1. PRESENTATION OF PHIL. ANDREOU LTD AT THE CSE
WELCOME
PRESENTATION OF PHIL. ANDREOU LTD AT THE CSE By
Mr. Philokypros Andreou – Executive Chairman & Managing Director
Mrs Marianna Nicolaou – Client Service Manageress
Mr. Marios Tornaritis – Financial Manager
Mr. George Demetriou – Atlantic Financial Services, Company Advisors

2. PRESENTATION OUTLINE
 1.     INTRODUCTION
 2.     BACKGROUND & HISTORY
 3.     GROUP’S STRUCTURE
 4.     CORPORATE GOVERNANCE ISSUES
 5.     FINANCIAL & OPERATIONAL INFORMATION AND ANALYSIS
 6.     PRESENTATION OF EACH GROUP COMPANY AND MAJOR DIVISIONS
 7.     CLOSING STATEMENT
 8.     QUESTIONS

3. BACKGROUND & PROFILE
Phil. Andreou Ltd. commenced its operation in 1987 operating from a small factory and employing less than 20 people producing mainly wire display stands.
Today Phil. Andreou Ltd., a public CSE listed company (since July 2000), is running a multi million operation in manufacturing and trading globally display stands, shelving, shop fittings and promotional items as well as a fully equipped Digital Printing operation.
After the listing and the injection of new funds, Phil. Andreou Ltd. has pursued its strategy of widening the solutions provided to its Clientele, by setting up two new 100% subsidiaries, namely Phil-o-Media Ltd, dealing with media, and Phil-o-Net Ltd dealing with internet services.
    

4. BACKGROUND & PROFILE
Within 2002, Phil. Andreou Ltd. along with other strategic partners, set up a new company (70% subsidiary), the So Easy Kiosks Ltd, which is primarily operating and managing a network of kiosks and convenience stores.
By 2003, Phil. Andreou Group, the result of the horizontal and vertical diversification, consists of six companies, employing over 200 people. In general Phil. Andreou Ltd. mission is to provide solutions to its Clientele in promoting and marketing their products as effectively and efficiently as possible in addition to providing best quality service to consumers.
Next slide is a chart presenting the Group and the associated divisions of each Company

5. GROUP STRUCTURE

6. Board of Directors Philokypros Andreou – Chairman & Managing Director
CORPORATE GOVERNANCE
Board of Directors
Philokypros Andreou – Chairman & Managing Director
Heros Miltiadous – Member
Maria Andreou – Member
Andreas Theophanous - Member
Andreas Kizourides– Member
Zenos Lemis - Member

7. CORPORATE GOVERNANCE
Phil. Andreou Ltd adopted the Corporate Governance Code on 21 April 2003 and the committees are the following:
Membership of the Appointments Committee
Chairman Mr. P. Andreou
Members Mr. Α. Theofanous
Mr. H. Miltiadous
2. Membership of the Remuneration Committee
Chairman Mr. Z. Lemis
Members Mr. A. Kizourides
Mr. A. Theofanous
3. Membership of the Audit Committee
Chairman Mr. H. Miltiadous
Members Mr. Z. Lemis
Mr. A. Kizourides

8. CORPORATE GOVERNANCE
In all committees the Secretary is Primenet Secretarial Ltd.
4 Corporate Governance Compliance Officers
The Finance Manager Mr. M. Tornaritis.
5 Investor Relations Liaison Officer
The Chief Accountant and the Secretary Messrs Primenet Secretarial Ltd.

9. FINANCIAL & OPERATIONAL DATA

10. FINANCIAL & OPERATIONAL DATA

11. CHART

12. ANALYSIS OF DATA
Focusing on the major facts and figures from the above tables and chart, the following issues need to be stressed:
Increase in Turnover is due basically to new ventures and divisions and occurs despite the reduction in exports of display stands which was a result of:
Slowdown of international and Cyprus economy in conjunction with Iraq crisis.
Boycotting of American products in the Middle East urging suppliers to spend less on promotional means.
Weakening trend of US Dollar against CYP Pound.
Increased competition from local manufacturers in Middle East offering poor quality but low prices.
The Company replaced part of the lost exports with exports to other countries and new Clients.

