at a glance VIOHALCO S.A. is the holding company of the largest Greek metals processing group.

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2 CONTENTS 1. Message from the Chairman of the Board of Directors 3 2. VIOHALCO S.A Steel Operations 13 SIDENOR 13 CORINTH PIPEWORKS Copper Operations 23 HALCOR 23 HELLENIC CABLES Aluminium Operations 35 ELVAL 35 ETEM Real Estate Development Operations Viohalco Financial Statements A1 8. Investor Relations A47 9. Invitation to the Ordinary General Shareholders Meeting A48

3 2007 at a glance Activities VIOHALCO S.A. is the holding company of the largest Greek metals processing group. VIOHALCO S.A. directly and indirectly participates in over 90 companies, which operate in the fields of Steel and Steel Pipe power conduits production, Copper and Zinc Titanium processing, as well as Aluminium and Cables manufacture. The Company has recently expanded its operations to include Real Estate development. The continuous expansion of the Group's activities in international markets is corroborated by the fact that 72.4% of its turnover is generated abroad, as well as by its strong exportorientation, accounting for approximately 10% of Greece s total exports. Key Consolidated Financials (in Euro million) Turnover Earnings before taxes (EBT) 3,274 3, , Equity Total assets 1,482 1,777 1,976 3,242 3,717 4, ΕΤΗΣΙΟΣ ΑΠΟΛΟΓΙΣΜΟΣ

4 Activities during the current financial year, focuced on the rational use of inventories, further reduction of costs, implementation of new investments, enrichment of the product mix and commercial consolidation in new geographical markets.

5 1. Message from the Chairman of the Board of Directors Dear Shareholders, During financial year 2007, VIOHALCO recorded strong growth tendencies, with all its subsidiaries consolidating their position in their existing geographical markets and expanding into new ones. More specifically, markets were pre-eminently affected by raw materials price fluctuations, the unfavourable Euro-Dollar exchange rate for exports, the constant upward pressures on production and transportation costs, as well as by the slow-down in the manufacturing sector in U.S. markets. A positive development was the dynamic growth rates recorded by the markets in China, India, as well as Southeast Europe. Indeed, as regards the latter, the accession of new Member-States to the European Union marked the onset of a period of intensified growth in manufacturing activities. Within this framework, the strategic orientation of VIOHALCO s companies focused on the implementation of robust investment programmes, investing Euro 215 million in 2007, with the objective of reinforcing its competitive advantages at the production level, as well as penetrating into new geographical markets. The Group s strong export orientation is corroborated by the fact that 72.4% of turnover is generated abroad and its exports account for approximately 10% of Greek exports. As regards results, VIOHALCO s consolidated turnover posted an increase by 12.5% in 2007 compared to 2006, reaching Euro 3,683 million. Consolidated earnings before taxes and third party interest reached Euro 210 million, posting a drop by 7.5%, while Earnings before Interest, Taxes, Depreciation and Amortisation (EBITDA) reached Euro 394 million, posting a drop by 2.5% compared to those in VIOHALCO S.A. earnings after taxes reached Euro 71.5 million, posting an increase by 90%, with a proposed dividend distribution of Euro per share, increased by 56% in relation to the previous year. In 2007, SIDENOR Group further consolidated its position in the steel products sector in the markets wherein it operates, recording a 13.2% sales increase, despite the particularly competitive business environment characterising the 2nd semester of the financial year, which saw a downward trend in the demand and prices for steel products. As regards its production facilities, SIDENOR Group went ahead with the implementation of an investment programme worth Euro 105 million, with the objective of extending and upgrading its industrial plants and expanding its sales and distribution network. The following activities were implemented within the framework of the investment programme: commencement of operation of the new STOMANA INDUSTRY steel mill in Bulgaria, the new production line of the ZAO TMK-CPW plant in Russia, the new scrap feeding method at SOVEL, as well as the onset of the renovation of the welding line unit (ERW/HFI) at the Thisvi plant of CORINTH PIPEWORKS. At the same time, regarding its commercial footprint, SIDENOR created new distribution channels in Romania and Albania, through its subsidiaries SIDEROM STEEL Srl and SIDERAL ShpK, respectively. In the aluminium products sector, the business environment presented two-fold characteristics, with U.S. markets showing signs of recession and competition shifting to European markets, where the high cost of energy significantly increased the pressure on profit margins. These unfavourable circumstances were mainly offset by the more efficient utilisation of the production capacity of ELVAL Group plants, the improved product mix and the maintenance of processing prices at high levels in European markets. In this business environment, ELVAL Group posted significant growth during financial year 2007, in the range of 13.9%, while it also realised total investments to the value of Euro 48.1 million, which are included in the framework of the two-year investment plan. The main ANNUAL REPORT

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7 objective of the programme is the increase in the production capacity of the Group's plants and the improvement of their operational efficiency. In the copper products sector, HALCOR Group managed to post a 10% rise in consolidated turnover, despite the predominantly downward-drifting demand and the increased occurrence of substitution, which arose as the result of the upward evolution of metal prices during the months of high commercial activity. The improved productivity of HALCOR plants, as well as those of its subsidiary, HELLENIC CABLES, the successful utilisation of the synergies arising between the companies and reinforcement of the scrap procurement network from international markets, in order to streamline production cost, all made a decisive contribution to the above rise. Within 2007, HALCOR Group implemented an investment programme to the total value of Euro 35 million, Euro 12 million of which concerned the production facilities of the parent company, Euro 9 million the HELLENIC CABLES Group and Euro 13 million SOFIA MED subsidiary, with the objective of producing higher value added industrial products. In the Real Estate development sector, VIOHALCO continued its fixed assets commercial utilisation strategy into Our moves in implementing said strategy concerned, firstly, the delivery of The company actively participates in the recycling of copper, aluminium and steel scrap products a section of the shopping centre built on Kifissou Avenue, in which the second IKEA store in Athens began operation, while, on the other hand, we have kept up our efforts to optimise utilisation of our other real estate assets. In total, VIOHALCO continued the implementation of its investment planning into 2008, in a consistent and unswerving manner. Activities during the current financial year, focused on the rational use of inventories, further reduction of costs, implementation of new investments, enrichment of the product mix and commercial consolidation in new geographical markets. An essential parameter in the implementation of the above growth strategy is respect towards the social and natural environment in which VIOHALCO s subsidiaries are active. Having proven its commitment to safeguarding the environment in practice, the Company actively participates in the recycling of copper, aluminium and steel scrap products, in the processing and utilisation of steel mill by-products, as well as in the recycling of metal waste. Moreover, the Company views the over 8,600 people employed at is subsidiaries as a distinct competitive advantage and constantly invests in their continuous training and education. Within this framework and given the suitable production facilities, our commitment to constantly upgrading product quality and the dynamic expansion of our commercial network, it becomes evident that all necessary conditions are met for maintaining the steady growth of VIOHALCO, both on a mid as well as on a long term basis. Nicholas M. Stassinopoulos Chairman of the Board of Directors ANNUAL REPORT

