The Board of Directors of FANCO S.A. met on the 23rd March 2001 by reason of the decision of the 22nd March 2001 of the Board of the Athens Stock Market to set the company share under surveillance, and unanimously decided the following: Ψ To invite for an urgent General Assembly of the shareholders on the 19th of April 2001 to only address the issue of: ? Acquisition of own shares up to 10%, according to article 16 paragraph 5 of Law 2190/1920?. Ψ To take all necessary legal means to prove that this decision is unfounded at both legal and financial level. Ψ As for the essence of the decision of the Board of Directors of the Athens Stock Market, our company points to the following:§Simultaneously to the publication of FANCO's accounts, the 28/2/01, FANCO has issued a press release, which has fully justified the financial results of the company for the year 2000 and indicated its perspectives. §As then reported in the press release and as accordingly discussed during the Annual General Meeting of the Shareholders of the company in 2000, (the minutes of which had then been presented to the Athens Stock Market), the company had commenced the huge task of its full reorganisation. The cost of reorganisation and the large appreciation of the prices of basic materials, petrol and the dollar, resulted in the decrease of the company's profitability of approximately 700.000.000 Drs. during the fiscal year of 2000. §Our company has been and continues to be the only large representative of our country in the global market in the field of sportswear, and employs 1.800 people in all companies of the Fanco Group. FANCO S.A. is fully vertically integrated, from spinning mills through to ready-made clothing, with the latest mechanical equipment and a network of 4 subsidiary companies in the Balkans, where all labour intensive production has been transferred. §Fanco S.A. is one of the largest manufacturers in the International market and constitutes an attractive and reliable choice for the most well-known brands worldwide, due to its innovative business setup, the low cost of its production, the modern management, and the high quality of services provided to them. §The company's turnover during the last two-year period is consistently over 11 billion drs., which all are exports. §The Capital structure of the company proves to any analyst its financial vigour. §Whilst continuing its current developmental plan, FANCO S.A. is establishing a R&D company through which a different dimension will be given to its growth and will additionally provide new services to other companies. §Our company has proceeded in an enviable form of organisation equal to that of very big multinationals. § FANCO S.A. is a pioneer and ambassador of our country in the Balkans.Hence, it is surprising how the Board of the Athens Stock Market made this decision for the share's surveillance taking into account only one single factor: the brave and right decision to fully clear the company's stock, by accounting it in the balance sheet of the year 2000 at current supplying prices, creating by way of reserves a loss of 2.4 billion drs. This practice is very common in foreign countries and large companies which have undertaken such decisions have been praised by the Stock Market and investors in their countries.The Athens Stock Market should seriously consider that this loss does not lead the company to an increase of its banking loans and therefore to a decrease in its profitability, but on the contrary, leads in an increase of profitability in the following fiscal years, due to decrease of loans (from the sale of the stock) and decrease of maintenance costs for stock. The decision of the Athens Stock Market did not consider that the total results of the company's operation are positive and the strength of all the other related financial indices which constitute the basic principles of economic analysis.With this decision for surveillance of the share, there are serious problems created within our company, as it encourages a climate of uncertainty in our clients and particularly in a period that we aim at strengthening our overall collaboration with them. We believe that the Board of the Athens Stock Market did not take into account any of the above mentioned factors; as it should have done, when evaluating the company and neither requested from our company any further clarifications concerning its financial results.Consequently, we consider the decision unfair, without any legal base and already causing problems to the company but also problems to the company's share which already since Friday 23/3/01 after the announcement of the decision has suffered great losses. The company will take any appropriate and legal mean so as to ensure its interests; as well as the interests of its shareholders and its 1.800 employees.


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