untitled


O2 Czech Republic a.s. 2015 ANNUAL REPORT


This version of the Annual Report is a translation from the original which was prepared in the Czech language. All possible care has been taken to ensure that the translation is an accurate representation of the original.

However, in all matters of interpretation of information, views or opinions, the Czech version of the Annual Report takes precedence over this translation.


Note:

O2 Czech Republic a.s., further below also as "O2 CZ" or "Company". O2 Slovakia, s.r.o., further below also as "O2 Slovakia".


The O2 Czech Republic Group includes O2 Czech Republic a.s. and its subsidiaries, also as "the Group" or "O2 Group".

Table of Contents Page

  1. Letter by the Chairman of the Board of Directors 5

  2. Financial and operating highlights 8

  3. Calendar of key events 9

  4. Board of Directors' Review of Business 13

    1. Separation of the Company 13

    2. Factors influencing the business and results in 2015 17

      Regulation 17

      The Czech telecommunication market 19

      1. O2 Czech Republic Group 19

        Overview of the O2 Group and the main changes in 2015 19

        Slovakia 22

        Risk management 23

      2. Products and services 25

        Consumer segment 25

        Mobile access segment 25

        Fixed access segment 26

        Corporations and government 27

        ICT 28

        Payment and financial services 28

      3. Comments on the financial results 29

      4. Corporate Social Responsibility (CSR) 34

        1. O2 Group Business Principles 34

        2. Market conduct and consumer care 34

        3. Caring for employees and the workplace environment 35

        4. Caring for the environment 36

        5. Caring for the communities 37

        6. Corporate governance 39

          1. Corporate governance of the O2 Group 39

          2. Subsidiaries and ownership interests in other companies 39

          3. Organisation structure of O2 Czech Republic a.s. 42

          4. Governing bodies and executive management of the Company 44

            General Meeting 44

            Board of Directors 46

            Supervisory Board 48

            Audit Committee 51

            Executive management 52

          5. Rules of remuneration of persons with executive powers 54

          6. Other information related to persons with executive powers 56

          7. Information on corporate governance codes of the Company 57

          8. Information on internal control principles and procedures 58

          9. Information required by the Capital Markets Undertaking Act 58

          10. Financial part 64

            1. Consolidated financial statements for the year ended 31 December 2015

              prepared in accordance with International Financial Reporting Standards 64

            2. Financial statements for the year ended 31 December 2015 prepared

              3. in accordance with International Financial Reporting Standards 144

            3. Other information for shareholders and investors 216

            4. Declaration of persons responsible for the Annual Report 223

              5. Appendix: Report by the Board of Directors of O2 Czech Republic a.s. on relations between the controlling person and controlled person and between the controlled person and persons controlled by the same controlling person for the accounting period of 2015 pursuant to Sec 82 et seq. of the Act No. 90/2012 Coll., on Commercial Companies

              and Cooperatives, as amended (the "Report on Relations") 224

            O2 Czech Republic a.s. issued this content on 18 February 2016 and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on 18 February 2016 15:37:09 UTC

            Original Document: http://www.o2.cz/_pub/57/9c/e5/462174_1121722_VZ15_EN_18_02.pdf