13. ANALYSIS OF DATA
Decrease in Gross Profit over the last 2.5 years
Substantial increase in fixed production overheads mainly depreciation (2000: 260k 2002: 650k) and payroll cost, due to the establishment of many new Divisions with associate heavy investment in machinery and human resources.
Short-term increase in turnover not proportionate to the increase in fixed costs. A major reason is that many of the new ventures are still under development
So Easy Kiosks, one of major investments, is in loss since it is only in its first year of operation. Moreover expected gross profit margin of So Easy Kiosks Ltd is much lower than the margin on Phil. Andreou Ltd other operations.
Substantial increase in prices of raw material especially metal sheet and fuel without corresponding increase in our prices due to fierce competition and economic slowdown

14. ANALYSIS OF DATA
3. Decrease in Profit after tax over the last 2.5 years
Selling and administration costs increased
Due to the establishment of many new divisions with associate increased requirements for back-office and sales support.
Compliance cost to the rules and regulations due to our listing
Exports subsidy removed since 2001
4. Gearing and hence financial risk is low for the Group.
5. The heavy investment and development of new Divisions and Operations has enhanced our earning capacity substantially. Long-term profitability is expected to increase.
6. Pursuing at the moment organisational restructuring to advance and fully integrate new Divisions so as to take full advantage of the earning capacity of each of these Divisions

15. PHIL. ANDREOU – DIVISIONS
DISPLAY STANDS
This Division is the oldest and most prestigious within the Group.
It produces highly customised display stands for FMCG goods, exporting every year in excess of 1000 containers directly or indirectly to 110 countries on behalf of the most famous international companies in: batteries, chocolates and confectionery, soft drinks and juices, tobacco and cigarettes, health and oral care, pharmaceuticals and cosmetics, baby food and cereals, coffee and other herbal drinks, toys and other products including electrical appliances, mobile phones and accessories, watches, luggage, shoes and clothing. Exports are 75% of the production of Display Stands Division.
The Division is one-stop shop offering to study, propose, prototype attractive, efficient and cost effective displaying ideas that would increase dramatically a company's sales market share and profits of almost any product.

16. PHIL. ANDREOU – DIVISIONS
DISPLAY STANDS
Division’s, and Group’s production capacity will be increased by sqm as a third manufacturing site and warehouse is partly completed while full completion is expected by September The site will cost more than CYP 2.5m. The Division is operating today out of two modern sites, of sqm in total, employing almost 130 people in three countries.
The automation of production lines has increased significantly. The introduction of CAD/CAM systems throughout our entire production has secured us considerable business around the world. More than CYP 700k has been invested in the last 3 years in computer aided manufacturing systems. A further investment of 1m is planned over the next 3 years in this area.

17. PHIL. ANDREOU - DIVISIONS
DISPLAY STANDS
Increased competition in Middle East (traditional leaders in the area)
Tough economic conditions (Iraq war) and worldwide uncertainty along with weakening trend of USD vs EURO and CYP affected our exports
Strategy of new markets (Greece) and new Clients (secured new Clients)

18. PHIL. ANDREOU – DIVISIONS
DISPLAY STANDS - SHOWROOM

19. PHIL. ANDREOU - DIVISIONS
SUPERMARKET AND LIBRARY SHELVING
It used to be the second largest division of the Company, currently supplying not only our own retail company with all its needs, but also hundreds of Customers, both locally and overseas. We sell a number of shelving lines, all in house produced.
Studying the needs of convenience stores and other types of retails outlets, this Division has successfully designed and marketed a number of various equipment such as tobacco back-wall units with loading mechanism, modular checkout counters, biscuits FIFO dispensers and many more.
It also keeps stocks and sells ex-stocks refrigerators, motorised supermarket checkouts and other convenience stores, bakery and hypermarket equipment.

20. PHIL. ANDREOU - DIVISIONS
SHOP FITTINGS AND DECORATIONS
This Division offers full service from conceptual design to production and installation of the necessary furniture. In addition the company undertakes to provide turnkey solutions as well as project management.
We offer a big variety of systems and accessories made out of combination of materials such as metal, wood, glass and aluminium.
We cover a vast range of shop decorations from convenience stores and hypermarkets to boutiques, cafeterias, DVD shops, etc.

21. PHIL. ANDREOU - DIVISIONS
SHOP FITTINGS AND DECORATIONS

22. PHIL. ANDREOU - DIVISIONS
STORAGE & WAREHOUSING SHELVING
This Division offers storage and warehousing shelving for medium and heavy-duty applications. All these components are imported and either sold ex-stock or ordered to measure following a study of the warehouse details as well as the purpose these will serve.
We offer all type of storage and warehousing shelving. At any moment, we keep thousands of meters of such shelving in stock for immediate response and delivery.

