The Company is in the process of cost optimisation. In accordance with the new Company strategy adopted for 2005-2007, all Management Board strategic, operational and financial decisions are taken in order to increase the Company value, which is crucial before its privatisation. The Management Board focuses on the key strategic areas, which within next three years shall increase the Company share value. These strategic areas include the following: development of consolidated production and distribution group, privatisation, PKE Capital Group structure optimisation, market extension, production effectiveness, effective human resources management and operations related to the completion of financing the 460-MW construction of power unit in Łagisza. Realisation of this investment will have a great impact on the power generation sector functioning in accordance with emission standards resulting from the Treaty of Accession and the EU law.

The Company upholds its forecast according to which in 2005 the Company total net profit shall be approximately PLN 250 million. The power industry characteristics account for the fact that in the second half of the year (in relation to the repair programme), the costs will be higher than during the first months of the financial period. (pag)