Annual Report - 2008Eng

7/30/2019 Annual Report - 2008Eng

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THE ANNUAL REPORT 2008

ELECTRICITY DISTRIBUTION COMPANY

Public Shareholding Company


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His Hashemite Majesty, King Abdullah (II)

Bin Al-Hussein

(May Allah Bless & Safeguard Him)


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4THE ANNUAL REPORT 2008


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5

Electricity Distribution Company

Board of Directors 6

A message from the chairman of the board of directors 7

The Company Executive Management 13

Scope of Our Activities 21

The Organizational Framework of the company for the Year 2008 22

The Administrative Achievements 23

Commercial Achievements 27

Technical Achievements 31

Financial Performance Indicators 44

The Year 2008 in Numbers 45

The Independent Accounts Auditor Report 50

Financial Statement 56

Conrmation of the Board of Directors 72

Recommendations 73

EDCO Headquarters and Branches Addresses 74

Table of Contents


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Board of Directors

First: Between (1/1/2008 1/7/2008) Hashemite Kingdom of Jordan Government, represented by Messrs:

Second: Between (13/7/2008 31/12/2008) Kingdom Electricity Company, represented by Messrs:

- His Excellency, Mr . Abdul Karim Abdul Rahman Salameh Al Malahmeh (Chairman of the Board of Directors)

- His Excellency, Dr.Shabeeb Ammari (Chairman of the Board of Directors for Jordan

Telecom Company)/Vice Chairman of the Board

of Directors

- His Excellency, Engineer Marwan Abdullah Mohammed Bushnaq (General Manager of Jordan Electricity Company/

Member)

- His Excellency, Engineer Munthir Ali Al Mutlq Khleifat (Member)

- His Excellency, Engineer Omar Mahmmoud Al-Rousan (Aqaba Special Economic Zone Authority

Representative / Member)

- His Excellency, Mr/ Issa Saleh Yaseen (Ministry of Finance Representative/ Member)

- His Excellency, Engineer Mahmoud Al-Ees (Planning Manager - Ministry of Energy and

Mineral Resources /Member)

His Excellency, Mr / Abdul Karim Abdul Rahman Salameh Al Malahmeh (Chairman of the Board of Directors)

His Excellency, Dr / Adnan Mohammed Hassan Sa'ad (Vice Chairman of the Board of Directors)

His Excellency, Mr / Mohammed Oudah Hassan Al-Najadat (Member)

His Excellency, Mr / Saad Adnan Saeed Abu Oudah (Member)His Excellency, Engineer / Ahmad Ali Sa'ad Theinat (Member)

His Excellency, Mr / Saleh Ali Ou'dah Al-Hlalat (Member)

His Excellency, Mr / Khalid Mohammed Oudeh Al-Qar'an (Member from 31 /7/ 2008)

General Manager

His Excellency, Engineer Mohammed Ameen Abdul Al-Hath

Al-A'arif Al-Freihat

Accounts' Auditors

Messrs.: Talal Abu Ghazaleh & Associates Company


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7


In the Name of Allah, the Most Gracious, the Most Benecent

Distinguished Shareholders:

On behalf of the Directors, I have the pleasure of putting in your hands the tenth annual report on

the Company performance and achievements, published as at the end of the scal year 2008, and the

nancial statements of the year ending on 31/ 12/ 2008 plus estimates for the year 2009.

The Distribution Company is keen to maintain the momentum of progress and prosperity, which

stems from the vision it has adopted towards achieving distinction in presenting the electric energy

commodity to promote the company performance up to its best production levels in a bid to realize

nancial revenues on investments, and to boost its competition abilities. This care reects the Company's

determination to conduct its responsibilities and mission as assigned to it in the eld of managing one

of the most vital facilities in the country, to match up and be closely related to the growth requirement

on the economic and social levels- along with its other fellow companies operating in the sector, thus

contributing to the overall course of progress and promotion of Jordan. .

The year 2008 witnessed a signicant development in the Company, being the conclusion of its

privatization process in line with government plans and programs concerning the electricity sector re-

structure and privatization, ratied in mid-1990s. The electricity sector privatization decree ratied by

the prime ministry in 2001 and the public interim electricity law ratied in the same year which came

to be one of the requirements and means for executing this strategy, and a guarantee for the electrical

sector organizing board. As I have mentioned, the privatization of the Company was completed upon

signing the agreements related to the sale process and the accomplishment of all the procedures required

for transferring the ownership of the Distribution Company with percentage of 100% to the investor

Kingdom Electricity Company on 2 / 7 /2008.

During 2008, the Company continued to promote and utilize signicant achievements in the technical,

administrative and nancial elds that the Company undertook. This report reects the most outstandingresults, gures and indicators on the size and levels of achievements in spite of the difculties and

challenges facing the Company. One of the most prominent difculties is the problem of the commercial

electrical loss ascribed to illegal electrical energy consumption and the disorders in the electrical tariffs.

A part of these disorders was treated in the tariff framework approved on 14/ 3 /2008 .

A message from the Chairman of the Board of Directors


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Honorable Shareholders:

The Company was able to depend on its own resources and available capabilities when executing

its projects, implementing its various work programs and achieving its goals, by depending on itsqualied and competent cadres. The Company does its best to take care of, to motivate and qualify

these cadres to keep up with the increasing development and demands of loads, especially in Aqaba

Special Economical Zone and some other development Zones. Besides achieving these projects, the

Company's continues to maintain high standards of networks performance, decreasing the electrical

interruptions to the minimum possible limits and limiting electrical loss to acceptable frames despite

the great transgressions of illegal energy drawing by some people. This has become especially acute

after the rise of fuel prices. Moreover, the Company followed all the available means to boost the

relationship with its consumers, realizing that their satisfaction on the commodity quality and the

rendered service is a crucial element of its success. On the nancial side, the ability of the Company, to

realize good nancial revenues on investments, was promoted. Accordingly, the Company over passed

the problem it was suffering from in previous years, being its inability to realize operational prots due

to the disorders in the electrical tariff. The Company was able to realize after tax prots of JD (4.101)

million as at end of 2008 with a remarkable increase over prots achieved during the year 2007.

The Company continues to uphold its relationship with public departments, whether esponsible for

setting policies or organizing and controlling it. The Company renders great attention and due care to

this relationship to consolidate all efforts towards serving the goals of this sector and realizing the legal

interest with the maximum degrees of efciency and transparency. Moreover, the Company believes

in its ability to face future with complete trust and condence achieving further development, progress

and success.

In conclusion, I am pleased to extend my utmost congratulations to the executive core and members

of the Kingdom Electricity Company on all their achievements and incessant efforts in making the work

ow of this Company successful. Furthermore, I am pleased to convey my thanks and appreciation to

all the brothers and colleagues in the Board of Directors, the Director General, his assistants, executive

directors, all ofcials and employees therein for the blessed efforts and incessant contributions that

resulted in achieving distinguished successes this year. We hope that this Company will achieve all

progress and prosperity, and to share in building Jordan under the enlightened leadership of His MajestyKing Abdullah II, May Allah save & protect him for the safe of this country.

Chairman of the Board of Directors

Abdul Karim Abdul Rahman SalamehAl Malahmeh


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Board of Directors / Kingdom Electricity Company Representatives

His Excellency, Mr. / Abdul Karim Abdul Rahman Salameh Al Malahmeh/Chairman

Date of Birth: 1952 Date of Membership: 13/7/2008

B.A in Sociology / Faculty of Arts from Baghdad University, B.A in Law from Beirut Arab University and High Diploma

in Management - Jordan.

Practical Experiences:

1975 1995 held several administrative positions in Al-Karak Governorate where he was promoted from districtdirector to province director, province ruler then governor deputy.

1995-2005: he held a governor position for the following governorates, respectively: Tala, Madaba, Aqaba, Irbid andthe Capital.

7/2005 11/2005: Minister of State for the Parliamentary Affairs. From 24/6/2006 till now: board of directors chairman for the Electricity Distribution Company. Obtained the rst-class independence medal.

Former chairman of the Board of Directors in Irbid Electricity Distribution Company (2000-2002). Former chairman for the Local Council of Princess Basma for social services in many locations ( Madaba, Al-Tafeelah,

Aqaba, Irbid)

Former vice chairman of Al-Hassan City for the Youth Board of Directors / Irbid , and former member in the CentralConsultation Council Board of Directors for the Jordan University of Science and Technology and also in many

colleges' councils.

His Excellency, Dr. / Adnan Mohammed Hassan Sa'ad / Vice Chairman


PhD in Petrochemicals from Manchester University (Britain) /1976


1977 1983 Head of Petrol Section in Al-Kuwait Institution for Scientic Researches. 1983 1990 energy expert in OPEC then a consultant for oil companies in Kuwait. 1990 2003 A General Manager for different companies dealing with oil and gas in: Kuwait, Jordan, Qatar and Abu

Dhabi.

