A.T. OiL Ag 2013

ExPENdiTURE FOR gROUP ENd-OF-yEAR AUdiTOR

The group end-of-year auditor received the following remuneration:

The fee for Group end-of-year auditor includes the fees for the end-of-year auditing of the Group consoli-dated financial statements and the separate annual financial statements of C.A.T. oil AG by BDO Austria GmbH, Vienna. The fee for other auditing services includes fees for the inspection and audit of the interim fi-nancial statements. The fees for other services include mainly fees for project-related consultancy services.

10. EvENTS AFTER ThE bALANCE ShEET dATE

On 03 April 2014 C.A.T. oil AG and CAT. Holding Ltd. signed the agreement of a prolongation of the EUR 100 million credit line until 31 December 2018.


2013 2012

TEUR TEUR

Fee for Group end-of-year auditor 85 85Fee for other auditing services 48 54Other services 1 14

134 153


115

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89

AUdiTOR’S REPORTSTATEmENT OF ALL LEgAL REPRESENTATivESgLOSSARy

C.A.T. OiL Ag 2013

ANNUAL REPORT 2013 | AUdiTOR’S REPORT, STATEmENT OF ALL LEgAL REPRESENTATivES ANd gLOSSARy

116

C.A.T. OiL Ag 2013

ANNUAL REPORT 2013 | AUdiTOR’S REPORT

REPORT ON ThE CONSOLidATEd FiNANCiAL STATEmENTS

We have audited the accompanying consolidated financial statements of

C.A.T. oil AG, Vienna

for the fiscal year from January 1, 2013 to December 31, 2013. These consolidated financial statements comprise the consolidated balance sheet as of December 31, 2013, the consolidated income statement, the consolidated statement of comprehensive income, the consolidated cash flow statement and the con-solidated statement of changes in equity for the fiscal year ended December 31, 2013, and a summary of significant accounting policies and other explanatory notes.

mANAgEmENT’S RESPONSibiLiTy FOR ThE CONSOLidATEd FiNANCiAL STATEmENTS ANd FOR ThE ACCOUNTiNg SySTEm

The Company’s management is responsible for the group accounting system and for the preparation and fair presentation of these consolidated financial statements in accordance with International Financial Re-porting Standards (IFRSs) as adopted by the EU, and in accordance with relevant Austrian laws. This re-sponsibility includes: designing, implementing and maintaining internal control relevant to the preparation and fair presentation of consolidated financial statements that are free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting esti-mates that are reasonable in the circumstances.

AUdiTOR’S RESPONSibiLiTy ANd dESCRiPTiON OF TyPE ANd SCOPE OF ThE STATUTORy AUdiT

Our responsibility is to express an opinion on these consolidated financial statements based on our audit. We conducted our audit in accordance with laws and regulations applicable in Austria and Austrian Stan-dards on Auditing, as well as in accordance with International Standards on Auditing (ISAs) issued by the International Auditing and Assurance Standards Board (IAASB) of the International Federation of Accoun-tants (IFAC). Those standards require that we comply with professional guidelines and that we plan and perform the audit to obtain reasonable assurance whether the consolidated financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Group’s preparation and fair presentation of the consolidated financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

AUdiTOR’S REPORT

117

C.A.T. OiL Ag 2013

ANNUAL REPORT 2013 | AUdiTOR’S REPORT

OPiNiON

Our audit did not give rise to any objections. In our opinion, which is based on the results of our audit, the consolidated financial statements comply with legal requirements and give a true and fair view of the financial position of the Group as of December 31, 2013 and of its financial performance and its cash flows for the fiscal year from January 1, 2013 to December 31, 2013 in accordance with International Financial Reporting Standards (IFRSs) as adopted by the EU and applicable Austrian laws.

COmmENTS ON ThE mANAgEmENT REPORT FOR ThE gROUP

Pursuant to statutory provisions, the management report for the Group is to be audited as to whether it is consistent with the consolidated financial statements and as to whether the other disclosures are not misleading with respect to the Company’s position. The auditor’s report also has to contain a statement as to whether the management report for the Group is consistent with the consolidated financial statements and whether the disclosures pursuant to Section 243a UGB (Austrian Commercial Code) are appropriate.

In our opinion, the management report for the Group is consistent with the consolidated financial state-ments. The disclosures pursuant to Section 243a UGB (Austrian Commercial Code) are appropriate.

