Silvano Fashion Group

Quarterly Report • Aug 6, 2021

AS Silvano Fashion Group

Consolidated Interim Financial Report for Q2 and 6 months of 2021 (unaudited)

(translation of the Estonian original) *

Beginning of the reporting period 1 January 2021 End of the reporting period 30 June 2021 Business name AS Silvano Fashion Group Registration number 10175491 Legal address Tulika 17, 10613 Tallinn Telephone +372 684 5000 Fax +372 684 5300 E-mail info@silvanofashion.com Website www.silvanofashion.com Core activities Design, manufacturing and distribution of women's lingerie Auditor Ernst & Young Baltic AS

* This version of our report is a translation from the original, which was prepared in Estonian. All possible care has been taken to ensure that the translation is an accurate representation of the original. However, in all matters of interpretation of information, views or opinions, the original language version of our report takes precedence over this translation.

Management Report 3
Declaration of the Management Board 10
Consolidated Statement of Financial Position 11
Consolidated Income Statement 12
Consolidated Statement of Comprehensive Income 12
Consolidated Statement of Cash Flows 13
Consolidated Statement of Changes in Equity 14
Notes to the Interim Report 15
Note 1 Summary of significant accounting policies 15
Note 2 Cash and cash equivalents 15
Note 3 Trade and other receivables 15
Note 4 Inventories 16
Note 5 Property, plant and equipment 16
Note 6 Trade and other payables 17
Note 7 Equity 17
Note 8 Earnings per share 17
Note 9 Revenue from contracts with customers 17
Note 10 Transactions with related parties 18
Note 11 Operating segments 18

Management Report

General information about AS Silvano Fashion Group

AS Silvano Fashion Group (hereinafter "the Group") is a holding company that controls group of entities involved in the design, manufacturing, wholesale, franchise and retail sales of ladies lingerie. The Group's revenue is generated by sales of Milavitsa, Alisee, Aveline, Lauma Lingerie, Laumelle and Hidalgo brand products through wholesale channels, franchised sales and own retail operated via Milavitsa and Lauma Lingerie retail stores. Key sales markets for the Group are Russia, Belarus, Ukraine, other CIS countries and the Baltics.

The parent company of the Group is AS Silvano Fashion Group (hereinafter "the Parent company"), which is domiciled in Estonia. AS Silvano Fashion Group registered address is Tulika 17, Tallinn, Estonia.

The shares of the Group are listed on the Nasdaq OMX Tallinn Stock Exchange and on the Warsaw Stock Exchange.

As of 30 June 2021 the Group employed 1 696 people (as of 31 December 2020: 1 744 people).

The Group comprises of the following entities:

Parent company	Location	Main activity	Ownership interest 30.06.2021	Ownership interest 31.12.2020
AS Silvano Fashion Group	Estonia	Holding
Entities belonging to the Silvano Fashion Group
Silvano Fashion ZAO	Russia	Retail and Wholesale	100%	100%
Silvano Fashion OOO	Belarus	Retail and Wholesale	100%	100%
Silvano Fashion TOV	Ukraine	Wholesale	100%	100%
Silvano Fashion SIA	Latvia	Retail	100%	100%
Milavitsa SP ZAO	Belarus	Manufacturing and Wholesale	85.02%	85.02%
Yunona OAO	Belarus	Manufacturing and Wholesale	58.33%	58.33%
Gimil OOO	Belarus	Manufacturing and Wholesale	100%	100%
Lauma Lingerie AS	Latvia	Manufacturing and Wholesale	100%	100%
Alisee SARL	Monaco	Holding	99%	99%
Stolichnaja Torgovaja Kompanija "Milavitsa" ZAO	Russia	Holding	100%	100%
Baltsped logistik OOO	Belarus	Logistics	50%	50%

Business environment and results

The Group's sales amounted to 23 225 thousand EUR during the 6 months of 2021, representing a 31.0% increase as compared to the same period for the previous year. The Group's gross profit during the 6 months of 2021 amounted to 13 661 thousand EUR and increased by 29.2% compared to 6 months of 2020. The Gross margin during the 6 months of 2021 decreased to 58.8% from 59.6% as compared to 6 months of 2020.

Consolidated operating profit for 6 months of 2021 increased by 99.4% to 7 941 thousand EUR, compared to 3 983 thousand EUR in 6 months of 2020. Consolidated EBITDA for 6 months of 2021 increased by 60.7% and was 9 533 thousand EUR, compared to 5 931 thousand EUR in 6 months of 2020.