2003 till now: General Manager of Al-Sharqiyyah Company for Trading and Contracting in Jordan. He has 6 management certicates from Ohio in America and 3 appreciation certicates in General Management from

Abu Dhabi, Syria and Egypt and 3 patents registered under his name.

Board of Directors member in the Kingdom Electricity Company and member in Irbid Electricity Company board ofdirectors.

His Excellency, Mr. / Mohammed Oudeh Hassan Al-Najadat

Date of Birth: 1939 Date of Membership: 13/7/2008Master in Military & Administrative Sciences

Practical Experiences: Ofcer in the Jordanian Armed Forces. Consultant in his Royal Highness Prince Hassan ofce in the everlasting Royal Court. A member of the Jordanian Parliament. Minister of State of Mr. AbdulKareem Al-Kabarety Cabinet. Minister of State in Mr. Adnan Badran Cabinet He obtained the following medals: Military Merit/ the Jordanian Planet/ Renaissance/ Independence.


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His Excellency Engineer /Sa'ad Adnan Sa'eed Abu Oudeh


Communications Engineering Bachelor (B.Sc.) Virginia University /1988


1990 1994 designation and planning engineer in private companies in the United States of America and Jordan.

1994 1999 general manager of Qatar Company for Mobile Phones and Communication (Qatar). 2000-2007 he occupied many positions and came up the scale till he occupied the position of the executive head for

Commercial Administration in Zain International Group Companies , then an executive head for the operations in

(Fastlink )Zain Company Jordan

2008 till now: he is holding the position of the executive head in the Kingdom Electricity Company (Jordan). Irbid Electricity Public Limited Company/ Board of Directors Vice Chairman

His Excellency, Mr. / Saleh Ali Oudeh Al-Hlalat


Royal Military College Certicate/1985


1985- 2006 Ofcer in the Jordan Armed Forces (retired as a colonel). 16/6/2006 1/9/2008 administrative director in the United Arab Investors Company. 1/9/2008 till now: the ofce manager of the chairman of the board of directors/ secretary of director board in the

United Arab Investors Company.

He obtained the following medals: Military Merit / Jordan Planet/ Austrian Special Presidency Medal.

His Excellency, Engineer. / Ahmad Ali Sa'ad Theinat


Master in Electrical Engineer/1975


1965- 1969 Teacher in the Ministry of Education/ Electrical Workshops. 1975- 1984 Manager of projects in (Telefunken AEG) Company/ Germany, and representative for High Voltage

Technology Directorate in the Company.

1984- 3/2002 He was promoted in some functional positions starting from maintenance and operating as section head,and nally the region's department manager for Irbid Electricity Company.

3/2002 until now: General Manager / Irbid Governorate Electricity Distribution Company.

His Excellency, Mr. / Khalid Mohammed Oudeh Al-Qar'an


B.A in accounting from the University of Jordan in 1988 and two certicates MBA & CPA from Buffalo University at

New York State in 1990.


1991- 1994 Accounting Editor in Arthur Anderson Company. 1994 1996 the Financial and Administrative Manager in the Middle East Company for Canning (Jordan). 1996- 1999 Financial Controller for Ole Holdings Group Company (U.A.E, Dubai). 1999- 2007 Financial Manager (CFO) in transferring group then HMBS Company and member of the Board of

Directors in the International Modern Industries Company.

2007- until now: Financial Manager (CFO) in Jordan Dubai Capital Company.


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TotalTransporting

Annual

Rewards

Total of

Monthly

Rewards

Board of Directors Members' Names

JDJDJDJDUntil 1/7/2008

12900150024009000His His Excellency, Mr./ Abdul Karim Abdul Rahman

Salameh Al Malahmeh

3900150024000His Excellency, Dr./ Shabeeb Amari

3900150024000His Excellency, Engineer Marwan Abdullah

Mohammed Bushnaq

3900150024000His Excellency, Engineer Munther Ali Al Mutlaq Khleifat

3657150021570His Excellency, Engineer Omar Mahmmoud Al-Rousan

24302430His Excellency, Mr./ Shadi Abdul Salam Al-Majali

3900150024000His Excellency, Mr./ Issa Saleh Yaseen

3900150024000His Excellency, Engineer Mahmoud Al-Eees

3630010500168009000Total

From 21/7/2008

12049267809371His Excellency, Mr./ Abdul Karim Abdul Rahman

Salameh Al Malahmeh

2678267800His Excellency, Dr./ Adnan Mohammed Hassan Sa'ad

2678267800His Excellency, Mr./ Mohammed Oudeh Hassan Al-

Najadat

2678267800His Excellency, Mr./ Sa'ad Adnan Sa'eed Abu Oudeh

2516251600His Excellency, Mr./ Khalid Mohammed Oudeh Al-

Qar'an

2678267800His Excellency, Mr./ Saleh Ali Oudeh Al-Hlalat

2678267800His Excellency, Engineer./ Ahmad Ali Sa'ad Theinat

279551858409371Total

64255290841680018371Gross Total

Amounts Paid to the Board Directors' Chairman and Members

for the Year 2008

Members of the Board nancial rewards of the year2007were paid during the year 2008, but Chairman of the Board reward for the year 2008,

will be determined and distributed after General Assembly meeting as per stipulations of the companies' law.


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The Company major owners and number of their shares in the year 2008 Compared to the Year 2007:

The following are the names of the shareholders who own 5% and more of the capital of the company

and their contribution as shown on 31/12/2008.

PercentageShares Numberas shown in

31/12/2008

PercentageShares Numberon 31/12/2008

NameNo.

100%10.000.000-NoneKingdom Electricity

Company1

A list of the board of directors members' names, representatives of Kingdom Electricity Company,

administration of the executive board , the amount of their contribution and their relatives' contribution

(wife and minor children) in the capital of the company:

No of restrainedshares for

membership

SharesNumber

2007

Member type(Legal,

Natural)Name

500-Legal

Member

His Excellency, Mr./ Abdul Karim Al Malahmeh

500-Legal

MemberHis Excellency, Dr./ Adnan Mohammed Sa'ad

500-Legal

Member

His Excellency, Mr./ Mohammed Oudeh Al-

Najadat

500-Legal

MemberHis Excellency, Mr./ Sa'ad Adnan Abu Oudeh

500-Legal

Member

His Excellency, Mr./ Khalid Mohammed Al-

Qar'an

500-Legal

MemberHis Excellency, Mr./ Saleh Ali Al-Hlalat

500-Legal

MemberHis Excellency, Engineer./ Ahmad Ali Theinat

Notes: There are no contributions by the chairman and members of the board directors and the administration executive

company relatives (wife, minor children and relatives) in the Company capital.

There are no companies controlled by of the Board of Directors' members, their relatives, the executive higheradministration personnel and their relatives.

There are no contracts, projects and commitments held by the subordinate, brother and afliate companies or chairmanand members of the board of directors or the general manager or any employee in the Company or their relatives.


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His Excellency, Engineer. / Mohammed Ameen Abdul Hath Al-A'arif Al-Freihat/ General Manager

Date of Birth: 1960

Date of Appointment: 15/7/2006Electrical Engineering, B.Sc. 1988


1990- 1996 promoted up to several job positions as of an engineer of planning to the technical studiessection head, then to the technical planning departmentdirector and nally to the general director assistant

for planning affairs at the National Electricity Company ( The Jordanian Electrical Authority, previously).

7/2006- till now: The Electricity Distribution Company General Manger.

His Excellency, Mr. / Marwan Omar Mustafa Al-Aswad/ Assistant Director General for nancial affairs/

Main Ofces.Date of Birth: 1950

Date of Appointment: 1/11/1976

License in English Language and Literature


1974- 1976: he worked for the Procurement Department at the Jordan Petroleum Renery.

1976- 1993: the Materiel Section Head at the Jordanian Electricity Authority.

1993- 1999: the Tenders Commission Secretary at the Jordanian Electricity Authority then at the ElectricityGeneration Company.

2000- till now: the General Director assistant for nancial affairs at the Electricity Distribution Company.

His Excellency, Mr. / Mohammed Ya'qoub Shoumer Al-Shamaileh/ Assistant Director General for

administrative affairs/ Main Ofces.

Date of Birth: 1957


High Diploma in law studies after the rst university degree from the Higher Institute of Legal Studies and

Research / Cairo 2000.


1979 - 1981: A section head/ Ministry of Transportation. 1981- 1999 till now: promoted up to several job positions starting from an administrative, then an

administrative section head, up to acting Employees' Affairs and Training Department head for the National

Electricity Power Company and the Jordanian Electricity Authority (previously).