23. PHIL. ANDREOU - DIVISIONS
PROMOTIONAL GIVEAWAYS
This Division was established to serve both the blue chip overseas Customers of Phil. Andreou Group, who need to source promotional items and distribute them around the world, along with the display stand requirements and shipments, saving in this way time and money, and small local Clients with next day delivery including printing.

24. PHIL. ANDREOU - DIVISIONS
TOOLING & INJECTION MOULDING
In 1999 the Group acquired the assets and management of a tool shop, specialising in the design and construction of industrial machinery, tools and dies. Since its acquisition the Group invested almost CYP 200k in furnishing this division with the latest CAD/CAM equipment in order to speed up production of equipment, tools and dies and extend its range.
It's responsible also for the maintenance and repair of all machinery and equipment the Group owns, and accepts the transfer of technology and expertise when the Group purchases new technology equipment.
Lastly, it designs and produces injection-moulding tools and operates a number of injection moulding presses.

25. PHIL. ANDREOU - DIVISIONS
DIGITAL PRINTING
With an investment in excess of CYP 1m, we cover a very wide spectrum of products and services from desktop applications such as flyers, tickets business cards, invitations and news bulletin, to posters, fleet graphics and megaboards, several meters wide by any length.
This Division supports our media companies by providing the optimum digital printing output for the various media means our Group possesses, supporting at the same time most of our competition in the media business. We support sign makers, graphic and advertising houses with their digital printing output needs.
However the greatest majority of Clientele is serviced directly and includes: bars and pubs, restaurants, cafeterias, nightclubs, shops and departmental stores and any professionals in general.

26. PHIL. ANDREOU - DIVISIONS
DIGITAL PRINTING
A substantial proportion of our business is committed through the Internet by accepting files for same hour and same day delivery. In addition we are in the process of applying a digital printing on demand, web-enabled application to extend further our service to the Client.
The Division recently opened its Nicosia office, which will also serve as Group’s branch in the capital.
It is worth mentioning that within the first year of operation the Division matched the sales (in value) of the at that time industry leader despite ours significantly lower prices.

27. PHIL. ANDREOU - DIVISIONS
DIGITAL PRINTING - SHOWRROM

28. PHIL-O-MEDIA - DIVISIONS
PHIL-O-MEDIA LTD
This Company provides a variety of media solutions to its Clients in order to promote and communicate their products and services to an extensive audience. Phil-o-Media's mission is to provide value added media solutions to its Clients, achieving maximum exposure in very competitive prices. Phil-o-Media operates
Sport Rolling Display systems
Trivision Signs
Info Kiosks
Outdoor signs
Indoor Rolling Display systems.
either owned directly or through joint ventures or through participation in other companies.

29. PHIL-O-MEDIA DIVISIONS
PHIL-O-MEDIA LTD
Phil-o-Media is the fastest growing outdoor and indoor Media Solutions Provider in Cyprus.
Its Clientele covers a wide spectrum of well-established business enterprises in various sectors of economic activities.
Most of the major international FMCG companies located in Cyprus use our services to promote their products increasing their sales market share.

30. PHIL-O-MEDIA DIVISIONS
PHIL-O-MEDIA - SPORT ADS & INDOOR MEDIA
Sport Advertising
Phil-o-Media Ltd promotes companies through advertising in stadiums. Promotion is being implemented via the use of “Rolling Display System”. It operates such systems in Tsirio stadium (Limassol), Neo GSZ stadium (Larnaka), Pafiako stadium (joint venture P.W Sportsvision Ltd) and Antonis Papadopoulos stadium in Larnaka (joint venture Anorthosis Media Ltd). Phil-o-Media Ltd has invested in this division more than CYP 350k
Phil-O-Media Ltd. - Indoor Media
Phil-o-Media Ltd provides Rolling Display Signs of various sizes, as well as fixed signs, for advertising in high profile and high “traffic” locations such as hotels and restaurants.