Reported consolidated net profit for 6 months of 2021 amounted to 6 696 thousand EUR, as compared to net profit of 870 thousand EUR in the prior year's same period. Net profit attributable to equity holders of the Parent company for 6 months of 2021 increased by 709.5% and amounted to 6 031 thousand EUR.

Russia Economic Outlook

The Group's sales on the Russian market totalled 13 730 thousand EUR, increase is 45.6% compared to 6 months of 2020. Local currency sales increased by 74.9% during 6 months of 2021 compared to the same 6 months of 2020. At the end of the reporting period, there were a total of 47 stores operated by the Group itself.

Belarus Economic Outlook

The Group's sales in Belarus in the 6 months of 2021 were 5 558 thousand EUR and decreased by 5.2% compared to the 6 months of 2020. Sales in local currency increased by 14.4% during the same period. There are currently a total of 61 stores operated by the Group itself.

Ukraine Economic Outlook

The Group's sales in Ukraine in the 6 months of 2021 were 815 thousand EUR and increased by 97.3% compared to the 6 months of 2020. Sales in local currency increased by 128.7% during the same period.

Sales structure

Sales by markets

Group sales in its 3 major markets – Russia, Belarus and Ukraine – were 86.5% of its total sales. Measured in local currencies sales increase was accordingly – 74.9% in Russia, 14.4% in Belarus and 128.7% in Ukraine.

	06m 2021	06m 2020	Change	Change, %
Russia, th RUB	1 219 365	697 278	522 087	74.9%
Belarus, th BYN	17 243	15 074	2 169	14.4%
Ukraine, th UAH	27 124	11 858	15 266	128.7%

Group`s sales results by markets measured in EUR are presented below:

	06m 2021	06m 2020	Change, EUR	Change, %	06m 2021,	06m 2020,
in thousands of EUR					% of sales	% of sales
Russia	13 730	9 429	4 301	45.6%	59.1%	53.2%
Belarus	5 558	5 863	-305	-5.2%	23.9%	33.1%
Ukraine	815	413	402	97.3%	3.5%	2.3%
Baltics	503	454	49	10.8%	2.2%	2.5%
Other markets	2 619	1 572	1 047	66.6%	11.3%	8.9%
Total	23 225	17 731	5 494	31.0%	100.0%	100.0%

The majority of lingerie sales revenue during 6 months of 2021 in the amount 13 730 thousand EUR was generated in Russia, accounting for 59.1% of total sales. The second largest market was Belarus, where sales were 5 558 thousand EUR, contributing 23.9% of lingerie sales (both retail and wholesale). Volumes in Ukraine were 815 thousand EUR, accounting for 3.5% of total sales.

Sales by business segments

	06m 2021	06m 2020	Change, EUR	Change, %	06m 2021,	06m 2020,
in thousands of EUR					% of sales	% of sales
Wholesale	15 572	11 114	4 458	40.1%	67.0%	62.7%
Retail	7 590	6 538	1 052	16.1%	32.7%	36.9%
Other operations	63	79	-16	-20.3%	0.3%	0.4%
Total	23 225	17 731	5 494	31.0%	100.0%	100.0%

During 6 months of 2021 wholesale revenue amounted to 15 572 thousand EUR, representing 67.0% of the Group's total revenue (6 months of 2020: 62.7%). The main wholesale regions were Russia, Belarus and Ukraine.

Our retail revenue increased by 16.1% and amounted to 7 590 thousand EUR, this represents 32.7% of the Group`s total revenue.

Own & franchise store locations, geography

	Own	Franchise	Total
Russia	47	352	399
Ukraine	0	20	20
Belarus	61	0	61
Baltics	5	21	26
Other regions	0	89	89
Total	113	482	595

At the end of the reporting period the Group and its franchising partners operated 563 Milavitsa and 32 Lauma Lingerie brand stores, including 113 stores operated directly by the Group.

