Financial and operatingresults Q3 2018 · Neptun II (stage II) 11 094 209 Q1 2019* Polnord Warszawa Ząbki Neptun 22 92 95 Wilania 8 207 120 Q2 2020* Polnord Gdynia Brama Sopocka

Financial and operatingresults

Q3 2018

29 November 2018

Executive summary

Operating data

Financial data

Attachments

2

AGENDA

EXECUTIVESUMMARY

3

4

Executive summary

✓ PLN 185.1 million sales revenue for the three quarters of 2018, up by +25.2% as compared to PLN 147.9 million in the corresponding period of 2017, as a result of settling historical sales

✓ PLN +56.9 million net cash flows from operating activities for the first three quarters of 2018

✓ PLN -37.7 million net result for Q1-3 2018, as the result of KB Dom, increase in costs and additional adjustments of the financial result

✓ Sale of office buildings at Wilanów Office Park - finalizing the transaction will reduce the debt and release funds to finance further investments

✓ Strategic options review process - possible cooperation with potential investors

5

Selected financial results vs. market consensus

Specification(PLN mn)

Q1-3 2017 Q1-3 2018 One-offsQ1-3 2018 normalised

Market consensus PAP [PLN mn]

Change Q1-3 2018 normalised /

consenus

Sales revenue 147.9 185.1 - 185.1 198.9 -13.8

Profit from sales before tax 32.3 24.1 -2.1 26.2 - -

EBIT 1.4 -11.5 -5.8 -5.7 -2.4 -3.3

EBITDA 2.4 -10.5 -5.8 -4.7 -1.6 -3.1

Net result -1.8 -37.7 -18.8 -18.9 -8.3 -10.6

CF from operations 39.5 56.9 - 56.9 - -

Specification(PLN mn)

Q3 2017 Q3 2018 One-offsQ3 2018

normalisedMarket consensus

PAP [PLN mn]

Change Q3 2018 normalised /

consenus

Sales revenue 50.5 42.1 - 42.1 38.6 3.5

Profit from sales before tax 11.8 8.4 -1.9 10.3 - -

EBIT -3.2 -1.9 -3.4 1.5 -2.6 4.1

EBITDA -2.8 -1.6 -3.4 1.8 -2.3 4.1

Net result 3.6 -12.9 -5.9 -7.0 -4.2 -2.8

CF from operations 15.9 14.5 - 14.5 - -

6

-37.7

-18.9

-10.2

-1.9

-3.2

-1.0

-2.1

4.3

7.5

1.93.2 6.5

1.1 2.7

10.0

Reported netresult

KOWR -establishingprovisions

KOWR -releasing

provisions

KB Dom -writing-offreceivables

KB Dom -contractual

penalties

KB Dom -repair

provision

KB Dom -write-offsrelated to

change in GCFadesa -dyvidend

StacjaKazimierz -

consolidationerror

StrojDom -write-off

Ząbki - reportadjustment

Sidelco -writing-offreceivables DTA write-off IRRS 9

Adjusted netresult

Reported net result vs. adjusted net result

One-off positive effectOne-off negative effect

Net result adjustment Q1-3 2018 (PLN mn)

7

Selected operating data

Closing offer 1)Units sold 1) Units introduced to

sales 1)

Units recognised in

net result 1)

Units recognised in revenue

Q3 2018 256 140 141 2) 239 890

Q3 2017 384 128 201 391 1 395

Change -33% +9% -30% -39% -36%

Q1-3 2018 753 629 658 2) 239 888

Q1-3 2017 1 034 394 557 1 288 1 395

Change -27% +60% +18% -81% -36%

1) Data weighted with Polnord's share2) Data for Q3 2018 does not include Semeko Aqusfera Sp. z o.o.