8 2.VIOHALCO Activities VIOHALCO S.A. is the holding company of the largest Greek metals processing group. Established in 1937, it has been listed on the Athens Stock Exchange since VIOHALCO S.A. directly and indirectly participates in over 90 companies, which operate in the fields of Steel and Steel Pipe power conduits production, Copper and Zinc Titanium processing, as well as Aluminium and Cables manufacture. The Company recently entered the Real Estate development sector, with the overall objective of utilising its real estate assets through its subsidiary NOVAL S.A. VIOHALCO* STEEL SECTOR COPPER SECTOR ALUMINIUM SECTOR SIDENOR* 56.75% HALCOR* 51.04% ELVAL* 64.43% REAL ESTATE DEVELOPMENT SECTOR NOVAL 100% CORINTH PIPEWORKS* 78.55% HELLENIC CABLES* 78.71% ETEM* 58.68% SOVEL 62.56% ICME ECAB 77.6% BRIDGNORTH ALUMINIUM 100% STOMANA INDUSTRY** 85.97% SOFIA MED 100% *Listed on the Athens Exchange ** 31/03/2008: STOMANA INDUSTRY 100% VIOHALCO s main subsidiaries, as well as their share structure in relation to the parent company, are as follows: Each one of the companies SIDENOR, HALCOR and ELVAL essentially constitutes a distinct Group of companies, active in the Iron, Copper and Aluminium products segments, respectively. Within the framework of the synergies achieved among all companies of the VIOHALCO Group, specific services such as raw materials procurement, market analysis, technical support, relations with banks, provisions for exchange risks and legal redress, are all carried out by a single support unit for all the companies of the Group. International Presence With production facilities in Greece, Bulgaria, Romania, the U.K., the F.Y.R.O.M. and Russia and selling products to more than 60 countries worldwide, VIOHALCO s subsidiaries are characterised by a strong export-orientation, having firmly established their robust presence in the markets where they operate. It is of great significance to note that 72.4% of turnover is generated abroad, while the Group's exports account for approximately 10% of Greek exports. 6 VIOHALCO S.A.

9 VIOHALCO has implemented total investments in excess of Euro 1 billion in the last decade. Investments A core pillar of the strong position enjoyed by VIOHALCO s subsidiaries is their objective competitive advantage, both at productive as well as at cost-related levels. The plants of the Group are mainly characterised by increased production capacity, efficient operation, as well as flexibility regarding the product range, always subject to an overarching concern for the quality of the offered products and services. In order to maintain and strengthen this competitive advantage, VIOHALCO has implemented total investments in excess of Euro 1 billion in the last decade. In regard to financial year 2007, the total investments of VIOHALCO s subsidiaries reached Euro 215 million and are broken down as follows: Investments in Steel product activities Euro 105 million Investments in Copper product activities Euro 35 million Investments in Aluminium product activities Euro 48 million Investments in Real Estate Euro 27 million Total Euro 215 million ANNUAL REPORT

10 ELKEME carries out research on new production methods, as well as monitors the performance of final products of the Group s plants. Research With the primary objective of improving our existing products and developing new innovative solutions, VIOHALCO has founded a Centre for Metals Research and Development (ELKEME S.A.). Staffed by the most highly specialised scientific personnel and by using modern research equipment, ELKEME carries out research on new production methods, as well as monitors the performance of final products of the Group's plants. Its objective is to carry out basic research on advanced plans and techniques, with the purpose of improving the production procedure and eliminating any failures and defects. Protecting the Environment - Recycling VIOHALCO s subsidiaries, recognising the importance of respecting and safeguarding the wider natural environment wherein they operate, have included their environmental performance enhancement activities in the framework of their day-to-day operations, attributing special emphasis to cutting back on the utilisation of natural resources. VIOHALCO s special attention to environmental protection is evinced by the fact that most of its production units have already been certified according to the EMAS and ISO Environmental Management Systems, with its remaining units currently undergoing the certification process. Recycling Activities in the Steel Products Segment Today, SIDENOR Group is the largest steel scrap recycler in Greece and one of the largest in the Balkans. More specifically, through the steel production facilities in Thessalonica, Almyros and Pernik, the Group recycles over 2.2 million tons of scrap metal on an annual basis, converting them into usable iron end-products. 8 VIOHALCO S.A.