Selected Financial Indicators

Summarized selected financial indicators of the Group for 6 months of 2021 compared to 6 months of 2020 and 30.06.2021 compared to 31.12.2020 were as follows:

in thousands of EUR	06m 2021	06m 2020	Change
Revenue	23 225	17 731	31.0%
Gross Profit	13 661	10 575	29.2%
Operating profit	7 941	3 983	99.4%
EBITDA	9 533	5 931	60.7%
Net profit for the period	6 696	870	669.7%
Net profit attributable equity holders of the Parent company	6 031	745	709.5%
Earnings per share (EUR)	0,17	0,02	750.0%
Operating cash flow for the period	8 055	2 742	193.8%
in thousands of EUR	30.06.2021	31.12.2020	Change
Total assets	49 446	42 256	17.0%
Total current assets	36 381	29 597	22.9%
Total equity attributable to equity holders of the Parent company	30 497	24 504	24.5%
Cash and cash equivalents	14 022	8 980	56.1%
Margin analysis, %	06m 2021	06m 2020	Change
Gross profit	58.8	59.6	-1.3%
Operating profit	34.2	22.5	52.0%
EBITDA	41.0	33.4	22.8%
Net profit	28.8	4.9	487.8%
Net profit attributable to equity holders of the Parent company	26.0	4.2	519.0%
Financial ratios, %	30.06.2021	31.12.2020	Change
ROA	23.7	3.2	640.6%
ROE	40.2	5.6	617.9%
Price to earnings ratio (P/E)	5.5	41.7	-86.8%
Current ratio	4.0	3.4	17.6%
Quick ratio	1.8	1.3	38.5%

Underlying formulas:

EBITDA = net profit for the period + depreciation and amortisation + net financial income + income tax expense Gross profit margin = gross profit / revenue

EBITDA margin = EBITDA / revenue

Net profit margin = net profit / revenue

Net profit margin attributable to equity holders of the Parent company = net profit attributable to equity holders of the Parent company / revenue

ROA (return on assets) = net profit attributable to owners of the Company for the last 4 quarters/ average total assets

ROE (return on equity) = net profit attributable to owners of the Company for the last 4 quarters/ average equity attributable to equity holders of the Company

EPS (earnings per share) = net profit attributable to owners of the Company/ weighted average number of ordinary shares Price to earnings ratio = Share price at the end of reporting period/earnings per share, calculated based on the net profit attributable to owners of the Company for the last 4 quarters

Current ratio = current assets / current liabilities

Quick ratio = (current assets – inventories) / current liabilities

Financial performance

The Group`s sales amounted to 23 225 thousand EUR during 6 months of 2021, representing a 31.0% increase as compared to the same period of previous year. Overall, wholesale increased by 40.1%, measured in EUR.

The Group's gross profit during 6 months of 2021 amounted to 13 661 thousand EUR and increase by 29.2% compared to previous year. The gross margin during 6 months of 2021 decreased to 58.8%, from 59.6% in the respective period of previous year. The cost of sold goods increased by 33.7%.

Consolidated operating profit for 6 months of 2021 amounted to 7 941 thousand EUR, compared to 3 983 thousand EUR in 6 months of 2020, increase by 99.4%. The consolidated operating profit margin was 34.2% for 6 months of 2021 (22.5% in 6 months of 2020). Consolidated EBITDA for 6 months of 2021 increased by 60.7% and amounted to 9 533 thousand EUR, which is 41.0% in margin terms (5 931 thousand EUR and 33.4% for 6 months of 2020).

Reported consolidated net profit attributable to equity holders of the Parent company for 6 months of 2021 amounted to 6 031 thousand EUR, compared to net profit of 745 thousand EUR in 6 months of 2020, net profit margin attributable to equity holders of the Parent company for 6 months of 2021 was 26.0% against 4.2% in 6 months of 2020.

Financial position

As of 30 June 2021 consolidated assets amounted to 49 446 thousand EUR representing increase by 17.0% as compared to the position as of 31 December 2020.

Trade and other receivables increased by 273 thousand EUR as compared to 31 December 2020 and amounted to 2 361 thousand EUR as of 30 June 2021. Inventory balance increased by 1 469 thousand EUR and amounted to 19 996 thousand EUR as of 30 June 2021.

Equity attributable to equity holders of the Parent company increased by 5 993 thousand EUR and amounted to 30 497 thousand EUR as of 30 June 2021. Current liabilities increased by 255 thousand EUR during 6 months of 2021.

Investments

During 6 months of 2021 the Group's investments into property, plant and equipment totalled 120 thousand EUR, in previous year same period 133 thousand EUR. Investments were made mainly into opening and renovating own stores, as well into equipment and facilities to maintain effective production for future periods.

Personnel

As of 30 June 2021, the Group employed 1 696 employees, including 518 people in retail operations. The rest were employed in production, wholesale, administration and support operations. In 31.12.2020 there were 1 744 employees, including 500 people in retail operations.