OPERATING DATA

8

9

The situation on the Polish housing market in Q3 2018

✓ 14.2 thou. of units sold on 6 main markets (Warsaw, Wrocław, Cracow, Tri-City, Poznań, Łódź) – drop by 8.9% q/q

✓ 14.2 thousand premises sold on 6 main markets (Warsaw, Wrocław, Cracow, Tri-City, Poznań, Łódź) - a decrease by 8.9% q/q

✓ Almost 16% y/y decrease in the number of units available on the Warsaw market

✓ 7% increase y/y in the number of units available on the Tri-City market

✓ The highest increase in prices y/y: Warsaw +14.2%, Wrocław +13.6%, Łódź +9.3%, Tri-City +7%

✓ Environment: increase in prices of general contracting and prices of building materials, regulatory changes, necessity to remodel the method of financing development investments

Based on REAS data

277 269 236 242336 314

384 355299

198256

Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q1 2017 Q3 2017 Q4 2017 Q1 2018 Q2 2018 Q3 2018

10

Units sold – per quarter and cumulatively

Sale of premises weighted with Polnord’s share (pcs)

1 054 1 024

1 389

1 034

753

2015 2016 2017 Q1-3 2017 Q1-3 2018

-33.8% 29.3%

49

74

133

51.0% 79.7%-27.2%

July August September

419378

53 9223

70

241308

64 45 58 37

Warsaw Tri-City Olsztyn Szczecin Łódź Wrocław

Q1-3 2017 Q1-3 2018

11

Units sold – geographically

109

182

28 337

26

10377

309

26 11

Warsaw Tri-City Olsztyn Szczecin Łódź Wrocław

Q3 2017 Q3 2018

Sale of premises weighted with Polnord shares : 753 in Q1-3 2018 vs 1,034 units in Q1-3 2017 (pcs)

Sale of premises weighted with Polnord shares : 256 in Q3 2018 vs 384 units in Q3 2017 (pcs)

12

2)1)

Units sold – Polnord against the wide market

Sale of premises weighted with Polnord’s share (pcs)

-33.2% -17.4%28.6% -2.4%

5 largest developers reported

changes in saless

• in Q2 vs. Q1 2018 from -52.1% to -5.4%

• in Q3 vs. Q2 2018from -16.9% to 40.5%

298 18 400

199

15 600 256

14 200

1Q 2018 2Q 2018 3Q 2018

1) Data weighted with Polnord's share2) Developers listed on WSE or Catalyst

Polnord Listed developers

Q1 2018 Q2 2018 Q3 2018

13

Units recognised in financial result – by quarter and cumulatively

Deeds weigthed with Polnord’s share (pcs)

301163 200 178 109

247 201

574

323194 141

Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018 Q2 2018 Q3 2018

990

843

1 131

557658

2015 2016 2017 Q1-3 2017 Q1-3 2018

-39.9% -27.3%

18.1%

1) Data for Q3 2018 does not include Semeko Aqusfera Sp. z o.o.

1)

1)

325

116

435 19

50

302269

33 29 25

Warsaw Tri-City Łódź Olsztyn Szczecin Wrocław

Q1-3 2017 Q1-3 2018

14

Units recognised in financial result – geographically

111

2943

118

41

93

5 1 1

Warsaw Tri-City Łódź Olsztyn Szczecin Wrocław

Q3 2017 Q3 2018

Deeds weigthed with Polnord’s share: 658 in Q1-3 2018 vs 557 units in Q1-3 2017 (pcs)

Deeds weigthed with Polnord’s share: 141 in Q3 2018 vs 201 units in Q3 2017 (pcs)

15

1 055 981 1 004908 830

1 187 1 256 1 261

1 015844 859

199191 141

189

131

200 139 140

88

60 29

0

200

400

600

800

1 000

1 200

1 400

31.03.2016 30.06.2016 30.09.2016 31.12.2016 31.03.2017 30.06.2017 30.09.2017 31.12.2017 31.03.2018 30.06.2018 30.09.2018

Polnord 100% JV

The number of premises on offer broken down by 100% Polnord and JV (pcs)

1 145 1 097 1 1031 1721 254 1 395 1 4011 387961 904

Offer

1)

