BUSINESS RESULTS 1/1/2024 - 30/9/2024

Tourism portfolio of Valamar

ABOUT VALAMAR

Valamar is Croatia's tourism leader operating in prime destinations – Istria, the islands of Krk, Rab and Hvar, Makarska, Dubrovnik, and Obertauern in Austria.

Valamar's 36 hotels and resorts and 15 camping resorts with a capacity of about 21 thousand units, can accommodate around 58 thousand guests daily.

With investments around EUR 915 million in the last 20 years, Valamar is one of the top regional investors to grow revenues and profitability and substantially increase quality. It is both Croatia's largest and highest rated employer in tourism.

Valamar Group (the "Group") consists of Valamar Riviera d.d. (the "Company") and two fully consolidated subsidiaries: Imperial Riviera d.d., Rab, (46.27% ownership), and Bugenvilia d.o.o., Dubrovnik, (100%).

Valamar Riviera has investments in two companies (the "Associated Companies"): Helios Faros d.d., Starigrad (20%) and Valamar A GmbH, Vienna, Austria (24.54%). We refer to Valamar Group and the Associated Companies together as "Valamar".

Imperial Riviera owns 55% of Praona d.o.o., Makarska a company engaged in laundry business.

Valamar structure

KEY MESSAGES

Following excellent peak season results, Valamar Group operating revenues for the first nine months of 2024 reached EUR 390,1 million. That is 12.2% more than last year and in line with budget. Business growth was fuelled by strong demand from key markets and previous investments in portfolio development, sales, marketing, and operational excellence. Premium segment hotels and camping resorts recorded the best results.

All Valamar destinations have shown very good performance, with Dubrovnik being our last destination to fully rebound to pre-pandemic levels, both financially and in number of overnights. Significant investments over the last two years in three Dubrovnik hotels and the Maro World children's animation complex have been wellreceived resulting in particularly high growth of the family guest segment.

Direct sales are the most profitable sales segment and a key tool to retain customers. Direct sales continued performing strongly with revenues amounting to EUR 206.3 million, accounting for 65% of all board revenues similar to the same period of 2023. Our guest structure remained stable, with around half of total overnights coming from German and Austrian guests.

In the first nine months of 2024, operating expenses increased by 16% to EUR 239.1 million. This was primarily due to continued strong spending in employee payroll and compensation (labour costs increased by EUR 17.8 million or nearly 18%). Operating profit (adjusted EBITDA) reached EUR 147.7 million, 4.6% higher than in the same period in 2023, with EBITDA margin down by 2.7 percentage points. Unfavourable weather conditions in September posed an impact on lower than planned revenues in postseason, together with increased costs related to tourist land and maritime property concession. Net profit was additionally hindered by EUR 4,6 million in extraordinary costs for legal cases and settlements as well as 3 million increase in depreciation, with Net profit down by EUR 3,4 million. Given the expected cost development and their dynamics in the last quarter of 2024, the Group expects to slightly improve in earnings margin by the end of the year.

OPERATING REVENUES HIGHER 12% COMPARED TO FIRST NINE MONTHS OF 2023

SIGNIFICANT INCREASES IN EMPLOYEE PAYROLL, TRAINING AND BENEFITS SPENDING

As of 30 September 2024, the Group's net debt amounts to EUR 189.5 million, a reduction of 13.0% over the reporting period. Almost the entire loan portfolio consists of long-term loans with fixed or hedged interest rates, thus protecting against an interest rate risk.

Investments in the Group's hotels, resorts and campsites for the 2023/24 season amounting to EUR 83 million were completed within budget. Valamar Riviera d.d. invested EUR 8.9 million in repositioning Allegro and Miramar hotels in Rabac to a new Sunny branded resort named Allegro Sunny Hotel & Residence 3*. EUR 5.7 million were invested to refurbish Koralj Sunny Hotel 3* on the island of Krk, further expanding the Sunny brand and providing an attractive value proposition for family guests.

The most significant investment of Imperial Riviera d.d. is the reconstruction of the existing Suha Punta resort (Arba Resort 4*/5* Valamar Collection) in Rab. This is a multiphase project whose goal is to firmly position Rab among the best family destinations in the Adriatic. The repositioning of the former 2* Rivijera resort into a 3* Makarska Sunny Resort has also been finalized and further strengthened the Sunny brand in Dalmatia.

Valamar Riviera's most significant investment underway is the construction of Pical 5* resort in Poreč, the largest single investment in Croatian tourism, amounting to EUR 139 million within a two-year period. Pical resort will be open year-round, with a wide array of premium amenities for various types of holidays, raising the destination offer in Poreč. Works began on 18 March 2024 and are planned for completion in early 2026.

Valamar Riviera also continued with significant increases in employee payroll, training and benefits spending. The Group has increased the base salary for more than 5,000 employees. Monthly salaries in the high season from June to August for professional positions, i.e. chefs, waiters and receptionists at Valamar hotels, campsites and resorts, ranged from EUR 1,400 to 2,000 net, while salaries for housekeepers, assistant chefs, assistant waiters, kitchen workers, servers and many others ranged from EUR 1,000 to 1,300 net. Valamar Group also continues with numerous programmes designed to reward excellence, commitment and outstanding performance.

In 2024, Valamar Group continued to invest in numerous sustainability initiatives following our ESG framework and strategic goals.

The Green Building Council Croatia and the Croatian Association of Thermal Insulation System Manufacturers awarded Valamar Riviera the "Organization of the Year" title at the 2023 Annual Green Building and Sustainable Built Environment Awards ceremony. Bike Centre Poreč, the largest in Croatia, was opened at the start of the well-known Parenzana cycling trail next to the Valamar Parentino 4* hotel. The centre, open to the local community, will significantly contribute to developing sustainable, green, digital, inclusive, and year-round sports and recreational tourism in Poreč and Istria.

CONTINUED STRONG INVESTMENTS IN STRATEGIC PROJECTS AND SUSTAINABILITY INITIATIVES

OUTLOOK

For the business year 2024, Valamar Group expects to generate consolidated operating revenues ranging between EUR 411 million to EUR 415 million (EUR 372 million in 2023), with expected growth ranging between 10.4% and 11.5%.

For the business year 2024, expected adjusted EBITDA of Valamar Group will range from EUR 117 million to EUR 120 million (EUR 109 million in 2023), representing an increase of 6.9% to 9.7%.

Results of the Group	6
Results of the Company	16
Investment cycle 2023/24	18
ESG & Human resources	22
The Risks of the Company and the Group	29
Corporate Governance	35
Related-party Transactions and Subsidiaries	38
Valamar Share	40
Additional Information	44
Disclaimer	46
Responsibility for the Quarterly Financial Statements	48
Financial Statements According to TFI-POD	49

Results of the Group

Q UA R T E R LY F I N A N C I A L S TAT E M E N TS

The Management Board hereby presents the unaudited quarterly financial statements for the third quarter and the first nine months of the year 2024.

The Group's profit and loss account for the period considered consolidates the data from the following companies: Valamar Riviera d.d. (Parent Company), Imperial Riviera d.d. (a subsidiary 46.27% owned by Valamar Riviera d.d. with its subsidiary Praona d.o.o., Makarska), Magične stijene d.o.o.* (100% owned until 3 August 2023) and Bugenvilia d.o.o. (100% owned).

The investments in the company Helios Faros d.d. (20% owned) and Valamar A GmbH (24,54% owned) are reported according to the equity method since Valamar Riviera d.d. does not exercise control but a significant influence over them.

* The company was deleted from the court register on 3 August 2023 based on the procedure for termination of the company by abbreviated procedure without liquidation.

The Management Board presents the quarterly financial statements for the third quarter and the first nine months of 2024

Krk Premium Camping Resort 4*, Krk island

KEY FINANCIAL INDICATORS1

(IN EUR)	1 - 9/2023	1 - 9/2024	2024/2023
Total revenues	350.124.608	392.396.825	12,1%
Operating income	347.824.634	390.104.554	12,2%
Sales revenues	345.872.649	385.986.878	11,6%
Board revenues (accommodation and board revenues)2	290.261.560	322.915.567	11,2%
Operating costs3	205.564.601	239.056.803	16,3%
EBITDA4	140.213.061	147.111.830	4,9%
Extraordinary operations result and one-off items5	963.833	599.781	-37,8%
Adjusted EBITDA6	141.176.894	147.711.611	4,6%
EBIT	91.202.112	95.110.706	4,3%
Adjusted EBIT6	90.238.279	94.510.925	4,7%
EBT	85.868.296	84.707.962	-1,4%
EBITDA margin	40,3%	37,7%	-2,6pp
Adjusted EBITDA margin	40,6%	37,9%	-2,7pp

	31/12/2023	30/9/2024	2024/2023
Net debt7	217.762.850	253.576.810	16,4%
Net debt (liabilities for tourist land under IFRS 16 excluded)	217.762.850	189.454.093	-13,0%
Cash and cash equivalents	55.185.359	50.546.566	-8,4%
Market capitalization8	594.849.998	630.137.710	5,9%
EV9	951.166.260	1.029.050.727	8,2%
Share price	4,72	5,00	5,9%
EPS9 (for the first nine months)	0,53	0,49	-7,5%

KEY BUSINESS INDICATORS10

	1 - 9/2023	1 - 9/2024	2024/2023
Number of accommodation units (capacity)	20.087	19.956	-0,7%
Number of beds	56.354	56.477	0,2%
Accommodation units sold	2.401.516	2.324.349	-3,2%
Overnights	6.156.346	6.015.048	-2,3%
ARR11 (in EUR)	121	138	14,4%
RevPAR (in EUR)	14.450	16.106	11,5%
EBITDA PAR (in EUR)	7.105	7.491	5,4%

1 Classified according to the Annual Financial Statement (GFI POD-RDG). EBIT, EBITDA and their adjusted values and respective margins are recorded on the basis of operating income.
2 In compliance with the classification under the USALI international standard for reporting in hotel industry (Uniform System of Accounts for the Lodging Industry). Non-commercial properties/data excluded.
3 Operating costs include material costs, staff costs, other costs, and other operating costs reduced by extraordinary expenses and one-off items.
4 EBITDA (eng. earnings before interest, taxes, depreciation and amortization) is calculated as: operating income - total operating costs + depreciation and amortisation + value adjustments.
5 Adjustments were made for (i) extraordinary income (in the amount of EUR 3.1mn in first nine monhts of 2024, and EUR 1.0mn in first nine monhts of 2023), (ii) extraordinary expenses (in the amount of EUR 3.5 in 2024, and EUR 1.8mn in 2023), and (iii) termination benefit costs (in the amount of EUR 0.2mn in 2024, and EUR 0.1mn in 2023).
6 Adjusted by the result of extraordinary operations and one-off items.
7 Net debt: non-current and current liabilities to banks and other financial institutions + liabilities for loans, deposits and other + other liabilities according to IFRS 16 (leases) – cash and cash equivalents – long-term and short-term investments in securities – current loans given, deposits, etc.
8 Market capitalization is calculated as the total number of shares multiplied by the last share price on last day of the period
9 EV refers to enterprise value; calculated as market capitalization + net debt + minority interest. EPS - earnings per share.
10 Data for Helios Faros and Valamar A GmbH are not included. Noncommercial properties/data excluded.
11 Average rate is recorded on the basis of cumulative board revenues (accommodation and board's food and beverage revenues).

Noćenja i ARR

Revenues and accommodation units sold

Valamar Group's operating revenues for the first nine months of 2024 amount to EUR 390,1 million. That's 12.2% more than last year and in line with the budget. Business growth was fuelled by strong demand from key markets and previous multi-year investments in portfolio development, sales, marketing, and operational excellence. Consequently, premium segment hotels and camping resorts recorded the best results.

All Valamar's destinations have shown very good performance, with Dubrovnik leading the way. The business volume in Dubrovnik has fully rebounded to pre-pandemic levels, both financially and in number of overnights.

REVENUES

In the first nine months of 2024, total revenues amounted to EUR 392.4 million, which represents an increase of 12.1% (EUR 42.3 million). Total generated revenues have been influenced by:

a) growth in sales revenue by 11.6% (EUR 40.1 million) to the amount of EUR 386.0 million, primarily consists of board revenue (EUR 322.9 million). There was a slight change in the revenue structure: domestic sales amounted to EUR 43.1 million with a share of 11.2% in sales revenue (10.1% in the first nine months of 2023), and compared to 2023, are higher by EUR 8.0 million. With a share of 88.8% in sales revenues (89.9% in the first nine months of 2023), sales on foreign markets amount to EUR 342.8 million and are higher by EUR 32.1 million.

b) increase in other operating revenue by EUR 2.2 million to 4.1 million euros, mainly due to recognized revenue related to court disputes and revenue from previous periods

c) financial income amounts to EUR 2.3 million and is almost at the same level as last year (-0.3%).

TOTAL OPERATING EXPENSES OF VALAMAR GROUP12

(in EUR)	1-9/2023	1-9/2024	24/23
Operating costs13	205.564.601	239.056.803	16,3%
Total operating expenses	256.622.522	294.993.848	15,0%
Material costs	97.648.430	108.853.514	11,5%
Staff cost	82.323.326	95.016.268	15,4%
Depreciation and amortisation	49.010.949	52.001.124	6,1%
Other costs	25.631.875	35.215.927	37,4%
Provisions and value adjustments	4.485	1.286	-71,3%
Other operating expenses	2.003.457	3.905.729	94,9%

TOTAL OPERATING EXPENSES

In the first nine months of 2024, after two regulations defining the prices and the legal framework relating to tourist land were adopted in February 2024, Valamar Group did the following:

assessed the value of the right-of-use assets and liabilities according to IFRS 16 as of 1 January 2024 in the amount of EUR 63 million for the Group (EUR 58 million for the Company) and booked the expenses on that basis as follows:
depreciation amounting to EUR 1,022 thousand for the Group (EUR 945 thousand for the Company)
interest rate amounting to EUR 2,643 thousand for the Group (EUR 2,356 thousand for the Company)
concerning the variable part of the lease (which is not capitalized but expensed in the profit and loss account), the Group booked the lease costs of EUR 582 thousand for the Group (EUR 582 thousand for the Company) under item Other External Costs within Material Costs.

In the first nine months of 2023, the Group did not book any costs relating to tourist land.

Total operating expenses amount to EUR 295,0 million and are 15.0% higher than last year. The development of operating expenses is as follows:

a) material costs amount to EUR 108.9 million and are higher by 11.5% mainly as a result of increased costs of raw materials, costs of goods sold, maintenance, cleaning, consumables, costs of promotional activities and marketing and costs of lease of tourist land

A new electricity supply contract for the period from 1 June 2024 to 31 December 2024 has been signed with a lower price compared to the comparable period last year.

b) personnel costs increased by 15.4% and amount to EUR 95.0 million, after a higher average number of employees and additional and increased employee salaries and benefits

c) depreciation amounts to EUR 52.0 million, which represents an increase of 6.1%, mostly due to increased capital investments in 2023 and depreciation related to tourist land

d) other expenses increased by 37.4% to EUR 35.2 million. The increase is mainly due to increased costs for food, accommodation and education of employees, staffing agency fees, travel expenses, preparation of new projects and utility fees

e) other operating expenses amount to EUR 3.9 million, which is an increase of EUR 1.9 million, mostly due to the recognition of costs from previous periods and cost of EUR 1.6 million for the principal amount related to lost legal dispute (described in more detail in the chapter Business risks on page 33).

¹² Classified according to Annual Financial Statements standard (GFI POD-RDG).

¹³ Operating costs include material costs, staff costs, other costs, and other operating costs reduced by extraordinary expenses and one-off items.

EBITDA AND PROFIT FOR THE PERIOD

Operating revenues in the first nine months of 2024 amount to EUR 390.1 million and are higher by 12.2% compared to the same period in 2023. Operating expenses increased by 16% to EUR 239.1 million. This was primarily due to continued strong spending in employee payroll and compensation (labour costs increased by EUR 17.8 million or nearly 18%). Operating profit (adjusted EBITDA) reached EUR 147.7 million, 4.6% higher than in the same period in 2023, with EBITDA margin down by 2.7 percentage points. Unfavourable weather conditions in September posed an impact on lower than planned revenues in post-season, together with increased costs related to tourist land and maritime property concession. Net profit was additionally hindered by EUR 4,6 million in extraordinary costs for legal cases and settlements as well as 3 million increase in depreciation, with Net profit down by EUR 3,4 million. Given the expected cost development and their dynamics in the last quarter of 2024, the Group expects to slightly improve in earnings margin by the end of the year.

Following 6.1% higher depreciation costs, slightly weaker net financial result (explained in more detail in the next chapter) and one-off costs related to court proceedings, earnings before tax (EBT) amounts to EUR 84.7 million, which is EUR 1.2 million lower than last year.

The Group estimated its tax expenditure at EUR 12.4 million, which is mostly the result of current tax. Given the seasonality of the business and the fact that it can be expected that the fourth quarter usually brings a net loss, the Company/ Group estimates that the whole of 2024 will see the realisation of a lower net profit before tax and, consequently, a lower income tax. Net profit for the first nine months of 2024 amounts to EUR 72.4 million.

RESULT FROM FINANCIAL AC TIVITIES

The net financial result for the first nine months of 2024 amounts to EUR -10.4 million, which is EUR 5.1 million lower compared to the same period in 2023, when it amounted to EUR -5.3 million.

The deterioration of the net financial result was mostly influenced by the growth of interest expenses by EUR 4.6 million compared to the same period in 2023, as a result of statutory default interest for lost court cases in the amount of EUR 2.4 million, and interest expenses under the liability item for IFRS 16 Rent of tourist land of EUR 2.6 million, which is included in the balance sheet of the Company and the Group as of 1 January 2024 (explained in the chapter Total operating expenses).

Unrealized gains (income) from financial assets are lower by EUR 0.2 million compared to the same period last year, due to the amortization of interest rate swaps in the third quarter. The higher level of interest rates on deposits resulted in EUR 0.1 million higher other revenue from interest.

1-9/ 2023 1-9/2024

Financial income and expenses

14 Net debt (liabilities for tourist land under IFRS 16 excluded): non-current and current liabilities to banks and other financial institutions + liabilities for loans, deposits and other + other liabilities according to IFRS 16 (leases) – cash and cash equivalents – long-term and short-term investments in securities – current loans given, deposits, etc.

Net debt 14

ASSETS AND LIABILITIES

As at 30 September 2024, the total value of the Group's assets amount to EUR 952.5 million, which is 15.3% higher than on 31 December 2023. Total share capital and reserves amount to EUR 488.3 million and are higher by 9.3% as a result of the generated net profit for the period and dividend paid.

As explained in the chapter Total operating expenses, Valamar Group carried out an assessment of the value of assets and liabilities with the right of use in accordance with IFRS 16 on 1 January 2024 in the amount of EUR 63 million. By this, the balance sheet of the Group increased by the stated amount: assets in the position Land (within Tangible assets) and liabilities in the position Other long-term liabilities and Other short-term liabilities.

Total long-term and short-term liabilities to banks and other financial institutions on 30 September 2024. amount to EUR 273.9 million and are 6.8% lower than on 31 December 2023 as a result of loan repayment.

Almost entire loan portfolio consists of long-term loans with an agreed fixed interest rate or loans protected by derivative instruments (IRS) for the purpose of protection against interest rate risk. This largely eliminated the interest rate risk. Additionally, most of the Group's cash receipts are in EUR, as is the entire credit portfolio, which largely eliminates currency risk.

Assets and liabilities

On 30 September 2024 the Group's cash balance amounts to EUR 50.5 million, which represents a decrease of 8.4% compared to 31 December 2023. after repayment of loans, investments in long-term assets and paid dividends. High cash balance of the Group together with i) the contracted credit lines, ii) valuable tourism assets and iii) a strong operational business model made the Group's balance sheet position stable.

BUSINESS RESULTS 1/1/2024 - 30/9/2024

HOTEL AND CAMPING RESORTS OVERVIEW*

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* owned and under management

Results of the Company

In the first nine months of 2024, total revenues amount to EUR 305.4 million, which is an increase of 9.2% or EUR 25.7 million, compared to the same period in 2023, when they amounted to EUR 279.7 million. Sales revenues amount to 296.1 million euros and are higher by 8.3% compared to the same period last year.

Material costs amount to EUR 87.6 million, with a growth of 12.4% due to increased costs of raw materials, costs of goods sold, maintenance, cleaning, consumables, costs of promotional activities and marketing, and costs of rent for tourist land.

SALES REVENUE INCREASED BY 8% TO EUR 296 MILLION

Personnel costs amount to EUR 74.4 million and are 14.3% higher compared to last year, after a higher average number of employees and increased salaries and rewards for employees. Depreciation amounts to EUR 36.9 million and is higher by 4.2% compared to last year, mostly due to increased capital investments in 2023 and depreciation related to tourist land (explained in the chapter Group's operating expenses). In the first nine months of 2024, the net financial result amounts to EUR -2.3 million (EUR -0.3 million in the same period in 2023). The lower net financial result was mostly influenced by the increase in interest expenses of EUR 4.4 million, mostly as a result of the interest expense under the liability item for IFRS 16 Rental of tourist land of EUR 2.4 million and statutory default interest for lost court disputes in the amount of EUR 2 .4 million. On the other hand, the largest positive effect comes from the dividend received from Imperial Riviera d.d. (EUR 2.8 million).

In the first nine months of 2024, EBITDA of EUR 105.9 million was realized, which represents a decrease of 3.1% compared to the EBITDA realized in the first nine months of 2023 in the amount of EUR 109.2 million. This is primarily the result of the previously mentioned increased spending in employees and the growth of other cost categories.

After 4.2% higher depreciation, somewhat lower net financial result and one-off costs related to court proceedings, earnings before tax (EBT) amount to EUR 66.6 million, which is 9.4% less than last year.

The Company estimated its tax expenditure at EUR 12 million, which is mostly the result of current tax. Given the seasonality of the business and the fact that it can be expected that the fourth quarter usually brings a net loss, the Company estimates that the whole of 2024 will see the realisation of a lower net profit before tax and, consequently, a lower income tax. Net profit for the period amounts to EUR 54.6 million.

The total value of the Company's assets on 30 September 2024 amounts to EUR 753.5 million, which is 14.1% higher than on 31 December 2023. The total share capital and reserves amount to EUR 437.0 million, which is 7.2% higher primarily as a result of the realized net profit of the period.

Investment cycle 2023/24

Valamar Riviera's continued success and growth is a result of investing in products, employees and tourist destinations, always ensuring sustainable and socially responsible development through Valamar's commitment to reducing its carbon footprint and constant investment in renewable energy sources. Along with enhancing our tourist offering, we have also been developing Valamar's service concepts to meet the current market demands and guest expectations. The planned portfolio repositioning and development toward high added-value offerings and services, with emphasis on the premium resorts and campsites segment, while preparing for the new future growth and development projects. Following the harmonisation of our planned portfolio and development with the tourist flows and a proactive approach to cash flow management and financing, we have focused the implementation of our investments in the 2023/2024 cycle mostly on realising new investments aimed at boosting our quality level and guest satisfaction.

The total of the approved investments for the 2023/2024 investment cycle at the Valamar Group level amounts to EUR 84 million. Investments are mainly directed towards renovating accommodation units in hotels and campsites. Apart from that, Valamar is also actively investing in environmental protection and energy efficiency, safety and digitalisation, and innovation for a new period of growth.

VALAMAR RIVIERA

Valamar Riviera d.d. is ending its 2023/2024 investment cycle worth EUR 45,7 million. The realised investments aim to improve business processes, enhance operations, raise the quality of facilities and services, and increase energy efficiency and digitalisation. The largest single capital investment in 2023/2024 amounts to EUR 9.6 million was made in the renovation of 180 accommodation units at Allegro Sunny Hotel 3* in Rabac and 90 of the total 120 accommodation units at Miramar Sunny Hotel 3* in Rabac, while the remaining 30 accommodation units were renovated in 2021.

The merger of these two hotels created a new Sunny brand product called Rabac Sunny Hotel & Residence 3*. In addition to room renovations, investments in children's facilities in both hotels were made, Allegro playroom was added, and, at Miramar Hotel, a part of the Lounge Zone was repurposed into the Play Zone. A new sundeck and a pool were constructed, an outdoor trampoline park was added and the capacity of the restaurant for hotel guests was increased by adding an outdoor terrace and expanding the indoor restaurant area with an additional 80 seats. The F&B concept offers Sunny Breakfast & Brunch and Sunny Dinner services. This unique Sunny brand product provides accommodation in a fantastic location and is focused primarily on families.

Another significant investment of EUR 6 million pertains to reconstructing accommodation units at Koralj Sunny Hotel 3* on the island of Krk and installing children's facilities. This investment was used to finalise a complete renovation and redesign of 194 accommodation units and increase the hotel's bed capacity by 120, whereby the hotel's capacity increased from 429 to 549 beds. New children's facilities on the ground floor were implemented, including a new children's playroom, a Multimedia Game Lounge, a Family Lounge, Maro Smart Play Rooms and an upgrade of the Chill and Play Zone.

