KD Group does not anticipate any problems next year

In accordance with the provisions of the Rules of the Ljubljana Stock Exchange d.d. and the ZTVP-1 (Official Gazette of the Republic of Slovenia, No. 56/99), KD d.d., Ljubljana, hereby issues the following announcement:

At today’s press conference, representatives of the KD Group summarised the Group’s performance in 2003 and presented plans for the future. Matjaž Gantar, Director of the KD Group, assessed the Group’s performance as successful. He highlighted in particular the mutual funds market, which, following moderate growth in the first half of the year, has once again flourished in recent months. He explained the role of the new legislation governing the operation of mutual funds and drew attention to the changes expected following Slovenia’s accession to the EU.

The KD Group is satisfied with its business results for 2003. This successful financial year was marked by a number of changes that significantly affected the operations of the group’s companies. KD PID was restructured into the commercial company KD Naložbe. The management of mutual funds is being intensively adapted to the requirements of the new legislation. As Matjaž Gantar, director of the KD Group, emphasised in his assessment, 2003 was also an interesting year due to the expansion of the group’s operations into South-Eastern Europe. They have obtained licences to operate in Romania and Bulgaria, and are also expecting to expand into Slovakia and Russia shortly. “By focusing on the markets of Southern and Eastern Europe, we are fulfilling an important part of our business strategy, through which we aim to become one of the leading financial companies in this part of the world,” said Gantar.

The Financial Investments Division also regards 2003 as a successful year. KD Holding increased its stakes in strategic investments in line with plans, whilst the year also saw a number of disposals, notably the sale of stakes in Postojna Cave and Dravske Elektrarne. Janez Bojc, Executive Director of the Financial Investments Division, emphasised: “This year has been characterised by a strong focus at KD Holding on improving the quality of investment management and the overall portfolio – as demonstrated by the standardisation of our operations in accordance with the ISO 9001 international quality management system. We are also pleased that operations in the markets of the former Yugoslavia are being streamlined, as evidenced by the positive business results of all companies in these markets.”

Following an exceptional end to last year, KD’s mutual funds continued to see increased investor demand at the start of this year. In the middle of the year, demand for bond funds was at the forefront, whilst in the final months of this year, investor interest has once again increased. As a result, by the end of November, total assets invested in KD mutual funds had already exceeded 50 billion tolars. KD mutual funds collectively account for around 60 per cent of the domestic mutual fund market. “The exceptional demand for this form of saving can be attributed to high returns in recent years, but above all to the continued fall in bank interest rates. We are aware that rates of return will stabilise in the coming years, but mutual funds will certainly remain one of the most important forms of saving,” explained Roman Androjna, Director of KD Investments. He also emphasised that KD Investments is rapidly adapting to the changes dictated by new legislation, and naturally intends to capitalise on the synergies brought about by Slovenia’s accession to the European Union. “Despite the anticipated arrival of foreign mutual funds on our market, we do not expect any major upheavals, and the increased competition will certainly benefit investors above all,” added Androjna.


KD Group d.d.