1) Data weighted with Polnord’s share

888

100% Polnord

FINANCIAL DATA

16

17

Selected financial data

PLN thou. Q3 2017 Q3 2018 Q1-3 2017 Q1-3 2018

Sales revenue 50 509 42 082 147 913 185 143

Profit on sales before tax 11 818 8 399 32 286 24 054

EBIT -3 202 -1 910 1 357 -11 514

EBIT margin -6.3% -4.5% 0.9% -6.2%

EBITDA -2 789 -1 616 2 310 -10 469

EBITDA margin -5.5% -3.8% 1.6% -5.7%

Net profit (loss) 3 649 -12 891 -1 793 -37 719

Net profit (loss) margin 7.2% -31.1% -1.2% -20.4%

Cash flows

Cash flows from operating activity 15 873 14 503 39 492 56 925

Cash flows from investment activity 4 501 -679 -2 320 -825

Cash flows from financial activity 799 -29 653 -56 961 -94 104

Cash and cash equivalents 21 173 -15 341 123 731 78 728

Balance sheet data

Investment real property 382 682 251 701 382 682 251 701

Stock 570 688 521 574 570 688 521 574

Total assets 1 468 488 1 344 450 1 468 488 1 344 450

Equity 708 083 640 989 708 083 640 989

Debt 455 240 335 260 455 240 335 260

Net debt 331 509 253 528 331 509 253 528

18

Corporate cash flows (PLN mn)

62.6

14.2

55.0

39.5

56.9

19.3

47.2

15.3

-2.3 -0.8

-108.6

21.8

-94.1

-57.0

-94.1

2015 2016 2017 Q1-3 2017 Q1-3 2018

Cash flows from operating activity Cash flows from investment activity Cash flows from financial activity

Cash flows

275.4 332.7 287.4 256.8

161.5154.2

131.879.5

0.20.3

0,3

-100

100

300

500

700

900

31.12.2015 31.12.2016 31.12.2017 30.09.2018

Bonds Loans Financial lease

136.8

43.276.8

41.5

.6.9

31

0

50

100

150

200

Q4 2018 2019 2020 2021

Bonds Loans

436.4343.6 299.8 254.9

60.4%48.7%

42.3% 39.8%

-10,0%

10,0%

30,0%

50,0%

70,0%

-

100

200

300

400

2015 2016 2017 09.2018

Net debt Net debt ratio

Debt ratios 2015 – 09.2018 (PLN mn)Loan repayment schedule and redemption of bonds as at 30.09.2018 (PLN mn)

19

Financial debt

436.9 487.1 419.5 336.6

The structure of the Group's financial debt in the period 2015 – 30.09.2018 based on nominal value of debt (PLN mn)

1)

1) Net debt = interest-bearing financial debt - cash and cash equivalents; net debt ratio = net debt / equity

ATTACHMENTS

20

ProjectGeneral information

Units sold (net– after annulations) Offer as at

01.10.2018PUM (m²) No of units Delivery date Implementing company to 31.12.2017 Q1-3 2018

Part I - projects implemented by Polnord SA’s 100% subsidiaries

WARSAW

Delivered projects

Neptun I (stage II) 5 623 105 Q4 2015 Polnord Warszawa Ząbki Neptun 104 - 1

Neptun II (stage Ia) 7 500 150 Q3 2017 Polnord Warszawa Ząbki Neptun 141 6 3

Neptun II (stage Ib) 3 467 65 Q4 2017 Polnord Warszawa Ząbki Neptun 63 2 -

Śródmieście Wilanów (building E) 8 773 151 Q1 2017 Śródmieście Wilanów 150 - 1

Brzozowy Zakątek (building A2) 7 523 129 Q4 2017 Śródmieście Wilanów 128 - 1

Brzozowy Zakątek (building A3) 5 654 99 Q1 2018 Śródmieście Wilanów 98 - 1

Brzozowy Zakątek (building A4) 6 803 107 Q3 2018 Śródmieście Wilanów 72 34 1

Project under implementation

Neptun II (stage II) 11 094 209 Q1 2019* Polnord Warszawa Ząbki Neptun 22 92 95

Wilania 8 207 120 Q2 2020* Polnord Gdynia Brama Sopocka - 38 82

21

Att. 1 Sales offer

*scheduled date of project delivery



01.10.2018PUM (m²) No of units Date of delivery Implementing company to 31.12.2017 Q1-3 2018