Total salaries and related taxes during 6 months of 2021 amounted to 4 745 thousand EUR (5 008 thousand EUR in 6 months of 2020). The remuneration of key management of the Group, including the key executives of all subsidiaries, totalled 293 thousand EUR.

Decisions made by governing bodies during 6 months 2021

On June 22, 2021 Silvano Fashion Group held its regular Annual General Meeting of Shareholders. The Meeting adopted the following decisions.

• The Meeting approved the 2020 Annual Report.

• The Meeting decided leave the net profit undistributed and include the net profit of the financial year 2020 in retained earnings.

Shares of AS Silvano Fashion Group

As of 30 June 2021 registered share capital of AS Silvano Fashion Group amounted to 3 600 thousand EUR divided into 36 000 000 ordinary shares with a nominal value of 0.10 EUR each. The share register is electronic and maintained at the Estonian Central Register of Securities. The Company has been listed on Nasdaq OMX Tallinn Stock Exchange main list (since 21.11.2006) and on Warsaw Stock Exchange (since 23.07.2007).

As of 30 June 2021 AS Silvano Fashion Group 3 126 shareholders (as of 31 December 2020: 2 931 shareholders).

As of 30 June 2021 shareholders, whose interest in AS Silvano Fashion Group exceeded 5% included:

AS Silvano Fashion Group Consolidated Interim Financial Report for Q2 and 6 months of 2021

Name	Number of shares	Shareholding
Major shareholders	18 833 428	52.31%
BALTPLAST AS	9 000 000	25.00%
AS SEB PANK CLIENTS	8 000 000	22.22%
Clearstream Banking AG	1 833 428	5.09%
Other shareholders	17 166 572	47.69%
Total number of shares	36 000 000	100.00%

As of 31 December 2020 shareholders, whose interest in AS Silvano Fashion Group exceeded 5% included:

Name	Number of shares	Shareholding
Major shareholders	16 820 000	46.72%
BALTPLAST AS	8 820 000	24.50%
AS SEB PANK CLIENTS	8 000 000	22.22%
Other shareholders	19 180 000	53.28%
Total number of shares	36 000 000	100.00%

Share price development and turnover on the Tallinn Stock Exchange during 6 months of 2021 (EUR)

During 6 months of 2021 the highest and lowest prices of the AS Silvano Fashion Group` share on the Tallinn Stock Exchange were 1.695 EUR and 1.55 EUR, respectively

Share price development on the Warsaw Stock Exchange during 6 months of 2021 (PLN)

During 6 months of 2021, the highest and lowest prices of the AS Silvano Fashion Group` share on the Warsaw Stock Exchange were 8.20 PLN and 6.66 PLN respectively.

Declaration of the Management Board

The Management Board of AS Silvano Fashion Group has reviewed and approved Consolidated Interim Financial Report for Q2 and 6 months of 2021 (hereinafter "the Interim Report").

Member of the Management Board confirms that according to his best knowledge the Interim Report gives a true and fair view of financial position of the Group, its financial performance and its cash flows in accordance with International Financial Reporting Standards, as adopted by EU, and IAS 34 "Interim Financial Reporting".

Furthermore, Member of the Management Board confirms that in his opinion the Interim Report provides a fair review of significant developments in the Group's activities that occurred during the reporting period and their impact and describes significant risks and uncertainties that may affect the Group during future reporting periods.

The Interim Report has not been audited or otherwise reviewed by the auditors.

Jarek Särgava Member of the Management Board August 06, 2021

___________________________

Consolidated Statement of Financial Position

in thousands of EUR	Note	30.06.2021	31.12.2020
		Unaudited	Audited
ASSETS
Current assets
Cash and cash equivalents	2	14 022	8 980
Current loans granted		2	2
Trade and other receivables	3	2 361	2 088
Inventories	4	19 996	18 527
Total current assets		36 381	29 597
Non-current assets
Long-term receivables		268	249
Investments in associates		59	57
Investments in other shares		250	238
Deferred tax asset		1 091	1 032
Intangible assets		462	374
Investment property		1 053	1 018
Property, plant and equipment	5	9 882	9 691
Total non-current assets		13 065	12 659
TOTAL ASSETS		49 446	42 256
LIABILITIES AND EQUITY
Current liabilities
Short-term borrowings		0	400
Short-term lease liabilities		1 283	2 121
Trade and other payables	6	5 815	5 583
Goverment Grants		56	0
Tax liabilities		1 880	675
Total current liabilities		9 034	8 779
Non-current liabilities
Deferred tax liability		584	500
Long-term borrowings		0	400
Long-term lease obligations		5 707	4 707
Long-term provisions		55	52
Total non-current liabilities		6 346	5 659
Total liabilities		15 380	14 438
Equity
Share capital	7	3 600	3 600
Share premium		4 967	4 967
Statutory reserve capital		1 306	1 306
Revaluation reserve		0	355
Unrealised exchange rate differences		-18 547	-18 864
Retained earnings		39 171	33 140
Total equity attributable to equity holders of the
Parent company		30 497	24 504
Non-controlling interest		3 569	3 314
Total equity		34 066	27 818
TOTAL EQUITY AND LIABILITIES		49 446	42 256