1999- till now: the Administrative Affairs head, then the Administrative and legal Affairs Administrativehead, then the Administrative Affairs general director at the Electricity Distribution Company.

During his service career, he worked as an administrative consultant deputized in Queen Alya' Fund for(6) months during the year 1994 and a part-time administrative consultant / member of administrative and

organizational studies commission/ Prime Ministry 1995.

The Company Executive Administration


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Engineer/ Yousef Khaleel Mohammed Al-Smadi / Assistant General Director for Technical Affairs until

15/7/2008, whereas his services end by his death, May Allah have mercy on him.

Date of Birth: 1956


Electrical Engineering, BSc / 1976

Practical Experiences: 1978 1989 He promoted in the work starting from an electricity engineer and ending with an electricity

manager of Al-Karak region in Jordan Electricity Authority.

1989 - 2000 General supervisor in Bin Laden Saudi Group.

2000 - 7/2008 He promoted in some job positions starting from a manager of consumer studies departmentand ending with a general director assistant for technical affairs in the Company until his death on

15/7/2008.

Engineer/ Reem Mohammed Sa'eed Ahmad Hamdan / Acting Assistant General Director for Technical

Affairs from 20/7/2008/ Main Ofces.

Date of Birth: 1969


Electrical Engineering, B.Sc. / 1993


1993- until now : She was promoted in some job positions starting from a studies engineer to head ofconsumers studies section then a planning department manager and ending with a technical affairs general

director assistant in the Electricity Distribution Company ( Former Jordan Electricity Authority).

Engineer/ Fawzi Mohammed Saleem Al-Hakeem / Executive Director for Al-Aqaba Electricity Distribution

Area until 15/4/2008, He is working from that Date on as a technical consultant in Al-Aqaba Area.

Date of Birth: 1948


Electrical Power Engineering, B.Sc. / 1973


1974 - 1975: He worked as supervisor engineer on the electrical installation for the Ministry of PublicWorks and Housing.

1975 - 4/2008: He was promoted in some functional positions starting from a distribution engineer thenan area manager and ending with an executive director in Al-Aqaba electricity distribution area in the

Electricity Distribution Company.

4/ 2008 - until now: A technical consultant in Al-Aqaba electricity distribution area.


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Engineer/ Adnan Fallah Muslih Al-Habahbeh / Executive Manager for Al-Aqaba Electricity Distribution

Area Executive Director as of 15/4/2008.

Date of Birth: 1958




1983 - 1990: A resident and supervisor engineer on the electrical installation works for buildings andfactories.

1990- 2002: He worked as distribution engineer then manager of Al-Tafeelah electricity area for ElectricityDistribution Company (Former Jordan Electricity Authority).

2003 2006 Substations' Department Head in Ma'an area for the National Distribution Power Company.

2007- 2008: Technical department Manager at Al-Karak electricity distribution area for the ElectricityDistribution Company.

1/2008- until now: Maintenance and Operating Department Manager then an executive manager at Al-

Aqaba electricity distribution area.

Engineer/ Yaseen Khalid Sa'eed Al-Khasawneh / Executive Director for Jordan Valley and Eastern

Electricity Distribution Area.

Date of Birth: 1955




1977- 1985 Electricity engineer in Jordan Valley Authority then at electrical and contracting projects in

Saudi Arabia. 1985- 1987 Head of electrical maintenance for a glass factory in Jordan. 1987 1995 He was promoted in some job positions starting from a distribution engineer to a Ma'an area

manager in the Jordan Electricity Authority.

1995- until now: Manager of Jordan Valley area then an executive director for the Jordan Valley and Eastern

in the Electricity Distribution Area.

Engineer/ Mohammed Mohammed Suleiman Al-Mazaydah / Executive Director for Ma'an Electricity

Distribution Area.

Date of Birth: 1957Date of Appointment: 2/12/1981

Electrical Engineering (power), B.Sc. / 1981


1981 - 1992 He was promoted in the work from an electricity engineer to a manger of Al-Tafeelah electricitydepartment in the Jordan Electricity Authority.

1992-until now: An area manager then an executive director for Ma'an electricity area in the ElectricityDistribution Area.


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Engineer/ Hassan Ahmad Slamah Thneibat / Executive Director for Al-Karak Electricity Distribution

Area.

Date of Birth: 1957


Electrical Engineering (power), B.Sc. / 1981

Practical Experiences: 1981- until know: He was promoted in some job positions in Al-Karak electricity distribution area starting

from an electricity engineer then an area manager, and ending with an executive director for Al-Karak

Electricity Distribution Company.

Dr./ Nehad Ahmad Yousef Al-Omari / Manufacturing Department Manager

Date of Birth: 1955


PhD in Civil Engineering / 1997


1981: He was promoted at the work in some job positions in the manufacturing department for JordanElectricity Authority (formerly) starting from a production engineer and ending with the manufacturing

department manager in the Electricity Distribution Company, except the period between (1986-1988),

whereas he was delegated for (C.T Main) Company, to work in designing and studying the Aqaba Thermal

Station second stage tender.

Engineer / Abdul Al-Rasul Yousef Saleh Foudeh/ Al-Tafeelah Electricity Distribution Area Director.

Date of Birth: 1954




1982- 1991: An electricity engineer worked in many projects for private companies. 1991- 2002: An electricity distribution engineer in Ma'an area then the head of the technical department in

the area.

2002- until now: Director of Al-Tafeelah area department for the Electricity Distribution Company.


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Commissions

Rewards &

incentives

JD

Shift

Allowance

JD

Traveling

Expenses

Outside

the

Kingdom

JD

Traveling

Expenses &

Transporting

Inside the

Kingdom

JD

Total of

Salaries,

allowances

& Annual

Rewards

JD

PositionName

--245015033700General Manager

Engineer. / Mohammed

Ameen Abdul Hath

Al-A'arif Al-Freihat

145

---21254

Assistant General Director

for nancial affairs

Mr. / Marwan Omar Mustafa

Al-Aswad

1050-1200-21044Assistant General Director

for administrative affairs

Mr. / Mohammed Ya'qoub

Shomer Al-Shamaileh

--140010015893General Director Assistantfor technical affairs/ till

15/7/2008

Engineer/ Yousef Khaleel

Mohammed Al-Smadi

2568-1300-12634

Acting Assistant General

Director for technical affairs

& Secretary of the Board

from 23/7/2008

Engineer/ Reem

Mohammed Sa'eed

Ahmad Hamdan

-60080020025161

Executive Director for

Al-Aqaba Electricity

Distribution Area till

15/4/2008 & Technical

Consultant in the Area now.

Engineer/ Fawzi Mohammad

Saleem Al-Hakeem

1245720140045016086

Executive Director at

Al-Aqaba Electricity

Distribution Area from

15/4/2008

Engineer/ Adnan Falah

Mousleh Al-Habahbeh

1388720140020024196


Al-Karak Electricity

Distribution Area

Engineer/ Hassan Ahmad

Slamah Thneibat

12172020025023737Executive Director for Ma'an

Electricity Distribution Area

Engineer/ Mohammed

Mohammed Suleiman

Al-Mazaydah

1846720800-21969


Jordan Valley and

Eastern ElectricityDistribution Area

Engineer/ Yaseen Khalid

Sa'eed Al-Khasawneh

375720-165014192

Director of Al-Tafeelah

Electricity Distribution Area

Department

Engineer / Abdul Al-Rassoul

Yousef Saleh Fodah

750-140020025535Manager of Manufacturing

Department

Dr./ Nehad Ahmad Yousef

Al-Omari

94884200123503200255401Total

Total Salaries, Allowances, and Rewards and Traveling Expenses Inside and Outside

the Kingdom for the Executive Management in the Company during the Year 2008


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The Company Competition Situation:

The Company has no competitor within the sector of its activity as it works within a distribution license as of

2/7/2007 within a specied region.

The Extent of Dependency on Certain Suppliers:

- The Company mainly depends on purchasing the electrical energy from the National Electricity Power

Company within a tariff specied by Electricity Regulatory Commission. Also, the Company purchases

other limited quantities from the Fertilizers' Company in Aqaba with a ratio of no more than (0.04%).

- Jordan Water Company (Miyahuna) is considered one of the Company main consumers as it purchases

(17%) of the total monthly sales of the Company for the consumption of their projects' electrical energy in

the eld of Zara Main, Al-Subaihi and Abu Al-Alzeeghan.

The Governmental Protection or Privileges Enjoyed by the Company or any of its Products

under Laws and Regulations.etc.

- The Application agreement signed between the Company and the Government of the Hashemite Kingdom

of Jordan, valid from 2/7/2008 to 31/12/2010 grants governmental protection from any nancial obligations,

occurring to the Company, of more than 200 thousand dinars as a result of taxes or fees amendments.