11 The Sidenor Group is the largest steel scrap recycler in Greece and one of the largest in the Balkans. Moreover, the scope of its subsidiary AEIFOROS S.A. regards the recycling and utilisation of the by-products arising as a result of the production process at the Group s plants, thus significantly reducing their impact on the environment and their overall environmental footprint. Recycling Activities in the Copper Products Segment Within the framework of their production process, HALCOR s subsidiaries recycle significant quantities of scrap copper in an environmentally friendly manner, while special care is taken to cut back on waste production, by means of an extensive industrial and urban wasterecycling programme. Recycling Activities in the Aluminium Products Segment As of 2004, the Aluminium Can Recycling Center (CANAL S.A.), with the annual capacity of 2,800 tons of used aluminium cans, has been operating in Maroussi. The cans purchased and collected at the Center undergo initial processing and are subsequently transported to the ELVAL plant in Oinofyta, where they are recast in order to produce recycled aluminium, thus significantly contributing to reducing consumption of natural resources, as aluminium recycling saves 95% of the energy required for primary aluminium. ANNUAL REPORT

12 VIOHALCO Consolidated Key Financials Consolidated Key Financials (amounts in thousand Euro) Turnover 2,331,471 3,274,356 3,683,329 Gross Profit 307, , ,777 Earnings before Interest, Taxes, Depreciation & Amortisation (EBITDA) 219, , ,784 Earnings before Interest & Taxes (EBIT) 102, , ,219 Earnings before Tax (EBT) 59, , ,950 Earnings After Taxes & Minority Rights (EATAM) 20, ,153 83,958 Financials Evolution (%) Turnover 8.2% 40.4% 12.5% Gross Profit -10.5% 63.3% 0.0% Earnings before Interest, Taxes, Depreciation & Amortisation (EBITDA) -15.5% 84.6% -2.6% Earnings before Interest & Taxes (EBIT) -31.0% 173.3% -5.0% Earnings before Tax (EBT) -43.0% 282.1% -7.5% Earnings After Taxes & Minority Rights (EATAM) -79.8% 459.6% -25.8% Profit Margins (%) Gross Profit 13.2% 15.3% 13.6% Earnings before Interest, Taxes, Depreciation & Amortisation (EBITDA) 9.4% 12.4% 10.7% Earnings before Interest & Taxes (EBIT) 4.4% 8.6% 7.3% Earnings Before Tax (EBT) 2.5% 6.9% 5.7% Earnings After Taxes & Minority Rights (EATAM) 0.9% 3.5% 2.3% Consolidated Key Financials VIOHALCO s consolidated financial results for financial year 2007 were affected by raw materials price fluctuations, the unfavourable Euro-Dollar exchange rate for exports, as well as by the upward pressures on production and transportation costs. During financial year 2007, consolidated turnover posted a 12.5% increase, reaching Euro 3,683 million, as against Euro 3,274 million in Earnings Before Interest, Taxes, Depreciation and Amortisation (EBITDA) amounted to Euro 394 million, compared to Euro 404 million in 2006, posting a 2.6% drop. Finally, Earnings After Taxes and Minority Rights (EATAM) amounted to Euro 84 million, compared to Euro 113 million in 2006, posting a 25.8% drop. Consolidates Key Financials EARNINGS AFTER TAXES & MINORITY RIGHTS (EATAM) EARNINGS BEFORE TAX (EBT) EARNINGS BEFORE INTEREST & TAXES (EBIT) EARNINGS BEFORE INTEREST, TAXES, DE- PRECIATION & AMORTISATION (EBITDA) GROSS PROFIT VIOHALCO S.A.

13 Consolidated Balance Sheet Data (amounts in thousand Euro) ASSETS Fixed Assets 1,786,697 1,784,679 1,860,756 Inventories 682, , ,043 Financial assets 59,830 48,036 49,446 Receivables from customers 344, , ,246 Other assets 369, , ,925 TOTAL ASSETS 3,242,174 3,716,604 4,014,416 LIABILITIES Long term liabilities 989,335 1,102,235 1,105,922 Suppliers 141, , ,286 Short term bank loans 489, , ,170 Other short term liabilities 140, , ,502 Total liabilities (a) 1,760,137 1,939,663 2,038,880 Company Shareholders Equity (b) 973,563 1,089,111 1,228,470 Minority Interest (c) 508, , ,066 Total Equity (d) = (b) + (c) 1,482,037 1,776,941 1,975,536 TOTAL LIABILITIES (e) = (a) + (d) 3,242,174 3,716,604 4,014,416 Consolidated Cash Flows (amounts in thousand Euro) Operating Cash Flows 26,394 95, ,268 Investment Cash Flows -93,113 4,353-92,264 Financing Cash Flows 67,262 50,127 71,892 Total Cash Flows ,395 91,896 Cash and cash equivalents, beginning of period 82,770 83, ,709 Cash and cash equivalents, end of period 83, , ,605 Turnover Sales Analysis 2007 (Amounts in million Euro) % % % Copper Products 33% Other 4% 40,4% Aluminium Products 26% Steel Products 37% Profit Margins 15.3% 13.6% 12.4% 10.7% EARNINGS AFTER TAXES & MINORITY RIGHTS (EATAM) 9.4% 13.2% 8.6% 6.9% 7.3% 5.7% EARNINGS BEFORE TAXES (EBT) EARNINGS BEFORE INTEREST & TAXES (EBIT) 4.4% 2.5% 0.9% 3.5% 2.3% EARNINGS BEFORE INTEREST, TAXES, DE- PRECIATION & AMORTISATION (EBITDA) GROSS PROFIT ANNUAL REPORT

14 Financial Indexes Liquidity Indexes General liquidity (x) Special liquidity (x) Activity Indexes Inventory Turnover Rate Days Receivables Collection Rate Days Liabilities Payment Rate Days Viability Indexes Debt to Equity (x) Coverage of Financial Expenses (x) Performance Indexes ROE % 1.4% 6.4% 4.2% ROA % 0.6% 3.0% 2.1% Dividend per share Euro Number of Shares: 199,474,091 Share Symbols: BIOX (Athens Stock Exchange) VIO.AT (REUTERS) BIOX GR (BLOOMBERG) VIOHALCO Board of Directors VIOHALCO s Board of Directors is composed of the following members: NICHOLAS STASSINOPOULOS, IOANNIS FIKIORIS, EVANGELOS MOUSTAKAS, ZACHARIAS CHATZIPANAGIOTOU, GEORGIOS GONDIKAS, ATHANASSIOS PAPASPIROU, CHARALAMBOS METAXOPOULOS, GEORGE ROSENFELD, JEAN-PIERRE DE LAUNOIT, President, Executive Member Vice-President, Non Executive Member Executive Member Independent, Non Executive Member Independent, Non Executive Member Non Executive Member Non Executive Member Non Executive Member Non Executive Member 12 VIOHALCO S.A.