Consolidated Income Statement

in thousands of EUR	Note	2Q 2021	2Q 2020	06m 2021	06m 2020
		Unaudited	Unaudited	Unaudited	Unaudited
Revenue from contracts with customers	9	12 960	6 185	23 225	17 731
Cost of goods sold		-5 541	-2 756	-9 564	-7 156
Gross Profit		7 419	3 429	13 661	10 575
Distribution expenses		-2 094	-1 713	-4 204	-4 447
Administrative expenses		-903	-811	-1 788	-1 933
Other operating income		385	70	566	129
Other operating expenses		-151	-144	-294	-341
Operating profit		4 656	831	7 941	3 983
Currency exchange income/(expense)		605	2 174	1 060	-2 556
Other finance income/(expenses)		-106	-109	-216	-234
Net financial income		499	2 065	844	-2 790
Profit (loss) from associates using equity method		5	0	-1	0
Profit before tax		5 160	2 896	8 784	1 193
Income tax expense		-1 028	-586	-2 088	-323
Profit for the period		4 132	2 310	6 696	870
Attributable to :
Equity holders of the Parent company		3 770	2 151	6 031	745
Non-controlling interest		362	159	665	125
Earnings per share from profit attributable to
equity holders of the Parent company, both basic and diluted (EUR)	8	0,10	0,06	0,17	0,02

Consolidated Statement of Comprehensive Income

in thousands of EUR	Note	2Q 2021	2Q 2020	06m 2021	06m 2020
		Unaudited	Unaudited	Unaudited	Unaudited
Profit for the period		4 132	2 310	6 696	870
Other comprehensive income (loss) that will be reclassified to profit or loss in subsequent periods :
Exchange differences on translation of foreign
operations		40	166	269	-2 059
Total other comprehensive income for the period		40	166	269	-2 059
Total comprehensive income (loss) for the
period		4 172	2 476	6 965	-1 189
Attributable to :
Equity holders of the Parent company		3 829	2 331	5 993	-1 652
Non-controlling interest		343	145	972	463

Consolidated Statement of Cash Flows

in thousands of EUR	06m 2021	06m 2020
	Unaudited	Unaudited
Cash flow from operating activities
Profit for the period	6 696	870
Adjustments for:
Depreciation and amortization of non-current assets	1 592	1 948
Share of profit of equity accounted investees	1	0
(Gains)/ losses on the sale of property, plant and equipment	0	3
Net finance income / costs	-596	212
Provision for inventories	4	1
Receipt of government grants	450	0
Movements in provisions and government grants	-394	0
Income tax expense	2 088	323
Change in inventories	-1 469	1 114
Change in trade and other receivables	-289	219
Change in trade and other payables	639	-1 210
Interest paid	-2	0
Income tax paid	-665	-738
Net cash from operating activities	8 055	2 742
Cash flow from investing activities
Interest received	9	7
Proceeds from disposal of property, plant and equipment	18	28
Acquisition of property, plant and equipment	-120	-133
Acquisition of intangible assets	-82	-67
Net cash flow from investing activities	-175	-165
Cash flow from financing activities
Acquisition of non-controlling interests	0	-26
Proceeds from borrowings	0	200
Repayment of borrowings	-800	0
Payment of principal portion of lease liabilities	-1 135	-1 006
Interest paid on finance lease	-224	-255
Dividends paid	-717	-474
Net cash flow from financing activities	-2 876	-1 561
Increase in cash and cash equivalents	5 004	1 016
Cash and cash equivalents at the beginning of period	8 980	5 152
Effect of exchange rate fluctuations on cash held	38	184
Cash and cash equivalents at the end of period	14 022	6 352