With respect to Isabella Valamar Collection Island Resort 4*/5* Hotel in Poreč, the level of its Oliva Grill restaurant was upgraded, including an expansion of the outdoor terrace and kitchen, and a children's playground was added. Valamar Argosy Hotel 4* in Dubrovnik saw the covering of its Mezzino Pool Bar with a roof.

In addition to investing in hotels, Valamar actively invests in its campsites. Given the growing demand for camping tourism, more than EUR 2.4 million were invested in this investment cycle precisely in expanding and enhancing the standard of our campsites and their facilities. At our Lanterna Premium Camping Resort 4* in Poreč, two supermarkets were reconstructed, along with two sanitary blocks. Quality improvement of the 24 existing Standard pitches in Zones A and C into new 25 Comfort pitches was made as well as quality improvement of 2 pitches in Zone K from Comfort Mare to Premium Mare. 12 new Premium mobile homes with terraces were set up at Marina Camping Resort 4* in Rabac, 7 new mobile homes were set up in Zone B at Baška Beach Camping Resort 4* on the island of Krk, and 20 pitches for mobile homes and 5 Mega Comfort pitches were built at Solaris Camping Resort 3* in Poreč. Apart from that, quality enhancement of 15 existing pitches in Zone A to Mega Comfort pitches was made at Orsera Camping Resort 3* in Poreč, as well as of 10 pitches in Zones A and B at Istra Premium Camping Resort 5* in Poreč and of 7 Comfort pitches to Premium Mare pitches in Zone F at Škrila Sunny Camping 3* on the island of Krk.

Valamar Riviera is committed to sustainable and socially responsible business practices. Therefore, we invested more than EUR 1.2 million in various energy efficiency projects and EUR 3.5 million in sustainability projects by purchasing electric vehicles, planting trees, preventing the emergence of bio-waste and other initiatives. Notable investments include the continuation of the 'Eco Corners' project at Lanterna campsite and the bio-waste projects at Lanterna apartments, Diamant Hotel and President Hotel in Dubrovnik. Also, new heat pumps were installed at hotels Sanfior and Girandella.

In addition to environmental protection and energy efficiency, we pay particular attention to the investment maintenance of all our destinations by investing in the regular maintenance of properties and facilities for the safety of our guests. In the 2023/2024 investment cycle, we invested about EUR 11.7 million. Notable investments included the reconstruction of two sanitary blocks at Lanterna campsite and the construction of the Maro playground. At Tamaris hotel, the reconstruction of bathrooms in 27 villas was done, while the reconstruction in the remaining 27 villas is expected to be finalised in autumn. The refurbishment of the terrace and halls was done at Casa Agava. Hotel accommodation units were refurbished, and a part of the sundeck in the pool area was revamped. The total value of the works at Tarmaris Hotel and villas amounts to more than one million euros. The terraces of the Spinnaker restaurant in Poreč and Miramare restaurant on Isabella Island were reconstructed, and Piazza at Baška Beach campsite was arranged as well. We also place great importance on investing in accommodation for our seasonal workers. In the destination of Dubrovnik, the third phase of accommodation refurbishment was completed, which included interior decoration and furnishing of an additional 36 rooms (72 beds) valued at EUR 925 thousand. The interior decoration and furnishing of the Lanterna and Diamant apartments was finalised, with an investment of EUR 390 thousand. We are investing about 600 thousand euros in the purchase of furniture and equipment, with an additional 615 thousand euros in an upgrade of beaches and over 715 thousand in safety improvements.

With the development of digitalisation, we have been making continuous efforts to enhance our service quality. For this reason, in this investment cycle, we are investing over EUR 5.9 million in digitalisation and innovation projects, with the largest allocation being earmarked for the development of the Valamar. com website. In addition to investments in digitalisation, an additional EUR 1.8

IN 2023/24 CYCLE. VALAMAR RIVIERA'S INVESTMENTS WERE PLANNED IN THE AMOUNT OF 44.1 MILLION, AND IMPERIAL RIVIERA'S 38.4 MILLION

million are being invested in IT maintenance projects, and more than 200 thousand euros in branding and signage.

On top of above investments, an investment in the Pical project with a total investment value of EUR 139 million is planned this and next year. The Pical project is the largest single investment in Croatian tourism, which will offer top-quality tourism services all year round. A contract between the investor Valamar Riviera d.d. and the contractor Kamgrad d.o.o. to continue the construction of the Pical resort was officially signed in Poreč, on 14 March 2024. The value of the contract is EUR 81.7 million, with the total investment valued at EUR 139 million. The planned completion date for all is December 2025. In addition to the reconstruction of this hotel, a plan of investing in beaches in the upcoming period 2024 – 2026 is also being prepared.

Hotel Pical 5* will feature 513 accommodation units, 10 themed restaurants and bars, a wellness centre, landscaped beaches and beach clubs, outdoor and indoor pools and facilities for various types of vacation. For families, Pical will offer the educational Maro World playroom spanning more than 1,200 m2, Maro clubs, children's playgrounds and an entertainment programme tailored for families. There will also be a range of facilities for an active vacation, such as the new Bike Centre Parenzana, outdoor running trails, water sports and an indoor 25m swimming pool. Pical Beach, all sports and entertainment facilities, indoor pool, promenades and other recreational facilities will be open to the public and available for the use of our guests and visitors as well as the local community. The Pical Zone will become the most attractive tourist zone in Croatia and will showcase one of the best congress centres with a multifunctional hall capable of accommodating up to 1,200 participants.

IMPERIAL RIVIERA

Imperial Riviera d.d. continues its 2023/2024 investment cycle worth EUR 38.4 million with the key objective being a further improvement of the company's offerings in all of its destinations.

The most significant investments are focused on repositioning and improving service quality, digitalisation, green building, sustainable energy sources and tourism infrastructure in all destinations. They primarily relate to the first phase of the reconstruction of the existing tourist resort Suha Punta (Arba Resort 4*/5* Valamar Collection at Capo Fronte in the destination of Rab). This project is foreseen to be carried out in several phases and is aimed at firmly positioning this destination among the top family vacation destinations on the Adriatic. In early March, a contract was signed with the main contractor, the construction company Radnik d.d., for building the tourist resort Arba Resort 4*/5* at Capo Fronte in Suha Punta on Rab. Excavation works for pools have finished, and concrete, insulation and installation works are almost finished. The works in the hotel building are continuing and have entered an advanced stage of execution. Landscaping and infrastructure works have also begun.

The first phase of the renovation of the existing complex of Rivijera Sunny Resort by Valamar 2* (Makarska Sunny Resort 3*) in the destination of Makarska was completed, where this complex was repositioned under the Sunny brand, which has been already recognised by the market as a brand offering economical and simple vacation with excellent service quality and the best value for money. Additionally, the Bike Centre Poreč within Valamar Parentino Hotel 4* was finalised, and preparatory works for the installation of solar power plants on the roof of the Bike Centre and the hotel are currently in the phase of design. Investments in the destination of Rab aimed at enhancing the offering of Imperial Valamar Collection Hotel 4*, along with the renovation of the new Brdo Zone at Padova Premium Camping Resort 4* were finished. The additional refurbishment of Valamar Padova 4* Hotel was also completed. In the destination of Dubrovnik, investments to enhance the offering of Valamar Lacroma 4* Hotel were finished along with the works carried out in a part of Solitudo Sunny Camping 3*.

The company continues to intensively work on the preparation of project and zoning documentation for investments in the destination of Rab concerning the beaches of Val Sandy Beach within the Arba Resort, San Marino Sunny Resort by Valamar 3* and San Marino Premium Camping Resort by Valamar 4*.

ESG & Human resources

SUSTAINABILITY

Throughout 2024, Valamar continued to invest in strategic ESG projects and initiatives. Investments were directed towards reducing the Company's carbon footprint through decarbonisation efforts, for which this year an investment of approximately EUR 2 million was planned for investments in renewable energy sources – particularly solar energy – and the deployment of electric vehicles. Within its sustainability programme, partnerships with a large number of local family farms have been realised. In 2024, Valamar's funds allocated towards employee development and reward programmes, encompassing various educational, developmental, and housing incentive initiatives at its destinations, will amount to around EUR 20 million. Investments in all destinations have also channelled into enhancing tourism infrastructure such as promenades, bike paths, playgrounds, and beaches, alongside support for destination events, community outreach, and local CSR organizations. Valamar, joined global initiatives for sustainable development, i.e. Science Based Targets initiative and the UN Global Compact, and its active participation was confirmed beginning of July 2024 by filling in the CoP (Communication on Progress) questionnaire. By partnering with the UN Global Compact, Valamar has committed to conducting business in accordance with its Ten Principles, which emphasise human rights, labour standards, environmental protection, and anticorruption measures. By its membership in the Science Based Targets initiative, Valamar, as do other world climate leaders, continues to undertake concrete steps which are evident in the reduced emissions towards achieving decarbonisation from scope 1 and 2. In the period between 2015 and 2023, Valamar reduced greenhouse gas emissions by 72% per occupied accommodation unit, achieved waste reduction per overnight and waste separation of as much as 53%, and implemented photovoltaic power plants in hotels and campsites to cover 6% of its electricity needs.

Valamar was awarded a Certificate of Appreciation by Istria County for its exceptional contribution to the tourism industry in Istria County during Valamar's 70 years of operation Valamar Riviera has significantly shaped the development of tourism and has become a leader of economic and social development in the most successful tourist destinations in Croatia.

CONTINUED STRONG INVESTMENTS IN STRATEGIC PROJECTS AND SUSTAINABILITY INITIATIVES

SINGLE-USE PLASTIC IN HOTELS AND CAMPSITES ALMOST COMPLETELY REMOVED

ESG STRATEGY

At the beginning of 2024, Valamar adopted a new strategy for sustainable business development until 2026, which was presented as part of the integrated report for 2023. The sustainability strategy covers 12 key objectives in the field of environment (E), society (S) and governance (G). Valamar is the first tourism company in Croatia to integrate sustainable development into business and development management and to announce sustainability goals according to the ESG framework.

ESG PROJECTS AND ACHIEVEMENTS

Environment

Reducing greenhouse gas emissions stands as one of the 12 Environmental, Social, and Governance (ESG) targets outlined in the ESG strategy. Valamar reduces its carbon footprint by transitioning from fossil fuels to electricity sourced from renewable channels, by deploying heat pumps and other energy efficiency measures. In collaboration with E.ON, Valamar has successfully installed photovoltaic power plants at its tourist facilities, covering 6% of our total electricity demand. In 2024, our focus persists on upgrading to LED lighting, integrating electric vehicles, furthering decarbonisation efforts, and ensuring that 100% of our electricity derives from renewable sources. Measurement of scope 3 emissions continue, with defined actions set to achieve scope 1 and 2 decarbonisation targets by 2026. Valfresco Direkt platform –is an online web shop for showcasing products from local family farms, wineries, olive orchards, and other domestic producers at one place and it continues to cooperate with several dozen family farms.

Efforts to minimise waste generation and promote responsible disposal practices remain a priority. With additional investments in our own biocomposting facilities, we've scaled up biocompost production to 347 tons in 2023, maintaining this momentum. Notably, we have almost completely eliminated single-use plastics across our hotels and campsites. Cosmetic amenities are provided in eco-conscious packaging, made from natural or biodegradable materials such as wood, bamboo, and cotton. Digital menus have replaced paper counterparts, while environmentally friendly alternatives have supplanted plastic straws since 2018. Ongoing communication with guests, employees, and suppliers underscores our commitment to effective waste management.

MONITORING 12 ESG GOALS

	GOAL	KPI	STRATEGIC INITIATIVE	unit	2022	2023	2024	GOAL 2026	2026 TRACK	PROGRESS
ENVIRONMENT
1	DECARBONIZATION SCOPE 1 AND 2	REDUCTION OF EMISSION IN SCOPE 1 AND 2 BY 75%	PROTECT THE CLIMATE	KG CO2E/OCC. ROOM	3.1	2.8	2.5	2.1	•	Full use of renewable electricity. In 2024, the plans to reduce CO2 emissions were aligned with the SBTi initiative.
2	15% OF SOLAR ELECTRICITY	PRODUCED OWN ELECTRIC ENERGY FROM RENEWABLE SOURCES		% OF TOTAL	6%	6%	6%	15%	•	New solar panels planned for 2025/2026 will enable achieving 10% of total energy.
3	HIGHEST SEA QUALITY	ADRIATIC SEA QUALITY IN OUR DESTINATIONS (EEA)	TAKE CARE OF THE ADRIATIC, BIODIVERSITY AND FOOD	%	100%	95%	> 95%	> 95%	•	Measures to protect the Adriatic and its biodiversity, continuation of cleaning measures.
4	REFORESTATION AND 80,000 TREES PROGRAM	MANAGED TREEES	PROTECT THE CLIMATE	#	79,229	80,261 81,144		> 80,000	•	883 will be planted within the Valamar 80,000 trees program.
5	WASTE RECYCLING RATE HIGHER THAN EU AVERAGE	REDIRECTED WASTE RATE		[%]	46.30%		53,10% > EU avg > EU	avg	•	Additional biocomposters were installed at new properties, a total of 347 t of biowaste was produced. Various activities to increase waste separation are planned.
6	LOW WATER WITHDRAWAL INTENSITY (0.55 M3/OCC. ROOM)	WATER WITHDRAWAL INTENSITY	ENSURE RESPONSIBLE WATER AND WASTE MANAGEMENT	[M2 /OCC. ROOM	0.55	0.55	0.55	0.55	•	Continued optimization of water consumption - additional education for employees and more control over loss in the water supply system.
7	REMOVING SINGLE-USE PLASTIC	SINGLE-USE PLASTIC USAGE		[KG / OCC. ROOM]	0.07	0.06	0.05	0	•	Continuation of single use plastic items replacement in operations.
SOCIETY
8	SHARE OF DOMESTIC EMPLOYEES 70%	DOMESTIC EMPLOYEES	EMPOWER EMPLOYEES	[%]	87%	83%	77%	70%	•	Ongoing program to attract and retain domestic employees.
9	SHARE OF LOCAL FOOD 80%	SHARE OF LOCAL FOOD AND BEVERAGES	DEVELOP DESTINATIONS	[%]	78%	78%	79%	80%	•	Local family farms and active cooperation in the field of ESG with suppliers.
10	ESG INVESTMENTS WORTH EUR 50 MILLION	TOTAL ESG INVESTMENTS	DEVELOP DESTINATIONS	[€M]	13.1	13.4	14	15	•	We continue to invest in tourism infrastructure, employee education and local communities
GOVERNANCE
11	SHARE OF RESPONSIBLE SUPPLIERS 80%	VALUE SHARE OF RESPONSIBLE SUPPLIERS	IMPLEMENT RESPONSIBLE	% OF SUPPLY VALUE	-	20%	40%	80%	•	Engagements with suppliers; sustainability clause and the Supplier Code of Conduct was introduced in contracts; the project of sustainable sea products with WWF continues.
12	100% OF PROPERTIES WITH SUSTAINABILITY CERTIFICATES	SUSTAINABILITY CERTIFICATES	GOVERNANCE	% OF ASSETS	100%	100%	100%	100%	•	Continue sustainability certifications.

Valamar oversees the care of over 80,000 trees within its'Easy as One, Two, Tree' donation campaign, whereby the guests of Valamar's hotels and campsites donate for the forestation of Croatia. Thanks to an excellent response of our guests, Valamar will thus plantover 10,000 trees this year Collaborating with BioM, we've installed 250 bird nesting houses, alongside 70 insect hotels, 90 bat houses, and 30 hedgehog dwellings across our properties, totalling more than 400 habitats.

At Padova Premium Camping Resort 4* on the island of Rab, 33 new energy-efficient mobile homes –camping homes and chalets Hilltop Green – have been set up. These modular properties have been designed and constructed following the highest green building standards with the use of wood as the most sustainable building material. All lighting, household appliances and electronic devices are of a high energy efficiency standard, and the outlet openings for water have been equipped with systems to reduce water consumption.

The Croatian Green Building Council and the Croatian Association of Thermal Facade System Manufacturers have named Valamar the 'Organisation of the Year' at the Annual Green Building and Sustainable Built Environment Awards 2023, held in Zagreb.

The Croatian Green Building Council is a member of the World Green Building Council and the European Network of Green Building Councils, and since 2016, it has been awarding Annual Green Building and Sustainable Built Environment Awards. The goal of the award is to elevate the reputation of the profession, promote excellence in the field of green building and sustainable built environments, and contribute to environmental preservation and sustainable development in the Republic of Croatia.

Valamar and WWF Adria, the regional branch of the World Wide Fund for Nature, presented the achievements of their joint initiative for preserving the Adriatic Sea and promoting sustainable fishing, which began in 2023. This cooperation between Valamar and WWF Adria is the first of its kind in the tourism sector in Croatia. In line with WWF Adria's recommendations, Valamar has completely excluded endangered species such as sharks, rays and swordfish from its offer. Significant cooperation has been achieved with the local fishing cooperative from Komiža, which has thus attracted young new fishermen and ensured the long-term sustainability of its business. Thanks to this cooperation, Valamar covers as much as 20% of its hake assortment from this source. This example of good practice initiated by Valamar with WWF Adria represents an excellent direction towards preserving the health of ecosystems and reducing environmental impact as a prerequisite for long-term sustainability. VALAMAR WAS AWARDED NUMEROUS RECOGNITIONS FOR ENVIRONMENTAL PROTECTION AND ENERGY TRANSITION

Society

As the leading investor in Croatian tourism, Valamar has invested more than EUR one billion million into the sector over the past two decades, repositioning the portfolio towards high-quality with added value. Over the last seven years, Valamar has been recognised as the best employer in Croatian tourism. Socially responsible investments, comprising 3-5% of annual revenue, are prioritised for employee development, student scholarships, and investments in tourism infrastructure such as promenades, bike paths, playgrounds, and beaches. Additionally, support for cultural and sporting events in destinations, alongside numerous community initiatives, underscore Valamar's commitment to enhancing local quality of life. The Company's dedication to environmental protection and energy transition has earned it accolades at the European level, positioning it as a prominent leader in sustainable tourism practices.

In 2024, Valamar continues its substantial investment in its workforce, exemplified by an agreement with social partners to increase basic salaries for over 5,000 employees. Professional positions can expect remunerations ranging between EUR 1,400 and 2,000 net during high season. Furthermore, Valamar plans to create an additional 400 permanent job opportunities this year. Through the 'Live the Destination' initiative, employees residing in destination areas or opting for permanent relocation stand to benefit from an extra EUR 400 net, incentivising year-round employment and local engagement.

THE 'BIKE CENTRE POREČ', THE LARGEST CYCLING CENTRE IN CROATIA, HAS OPENED IN POREČ Valamar has again been named the most desirable employer in tourism and is still the only tourism company on the list of the 20 best Croatian employers – according to the latest research conducted by Alma Career Croatia, which manages the MojPosao portal..

In March 2024, Valamar again hosted the esteemed Istarska Rivijera, Croatia's oldest international tennis tournament, reaffirming its dedication to fostering sports development and promotion within the communities it operates in. Valamar remains committed to ongoing investments in infrastructure and sports facilities, ensuring that its destinations remain highly desirable for sports and leisure enthusiasts alike.

In June 2024, Valamar hosted the WTA Makarska Open hosted by Valamar tennis tournament for the third time. This tournament took place at Valamar's tennis centre in the very heart of Makarska and participants were accomodated at Dalmacija PLACES Hotel. This year's tournament was the 18th tournament in a row and it was held in Makarska for the third time. The tournament is very important for its organisers and the local community alike. Namely, seven top Croatian female tennis players as well as numerous female tennis players from the top 100 participated in this year's event, which greatly contributes to the promotion of Makarska as a tourist sporting destination. Valamar takes special care about continuing to promote tourist infrastructure accessible to all as well as to improving the quality of life in the communities in which it operates.

At the natural scenic viewpoint within Bike Park Rabac, Valamar set up a resting area for cyclists and nature lovers. By refurbishing this resting point for cyclists and nature lovers who engage in outdoor activities, Valamar has additionally enhanced the offer of Bike Park Rabac enabling visitors to have a break and take a photo of the beautiful landscape. By building the bile centre Rabac, Valamar has enabled its guests and the local community to make use of a unique centre offering services and facilities to all types of cyclists.

The 'Bike Centre Poreč', the largest cycling centre in Croatia, has opened in Poreč, located at the start of the well-known Parenzana cycling trail near Valamar Parentino 4* Hotel. The project is implemented with the help of EU grants awarded to Imperial Riviera under the National Recovery and Resilience Plan. The Bike Centre Poreč will significantly contribute to the development of sustainable, green, digital, inclusive, and year-round sports and recreational tourism in Poreč and Istria. The total value of the project, managed by Imperial Riviera, is EUR 6,059,631,21 of which EU grants amount to EUR 1,586,126.72.

The Bike Centre Poreč offers the rental of a large number of the latest generation electric and mechanical bicycles of various types. The centre also provides guided cycling tours in the destination, as well as transfer services for persons and bikes, and bicycle repair services for guests and local residents. The Bike Centre Poreč includes a themed cycling park with a large asphalt pump track covering 566 m2 and a circular children's trail, which is open to the public and free for guests and local residents.

The Bike Centre Poreč hosted the first 'Poreč Loves Bike' cycling event, organised by the City of Poreč, the Poreč Tourist Board, and the Poreč Cycling Club, under the auspices from Valamar. The first edition of the event attracted around 200 participants of all ages who cycled the Parenzana trail.

Valamar also supported the recreational race Istria300 as a sponsor, which in its third and largest edition to date attracted more than 3,600 cyclists from around the world to Istria.

In mid-September, the traditional Tunalicious festival took place in Poreč, with Valamar as the general sponsor. This year's edition of the festival attracted almost 5,000 visitors with a rich gastronomic programme, including the Tuna Restaurant Week, the Tunalicious Street Food Festival, and the Spinnaker Gourmet Stage, along with TunIstra, a major international big-game fishing competition.

In September, Valamar initiated a new call within its socially-responsible project 'Valamar Takes Care about Delicious Lunches', in which all elementary schools in Istria, Rijeka and its surroundings and the island of Krk can participate. The awarded schools will win the 'Week of Local Snacks', during which Valamar will provide meals for all students, prepared for nutritionally rich and high-quality local ingredients.

Valamar joined forces with UNICEF, the global organization for the promotion and protection of children's rights worldwide, to empower its employees and help them cope with the challenges of parenting. In cooperation with UNICEF, the Company organised a series of online trainings about positive parenting for parents of children aged 0 to 8 and workshops for parents of teenagers.

In Poreč and Rabac, Valamar organised a workshop on how to approach guests with disabilities. Workshops were organised by the association Centre for Value Development, and the goal is to educate tourism employees about the needs of guests with various physical impairments.

IN COOPERATION WITH UNICEF, A SERIES OF ONLINE TRAININGS ABOUT POSITIVE PARENTING FOR PARENTS OF CHILDREN AGED 0 TO 8 ORGANIZED

The Ana Rukavina Foundation and Valamar organised a campaign for the registration of donors in the Croatian Registry of Voluntary Donors of Hematopoietic Stem Cells, in which 402 citizens of Poreč volunteered, among whom a large number of Valamar employees. The goal of the campaign was to help a two-year old boy who lives near Poreč as well as a number of sick persons who search for a matching donor.

Valamar has been named the favourite tourism company in Croatia among the female audience, winning the prestigious 'Woman's Choice Award.' One of the leading women's portals, miss7, has been conducting the 'Woman's Choice Award' survey for seven consecutive years, and this year they awarded Valamar the recognition of favourite brand in the hotel chain category.

In September, Valamar supported the world's largest sailing project for socially disadvantaged children and youth by providing three sailboats as part of the Mirno More Peace Fleet. The organiser of this sailing event is Mirno More, an association for social-pedagogical peace projects from Austria. This year, over 650 children from nearly 30 countries, including Croatia, Austria, Germany, Slovenia, Bosnia and Herzegovina and Serbia, sailed on around one hundred sailboats

Governance

Valamar's commitment to sustainability is underscored by the array of certifications and accolades bestowed upon Valamar Group and properties by certification bodies and organisations.

Sustainability certificates are an independent confirmation of Valamar's adherence to rigorous standards of environmental protection and social responsibility. They affirm our dedication to incorporating ecological considerations, health and safety protocols, labour and human rights principles, and community welfare into our business decisions. In 2024, Valamar also continues with the certification of its properties. This quarter we have made all necessary preparations so that our properties can continue to uphold ISO 9001 quality certifications, ISO 14001 environmental certifications and ISO 50001 energy management standard as well as to uphold the Travelife sustainability certifications for 28 hotels, the EU Ecolabel recognition for 6 campsites, and a notable tally of 16 Blue Flag certifications for our beaches.