- The Company works under a retail distribution and supply license as of 2/7/2008, issued by the Electricity

Regulatory Commissioners Council, valid for 25 years.

- Capital commodities, materials, instruments and production material, within the core of the Company

Projects are exempted from customs' duties, public tax on sales and others under the letter of the prime

ministry cabinet no. 12/11/4/2828 on 2/3/2000.- The government guarantees that the Company will achieve minimum annual prots, for its shareholders,

based on the methodology of the electrical tariff appended to the retail distribution and supply license.

- The Company obtained no patents.

Decisions Issued by the Government, International Organizationsetc which have a Substantial

Effect on the Company or on its Products or its Competition Ability:

- The Electricity Regulatory Commissioners Council, on 28/12/2006, issued the instructions of delivery

assignments no (1) for the year 2007, enforced as of 1/1/2007.- The decision of Electricity Regulatory Commission amending the wholesale tariff of the sold electrical

power from the National Electric Power Company to the Electricity Distribution Company as of 14/3/2008

of increasing the day and night power tariff by (1.2) Fils/KWH and raising the tariff of the maximum load

from (2.4 JD/KW) to (2.98 JD/KW) monthly.

- Meters Testing and Maintenance Lab / Amman / main ofces acquired the ISO 9001 for the quality

management system at the category of the procedures related to purchase, storage, release, and issue of the

electrical power meters.


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19


Risks Facing the Company:

- There are no risks threatening the Company works.

- No operations of non-recurring nature occurred during the year 2008, are not included within the Company

main activity.

The Company Contributions:

The Company owns JD (12.03%), (300781) JD value of the electrical equipment industry shares amounting

up to JD (2.5) million. The value of each share is one dinar only. This company manufactures transformers

for distribution. This Company uses a part of its production.

The Company Subordinate Companies:

The company has no subordinate companies.

Capital Investment Size:

The capitalistic investment volume in the Company for the year 2008 amounted up toJD (16.092) million.

Auditor's Fees:

The Company accounts auditor fees during the year 2008 are JD (11440) including a sales tax of (16%).

The Company Activities in the Field of Environment Protection and Safety:

The Company is careful to execute its works within the optimal safety measures and operational efcacy

through the public safety section which supervises the following-up of the executive technical instruments

commitment of the Company various sites to the public safety principles to limit work accidents and injuries,

protecting lives and property. Moreover, the Company published a manual on the public safety regulations

and principles to be distributed to all the workers to abide by. The Company purchases clothes, tools and

safety equipment from the best manufacturing companies. Regarding environment conservation, the

Company works on reducing the usage of any material with a negative harm to the environment, spreading

health and environment awareness, continuously.

The Company Activities in the Field of Local Community Service:

The Company contributes, through its main service, in supplying the electrical current to various locations,

through reecting the importance in the public life in adopting the required infrastructure to promote

local community and its institutions. Within the policy of cooperation with the local Scocity, the company

trained (5) engineers from the Ministry of Public Works & Housing, (7) newly graduated engineers from

the engineers' association, (34) students from the universities and community colleges within the eld

training, (1) student within the Arab and foreign students' training programs and (13) female trainees from

the Vocational Training Center. Moreover, the Company presents nancial support to several beneciary

associations and supports social projects, sport and cultural clubs and national awareness programs.


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2007 (in

dinars)

2008 (in

dinars)The Beneciary Body from the Donation

1000The Sublime Thinking Institution

500The Jordanian Science & Cultural Association

300Al- Fahd Beneciary Association

300Al-Karak Sons Diwan Association/ Dabouk

500Al-Qasr Castle Beneciary Association

1000Al-Joud for Academic Care Institution

200Yanabee' Al-Khair (Blessing Fountions) Association for Zaita / Al-

Khaleel Population250300Al-Hashimiya University

150Al-Tafeelah Great Municipality

100Jordan Cancer Society

2501The Eighth Comprehensive School for Girls/Aqaba

1308859Jordan Armed Forces

500500AUB Alumni Club

83835South Shounah District Governorate

300200Jordan Iraqi Brotherhood Association

300200Sheehan Club/ Al-Karak

400Ma'an Sons Beneciary Association

2806Ma'an Municipality

250The Renewable Energy Exhibition

300Visions' Association for the Blind

100Karak Multi-purpose Cooperative Association

250The Unemployed Training and Rehabilitation Center/ Al-Karak

500Handicaps Care Association / Al Karak

300The Jordanian Football Union

300The Jordanian National Forum For Women

200Mu'ta Cultural, Sports and Social Club

500Al-Karak National Nights

200Scientic Research Friend Association

500Abu Ayoub Al-Ansari Zakat Committee

300The Jordanian Women Committee / Al-Karak Branch

3000The Jordan Cigre National Committee

750Electricity Workers Public Syndicate of Jordan

1094611851Total

Donations and Grants Presented by the Company during the Year 2008

The following table shows donations which the Company contributes in during the Year 2008, and the

bodies presented for compared with the Year 2007.


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21


The region of supplying The Electricity Distribution Company extends in the governorates

of :Al-Karak , Al-Tafeelah , Ma'an, Al-Aqaba and Jordan Valley ( from Al-Himmeh , inthe north, to the Dead Sea in the south ) and in the Eastern region areas ( Al-Rweished,

Al-Reesha, Al-Azraq, Al-Safawi ), as demonstrated in the attached layout :

Scope of Our Activities


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BoardofDirectors

GeneralManager

Manufacturing

Department

SecretariatofTenderingCommittees

LegalAffairsD

epartment

Executive

Directorfor

AqabaElectricity

DistributionArea

ExecutiveDirector

forMaanElectricity

DistributionArea

ExecutiveDirector

forJordanValleyand

EasternElectricity

DistributionArea

AssistantDirectorGeneral

forTechnicalAffairs

PlanningDepartment

Engineering

Department

Transportation

Department

AssistantDirector

Generalfor

AdministrativeAffairs

HumanResources

Department

InstitutionalServices

Department

Transportation

Department

AssistantDirectorGenera

l

forFinancialAffairs

Financial

Department

GeneralAccounts

Department

CommercialAffairs

Department

SuppliesandWarehouses

Department

AuditingCommitteeoutoftheBoard

ofDirecto

rs

InternalAuditingDepartment

TaflaElectricity

Department

TechnicalDepartment

SouthernShounahAreaElectricity

Department

TheEasternAreaElectricity

Department

FinancialDepartmentandConsumers

Services

AdministrativeServicesDepartment

TechnicalDepartment


Services


FinancialandConsumersServices

Department

ElectricityNetworksDepartment

MaintenanceandOperationDepartment



Services

WadiMusaElectricityDepartment


TechnicalDepartment

ExecutiveDirector

forKarakElectricity

DistributionArea

TheOrganizationalFramewo

rkoftheCompany

fortheYear2008


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23


Administrative Achievements

Human Resources Development

The number of employees at the Company reached (1047) employees by the end of 2008, (981) of them work

within the distribution activity and (66) work within the manufacturing activity in addition to (46) trainee-tech-

nicians. Fifty eight (58) employees Services were terminated for different reasons during this year. Therefore,

the number of employees was (1093) with a percentage of about (3.8%) less than the previous year. The

employees are distributed according to their occupational eld, geographical locations of the work area, aca-

demic and professional qualication as follows:

Table No. (1)

Number of employees in the Company, broken down according to the appointment type, during the years

(2004-2008)

Appointment Type 2004 2005 2006 2007 2008

Regular 945 1020 1005 1066 1037

Contract 54 5 3 - 10

Daily Paid 3 - - - -

Trainee 63 84 101 70 46

Total 1065 1109 1109 1136 1093

Figure No. (1)

Development in employees numbers during the years (2004-2008)


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Table No. (2)

Number of employees in the Company according to the occupation eld for the two Years (2007- 2008)

TotalSupport

services

Female/

male trainees

-technicians

Consumer

servicesComputerFinanceAdministrativeEngineeringYear

11361924911591211496722007

109316847415813114103632008

Table No. (3)

Breakdown of employees and technicians trainees according to their working Area for the two Years (2007-2008)

TotalAl-AqabaMa'anAl-TalaAl- Karak

Jordan

Valley &

the Eastern

Poles

Factory

Main

OfcesYear

113615616294209227762122007

109314416191206216662092008

Table No. (4)

Breakdown of employees and technicians trainees according to the Academic Qualication for the two Years (2007-2008)

Total

Less than

Secondary

Certicate

Secondary

CerticateDiploma

Bachelor

Degree

High

Diploma

Master

degreePhDYear

113643737612818021212007

109337040112917721312008

Figure No. (2)

Breakdown of employees according to their working Area for the - Year (2008)


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25


Training & Rehabilitation

The company has been keen to comply with the developments in the eld of training and meet the works

requirements and needs in the technical, nancial and administrative elds. It pays a great attention to train

its employees by delegating them to take part in courses, specialized seminars and ofcial missions in all

elds inside and outside the Kingdom. In compliance with the approach adopted by the Company to provide

efcient technical manpower capable of implementing plans and programs seeking to achieve, The year 2008

witnessed the follow up of (46) Electricity Training Center trainees in various Company's areas' locations.