Vienna, April 17, 2014

BDO Austria GmbH Wirtschaftsprüfungs- und Steuerberatungsgesellschaft

Mag Markus Trettnak Mag Bernd Winter Austrian Certified Public Accountant Austrian Certified Public Accountant Auditor Auditor

118

C.A.T. OiL Ag 2013

ANNUAL REPORT 2013 | STATEmENT OF ALL LEgAL REPRESENTATivES

We confirm to the best of our knowledge that the consolidated financial statements give a true and fair view of the assets, liabilities, financial position and profit or loss of the group as required by the applicable accounting standards and that the group management report gives a true and fair view of the development and performance of the business and the position of the group, together with a description of the principal risks and uncertainties the group faces. We confirm to the best of our knowledge that the separate financial statements give a true and fair view of the assets, liabilities, financial position and profit or loss of the parent company as required by the applica-ble accounting standards and that the management report gives a true and fair view of the development and performance of the business and the position of the company, together with a description of the princi-pal risks and uncertainties the company faces.


The Board of Directors of C.A.T. oil AG

STATEmENT OF ALL LEgAL REPRESENTATivES

Manfred Kastner

Chairman of the

Management Board

Anna Brinkmann

Member of the

Management Board

Leonid Mirzoyan

Member of the

Management Board

Ronald Harder

Deputy Chairman

of the Manage-

ment Board

119

C.A.T. OiL Ag 2013

ANNUAL REPORT 2013 | gLOSSARy

gLOSSARy

bARRELAn US-American unit of volume measure for oil and petroleum products, an equivalent of 42 US gallons (158.97 liters)

bARRELS OF OiL EqUivALENT / CRUdE OiL EqUivALENTBarrels of oil equivalent / crude oil equivalent is a unit of volume measure used by oil and gas companies in their financial reports to define a common ground for oil and natural gas reserves and production figures.

bROwNFiELdActivities in existing oil and gas fields

CATKONEFTWholly owned operating subsidiary of C.A.T. oil AG since 2002. Based in Kogalym, West Siberia, the com-pany was originally founded as a joint venture with Kogalymneftegaz, a predecessor of Lukoil-West Siberia.

CATObNEFTWholly owned operating subsidiary of C.A.T. oil AG since 2004. Based in Nishnevartovsk, Russia, the com-pany was founded 1993 as a joint venture with Priobneft, a production subsidiary of TNK, a predecessor of TNK-BP. In 2009 CATOBNEFT merged with FilOrAm.

C.A.T OiL LEASiNg / C.A.T. OiL TRAdiNg hOUSEWholly owned subsidiaries of C.A.T. oil AG based in Kogalym, Russia. Founded in 2006, these subsidiaries serve solely as a leasing company (Leasing) and a central procurement company (Trading), for the Group’s operating subsidiaries.

COiLEd TUbiNgA technology for stimulation of idle oil and gas wells, which involves a cable winch to run a flexible pipe into a well in order to pump fluids into a well-bore or to clean a well.

CONvENTiONAL dRiLLiNgConventional drilling is the classical technology of drilling vertical, inclined and horizontal wells for extraction of oil and gas with a depth of up to 5,000 meters.

ENERgizERA chemical substance, which enhances pressure during a hydraulic fracturing operation and improves reservoir permeability.

120

C.A.T. OiL Ag 2013


FRACTURiNg FLEETA spread of mobile technical units used locally at the well-bore in order to enhance reservoir permeabil-ity of oil and gas wells. A typical fracturing fleet consists of up to eight pumps, blenders, a sand truck, a high-pressure manifold and a data van for collection and evaluation of data.

gREENFiELdA term for investments in new oil and gas fields

hydRAULiC FRACTURiNgAn oil and gas production stimulation technology, which involves pumping liquids and chemicals into a well under high pressure to create fractures in the reservoir so that the oil or natural gas starts to flow more intensively. A successful fracturing operation enhances oil and gas flow rates three to five-times compared to pre-fracturing levels. In general, costs incurred by oil or gas producers can be recovered within a 60 to 90-day period.

iNCLiNEd dRiLLiNgSee sidetrack drilling

iNTEgRATEd PROjECT mANAgEmENT (iPm)IPM is providing single source solutions primarily using our drilling capacities on a turnkey basis. These services involve procurement, contracting and management of all third-party drilling-related services, such as programs for drilling mud, drill bit, casing and liner, downhole motors and turbines, MWD (measurement while drilling)/LWD (logging while drilling) and liner cementing.

mULTi STAgE FRACTURiNg Multi stage fracturing as opposed to single stage fracturing delivers control from the toe to the heel of the well, by controlling inflow from the multiple producing zones.