In 2024, Valamar continues cooperating with its partners according to sustainability criteria as well as raising supplier awareness by collecting data and changing product

THE GOAL BY 2025 IS TO ACHIEVE THAT 80% OF THE PROCUREMENT VALUE COMES FROM RESPONSIBLE AND SUSTAINABLE SUPPLIERS

packaging materials. Valamar continues fostering cooperation with sustainable suppliers by applying a new approach to the collection of data from its suppliers for the calculation of scope 3, by calculating the scope of three groups, by ongoing efforts to eliminate disposable plastic from our properties, and by the administration of ESG surveys. Based on the data collected, Valamar develops criteria, policies and cooperations whereby it aims to ensure that 80% of our procurement value is sourced from responsible and sustainable suppliers by 2025. To this end, we've introduced a Supplier Code of Conduct, outlining fundamental principles for ethical conduct among Valamar's partners to foster responsible operations and contribute to sustainable business practices.

The Croatian Green Building Council, the national partner of the DGNB System for Croatia, which is the leading international certification system for green building, has awarded Valamar Amicor Green Resort on the island of Hvar a gold precertificate for the sustainable construction of standalone villas. This makes Valamar the first tourism company on the path to a gold sustainability certificate, and Valamar Amicor Green Resort the first such resort in this part of Europe.

The leading European camping organization ACSI has awarded Krk Premium Camping Resort by Valamar the Award for Best Campsite in Croatia in the Best Campsite 2024 category, based on votes from European campsite guests.

At the Annual CX.hr Portal Awards held in June 2024, Valamar's reservation centre won first place in the category Contact Centre with 31 or More Workstations, confirming the exceptional effort, dedication, and excellence demonstrated daily in working with guests.

Valamar places great importance on cultivating trust among the public, employees, investors, institutions, and partners through open communication and corporate social responsibility. The support of key stakeholders is of utmost importance to Valamar, which was especially evident during the recent challenging period when Valamar was able to safeguard all jobs and ensure the long-term sustainability of its business. Valamar published its integrated report for 2023 within the statutory timeframe in the first half of 2024, accessible through the following link: https://valamar-riviera.com/en/media/ integrated-annual-reports/.

Valamar has adopted its sustainable business development strategy until 2026, with a EUR 450 million investment plan aimed at building premium resorts of Pical and Rab, further enhancement of the quality level of its hotels and campsites, internationalisation and investing in socially responsible and sustainable tourism projects. The new strategy is geared towards leisure tourism that is beneficial for its destinations, employees, guests and local communities, while generating new value for investors.

HUMAN RESOURCES

VALAMAR GROUP EMPLOYED ALMOST 6,700 EMPLOYEES ON 30 SEPTEMBER 2024

This year too, Valamar has hired the necessary workers for the season, and accommodation has been provided for all employees who come to work in our destinations. One of Valamar's goals is to effectively onboard new employees. ValamarGO! Programme has been held in all destinations to prepare the new employees for a successful start. Employees in the kitchen, restaurant, and reception had the opportunity to learn from the best mentors at Valamar and undergo intensive training over 5 days.

Valamar is one of the largest employers in Croatia. As of 30 September 2024, the Valamar Group employed a total of 6,692 employees, of which 2,683 permanent employees and an additional 2,152 employees with a fixed-term contract receiving year-round income through the Permanent Seasonal Employee measure. On that same day, the Company had 5,049 employees, of which 2,099 permanent employees and an additional 1,575 employees with year-round income.

Significant investments in Valamar's employees have continued. In agreement with its social partners, Valamar has increased the basic salary for more than 5,000 employees. The salaries for professional positions – chefs, waiters, receptionists and several other positions in hotels, campsites and resorts – have also increased and range from EUR 1,400 to 2,000 net in the high season. Housekeepers, assistant chefs, assistant waiters, kitchen staff, servers and other positions received between EUR 1,000 and 1,300 in the high season.

This year, Valamar has once again been recognised as the most desirable employer in the tourism and hospitality sector and is the only tourism company on the list of top 20 Croatian employers.

As was the case in the previous years, Valamar is continuing with a series of reward programs designed to reward excellence, dedication and outstanding results. Apart from salary increases, several initiatives have been launched to improve the working conditions in tourism and to adapt the jobs in Valamar to the new trends and employee needs. As of this year, employees who live in our destinations as well as employees who permanently move to our destinations receive an additional EUR 400 net within the Live the Destination measure, whereby year-round local work and local employment is incentivised and a range of benefits is offered to Valamar's employees. This includes, e.g., the Roof Over Your Head programme, which offers to permanent employees and permanent seasonal employees in the V+3 programme the possibility to be eligible for an add-on of up to EUR 500 per month for rent as well as discounts in more than three hundred points of sale. In addition, Valamar employees can work during winter in Valamar hotels on ski resorts in Austria, and ensure a year-round income this way.

In the last 5 years, EUR 18.5 million has been invested in building high-quality accommodation for seasonal workers called Valamar House. Five such employee hotels are available to our seasonal employees at two locations in Poreč, and in Krk, Rabac and Dubrovnik. Throughout the years we have been investing in this project, improving our concept of providing modern high-quality accommodation and meals for seasonal employees during their stay in the destination where they work.

From the very beginning, Valamar has been involved in the Programme of Boosting the Education of Hospitality and Tourism Workforce, implemented by the Ministry of Tourism and Sports, which is used to co-finance the scholarships for students of vocational tourism and hospitality schools. Valamar is the largest provider of scholarships in Croatia. In the school year 2023/2024, Valamar has given scholarship to 156 high school students and 37 college students.

Valamar, as an employer, is involved in a wide range of activities aimed at motivating the current high school students and the current and future college students to pursue education for jobs in tourism. This includes presentations to students and showcasing career opportunities in tourism. Seven such meetings with elementary and high schools and nine with colleges have been held this year. In these types of presentation of the Company, all students have the chance to hear from Valamar employees directly what it is like to work in the biggest Croatian tourism company and learn everything about the benefits and career development at Valamar. Besides organising such presentations, the Company actively participates in improving the education quality itself, by having Valamar's specialists and mentors give lectures in schools. Students can also visit VALAMAR CONTINUES WITH A SERIES OF REWARD PROGRAMS THAT SPECIFICALLY REWARD EXCELLENCE

Valamar's hotels and campsites to gain firsthand knowledge about the actual needs and working requirements. Valamar continues its business training programme in tourism and hospitality, the V-Executive, in collaboration with five Croatian higher education institutions: the Faculty of Economics and Business of the University of Zagreb, the Faculty of Economics and Tourism in Pula, the Faculty of Tourism and Hospitality Management in Opatija, the Faculty of Economics in Split and the University of Dubrovnik. The two-year business training programme V-Executive offers Valamar employees a comprehensive knowledge and skillset necessary for a successful career in the tourism and hospitality industry. The programme V-Executive started at the beginning of this year; 7 modules have been completed so far. The programme is designed with a total of 20 modules divided into 7 thematic units, and its goal is to familiarise the participants with new trends, enable new knowledge transfer about the industry and teach attendees how to apply innovations, all in line with an organisational culture focused on knowledge and progress.

The Company and the Group have been systematically and continuously investing in developing its human resources. This includes a comprehensive strategic approach to HR management, a transparent recruitment process, clear goals, measuring employee performance, investing in employee development and career advancement and encouraging two-way communication.

The Risks of the Company and the Group

Tourism is a global industry, closely connected with the real and financial economy, geopolitical position and environmental sustainability. The integrity of this industry will determine its future growth. Given the importance of tourism and its overall impact on society, the Company and the Group monitor and assess risks at micro and macro levels. Moreover, when defining the strategy, particular attention is given to the short and medium–term risk impact in order to maintain business sustainability over time.

When monitoring and assessing risks the Company and Group use a proactive approach thus assessing the potential impact of each individual risk. The Company and Group consider risk management to be a key factor of differentiation among competitors. Risk management aims at creating sustainable value, thus offering reliability and security to numerous stakeholders.

There are five key steps in a risk management process:

1) Identifying potential risks;

2) Assessing identified risks;

5 KEY STEPS IN RISK MANAGEMENT PROCESS

3) Determining actions and responsibilities for efficient risk management;

4) Monitoring and overseeing preventive actions;

5) Exchanging information on risk management results conducted by the Management board.

The different types of risks facing Valamar can be classified into the following groups:

• Financial risks - related to financial variables, can have a negative impact on meeting liabilities for the company and the Group, liquidity, debt management etc.;

• Business risks - related to the way company business is conducted in terms of supply and demand, competition, adapting to market trends, investments, growth etc.;

• Operational risks - can arise from inadequate use of information, errors in business operations, non-compliance with internal procedures, human error, IT system, financial reporting and related risks, etc.;

• Global risks - can arise from natural disasters, pandemics, food shortage, social unrest, wars and other force majeure events beyond Valamar's control;

• Compliance risks - can arise from failure to comply with state laws and local regulations; risks related to changes in tax and other regulations.

FINANCIAL RISKS

In their day-to-day business activities, the Company and Group face a number of financial threats, especially:

1) Foreign exchange risk; 2) Interest rate risk; 3) Credit risk; 4) Price risk; 5) Liquidity risk; 6) Share-related risks; 7) Risk of inflation and increase in prices of purchased goods.

The Company and Group have a proactive approach in mitigating interest rate and foreign exchange risks, by employing available market instruments. Internal risk management goals and policies aim at protecting foreign currency inflows during seasonal activity and partial interest hedging of the principal loan amount.

1) Foreign exchange risk

The Company and the Group operate internationally and are exposed to currency risks. Until 1.1.2023, the currency risk was mainly due to the changes in the nominal exchange rate of euro/kuna. Namely, a large part of liabilities was expressed in euros, while most sales revenues were historically realised in euros as well. At the level of the Company and the Group, the business with other currencies accounts for less than 1% of the total turnover. After the introduction of the euro as the national currency, a significant currency risk exposure is no longer expected.

2) Interest rate risk

Variable rate loans expose the Company and Group to cash flow interest rate risk. Actively, the Company and Group resort to derivative instruments in order to hedge cash flow and interest rate by applying interest rate swaps. The economic effect of such swaps is the conversion of variable interest rate loans into fixed interest rate loans for a precommitted hedged part of the loan principal. Therefore, a major part of the loan portfolio is comprised of long-term fixed interest loans or, respectively, loans hedged by a derivative instruments (IRS). The Company and Group have interest-bearing assets (cash assets and deposits) so their revenue and cash flow depend on changes in market interest rates. This becomes evident especially during the season when the Company and Group have significant cash surpluses at their disposal. The Company and the Group expect a limited impact from the increased interest rate volatility consequent to the recent coronavirus pandemic, since almost entire Group's loan portfolio is made up of long-term fixed-rate loans or loans protected by derivative instruments (IRS).

3) Credit risk

Credit risk arises from cash assets, time deposits and receivables. According to the Company and Group sales policy, business transactions are conducted only with customers with suitable credit history, i.e. by agreeing advances, bank securities and (for individual customers) payments made through major credit card companies. In order to reduce credit risk, the Company and the Group continuously monitor their exposure to the business parties and their creditworthiness, obtain instruments for securing receivables (bills of exchange, debentures and guarantees), thus reducing the risks of uncollectability of their receivables for the services provided. In view of the negative effects of COVID-19, inflationary development and the growth of interest rates on the customers of the Company and the Group, especially tour operators and travel agencies, the impact of the currently unfavourable circumstances on the related parties is being closely monitored, while actively reviewing the credit ratings and their potential to overcome current challenges.

4) Price risk

The Company and Group hold equity securities and are exposed to equity price risk due to security price volatility. Valamar is not an active participant in the market trade in terms of trading in equity and debt securities. However, with investments in buying Imperial Riviera and Helios Faros shares, the company is exposed to the said risk to a certain extent.

5) Liquidity risk

The Company and Group have a sound liquidity risk management. Sufficient funds for meeting liabilities are available at any given moment through adequate amounts from contracted credit lines and by ensuring credit line availability in the future. Liquidity risk is managed by generating strong positive net operating cash flows, while capital investments are financed by credit lines. Credit lines for 2020 and 2021 have been contracted with reputable financial institutions, while credit repayments in general are in line with the period of significant cash inflows from operating activities. The repayment of the major credit lines coincides with periods of strong cash inflows from operations. The Company and Group monitor the level of available funds through daily cash and debt reports. Long-term cash flow forecasts as well as annual (monthly) forecasts are based on the set budget. After meeting the needs of working capital management the surplus is deposited in the treasury. From there the funds are invested in current accounts, time deposits, money market deposit accounts and marketable securities. Only instruments with suitable maturities and sufficient liquidity are selected, according to the forecast needs for liquid funds.

6) Share-related risks

The market value of shares is the riskiest asset class due to its volatility resulting from the volatile nature of the whole capital market, macroeconomic trends on markets where the Company and Group operate and discrepancies between the expectations of financial analysts and the actual results. Furthermore, other contributing factors are also changes in the dividend policy, various activities in the segment of consolidations, mergers, acquisitions and forming of strategic partnership, the instability of the business model of the Company and Group as well as the fluctuations in the financial results for the Company and Group. In case any negative implications happen to be associated with these factors there is a considerable risk of market value drop that will in turn prevent investors from selling their shares at a fair market price.

7) Risk of inflation and increase in prices of purchased goods

COVID-19 pandemic and related movement restrictions as well as supply disruptions, along with strong rising energy prices and the war in Ukraine, have induced global inflation and rising prices at the end of 2021, with a noticeable influence to this day.

According to the second estimate of the Croatian Bureau of Statistics, the prices of goods and services for personal consumption, measured by the consumer price index, were on average 1.6 percent higher in September compared to September 2023. The year-on-year inflation rate for September is lower than for August (1.8), July (2.2) and June (2.4 percent.).

According to the Croatian National Bank (CNB), the slowdown in inflation, which has been ongoing since the end of 2022, mirrors lower prices of energy, food and other raw materials in the global market as well as the normalisation of global supply chains, which spilled over to import and producer prices in the domestic market, as well as the effects of the restrictive monetary policy. Meanwhile, the current inflationary pressures have been low across all segments of the consumer basket since the end of last year, except for services price inflation. The slowdown in inflation was also due to favourable base effects caused by higher monthly inflation rates, which were particularly pronounced until August last year. Due to negative base effects and the announced price increases for gas, electricity and heat, overall inflation may temporarily accelerate in the remaining part of 2024 and early 2025, and then continue its gradual decline.

Inflation and rising prices of purchased goods may have an effect on the purchasing power of foreign and domestic guests, as well as on the level of our selling prices. The Company and the Group have also been exposed to the impact of the changes in the purchase prices for energy products (especially electrical energy) as well as prices for food and beverages and consumables. The Company and the Group have been continually making considerable investments in energy efficiency and renewables in order to mitigate the impact of a possible increase in energy prices as well as to decrease their dependence on suppliers. The Company and the Group have a very high share of direct channels and other online channels in total sales, and sales prices are largely formed dynamically, during the year. Accordingly, the Company and the Group have the flexibility to manage selling price levels.

BUSINESS RISK

The Company and Group are constantly exposed to risks threatening its competitiveness and future stability. Since the Company and Group own significant number of real estates, this business model requires a large amount of capital in order to maintain high product and service standards. Various large capital investments in the upgrade of products and services can surpass budget expectations, delay the end of construction works, as well as the town-planning regulations and fiscal policy may be changed. These risks can increase costs for the Company and Group, and have a negative impact on the cash flow and revenues. In the previous period, the company and Group's business decisions improved their results in the demanding Mediterranean market. These positive trends are expected to continue in the future through a prudent long-term strategic management.

Around 90% of Valamar's guests come from other countries and they are very careful when choosing their vacation destination in the competitive Mediterranean environment. Stable domicile countries macroeconomic indicators are important decision-making factors especially those relating to exchange rates and the price of goods and services because they directly affect the guests' purchasing power.

However small, the share of domestic guests is also important; it is a segment directly influenced by various other macroeconomic indicators: employment/ unemployment rate, GNP rise/ fall, industrial production and others. They all have a direct impact not only on the purchasing power of Croatian residents, but they also determine whether they will choose to spend their vacation in one of our properties.

When considering risks related to the tourism and hospitality industry, in previous years, the Croatian economy has been afflicted by the consequences of a global financial crisis and economic standstill. In this period, the tourism and hospitality industry has been among the rare growing industries in Croatia. Moreover, the marked seasonality of this industry leads to insufficient use of the Company and Group's resources. After joining the European Union, the Croatian market became part of a large European market, while safety risks decreased after joining the NATO. Good management of human resources is vital for the future growth of the Company and Group. Risks related to shortages of specific skills, expertise and jobs are connected with the opening and expansion of the labour market. Valamar Riviera is one of the largest and most desirable employers in tourism. The active approach towards HR management develops key talents and supports investments in training opportunities. We determine the needs for new skills and expertise by following emerging global trends in tourism. In this way, we are able to respond to challenges effectively. Through a continual dialogue with our social partners, we have ensured a high level of workers' rights in terms of competitive salaries, reward systems, career development, employees' wellbeing and cooperation with training institutions from all parts of Croatia.

The Company is the respondent in two court proceedings from which potentially significant financial obligations for the Company may arise.

The first lawsuit from 2010 is related to the payment for the works on hotel Lacroma during its reconstruction and extension. In 2013, the Commercial Court issued a verdict rejecting the plaintiffs' claims in their entirety. In 2020, the High Commercial Court of the Republic of Croatia overturned the first-instance verdict, and the case was returned for retrial. In the repeated proceedings, the Commercial Court, by the verdict from May 2023, largely accepted the claim and the Company is charged with the payment of principal in the amount of EUR 2,264,861.17 and litigation costs in the amount of EUR 702,752.22 as well as the corresponding statutory default interest. In the appeal procedure, the High Commercial Court of the Republic of Croatia on 31 January 2024 adopted a final verdict in favour of the Company whereby it altered the verdict of the Commercial Court of Dubrovnik from May 2023 and rejected all the claims of the plaintiff as unjustified. The claimants submitted a motion for permission to file a second appeal regarding the judgment of the High Commercial Court of the Republic of Croatia dated 31 January 2024, to which the company submitted its response. The company has not yet made provisions in its business ledgers or booked the expenses for this dispute.

The second lawsuit from 2012 also refers to the payment for the works on Lacroma Hotel. The first-instance judgment of the Commercial Court from 2015, confirmed in the second instance in 2019 by the High Commercial Court, rejected the plaintiff's claim. However, on 4 July 2023, the Supreme Court of the Republic of Croatia overturned the judgments of the Commercial Court and the High Commercial Court and returned the case for retrial. Based on the receivables referred to in the plaintiff's claim, the principal in this case amounts to EUR 1,498,608.42. In February 2024, in the retrial, the Commercial Court in Dubrovnik passed the first-instance judgment in favour of the Company. On 26 March 2024, in the appellate procedure further to the plaintiff's appeal, the High Commercial Court of the Republic of

Croatia delivered a final judgment against the Company, whereby it overturned the judgment of the Commercial Court in Dubrovnik from February 2024 and found in favour of the plaintiff. On 28 May 2024, the Company submitted a motion to permit the second appeal against the judgment of the High Commercial Court of the Republic of Croatia. On 23 May, based on the final and enforceable judgment of the High Commercial Court of the Republic of Croatia, the transfer of funds from the Company's account to the account of the Financial Agency was carried out. On 3 June 2024, the Company petitioned the competent court to postpone issuing orders to banks regarding the transfer of the seized funds. On 4 July, the Municipal Court in Pazin issued an order instructing the Financial Agency to postpone issuing orders to banks regarding the transfer of the seized funds until the Supreme Court of the Republic of Croatia delivers its judgment on the above motion to permit the second appeal. The creditor has filed an appeal against the order to postpone the issuance of orders to banks regarding the transfer of the seized funds, and the Company submitted its response to this appeal. The appellate proceedings before the County Court in Zagreb are ongoing. In September 2024, the Supreme Court of the Republic of Croatia issued a decision refusing the Company's motion to permit the second appeal against the judgment of the High Commercial Court of the Republic of Croatia from 26 March 2024, whereby the transfer of funds to the creditor has been enabled. In the second quarter of 2024, the Company booked expenses amounting to EUR 4.1 million for the principal amount and the default interest relating to this lawsuit.

In 2023, the Company initiated an administrative dispute to annul the Resolution of the Ministry of the Sea, Transport and Infrastructure, adopted after an inspection of the commercial utilisation of the maritime domain in the area of the Ježevac camping on the island of Krk. This Resolution includes a prohibition on providing accommodation services on several cadastral parcels and a prohibition on providing anchoring services. In 2024, a non-final judgment was delivered against the Company, and the Company appealed against this judgment to the competent court. The Government of the Republic of Croatia, in its June 2024 Conclusion, charged the Ministry of the Sea, Transport and Infrastructure to urgently establish maritime domain boundaries for all campsites in front of which maritime domain boundary has not been determined. It also ordered that the Customs Administration and the Maritime Safety Directorate of the Ministry of the Sea, Transport and Infrastructure stay such inspection measures that prohibit the operation of campsites until unresolved property relations concerning the respective maritime domains are resolved, at the latest by 31 December 2025. Also, the Customs Administration will charge companies a fee for the undisputed area of the maritime domain they utilise, starting from 1 January 2019 until the respective property relations are resolved. In July, the Ministry of the Sea, Transport, and Infrastructure accepted the Company's proposal to reopen the proceedings and lifted the prohibition on providing accommodation services in the Ježevac camping. In the fourth quarter of 2023, the Company made provisions for this case amounting to EUR 130,0000 and will continue to actively pursue future legal proceedings in this matter.

OPERATIONAL RISKS

Operational risks are risks connected with direct or indirect losses that arise form inadequate or wrong internal or external processes within the Company and the Group. They include the creation and analysis of financial reporting data (also known as "financial reporting risk") and also the potential insufficient and inadequate internal and external information sharing. When implementing the system of operational risk management, the Company and Group focused on its continuity and complexity due to the size of the organization. The benefits of the system include i) defining and identifying the Company and Group risk profile in relation to the operating risk ii) identifying and managing the known risk occurrences in order to decrease the Company and Group costs and iii) data analysis which indicates the business trends for the Company and Group and trends in the domestic economy. The Company and Group are aware of the reliability of IT business solutions and safety in the cyber world. Hence, they continually upgrade, develop and implement new technologies and protective mechanisms in everyday business operations. A special focus is given to providing sufficient resources for the development and implementation of new technologies related to ICT, data protection, and upgrade of the current business systems and implementation of new ones.

GLOBAL RISKS

Despite improved security and political conditions, which have encouraged to a certain extent investments into tourism and hospitality, there are challenges that the Croatian tourism has to face, such as:

• Periods of global economic and financial crisis which reduce the purchasing power of the travelling-prone population;

• Security and political issues related to global terrorism threats;

• Security and political instability in the immediate environment of the neighbouring countries.

• geopolitical risks connected with the Russian invasion of Ukraine in February 2022.

Environmental risks can also have an adverse effect on the Company and Group's business results, primarily in terms of customer satisfaction with the whole experience while staying at one of Valamar's properties and this can affect the number of arrivals. The possible risks can include: sea pollution (caused by oil or chemical spillage), but also long-term water quality reduction and coast pollution due to inadequate waste disposal and waste water treatment as well as extensive use of agricultural fertilizers. Other environmental conditions typical for climate changes such as long drought periods or long rainy periods can directly influence the guests' length of stay in the hotels and campsites as well as increasing the operating costs. A number of other natural disasters and calamities (earthquakes, fires, floods and rainstorms), air pollution caused by toxic gas emissions from industrial plants and vehicles, as well excessive urbanization and the introduction of plant and animal invasive species should also be taken into consideration. Likewise, disease outbreaks and pandemics can adversely affect Valamar's business results. In order to minimize their impact, Valamar is actively tracking pandemic and health risk levels worldwide, especially on its source markets, and taking proactive steps in their management. The COVID-19 pandemic is a recent example of the operational and financial disruption to the global economy, especially tourism flows, since almost all global destinations were blocked by travel restrictions. The emergence of exceptional circumstances in the Republic of Croatia and the introduction of extraordinary measures to prohibit gatherings, movements and the operation of restaurants and shops, all with the primary objective of protecting the population from the risk of contagion, resulted in the expected consequential and immediate disruption of the Company's and the Group's operations, cancellation of accommodation and other contracted services by partner agencies and guests.

The risks related to Russia's invasion of Ukraine in February 2022 are still present. The source Russian and Ukrainian markets historically made up a maximum of 2% of Valamar's turnover so their disappearance has been compensated by other source markets.

REGULATORY RISKS

Changes in tax laws and other regulations pose a very serious threat and represent a demanding segment in risk management because in this particular situation the possibilities for the Company and Group are limited.