Table No. (5)

Numbers of Employees Participating in Courses, Seminars and Ofcial Missions

DescriptionDuring 2007 During 2008

Number Participants Number Participants

Training courses 30 152 25 69

Scientic Seminars &

Conferences16 155 30 156

Outside Ofcial

Missions39 54 43 69

Total 85 361 98 294

Administrative Development:

In pursuance of the role which the Company has adopted to boost the efciency of the administrative organizationand to enhance performance and increase productivity, the Company went on revising the administrative

organization to execute the goals of the strategic plan. The most prominent accomplished modications were

as follows:

- Establishing new department of electricity distribution in Wadi Musa and Shoubak at electricity distribution

Area of Ma'an, formed of two sections: technical sections, nancial and administrative section.

- Merging Inspection and Public Safety section with engineering department within technical affairs divisions.

- Merging Inspection and Complaints sections attaching it directly to the executive directors under the title:

Inspection & Complaints Unit at the organizational level section. The job description for created jobs

and new sections was prepared.

The Organizational, Occupational Guide, Regulations and Instructions:

- Setting the strategic plan for the Company within the years (2008-2010).

- Updating the Company organizational guide for the year 2008 in the light of the modications took place

on administrative level to include the new and modied administrative units.

- Preparing draft copy for job description guide for the nancial affair divisions.

- Preparing a guide for auditing the quality management, and prepare a guide of quality assurance for the

Company.


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- Amendments were made on Human Resources Department, including the Internal Regulation for organizing

the work, Supplies & Warehouses Regulations, Health Insurance Fund Regulation, updating The Social

Insurance Regulation.

- Setting organizational instructions concerning action of inspection and complaints at Company sites,

instructions of remedial centers claims , issuance of the organizational instructions concerning the electrical

energy meters test and clearance at the main meters lab. Amendments were made on organizational

instructions related to the Company employees' travel, mobility, public safety instructions, professional

health, organizational instructions concerning granting loans, aids to the employees and updating the

organizational instructions related to delay for the formal working hours.

Employees Funds and Occupational Privileges

The Company is currently working on subjecting all its employees to the rules of the Social Security Law and

life insurance against death and accident. The employees enjoy an electric discount of (75%) of their monthly

consumption, in addition to several other benets which are mainly: social insurance, health insurance, housing,

provident fund, and health insurance after retirement.

Transportations

In harmony with the Company policies concerning boosting the facilitating services at the Company for

increasing the productivity efciency and as a result of the operating vehicles importance in Company's

various works and activities, especially the technical works at the sites, this sector realized the following

achievements:

- Increasing the dependency on the main workshop where more than 200 light, medium and comprehensive

maintenance cases were conducted.- Hiring vehicles for serving the technical workshops, and some other works in the Company in the light of

the studies' results and the economical and operational feasibility for each case, for the purpose of reducing

the capital expenses.

- Increasing the numbers of those technicians authorized to drive cars to promote their efciency, work

readiness and contribution in administrative expenses control.

- Measuring the rates of vehicles movement, and setting programs for maintenance and operation in the light

of conclusions.

- Providing the Company with nine various vehicles in addition to a forklift.

The Legal Department

The legal department, through its employee staff and the external ofces contracted within Aqaba, Ma'an,

Tafeelah, Karak, Jordan Valley and the Eastern, to follow up the multi-cases of the company as for removing

the electric lines and installations intersecting with the citizens' lands instead of paying compensations. This

decision played a big role in reducing the size of the required compensations. Replacing the lines with new

ones contributed in reducing the burden of the old lines maintenance. The department also follows up getting of

the company rights of their legal and panel aspects, and providing the required legal consultations concerning

the company' work.


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27


Consumers

During the year 2008, the electrical energy service was supplied to (8803) new consumers, (7561) of them

were installed with one phase meter and (1242) consumers with a threephase meter. Their total number, till

the end of 2008, was (163197) against (154464) in the year 2007 with a growth rate of about (5.7%).

Table No(6)

Number of Consumers in the distribution areas

Area

No of Consumers

during 2008

Accumulative No. of

Consumers by the

end of 2008 Grand

Total

2008

Growth Rate

Consumers

Rate against the

grand total %Singlephase

Threephase

Singlephase

Threephase

Karak 2206 143 48185 2637 50822 4.8% 31.1%

Al-Tafeelah 992 32 16342 701 17043 5.9% 10.4%

Jordan Valley & Eastern

Area1767 311 34152 4912 39064 5.6% 23.9%

Aqaba 1380 659 27758 5155 32913 6.6% 20.2%

Ma'an 1216 97 21595 1760 23355 6.0% 14.3%

Total 7561 1242 148032 15165 163197 5.7% 100%

Figure No (3): segment showing the consumers numbers percentage in the distribution areas by the end of 2008

Commercial Achievements


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Table No. (7)

Development of Consumers during the years(2004-2008)

Growth rate20082007200620052004Type of

Subscription

5.3%148032140541134443128192122540Single phase

8.9%1516513923130001162910632Three phase

5.7%163197154464147443139821133172Total

Figure No. (4) Growth Of Consumers Numbers During The Years (2004-2008)

Electrical Energy Purchases

The electric energy volume, purchased in 2008, was (2210.38) GWH with a value of JD (84.511) million, realizing

an increase of (9.3%) in the purchased energy volume, whereas the purchased value increase was (22.3%).

Table No. (8)

The purchased electrical energy (in GWH) and its value for the two years (2007-2008)

Year 2008Year 2007

Subscription Categories Purchased

volume (%)

Value JD

Million

Volume

GWH

Purchased

volume (%)

Value JD

Million

Volume

GWH

69.2%56.1521530.6668.8%46.7311392.47Day energy purchases

30.7%18.090678.1631.1%14.774628.40Night energy purchases

0.07%0.0591.560.1%0.0681.98Other purchased energy

100%74.3002210.38100%61.5732022.85Total

10.2117.910Peak Load

100%84.5112210.38100%69.4822022.85Total


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29


Electric Energy Sales

The volume of electric energy sold in 2008 was (1928.54) GWH for a value of JD (103.66) million, with an

increase of (8.6%), whereas the value increase rate was (27.7%).

Table No. (9)

Volume, values and ratios of the sold electrical consumption (in gwh) distributed according to the consumers'

categories for the two years (2007-2008)

Year 2008Year 2007Subscription

Categories Consumption

Rate (%)

Value

JD Million

Quantity

GWH

Consumption

Rate (%)

Value

JD Million

Quantity

GWH

37.5%29.25724.1137.4%26.64666.05Water pumps

25.9%30.92499.6326.1%23.95462.87Housing & public

buildings

12.9%20.75249.6712.4%13.62219.68Commercial & Hotels

9.1%8.78175.389.0%6.95159.32Industrial

8.1%6.97155.368.3%4.57147.50Agricultural

2.8%1.7754.903.3%1.5258.98Streets lighting

3.3%4.7962.733.2%3.6556.15The Army

0.3%0.436.740.3%0.285.77Charities

100%103.661928.54100%81.191776.31Total

Figure (5)

Electrical energy sales according

to consumption categories for the year (2008)

Figure (6)

Purchased and sold energy volume

growth in (GWH) during the years (2004-2008)


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31


Technical Achievements

Substations

The number of the new substations, constructed in 2008, was (261), with a total capacity of (105.2) MVAagainst (180) substations with a capacity of (61.2) MVA constructed in 2007.

Table No. (11)

The substations completed during the two years (2007-2008)

The end of 2008During 2008The end of 2007Voltage (KV)

KVANoKVANoKVANo

32600018003260001833/11

26000019002600001933/6.6

2500030025000333/3.3

706290244477615206628675223833/0.4

1250030012500311/6.6

390165761275705536259570611/0.4

5800800580086.6/0.4

1725755325610518526116205702995Total

The total number of constructed substations and their accumulative capacity in the companys distribution

areas, until the end of 2008 ,was (3256) substations ,with a capacity of (1725.8) MVA with an increase ratio

over the year 2007 by (8.7%) and (6.5%) in substations number and their capacity, respectively.