TRI-CITY

Delivered projects

Ostoja Myśliwska I-II 13 456 242 2011-2012 Polnord Apartamenty 239 - 3

Brama Sopocka II-III 15 680 334 Q3 2015 Polnord Gdańsk Dwa Tarasy 334 -1 1

Dwa Tarasy I-II 3 396 42 Q2 2017 Polnord Gdynia Brama Sopocka 18 20 4

Chabrowe Wzgórze I 6 507 152 Q3 2017 Polnord Apartamenty 151 1 -

Chabrowe Wzgórze II 6 014 139 Q1 2018 Polnord Apartamenty 70 66 3

Projects under implementation

Fotoplastykon I 7 833 157 Q1 2019* Polnord Apartamenty 110 43 4

Fotoplastykon II 8 128 161 Q3 2020* Polnord Apartamenty 20 40 101

Fotoplastykon III 3 325 66 Q3 2020* Polnord Apartamenty - 24 42

Studio Morena 19 965 382 Q1 2020* Polnord Apartamenty 137 110 135

22

Att. 2 Sales offer






OLSZTYN

Delivered projects

Osiedle Tęczowy Las II (building 8) 5 251 87 Q3 2018 Polnord Olsztyn Tęczowy Las 70 11 6


Osiedle Tęczowy Las II (building 7) 6 039 96 Q2 2019* Polnord Olsztyn Tęczowy Las 21 47 28

Osiedle Tęczowy Las III (building 9-12) 7 260 119 Q3 2019* Polnord Olsztyn Tęczowy Las - 6 113

SZCZECIN

Delivered projects

Ku Słońcu I 12 284 222 Q4 2011 Polnord Szczecin Ku Słońcu 221 - 1

Ku Słońcu III (building 3) 9 191 182 Q2 2017 Polnord Szczecin Ku Słońcu 165 11 6

Ku Słońcu III (building 5) 7 341 154 Q3 2018 Polnord Szczecin Ku Słońcu 113 34 7

23


Att. 3 Sales offer

24






ŁÓDŹ

Delivered projects

City Park II 5 832 87 Q1 2011 Polnord Łódź City Park 85 - 2

City Park IV (bud. A5) 3 868 94 Q4 2015 Polnord Łódź City Park 93 1 -

City Park IV (bud. A3) 7 401 115 Q2 2017 Polnord Łódź City Park 86 28 1


Senatorska bud A 12 129 246 Q2 2020* Polnord Sopot II - 29 217

Total – delivered projects 141 562 2 656 2 401 213 42

Total – projects under implementation 83 980 1 556 310 429 817

Including projects commenced in 2018 15 467 239 - 44 195

Total Part I 225 542 4 212 2 711 642 859

Att. 4 Sales offer




Part II - projects implemented by companies co-controlled by Polnord SA. Data weighted with the share of Polnord SA

WARSAW

Delivered projects

Ostoja Wilanów V-VII 27 161 385 2009-2013 Fadesa Polnord 383 1 1

Ostoja Wilanów VIa (C2) 6 140 62 Q4 2016 Fadesa Polnord 62 0 -

Ostoja Wilanów VIII (B2) 2 435 23 Q3 2017 Fadesa Polnord 21 0 2

Stacja Kazimierz I 4 707 92 Q1 2016 Stacja Kazimierz 92 0 1

Stacja Kazimierz II 3 443 58 Q2 2017 Stacja Kazimierz II 57 - 1

Stacja Kazimierz III (building 4AB) 5 275 88 Q3 2018 Stacja Kazimierz III 66 17 5