Frequent changes in laws regulating taxes and parafiscal charges often take place only after the business policy and budget for the next financial year have been approved and commercial terms and conditions with partners agreed. All this jeopardizes the Company and Group financial position and future investment plans as well as credibility towards shareholders. One of the recent examples is the introduction of the Law on Additional Profit Tax from December 2022.

The Company and Group are also threatened by changes in regulations governing concession fees for maritime domain and tourism land use, the latter still presenting unresolved legal issues. Given the nature of the Company and Group's business, the right to use parts of the maritime domain as well as land for tourism purposes is of vital importance for future growth, especially for campsite-related operations.

Corporate Governance

The Company and the Group continuously strive to develop and operate according to good corporate governance practices. The business strategy, corporate policy, key corporate by-laws and business practice have set a high standard of corporate governance and are all geared towards creating a transparent and efficient business operation while forging solid bonds with the local community. The Management Board fully complies with the provisions of the adopted corporate governance acts. After the company was listed on the regulated market of the Zagreb Stock Exchange, the Company also complied with the Zagreb Stock Exchange Corporate Governance Code.

The Company complies with and implements the prescribed corporate governance measures, as reported in more detail in the annual questionnaire published on the Zagreb Stock Exchange and Valamar Riviera websites as prescribed (2023 questionnaire available at https://valamar-riviera.com/media/482338/corporategovernance-code-compliance-questionnaire-2023-pdf.pdf). The Company adopted its Code of Business Conduct and policies that make an integral part of this Code, whereby it aligned its internal corporate governance rules with the Zagreb Stock Exchange Corporate Governance Code. The Code of Business Conduct is available at the Company's corporate website (https://valamar-riviera.com/ media/479268/code-of-business-conduct-valamar-riviera-dd-october-24-2023. pdf).

According to the data from the Central Depository and Clearing Company, significant direct holders of the Company's shares and the holders of shares who are also members of the Management Board and members of the Supervisory Board of the Company are the following persons: Supervisory Board Chairman Mr. Franz Lanschützer, who is the holder of 4,450,000 shares; Deputy Chairman of the Supervisory Board Mr. Mladen Markoč, who is the holder of 46,267 shares; member of the Supervisory Board Mr. Gustav Wurmböck, who is the holder of a 100% stake in the company Wurmböck Beteiligungs GmbH, which is the holder of 25,059,300 shares; member of the Supervisory Board Mr. Georg Eltz, who is the holder of a total of 6,630,511 shares, of which he directly holds 20,463 shares, and indirectly, through a stake in the company Satis d.o.o., 6,610,048 shares; member of the Supervisory Board Mr. Boris Galić, who is the holder of 10,000 shares; member of the Supervisory Board Mr. Ivan Ergović, who is the holder of 3,579 shares; member of the Supervisory Board, Ms. Gudrun Kuffner, who is holder of 3,000 shares; President of the Management Board Mr. Željko Kukurin, who is the holder of 209,192 shares; member of the Management Board Mr. Marko Čižmek, who is the holder of 111,035 shares; and member of the Management Board Ms. Ivana Budin Arhanić, who is the holder of 77,991 shares.

THE GROUP HAS ESTABLISHED HIGH STANDARDS OF CORPORATE GOVERNANCE IN ORDER TO OPERATE TRANSPARENTLY AND EFFICIENTLY

The Company defined the process of preparing and publishing its financial statements in a detailed internal document. Within this document, the financial reporting procedure is set within a system of internal review and risk management. Additionally, in order to monitor and mitigate the financial reporting risk, the Company uses the measures described in the chapter 'The Risks of the Company and the Group'.

The Companies Act and the Company's Articles of Association define the General Assembly's authority and prescribe how it meets and works. The meeting invitation, proposals and the adopted resolutions are made public according to the provisions of the Companies Act, Capital Market Act and the Zagreb Stock Exchange Rules. There is a time limit related to the voting right at the General Assembly: according to the provisions of the Croatian Companies Act, shareholders are required to register their participation within the prescribed time limit in order to attend the General Assembly. Under no circumstances can the financial right arising from securities be separated from holding the securities. There are no securities with special control rights nor are there any limitations to voting rights at the Company (one share, one vote).

The Company's Articles of Association comply with the Croatian Companies Act and the provisions of the Procedure of Appointment, i.e. the Election and Profile of the Management Board and the Supervisory Board and they define the procedure of appointing and recalling members of the Management Board and Supervisory Board. There are no limitations based on gender, age, education, profession or similar. The Companies Act determines any amendments to the Company's Articles of Association, without any additional limitations. The Management Board members' authority fully complies with the provisions referred to in the Companies Act and it is defined in more detail by the provisions of the Articles of Association and the By-Laws on the Work of the Management Board.

The Company has the option to acquire its treasury shares based on and following the conditions set out by the General Meeting's resolution on the acquisition of treasury shares dated 9 May 2019 which is in effect until 17 November 2024, and by the new General Meeting's resolution dated 24 April 2024 which be in effect as of 18 November 2024. The Company does not have a share-buyback programme or an employee share ownership plan. The Company holds and acquires treasury shares as a form of rewarding management and key managers pursuant to the Company by-laws regulating rewarding plans and to make possibly dividend pay-out in rights, i.e. to give the Company's shares to equity holders. Based on the authority granted by the General Meeting, Valamar Riviera d.d. intends to acquire its treasury shares on the regulated market of the Zagreb Stock Exchange by the end of this year, primarily for its Long-Term Incentive Plan for remuneration in shares, predictably up to a value equivalent to EUR 2 million.

Following the adopted long-term plan for rewarding key management by giving them treasury shares in the period from 2023 to 2026, which is aimed at increasing loyalty, focusing on business targets' achievement and shareholder value increase, key managers were rewarded with treasury shares on 12 March 2024. In order to make the payout of this reward to key managers, a total of 426,160 treasury shares were disposed of. After making this disposal of treasury shares in the first nine months, the Company now holds 2,990,862 treasury shares in total, which makes 2.3732% of the Company's share capital.

THE COMPANY'S CORPORATE BODIES ARE:

The Management Board: Mr. Željko Kukurin, CEO, and Mr. Marko Čižmek and Ms. Ivana Budin Arhanić, members.

The Company appointed senior executives, who are the Company's key management, in accordance with the provisions of the Capital Markets Acts and the EU Regulation No. 596/2014. The Company's senior executives are the following – 3 Senior Vice Presidents: Alen Benković, Davor Brenko and David Poropat; 2 Vice Presidents: Ines Damjanić and Sebastian Palma; and 26 Sector Directors and Heads: Tomislav Dumančić, Mauro Teković, Bruno Radoš, Sandi Sinožić, Andrea Štifanić, Željko Jurcan, Ivan Karlić, Mario Skopljaković, Dario Kinkela, Mile Pavlica, Tomislav Poljuha, Dragan Vlahović, Flavio Gregorović, Martina Šolić, Vedrana Ambrosi Barbalić, Mirella Premeru, Ivica Vrkić, Giorgio Cadum, Vlastimir Ivančić, Lea Sošić, Roberto Gobo, Ivan Polak, Karmela Višković, Denis Prevolšek, Marko Vusić, Vlatka Kocijan and Antonio Beg.

The Supervisory Board: Mr. Franz Lanschützer, Chairman, Mr. Mladen Markoč, Deputy Chairman, Mr. Daniel Goldscheider, Deputy Chairman, Mr. Gustav Wurmböck member, Ms. Gudrun Kuffner, member, Ms. Petra Stolba, member, Mr. George Eltz, member, Mr. Boris Galić, member and Mr. Ivan Ergović, member (workers' representative).

In order to perform its functions more efficiently, as well as to perform the tasks prescribed by the provisions of the Audit Act and the Corporate Governance Code, the Supervisory Board appointed the following bodies:

The Praesidium comprised of Mr. Franz Lanschützer, Chairman, and Mr. Mladen Markoč and Mr. Daniel Goldscheider, Deputy Chairmen.

The Audit Committee comprised of Ms. Gudrun Kuffner, Chairwoman, and Mr. Georg Eltz, Mr. Gustav Wurmböck, Mr. Mladen Markoč and Mr. Boris Galić, members.

The Investment Committee comprised of Mr. Daniel Goldscheider, Chairman, and Mr. Franz Lanschützer and Ms. Gudrun Kuffner, members.

The Digitalisation and Sustainability Committee, comprised of: Ms. Petra Stolba, Chairwoman, Mr. Franz Lanschützer and Mr. Daniel Goldscheider, members.

Compliant with applicable regulations and Company by-laws, the Management and Supervisory Board primarily act through meetings and by correspondence in their decision-making. The Company has concluded employment contracts with the President and members of the Management Board for the duration of their term of office (from 1 January 2022 to 31 December 2026), and only one member of the Supervisory Board, who is a workers' representative, has an employment contract for an indefinite period.

Related-party Transactions & Branch Offices

R E L AT E D - PA R T Y T R A N S AC T I O N S

Related party transactions among the Group companies are carried out according to usual commercial terms and conditions and deadlines and under market prices.

In the first nine months of 2024, EUR 14.8 million of revenue from transactions with related parties was generated (EUR 12.3 million in first nine months of 2023) for the Company and EUR 2.1 million (EUR 1.5 million in first nine months of 2023) for the Group. Expenses amounted to EUR 2.1 million (first nine months of 2023: EUR 1.8 million) for the Company and EUR 248 thousand for the Group (first nine months of 2023: EUR 148 thousand). On May 23, 2024, the Company received a dividend from Imperial Riviera d.d. in the amount of EUR 4.9 million.

As at 30 September 2024, receivables and liabilities towards related parties are as follows: company's receivables amount to EUR 3.8 million (vs. EUR 4.7 million EO 2023), and Group's receivables amount to EUR 1.7 million (vs. EUR 2.3 million EO 2023). Company's liabilities amount to EUR 417 thousand (vs. EUR 90 thousand EO 2023), and Group's liabilities amount to EUR 30 thousand (vs. EUR 48 thousand EO 2023).

TRANSACTIONS WITH RELATED PARTIES UNDER USUAL COMMERCIAL TERMS AND CONDITIONS

BRANCH OFFICES OF THE COMPANY

The Company has several branch offices, where it performs its business activities outside of its headquarters: Branch Office for Tourism RABAC, with the seat in Rabac, Slobode 80; Branch Office for Tourism ZLATNI OTOK, with the seat in Krk, Vršanska 8; Branch Office for Tourism DUBROVNIK-BABIN KUK, with the seat in Dubrovnik, Vatroslava Lisinskog 15a; Branch Office for Business and Administration Consulting ZAGREB, with the seat in Zagreb, Miramarska cesta 24; Branch Office for Tourism BRIONI, with the seat in Pula, Puntižela 155 and the Austria Branch Office, with headquarters in Austria, Obertauern, Gamsleitenstrasse 6.

The branch offices of Rabac, Zlatni otok, Dubrovnik-Babin Kuk and Brioni are the drivers of economic growth in their local communities. They operate in their destinations and support their development by promoting further investments and the development of tourism while participating in social and business activities. The branch offices in Zagreb and Austria ensure that the business operations of the Company in these destinations are carried out in accordance with respective regulations.

Except for the branch offices with the registered seat in Croatia and Austria, the Company also established offices on the island of Rab, in Makarska, in Stari Grad on the island of Hvar and in Obertauern in Austria to increase the efficiency and streamline the management of operations of the companies Imperial Riviera d.d., Helios Faros d.d., Valamar Obertauern GmbH, Kesselspitze GmbH & Co KG and of the Company Valamar Marietta Gmbh, all in line with the provisions of the concluded hotel management contracts.

Valamar Share

Performance of Valamar Riviera's share and Zagreb Stock Exchange and travel and leisure indices in the first nine months of 2024

During the first nine months of 2024, the highest achieved share price in regular trading on the regulated market was EUR 5.30, and the lowest EUR 4.55. On 30 Sep 2024 the price was EUR 5.00 which represents an increase of 5.9% compared to the last price in 2023. With a total turnover of EUR 15.0 million15 Valamar Riviera share was the seventh share on the Zagreb Stock Exchange in terms of turnover during the first nine months of 2024.

In addition to the Zagreb Stock Exchange index, the joint stock index of the Zagreb and Ljubljana stock exchanges ADRIAprime, the stock is also a component of the Vienna Stock Exchange index (CROX16 and SETX17) and the Warsaw Stock Exchange (CEEplus18), the SEE Link regional platform index (SEELinX and SEELinX EWI)19 and the MSCI Frontier Markets Index20.

Zagrebačka banka d.d. and Interkapital vrijednosni papiri d.o.o. perform the activities of market makers with ordinary shares of Valamar Riviera listed on the Leading Market of the Zagreb Stock Exchange d.d.

In the first nine months of 2024, the Company did not acquire its own shares, while in connection with the LTIP (long-term reward plan for key managers in the Company's shares in the period from 2023 to 2026) it disposed of 426,160 of its own shares. On 30 Sep 2024 the Company has a total of 2,990,862 own shares or 2.37% of the Company's capital.

Valamar Riviera actively holds meetings and conference calls with domestic and foreign investors, as well as presentations for investors, providing support for the highest possible level of transparency, creating additional liquidity, increasing share value and involving new investors. By continuing to actively represent Valamar Riviera, we will 15 Block transactions are excluded from the calculation.

16 Croatian Traded Index (CROX) is a capitalizationweighted price index and is made up of 12 most liquid and highest capitalized shares of Zagreb Stock Exchange.
21 South-East Europe Traded Index (SETX) is a capitalization-weighted price index consisting of blue chip stocks traded on stock exchanges in the region of South-eastern Europe (shares listed in Bucharest, Ljubljana, Sofia, Belgrade and Zagreb).
18 CEEplus is a stock index that comprise the most liquid stocks listed on stock exchanges in the Visegrad Group countries (Poland, Czech Republic, Slovakia, Hungary) and Croatia, Romania and Slovenia.
19 SEE Link is a regional platform for securities trading. It was founded by Bulgarian, Macedonian, and Zagreb Stock Exchange. SEE LinX and SEE LinX EWI are two "blue chip" regional indices composed of ten most liquid regional companies listed on three Stock Exchanges: five from Croatia, three from Bulgaria, and two from Macedonia.
20 The MSCI Frontier Markets Index captures large and mid-cap representation across 29 Frontier Markets countries

strive to contribute to further growth in value for all stakeholders with the intention of recognizing the Company's share as one of the leaders on the Croatian capital market and one of the leaders in the CEE region.

Analytical coverage of Valamar Riviera is provided by: 1) ERSTE bank d.d., Zagreb; 2) Interkapital vrijednosni papiri d.o.o., Zagreb; 3) Raiffeisenbank Austria d.d., Zagreb; 4) Zagrebačka banka d.d., Zagreb and 5) Ipopema, Warsaw.

7th MOST ACTIVELY TRADED SHARE BY REGULAR TURNOVER ON THE ZAGREB STOCK EXCHANGE IN THE FIRST NINE MONTHS OF 2024

Our commitment to transparency and open communication with stakeholders was awarded the prestigious 'Building Public Trust Award' by PwC Croatia and the Zagreb Stock Exchange in December 2023.

Additional Information

The Management Board expresses its gratitude to all shareholders, business partners, and guests for their support and trust, and particularly to all employees for their contribution.

ADDITIONAL INFORMATION

In the course of the first nine months of 2024 the Company's Management Board performed the actions provided by law and the Articles of Association and regarding the management and representation of the Company and planned a business policy that was implemented with prudent care. The Company's Management Board will continue to undertake all the necessary measures in order to ensure sustainability and business growth.

The quarterly separate and consolidated financial statements for the first nine months of 2024 were adopted by the by the Management Board on 24 October 2024.

The Management Board expresses its gratitude to all shareholders, business partners, and guests for their support and trust, and particularly to all employees for their contribution.

Management Board of the Company

Management Board Management Board Management Board President Member Member

Željko Kukurin Marko Čižmek Ivana Budin Arhanić

Disclaimer

This report may contain certain outlook based on currently available facts, findings and circumstances and estimates in this regard. Our outlook is based including, but no limited on a) results achieved in the firts nine months of 2024; b) operating results achieved by 21 oct 2024; c) current booking status; d) 2024 year end business results forecast; e) the absence of further significant negative effects of the risks to which the Company and the Group are exposed.

Outlook statements are based on currently available information, current assumptions, forward-looking expectations and projections. This outlook is not a guarantee of future results and is subject to future events, risks, and uncertainties, many of which are beyond the control of, or currently unknown to Valamar Riviera, as well as potentially incorrect assumptions that could cause the actual results to materially differ from the said expectations and forecasts. Risks and uncertainties include, but are not limited to those described in the chapter "Risks of the Company and the Group". Materially significant deviations from the outlook may arise from changes in circumstances, assumptions not being realized, as well as other risks, uncertainties, and factors, including, but no limited to:

Macro-economic trends in the Republic of Croatia and in the source markets, including currency exchange rates fluctuations and prices of goods and services, deflation and inflation, unemployment, trends in the gross domestic product and industrial production, as well as other trends having a direct or indirect impact on the purchasing power of Valamar Riviera's guests;
Economic conditions, security and political conditions, trends and events in the capital markets of the Republic of Croatia and Valamar Riviera's source markets;
Spending and disposable income of guests, as well as guests' preferences, trust in and satisfaction with Valamar Riviera's products and services;
Trends in the number of overnights, bookings, and average daily rates of accommodation at Valamar Riviera's properties;
Change in market interest rates and the price of equity securities, and other financial risks to which Valamar Riviera is exposed;
Labor force availability and costs, transport, energy, and utilities costs, selling prices of fuel and other goods and services, as well as supply chain disruptions;
Changes in accounting policies and findings of financial report audits, as well as findings of tax and other business audits;
Outcomes and costs of judicial proceedings to which Valamar Riviera is a party;
Loss of competitive strength and reduced demand for products and services of Croatian tourism and Valamar Riviera under the impact of weather conditions and seasonal movements;
Reliability of IT business solutions and cyber security of Valamar Riviera's business operations, as well as related costs;
Changes of tax and other regulations and laws, trade restrictions, and rates of customs duty;
Adverse climatic events, environmental risks, disease outbreaks and pandemics.
Regional and global geopolitical uncertainties and wars.

Should materially significant changes to the stated outlook occur, Valamar Riviera shall immediately inform the public thereof, in compliance with Article 459 of the Capital Market Act. The given outlook statements are not an outright recommendation to buy, hold or sell Valamar Riviera's shares.

RESPONSIBILITY FOR THE QUARTERLY FINANCIAL STATEMENTS

In Poreč, 24 October 2024

In accordance with provisions of Law on Capital Market, Marko Čižmek, Management board member and CFO, and Vedrana Ambrosi Barbalić, director of Department of Finance and Accounting, procurator, together as persons responsible for the preparation of quarterly financial reports of the company VALAMAR RIVIERA d.d. seated in Poreč, Stancija Kaligari 1, OIB 36201212847 (hereinafter: Company), hereby make the following

S T A T E M E N T

According to our best knowledge:

Unaudited consolidated and unconsolidated financial statements for the first nine months of 2024 are prepared in accordance with applicable standards of financial reporting and give true and fair view of the assets and liabilities, profit and loss, financial position and operations of the Company and the companies included in consolidation (Group);
Report of the Company's Management board for the period from 1 January to 30 September 2024 contains the true presentation of development, results and position of the Company and companies included in the consolidation, with description of significant risks and uncertainties which the Company and companies included in consolidation are exposed. Financial statements for the period from 1 January to 30 September 2024 were not audited.

Marko Čižmek Management Board Member

Vedrana Ambrosi Barbalić Director of Department of Finance and Accounting / Procurator

Reporting period: from 01.01.2024 to 30.09.2024

Quarterly financial statements

Year:	2024
Quarter:	3
Registration number (MB):	3474771		Issuer's home Member State code:	HR
Entity's registration number (MBS):	40020883
Personal identification number (OIB):	36201212847	LEI:	529900DUWS1DGNEK4C68
Institution code:	30577
Name of the issuer:	Valamar Riviera d.d.
Postcode and town:	52440	Poreč
Street and house number:	Stancija Kaligari 1
E-mail address:	[email protected]
Web address:	www.valamar-riviera.com
Number of employees (end of the reporting period):	6691
Consolidated report:	KD	(KN-not consolidated/KD-consolidated)
Audited:	RN	(RN-not audited/RD-audited)
Names of subsidiaries (according to IFRS):	Registered office:		MB:
Magične stijene d.o.o.	Dubrovnik		2315211
Bugenvilia d.o.o.	Dubrovnik		2006120
Imperial Riviera d.d.	Rab		3044572

Bookkeeping firm:	No
Contact person:	Sopta Anka (only name and surname of the contact person)
Telephone:	052 408 188
E-mail address:	[email protected]
Audit firm:
	(name of the audit firm)
Certified auditor:
	(name and surname)

(authorized representative's signature) L.S.

BALANCE SHEET (balance as at 30.09.2024) Submitter: Valamar Riviera d.d. in EUR

	ADP	Last day of the pre	At the reporting date
Item	code	ceding business year	of the current period
1	2	3	4
A) RECEIVABLES FOR SUBSCRIBED CAPITAL UNPAID B) FIXED ASSETS (ADP 003+010+020+031+036)	001 002	728.032.913	829.880.409
I INTANGIBLE ASSETS (ADP 004 to 009)	003	7.113.034	7.313.089
1 Research and development	004
2 Concessions, patents, licences, trademarks, software and other rights	005	5.327.241	3.239.438
3 Goodwill	006	871.672	871.672
4 Advances for the purchase of intangible assets	007
5 Intangible assets in preparation	008	914.121	3.201.979
6 Other intangible assets	009
II TANGIBLE ASSETS (ADP 011 to 019)	010	662.329.502	763.037.004
1 Land	011	129.883.886	191.747.172
2 Buildings 3 Plant and equipment	012 013	412.109.694 57.687.356	393.242.077 58.712.685
4 Tools, working inventory and transportation assets	014	14.412.117	18.247.601
5 Biological assets	015
6 Advances for the purchase of tangible assets	016	117.031	16.795.582
7 Tangible assets in preparation	017	41.738.408	78.616.314
8 Other tangible assets	018	6.032.708	5.354.928
9 Investment property	019	348.302	320.645
III FIXED FINANCIAL ASSETS (ADP 021 to 030)	020	18.469.932	19.823.570
1 Investments in holdings (shares) of undertakings within the group	021
2 Investments in other securities of undertakings within the group	022
3 Loans, deposits, etc. to undertakings within the group	023
4 Investments in holdings (shares) of companies linked by virtue of participating interests 5 Investment in other securities of companies linked by virtue of participating interests	024	16.254.440	16.895.432
6 Loans, deposits etc. to companies linked by virtue of participating interests	025 026	795.420	1.295.420
7 Investments in securities	027	135.827	224
8 Loans, deposits, etc. given	028	590.532	590.006
9 Other investments accounted for using the equity method	029
10 Other fixed financial assets	030	693.713	1.042.488
IV RECEIVABLES (ADP 032 to 035)	031
1 Receivables from undertakings within the group	032
2 Receivables from companies linked by virtue of participating interests	033
3 Customer receivables	034
4 Other receivables	035
V DEFERRED TAX ASSETS	036	40.120.445	39.706.746
C) CURRENT ASSETS (ADP 038+046+053+063) I INVENTORIES (ADP 039 to 045)	037 038	94.414.531 7.386.812	111.914.956 9.090.460
1 Raw materials and consumables	039	6.971.251	8.612.497
2 Work in progress	040
3 Finished goods	041
4 Merchandise	042	412.423	472.240
5 Advances for inventories	043	3.138	5.723
6 Fixed assets held for sale	044
7 Biological assets	045
II RECEIVABLES (ADP 047 to 052)	046	6.200.436	14.392.499
1 Receivables from undertakings within the group	047
2 Receivables from companies linked by virtue of participating interests 3 Customer receivables	048 049	1.373.496 2.436.265	247.722 7.953.322
4 Receivables from employees and members of the undertaking	050	109.278	2.399.407
5 Receivables from government and other institutions	051	1.942.981	3.197.920
6 Other receivables	052	338.416	594.128
III CURRENT FINANCIAL ASSETS (ADP 054 to 062)	053	25.641.924	37.885.431
1 Investments in holdings (shares) of undertakings within the group	054
2 Investments in other securities of undertakings within the group	055
3 Loans, deposits, etc. to undertakings within the group	056
4 Investments in holdings (shares) of companies linked by virtue of participating interests	057
5 Investment in other securities of companies linked by virtue of participating interests	058
6 Loans, deposits etc. to companies linked by virtue of participating interests	059
7 Investments in securities	060
8 Loans, deposits, etc. given 9 Other financial assets	061 062	24.035.528 1.606.396	37.540.264 345.167
IV CASH AT BANK AND IN HAND	063	55.185.359	50.546.566
D) PREPAID EXPENSES AND ACCRUED INCOME	064	3.763.787	10.741.050
E) TOTAL ASSETS (ADP 001+002+037+064)	065	826.211.231	952.536.415