15 SIDENOR Group products stand out for their relialability and top quality. 3. Steel Operations SIDENOR Activities The SIDENOR Group constitutes VIOHALCO s steel arm, active in the production, processing and trade of steel products. SIDENOR's product range includes concrete reinforcing steel, mesh products, steel pipes, tubes, hollow structural sections (HSS), cables and welding electrodes, while its main areas of activity are outlined below: steel products segment, pipeworks segment, steel by-products processing segment product sales and distribution segment. Both parent Company SIDENOR, as well as its subsidiary CORINTH PIPEWORKS, are listed on the Athens Stock Exchange. Products SIDENOR Group products stand out for their reliability and top quality. They are produced in accordance to the strictest specifications and their qualitative superiority is proven in practice by their commercial success in the worldwide geographical markets wherein the Group operates. ANNUAL REPORT

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17 SIDENOR products and those of its subsidiaries can be classified into the following major categories: Integrated SD Reinforcing System: Merchant bars: Wire Rod: Steel Pipes Hollow Structural Sections (HSS): Hot Rolled Flat Products: Other products: SD Reinforcing Steel, SD Reinforcing Mesh for Columns and Beams, SIDEFIT Special Mesh, Structural and Common Mesh, SIDEFOR Prefabricated Steel Reinforcing Cages, INOMIX Steel Fibres, Welded Meshes. Square Cross-section Bars (Square), Flat Rolled Members (Flat), Round Members (Tube), Equilateral Cross-Section Bars (Corners), IPE Beams and UPN Channels. SIDENOR s wire rod covers all low-carbon cableproduction needs. Steel Pipes of Medium and Large Diameter, Network Steel Pipes of Small Diameter, Steel Pipes for Manufacturing purposes - Hollow Structural Sections (HSS). Steel Sheets or Plates Wire Products (galvanised and non-galvanised), Welding Products, Special Steel Products, Metallurgical Operations By-products Processing. Production Facilities The SIDENOR Group operates production units in Thessalonica, Almyros, Kilkis, Halkida, Thiva, Thisvi, Pernik in Bulgaria, Nikolic in the F.Y.R.O.M. and Polevskoy in Russia, constituting the largest steel products producer in Greece and one of the largest in Southeast Europe. The new steel mill of STOMANA INDUSTRY subsidiary begun operation in Bulgaria in early 2008, increasing its annual long product production capacity to 1,000,000 tons, while annual flat rolled products capacity stands at 400,000 tons. Moreover, the first stage in the upgrading of the DOJRAN STEEL plant was concluded and the new scrap feeding method begun operation at SOVEL's production unit in Almyros. The investment in a new compact mill was also concurrently undertaken at the latter unit, which will enter productive operation in early Furthermore, the upgrade of the line pipe Electric Resistance Welded / High Frequency Induction (ERW/HFI) unit of CORINTH PIPEWORKS in Thisvi also commenced during the current financial year, upon the completion of which the Company will dispose of the most extensive range of related products worldwide. Finally, the first production unit of CORINTH PIPEWORKS outside Greece began operation in This unit was established in the framework of the Joint Venture with Seversky Pipe Plant (SPP). SPP is part of TMK, which is the largest pipe manufacturing company in Russia and one of the three largest worldwide. Upon completion of the current investment programme ( ), the overall annual production capacity of SIDENOR Group s units will stand as follows: Steel mill 3.6 million tons annually Long product Mill 3.6 million tons annually Pipes, Tubes & Hollow Structural Sections (HSS) 970 thousand tons annually Steel Products Final Processing 560 thousand tons annually ANNUAL REPORT

18 The investment programme for the financial year 2007 amounted to Euro 105 million, while total investments implemented in the last decade at SIDENOR plants and those of its subsidiaries reached Euro 535 million. Investments One of the main competitive advantages of the SIDENOR Group is its dedication to the continuous improvement and expansion of its production units, by means of extensive investment programmes. The investment programme for the financial year 2007 amounted to Euro 105 million, while total investments implemented in the last decade at SIDENOR plants and those of its subsidiaries reached Euro 535 million. The Group s investment programmes revolve around the following fundamental principles: expanding the plants production capacity and improving their efficiency, as well as enriching the companies product range with new, innovative and high value added products. Key Financials The SIDENOR Group further consolidated its position in the markets wherein it operates, despite the unfavourable conditions predominating in international steel markets during the second semester of the financial year, which saw a sharp drop in the demand and prices for its products. 16 VIOHALCO S.A.

19 Consolidated turnover reached Euro 1,390 million, increased by 13% in relation to The above increase arose due to the increased demand for steel products, the further boost to sales in the Balkan market, the reinforcement of the flat rolled product and special steel sales of STOMANA INDUSTRY to European markets, as well as by the higher prices achieved by the CORINTH PIPEWORKS subsidiary. Turnover (Amounts in million Euro) % 1,228 1, % 28.3% Consolidated Key Financials (amounts in thousand Euro) Turnover 957,046 1,228,121 1,390,039 Gross Profit 172, , ,057 Earnings before Interest, Taxes, Depreciation & Amortisation (EBITDA) 101, , ,893 Earnings before Interest & Taxes (EBIT) 53, , ,054 Earnings before Tax (EBT) 30, , ,507 Earnings After Taxes & Minority Rights (EATAM) 16, ,180 91,638 Financials Evolution (%) Turnover 4.5% 28.3% 13.2% Gross Profit -10.9% 68.4% -0.3% Earnings before Interest, Taxes, Depreciation & Amortisation (EBITDA) -21.6% 117.2% -3.0% Earnings before Interest & Taxes (EBIT) -34.4% 218.7% -5.1% Earnings before Tax (EBT) -49.7% 366.2% -3.9% Earnings After Taxes & Minority Rights (EATAM) -72.6% 564.1% -15.3% Profit Margins (%) Gross Profit 18.1% 23.7% 20.9% Earnings before Interest, Taxes, Depreciation & Amortisation (EBITDA) 10.6% 17.9% 15.3% Earnings before Interest & Taxes (EBIT) 5.6% 13.8% 11.6% Earnings before Tax (EBT) 3.2% 11.7% 10.0% Earnings After Taxes & Minority Rights (EATAM) 1.7% 8.8% 6.6% Gross profit remained at the same levels, totalling Euro 290 million, while Earnings Before Interest, Taxes, Depreciation and Amortisation (EBITDA) fell by approximately 3%, reaching Euro 213 million. Finally, net consolidated Earnings After Taxes and Minority Rights (EATAM) amounted to Euro 92 million (Euro 0.95 per share) as against Euro 108 million (or Euro 1.13 per share) in financial year ANNUAL REPORT