Medium Voltage Networks

During the year 2008, about (181) km of overhead medium voltage lines of (11

33) KV, were constructedand electried, in addition to (27) km underground cables (11, 33) KV. Also, the year 2008 witnessed the

constructed and electrication of (159) km of low overhead lines in addition to (18) km underground cables

of low voltage.


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Table (12)

Medium and Low Voltage Networks Lengths constructed During the Two Years (2007-2008)

2008 (km)2007 (km)VoltageDescription

14680Medium 33KV

Overhead Networks 3514Medium 11 KV

18194Total

1819Medium 33KV

Underground Cables 920Medium 11 KV

2739Total

2008 (km)2007 (km)Voltage

159149Low voltage overhead networks

1829Low voltage underground cables

177178Total

The total lengths of medium and low voltage lines for both overhead and underground cables were (9318) km

by the end of 2008, against (8933) km by the end of 2007 with an increase of (4.3%).

Table (13)

Development of the total distribution networks lengths during the years (2004-2008) in km

Growth in

2008 (%)20082007200620052004DescriptionVoltage

5.2%29592813273326802598Overhead lines 33 KV

Medium

Voltage

Networks

7.6%493458444437415Overhead lines 11 KV

4.4%440421402394220Underground cables 33 KV

4.0%231222202198163Underground cables 11 KV

5.3%41253918378537133401Total Lengths of Medium Voltage Networks

3.6%46164456430741714013400 Volt Overhead linesLow Voltage

Networks 3.3%577559530512426400 Volt Underground cables

3.5%51935015483746834439Total Lengths of Low Voltage Networks

4.3%93188933862283967840Total Lengths of Distribution Networks


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33


Figure (7): Medium and low voltage networks growth during the years (2004-2008)

Continuity of the Electric Supply

The outage rate of the company electric system during 2008 was (14) hours/ consumer against (11) hours/

consumer during 2007. The outages rate includes the outages types (scheduled, unscheduled, third party and

external). The gure below shows the Company outages rates during the years (2004-2008).

Figure (8): Outage rates in the year 2008 compared with the years (2004-2007)


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Peak Load:

The peak load of the Company's electricity system, during August 2008 was (355) MW against (327) MW in

2007, with a growth rate of (8.6%).

Figure (9): Peak Load Growth for 2008 against the Years (2004-2007)

The table shows the Company peak load growth during (2004-2008) and the load forecast for the years

(2009-2013):

Table (14)

Peak Load during the last ve years peak load forecast for the ve coming years

Actual growth

rate (%)

Peak load in

MWYear

13.4%2412004

11.4%2682005

11.7%3002006

9.0%3272007

8.6%3552008

Expected growth

rate (%)

Peak load in

MWYear

6.2%3772009

6.1%4002010

5.5%4212011

5.0%4432012

5.0%4662013


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Meters Testing and Maintenance

The meters testing and maintenance centers, at the Company locations of (Amman, Jordan Valley) accomplished

the following works:

Table (15)

The tested meters in the company locations during the two years (2007, 2008)

20082007Work type

1129612650Testing and clearance of new single phase meters

618100Testing and clearance of old single phase meters

21521400Testing and clearance of new three phase meters direct

connection

101100Testing and clearance of old three phase meters direct

connection

280106Testing and clearance of new three phase meters with current

transformers

44-Testing and clearance of old three phase meters with current

transformers

2443Testing andprogrammingof new three phase meters - with

current and voltage transformers

1005980Testing different types of Consumers services meters

3824Programming of new three phase meters with current

transformers

3430Programming of new three phase meters with current andvoltage transformers

210780Testing various sizes of current transformers

1430Testing various sizes of circuit breakers

The main meters testing laboratory located in Amman / main ofces obtained the ISO 9001 quality certicate

for quality administration systems in the procedures category concerning the purchase, storage, clearance and

release of the electrical energy meters.

The Local Achieved Projects

During the year 2008, the Company executed and delivered several projects including:

1. Installing 33 KV switching station, for (10) panels at the Touristic project Tala Bay in Aqaba Zone for the interest

of Jordan Company for Investment Projects Development.

2. Supplying electric energy to the following hotels projects:

- Holiday Inn Resort at the Dead Sea, Moon Coast Hotel and Zara Hotel project in Aqaba.

3. Supplying electric energy to Calcium Carbonate Production factory in Tafeelah for Al Ahliyah Co. for Mining at

capacity of (5 MVA).


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2. Installing a 33/11 KV, (25*2) MVA substation (A5) and 33 KV (10)km long underground cables , on the

expense of the Electricity Distribution Company for meeting the loads growth and development in Aqaba

city.

3. Supplying the electrical energy to the rst stage for Aqaba Development Company Complex for warehouses

and light industries located at the east of the rear road in Aqaba by installing 33KV (10) panels switching

station.

4. Supplying the electrical energy to Crown Plaza hotel and resort the Dead Sea for the benet of the Social

Security Corporation with a capacity of (10) MVA.

5. Supplying the electrical energy to the Al-Abyad Factory for Fertilizers and Ptrochemicals with a capacity of

(10) MVA, by installing a 33 KV panel and the erection of a 33 KV (25) km long, overhead line.

6. Supplying the electrical energy for the Touristic Village project at the Dead Sea with a capacity of (40)

MVA for the benet of the Jordan Valley Authority by installing 33 KV switching station including (14)

panels and (17) km long underground cables.

7. Supplying the electrical energy to the crystal project in the Dead Sea with a capacity of (40) MVA for the

benet of the Jordan Valley Authority by installing 33 KV switching station including (14) panels and (27)

km long underground cables.

8. Completing the execution of the (37) km long Desert Road Lighting project works within the populated

areas for the benet of Public Works and Housing Ministry for the roads of Al Hassa , Alhussainiyah,

Alhimaimah, Alqatranah and the entrance of Aqaba Zone ( Alu'sailah, Dabbat Hanout, Al Rashidiyah and

Ummul-Bassateen).

9. Supplying the electrical energy to the project of feeds planting at Almuhamadiyah region at Ma'an

governorate on the expense of providing the Jordanian rural areas with an electricity project by installing

33 KV (25) km long medium voltage overhead lines, plus a (1.2) km long medium voltage underground

cable, and the installation of (20) overhead substations with a capacity of (250) KVA each.

10. Supplying the electrical energy to the projects of Aldughailah and Ummulmasayil in the eastern regionon the expense of providing the Jordanian rural areas with electricity project by installing (48) km long

medium voltage overhead plus (14) overhead substations with a capacity of (100) KVA each.

11. Supplying the electrical energy to Water Authority wells sites at Al Qatrana region in Al Karak governorate

by installing (10)km long medium voltage overhead lines and (7) distribution substations with a total

capacity of (1.75) MVA.

Performance Development and Enhancement Projects

1. Carrying out a pilot project at southern Shouneh region (Nahdah Village) using the smart remote meters.

Electronic meters were installed, equipped with units that convey meter reading through low voltage

networks to (5) compiling units installed inside the distribution panels of the feeding voltage transformers

of the village. These readings are sent to a central computer to control and compile the readings. The

project comprises of (315) single phase meter installations, (12) three phase meter of direct linking, and

(13) three phase meter working on current transformers. This project aims at calculate the actual loss rates

in the village and its surroundings, and then decreasing these rates by using the appropriate technical

methods.


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Information Technology & Computers

First: The accomplished projects in systems & applications eld:

1. Supporting and increasing the main and personal computers in the Company to keep up with work

requirements.

2. Providing the Company main sites with the internet services and activating the electronic mail to facilitate

data exchange among the Company various sites.3. Providing the ofces of the consumers' services and administrations with UPS to insure the continuity of

the systems' work in case of the electrical current interruption.

Second: Achievements in the Field of Information Systems and Performance Improvements.

1. Different company sites were completely linked to the main ofces through a modern computer network

by using a Frame Relay.

2. The expansion in business intelligence system application, in some company sites, to assist the Company

employees acquire information in a exible efcient manner.

3. Setting the required specications to attract offers to present consultation services for the consumer services

and a billing information system.

4. Launching the electronic Company gate which enables the employee to acquire a lot of services,

including:

An electric library along with the systems and regulations classied according to their nature.

Enquiring the employee about his personal data entered in the manpower system and the capability of

updating them and various types of leaves.

The employee capability of controlling his various types of loans and advance payments.

Providing the mechanism for the opinion poll. It is known that the employee's personal information is

submitted to the informative security system to securing privacy.

A library for some Company current models and an album for some of the company activities.

Securing a space for the employee, enabling him to build his own site.

Inquiring the employee about his salary card for all years and months.