F) OFF-BALANCE SHEET ITEMS 066 7.179.343 7.176.871

BALANCE SHEET (balance as at 30.09.2024) (continued) Submitter: Valamar Riviera d.d. in EUR

	ADP	Last day of the pre	At the reporting date
Item 1	code 2	ceding business year 3	of the current period 4
LIABILITIES
A) CAPITAL AND RESERVES (ADP 068 to 070+076+077+081+084+087)	067	446.821.035	488.345.037
I INITIAL (SUBSCRIBED) CAPITAL	068	221.915.350	221.915.350
II CAPITAL RESERVES	069	1.218.381	1.550.786
III RESERVES FROM PROFIT (ADP 071+072-073+074+075)	070	15.901.347	17.210.332
1 Legal reserves	071	11.095.768	11.095.768
2 Reserves for treasury shares	072	18.158.509	18.158.509
3 Treasury shares and holdings (deductible item)	073	-13.743.570	-12.043.945
4 Statutory reserves	074
5 Other reserves	075	390.640
IV REVALUATION RESERVES	076
V FAIR VALUE RESERVES AND OTHER (ADP 078 to 082)	077	39.878
1 Financial assets at fair value through other comprehensive income (i.e. available for sale)	078	39.878
2 Cash flow hedge - effective portion 3 Hedge of a net investment in a foreign operation - effective portion	079 080
4 Other fair value reserves	081
5 Exchange differences arising from the translation of foreign operations (consolidation)	082
VI RETAINED PROFIT OR LOSS BROUGHT FORWARD (ADP 084-085)	083	42.165.052	42.432.256
1 Retained profit	084	42.165.052	42.432.256
2 Loss brought forward	085
VII PROFIT OR LOSS FOR THE BUSINESS YEAR (ADP 087-088)	086	27.027.615	59.900.106
1 Profit for the business year	087	27.027.615	59.900.106
2 Loss for the business year	088
VIII MINORITY (NON-CONTROLLING) INTEREST	089	138.553.412	145.336.207
B) PROVISIONS (ADP 091 to 096)	090	8.330.408	6.931.168
1 Provisions for pensions, termination benefits and similar obligations	091	4.156.621	4.157.261
2 Provisions for tax liabilities	092
3 Provisions for ongoing legal cases	093	4.102.327	2.726.267
4 Provisions for renewal of natural resources	094
5 Provisions for warranty obligations	095
6 Other provisions	096	71.460	47.640
C) LONG-TERM LIABILITIES (ADP 098 to 108)	097	264.707.353	340.470.417
1 Liabilities to undertakings within the group	098
2 Liabilities for loans, deposits, etc. of undertakings within the group	099
3 Liabilities to companies linked by virtue of participating interests 4 Liabilities for loans, deposits etc. of companies linked by virtue of participating interests	100 101
5 Liabilities for loans, deposits etc.	102
6 Liabilities to banks and other financial institutions	103	244.200.777	260.327.427
7 Liabilities for advance payments	104
8 Liabilities to suppliers	105
9 Liabilities for securities	106
10 Other long-term liabilities	107	14.787.692	74.855.840
11 Deferred tax liability	108	5.718.884	5.287.150
D) SHORT-TERM LIABILITIES (ADP 110 to 123)	109	84.649.099	95.229.836
1 Liabilities to undertakings within the group	110
2 Liabilities for loans, deposits, etc. of undertakings within the group	111
3 Liabilities to companies linked by virtue of participating interests	112	31.800	18.381
4 Liabilities for loans, deposits etc. of companies linked by virtue of participating interests	113
5 Liabilities for loans, deposits etc.	114
6 Liabilities to banks and other financial institutions	115	49.774.765	13.564.895
7 Liabilities for advance payments	116	6.573.592	16.650.311
8 Liabilities to suppliers	117	16.924.444	31.035.251
9 Liabilities for securities	118
10 Liabilities to employees	119	4.789.942	9.444.197
11 Taxes, contributions and similar liabilities	120	4.624.581	20.034.018
12 Liabilities arising from the share in the result 13 Liabilities arising from fixed assets held for sale	121 122	49.388	49.388
14 Other short-term liabilities	123	1.880.587	4.433.395
E) ACCRUALS AND DEFERRED INCOME	124	21.703.336	21.559.957
F) TOTAL – LIABILITIES (ADP 067+090+097+109+124)	125	826.211.231	952.536.415
G) OFF-BALANCE SHEET ITEMS	126	7.179.343	7.176.871

STATEMENT OF PROFIT OR LOSS (for the period 01.01.2024 to 30.09.2024) Submitter: Valamar Riviera d.d. in EUR

		Same period		Current period
Item	code	of the previous year
1	2	Cummulative 3	Quarter 4	Cummulative 5	Quarter 6
I OPERATING INCOME (ADP 002 to 006)	001	347.824.634	242.530.653	390.104.554	267.810.841
1 Income from sales with undertakings within the group	002
2 Income from sales (outside group)	003	345.872.649	241.697.441	385.986.878	266.400.340
3 Income from the use of own products, goods and services	004	61.748	22.003	65.791	20.378
4 Other operating income with undertakings within the group	005
5 Other operating income (outside the group)	006	1.890.237	811.209	4.051.885	1.390.123
II OPERATING EXPENSES (ADP 008+009+013+017+018+019+022+029)	007	256.622.522	121.095.778	294.993.848	135.600.322
1 Changes in inventories of work in progress and finished goods	008
2 Material costs (ADP 010 to 012)	009	97.648.430	53.767.560	108.853.514	58.847.687
a) Costs of raw materials and consumables	010	61.475.723	33.774.646	65.787.179	35.376.328
b) Costs of goods sold	011	2.238.861	1.288.859	4.064.844	2.688.065
c) Other external costs	012	33.933.846	18.704.055	39.001.491	20.783.294
3 Staff costs (ADP 014 to 016)	013	82.323.326	37.434.332	95.016.268	43.279.772
a) Net salaries and wages	014	51.445.074	23.193.676	58.249.522	25.993.625
b) Tax and contributions from salary costs	015	20.107.899	9.286.222	24.250.579	11.517.436
c) Contributions on salaries	016	10.770.353	4.954.434	12.516.167	5.768.711
4 Depreciation	017	49.010.949	16.860.577	52.001.124	17.436.007
5 Other costs	018	25.631.875	11.678.015	35.215.927	14.504.954
6 Value adjustments (ADP 020+021)	019
a) fixed assets other than financial assets	020
b) current assets other than financial assets	021
7 Provisions (ADP 023 to 028)	022	4.485	4.485	1.286
a) Provisions for pensions, termination benefits and similar obligations	023	4.485	4.485	1.286
b) Provisions for tax liabilities	024
c) Provisions for ongoing legal cases	025
d) Provisions for renewal of natural resources	026
e) Provisions for warranty obligations	027
f) Other provisions	028
8 Other operating expenses III. FINANCIAL INCOME (ADP 031 to 040)	029 030	2.003.457 2.299.974	1.350.809 1.039.370	3.905.729 2.292.271	1.531.902 484.235
1 Income from investments in holdings (shares) of undertakings within the group	031
2 Income from investments in holdings (shares) of companies linked by
virtue of participating interests	032
3 Income from other long-term financial investment and loans granted to	033
undertakings within the group
4 Other interest income from operations with undertakings within the group	034
5 Exchange rate differences and other financial income from operations with undertakings within the group	035
6 Income from other long-term financial investments and loans	036
7 Other interest income	037	1.184.503	631.550	1.292.722	291.828
8 Exchange rate differences and other financial income	038	2.930	7.096
9 Unrealised gains (income) from financial assets	039	555.125	203.035	326.940
10 Other financial income	040	557.416	197.689	672.609	192.407
IV FINANCIAL EXPENSES (ADP 042 to 048)	041	7.587.037	2.527.216	12.648.888	4.240.254
1 Interest expenses and similar expenses with undertakings within the group	042
2 Exchange rate differences and other expenses from operations with	043
undertakings within the group
3 Interest expenses and similar expenses	044	6.668.309	2.156.502	11.220.583	2.772.870
4 Exchange rate differences and other expenses	045			3.000	1.302
5 Unrealised losses (expenses) from financial assets	046				999.520
6 Value adjustments of financial assets (net)	047
7 Other financial expenses V SHARE IN PROFIT FROM UNDERTAKINGS LINKED BY VRITUE OF	048	918.728	370.714	1.425.305	466.562
PARTICIPATING INTERESTS	049		186.722		271.656
VI SHARE IN PROFIT FROM JOINT VENTURES	050
VII SHARE IN LOSS OF COMPANIES LINKED BY VIRTUE OF PARTICIPATING INTEREST	051	46.753		46.127
VIII SHARE IN LOSS OF JOINT VENTURES	052
IX TOTAL INCOME (ADP 001+030+049+050)	053	350.124.608	243.756.745	392.396.825	268.566.732
X TOTAL EXPENDITURE (ADP 007+041+051+052)	054	264.256.312	123.622.994	307.688.863	139.840.576
XI PRE-TAX PROFIT OR LOSS (ADP 053-054)	055	85.868.296	120.133.751	84.707.962	128.726.156
1 Pre-tax profit (ADP 053-054)	056	85.868.296	120.133.751	84.707.962	128.726.156
2 Pre-tax loss (ADP 054-053)	057

STATEMENT OF PROFIT OR LOSS (for the period 01.01.2024 to 30.09.2024) (continued) Submitter: Valamar Riviera d.d. in EUR

Item	ADP code	Same period of the previous year		Current period
		Cummulative	Quarter	Cummulative	Quarter
1	2	3	4	5	6
XII INCOME TAX	058	10.089.486	19.563.011	12.354.705	20.465.228
XIII PROFIT OR LOSS FOR THE PERIOD (ADP 055-059)	059	75.778.810	100.570.740	72.353.257	108.260.928
1. Profit for the period (ADP 055-059)	060	75.778.810	100.570.740	72.353.257	108.260.928
2. Loss for the period (ADP 059-055)	061

DISCONTINUED OPERATIONS (to be filled in by undertakings subject to IFRS only with discontinued operations)

XIV PRE-TAX PROFIT OR LOSS OF DISCONTINUED OPERATIONS (ADP 063-064)	062
1 Pre-tax profit from discontinued operations	063
2 Pre-tax loss on discontinued operations	064
XV INCOME TAX OF DISCONTINUED OPERATIONS	065
1 Discontinued operations profit for the period (ADP 062-065)	066
2 Discontinued operations loss for the period (ADP 065-062)	067

TOTAL OPERATIONS (to be filled in only by undertakings subject to IFRS with discontinued operations)

XVI PRE-TAX PROFIT OR LOSS (ADP 055+062)	068
1 Pre-tax profit (ADP 068)	069
2 Pre-tax loss (ADP 068)	070
XVII INCOME TAX (ADP 058+065)	071
XVIII PROFIT OR LOSS FOR THE PERIOD (ADP 068-071)	072
1 Profit for the period (ADP 068-071)	073
2 Loss for the period (ADP 071-068)	074

APPENDIX to the P&L (to be filled in by undertakings that draw up consolidated annual financial statements)

XIX PROFIT OR LOSS FOR THE PERIOD (ADP 076+077)	075	75.778.810	100.570.740	72.353.257	108.260.928
1 Attributable to owners of the parent	076	64.968.544	88.059.882	59.900.106	92.282.329
2 Attributable to minority (non-controlling) interest	077	10.810.266	12.510.858	12.453.151	15.978.599

STATEMENT OF OTHER COMPRHENSIVE INCOME (to be filled in by undertakings subject to IFRS)

I PROFIT OR LOSS FOR THE PERIOD	078	75.778.810	100.570.740	72.353.257
II OTHER COMPREHENSIVE INCOME/LOSS BEFORE TAX (ADP 080+087)	079	-424	-5.179	-47.554
III ITEMS THAT WILL NOT BE RECLASSIFIED TO PROFIT OR LOSS (ADP 081 to 085)	080	-424	-5.179	-47.554
1 Changes in revaluation reserves of fixed tangible and intangible assets	081
2 Gains or losses from subsequent measurement of equity instruments at fair value through other comprehensive income	082	-424	-5.179	-47.554
3 Fair value changes of financial liabilities at fair value through statement of profit or loss, attributable to changes in their credit risk	083
4 Actuarial gains/losses on the defined benefit obligation	084
5 Other items that will not be reclassified	085
6 Income tax relating to items that will not be reclassified	086	-76	-931	-7.676
IV ITEMS THAT MAY BE RECLASSIFIED TO PROFIT OR LOSS (ADP 088 to 095)	087
1 Exchange rate differences from translation of foreign operations	088
2 Gains or losses from subsequent measurement of debt securities at fair value through other comprehensive income	089
3 Profit or loss arising from effective cash flow hedging	090
4 Profit or loss arising from effective hedge of a net investment in a foreign operation	091
5 Share in other comprehensive income/loss of companies linked by virtue of participating interests	092
6 Changes in fair value of the time value of option	093
7 Changes in fair value of forward elements of forward contracts	094
8 Other items that may be reclassified to profit or loss	095
9 Income tax relating to items that may be reclassified to profit or loss	096

STATEMENT OF PROFIT OR LOSS (for the period 01.01.2024 to 30.09.2024) (continued) Submitter: Valamar Riviera d.d. in EUR

Item		Same period of the previous year		Current period
		Cummulative	Quarter	Cummulative	Quarter
1	2	3	4	5	6
V NET OTHER COMPREHENSIVE INCOME OR LOSS (ADP 080+087- 086 - 096)	097	-348	-4.248	-39.878
VI COMPREHENSIVE INCOME OR LOSS FOR THE PERIOD (ADP 078+097)	098	75.778.462	100.566.492	72.313.379	108.260.928

APPENDIX to the Statement on comprehensive income (to be filled in by undertakings that draw up consolidated statements)

VII COMPREHENSIVE INCOME OR LOSS FOR THE PERIOD (ADP 100+101)	099	75.778.462	100.566.492	72.313.379	108.260.928
1 Attributable to owners of the parent	100	64.968.196	88.055.634	59.860.228	92.282.329
2 Attributable to minority (non-controlling) interest	101	10.810.266	12.510.858	12.453.151	15.978.599

STATEMENT OF CASH FLOWS - indirect method (for the period 01.01.2024 to 30.09.2024) Submitter: Valamar Riviera d.d. in EUR

	ADP	Same period of the	Current
Item	code	previous year	period
1	2	3	4
CASH FLOW FROM OPERATING ACTIVITIES
1 Pre-tax profit	001	85.868.296	84.707.962
2 Adjustments (ADP 003 to 010):	002	54.129.599	61.342.826
a) Depreciation	003	49.010.949	52.001.124
b) Gains and losses from sale and value adjustment of fixed tangible and intangible assets	004	-53.511	63.761
c) Gains and losses from sale and unrealised gains and losses and value adjustment of financial assets	005
d) Interest and dividend income	006	-1.185.025	-1.290.628
e) Interest expenses	007	6.770.148	11.322.507
f) Provisions	008	-294.685	-1.399.241
g) Exchange rate differences (unrealised)	009
h) Other adjustments for non-cash transactions and unrealised gains and losses	010	-118.277	645.303
I Cash flow increase or decrease before changes in working capital (ADP 001+002)	011	139.997.895	146.050.788
3 Changes in the working capital (ADP 013 to 016)	012	26.918.216	16.834.454
a) Increase or decrease in short-term liabilities	013	46.772.490	31.751.286
b) Increase or decrease in short-term receivables	014	-17.860.104	-13.213.184
c) Increase or decrease in inventories	015	-1.994.170	-1.703.648
d) Other increase or decrease in working capital	016
II Cash from operations (ADP 011+012)	017	166.916.111	162.885.242
4 Interest paid	018	-6.235.872	-8.091.220
5 Income tax paid	019	-846	-4.074.287
A) NET CASH FLOW FROM OPERATING ACTIVITIES (ADP 017 to 019)	020	160.679.393	150.719.735
CASH FLOW FROM INVESTMENT ACTIVITIES
1 Cash receipts from sales of fixed tangible and intangible assets	021	83.184	117.205
2 Cash receipts from sales of financial instruments	022	373.549	446.855
3 Interest received	023	892.296	1.499.707
4 Dividends received	024	2.160
5 Cash receipts from repayment of loans and deposits	025	1.772
6 Other cash receipts from investment activities	026
III Total cash receipts from investment activities (ADP 021 to 026)	027	1.352.961	2.063.767
1 Cash payments for the purchase of fixed tangible and intangible assets 2 Cash payments for the acquisition of financial instruments	028 029	-50.079.361	-88.310.299
3 Cash payments for loans and deposits for the period	030	-28.300.222	-13.900.000
4 Acquisition of a subsidiary, net of cash acquired	031
5 Other cash payments from investment activities	032	-1.413.600	-687.120
IV Total cash payments from investment activities (ADP 028 to 032)	033	-79.793.183	-102.897.419
B) NET CASH FLOW FROM INVESTMENT ACTIVITIES (ADP 027+033)	034	-78.440.222	-100.833.652
CASH FLOW FROM FINANCING ACTIVITIES
1 Cash receipts from the increase in initial (subscribed) capital	035
2 Cash receipts from the issue of equity financial instruments and debt financial instruments	036
3 Cash receipts from credit principals, loans and other borrowings	037	9.958.544	32.009.983
4 Other cash receipts from financing activities	038	336.793	370.286
V Total cash receipts from financing activities (ADP 035 to 038)	039	10.295.337	32.380.269
1 Cash payments for the repayment of credit principals, loans and other borrowings and debt financial instruments	040	-52.424.278	-52.217.789
2 Cash payments for dividends	041	-26.912.708	-32.739.429
3 Cash payments for finance lease	042	-4.073	-3.728
4 Cash payments for the redemption of treasury shares and decrease in initial (subscribed) capital	043	-637.393	-17.800
5 Other cash payments from financing activities	044	-572.231	-1.926.399
VI Total cash payments from financing activities (ADP 040 to 044)	045	-80.550.683	-86.905.145
C) NET CASH FLOW FROM FINANCING ACTIVITIES (ADP 039+045)	046	-70.255.346	-54.524.876
1 Unrealised exchange rate differences in respect of cash and cash equivalents	047
D) NET INCREASE OR DECREASE IN CASH FLOWS (ADP 020+034+046+047)	048	11.983.825	-4.638.793
E) CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE PERIOD	049	89.299.582	55.185.359
F) CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD (ADP 048+049)	050	101.283.407	50.546.566

STATEMENT OF CHANGES IN EQUITY (for the period 01.01.2024 to 30.09.2024) Submitter: Valamar Riviera d.d. in EUR

		Attributable to owners of the parent
Item	ADP code	Initial (subscribed) capital	Capital reserves	Legal reserves	Reserves for treasury shares	Treasury shares and holdings (deductible item)	Statutory reserves	Other reserves	Revaluation reserves	Fair value of financial assets through other comprehensive income (availa	Cash flow hedge - effective portion	Hedge of a net investment in a foreign operation - effective portion	Other fair value reserves	Exchange rate differences from transla tion of foreign operations	Retained profit / loss brought forward	Profit/loss for the business year	Total attributable to owners of the parent	Minority (non-con trolling) interest	Total capital and reserves
1	2	3	4	5	6	7	8	9	10	ble for sale) 11	12	13	14	15	16	17	18 (3 to 6 - 7 + 8 to 17)	19	20 (18+19)
Previous period
1 Balance on the first day of the previous business year	01	221.915.351			693.268 11.095.768 18.158.509 16.513.142			5.114.288		7.845					46.604.740	19.601.100		306.677.727 134.448.828 441.126.555
2 Changes in accounting policies	02
3 Correction of errors	03
4 Balance on the first day of the previous business year (restated) (ADP 01 to 03) 5 Profit/loss of the period	04 05	221.915.351			693.268 11.095.768 18.158.509 16.513.142			5.114.288		7.845					46.604.740	19.601.100 27.027.615	27.027.615	306.677.727 134.448.828 441.126.555 6.639.711	33.667.326
6 Exchange rate differences from translation of foreign operations	06
7 Changes in revaluation reserves of fixed tangible and intangible assets	07
8 Gains or losses from subsequent measurement of financial assets at fair value through other comprehensive income (available for sale) 9 Profit or loss arising from effective cash flow hedge	08 09									39.065							39.065		39.065
10 Profit or loss arising from effective hedge of a net investment in a foreign operation 11 Share in other comprehensive income/loss of companies linked by virtue of	10 11
participating interests 12 Actuarial gains/losses on the defined benefit obligation	12
13 Other changes in equity unrelated to owners	13
14 Tax on transactions recognised directly in equity	14									-7.032							-7.032		-7.032
15 Decrease in initial (subscribed) capital (other than arising from the pre bankruptcy settlement procedure or from the reinvestment of profit)	15	-1	1
16 Decrease in initial (subscribed) capital arising from the pre-bankruptcy settlement procedure	16
17 Decrease in initial (subscribed) capital arising from the reinvestment of profit	17
18 Redemption of treasury shares/holdings	18					1.772.315											-1.772.315		-1.772.315
19 Payments from members/shareholders	19
20 Payment of share in profit/dividend	20														-24.377.581		-24.377.581		-2.535.127 -26.912.708
21 Other distributions and payments to members/shareholders	21		525.112			-4.541.887		-4.723.648							336.793		680.144		680.144
22 Transfer to reserves according to the annual schedule	22															19.601.100 -19.601.100
23 Increase in reserves arising from the pre-bankruptcy settlement procedure	23
24 Balance on the last day of the previous business year reporting period (ADP 04 to 23)	24	221.915.350			1.218.381 11.095.768 18.158.509 13.743.570			390.640		39.878					42.165.052	27.027.615		308.267.623 138.553.412 446.821.035

APPENDIX TO THE STATEMENT OF CHANGES IN EQUITY (to be filled in by undertakings that draw up financial statements in accordance with the IFRS) I OTHER COMPREHENSIVE INCOME OF THE PREVIOUS PERIOD, NET OF TAX (ADP 06 to 14)	25									32.033							32.033		32.033
II COMPREHENSIVE INCOME OR LOSS FOR THE PREVIOUS PERIOD
(ADP 05+25)	26									32.033						27.027.615	27.059.648	6.639.711	33.699.359
III TRANSACTIONS WITH OWNERS IN THE PREVIOUS PERIOD RECOGNISED DIRECTLY IN EQUITY (ADP 15 to 23)	27	-1	525.113			-2.769.572		-4.723.648								-4.439.688 -19.601.100	-25.469.752	-2.535.127	-28.004.879
Current period
1 Balance on the first day of the previous business year	28	221.915.350			1.218.381 11.095.768 18.158.509 13.743.570			390.640		39.878					42.165.052	27.027.615		308.267.623 138.553.412 446.821.035
2 Changes in accounting policies	29
3 Correction of errors	30
4 Balance on the first day of the previous business year (restated) (ADP 28 to 30)	31	221.915.350			1.218.381 11.095.768 18.158.509 13.743.570			390.640		39.878					42.165.052	27.027.615		308.267.623 138.553.412 446.821.035
5 Profit/loss of the period	32															59.900.106	59.900.106	12.453.151	72.353.257
6 Exchange rate differences from translation of foreign operations	33
7 Changes in revaluation reserves of fixed tangible and intangible assets	34
8 Gains or losses from subsequent measurement of financial assets at fair value through other comprehensive income (available for sale)	35									-47.554					-61.624		-109.178		-109.178
9 Profit or loss arising from effective cash flow hedge	36
10 Profit or loss arising from effective hedge of a net investment in a foreign operation 11 Share in other comprehensive income/loss of companies linked by virtue of participating interests	37 38
12 Actuarial gains/losses on the defined benefit obligation	39
13 Other changes in equity unrelated to owners	40
14 Tax on transactions recognised directly in equity	41									7.676							7.676		7.676
15 Decrease in initial (subscribed) capital (other than arising from the pre	42
bankruptcy settlement procedure or from the reinvestment of profit) 16 Decrease in initial (subscribed) capital arising from the pre-bankruptcy settlement procedure	43
17 Decrease in initial (subscribed) capital arising from the reinvestment of profit	44
18 Redemption of treasury shares/holdings	45					17.800											-17.800		-17.800
19 Payments from members/shareholders	46
20 Payment of share in profit/dividend	47														-27.069.073		-27.069.073		-5.670.356 -32.739.429
21 Other distributions and payments to members/shareholders	48		332.405			-1.717.425		-390.640							370.286		2.029.476		2.029.476
22 Carryforward per annual plane	49															27.027.615 -27.027.615
23 Increase in reserves arising from the pre-bankruptcy settlement procedure	50
24 Balance on the last day of the previous business year reporting period (ADP 31 to 50)	51	221.915.350			1.550.786 11.095.768 18.158.509 12.043.945										42.432.256	59.900.106		343.008.830 145.336.207 488.345.037
APPENDIX TO THE STATEMENT OF CHANGES IN EQUITY (to be filled in by undertakings that draw up financial statements in accordance with the IFRS)
I OTHER COMPREHENSIVE INCOME FOR THE CURRENT PERIOD, NET OF TAX (ADP 33 to 41)	52									-39.878					-61.624		-101.502		-101.502
II COMPREHENSIVE INCOME OR LOSS FOR THE CURRENT PERIOD (ADP 32+52) III TRANSACTIONS WITH OWNERS IN THE CURRENT PERIOD RECOGNISED	53									-39.878					-61.624	59.900.106	59.798.604	12.453.151	72.251.755
DIRECTLY IN EQUITY (ADP 42 to 50)	54		332.405			-1.699.625		-390.640								328.828 -27.027.615	-25.057.397	-5.670.356	-30.727.753

NOTES TO FINANCIAL STATEMENTS - TFI

(drawn up for quarterly reporting periods)

Name of the issuer: Valamar Riviera d.d.