Stacja Kazimierz IV (building 3) 2 241 40 Q3 2018 Stacja Kazimierz IV 29 11 1


Stacja Kazimierz V (building 5) 3 066 50 Q2 2020* Stacja Kazimierz V 7 40 3

TRI-CITY

Projekty oddane do użytkowania

Aquasfera (bulding T2) 5 552 107 Q2 2015 Semeko Aquasfera 106 1 -

Aquasfera (building T3 staircase A and B) 2 133 44 Q3 2017 Semeko Aquasfera 41 1 2

Aquasfera (building T3 staircase C and D) 2 319 43 Q4 2017 Semeko Aquasfera 35 4 5

25


Att. 5 Sales offer

26





WROCŁAW

Delivered projects

Apartamenty Innova A 3 583 74 Q4 2016 Osiedle Innova 73 1

Apartamenty Innova B 4 086 59 Q4 2017 Osiedle Innova 48 8 3

Projekty w realizacji

Apartamenty Innova C 3 738 63 Q4 2018* Osiedle Innova 40 18 5

Apartamenty Innova D 2 417 41 Q1 2019* Osiedle Innova 29 11 1


Total - Projects under implementation 9 221 154 76 68 10

w tym projekty rozpoczęte w 2018 r. - - - - -

Total Part II 78 296 1 226 1 086 111 29

Summary Part I and Part II


Total - Projects under implementation 93 201 1 710 386 497 827

Including projects commenced in 2018 15 467 239 - 44 195

Total Part I and II 303 838 5 438 3 797 753 888

*scheduled date of project deliveryData weighted with Polnord SA’s share

Att. 6 Sales offer

27

Att. 7 Revenue and profit before tax by city

Q1-3 2018

Units delivered to clients Revenue Profit on sales before tax

Project No of units Area of units [PLN thou.] Share % [PLN thou.]Gross profitability on

sales


Warsaw 300 16 263 98 730 56% 8 287 8%

Tri-City 267 13 216 57 208 33% 6 891 12%

Olsztyn - - - - - -

Szczecin 29 1 510 7 851 4% -576 -7%

Łódź 33 2 596 11 365 6% -113 -1%

Total Part I 629 33 584 175 153 100% 14 488 8%


Warsaw 2 271 2 029 15% 356 18%

Wrocław 25 1 884 11 341 81% 2 791 25%

Tri-City 2 134 576 4% - -

Total Part II 29 2 288 13 946 100% 3 146 23%

Summary Part I and Part II

Total Part I and II 658 35 872 189 099 100% 17 634 9%

28

Att. 8 Revenue and profit before tax by projects

Q1-3 2018

ProjektUnits delivered to clients Revenue Profit on sales before tax

No of units Area of units [PLN thou.] Share % [PLN thou.] Gross profitability on salesPart I - projects implemented by Polnord SA’s 100% subsidiaries WarsawŚródmieście Wilanów (building A) - - - - - -