Electric Materiel Manufacturing

During the year 2008, the Manufacturing Department worked to meet the Company requirements of all the

materials produced therein, where the demand of the materials increased with the increase of the Company

projects. The quantities of production and sales of the cement and steel poles and other products reached a

record number, never reached within the last ve years, in spite of the low numbers of employees. The size of

all products, i.e. the cement poles and metal products increased by (50 %) and more than (100%) for steel poles

compared with the products of the last year. Regarding sales, they increased from JD (1.7) million in 2007 up

to JD (3.3) million during the year 2008 with an increase of about (94 %).

The table below shows the growth production volume within the last ve years.

Table (17)

Volume of main products during the years (2004-2008)

20082007200620052004Main materials

22681552154115981716Concrete poles for medium voltage networks

55402725450332885694Steel poles for low voltage networks

110132125122120Distribution boards of different sizes


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Year

Realize Prots

Equity Dividend ProtProt (loss)

before taxTax

Prot (loss)

after tax

2004 1192436 (159859) 1032577 51413151 750000

2005 154698 (139452) 15246 51408503 0

2006 (1205219) (169925) (1375114) 50016559 0

2007 516186 (213985) 302201 50232576 0

2008 3044036 (1057122) 4101158 54211417 0

Company Establishment Date 12/2/1998

The date of transferring its ownership from the government to the Kingdom

Electricity for Energy Investments Company2/7/2008

Date of the right to start work 1/1/1999

The Company is not listed Not listed

The Realize Prots, Net Equity and the Dividend

Prots / in JD for the Years (2004 2008)


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53


2007

2008 Restated - Note 25

Notes

Other locations

except Aqaba Aqaba Total All locations

OPERATING REVENUES JD JD JD JD

Electric power sales revenue, net 18 7,873,948 10,832,620 18,706,568 11,701,664

Other operating revenues 19 1,291,203 783,508 2,074,711 1,730,263

Total operating revenues 9,165,151 11,616,128 20,781,279 13,431,927

OPERATING EXPENSES

Salaries, wages and related benets 7,035,502 1,804,590 8,840,092 7,770,553

Maintenance and subscribers' services expenses 1,434,363 241,073 1,675,436 1,198,246

Operating and administrative expenses 20 1,845,235 604,572 2,449,807 1,695,540

Depreciation, net 21 2,788,706 782,190 3,570,896 2,389,740

Provision for end-of-service indemnity 947,254 238,172 1,185,426 533,913

Special compensation for ranked employees 1,682 701 2,383 851,718

Allowance for doubtful debts 1,255,250 522,725 1,777,975 147,737

Provision for obsolete inventory and balance

differences550,522 229,255 779,777 -

Amortization of deferred assets 659,374 - 659,374 618,521

Total operating expenses 16,517,888 4,423,278 20,941,166 15,205,968

Gross operating (loss) prot (7,352,737) 7,192,850 (159,887) (1,774,041)

Poles manufacuring revenues, net 22 1,396,352 - 1,396,352 458,315

Amortization of deferred revenues 16 551,810 255,809 807,619 817,531

Debit interests 23 (246,650) (102,711) (349,361) (1,042,000)

Credit interests 24 435,955 116,372 552,327 1,274,648

Currency differences 39,418 16,415 55,833 (96,079)

Other revenues 472,736 268,417 741,153 877,812

Prot (loss) before tax and deduction (4,703,116) 7,747,152 3,044,036 516,186

Income tax surplus (expense) 7 1,402,735 (345,613) 1,057,122 (213,985)

Universities of Jordan fees (30,440) (6,559)

Scientic research support fees (30,440) (6,559)

Technical and vocational education and training

support fund fees(26,438) (2,152)

Board of Directors remuneration (35,000) (16,800)

Prot 3,978,840 270,131

Retained earnings 25 156,419 83,057

Proposed dividends to be distributed as

following:4,135,259 353,188

Statutory reserve 304,404 65,589

Voluntary reserve - 131,180

Retained earnings 3,830,855 156,419

Total 4,135,259 353,188

Weighted average number of shares during

the year10,000,000 10,000,000

Earnings per share 0.398 JD 0.027 JD

INCOME STATEMENT FOR THE YEAR ENDED CECEMBER 31 , 2008


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1. LEGAL STATUS AND ACTIVITY

- Electricity Distribution Company was registered with Ministry of Industry and Trade on February 12, 1998

as a public shareholding company under number (335) and in implementation of the Council of Ministersresolution dated October 4, 1997, regarding establishment of a separate company from the National

Electricity Company, to undertake the distribution of electric power, and to be 75% owned by government

and 25% by National Electricity Company until privatization, in which all of distributing activities assets

will construe to National Electricity Company.

- The Company commenced its industrial and commercial activities at January 1, 1999.

- The Company was registered at Aqaba Special Economic Zone Authority under registration No. (1101103002)

on October 30, 2001 in accordance with the provisions, regulations, and instructions of Aqaba Special

Economic Zone Law No. (32) for the year 2000.

- As of July 2, 2008, all Companys shares that were registered in the name of the government of the Hashemite

Kingdom of Jordan were transferred to the Kingdom Electricity Company for Power Investments (Limited

Private Shareholding Company).

- The nancial statements have been approved by the board of directors in their session dated March 26,

2009.

2. SIGNIFICANT ACCOUNTING POLICIES

The nancial statements are prepared in accordance with the International Financial Reporting Standards and

the related interpretations originated by the International Financial Reporting Interpretations Committee. The

following is a summary of the signicant accounting policies applied:

a) Fixed assets

- Fixed assets are recorded at cost less the accumulated depreciation and any accumulated impairment

losses. Lands are not depreciated.

- The Company uses the straight-line method in depreciating its xed assets over their estimated

useful lives at the following annual rates:

Up to June 30, 2008 From July 1, 2008

Buildings and constructions 2% - 20% 2%

Underground cables 4% 3%

Transformers stations and network lines 4% 5% - 7%

Subscribers' meters 2% - 2.56% 7%

Telecommunication equipment 7.14% - 20% 12%

Computers 20% 20%

Vehicles 10% - 25% 15%

Laboratory equipment 7.7% - 25% 9% - 20%

Operating equipment 10% - 25% 9% - 20%

Tools 11.11% - 25% 20%

Other equipment 10% - 25% 9% - 20%

Furniture and ofce equipment 10% - 25% 9% - 20%

NOTES TO THE FINANCIAL STATEMENTS


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57


- An asset is impaired when its carrying amount exceeds its recoverable amount. If indication of such

impairment exists, the asset is written down to its recoverable amount.

- The gain or loss arising from the disposal of an item of xed assets shall be determined as the

difference between the net disposal proceeds, if any, and the carrying amount of the item. This gain

or loss is included in the income statement.

- The costs of day- to- day repair and maintenance for xed assets are recognized in the income

statement as incurred.

b) Subscribers contributions and rural ls

Subscribers contributions and rural ls are recorded as governmental dues to related parties, and

are presented in the statement of nancial position in both of assets and liabilities side by the same

amount under the category of subscribers contributions and rural ls, and are amortized using

straight-line method at an annual rate of 4% of the contributions balance at end of the year.

c) Projects under construction

- Amounts paid to construct xed asset item are charged rst to projects in progress account. When

project becomes ready to use, it is transferred to the related xed assets caption.

- Borrowing costs that are directly attributable to the construction of a qualifying xed asset are

capitalized as part of the cost of that asset during the period necessary to complete and prepare the

qualifying asset for its intended use, and also a part of technical salaries and wages is charged to the

xed assets caption at a percentage determined by the accountable persons of the company.

d) Deferred assets

Electricity Regulatory Commission board of directors in his capacity as a delegate for the

Commission counsel decided in its meeting held on October 18, 2003 to consider the compensation

paid by electric companies to real estate owners, in which electricity networks pass through theirplots of land, as a capitalized assets starting from January 1, 2003. These amounts are amortized

over a period of 10 years.

e) Investment in available for sale securities

Investments in available for sale securities that do not have a quoted price in an active market, and

whose fair value cannot be reliably measured shall be measured at cost.

f) Inventories

- Inventories are measured at the lower of cost and net realizable value.

- Net realizable value is the estimated selling\usage price in the ordinary course of business less theestimated costs of completion and the estimated costs necessary to make the sale\usage.

- The cost of inventories comprises all costs of purchase, costs of conversion and other costs incurred

in bringing the inventories to their present location and condition.

- The costs of inventories are assigned using the weighted average formula.

g) Trade receivables

- Trade receivables are stated at invoice amount less any provision for doubtful debts.

- A provision for doubtful debts is taken when there is an indication that the receivables may not be

collected.