Personal identification number OIB: 36201212847

Reporting period: 01.01.2024 to 30.09.2024 Notes to financial statements for quarterly periods include:

a) explanation of business events relevant to understanding changes in the statement of financial position and financial performance for the reporting semi-annual period of the issuer with respect to the last business year: information is provided regarding these events and relevant information published in the last annual financial statement is updated (items 15 to 15C IAS 34 - Interim financial reporting)
b) information on the access to the latest annual financial statements, for the purpose of understanding information published in the notes to financial statements drawn up for the semi-annual reporting period
c) a statement explaining that the same accounting policies are applied while drawing up financial statements for the semi-annual reporting period as in the latest annual financial statements or, in the case where the accounting policies have changed, a description of the nature and effect of the changes (item 16.A (a) IAS 34 - Interim financial reporting)
d) a description of the financial performance in the case of the issuer whose business is seasonal (items 37 and 38 IAS 34 - Interim financial reporting)
e) other comments prescribed by IAS 34 Interim financial reporting
f) in the notes to quarterly periods financial statements, in addition to the information stated above, information in respect of the following matters shall be disclosed:
- 1. undertaking's name, registered office (address), legal form, country of establishment, entity's registration number and, if applicable, the indication whether the undertaking is undergoing liquidation, bankruptcy proceedings, shortened termination proceedings or extraordinary administration
- 1. adopted accounting policies (only an indication of whether there has been a change from the previous period)
- 3.the total amount of any financial commitments, guarantees or contingencies that are not included in the balance sheet, and an indication of the nature and form of any valuable security which has been provided; any commitments concerning pensions of the undertaking within the group or company linked by virtue of participating interest shall be disclosed separately
- 1. the amount and nature of individual items of income or expenditure which are of exceptional size or incidence
- 1. amounts owed by the undertaking and falling due after more than five years, as well as the total debts of the undertaking covered by valuable security furnished by the undertaking, specifying the type and form of security
- 1. average number of employees during the financial year
- 1. where, in accordance with the regulations, the undertaking capitalised on the cost of salaries in part or in full, information on the amount of the total cost of employees during the year broken down into the amount directly debiting the costs of the period and the amount capitalised on the value of the assets during the period, showing separately the total amount of net salaries and the amount of taxes, contributions from salaries and contributions on salaries
- 1. where a provision for deferred tax is recognised in the balance sheet, the deferred tax balances at the end of the financial year, and the movement in those balances during the financial year
- 1. the name and registered office of each of the undertakings in which the undertaking, either itself or through a person acting in their own name but on the undertaking's behalf, holds a participating interest, showing the proportion of the capital held, the amount of capital and reserves, and the profit or loss for the latest financial year of the undertaking concerned for which financial

NOTES TO FINANCIAL STATEMENTS - TFI (continued)

(drawn up for quarterly reporting periods)

statements have been adopted; the information concerning capital and reserves and the profit or loss may be omitted where the undertaking concerned does not publish its balance sheet and is not controlled by another undertaking

1. the number and the nominal value or, in the absence of a nominal value, the accounting par value of the shares subscribed during the financial year within the limits of the authorised capital
1. the existence of any participation certificates, convertible debentures, warrants, options or similar securities or rights, with an indication of their number and the rights they confer
1. the name, registered office and legal form of each of the undertakings of which the undertaking is a member having unlimited liability
1. the name and registered office of the undertaking which draws up the consolidated financial statements of the largest group of undertakings of which the undertaking forms part as a controlled group member
1. the name and registered office of the undertaking which draws up the consolidated financial statements of the smallest group of undertakings of which the undertaking forms part as a controlled group member and which is also included in the group of undertakings referred to in point 13
1. the place where copies of the consolidated financial statements referred to in points 13 and 14 may be obtained, provided that they are available
1. the nature and business purpose of the undertaking's arrangements that are not included in the balance sheet and the financial impact on the undertaking of those arrangements, provided that the risks or benefits arising from such arrangements are material and in so far as the disclosure of such risks or benefits is necessary for the purposes of assessing the financial position of the undertaking
1. the nature and the financial effect of material events arising after the balance sheet date which are not reflected in the profit and loss account or balance sheet

"Notes to financial statements for the three month period together with detailed information on financial performance and events relevant to understanding changes in financial statements are available in PDF document "Business results 1/1/2024 – 30/09/2024" which has been simultaneously published with this document on HANFA (Croatian Financial Services Supervisory Agency), Zagreb Stock Exchange and Issuers web pages.

Reporting period: from 01.01.2024 to 30.09.2024

Quarterly financial statements

Year:	2024
Quarter:	3
Registration number (MB):	3474771		Issuer's home Member State code:	HR
Entity's registration number (MBS):	40020883
Personal identification number (OIB):	36201212847	LEI:	529900DUWS1DGNEK4C68
Institution code:	30577
Name of the issuer:	Valamar Riviera d.d.
Postcode and town:	52440	Poreč
Street and house number:	Stancija Kaligari 1
E-mail address:	[email protected]
Web address:	www.valamar-riviera.com
Number of employees (end of the reporting period):	5048
Consolidated report:	KN	(KN-not consolidated/KD-consolidated)
Audited:	RN	(RN-not audited/RD-audited)
Names of subsidiaries (according to IFRS):	Registered office:		MB:
Bookkeeping firm:	No
Contact person:	Sopta Anka

Audit firm:

Certified auditor:

Telephone: 052 408 188

E-mail address: [email protected]

(name of the audit firm)

(name and surname)

(authorized representative's signature) L.S.

BALANCE SHEET (balance as at 30.09.2024) Submitter: Valamar Riviera d.d. in EUR

	ADP	Last day of the pre	At the reporting date
Item	code	ceding business year	of the current period
1 A) RECEIVABLES FOR SUBSCRIBED CAPITAL UNPAID	2 001	3	4
B) FIXED ASSETS (ADP 003+010+020+031+036)	002	597.799.951	682.912.846
I INTANGIBLE ASSETS (ADP 004 to 009)	003	6.565.018	6.846.046
1 Research and development	004
2 Concessions, patents, licences, trademarks, software and other rights	005	4.779.225	2.773.115
3 Goodwill	006	871.672	871.672
4 Advances for the purchase of intangible assets	007
5 Intangible assets in preparation	008	914.121	3.201.259
6 Other intangible assets	009
II TANGIBLE ASSETS (ADP 011 to 019)	010	446.642.084	530.198.834
1 Land 2 Buildings	011 012	70.644.262 287.897.269	127.735.957 270.426.301
3 Plant and equipment	013	38.770.695	39.123.658
4 Tools, working inventory and transportation assets	014	7.487.134	9.715.909
5 Biological assets	015
6 Advances for the purchase of tangible assets	016	69.958	16.632.765
7 Tangible assets in preparation	017	36.238.653	61.839.075
8 Other tangible assets	018	5.185.811	4.404.524
9 Investment property	019	348.302	320.645
III FIXED FINANCIAL ASSETS (ADP 021 to 030)	020	143.056.928	144.177.413
1 Investments in holdings (shares) of undertakings within the group	021	124.258.659	124.258.659
2 Investments in other securities of undertakings within the group	022
3 Loans, deposits, etc. to undertakings within the group	023
4 Investments in holdings (shares) of companies linked by virtue of participating interests	024	16.816.257	17.503.377
5 Investment in other securities of companies linked by virtue of participating interests	025
6 Loans, deposits etc. to companies linked by virtue of participating interests	026	795.420	1.295.420
7 Investments in securities 8 Loans, deposits, etc. given	027 028	135.603 590.532	0 590.005
9 Other investments accounted for using the equity method	029
10 Other fixed financial assets	030	460.457	529.952
IV RECEIVABLES (ADP 032 to 035)	031
1 Receivables from undertakings within the group	032
2 Receivables from companies linked by virtue of participating interests	033
3 Customer receivables	034
4 Other receivables	035
V DEFERRED TAX ASSETS	036	1.535.921	1.690.553
C) CURRENT ASSETS (ADP 038+046+053+063)	037	59.905.492	61.856.552
I INVENTORIES (ADP 039 to 045)	038	5.945.539	7.352.624
1 Raw materials and consumables	039	5.587.078	6.964.515
2 Work in progress 3 Finished goods	040 041
4 Merchandise	042	358.461	388.109
5 Advances for inventories	043
6 Fixed assets held for sale	044
7 Biological assets	045
II RECEIVABLES (ADP 047 to 052)	046	6.851.328	10.116.030
1 Receivables from undertakings within the group	047	2.340.631	2.125.334
2 Receivables from companies linked by virtue of participating interests	048	1.373.496	247.722
3 Customer receivables	049	1.909.335	3.729.653
4 Receivables from employees and members of the undertaking	050	88.956	2.140.705
5 Receivables from government and other institutions	051	893.990	1.613.015
6 Other receivables	052	244.920	259.601
III CURRENT FINANCIAL ASSETS (ADP 054 to 062)	053	821.086	281.432
1 Investments in holdings (shares) of undertakings within the group	054
2 Investments in other securities of undertakings within the group	055
3 Loans, deposits, etc. to undertakings within the group	056
4 Investments in holdings (shares) of companies linked by virtue of participating interests	057
5 Investment in other securities of companies linked by virtue of participating interests 6 Loans, deposits etc. to companies linked by virtue of participating interests	058 059
7 Investments in securities	060
8 Loans, deposits, etc. given	061	35.528	139.964
9 Other financial assets	062	785.558	141.468
IV CASH AT BANK AND IN HAND	063	46.287.539	44.106.466
D) PREPAID EXPENSES AND ACCRUED INCOME	064	2.611.402	8.727.659
E) TOTAL ASSETS (ADP 001+002+037+064)	065	660.316.845	753.497.057

F) OFF-BALANCE SHEET ITEMS 066 7.179.343 7.176.871

BALANCE SHEET (balance as at 30.09.2024) (continued) Submitter: Valamar Riviera d.d. in EUR

	ADP
Item	code	Last day of the preced ing business year	At the reporting date of the current period
1	2	3	4
LIABILITIES
A) CAPITAL AND RESERVES (ADP 068 to 070+076+077+081+084+087)	067	407.623.536	437.026.066
I INITIAL (SUBSCRIBED) CAPITAL	068	221.915.350	221.915.350
II CAPITAL RESERVES	069	1.283.035	1.615.440
III RESERVES FROM PROFIT (ADP 071+072-073+074+075)	070	15.901.347	17.210.332
1 Legal reserves	071	11.095.768	11.095.768
2 Reserves for treasury shares	072	18.158.509	18.158.509
3 Treasury shares and holdings (deductible item)	073	-13.743.570	-12.043.945
4 Statutory reserves	074
5 Other reserves	075	390.640
IV REVALUATION RESERVES	076
V FAIR VALUE RESERVES AND OTHER (ADP 078 to 082)	077	39.878
1 Financial assets at fair value through other comprehensive income (i.e. available for sale)	078	39.878
2 Cash flow hedge - effective portion	079
3 Hedge of a net investment in a foreign operation - effective portion 4 Other fair value reserves	080 081
5 Exchange differences arising from the translation of foreign operations (consolidation)	082
VI RETAINED PROFIT OR LOSS BROUGHT FORWARD (ADP 084-085)	083	143.538.707	141.723.515
1 Retained profit	084	143.538.707	141.723.515
2 Loss brought forward	085
VII PROFIT OR LOSS FOR THE BUSINESS YEAR (ADP 087-088)	086	24.945.219	54.561.429
1 Profit for the business year	087	24.945.219	54.561.429
2 Loss for the business year	088
VIII MINORITY (NON-CONTROLLING) INTEREST	089
B) PROVISIONS (ADP 091 to 096)	090	6.284.948	5.754.994
1 Provisions for pensions, termination benefits and similar obligations	091	3.342.017	3.342.656
2 Provisions for tax liabilities	092
3 Provisions for ongoing legal cases	093	2.942.931	2.412.338
4 Provisions for renewal of natural resources	094
5 Provisions for warranty obligations	095
6 Other provisions	096
C) LONG-TERM LIABILITIES (ADP 098 to 108)	097	166.870.642	221.935.637
1 Liabilities to undertakings within the group	098
2 Liabilities for loans, deposits, etc. of undertakings within the group	099
3 Liabilities to companies linked by virtue of participating interests	100
4 Liabilities for loans, deposits etc. of companies linked by virtue of participating interests	101
5 Liabilities for loans, deposits etc.	102
6 Liabilities to banks and other financial institutions	103	151.652.565	150.819.231
7 Liabilities for advance payments	104
8 Liabilities to suppliers	105
9 Liabilities for securities	106
10 Other long-term liabilities	107	13.789.397	69.781.964
11 Deferred tax liability	108	1.428.680	1.334.442
D) SHORT-TERM LIABILITIES (ADP 110 to 123)	109	61.443.224	72.127.501
1 Liabilities to undertakings within the group	110	48.042	386.744
2 Liabilities for loans, deposits, etc. of undertakings within the group	111
3 Liabilities to companies linked by virtue of participating interests	112	31.800	18.381
4 Liabilities for loans, deposits etc. of companies linked by virtue of participating interests	113
5 Liabilities for loans, deposits etc.	114
6 Liabilities to banks and other financial institutions	115	33.001.611	8.432.107
7 Liabilities for advance payments	116	5.060.911	11.189.786
8 Liabilities to suppliers	117	13.335.698	24.223.825
9 Liabilities for securities	118
10 Liabilities to employees	119	3.834.829	7.192.359
11 Taxes, contributions and similar liabilities	120	4.232.394	16.680.260
12 Liabilities arising from the share in the result 13 Liabilities arising from fixed assets held for sale	121 122
14 Other short-term liabilities	123	1.897.939	4.004.039
E) ACCRUALS AND DEFERRED INCOME	124	18.094.495	16.652.859
F) TOTAL – LIABILITIES (ADP 067+090+097+109+124)	125	660.316.845	753.497.057
G) OFF-BALANCE SHEET ITEMS	126	7.179.343	7.176.871

STATEMENT OF PROFIT OR LOSS (for the period 01.01.2024 to 30.09.2024) Submitter: Valamar Riviera d.d. in EUR

Item ADP code Same period of the previous year Current period Cummulative Quarter Cummulative Quarter 1 2 3 4 5 6 I OPERATING INCOME (ADP 002 to 006) 001 275.236.809 188.613.887 298.729.049 202.333.583 1 Income from sales with undertakings within the group 002 10.047.639 5.170.646 11.810.589 5.569.903 2 Income from sales (outside group) 003 263.489.970 182.754.536 284.305.932 196.390.988 3 Income from the use of own products, goods and services 004 60.275 21.469 60.513 19.961 4 Other operating income with undertakings within the group 005 130.721 25.844 154.433 22.107 5 Other operating income (outside the group) 006 1.508.204 641.392 2.397.582 330.624 II OPERATING EXPENSES (ADP 008+009+013+017+018+019+022+029) 007 201.435.842 93.657.965 229.784.920 104.568.051 1 Changes in inventories of work in progress and finished goods 008 2 Material costs (ADP 010 to 012) 009 77.960.154 42.374.959 87.636.893 47.042.176 a) Costs of raw materials and consumables 010 48.217.283 26.392.144 50.432.831 27.019.669 b) Costs of goods sold 011 2.145.105 1.217.277 3.958.794 2.610.083 c) Other external costs 012 27.597.766 14.765.538 33.245.268 17.412.424 3 Staff costs (ADP 014 to 016) 013 65.099.735 28.611.342 74.408.536 33.109.512 a) Net salaries and wages 014 40.601.097 17.714.910 45.537.884 19.873.313 b) Tax and contributions from salary costs 015 16.042.289 7.133.827 19.121.432 8.846.084 c) Contributions on salaries 016 8.456.349 3.762.605 9.749.220 4.390.115 4 Depreciation 017 35.427.243 12.029.938 36.906.242 12.437.940 5 Other costs 018 22.292.223 10.551.533 28.434.276 11.826.228 6 Value adjustments (ADP 020+021) 019 a) fixed assets other than financial assets 020 b) current assets other than financial assets 021 7 Provisions (ADP 023 to 028) 022 4.485 4.485 1.286 a) Provisions for pensions, termination benefits and similar obligations 023 4.485 4.485 1.286 b) Provisions for tax liabilities 024 c) Provisions for ongoing legal cases 025 d) Provisions for renewal of natural resources 026 e) Provisions for warranty obligations 027 f) Other provisions 028 8 Other operating expenses 029 652.002 85.708 2.397.687 152.195 III. FINANCIAL INCOME (ADP 031 to 040) 030 4.458.532 1.095.156 6.681.920 511.009 1 Income from investments in holdings (shares) of undertakings within the group 031 2.183.287 4.978.422 95.031 2 Income from investments in holdings (shares) of companies linked by virtue of participating interests ⁰³² 3 Income from other long-term financial investment and loans granted to undertakings within the group ⁰³³ 4 Other interest income from operations with undertakings within the group 034 5 Exchange rate differences and other financial income from operations with undertakings within the group ⁰³⁵ 136.667 43.733 47.137 6 Income from other long-term financial investments and loans 036 7 Other interest income 037 1.116.758 578.677 943.228 227.950 8 Exchange rate differences and other financial income 038 2.160 5.519 9 Unrealised gains (income) from financial assets 039 207.692 664 69.496 10 Other financial income 040 811.968 466.563 643.637 188.028 IV FINANCIAL EXPENSES (ADP 042 to 048) 041 4.714.190 1.459.545 9.026.911 2.368.449 1 Interest expenses and similar expenses with undertakings within the group 042 2 Exchange rate differences and other expenses from operations with undertakings within the group ⁰⁴³ 3 Interest expenses and similar expenses 044 3.944.572 1.205.999 8.310.479 1.846.006 4 Exchange rate differences and other expenses 045 1.375 1.694 1.083 5 Unrealised losses (expenses) from financial assets 046 343.973 6 Value adjustments of financial assets (net) 047 7 Other financial expenses 048 768.243 253.546 714.738 177.387 V SHARE IN PROFIT FROM UNDERTAKINGS LINKED BY VRITUE OF PARTICIPATING INTERESTS ⁰⁴⁹ VI SHARE IN PROFIT FROM JOINT VENTURES 050 VII SHARE IN LOSS OF COMPANIES LINKED BY VIRTUE OF PARTICIPATING INTEREST ⁰⁵¹ VIII SHARE IN LOSS OF JOINT VENTURES 052 IX TOTAL INCOME (ADP 001+030+049+050) 053 279.695.341 189.709.043 305.410.969 202.844.592 X TOTAL EXPENDITURE (ADP 007+041+051+052) 054 206.150.032 95.117.510 238.811.831 106.936.500 XI PRE-TAX PROFIT OR LOSS (ADP 053-054) 055 73.545.309 94.591.533 66.599.138 95.908.092 1 Pre-tax profit (ADP 053-054) 056 73.545.309 94.591.533 66.599.138 95.908.092 2 Pre-tax loss (ADP 054-053) 057

STATEMENT OF PROFIT OR LOSS (for the period 01.01.2024 to 30.09.2024) (continued) Submitter: Valamar Riviera d.d. in EUR

Item		Same period of the previous year		Current period
		Cummulative	Quarter	Cummulative	Quarter
1	2	3	4	5	6

XII INCOME TAX	058	15.274.309	17.185.874	12.037.709	17.281.029
XIII PROFIT OR LOSS FOR THE PERIOD (ADP 055-059)	059	58.271.000	77.405.659	54.561.429	78.627.063
1. Profit for the period (ADP 055-059)	060	58.271.000	77.405.659	54.561.429	78.627.063
2. Loss for the period (ADP 059-055)	061

DISCONTINUED OPERATIONS (to be filled in by undertakings subject to IFRS only with discontinued operations)

XIV PRE-TAX PROFIT OR LOSS OF DISCONTINUED OPERATIONS (ADP 063-064)	062
1 Pre-tax profit from discontinued operations	063
2 Pre-tax loss on discontinued operations	064
XV INCOME TAX OF DISCONTINUED OPERATIONS	065
1 Discontinued operations profit for the period (ADP 062-065)	066
2 Discontinued operations loss for the period (ADP 065-062)	067

TOTAL OPERATIONS (to be filled in only by undertakings subject to IFRS with discontinued operations)

XVI PRE-TAX PROFIT OR LOSS (ADP 055+062)	068
1 Pre-tax profit (ADP 068)	069
2 Pre-tax loss (ADP 068)	070
XVII INCOME TAX (ADP 058+065)	071
XVIII PROFIT OR LOSS FOR THE PERIOD (ADP 068-071)	072
1 Profit for the period (ADP 068-071)	073
2 Loss for the period (ADP 071-068)	074

APPENDIX to the P&L (to be filled in by undertakings that draw up consolidated annual financial statements)

XIX PROFIT OR LOSS FOR THE PERIOD (ADP 076+077)	075
1 Attributable to owners of the parent	076
2 Attributable to minority (non-controlling) interest	077

STATEMENT OF OTHER COMPRHENSIVE INCOME (to be filled in by undertakings subject to IFRS)

I PROFIT OR LOSS FOR THE PERIOD	078	58.271.000	77.405.659	54.561.429
II OTHER COMPREHENSIVE INCOME/LOSS BEFORE TAX (ADP 080 to 087)	079	-424	-5.179	-47.554
III ITEMS THAT WILL NOT BE RECLASSIFIED TO PROFIT OR LOSS (ADP 081 to 085)	080	-424	-5.179	-47.554
1 Changes in revaluation reserves of fixed tangible and intangible assets	081
2 Gains or losses from subsequent measurement of equity instruments at fair value through other comprehensive income	082	-424	-5.179	-47.554
3 Fair value changes of financial liabilities at fair value through statement of profit or loss, attributable to changes in their credit risk	083
4 Actuarial gains/losses on the defined benefit obligation	084
5 Other items that will not be reclassified	085
6 Income tax relating to items that will not be reclassified	086	-76	-931	-7.676
IV ITEMS THAT MAY BE RECLASSIFIED TO PROFIT OR LOSS (ADP 088 to 095)	087
1 Exchange rate differences from translation of foreign operations	088
2 Gains or losses from subsequent measurement of debt securities at fair value through other comprehensive income	089
3 Profit or loss arising from effective cash flow hedging	090
4 Profit or loss arising from effective hedge of a net investment in a foreign operation	091
5 Share in other comprehensive income/loss of companies linked by virtue of participating interests	092
6 Changes in fair value of the time value of option	093
7 Changes in fair value of forward elements of forward contracts	094
8 Other items that may be reclassified to profit or loss	095
9 Income tax relating to items that may be reclassified to profit or loss	096

STATEMENT OF PROFIT OR LOSS (for the period 01.01.2024 to 30.09.2024) (continued) Submitter: Valamar Riviera d.d. in EUR

Item	ADP code	Same period of the previous year		Current period
		Cummulative	Quarter	Cummulative	Quarter
1	2	3	4	5	6
V NET OTHER COMPREHENSIVE INCOME OR LOSS (ADP 080+087- 086 - 096)	097	-348	-4.248	-39.878
VI COMPREHENSIVE INCOME OR LOSS FOR THE PERIOD (ADP 078+097)	098	58.270.652	77.401.411	54.521.551	78.627.063

APPENDIX to the Statement on comprehensive income (to be filled in by undertakings that draw up consolidated statements)

VII COMPREHENSIVE INCOME OR LOSS FOR THE PERIOD (ADP 100+101)	099
1 Attributable to owners of the parent	100
2 Attributable to minority (non-controlling) interest	101

STATEMENT OF CASH FLOWS - indirect method (for the period 01.01.2024 to 30.09.2024) Submitter: Valamar Riviera d.d. in EUR