Śródmieście Wilanów (building C) - - - - - -

Śródmieście Wilanów (building D) - - - - - -

Śródmieście Wilanów (building E 2 118 810 - 380 47%

Śródmieście Wilanów (building F) 2 96 885 1% 112 13%

Brzozowy Zakątek A1 3 213 1 512 1% -1 -

Brzozowy Zakątek A2 71 4 379 29 267 17% 3 288 11%

Brzozowy Zakątek A3 82 4 675 31 731 18% 3 483 11%

Apart Hotel 10 258 2 019 1% 1 -

Neptun I (stage I) - - - - - -

Neptun I (stage II) - - 51 - -17 -33%

Neptun II (stage Ia) 66 3 159 16 081 9% 705 4%

Neptun II (stage Ib) 64 3 365 16 374 9% 337 2%

Tri-CityOstoja Myśliwska I-II - - 6 - 6 100%

2 Potoki I - - - - - -

2 Potoki II 1 42 191 - 68 35%

2 Potoki III 1 60 218 - 6 3%

2 Potoki IV 1 48 181 - 9 5%

Chabrowe Wzgórze I A1 34 1 712 6 298 4% 864 14%

Chabrowe Wzgórze I A2 37 1 877 7 157 4% 1 227 17%

Chabrowe Wzgórze I C1 53 2 305 9 039 5% 808 9%

Chabrowe Wzgórze II B 64 2 940 12 490 7% 3 158 25%

Chabrowe Wzgórze II C2 54 2 601 10 924 6% 2 130 20%

Dwa Tarasy I-II 1 40 244 - 23 10%

Brama Sopocka I - - 6 - -1 -17%

Brama Sopocka II-III 21 1 590 10 454 6% -1 406 -13%

29


Q1-3 2018

Project Units delivered to clients Revenue Profit on sales before tax

No of units Area of units [PLN thou.] Share % [PLN thou.] Gross profitability on salesPart I - projects implemented by Polnord SA’s 100% subsidiaries OlsztynOsiedle Tęczowy Las (building 4) - - - - - -Osiedle Tęczowy Las (building 5) - - - - - -Osiedle Tęczowy Las (building 6) - - - - - -SzczecinKu Słońcu I - - - - - -Ku Słońcu II (building 2) - - - - - -Ku Słońcu II (building 1) - - - - - -Ku Słońcu III (building 3) 29 1 510 7 817 4% -576 -7%ŁódźCity Park II - - 5 - -2 -40%City Park IV (building A5) - - 117 - -111 -95%City Park IV (building A3) 33 2 596 11 243 6% - -Total Part I 629 33 584 175 153 100% 14 488 8%

30

Q1-3 2018

Project

Units delivered to customers Revenue Profit on sales before tax

Number of units Area of uits [PLN ‘000] % share [PLN ‘000]Profitability of sales

before tax

Part II – Projects implemented by companies co-controlled by Polnord SA. Data weighted with Polnord SA’s share

Warsaw

Ostoja Wilanów VI-VIII 2 271 2 029 15% 356 18%

Stacja Kazimierz I - - - - - -

Stacja Kazimierz II - - - - - -

Wrocław

Osiedle Moderno - - - - - -

Apartamenty Innova - 66 430 3% 120 28%

Apartamenty Innova B 25 1 818 10 911 78% 2 671 24%

Tri-City

Aquasfera (building T2) 2 134 576 4% - -

Total Part II 29 2 288 13 946 100% 3 146 23%

Summary Part I and II

Total Part I and II 658 35 872 189 099 100% 17 634 9%

Data weighted with Polnord SA’s share


31

Att. 11 Profit and Loss StatementDescription [PLN ‘000] Q1-3 2017 Q1-3 2018 Change

Sales revenue 147 913 185 143 25.17%

Revenue from sale of goods and materials 137 481 175 245 27.47%

Revenues from sale of services 4 829 3 326 -31.12%

Rent revenue 5 603 6 572 17.29%

Prime costs of sales -115 627 -161 089 39.32%

Profit (loss) from sales before tax 32 286 24 054 -25.50%

Revaluation of investment property - -1 951 -

Selling costs -6 494 -6 006 -7.51%

Costs of general management -17 261 -22 989 33.18%

Other operating revenue 1 238 19 814 1 500.48%

Other operating expenses -8 412 -24 436 190.49%

Operating profit (loss) before tax 1 357 -11 514 -

Financial revenue 10 772 4 731 -56.08%

Financial expenses -10 044 -10 181 1.36%

Share in profit of entity valued with the equity method -741 -8 457 1 041.30%

Profit (loss) before tax 1 343 -25 420 -

Income tax -3 136 -12 299 292.19%

Net profit (loss) from continued operations -1 793 -37 719 2 003.68%

Net profit (loss) from discontinued operations - - -

Net profit (loss) -1 793 -37 719 2 003.68%

Att. 12 Adjusted EBIT

32

Adjusted EBIT [PLN mn]

