Statement of the Supervisory Council of JSC „Olainfarm” to the General Meeting of Shareholders


Supervisory Council of JSC „Olainfarm” (hereinafter referred to as „the Company”) has reviewed the annual report and consolidated report of the Company prepared by the Management Board as well as the auditor’s statement of 2010. The Supervisory Council has also assessed the financial situation at the Company and operations of the Management Board during 2010 and has prepared this Statement.


The Supervisory Council is very satisfied with financial results of the Company achieved in 2010 and with the work conducted by the Management Board to make further improvements to Company’s financial situation. Sales, profits and margins of the Company continue improving and intensive work at introducing new products and entering new sales markets, the basis is laid for sustainability of this positive trend.  Considerable work has been done to reduce different financial risks, improve financing terms, active work has been started to accommodate structural and other resources available to the Company. During just one year several projects have been prepared targeted at more efficient use of energy and human resources.  All of the above activities have been conducted by the Management Board with full approval of the Council.


2010 will be remembered not only as yet another year of record sales and profits, but also as the first year when Management Board of the Company proposed the shareholders to pay part of the profit in dividends. Council fully backs this proposal of the Management Board and agrees to the amount of profit to be distributed. The Council fully understands all the challenges that the Company is facing when trying to enter markets that are totally new to the Company and when launching new products, therefore it respects the moderate approach taken to proposed amount of dividends.   

When assessing the Company’s sales by countries for last few years, the Council has drawn the attention of Management Board to necessity to take more active steps to reduce the dependency of sales from any single market, although launching of the sales in any new market might require significant financial resources. Council is satisfied with results already achieved with registration of new products in Serbia and Albania and hopes that sales to these countries will begin in the nearest future.  The council expects Management Board to continue investing significant effort to ensure that similar results will be achieved in other countries and other regions.


During 2010 the Council of the Company has fulfilled its duties and has supervised the work of the Company according to the legislation and the decisions of Shareholders’ Meetings; it has been reviewing financial reports and supervising the work of Company’s management.   13 Council meeting were held during the reporting period.   At the meetings the management reports, planned and actual numbers were reviewed and issues and draft decisions included in the agenda of Shareholders’ were given a prior consideration. Several decisions were taken regarding participation of the Company in projects important for Company, pharmaceutical sector and inhabitants of Olaine.   No shortfalls were ascertained in the Management Board’s activities during 2010. In its operations the Management Board has largely been consulting Supervisory Council and has been taking into consideration its suggestions regarding the further growth of the Company .


The Council would like to take this opportunity and thank the Management Board and all the people of Olainfarm for a fruitful work in 2010 and congratulate shareholders of the Company with successful results of the last year.


Chairman of the Council                      Helmuts Balderis – Sildedzis



         Olaine, April 30, 2011
         Information prepared by:
         Salvis Lapins
         JSC Olainfarm
         Member of the Board
         Rupnicu iela 5, Olaine
         Latvia, LV 2114
         Tel: +371 6 7013 717
         Fax: +371 6 7013 777