	ADP	Same period of the	Current
Item	code	previous year	period
1	2	3	4
CASH FLOW FROM OPERATING ACTIVITIES
1 Pre-tax profit	001	73.545.309	66.599.138
2 Adjustments (ADP 003 to 010):	002	35.704.579	39.079.683
a) Depreciation	003	35.427.243	36.906.242
b) Gains and losses from sale and value adjustment of fixed tangible and intangible assets	004	-41.254	64.495
c) Gains and losses from sale and unrealised gains and losses and value adjustment of financial assets	005
d) Interest and dividend income	006	-3.300.568	-5.919.556
e) Interest expenses	007	3.998.733	8.381.127
f) Provisions	008	-187.703	-529.953
g) Exchange rate differences (unrealised)	009
h) Other adjustments for non-cash transactions and unrealised gains and losses	010	-191.872	177.328
I Cash flow increase or decrease before changes in working capital (ADP 001+002)	011	109.249.888	105.678.821
3 Changes in the working capital (ADP 013 to 016)	012	19.714.046	9.542.252
a) Increase or decrease in short-term liabilities	013	35.172.050	15.161.250
b) Increase or decrease in short-term receivables	014	-13.822.935	-4.211.914
c) Increase or decrease in inventories	015	-1.635.069	-1.407.084
d) Other increase or decrease in working capital	016
II Cash from operations (ADP 011+012)	017	128.963.934	115.221.073
4 Interest paid	018	-3.603.817	-5.562.826
5 Income tax paid	019		-4.068.357
A) NET CASH FLOW FROM OPERATING ACTIVITIES (ADP 017 to 019)	020	125.360.117	105.589.890
CASH FLOW FROM INVESTMENT ACTIVITIES
1 Cash receipts from sales of fixed tangible and intangible assets	021	63.400	69.339
2 Cash receipts from sales of financial instruments	022	373.549	446.855
3 Interest received	023	824.551	928.798
4 Dividends received	024	2.185.447	4.978.422
5 Cash receipts from repayment of loans and deposits	025	1.772
6 Other cash receipts from investment activities	026	1.011.673
III Total cash receipts from investment activities (ADP 021 to 026)	027	4.460.392	6.423.414
1 Cash payments for the purchase of fixed tangible and intangible assets	028	-24.420.292	-59.035.368
2 Cash payments for the acquisition of financial instruments	029
3 Cash payments for loans and deposits for the period	030	-222	-500.000
4 Acquisition of a subsidiary, net of cash acquired	031
5 Other cash payments from investment activities	032	-1.413.600	-687.120
IV Total cash payments from investment activities (ADP 028 to 032)	033	-25.834.114	-60.222.488
B) NET CASH FLOW FROM INVESTMENT ACTIVITIES (ADP 027+033)	034	-21.373.722	-53.799.074
CASH FLOW FROM FINANCING ACTIVITIES
1 Cash receipts from the increase in initial (subscribed) capital 2 Cash receipts from the issue of equity financial instruments and debt financial	035 036
instruments
3 Cash receipts from credit principals, loans and other borrowings	037		15.000.000
4 Other cash receipts from financing activities	038	800.974	370.286
V Total cash receipts from financing activities (ADP 035 to 038)	039	800.974	15.370.286
1 Cash payments for the repayment of credit principals, loans and other borrowings and debt financial instruments	040	-39.185.001	-40.277.708
2 Cash payments for dividends	041	-24.377.582	-27.069.073
3 Cash payments for finance lease	042
4 Cash payments for the redemption of treasury shares and decrease in initial (subscribed) capital	043	-637.393	-17.800
5 Other cash payments from financing activities	044	-607.203	-1.977.594
VI Total cash payments from financing activities (ADP 040 to 044)	045	-64.807.179	-69.342.175
C) NET CASH FLOW FROM FINANCING ACTIVITIES (ADP 039+045)	046	-64.006.205	-53.971.889
1 Unrealised exchange rate differences in respect of cash and cash equivalents	047
D) NET INCREASE OR DECREASE IN CASH FLOWS (ADP 020+034+046+047)	048	39.980.190	-2.181.073
E) CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE PERIOD F) CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD (ADP 048+049)	049 050	59.268.472 99.248.662	46.287.539 44.106.466

STATEMENT OF CHANGES IN EQUITY (for the period 01.01.2024 to 30.09.2024) Submitter: Valamar Riviera d.d. in EUR

										Attributable to owners of the parent
Item	ADP code	Initial (subscribed) capital	Capital reserves	Legal reserves	Reserves for treasury shares	Treasury shares and holdings (deductible item)	Statutory reserves	Other reserves	Revaluation reserves	Fair value of financial assets through other comprehensive income (availa ble for sale)	Cash flow hedge - effective portion	Hedge of a net investment in a foreign operation - effective portion	Other fair value reserves	Exchange rate differences from transla tion of foreign operations	Retained profit / loss brought forward	Profit/loss for the business year	Total attributable to owners of the parent	Minority (non-con trolling) interest	Total capital and reserves
1	2	3	4	5	6	7	8	9	10	11	12	13	14	15	16	17	18 (3 to 6 - 7 + 8 to 17)	19	20 (18+19)
Previous period
1 Balance on the first day of the previous business year	01	221.915.351			757.922 11.095.768 18.158.509 16.513.142			5.114.288		7.845					93.163.896	74.415.600	408.116.037		408.116.037
2 Changes in accounting policies	02
3 Correction of errors 4 Balance on the first day of the previous business year (restated) (ADP 01 to 03)	03 04	221.915.351			757.922 11.095.768 18.158.509 16.513.142			5.114.288		7.845					93.163.896	74.415.600	408.116.037		408.116.037
5 Profit/loss of the period	05															24.945.219	24.945.219		24.945.219
6 Exchange rate differences from translation of foreign operations	06
7 Changes in revaluation reserves of fixed tangible and intangible assets 8 Gains or losses from subsequent measurement of financial assets at fair value	07
through other comprehensive income (available for sale)	08									39.065							39.065		39.065
9 Profit or loss arising from effective cash flow hedge	09
10 Profit or loss arising from effective hedge of a net investment in a foreign operation 11 Share in other comprehensive income/loss of companies linked by virtue of participating interests	10 11
12 Actuarial gains/losses on the defined benefit obligation	12
13 Other changes in equity unrelated to owners	13
14 Tax on transactions recognised directly in equity 15 Decrease in initial (subscribed) capital (other than arising from the pre	14									-7.032							-7.032		-7.032
bankruptcy settlement procedure or from the reinvestment of profit)	15	-1	1
16 Decrease in initial (subscribed) capital arising from the pre-bankruptcy settlement procedure	16
17 Decrease in initial (subscribed) capital arising from the reinvestment of profit	17
18 Redemption of treasury shares/holdings	18					1.772.315											-1.772.315		-1.772.315
19 Payments from members/shareholders 20 Payment of share in profit/dividend	19 20														-24.377.582		-24.377.582		-24.377.582
21 Other distributions and payments to members/shareholders	21		525.112			-4.541.887		-4.723.648							336.793		680.144		680.144
22 Transfer to reserves according to the annual schedule	22															74.415.600 -74.415.600
23 Increase in reserves arising from the pre-bankruptcy settlement procedure 24 Balance on the last day of the previous business year reporting period	23
(ADP 04 to 23)	24	221.915.350			1.283.035 11.095.768 18.158.509 13.743.570			390.640		39.878					143.538.707	24.945.219	407.623.536		407.623.536
APPENDIX TO THE STATEMENT OF CHANGES IN EQUITY (to be filled in by undertakings that draw up financial statements in accordance with the IFRS)
I OTHER COMPREHENSIVE INCOME OF THE PREVIOUS PERIOD, NET OF TAX (ADP 06 to 14) II COMPREHENSIVE INCOME OR LOSS FOR THE PREVIOUS PERIOD	25									32.033							32.033		32.033
(ADP 05+25)	26									32.033						24.945.219	24.977.252		24.977.252
III TRANSACTIONS WITH OWNERS IN THE PREVIOUS PERIOD RECOGNISED DIRECTLY IN EQUITY (ADP 15 to 23)	27	-1	525.113			-2.769.572		-4.723.648								50.374.811 -74.415.600	-25.469.753		-25.469.753
Current period
1 Balance on the first day of the previous business year	28	221.915.350			1.283.035 11.095.768 18.158.509 13.743.570			390.640		39.878					143.538.707	24.945.219	407.623.536		407.623.536
2 Changes in accounting policies 3 Correction of errors	29 30
4 Balance on the first day of the previous business year (restated) (ADP 28 to 30)	31	221.915.350			1.283.035 11.095.768 18.158.509 13.743.570			390.640		39.878					143.538.707	24.945.219	407.623.536		407.623.536
5 Profit/loss of the period	32															54.561.429	54.561.429		54.561.429
6 Exchange rate differences from translation of foreign operations 7 Changes in revaluation reserves of fixed tangible and intangible assets	33 34
8 Gains or losses from subsequent measurement of financial assets at fair value	35									-47.554					-61.624		-109.178		-109.178
through other comprehensive income (available for sale) 9 Profit or loss arising from effective cash flow hedge	36
10 Profit or loss arising from effective hedge of a net investment in a foreign operation	37
11 Share in other comprehensive income/loss of companies linked by virtue of participating interests	38
12 Actuarial gains/losses on the defined benefit obligation	39
13 Other changes in equity unrelated to owners	40
14 Tax on transactions recognised directly in equity	41									7.676							7.676		7.676
15 Decrease in initial (subscribed) capital (other than arising from the pre bankruptcy settlement procedure or from the reinvestment of profit)	42
16 Decrease in initial (subscribed) capital arising from the pre-bankruptcy settlement procedure	43
17 Decrease in initial (subscribed) capital arising from the reinvestment of profit	44
18 Redemption of treasury shares/holdings	45					17.800											-17.800		-17.800
19 Payments from members/shareholders 20 Payment of share in profit/dividend	46 47														-27.069.073		-27.069.073		-27.069.073
21 Other distributions and payments to members/shareholders	48		332.405			-1.717.425		-390.640							370.286		2.029.476		2.029.476
22 Carryforward per annual plane	49															24.945.219 -24.945.219
23 Increase in reserves arising from the pre-bankruptcy settlement procedure	50
24 Balance on the last day of the previous business year reporting period (ADP 31 to 50)	51	221.915.350			1.615.440 11.095.768 18.158.509 12.043.945										141.723.515	54.561.429	437.026.066		437.026.066
APPENDIX TO THE STATEMENT OF CHANGES IN EQUITY (to be filled in by undertakings that draw up financial statements in accordance with the IFRS)
I OTHER COMPREHENSIVE INCOME FOR THE CURRENT PERIOD, NET OF TAX (ADP 33 to 41)	52									-39.878					-61.624		-101.502		-101.502
II COMPREHENSIVE INCOME OR LOSS FOR THE CURRENT PERIOD (ADP 32+52) III TRANSACTIONS WITH OWNERS IN THE CURRENT PERIOD RECOGNISED	53									-39.878					-61.624	54.561.429	54.459.927		54.459.927
DIRECTLY IN EQUITY (ADP 42 to 50)	54		332.405			-1.699.625		-390.640								-1.753.568 -24.945.219	-25.057.397		-25.057.397

NOTES TO FINANCIAL STATEMENTS - TFI

(drawn up for quarterly reporting periods)

Name of the issuer: Valamar Riviera d.d.

Personal identification number OIB: 36201212847

Reporting period: 01.01.2024 to 30.09.2024 Notes to financial statements for quarterly periods include:

a) explanation of business events relevant to understanding changes in the statement of financial position and financial performance for the reporting semi-annual period of the issuer with respect to the last business year: information is provided regarding these events and relevant information published in the last annual financial statement is updated (items 15 to 15C IAS 34 - Interim financial reporting)
b) information on the access to the latest annual financial statements, for the purpose of understanding information published in the notes to financial statements drawn up for the semi-annual reporting period
c) a statement explaining that the same accounting policies are applied while drawing up financial statements for the semi-annual reporting period as in the latest annual financial statements or, in the case where the accounting policies have changed, a description of the nature and effect of the changes (item 16.A (a) IAS 34 - Interim financial reporting)
d) a description of the financial performance in the case of the issuer whose business is seasonal (items 37 and 38 IAS 34 - Interim financial reporting)
e) other comments prescribed by IAS 34 Interim financial reporting
f) in the notes to quarterly periods financial statements, in addition to the information stated above, information in respect of the following matters shall be disclosed:
- 1. undertaking's name, registered office (address), legal form, country of establishment, entity's registration number and, if applicable, the indication whether the undertaking is undergoing liquidation, bankruptcy proceedings, shortened termination proceedings or extraordinary administration
- 1. adopted accounting policies (only an indication of whether there has been a change from the previous period)
- 3.the total amount of any financial commitments, guarantees or contingencies that are not included in the balance sheet, and an indication of the nature and form of any valuable security which has been provided; any commitments concerning pensions of the undertaking within the group or company linked by virtue of participating interest shall be disclosed separately
- 1. the amount and nature of individual items of income or expenditure which are of exceptional size or incidence
- 1. amounts owed by the undertaking and falling due after more than five years, as well as the total debts of the undertaking covered by valuable security furnished by the undertaking, specifying the type and form of security
- 1. average number of employees during the financial year
- 1. where, in accordance with the regulations, the undertaking capitalised on the cost of salaries in part or in full, information on the amount of the total cost of employees during the year broken down into the amount directly debiting the costs of the period and the amount capitalised on the value of the assets during the period, showing separately the total amount of net salaries and the amount of taxes, contributions from salaries and contributions on salaries
- 1. where a provision for deferred tax is recognised in the balance sheet, the deferred tax balances at the end of the financial year, and the movement in those balances during the financial year
- 1. the name and registered office of each of the undertakings in which the undertaking, either itself or through a person acting in their own name but on the undertaking's behalf, holds a participating interest, showing the proportion of the capital held, the amount of capital and reserves, and the profit or loss for the latest financial year of the undertaking concerned for which financial

NOTES TO FINANCIAL STATEMENTS - TFI (continued)

(drawn up for quarterly reporting periods)

1. the number and the nominal value or, in the absence of a nominal value, the accounting par value of the shares subscribed during the financial year within the limits of the authorised capital
1. the existence of any participation certificates, convertible debentures, warrants, options or similar securities or rights, with an indication of their number and the rights they confer
1. the name, registered office and legal form of each of the undertakings of which the undertaking is a member having unlimited liability
1. the name and registered office of the undertaking which draws up the consolidated financial statements of the largest group of undertakings of which the undertaking forms part as a controlled group member
1. the name and registered office of the undertaking which draws up the consolidated financial statements of the smallest group of undertakings of which the undertaking forms part as a controlled group member and which is also included in the group of undertakings referred to in point 13
1. the place where copies of the consolidated financial statements referred to in points 13 and 14 may be obtained, provided that they are available
1. the nature and business purpose of the undertaking's arrangements that are not included in the balance sheet and the financial impact on the undertaking of those arrangements, provided that the risks or benefits arising from such arrangements are material and in so far as the disclosure of such risks or benefits is necessary for the purposes of assessing the financial position of the undertaking
1. the nature and the financial effect of material events arising after the balance sheet date which are not reflected in the profit and loss account or balance sheet

NOTES TO FINANCIAL STATEMENTS FOR THE NINE-MONTH PERIOD ENDED 30 SEPTEMBER 2024

NOTE 1 – GENERAL INFORMATION

Valamar Riviera d.d., Poreč ("the Company") has been established and registered in accordance with Croatian laws and regulations. The Company is registered with the Commercial Court in Pazin. The principle activity of the Company is the provision of accommodation in hotels, resorts and campsites, food preparation and catering services as well as the preparation and serving of beverages. Company's business is of seasonal character. Company's registration number (MBS) is: 040020883, while the Company's personal identification number (OIB) is: 36201212847. The registered office of Valamar Riviera d.d. is in Poreč, Stancija Kaligari 1.

Company's share capital amounts to EUR 221,915,350 and comprises 126,027,542 ordinary shares with no prescribed nominal value. In accordance with the provisions of the Act on the euro introduction as the official currency in the Republic of Croatia and the Act on Amendments to the Companies Act, and based on the decision of the General Assembly on the adjustment of the share capital from April 24, 2023, the share capital of the Company, applying the fixed conversion rate was converted into euros.

The Company's shares were listed on the Prime market of the Zagreb Stock Exchange d.d., and were traded in 2024 in accordance with the relevant regulations on the organized market.

Valamar Riviera Group consists of Valamar Riviera, joint-stock company for tourism services, Poreč (the Parent Company) and its subsidiaries (the Group) as follows:

Magične stijene d.o.o., Dubrovnik, 100% ownership, until August 3, 2023, when the company Magične stijene d.o.o. was deleted from the court register;
Bugenvilia d.o.o., Dubrovnik, 100% ownership;
Imperial Riviera d.d., Rab, 46.27% ownership with the subsidiary Praona d.o.o., Makarska.

Associates companies are:

Helios Faros d.d., Stari Grad, 20% ownership;
Valamar A GmbH, Vienna, Austria, 24.54% ownership with subsidiaries WBVR

Beteiligungs GmbH, Vienna, Austria, Valamar Marietta GmbH, Obertauern, Austria, ContiEstates AG, Zug, Switzerland until 28 September 2022 when it was merged with Valamar Marietta GmbH, Obertauern, Austria, Kesselspitze GmbH, Obertauern, Austria and Kesselspitze GmbH & Co KG, Obertauern, Austria;

Valamar Obertauern GmbH, Obertauern, 10% direct ownership and 22.08% indirect ownership.

At the General Assembly of the Company Helios Faros d.d. held on 12 October 2023 the Decision on increasing the share capital by issuing new shares with stakes in cash with partial exclusion of priority rights for existing shareholders was made by investor PBZ Croatia Osiguranje d.d. in the total amount of EUR 6,435,303 for 4,838,574 shares and Valamar Riviera d.d. in the amount of EUR 1,608,825 for 1,209,643 shares.

In 2024 according to the decision of the shareholders of Valamar A GmbH, the company's capital reserves have increased by a total of EUR 2,800,000 in proportion to the following business shares: Wurmböck Beteiligungs GmbH in the amount of EUR 2,112,880 and Valamar Riviera d.d. in the amount of EUR 687,120.

On 18 June 2024 the Company's Supervisory Board approved the granting of a subordinated loan to Valamar A GmbH in the amount of EUR 1,600,000 from the Company Valamar Riviera d.d. of which a payment of EUR 500,000 was made in the third quarter of 2024. Another participate of the Valamar A GmbH Group, Wurmböck Beteiligungs GmbH will participate in the subordinated loan with the amount of EUR 1,600,000.

According to the decision of the General Assembly on 24 April 2024, the company paid a dividend in the amount of EUR 0.22 per share, in the total amount of EUR 27,068 thousand.

The consolidated and unconsolidated financial statements for the nine-month period ended 30 September 2024 were approved by the Management Board on 24 October 2024.

NOTE 2 – SUMMARY OF MATERIAL INFORMATION ON THE ACCOUNTING POLICIES AND ESTIMATES

2.1 Basis of preparation

The Company's and Group's financial statements for the nine-month period ended 30 September 2024 have been prepared in accordance with International Accounting Standard (IAS) 34 – Interim Financial Reporting. The financial statements have been prepared under the historical cost method, except for the financial assets at fair value through profit or loss and financial assets. The consolidated and unconsolidated financial statements for the nine-month period do not include all the information and disclosures required in the annual financial statements, and should be read in conjunction with the Company's and Group's annual financial statements as at 31 December 2023 which are available on HANFA (Croatian Financial Services Supervisory Agency), Zagreb Stock Exchange and Company's web page.

2.2 Going concern

Company's and Group's nine-month period financial statements have been prepared on a going concern basis. Based on current expectations Management believes that the geopolitical situation will not have a significant negative impact on the Company's and Group's ability to fulfil its obligations nor prolonged impact on Company's and Group's revenues and overall business which can affect the Company's and Group's ability to continue as a going concern in the foreseeable future.

2.3 Significant accounting policies

The accounting policies adopted in the preparation of the financial statements for the nine-month period ended 30 September 2024 are consistent with those followed in the preparation of the Company's and Group's annual financial statements for the year ended 31 December 2023.

2.4 Critical accounting estimates

During the preparation of the financial statements for the nine-month year period ended 30 September, 2024, there were no changes in the key accounting estimates compared to the estimates used in the preparation of the annual financial statements for the year ended 31 December 2023.

The Company and the Group, as the lessees as regards the tourist land

Due to the transition from public to private ownership, e.g. in the transformation and privatisation process and the fact that the properties of the Company and the Group that were used in the transformation process were appraised in the share capital of the Company, and a part was not appraised, there are certain ambiguities and proceedings regarding the ownership of a part of the land within the majority of tourist companies, as well as Company and the Group. According to the Act on Tourist and Other Construction Land not appraised in the transformation and privatisation process ("the ZOTZ"), which entered into force on August 1, 2010, a concession fee for the use of tourist land with an area of 3.29 mn m2 was calculated for the Company and 3.47 mn m2 for the Group. With the entry into force of the Act on unappraised land ("the ZNGZ") on May 2, 2020, the ZOTZ ceased to be valid.

The ZNGZ prescribes the obligation to determine and form buildings on appraised parts of campsites, hotels, tourist resorts and other construction land as ownership of the Company and the Group and buildings on unappraised parts of campsites, hotels, tourist resorts and other construction land as ownership of Republic of Croatia or local governments. For parts of a land owned by the Republic of Croatia or local governments, the Company and the Group will enter into lease agreements for a period of 50 years.

From the entry into force of the ZNGZ until the day of signing the lease agreement, the rent will be paid according to the area of the tourist land for which the concession fee has been calculated based on the ZOTZ, in the amount of 50% of the fee until the final resolution of property legal relations. The unit amount of rent and the method and terms of payment is determinated by Regulations from Government.

On February 8, 2024, the Government of the Republic of Croatia adopted two Regulations on tourist lands: (1) the Regulation on the method of determining the unit of lease for

NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES / CONTINUED

tourist land on which the hotel has been built and the tourist estate, the method of calculation for lease and other fees and mandatory content of the lease agreement and (2) the Regulation on determining the initial amount of the unit price of the lease for the tourist land in camp, the method of calculation of lease and other fees and mandatory content of the lease agreement (hereinafter: the Regulations).

After the adopted Regulations, the Company and the Group revised the areas of tourist land and determinated that the Company will use 2.6 mn m2 and the Group will use 2.8 mn m2.

The accounting treatment of leases by lessees, including the rent of tourist land according to the provisions of the ZNGZ, should be viewed in the context of provisions of IFRS 16 Leases. However, when analyzing the effects of the Act and Regulations and the actual application of the relevant standard, significant evaluations of the criteria for the application of IFRS 16 are required.

According to the Regulations lease fees are determined as an indexed unit price per

square meter up to a maximum of 4% of the tourist facility income of the previous period. The Company and the Group made detailed analysis of fees for each individual tourist facility.

For tourist facilities for which it is estimated that the variable income limit will be reached in most years, the payments are considered variable and as such are excluded from the lease liability, i.e. the criteria for applying IFRS 16 are not met. Variable lease payments are recognized in the statement of comprehensive income for the period.

For tourist facilities for which the variable income threshold is estimated to be unlikely (very low probability) to ever be exceeded, the payments are basically fixed and the indexed unit price per square meter is included in the calculation of the rental obligation.

According to the prescribed unit rent prices from the Regulations and the determinated discount rate of 5.42% to 7.96% for the Group, an assessment of the value of assets and liabilities with the right of use was carried out in accordance with IFRS 16 on January 1, 2024 and amounts to EUR 58 mn for the Company and EUR 63 mn for the Group.

NOTE 3 – FINANCIAL RISK MANAGEMENT

3.1 Financial risk factors

In their day-to-day business activities, the Company and the Group face a number of financial risks, especially market risk (including currency risk, interest rate risk and price risk), credit risk and liquidity risk. The Company and the Group have a proactive approach in mitigating the interest rate risks by using available market instruments. Internal risk management goals and policies aim at protecting partial interest hedging of the principal loan amount.

3.2 Capital management

The Company's and Group's objectives when managing capital are to safeguard the Company's and Group's ability to continue as a going concern in order to provide returns for the owner and to maintain an optimum capital structure to reduce the cost of capital.

3.3 Fair value estimation

The fair value of financial instruments traded in active markets is based on quoted market prices at the reporting date. The quoted market price used for financial assets held by the Company and the Group is the current bid price. The fair value of financial instruments that are not traded in the active market is determined by using valuation techniques. The Company and the Group use a variety of methods and make assumptions that are based on market conditions existing at each reporting date.

The carrying value less impairment provision of trade receivables and payables are assumed to approximate their fair values.

Quoted market prices for similar instruments are used for long-term debt. The fair value of financial liabilities for disclosure purposes is estimated by discounting the future contractual cash flows at the current market interest rate that is available to the Company and the Group for similar financial instruments.