Consolidated Statement of Changes in Equity

in thousands of EUR	Share Capital	Share Premium	Statutory reserve capital	Revaluation reserve	Unrealised exchange rate differences	Retained earnings	Total equity attributable to equity holders of the Parent company	Non controlling interest	Total equity
Balance as at 31 December 2019	3 600	4 967	1 306	355	-15 697	31 793	26 324	3 427	29 751
Profit for the period	0	0	0	0	0	745	745	125	870
Other comprehensive income for the period	0	0	0	0	-2 397	0	-2 397	338	-2 059
Total comprehensive income for the period	0	0	0	0	-2 397	745	-1 652	463	-1 189
Transactions with owners, recognised directly in equity
Dividends declared	0	0	0	0	0	0	0	-474	-474
Total transactions with owners, recognised directly in
equity	0	0	0	0	0	0	0	-474	-474
(unaudited) Balance as at 30 June 2020	3 600	4 967	1 306	355	-18 094	32 538	24 672	3 416	28 088
Balance as at 31 December 2020	3 600	4 967	1 306	355	-18 864	33 140	24 504	3 314	27 818
Profit for the period	0	0	0	0	0	6 031	6 031	665	6 696
Other comprehensive income for the period	0	0	0	-355	317	0	-38	307	269
Total comprehensive income for the period	0	0	0	-355	317	6 031	5 993	972	6 965
Transactions with owners, recognised directly in equity
Dividends declared	0	0	0	0	0	0	0	-717	-717
Total transactions with owners, recognised directly in
equity	0	0	0	0	0	0	0	-717	-717
Balance as at 30 June 2021 (unaudited)	3 600	4 967	1 306	0	-18 547	39 171	30 497	3 569	34 066

Notes to the Interim Report

Note 1 Summary of significant accounting policies

AS Silvano Fashion Group is a company registered in Estonia. This Interim Report of the Group is prepared for the reporting period ended 30 June 2021 and comprises parent company and its subsidiaries.

The principal accounting policies applied in the preparation of this Interim Report are set out below. The policies have been consistently applied to all the years presented unless otherwise stated.

The Interim Report has not been audited or reviewed by external auditors.

Basis for preparation

This Interim Report of AS Silvano Fashion Group for 6 months of 2021 ended on 30 June 2021 has been prepared in accordance with IAS 34 "Interim financial reporting" as adopted by the European Union. The Interim Report should be read in conjunction with the Annual Report for the financial year ended on 31 December 2020, which have been prepared in accordance with IFRS as adopted by the European Union.

This Interim Report is comprised in thousands of Euros (EUR).

The Group's performance is not significantly affected by any seasonal or cyclical factors. Nevertheless, revenue during vacation periods and holidays in CIS countries is usually higher compared to other periods.

New standards and interpretations

In additions to disclosures already made in the Annual Report for the financial year ended on 31 December 2020 there are no new IFRSs or IFRIC interpretations that are effective for the financial year beginning on or after 1 January 2021 and that would be expected to have a material impact on the Group.

Note 2 Cash and cash equivalents

in thousands of EUR	30.06.21	31.12.20
Cash on hand	60	66
Current bank accounts in EUR	13 464	8 302
Current bank accounts in other currencies than EUR	138	208
Short-term bank deposits in all currencies	284	211
Short-term guarantee deposits	13	20
Cash in transit	63	173
Total	14 022	8 980

Note 3 Trade and other receivables

in thousands of EUR	30.06.21	31.12.20
Trade receivables from third parties	1 351	1 079
Trade receivables from related parties	59	0
Impairment of receivables	-58	-57
Tax prepayments	509	471
Other receivables	500	595
Total	2 361	2 088

The fair values of trade and other receivables are not materially different from the carrying values based on the expected discounted cash flows.

Note 4 Inventories

in thousands of EUR	30.06.21	31.12.20
Raw and other materials	3 186	3 691
Work in progress	932	954
Finished goods	14 747	13 065
Other inventories	1 131	817
Total	19 996	18 527