20 This drop in net earnings after taxes and minority rights is attributed to the fact that a lump sum positive deferred tax to the value of Euro 22.9 million had been recognised in 2006, which had accordingly increased earnings after taxes for that period. Consolidated Balance Sheet Data (amounts in thousand Euro) ASSETS Fixed Assets and Investments 762, , ,104 Inventories 276, , ,462 Customers and other receivables 123, , ,050 Other assets 150, , ,679 TOTAL ASSETS 1,313,904 1,396,500 1,544,294 EQUITY AND LIABILITIES Long term liabilities 470, , ,977 Short term bank loans 210, , ,150 Other short term liabilities 132, , ,782 TOTAL LIABILITIES 812, , ,909 Share Capital 39,158 39,363 39,413 Other data on Company Shareholders Equity 358, , ,133 Total Company Shareholders Equity 397, , ,546 Minority Interest 104, , ,840 TOTAL EQUITY 501, , ,386 TOTAL LIABILITIES AND EQUITY 1,313,904 1,396,500 1,544,294 Strategy The main pillars of SIDENOR's growth strategy are outlined below: Strengthening the position of the Group in Greece and Southeast Europe, by means of implementing investments that will maintain costs at competitive levels and will set the foundations for the development of innovative, high value added products. Reinforcing commercial presence in Balkan markets, which are characterised by large demand volumes and high growth rates. Consolidating the position of CORINTH PIPEWORKS in the traditional geographical markets of Western Europe, the Middle East and North Africa, as well as further expanding its share in the markets of North America and Russia. 18 VIOHALCO S.A.

21 2007 marked the initiation of an investment programme worth Euro 4 million at CORINTH PIPEWORKS, for upgrading the production capacity of the large-diameter steel pipes production unit. CORINTH PIPEWORKS Activities CORINTH PIPEWORKS was incorporated in 1969 and deals in the production of high quality steel pipes used to transport oil, natural gas and water, as well as in the production of hollow structural sections (HSS) for the construction sector. It is listed on the Athens Stock Exchange. The 3-year restructuring programme of the Company was successfully completed in This programme ushered in a new dynamic growth course, which began in early 2007 and the results of which are already apparent, both at a financial and productive level, as well as at a commercial level. Products Pipes used to transport natural gas and oil, as well as steel pipes used to transport and distribute water to centres of consumption. Casing pipes used for extracting oil and natural gas. Hollow structural sections (HSS) widely used in the construction sector and especially metal constructions. They are traded under the trademark SD. At the same time, CORINTH PIPEWORKS provides a range of services to third parties, which include, among others, the interior and exterior coating of pipes produced by other pipe manufacturers, storage of pipes, procurement of pipes or assignment of pipe coating outside its product range to approved sub-contractors, as well as combined transportation of pipes. ANNUAL REPORT

22 A significant competitive advantage of the Thisvi plant is the operation of a three-pier harbour, which minimises raw material and finished product delivery times and delivery costs. Production Facilities Thisvi Plant (Greece) The production facilities of CORINTH PIPEWORKS are located in the Industrial Area of Thisvi, in the Prefecture of Viotia. They are considered one of the most modern and efficient production plants of their kind worldwide. They have a total surface of 497 square kilometres (49.7 hectares), of which 83 are covered. A significant competitive advantage of the Thisvi plant is the operation of a three-pier harbour, which minimises raw material and finished product delivery times, whilst also ensuring that transportation costs are kept at low levels. The total annual production capacity of the Thisvi plant, following the completion of the new investment in the large-diameter helical submerged arc welded (HSAW) steel pipe production unit, has reached 775,000 tons. Polevskoy Plant (Russia) The first production unit of CORINTH PIPEWORKS beyond Greek borders was established in 2007 in Russia, within the framework of its Joint Venture with Seversky Tube Works (STW), which is a subsidiary of Russian company TMK. The plant is located in the city of Polevskoy in the Sverdlovsk area, has a total annual production capacity of 200,000 tons and is dependent on the highly efficient equipment from CORINTH PIPEWORKS, which was installed at an STW production unit, for the production of ERW pipes. The Joint Venture was established in order to cover increased demand in the Russian and CIS markets. Investments 2007 marked the initiation of an investment programme worth Euro 4 million at CORINTH PIPEWORKS, for upgrading the production capacity of the large-diameter helical submerged arc welded (HSAW) steel pipes production unit by 25%. Following the completion of the above investment, said unit will have an annual nominal capacity of 375,000 tons. 20 VIOHALCO S.A.

