MAKEDONSKA POSTA REPORTS PROFIT FOR 2009

A press conference of AD Makedonska posta has been held today in the Alexander Palace Hotel in Skopje. “The State Owned Joint Stock Company Makedonska posta is a public operator established by the Government of the Republic of Macedonia to render postal services in the domestic and international postal traffic” – Mr. Ejup Rustemi, the Director General said during the press-conference. Makedonska posta is the single operator for postal services in Macedonia licensed by the Agency for Posts in the Republic of Macedonia to act in the reserved postal services area. The activities carried out by Makedonska posta include universal postal services, printing services, courier services, postal financial services and other activities. Makedonska posta had negative financial results in the past few years and consequently there were low investments which was a constraining factor for undertaking more intensive development activities. Having analyzed the situation of the company and detected its development potential, the management team together with the employees maximally committed themselves to the improvement of the entire operating i.e. business conditions and achievement of positive financial results. Using its potential of 332 postal network units, over 500 counters, 2400 employees and more than 170 vehicles and following the world trends and experiences, Makedonska posta made intensive efforts in 2009 to improve the quality of the existing services, introduce new services and make them more accessible to the citizens, business entities and institutions that are users of these services. On this occasion I would like to point out the activities that had direct influence on the improvement of the entire operating of the company such as the following: - Implementation of the project “Mobile counter for pension payment at home address” in accordance with the amendments of the legislation. (This project satisfied the numerous requests of the pensioners regarding pension payment at homes address ) - Establishment of Key Accounts Center in Skopje (This Center has improved the effectiveness and accessibility of the postal services to the business entities – big users) - Setting up new postal network units and renovation of the existing ones which ensured greater accessibility to the postal network of AD “Makedonska posta”. - Measurement of the quality of the postal service for letter-post items in the domestic postal traffic (postal service quality end-to-end measurement was first made by an external firm in 2009 in order to objectively identify weaknesses and take appropriate actions to eliminate them) - Electronic personal record of the postmen (This project ensures direct and fast information about the human resources in the company and their effective reallocation) - Introduction of ISO 20000 standard making Makedonska posta the first company in the Republic of Macedonia with such a certificate - Contract with Western Union for quick transfer of money to the postal network units - Business cooperation contract with Tutunska banka - Contract regarding the commercial sale of mail boxes within the project of the Agency for Posts - “Mail box in every home” - During 2009 the negotiations with EVN Macedonia were intensified and an agreement was reached to the satisfaction of both parties regarding the delivery of the electricity bills - Intense cooperation with Balkan postal administrations by signing mutual cooperation agreements • Cooperation Agreement with Albanian Post • Cooperation Agreement with Kosovo Post • Memorandum of Cooperation with Turkish Post • Agreement on EMS items exchange with Serbian Post • Agreement on EMS Items exchange with Serbian Post The total commitment of the company’s management team and the employees gave the expected results. Makedonska posta ended the business year 2009 with a positive financial result – PROFIT. In 2009 the company achieved the following: - Total revenues in the amount of 1.366.295.712 denars which is an increase of 5.3% compared to the previous year 2008 - Total expenses in the amount of 1.328.698.038 denars which is a decrease of 1% compared to the previous year 2008. - The profit before taxation in 2009 was 37.597.674 denars. As a comparison, Makedonska posta ended 2008 with a lost of 40.290.150 denars. The special activity that I would like to emphasize is the engagement of the KPMG consulting house by the Ministry of Transport and Communications in order to make a study about the most convenient model for partial privatization of AD Makedonska posta. The fruitful cooperation with the consulting house enriched AD Makedonska posta for the first time with a comprehensive study and a five year plan containing a forecast about revenues, expenses and the financial result. This forecast provided us a conviction and a confirmation that the activities taken in 2009 ensured not only profitability but also positioned us at the level of maintainable profitability. This assures us that AD Makedonska posta will continue to successfully deal with the market challenges after the liberalization of the postal market. The positive results of 2009 are additional motivation urging us to continue with the same pace and more intensive activities in 2010. In order to achieve this, several projects are underway including the following: - Total automation of postal network units and establishment of on-line operating - Establishment of Quality Department which will carry out continuous measurement of the service quality. - Establishment of Internal Audit Department - Connecting to the international electronic network for money transfer – EUROGIRO - Cost and revenue allocation project has already been launched (according to the business activity - service, service phases and the location –organizational unit). - A special accounting system in accordance with the Law on Postal Services will be introduced in the second half of 2010 - The negotiations for partnership with the State Lottery of Macedonia are in their final stage - In 2010 Makedonska posta will be a host and a co-organizer of the International Conference on Service Quality - This year the company will join the PostEurop Project “GREEN ACTIN POSTAL CIVIL SOCIETY” financed by the EU IPA funds. - Issuing of a joint postage stamp with the postal administrations of Albania and Kosovo on the occasion of the 100th anniversary of the birth of Mother Teresa - Cooperation with the Balkan postal administrations will continue with the conclusion of an Agreement on EMS items exchange with Montenegro Post. The quality of service improvement, fast and efficient delivery with adequate information support and permanent training of the employees will continue to be the way for the implementation of the company’s vision according to which Makedonska posta should be highly professional, customer-oriented, competitive, profitable, recognizable and respected company with dedicated and motivated employees and responsible to the customers and the society. The profitable operation is not only the aim of the company but it also means taking care about the employees. Therefore the management took a decision, as a first step in that direction, to increase the salaries of the postmen as of February 1, 2010 and proclaim 15 best postmen for 2009. We plan this to become a tradition on 22 April, the day of the postal employees in Macedonia.

Date: 4/22/2010