Note 5 Property, plant and equipment

in thousands of EUR			Other
			equipment		Assets
	Land and	Plant and	and	Right-of	under
	buildings	equipment	fixtures	use asset	construction	Total
31.12.2019
Cost	5 781	17 834	5 354	11 564	63	40 596
Accumulated depreciation	-2 729	-14 623	-4 171	-2 821	0	-24 344
Net book amount	3 052	3 211	1 183	8 743	63	16 252
Movements during 06m 2020
Additions	0	0	47	359	86	492
Disposals	0	0	-31	0	0	-31
Reclassifications	0	65	53	0	-118	0
Depreciation	-62	-352	-367	-1 140	0	-1 921
Unrealised exchange rate differences	-393	-381	-106	-1 049	-8	-1 937
Closing net book amount	2 597	2 543	779	6 913	23	12 855
30.06.2020
Cost	5 045	15 786	4 829	10 502	23	36 185
Accumulated depreciation	-2 448	-13 243	-4 050	-3 589	0	-23 330
Net book amount	2 597	2 543	779	6 913	23	12 855
31.12.2020
Cost	3 709	13 734	4 271	9 372	34	31 120
Accumulated depreciation	-1 932	-11 789	-3 671	-4 037	0	-21 429
Net book amount	1 777	1 945	600	5 335	34	9 691
Movements during 06m 2021
Additions	0	7	60	1 173	53	1 293
Disposals	0	0	-18	0	0	-18
Reclassifications	0	1	51	0	-52	0
Depreciation	-45	-267	-165	-1 102	0	-1 579
Unrealised exchange rate differences	90	94	36	273	2	495
Closing net book amount	1 822	1 780	564	5 679	37	9 882
30.06.2021
Cost	3 892	14 349	4 521	11 013	37	33 812
Accumulated depreciation	-2 070	-12 569	-3 957	-5 334	0	-23 930
Net book amount	1 822	1 780	564	5 679	37	9 882

The Group didn't have any significant binding commitments to purchase property plant and equipment as of 30 June 2021.

in thousands of EUR	30.06.21	31.12.20
Trade payables	3 763	4 086
Accrued expenses	529	405
Provisions	29	37
Other payables	1 494	1 055
Total	5 815	5 583

Note 6 Trade and other payables

Fair values of trade and other payables are not materially different from book values due to short maturities.

Note 7 Equity

Shares

As of 30 June 2021 registered share capital of AS Silvano Fashion Group amounted to 3 600 thousand EUR divided into 36 000 000 shares with a nominal value of 0.10 EUR each (as of 31 December 2020, 3 600 thousand EUR 36 000 000 shares and 0.10 EUR nominal value, respectively). All shares of AS Silvano Fashion Group are ordinary shares and all are registered. Each ordinary share gives a shareholder one vote in General Meeting of Shareholders. No share certificates are issued for registered shares. The share register is electronic and maintained at the Estonian Central Depositary for Securities. All shares are fully paid shares.

As of 30 June 2021 AS Silvano Fashion Group had 3 126 shareholders (as of 31 December 2020: 2 931 shareholders).

Note 8 Earnings per share

The calculation of basic earnings per share for 6 months of 2021 (6 months of 2020) is based on profit attributable to owners and a weighted average number of ordinary shares.

in thousands of shares	06m 2021	06m 2020
Number of ordinary shares at the beginning of the period	36 000	36 000
Effect of own shares held at the beginning of the period	0	0
Number of ordinary shares at the end of the period	36 000	36 000
Effect of own shares held at the end of the period	0	0
Weighted average number of ordinary shares for the period	36 000	36 000
in thousands of EUR	06m 2021	06m 2020
Profit for the period attributable to equity holders of the Parent company	6 031	745
Basic earnings per share (EUR)	0.17	0.02
Diluted earnings per share (EUR)	0.17	0.02

Diluted earnings per share do not differ from basic earnings per share as the Group has no financial instruments issued that could potentially dilute the earnings per share.

Note 9 Revenue from contracts with customers

in thousands of EUR	06m 2021	06m 2020
Revenue from wholesale	15 572	11 114
Revenue from retail	7 590	6 538
Subcontracting and services	58	75
Other sales	5	4
Total	23 225	17 731

Note 10 Transactions with related parties

The following parties are considered to be related;

• a) Shareholders owning, directly or indirectly, a voting power in the parent company or its significant subsidiaries that gives them significant influence over the parent company or its significant subsidiaries and companies under their control.
• b) Associates enterprises in which parent company or its subsidiaries have significant influence;
• c) Members of the Management Board and Supervisory Boards of parent company and its significant subsidiaries and their immediate family members and companies under their control or significant influence.

The Group's owners are legal and physical persons and no sole shareholder has control over the Group's activities. According to management's assessment, the prices applied in transactions with related parties did not differ significantly from the market terms.