23 Furthermore, the upgrade of the line pipe Electric Resistance Welded / High Frequency Induction (ERW/HFI) unit from 24'' to 26'' begun at the end of the third quarter of Upon its completion within the first quarter of 2008, CORINTH PIPEWORKS will offer the most extensive range of related products worldwide (external diameter up to 26'' and API steel in grades up to X80). Key Financials The financial results of CORINTH PIPEWORKS for financial year 2007 largely confirm the new growth course embarked upon by the Company, which commenced upon the completion of the 3-year restructuring programme. Consolidated turnover stood at Euro million, as against Euro million in 2006, posting an 11.9% increase. Earnings Before Interest, Taxes, Depreciation and Amortisation (EBITDA) stood at Euro 57.5 million, as against Euro 41.3 million, increased Turnover (Amounts in million Euro) by 39.3% in relation to the same period last year. Finally, Earnings After Taxes and Minority Rights 319 (EATAM) amounted to Euro 33.9 million Euro % % per share) as against Euro 36.4 million (or 18.9% Euro per share) in financial year It is noted that net earnings in 2006 were increased by Euro 17.0 million, mainly due to the lump sum positive contribution of deferred tax, as a result of the recognition of tax credits that had arisen from damages of previous financial years Consolidated Key Financials (amounts in thousand Euro) Turnover 260, , ,528 Gross Profit 55,581 73,785 84,626 Earnings before Interest, Taxes, Depreciation & Amortisation (EBITDA) 20,395 41,281 57,489 Earnings before Interest & Taxes (EBIT) 8,824 30,257 46,253 Earnings before Tax (EBT) -2,164 19,449 40,101 Earnings After Taxes & Minority Rights (EATAM) -5,651 36,424 33,971 Financials Evolution (%) Turnover 18.9% 22.4% 11.9% Gross Profit 90.7% 32.8% 14.7% Earnings before Interest, Taxes, Depreciation & Amortisation (EBITDA) n/a 102.4% 39.3% Earnings before Interest & Taxes (EBIT) n/a 242.9% 52.9% Earnings before Tax (EBT) n/a n/a 106.2% Earnings After Taxes & Minority Rights (EATAM) n/a n/a -6.7% Profit Margins (%) Gross Profit 21.3% 23.1% 23.7% Earnings before Interest, Taxes, Depreciation & Amortisation (EBITDA) 7.8% 12.9% 16.1% Earnings before Interest & Taxes (EBIT) 3.4% 9.5% 12.9% Earnings before Tax (EBT) n/a 6.1% 11.2% Earnings After Taxes & Minority Rights (EATAM) n/a 11.4% 9.5% ANNUAL REPORT

24 The increase in sales and profitability is mainly attributed to the higher pricing levels achieved by the Company, as a result of the strategic penetration into high value added markets, undertaking projects bound by strict technical specifications, as well as the favourable conditions prevailing in international energy markets. Concurrently, the financial results of 2007 were also positively affected by the continuous improvement of the Company s productivity and the streamlining of its operating cost. Consolidated Balance Sheet Data (amounts in thousand Euro) ASSETS Fixed Assets 195, , ,250 Inventories 60,621 56,984 95,863 Receivables from customers & others 85,311 65,336 66,287 Other assets 1,489 7,910 11,673 Cash and cash equivalents 4,910 8,366 11,592 TOTAL ASSETS 347, , ,664 EQUITY AND LIABILITIES Long term loan liabilities 118,384 87,320 65,579 Other long term liabilities 18,260 7,937 6,822 Short term loan liabilities 80,567 29,754 31,655 Other short term liabilities 77, , ,020 Total Liabilities 294, , ,076 Total Company Shareholders Equity 51,497 92, ,588 Minority Interest 1,514 1,494 0 Total Equity 53,011 93, ,588 TOTAL LIABILITIES AND EQUITY 347, , ,664 Strategy Given the favourable indications from international energy markets, as well as the negative consequences created from the increase in shipping fares, the rise of the Euro against the Dollar and the concentration tendency in the steel production sector, the main pillars of the strategic business planning of the Company are as follows: Reinforcement of the Company s competitive advantages, both regarding productive operation, as well as commercial presence. Commitment to the continuous upgrading of production facilities, with the aim of developing new, high value-added products. Development of collaborations for the creation of new products, based on the longestablished and close ties that the Company has developed with raw materials suppliers. Further penetration into the Russian market, within the framework of the successful entrance into the local market, with the launch of operation of the ZAOTMK - CPW production unit. Maintenance of flexibility in the production process, in order to meet the diversified needs of its customers internationally. Utilisation of the synergies developed with parent company SIDENOR. 22 VIOHALCO S.A.

25 4. Copper Operations HALCOR Activities The HALCOR Group is VIOHALCO s production and trade branch for copper products. It is a multinational Group of 20 companies and 9 production units in Greece, Bulgaria and Romania and a dynamic international commercial presence in all geographical markets associated with copper metallurgical products. HALCOR is the only company in Greece that produces copper tubes and is active mainly in the production and trade of rolled and extruded copper and copper alloy products, as well as zinc rolling products. The subsidiary company of HALCOR Group, HELLENIC CABLES, is active in the production of all types of cables, enamelled wires and rubber or plastic insulating compounds, with over fifty years experience. Both the parent Company HALCOR, as well as its subsidiary HELLENIC CABLES, are listed on the Athens Stock Exchange. Products The products of the HALCOR Group are distinguished into the following five main categories: Copper Products: Tubes, Sheets, Strips, Circles, Wire, Billets Brass Products: Tubes, Sheets, Strips, Circles, Bars, Billets Zinc Products: Sheets & Strips Special Alloy products: Plates, Billets, Strips, Circles, Blanks Cables ANNUAL REPORT

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27 The production procedure of the HALCOR units is fully vertically integrated, allowing for maximum production and processing cost management, as well as maintaining maximum flexibility at the product level. The raw material in the processing sector is copper cathodes and zinc ingots, which HALCOR mainly purchases from Chile, Bulgaria and Kazakhstan. Furthermore, copper scrap is increasingly used as a raw material, which is gathered by the Company from international markets. Production Facilities The HALCOR Group disposes of an exceedingly strong production basis, which includes 7 units in Greece and one in Bulgaria and Romania, respectively. The quality levels of the products and services provided by the Group s factories conform to the strictest requirements at international level. ANNUAL REPORT