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3-Fixedassets

Thisitemconsistsofthefollowing:

Cost

AccumulatedDepreciation

NetBookValue

Asat

Asat

Asat

Asat

Jan

uary

December

January

December

December

December

Description

1,2008

Additions

Disposals

31,2008

1,2008

Additions

Disposals

31,2008

31,2008

31,2007

J

D

JD

JD

JD

JD

JD

JD

JD

JD

JD

Lands-Note3/b

2,673,9

68

187,7

34

-

2,8

61,7

02

-

-

-

-

2,8

61,7

02

2,6

73,9

68

Buildingsandconstructions

6,955,6

72

923,7

50

-

7,8

79,4

22

1,4

38,1

39

162,10

5

-

1,6

00,2

44

6,2

79,1

78

5,5

17,5

33

Undergroundcables

25,387,9

95

1,6

38,5

03

-

27,0

26,4

98

4,4

96,0

40

923,98

3

-

5,4

20,0

23

21,606,4

75

20,8

91,9

55

Transformersstationsand

networklines

102,193,1

69

8,7

32,0

66

-

110,9

25,2

35

25,7

00,6

85

5,2

52,52

5

-

30,9

53,2

10

79,972,0

25

76,4

92,4

84

Subscribers'meters

12,432,4

49

266,5

46

-

12,6

98,9

95

3,2

90,4

43

596,1

59

-

3,8

86,6

02

8,8

12,3

93

9,1

42,0

06

Telecommunication

equipment

191,1

38

26,4

62

135

217,4

65

145,8

35

25,01

4

51

170,7

98

46,6

67

45,3

03

Computers

919,0

40

100,6

07

-

1,0

19,6

47

579,9

67

136,40

8

-

716,3

75

303,2

72

339,0

73

Vehicles

1,943,7

39

231,3

34

-

2,1

75,0

73

1,6

44,7

58

136,7

99

-

1,7

81,5

57

393,5

16

298,9

81

Laboratoryequipment

3,1

00

-

-

3,1

00

3,0

97

-

-

3,0

97

3

3

Operatingequipment

891,2

61

40,6

00

-

931,8

61

167,3

55

89,5

99

-

256,9

54

674,9

07

723,9

06

Tools

1,011,5

05

90,9

62

-

1,1

02,4

67

741,8

90

98,8

31

-

840,7

21

261,7

46

269,6

15

Otherequipment

342,7

08

32,2

28

-

374,9

36

240,2

75

39,3

55

-

279,6

30

95,3

06

102,4

33

Furnitureandofce

equipment

718,0

14

41,9

92

-

760,0

06

511,0

13

40,70

1

-

551,7

14

208,2

92

207,0

01

155,663,758

12,312,784

135

167,976,407

38,959,497

7,501,47

9

51

46,460,925

121,515,482

116,704,261

Deduct:

Oldrurallsassets

278,8

88

-

-

278,8

88

126,4

30

11,15

6

-

137,5

86

141,3

02

152,4

58

Subscribers'contributions

andnew

rurallsassets

88,070,7

98

6,2

04,3

31

-

94,2

75,1

29

23,1

65,2

65

3,9

19,4

27

-

27,0

84,6

92

67,190,4

37

64,9

05,5

33

Fixedassets

67,314,072

6,108,453

135

73,422,390

15,667,802

3,570,89

6

51

19,238,647

54,183,743

51,646,270


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4. DEFERRED ASSETS

Movement of this item is as follows during the year:

5. LONG TERM LOAN RECEIVABLE

This item represents the balance of the loan granted to the Companys Employees Housing Fund. The loan

granted without interest and denite repayment schedule.

The Fund is 100% owned by the company; accordingly, all of its returns will belong to the company in case

of liquidation.

6. INVESTMENTS IN SECURITES AVAILABLE FOR SALE

This item represents 12.3% ownership in Electrical Equipment Industries Company Limited Liability

Company.

7. INCOME TAX

a) This item consists of the following:

2008 2007

Locations

other thanAqaba

Aqaba Total

All

locations

JD JD JD JD

Balance - beginning of the year (52,011) 196,262 144,251 130,746

Provided during the year - 391,102 391,102 213,985

Paid during the year (7,975) (192,763) (200,738) (200,480)

Balance - end of the year (59,986) 394,601 334,615 144,251

2008 2007

JD JDJuridical compensations at beginning of the year 6,185,210 5,270,277

Additions during the year 408,534 914,933

Juridical compensations at end of the year 6,593,744 6,185,210

Accumulated compensations amortization at beginning of

the year 1,779,567 1,161,046

Amortization during the year 659,374 618,521

Accumulated compensations amortization at end of the year 2,438,941 1,779,567

End of the year balance 4,154,803 4,405,643


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63


9. OTHER DEBIT BALANCES

This item consists of the following:

10. ACCOUNTS AND SUBSCRIBERS RECEIVABLE


b) Water Authority and other subscribers receivable include interest on unpaid energy sales amounting to

JD 2,494,465 as of December 31, 2008 (JD 2,106,026 as of December 31, 2007).

c) Movement of this item is as follows during the year:

2008 2007

JD JD

Prepaid expenses 88,701 74,583

Refundable deposits 18,419 17,043

Total 107,120 91,626

2008 2007

JD JD

Other subscribers receivable - Note 10/b 32,615,253 26,839,871

Water Authority receivable - Note 10/b 6,211,148 5,978,225

Jordanian Rural Electricity project 4,054,781 2,194,906

Other debit balances 1,249,571 2,073,494

Checks under collections 777,671 1,356,144

Water Authority - Job orders - 278,659

Deduct : Allowance for doubtful accounts - Note 10/c (2,566,880) (788,905)

Net 42,341,544 37,932,394

2008 2007

JD JD

Balance - beginning of the year 788,905 641,168

Additions during the year 1,777,975 147,737

Balance - end of the year 2,566,880 788,905


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17. ACCOUNTS PAYABLE AND OTHER CREDIT BALANCES


b) Included in National Electric Power Company - energy purchases, an interest of payment delays of

purchased power amounting to JD 2,727,466 as of December 31, 2008 (JD 2,385,313 as of December 31,

2007). Transactions with National Electric Power Company are trading in nature. The transactions which

presented in the income statement are amounted to JD 84,956,607 that represent the purchased energy

for the year ended December 31, 2008 (JD 69,488,640 for the year ended December 31, 2007).

c) The National Electricity Power Company payables (before year 1999) will be settling with the Company.

18.ELECTRIC POWER SALES REVENUE, NET


2008 2007

JD JD

National Electric Power Company- energy purchases

- Note 17/b 13,827,135 19,366,250

New rural ls project 3,569,966 3,315,108

Governmental and other payables 2,993,925 2,665,323

Other credit balances 1,707,331 913,333

National Electric Power Company-energy payables before

year 1999 - Note 17/ c 504,436 504,436

Energy prices received in advance 125,421 114,297

National Electric Power Company - Others 123,342 123,342

Notes payable 111,467 545,970

Contractors' retentions 77,609 51,935

Accrued expenses and interests 63,958 14,881

Provisions for scientic research and professional training

support fees 37,007 6,567

Board of directors remuneration 35,000 16,800

Provision of universities of Jordan fees 30,440 6,559

Provisions for technical and vocational education and

training support fund 25,126 2,152

Total 23,232,163 27,646,953

2008 2007

Locations

other

than Aqaba

Aqaba Total All locations

JD JD JD JD

sold energy 70,220,229 33,442,946 103,663,175 81,190,304

purchases energy 62,346,281- (22,610,326) (84,956,607) (69,488,640)

NET 7,873,948 10,832,620 18,706,568 11,701,664


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20. OPERATING AND ADMINISTRATIVE EXPENSES

This item consists of the following:

2008 2007

Locations

other

than Aqaba

Aqaba Total All locations

JD JD JD JD

Vehicles expenses 522,193 105,288 627,481 361,120

Telephones and courier 156,025 54,040 210,065 115,633

Electricity and water 130,823 64,282 195,105 151,509

License fees - Electricity Regulatory

Commission109,957 45,789 155,746 128,908

Transportations and per diem 103,044 41,896 144,940 138,150

University fees and stamps 82,409 34,155 116,564 114,088

Guarding 97,632 16,532 114,164 90,073

Stationery and printing 61,405 22,274 83,679 67,320

Board of directors and committees

remunerations57,106 23,781 80,887 70,589

Professional and consultation fees 55,513 23,117 78,630 68,404

Labor juridical compensation 55,151 22,966 78,117 1,703

Hospitality and cleanliness 49,733 14,575 64,308 56,359

Government fees 43,507 18,776 62,283 27,587

Computer maintenance 41,916 17,455 59,371 36,649

Employees benets 43,602 15,009 58,611 18,450

Insurance 39,437 16,423 55,860 48,442

Subscriptions and activities 39,786 15,037 54,823 39,738

Training 34,411 14,330

Documents

Annual Report - 2008Eng