NiTROgENNitrogen is an extremely safe inert gas, which is very inactive as it involves very few chemical reactions. Ni-trogen is pumped into a borehole in order to prevent formation of explosive gas or oil mixtures. The addition of nitrogen provides energy to displace unwanted liquids or gases while considerably increasing the safety of a well service operation.

OFSOilfield services, English term for C.A.T. oil´s services.

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C.A.T. OiL Ag 2013


OOORussian term for “limited liability company”. This is the common legal form of the subsidiaries of C.A.T. oil AG.

PROPPANTMaterials such as sand or ceramic grains, which can also contain viscosity additives.Proppant is pumped after fracturing into the well-bore in order to hold a fracture open when pressure is taken off. This allows oil and gas to flow more intensively through the created reservoir fractures.

REmEdiAL CEmENTiNgA process to bond a well casing to a borehole in order to insulate oil zones from water-bearing layer of earth and rock or to close bifurcations within the borehole, by building cement scaffolds. This is an auxiliary operation provided only in association with core hydraulic fracturing services.

RigComplex technical drilling equipment

SidETRACK dRiLLiNgSidetracking is a technology which facilitates reaching new oil or gas reservoirs from the upper section of an existing well. In this way idle or inactive wells can be used to exploit new wells.

STimULATiONGeneric term for several processes to enhance productivity of existing and new oil and gas wells

TighT OiLOil found within reservoirs with very low porosity and permeability which typically will not flow to the wellbore at economic rates without assistance from technologically advanced stimulation treatments or recovery processes.

TURNKEyA turnkey or a turnkey project (also spelled turn-key) is a type of project that is constructed so that it could be sold to any buyer as a completed product.

UPSTREAmSearching for and extracting raw materials (in contrast to “downstream”: processes of converting raw ma-terials into other products and then selling them to customers.

wELL COmPLETiONThe Completion architecture is designed to ‘complete’ the well construction process by providing a conduit to allow efficient and safe transport of produced fluids (oil and gas) to surface. Effective completions strat-egies are designed to lower production costs over the life of the field.

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ANNUAL REPORT 2013 | FiNANCiAL gLOSSARy

CAPiTAL EmPLOyEdTotal liabilities and shareholders’ equity – cash & cash equivalents – current, non-interest bearing liabilities

EbiT (EARNiNgS bEFORE iNTEREST ANd TAx)Net income + income tax + interest expense

EbiTdA (EARNiNgS bEFORE iNTEREST, TAxES, dEPRECiATiON ANd AmORTizATiON)Net income + income tax + interest expense + amortization + depreciation

EbiT-mARgiN EbiTdA-mARgiN(EBIT / revenues) x100 [%] EBITDA / revenues x100 [%]

LONdON iNTERbANK OFFEREd RATE (LibOR)Libor is a daily reference rate settled in London for the international money market

NET FiNANCiAL LiAbiLiTiESInterest-bearing liabilities – monetary current assets

RETURN ON EqUiTy((Net income +/- extraordinary items) / total equity) x 100 [%]

EURO iNTERbANK OFFEREd RATE (EURibOR)Euribor is a daily reference rate in the euro wholesale money market

RETURN ON TOTAL CAPiTAL(Net income / total liabilities & shareholders’ equity) x 100 [%]

RETURN ON CAPiTAL EmPLOyEd (ROCE)(EBIT / capital employed) x 100 [%]

RETURN ON SALE(Net income / revenues) x 100 [%]

NET wORKiNg CAPiTALCurrent assets – cash & cash equivalents – current, non-interest bearing liabilities

FURThER AbbREviATiONSmEUR: million euros / TEUR: thousand euros / q1: first quarterh1: first half of the year / yoy: year on year

FiNANCiAL gLOSSARy

FiNANCiAL CALENdAR27 May 2014 First quarter interim report 2014

13 June 2014 Annual general meeting

28 August 2014 Second quarter interim report 2014

27 November 2014 Third quarter interim report 2014

iR-KONTAKT

imPRiNTPUbLiShERC.A.T. oil AGKärntner Ring 11-13A-1010 Vienna

Phone: +43 1 535 23 20 - 0Fax: +43 1 535 23 20 - 20

E-Mail: [email protected]: www.catoilag.com

EdiTORC.A.T. oil AGsection.d design.communication gmbh

dESigN ANd PROdUCTiONsection.d design.communication gmbh

PhOTOgRAPhyUlrich Lindenthal, Oleg Korolev

C.A.T. oil AGKärntner Ring 11-13A-1010 Wien

Phone: +43 1 535 23 20 - 0Fax: +43 1 535 23 20 - 20

E-Mail: [email protected]: www.catoilag.com

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