28 The Group s main production units are the following: Production Unit Location Total Built Production Production Surface Area Capacity Objective Area (sq. m.) (tons/year) (sq. m.) 1. HALCOR Foundry, Oinofyta, 47,600 11, ,000 semi-prepared Greece products (wire, billets and plate slabs). 2. HALCOR Copper Tubes Plant, Oinofyta, 202,853 55,643 70,000 copper tubes for Greece heating, irrigation, cooling, natural gas transportation etc. 3. HALCOR Extrusion Plant, Oinofyta, 58,221 23,803 25,000 Finished Brass Greece products. 4. HALCOR Rolling Plant, Athens, 62,993 39,231 20,000 Titanium Zinc Greece Rolling Products. 5. Processing plant, Sofia, 250, , ,000 Copper SOFIA MED (Bulgaria) Bulgaria Production - copper products and copper alloys. 6. Electrical Cables, Thiva, 175,082 36,957 55,000 Cables and Control HELLENIC CABLES Greece Optical Fibres - internal installations, power cables with operating voltages over 1kV or up to1kv. 7. Copper Conductor Plant, Livadia, 121,818 13,890 14,000 Conductors and HELLENIC CABLES Greece Enamelled Grounding Cables - airway wires and enamelled cables. 8. Plastics Plant, Oinofyta, 22,032 6,636 24,000 Elastic and Plastic Greece Compounds necessary for the supply of HELLENIC CABLES for the insulation, filling and shielding production lines for the final cables. 9. Cable Plant, Bucharest, 268,000 70,000 45,000 ICME ECAB Romania (Romania) Internal Cables - installations, energy, control, industrial use and external installations, with reduced fire propagation, fire resistant. Investments The commitment of the HALCOR Group to the continuous upgrade of its production units is demonstrated by its especially wide-reaching investment programme, with a total cost for the period amounting to Euro 263 million. The programme s basic mid-term and long-term goals include the improvement of the units operational efficiency, the increase in production capacity and broadening of the Group s product range. 26 VIOHALCO S.A.

29 The amount of the investment outlays for 2007 amounted to Euro 35 million. The amount of the investment outlays for 2007 amounted to Euro 35 million, of which Euro 12 million concerned the pipe works of the parent company at Oinofyta, Euro 13 million for upgrading the production facilities of subsidiary SOFIA MED in Bulgaria, Euro 6 million concerned the production facilities of HELLENIC CABLES in Greece and Euro 3 million for the cable factory of ICME ECAB in Romania. For financial year 2008, the total amount of investment expenses is expected to reach Euro 35 million. Key Financials Turnover The consolidated turnover for financial (Amounts in million Euro) year 2007 amounted to Euro 1,369.6 million, compared to Euro 1,246.6 million 1,247 1,370 in 2006, increased by 9.9%. 75.1% 9.9% Simultaneously, we noted an increase in 712 sales volume by 10% compared to 2006, 27.2% despite the high metal prices predominating throughout the greater part of the year, which intensified substitution trends, mainly in installations products More specifically, at volume level, cable sales in 2007 constituted 35% of consolidated turnover, copper tubes stood at 28%, rolling products at 20%, brass rods and tubes at 10% and copper plates and bars at 7%. Finally, the Group's exports constituted 78% of its consolidated turnover. ANNUAL REPORT

30 All of the results were significantly affected by the inventory s Euro 10.3 million devaluation, which was implemented by the company in the 4th quarter, considering that the prices of copper as well as zinc had dropped significantly at the end of the year, affecting the results of the last quarter. Consolidated Key Financials (Amounts in thousand Euro) Turnover 711,732 1,246,578 1,369,617 Gross Profit 61, , ,587 Earnings before Interest, Taxes, Depreciation & Amortisation 47,596 95,287 86,379 Earnings before Interest & Taxes 26,122 72,677 62,691 Earnings before Taxes 12,506 51,887 33,310 Earnings after Taxes and Minority Rights 3, ,955 20,022 Financials Evolution (%) Turnover 27.2% 75.1% 9.9% Gross Profit -1.3% 93.6% -10.9% Earnings before Interest, Taxes, Depreciation & Amortisation 12.0% 100.2% -9.3% Earnings before Interest & Taxes, 6.0% 178.2% -13.7% Earnings before Taxes, -3.0% 314.9% -35.8% Earnings after Taxes and Minority Rights -75.3% 930.1% -44.3% Profit Margins (%) Gross Profit 8.6% 9.5% 7.7% Earnings before Interest, Taxes, Depreciation & Amortisation 6.7% 7.6% 6.3% Earnings before Interest & Taxes, 3.7% 5.8% 4.6% Earnings before Taxes, 1.8% 4.2% 2.4% Earnings after Taxes and Minority Rights 0.5% 2.9% 1.5% Consolidated Balance Sheet Data (Amounts in thousand Euro) ASSETS Fixed Assets 315, , ,458 Reserves 168, , ,158 Receivables from Customers 198, , ,156 Cash and Cash Equivalents 16,246 29,261 41,597 Other Assets 1,630 7,658 1,707 TOTAL ASSETS 700, , ,078 EQUITY AND LIABILITIES Share Capital 32,004 38,486 38,486 Other data on Company Shareholders Equity 153, , ,385 Minority Rights 33,836 24,624 27,779 Total Equity 219, , ,651 Long-Term Liabilities: Long-Term Loans 213, , ,123 Other Long-Term Liabilities 37,565 39,666 39,101 Total Long-Term Liabilities 251, , ,224 Short-Term Liabilities: Short-Term Loans 159, , ,241 Other Short-Term Liabilities 70, ,868 95,962 Total Short-Term Liabilities 229, , ,203 TOTAL LIABILITIES & EQUITY 700, , , VIOHALCO S.A.