31. PHIL-O-MEDIA DIVISIONS
PHIL-O-MEDIA - OUTDOOR ADS
Phil-O-Media Ltd. - Outdoors Media
Phil-o-Media Ltd provides outdoor advertising, one of the most effective marketing tools, using various tools/vehicles of outdoor Media such as Trivision Signs, Megaboards, Fixed Signs, Info-Kiosk Trivision Signs. Phil-o-Media Ltd invested in this division more than CYP 400k.
The specific market is undergoing changes as a result of recent legislation imposed. Only four out of our 100+ signs are up to this moment affected by the legislation. These will be relocated in order to comply with the legislation.

32. PHIL-O-MEDIA DIVISIONS
PHIL-O-MEDIA - INFOKIOSKS
This is an ambitious project, with various alternative applications. It is a self-service terminal, which is placed strategically in high profile public places or private busy places, providing easy access to information, for all users. 24 hours a day, 7 days a week, info-kiosks will instantly provide memorable visual, audio and textual information. These touch screen special application computers are housed in suitable indoor or outdoor housing and accompanying advertising signs.
They provide information to tourists and locals for a wide spectrum of information including: Municipalities, Historic Sites, Weather, News, National History, Places of interest, Area information, Road Maps, Services, Transportation, Accommodation, Restaurants, Entertainment, Activities, Events and happenings, Cultural Events, Late Shopping, Useful numbers (doctors, police), Flight information.

33. PHIL-O-MEDIA DIVISIONS
PHIL-O-MEDIA - INFOKIOSKS
At the same time, Info-Kiosks will provide the ideal means of electronic advertising to all types of professionals. Currently, negotiating to set up such Info-Kiosk stations in Middle East and Northern Europe. All advertising will also be mirrored in our website
Contracts have already been signed with Municipalities of Ayia Napa, Limassol and Yeroskipou. We are also in negotiations with other municipalities and local authorities as well as other individual companies for implementing the project
The investment in this project will reach, by the end of the year, CYP 250k.

34. PHIL-O-MEDIA DIVISIONS
PHIL-O-MEDIA - SHOWROOM

35. PHIL-O-NET DIVISIONS
PHIL-O-NET LTD
Phil-O-Net Ltd provides Internet services to the Group in a business world more eager to become “e-nabled”, while total solutions are provided to its Clients in order to fulfill the growing needs for active presence in the Internet era. Phil-O-Net's mission is to provide online solutions that work. In this way, Phil-O-Net gives its Clients a competitive advantage in a value added way. Whether the Client requires basic services or a highly complex database-driven e-commerce site, Phil-O-Net's team of computer science experts will give the Clients personal and attentive service, explaining to them the process of developing their internet presence and strategy.

36. PHIL-O-NET DIVISIONS
PHIL-O-NET LTD
Phil-O-Net designs, builds, maintains, hosts, develops and markets websites for its Clients. In summary they provide a wide range of services in the areas of:
Web development and design (e-employment suite, e- classifieds)
Infokiosk applications
Multimedia production
Hosting and domain services
Internet marketing and advertising (
Phil-O-Net is handling the development and implementation of the info-kiosk project for Phil-o-Media Ltd.

37. SO EASY KIOSKS - DIVISIONS
So Easy Kiosks Ltd activities will include primarily the operation and management of a network of Kiosks and Convenience Stores.
The company was established to:
Strengthen the relations with the retail suppliers, most of which are existing Customers of the Group.
To study in depth the retail business needs of retail customers in terms of shelving, display stands and other selling aids, so as to excel them and offer them to our Clientele.
To facilitate the trade between the Group and its Corporate Clients, turning this relation into bilateral trade.
To enhance further the Group's sales of other services and products by association and bartering of products and services.

38. SO EASY KIOSKS - DIVISIONS
To lead the retail trend to where it ought to stand against or in parallel to how convenience stores and small retail outlets in developed countries and especially in the USA stand offering additional services such as courier service, DVD rental, automatic bill payments etc.
The Company currently owns and operates 12 stores, and plans to open another 3 in the near future, which are a mixture of kiosk, convenience store, bakery and patisseries, such a mixture in every case, reflecting the needs of the area each store is located.
Furthermore the Company operates stadium refreshment facilities and it is in the process of planning the building of its e-commerce shop for online ordering and home delivery.
The Group has invested CYP 500k in setting up the stores and the infrastructure. The development of the existing 12 kiosks and back office infrastructure will be completed by the end of the year.

39. CLOSING STATEMENT
CLOSING STATEMENT

40. QUESTIONS
QUESTIONS