Sales of goods and services
in thousands of EUR	06m 2021	06m 2020
Associates	360	89
Total	360	89
Balances with related parties
in thousands of EUR	30.06.2021	31.12.2020
Trade receivables from associates	59	0
Total	59	0
Benefits to key management of the group
in thousands of EUR	06m 2021	06m 2020

Remunerations and benefits	293	389
Total	293	389

Note 11 Operating segments

The Group`s operating segments have been determined based on regular reports being monitored and analysed by Management and Supervisory Boards of the parent company on an on-going basis.

The Management and Supervisory Board consider the business primarily from the activity perspective, monitoring separately wholesale and retail activities.

• The wholesale segment includes purchasing and production of women's lingerie, and distribution to external wholesale customers and the retail segment. The Group's manufacturing facilities are located in Latvia and Belarus.
• The retail segment sells the lingerie through own retail network in Latvia, Belarus and Russia.

There is a strong integration between wholesale and retail segments. The accounting policies of reportable segments are the same. Management estimates that intersegment transactions have been done on arm's length basis.

Primary measures monitored by the Supervisory Board are segment revenues, segment EBITDA (which is defined as profit before depreciation, amortisation, net financial income, income tax expense and gain on net monetary position) and segment net profit. These measures are included in the internal management reports that are reviewed by the Management Board and the Supervisory Board. Segment EBITDA is used to measure performance as management believes that such information is the most relevant in evaluating the results of certain segment relative to other entities that operate within the industry.

Interest income and interest expenses are not core activities of operating segments and are not provided to management and are not evaluated by management as performance assessment criteria of segments' performance. Therefore, interest income and interest expenses are presented on net basis.

Unallocated revenues include revenues from services, commissions and rental income. Unallocated assets include cash and bank deposits not used in daily operations of either of the segments.

AS Silvano Fashion Group Consolidated Interim Financial Report for Q2 and 6 months of 2021

Operating segments	06m 2021	and as of 30.06.2021
	Lingerie		Total
in thousands of EUR	retail	Lingerie wholesale	segments	Unallocated	Eliminations	Total
Revenue from external customers	7 590	15 572	23 162	63		23 225
Intersegment revenues	0	13 144	13 144	1 276	-14 420	0
EBITDA	3 634	5 614	9 248	285		9 533
Amortization and depreciation	-1 038	-281	-1 319	-273		-1 592
Operating income, EBIT	2 596	5 333	7 929	12	0	7 941
Profit from associates using equity method	0	-1	-1	0		-1
Net financial income	79	-123	-44	888		844
Income tax	-340	-1 049	-1 389	-699		-2 088
Net profit	2 335	4 160	6 495	201	0	6 696
Investments in associates	0	59	59	0		59
Other operating segments assets	4 435	29 192	33 627	15 760		49 387
Reportable segments liabilities	1 920	9 669	11 589	3 791		15 380
Capital expenditures	1 181	193	1 374	1		1 375
Number of employees as of reporting date	518	1 064	1 582	114		1 696

in thousands of EUR

Operating segments 06m 2020 and as of 30.06.2020

	Lingerie		Total
	retail	Lingerie wholesale	segments	Unallocated	Eliminations	Total
Revenue from external customers	6 538	11 114	17 652	79		17 731
Intersegment revenues	0	10 596	10 596	1 203	-11 799	0
EBITDA	2 691	3 111	5 802	129		5 931
Amortization and depreciation	-1 222	-392	-1 614	-334	0	-1 948
Operating income, EBIT	1 469	2 719	4 188	-205	0	3 983
Profit from associates using equity method	0	0	0	0	0	0
Net financial income	-135	-192	-327	-2 463	0	-2 790
Income tax	-129	-442	-571	248	0	-323
Net profit	1 205	2 085	3 290	-2 420	0	870
Investments in associates	0	71	71	0	0	71
Other operating segments assets	4 874	28 208	33 082	9 763	0	42 845
Reportable segments liabilities	1 883	9 560	11 443	3 385	0	14 828
Capital expenditures	434	71	505	54	0	559
Number of employees as of reporting date	491	1 145	1 636	148		1 784

Revenue and non-current assets breakdown by geographical areas

Revenues in the table below are based on the geographical location of customers; segment assets are based on the geographical location of the assets.

Geographical segments

in thousands of EUR	Revenue 06m 2021	Revenue 06m 2020	Non-current assets 30.06.2021	Non-current assets 31.12.2020
Russia	13 730	9 429	2 316	1 968
Belarus	5 558	5 863	10 377	10 341
Ukraine	815	413	0	1
Baltics	503	454	347	324
Other countries	2 619	1 572	25	25
Total	23 225	17 731	13 065	12 659