31 Development of innovative, high value added products. Strategy HALCOR, as a modern, international industry, with a strong presence in the metal product markets wherein it is active, applies the philosophy of act local, think global in its day-to-day operations. In this context, the principal pillars of HALCOR Group s strategy are the following: Implementation of extensive investment programmes with the purpose of upgrading its productive units and broadening its production capacity. Continuous effort to improve production cost. Boost of the Group's commercial presence in the Greek market. Further expansion within the greater geographical area of Southeast Europe. Development of innovative high value-added products. Dedication to guaranteeing quality assurance for its products. Protection and respect of the natural and social environment. ANNUAL REPORT

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33 HELLENIC CABLES Activities HELLENIC CABLES is a subsidiary company of HALCOR active in the production of all types of cables, enamelled wires and rubber or plastic insulating compounds. Established in 1973, it has been listed on the Athens Stock Exchange since The products of HELLENIC CABLES are produced in 4 modern plants in Greece and Romania and marketed under the trade name CABLEL. Products The company produces a full range of energy cables, and is the sole producer of enamelled cables in Greece. During the last few years, the company has expanded its production basis to include the field of high voltage cables, by signing an agreement regarding technical support and know-how with Japanese company FURUKAWA ELECTRIC. The main types of products produced by the HELLENIC CABLES S.A. Group are the following: Internal installation cables Control cables Cables for industrial use and external installations Marine and offshore cables with increased fire resistance Power cables with operating voltages of up to 400KV Low smoke and fume cables with reduced fire propagation Copper, aluminium, ACSR conductors Enamelled wires Telecommunication cables Optical fibre cables Special cables Plastic and rubber insulating compounds The production procedure of HELLENIC CABLES is certified according to ISO 9001:2000, while its products and services have received the ELOT and ELOT-HAR quality certificates and the IMQ and IMQ-HAR from the Italian Institute of Quality, German marks VDE and that of the Institut fur Baustoffe, Massivbau und Brandschutz of Braunschweig, the US quality mark UL and the mark of the Cable Technology Laboratories (CTL), the French NF, British BASEC, Norwegian DNV, Czech CSN and Dutch KEMA. Production Facilities The company has production facilities in Thiva, Livadia, Oinofyta and Bucharest. The main raw material used in production is copper, aluminium, steel wires and plastic - elastic material for insulating and casing the wires. The company procures part of its raw material from HALCOR. ANNUAL REPORT

34 Electrical Cables and Optical Fibres Plant (Thiva) With a total surface area spanning 175,082 sq. m. and an annual production capacity of 55,000 tons, the electrical cable and optical fibres plant in Thiva produces control cables, internal installation cables, low smoke and fume cables with reduced fire propagation, marine and offshore cables with increased fire resistance, power cables with operating voltages of up to 400kV, as well as optical fibre cables of different types. Copper Conductors and Enamelled Wires Plant (Livadia) The Livadia plant carries out the production of grounding cables, airway wires and enamelled wires. The plant s total surface area extends over 121,818 sq. m. and its annual production capacity stands at 14,000 tons. The production process is certified according to the ISO 9001 standard. Plastic and Elastic Compounds Plant (Oinofyta) The Oinofyta plant produces elastics and plastics necessary for the supply of insulation, filling and shielding production lines for the final cables. Part of the plant s products are used in the production of HALCOR s Ecutherm and Cusmart copper tubes. The plant s total surface area spans 22,032 sq. m. and its annual production capacity stands at 24,000 tons. Cable Plant (Bucharest) The plant of subsidiary company ICME ECAB in Bucharest produces cables for internal installations, control, industrial uses and external installations, with reduced fire propagation, fire resistant and low smoke and fume, copper and aluminium conductors, mine cables, marine cables, special requirement cables, telecommunication cables, signalling, remote control and data transmission cables, as well as plastic and elastic compounds. Its total surface area spans 268,000 sq. m. and its annual production capacity stands at 45,000 tons. 32 VIOHALCO S.A.

35 Investments The HELLENIC CABLES Group has planned a Turnover (Amounts in million Euro) long-term investment programme worth a 407 total of Euro 50 million, which aims at the % essential upgrade of its production units, % both at the production capacity level as well 14.5% as at the product range expansion level. Total investments in financial year 2007 amounted to Euro 9.2 million, of which Euro 3 million concerned the installation of new equipment in the ICME ECAB cable production unit in Bucharest, and Euro million concerned upgrades to production facilities of the mother Company. Key Financials During financial year 2007, consolidated turnover posted a significant increase of 26.5%, reaching Euro million, as against Euro 321 million in The above increase is primarily attributed to the increase in demand for cables, both in the Greek as well as in the international market, as a result of the significant investments in the sectors of power grids, wind parks, oil pipes and mines. The basic products sales volume of HELLENIC CABLES Group increased by 15%. Consolidated Key Financials (Amounts in thousand Euro) Turnover 200, , ,504 Gross Profit 19,929 35,714 40,732 Earnings before Interest, Taxes, Depreciation & Amortisation 13,177 28,460 35,138 Earnings before Interest & Taxes 6,337 21,246 27,421 Earnings before Taxes 4,150 18,138 20,372 Earnings after Taxes and Minority Rights 2,990 14,935 15,991 Financials Evolution (%) Turnover 14.5% 60.1% 26.5% Gross Profit 29.3% 79.2% 14.1% Earnings before Interest, Taxes, Depreciation & Amortisation 16.4% 116% 23.5% Earnings before Interest & Taxes 32.3% 235.3% 29.1% Earnings before Taxes 93.8% 337% 12.3% Earnings after Taxes and Minority Rights -16.9% 399.4% 7.1% Profit Margins (%) Gross Profit 9.9% 11.1% 10.0% Earnings before Interest, Taxes, Depreciation & Amortisation 6.6% 8.9% 8.6% Earnings before Interest & Taxes 3.2% 6.6% 6.7% Earnings before Taxes 2.1% 5.6% 5.0% Earnings after Taxes and Minority Rights 1.5% 4.6% 3.9% Group Consolidated Earnings Before Interest, Taxes, Depreciation and Amortisation (EBITDA) stood at Euro 35.1 million, increased by 23.5%, while consolidated net Earnings After Taxes and Minority Rights (EATAM) amounted to Euro 16 million compared to Euro 14.9 million, increased by 7.1%. ANNUAL REPORT