Q1-3 2018 Q3 2018

Reported EBIT -11.5 -1.9

Normalisation adjustment - EBIT 5.79 3.39

Supreme Administrative Court’s decision - -

Revaluation of investment property - -

Adjustments related to KB Dom 12.4 -1.0

KOWR provisions [National Support Centre for Agriculture] -7.3 5.3

Adjustment of accounting errors from previous years -1.2 -

IFRS 9 -2.6 -0.9

VAT provision - -

Russia write-offs 1.1 -

Write-offs on investment projects - -

Write-offs on receivables 3.4 -

Provisions for liabilities - -

Normalised EBIT -5.72 1.48

33

Q1-3 2018 Q3 2018

Reported net result -37.7 -12.9

Normalisation adjustments - net result 18.8 5.9

Supreme Administrative Court’s decision - -

Revaluation of investment property - -

Adjustments related to KB Dom 10.7 -1.6

Fadesa -3.2 -

KOWR provisions [National Support Centre for Agriculture] -5.9 4.3

Adjustment of accounting errors from previous years 5.5 0.5

IFRS 9 -2.1 -0.4

Income tax adjustment - -

Tax asset write-off 10.0 3.0

VAT provisions and taxes - -

Russia write-offs 1.1 -

Case won regarding CIT - -

Write-offs on receivables 2.7 -

Write-offs on investment projects - -

Provisions for liabilities - -

Normalised net result -18.9 7.1

Att. 13 Adjusted net profit

Adjusted net profit [PLN mn]

34

Att. 14 Balance Sheet - AssetsDescription [PLN ‘000] As at 31.12.2017 As at 30.09.2018 Change

ASSETS

Non-current assets 727 144 548 518 -24.57%

Tangible fixed assets 9 202 2 211 -75.97%

Investment properties 382 682 251 701 -34.23%

Intangible assets 368 461 25.27%

Investments in entities, accounted for using the equity method 98 743 90 291 -8.56%

Goodwill 16 16 -

Non-current receivables 187 927 161 109 -14.27%

Other financial assets 94 3 207 3 311.70%

Deferred tax assets 48 112 39 521 -17.86%

Current assets (excluding assets classified as held for sales ) 732 663 636 186 -13.17%

Inventories 570 688 521 574 -8.61%

Trade and other receivables 26 931 12 115 -55.01%

Granted loans 1 948 2 018 3.59%

VAT and other tax, customs, insurance and other receivables 9 791 19 452 98.67%

Income tax receivables 2 363 1 766 -25.26%

Prepayments 1 205 533 -55.77%

Cash and cash equivalents 119 736 78 728 -34.25%

Assets classified as held for sale 8 681 159 745 1,740.17%

Current assets (including assets classified as held for sales) 741 344 795 931 7.36%

TOTAL ASSETS 1 468 488 1 344 450 -8.45%

35

Att. 15 Balance Sheet - LiabilitiesDescription [PLN ‘000] As at 31.12.2017 As at 30.09.2018 Change

LIABILITIES

Equity (to equity holders of parent company) 708 083 640 989 -9.48%

Share capital 65 386 65 386 -

Share premiums 936 835 936 835 -

Differences on recalculation of foreign units -8 777 -8 777 -

Other reserve capitals 204 772 204 772 -

Retained earnings/Uncovered losses -490 133 -557 227 13.69%

Total equity 708 083 640 989 -9.48%

Non-current liabilities 258 110 256 620 -0.58%

Interest-bearing bank loans and borrowings 255 780 253 073 -1.06%

Provisions 496 1 804 263.71%

Other liabilities 1 834 598 -67.39%

Deferred income tax provision - 1 145 -

Current liabilities 502 295 369 431 -26.45%

Trade and other liabilities 51 542 40 156 -22.09%

Current portion of long-term bank loans and borrowings 135 195 6 206 -95.41%

Other current loans and borrowings 27 071 15 672 -42.11%

VAT and other tax, customs, insurance and other liabilities 8 279 12 629 52.54%

Income tax liabilities - 561 -

Other financial liabilities 286 246 -13.99%

Accruals 4 722 4 360 -7.67%

Advances received 166 077 188 866 13.72%

Provisions 109 122 100 733 -7.69%

Liabilities related directly to fixed assets held for sale - 77 409 -

Total liabilities 760 405 703 460 -7.49%

TOTAL LIABILITIES 1 468 488 1 344 450 -8.45%

36

Att. 16 Cash flows

CASH FLOW STATEMENTFor the period from

01.01.2017 to30.09.2017

For the period from01.01.2018 to

30.09.2018Change

Cash flows from operating activities

Profit (loss) before tax (including profit from discontinued operations) 1 343 -25 420 -