Fair value hierarchy

IFRS 13 specifies a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources; unobservable inputs reflect the Company's market assumptions. These two types of inputs have created the following fair value hierarchy:

Level 1 Quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2 Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices).
Level 3 Inputs for the asset or liability that are not based on observable market data (unobservable inputs).

NOTE 3 – FINANCIAL RISK MANAGEMENT / CONTINUED

The following table presents assets measured at fair value as at:

GROUP
(in thousands of EUR)	Level 1	Level 2	Level 3	Total
As at 31 December 2023
Assets measured at fair value
Financial assets - equity securities	158	-	-	158
Derivative financial instruments	-	2,282	-	2,282
Total assets measured at fair value	158	2,282	-	2,440
As at 30 September 2024
Assets measured at fair value
Financial assets - equity securities	-	23	-	23
Derivative financial instruments	-	1,369	-	1,369
Total assets measured at fair value	-	1,392	-	1,392
Liabilities at fair value
Derivative financial instruments	-	84	-	84
Total liabilities measured at fair value	-	84	-	84
COMPANY
(in thousands of EUR)	Level 1	Level 2	Level 3	Total
As at 31 December 2023
Assets measured at fair value
Financial assets - equity securities	154	-	-	154
Derivative financial instruments	-	1,227	-	1,227
Total assets measured at fair value	154	1,227	-	1,381
As at 30 September 2024
Assets measured at fair value
Financial assets - equity securities	-	19	-	19
Derivative financial instruments	-	653	-	653
Total assets measured at fair value	-	672	-	672

NOTE 4 – SEGMENT INFORMATION

Following the management approach of IFRS 8, operating segments are reported in accordance with the internal reporting provided to the Group's Management (the chief operating decision-makers) who are responsible for allocating resources to the reportable segments and assessing its performance.

The Group records operating revenues and expenses by types of services rendered in three basic segments: hotels and apartments, camping and other business segments.

Revenue was divided between segments according to the organizational principle, where all of the income generated from camping profit centres was reported in the camping segment, and all of the income generated from hotel and apartment profit centres was reported in that segment. Other business segments include revenue from laundry services, other rentals of properties, revenue generated from the central services and central kitchens, revenue from retail, agency revenue and revenue from the accommodation of employees.

The segment information related to reportable segments for the nine-month period ended 30 September 2023 is as follows:

GROUP
(in thousands of EUR)	Hotels and apartments	Campsites	Other business segments	Total
Revenue from segments	225,195	108,300	37,048	370,543
Inter-segment revenue	(965)	(66)	(23,639)	(24,670)
Sales revenue	224,230	108,234	13,409	345,873

Depreciation and amortisation	29.830	13,184	5,996	49,010
Net finance income/(expense)	(4.878)	(1,049)	640	(5,287)
Write-off of fixed assets	8	3	4	15
Profit/(loss) of segment	116,334	74,277	(42,197)	148,414

All hotels, apartments and camps (operating assets) are located in the Republic of Croatia.

The segment information related to reportable segments for the nine-month period ended 30 September 2024 is as follows:

GROUP

(in thousands of EUR)	Hotels and apartments	Campsites	Other business segments	Total
Revenue from segments	255,975	112,515	45,784	414,274
Inter-segment revenue	(1,195)	(94)	(26,999)	(28,288)
Sales revenue	247,780	112,421	18,785	385,986

Depreciation and amortisation	30,601	14,323	7,077	52,001
Net finance income/(expense)	(5,747)	(2,932)	(1,678)	(10,357)
Write-off of fixed assets	41	24	19	84
Profit/(loss) of segment	132,113	75,260	(50,511)	156,862

All hotels, apartments and camps (operating assets) are located in the Republic of Croatia.

The segment information related to total assets and liabilities by reportable segments are as follows:

(in thousands of EUR)	Hotels and apartments	Campsites	Other business segments	Total
As at 31 December 2023
Total assets	409,330	178,780	92,620	680,730
Total liabilities	227,543	92,153	32,425	352,121

As at 30 September 2024
Total assets	467,949	223,937	96,201	788,087
Total liabilities	258,130	127,501	26,281	411,912

GROUP

Reconciliation of the profit per segment with profit before tax is as follows:

GROUP

(in thousands of EUR)	January - September 2023	January - September 2024
Revenue
Revenue from segments	370,543	414,274
Inter-segment revenue	(24,670)	(28.288)
Sales revenue	345,873	385.986
Profit
Profit from segments	148,414	156,862
Other unallocated expenses	(56,331)	(61,207)
Profit/(loss) from financial and extraordinary activities	(6,215)	(10,947)
Total profit before tax	85,868	(84,708)

The reconciliation of segment assets and liabilities with the Group's assets and liabilities is as follows:

GROUP

(in thousands of EUR)	As at 31 December 2023		As at 30 September 2024
	Assets	Liabilities	Assets	Liabilities
Segment assets/liabilities	680,730	352,121	788,087	411,912
Hotels and apartments segment	409,330	227,543	467,949	258,130
Campsites segment	178,780	92,153	223,937	127,501
Other business segment	92,620	32,425	96,201	26,281
Unallocated	145,481	27,269	164,450	52,279
Investments in associate	16,250	-	16,891	-
Other financial assets	158	-	23	-
Loans and deposits	25,422	-	39,426	-
Cash and cash equivalents	55,185	-	50,547	-
Other receivables	6,064	-	16,487	-
Deferred tax assets/liabilities	40,120	5,719	39,707	5,287
Other liabilities	-	17,376	-	44,134
Derivative financial assets/liabilities	2.282	-	1,369	84
Provisions	-	4,174	-	2,774
Total	826,211	379,390	952,537	464,191

The Group's hospitality services are provided in Croatia to domestic and foreign customers. The Group's sales revenues are classified according to the customers' origin.

GROUP
(in thousands of EUR)	January – September 2023	%	January – September 2024	%
Revenue from sales to domestic customers	35,104	10.15	43,143	11.18
Revenue from sales to foreign customers	310,769	89.85	342,843	88.82
	345,873	100.00	385,986	100.00

Foreign sales revenues can be classified according to the number of overnights based on the customers' origin, as follows:

GROUP

(in thousands of EUR)	January –		January –
	September 2023	%	September 2024	%
EU members	260,263	83.75	277,714	81.00
Other	50,506	16.25	65,129	19.00
	310,769	100.00	342.843	100.00

NOTE 5 – STAFF COSTS

The following table shows the information of the total cost of employees during the period:

		GROUP		COMPANY
(in thousands of EUR)	January – September 2023	January – September 2024	January – September 2023	January – September 2024
Net salaries	51,445	58,250	40,601	45,538
Tax and contributions from salary costs	20,108	24,251	16,042	19,121
Contributions on salaries	10,770	12,516	8,456	9,749
Total	82,323	95,017	65,099	74,408

For the nine-month period ended 30 September 2024 Company's average number of employees is 5,556 (30 September 2023: 5,410), while the Group's average number of employees is 7,367 (30 September 2023: 7,194).

The Company capitalised net salaries cost in the amount of EUR 785 thousand (30 September 2023: EUR 591 thousand), cost of contributions and tax from salaries in the amount of EUR 329 thousand (30 September 2023: EUR 246 thousand) and cost of contributions on salaries in the amount of EUR 172 thousand (30 September 2023: EUR 111 thousand). The Group capitalised net salaries cost in the amount of EUR 1,070 thousand (30 September 2023: EUR 875 thousand), cost of contributions and tax from salaries in the amount of EUR 450 thousand (30 September 2023: EUR 367 thousand) and cost of contributions on salaries in the amount of EUR 237 thousand (30 September 2023: EUR 176 thousand).

NOTE 6 – INCOME TAX

During the period in 2024 the Company and the Group estimate the period income tax expense/income according to the IAS 34 provisions, i.e. it is based on the best estimate of the weighted average annual income tax rate expected for the full financial year, adjusted for the expected changes during the period. Due to highly seasonal character of business, the profit tax estimate for quarterly reports is not an indicator of the final profit tax on December, 31 2024. Income tax is calculated using the legal income tax rate of 18% in the Republic of Croatia.

Established branch Valamar Riviera d.d., Zweigniederlassung Austria is an Austrian taxpayer with income tax rate of 25%.

The Company will pay income tax advances during the year 2024, determined on the basis of the final calculation of the income tax liability for 2023.

Income tax comprise:

	GROUP		COMPANY
(in thousands of EUR)	January – September 2023	January – September 2024	January – September 2023	January – September 2024
Current tax	11,136	12,365	11,136	12,279
Deferred tax	(1,047)	(10)	4,138	(241)
Tax (income)/expense	10,089	12,355	15,274	12,038

For the nine-month period ended 30 September 2024, in accordance with the provisions of IAS 34, the Company and the Group estimated tax expense which is largely the result of current tax in the amount of EUR 12.3 million for the Company and EUR 12.4 million for the Group.

Given the seasonality of the operations and the fact that net loss is expected for the fourth quarter, the Company/Group estimates that for the whole 2024 there will be a lower net profit before taxes and consequently lower corporate income tax.

Movement overview of deferred tax assets and liabilities in 2024:

DEFERRED TAX ASSET

(in thousands of EUR)	GROUP	COMPANY
As at 1 January 2024	40,120	1,536
Credited/(debited) to the income	(413)	155
As at 30 September 2024	39,707	1,691

DEFFERED TAX LIABILITIES

(in thousands of EUR)	GROUP	COMPANY
As at 1 January 2024	5,719	1,429
Credited/(debited) to the income	(424)	(87)
Credited/(debited) to the other comprehensive income	(8)	(8)
As at 30 September 2024	5,287	1,334

NOTE 7 – EARNINGS/(LOSS) PER SHARE

Basic

Basic earnings/(loss) per share are calculated by dividing the profit/(loss) for the period of the Group by the weighted average number of shares ordinary in issue during the period, excluding the ordinary shares purchased by the Company and held as treasury shares.

Diluted

Diluted earnings/(loss) per share are equal to basic, since the Group did not have any convertible instruments and share options outstanding during both periods.

	January – September 2023	January – September 2024
Profit/(loss) attributable to equity holders (in thousands of EUR)	64,969	59,900
Weighted average number of shares	122,251,398	122,925,847
Basic/diluted earnings/(loss) per share (in EUR)	0.53	0.49

NOTE 8 – NON-CURRENT TANGIBLE AND INTANGIBLE ASSETS

GROUP

After making this disposal of treasury shares at the end of the nine-month period ended 30 September 2024, the Company now holds 2,990,862 treasury shares in total, which makes 2.3732% of the Company's share capital.

According to the decision of the General Assembly on 24 April 2024, the company paid a dividend in the amount of EUR 0.22 per share, in the total amount of EUR 27,068 thousand.

NOTE 9 – NON-CURRENT TANGIBLE AND INTANGIBLE ASSETS

During the nine-month period ended 30 September 2024, the Group acquired assets in the amount of EUR 89,232 thousand (30 September 2023: EUR 47,750 thousand), while the Company acquired assets in the amount of EUR 61,230 thousand (30 September 2023: EUR 23,494 thousand).

During the nine-month period ended 30 September 2024, the Group disposed the assets with a net book value of EUR 100 thousand (30 September 2023: EUR 16 thousand), resulting in a net gain on disposal of EUR 17 thousand (30 September 2023: EUR 67 thousand).

During the nine-month period ended 30 September 2024, the Company disposed the assets with a net book value of EUR 74 thousand (30 September 2023: EUR 15 thousand), resulting in a net loss on disposal of EUR 5 thousand (30 September 2023: net gain EUR 48 thousand).

NOTE 10 – LIABILITIES FOR BORROWINGS AND LEASES UNDER IFRS 16

The following table shows bank borrowings and lease liabilities (IFRS 16) by maturity:

		GROUP		COMPANY
(in thousands of EUR)	Total liabilities on 30 September 2024	Maturity over 5 years	Total liabilities on 30 September 2024	Maturity over 5 years
Bank borrowings	273,892	72,970	159,251	49,106
Lease liabilities under IFRS 16	67,772	60,532	63,098	57,359
Total	341,664	133,502	222,349	106,465

As at 30 September 2024 non-current and current bank borrowings of the Group amounted EUR 273,892 thousand which is secured with a pledge over Group's property facilities and movable property.

As at 30 September 2024 non-current and current bank borrowings of the Company amounted EUR 159,251 thousand which is secured with a pledge over Company's property facilities and movable property.

As at 30 September 2024 lease liabilities under IFRS 16 of the Group amounted EUR

67,772 thousand, of which the most significant item is the rental of tourist land in the amount of EUR 64,123 thousand.

As at 30 September 2024 lease liabilities under IFRS 16 of the Company amounted EUR 63,098 thousand, of which the most significant item is the rental of tourist land in the amount of EUR 59,159 thousand.

Detailed explanation of tourist land leases liabilities in Note 2.4 Critical accounting estimates.

NOTE 11 – CONTINGENCIES AND COMMITMENTS

The contracted capital commitments of the Company in respect to investments in tourism facilities at 30 September 2024 amount to EUR 82,622 thousand (30 September 2023: EUR 66,585 thousand). The contracted capital commitments of the Group in respect to investments in tourism facilities at 30 September 2024 amount to EUR 113,282 thousand (30 September 2023: EUR 73,978 thousand).

The Company is the guarantor of the loans of related-party Valamar Obertauern GmbH. The estimated maximum amount of the guarantee that can be realized is EUR 5,392 thousand. The loan of the related-party is secured by mortgages on the real estate of Valamar Obertauern GmbH. The Company estimates the very low probability of incurring an actual obligation under the guarantee.

The Company was the guarantor of the loan of related-party Imperial Riviera d.d. in the amount EUR 48,889 thousand, and to secure the claim a pledge over Imperial Riviera's property facilities was established in the amount of the claim. On 15 April, 2024, the Company concluded agreements with OTP banka d.d. on the termination of the loan guarantee agreement with the related party Imperial Riviera d.d. Following the termination of the guarantee agreement on 16 April, 2024, the Company signed an agreement with the related-party Imperial Riviera d.d. on the termination of the insurance of the guarantee agreement and approved the deletion of the lien on the real estate of Imperial Riviera d.d.

In 2023, the Company initiated an administrative dispute to annul the Decision of the Ministry of the Sea, Transport and Infrastructure, adopted after inspection supervision of economic use of the maritime domain in the area of the Ježevac camping on the island of Krk. This Decision includes a ban on the provision of accommodation services on several cadastral parcels and a ban on the provision of anchoring services. In 2024, a non-final judgment was delivered against the company, and the company appealed against this judgment to the competent court. The Government of the Republic of Croatia in its Conclusion from June 2024, gave the task to the Ministry of the Sea, Transport and Infrastructure to determine the boundary of the maritime domain for all camps in front of which the border of the maritime domain has not been determined, and order that the Customs Administration and the Ministry of Sea, Transport and Infrastructure, the Navigation Safety Administration stop with the inspection measures banning the operation of camps until the property relations on the maritime domain are resolved, by 31 December 2025 at latest. In July, the Ministry of the Sea, Transport and Infrastructure accepted the Company's proposal to renew the procedure and removed the ban on providing accommodation in Ježevac camp. Regarding the same subject, at the beginning of February, 2024, a notice of tax inspection was received from the Ministry of Finance which begins on 27 February, 2024. The Company in its business books did not make a reservation on the basis of the facts and allegations presented so far because it is not possible to assess the possible degree of responsibility of the Company which will continue to actively participate in the initiated procedure.

In a lawsuit from 2012 for the payment of the amount on behalf of work on the Lacroma hotel the first degree judgment of the Commercial Court from 2015, which was in the second degree of 2019 confirmed by the High Commercial Court, dismissed the claim of the plaintiff. However, on 4 July, 2023, the Supreme Court of the Republic of Croatia abolished the judgments of the Commercial Court and the High Commercial Court and returned the case for retrial. Based on the receivables from the claim, the principal in this case amounts to EUR 1,498,608.42. In February 2024, the Commercial Court in Dubrovnik issued a first degree verdict in favor of the Company in a repeated proceeding. In the appeal proceeding on the plaintiff's appeal, on 26 March, 2024, the High Commercial Court of the Republic of Croatia issued a final judgment against the Company, reversing the judgment of the Commercial Court in Dubrovnik from February 2024 and upheld the plaintiff's claims. On 28 May, 2024, the Company filed a proposal for permission to revise against judgment of the High Commercial Court of the Republic of Croatia. On 23 May, on the basis of a final judgment of the High Commercial Court of the Republic of Croatia, the plaintiff transferred the funds from the Company's account to the account of the Financial Agency. On 3 June, 2024, the Company submitted to the competent court a Proposal to postpone the issuance of an order to banks to transfer seized funds. On 4 July, the Municipal Court in Pazin issued a decision ordering the Financial Agency to postpone the issuance of orders to banks for the transfer of confiscated funds until the Supreme Court of the Republic of Croatia makes a decision regarding the above mentioned revision. In the second quarter of 2024, the Company recorded in the books costs in the amount of EUR 4,1 million in the name of principal and interest rates in this litigation process.

NOTE 12 – ASSOCIATES

The following table shows total capital and reserves and profit or loss for the last business year of associates as at 31 December 2023:

				(in thousands of EUR)
ASSOCIATE	Country	Ownership	Total capital and reserves	Profit/loss for the year /ii/
Helios Faros d.d., Stari Grad	Croatia	20.00%	52,511	(1,419)
Valamar A GmbH, Wien /i/	Austria	24.54%	20,116	(524)
Valamar Obertauern GmbH, Obertauern /i/	Austria	10% directly/ 22.08% indirectly	3,640	(267)
WBVR Beteiligungs GmbH, Wien /i/	Austria	24,54% indirectly	4,057	(4)
Valamar Marietta GmbH, Klagenfurt am Wörthersee /i/	Austria	24,54% indirectly	1,770	(848)
Kesselspitze GmbH, Obertauern /i/	Austria	24,54% indirectly	33	(1)
Kesselspitze GmbH & Co KG, Obertauern /i/	Austria	24,54% indirectly	10,727	(806)

/i/ Explained detailed in Note 1 – General information.

/ii/ For the purposes of the Group's financial reporting, the profit/loss of the business year of Austrian companies includes the period from 1 January to 31 December, while the business year of the mentioned companies lasts from 1 November to 31 October.

NOTE 13 – RELATED PARTY TRANSACTIONS

Related party transactions were as follows: GROUP

(in thousands of EUR)	January – September 2023	January – September 2024
Sale of services
Associate with participating interest	1,478	2,130
	1,478	2,130
Purchase of services
Other parties related to the owners and corporate governance bodies	129	162
Associate with participating interest	19	86
	148	248
	As at 31 December 2023	As at 30 September 2024
Trade and other receivable
Associate with participating interest	1,374	248
	1,374	248
Liabilities
Other parties related to the owners and corporate governance bodies	32	18
Associate with participating interest	16	12
	48	30
Loans and deposits given
Associate with participating interest	968	1,468
	968	1,468

NOTE 13 – RELATED PARTY TRANSACTIONS / CONTINUED

Related party transactions were as follows: COMPANY

(in thousands of EUR)	January – September 2023	January – September 2024
Sale of servies
Subsidiaries	10,804	12,661
Associate with participating interest	1,478	2,130
	12,282	14,791
Purchase of services
Subsidiaries	1,635	1,900
Associate with participating interest	129	162
Other parties related to the owners and corporate governance bodies	14	69
	1,778	2,131
Dividend income
Subsidiaries	2,183	4,978
	2,183	4,978
	As at 31 December 2023	As at 30 September 2024
Trade and other receivable
Subsidiaries	2,341	2,125
Associate with participating interest	1,373	248
	3,714	2,373
Trade and other payables
Subsidiaries	48	387
Associate with participating interest	32	18
Other parties related to the owners and corporate governance bodies	10	12
	90	417
Loans and deposits given
Associate with participating interest	968	1,468
	968	1,468

NOTE 14 – SUBSEQUENT EVENTS

On 2 October 2024 a Decision was received that the Supreme Court of the Republic of Croatia is rejecting the proposal of Valamar Riviera d.d. for permission to revise the final judgment of the High Commercial Court in the court dispute with the plaintiff Elektrolux građenje d.o.o. On 9 October 2024 the Municipal Court in Pazin issued a Decision ordering the Financial Agency to transfer funds in favor of Elektrolux građenje d.o.o.all in accordance with the Decision from 4 July 2024 (explained detailed in Note 11 – Contingencies and commitments). Valamar Riviera d.d. has 30 days left to file a constitutional complaint.

Valamar Riviera d.d.

Stancija Kaligari 1 52440 Poreč, Hrvatska T +385 (52) 408 002 F +385 (52) 451 608 E [email protected] W www.valamar.com

Investor Relations

Stancija Kaligari 1 52440 Poreč, Hrvatska T +385 (52) 408 159 F +385 (52) 451 608 E [email protected] W www.valamar-riviera.com

AI Terminal

Valamar Riviera d.d.

2085_10-q_2024-10-24_2351410d-be71-4f0a-9516-e4b869d7d93a.pdf

BUSINESS RESULTS 1/1/2024 - 30/9/2024

BUSINESS RESULTS 1/1/2024 - 30/9/2024

Tourism portfolio of Valamar

ABOUT VALAMAR

Valamar structure

KEY MESSAGES

OUTLOOK

TABLE OF CONTENTS

Results of the Group

Q UA R T E R LY F I N A N C I A L S TAT E M E N TS

KEY FINANCIAL INDICATORS1

KEY BUSINESS INDICATORS10

Noćenja i ARR

Revenues and accommodation units sold

REVENUES

TOTAL OPERATING EXPENSES OF VALAMAR GROUP12

TOTAL OPERATING EXPENSES

EBITDA AND PROFIT FOR THE PERIOD

RESULT FROM FINANCIAL AC TIVITIES

Net debt 14

ASSETS AND LIABILITIES

Assets and liabilities

BUSINESS RESULTS 1/1/2024 - 30/9/2024

HOTEL AND CAMPING RESORTS OVERVIEW*

Results of the Company

Investment cycle 2023/24

VALAMAR RIVIERA

IMPERIAL RIVIERA

ESG & Human resources

SUSTAINABILITY

ESG STRATEGY

ESG PROJECTS AND ACHIEVEMENTS

Environment

MONITORING 12 ESG GOALS

Society

Governance

HUMAN RESOURCES

FINANCIAL RISKS

1) Foreign exchange risk

2) Interest rate risk

3) Credit risk

4) Price risk

5) Liquidity risk

6) Share-related risks

7) Risk of inflation and increase in prices of purchased goods

BUSINESS RISK

OPERATIONAL RISKS

GLOBAL RISKS

REGULATORY RISKS

Corporate Governance

THE COMPANY'S CORPORATE BODIES ARE:

Related-party Transactions & Branch Offices

R E L AT E D - PA R T Y T R A N S AC T I O N S

BRANCH OFFICES OF THE COMPANY

Valamar Share

Additional Information

ADDITIONAL INFORMATION

Disclaimer

RESPONSIBILITY FOR THE QUARTERLY FINANCIAL STATEMENTS

In Poreč, 24 October 2024

S T A T E M E N T

According to our best knowledge:

Reporting period: from 01.01.2024 to 30.09.2024

Quarterly financial statements

BALANCE SHEET (balance as at 30.09.2024) Submitter: Valamar Riviera d.d. in EUR

BALANCE SHEET (balance as at 30.09.2024) (continued) Submitter: Valamar Riviera d.d. in EUR

STATEMENT OF PROFIT OR LOSS (for the period 01.01.2024 to 30.09.2024) Submitter: Valamar Riviera d.d. in EUR

STATEMENT OF PROFIT OR LOSS (for the period 01.01.2024 to 30.09.2024) (continued) Submitter: Valamar Riviera d.d. in EUR

DISCONTINUED OPERATIONS (to be filled in by undertakings subject to IFRS only with discontinued operations)

TOTAL OPERATIONS (to be filled in only by undertakings subject to IFRS with discontinued operations)

APPENDIX to the P&L (to be filled in by undertakings that draw up consolidated annual financial statements)

STATEMENT OF OTHER COMPRHENSIVE INCOME (to be filled in by undertakings subject to IFRS)

STATEMENT OF PROFIT OR LOSS (for the period 01.01.2024 to 30.09.2024) (continued) Submitter: Valamar Riviera d.d. in EUR

APPENDIX to the Statement on comprehensive income (to be filled in by undertakings that draw up consolidated statements)

STATEMENT OF CASH FLOWS - indirect method (for the period 01.01.2024 to 30.09.2024) Submitter: Valamar Riviera d.d. in EUR

STATEMENT OF CHANGES IN EQUITY (for the period 01.01.2024 to 30.09.2024) Submitter: Valamar Riviera d.d. in EUR

NOTES TO FINANCIAL STATEMENTS - TFI