Adjustments by items: 38 149 82 345 115.9%

Share in result of affiliated entities accounted for using the equity method 741 8 457 1 041.3%

Amortisation/depreciation 953 1 045 9.7%

Interest and dividends, net 7 464 12 907 72.9%

Profit (loss) from investing activities -12 907 1 629 -

(Increase) / decrease in receivables -23 920 31 973 -

(Increase) / decrease in inventories -31 910 49 114 -

(Increase) / decrease in liabilities, excluding loans and borrowings 75 324 14 477 -80.8%

Change in prepayments and accruals 13 355 310 -97.7%

Change in provisions 5 642 -7 081 -

Income tax paid 1 647 -1 926 -

Other 1 761 815 -53.7%

Effect of IFRS 9 on non-current receivables - -29 375 -

Net cash from operating activities 39 492 56 925 44.1%

37

Att. 17 Cash flows


01.01.2017 to30.09.2017

For the period from 01.01.2018 to

30.09.2018Change

Cash flows from investing activities

Inflows 18 278 3 310 -81.9%

Sale of property, plant and equipment and intangible assets 19 - -

Sale of investment property - - -

Sale of financial assets 1 402 140 -90.0%

Iterest received 9 007 - -

Rpayment of loans granted 7 850 - -

Dividends received - 3 170 -

Outflows -20 598 -4 135 -79.9%

Acquisition of property, plant and equipment and intangible assets -748 -575 -23.1%

Acquisition of investment property - -539 -

Acquisition of financial assets - - -

Acquisition of a subsidiary, after deduction of acquired cash -18 720 - -

Granting of loans -1 130 -3 021 167.3%

Net cash from investing activities -2 320 -825 -64.4%

38

Att. 18 Cash flows


01.01.2017 to30.09.2017

For the period from01.01.2018 to

30.09.2018Change

Cash flows from financing activities

Inflows 61 003 74 400 22.0%

Inflows from share issue - - -

Inflows from loans/credits drawn 29 785 - -100.0%

Inflows from bond issue 31 218 74 400 138.3%

Outflows -117 964 -168 504 42.8%

Repayment of finance lease 65 - -

Loan/credit repayment -32 912 -52 600 59.8%

Interest paid -15 037 -8 481 -43.6%

Bond redemption -69 950 107 413 -253.6%

Pozostałe - 10 -

Net cash from financing activities -56 961 -94 104 65.2%

Net increase (decrease) in cash and cash equivalents -19 788 -38 004 92.1%

Net exchange differences

Cash opening balance 143 520 119 736 -16.6%

Cash at end of period, including 123 731 81 732 -33.9%

of limited disposability 13 569 38 454 183.39%

DISCLAIMER:This study has been prepared solely for information purposes and is not intended to induce acquisition or sale of any financial instruments. The studydoes not constitute advertising, offer or proposing the purchase of financial instruments. It uses sources of information that Polnord SA considerscredible and accurate, but there is no guarantee that they are comprehensive and fully reflect the facts. The study may include statements regardingthe future, which constitute an investment risk or source of doubt and may significantly differ from actual results. Polnord SA is not liable for anyeffects of decisions which have been made based on this study. The study should not be treated as a source of knowledge sufficient to make aninvestment decision. Responsibility for the use of information contained in the study lies solely with the recipient .The study is subject to protectionresulting from the Copyright and Derivative Rights Act. Copying, publishing or distributing it requires the written consent of Polnord SA

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