Turbomecanica S.A.

Earnings Release • May 11, 2018

Subject: REPORT OF THE BORD OF ADMINISTRATION OF TMB FOR MARCH 2018

www.turbomecanica.ro; e-mail: office@turbomecanica.ro

TURBOMECANICA SA is a Romanian entity having the legal form of open a joint stock Company according to the Constitutive Act and applicable regulations, privately owned, whose shares are listed on the Bucharest Stock Exchange.

Its field of activity is exclusively manufacturing and according to the classification of activities in the national economy, its main object of activity is the Manufacturing of engines, mechanical assemblies and equipment for aircraft – NACE CODE 3030.

The Company carries out its activity in a highly competitive environment according to the widely recognised principles of corporate governance, in accordance with Romanian legislation, the legislation of the European Union and international practices, supplying on domestic and foreign markets products and services both in the field of defence and civil aviation.

The Company has a long history of start-ups; it has experienced diversification and developments, but also restructures, falls, searches, new beginnings. However, throughout all this time, it has never stopped operating in the aviation and defence industry.

The financial results will be included in the financial statements of the year 2018, prepared in accordance with International Financial Reporting Standards (IFRS). Some of the elements are listed below:

	31 MARCH 2018	31 MARCH 2017
Revenues	17.580.872	- 19.358.538
Other gains and loss	384.441	- 1.077.238
Change in inventories of finished goods and work in progress	1.034.086	- 2.362.752
Raw materials and consumables used	(5.191.120)	- (9.497.577)
Employee benefits expense	(6.795.589)	- (6.985.616)
Depreciation and amortisation expense	(2.388.689)	- (1.618.301)
Finance cost, net	(758.327)	- (852.232)
Othe operating expenses	(1.481.119)	- (1.086.140)
Gross profit/Profit before tax	2.384.555	2.758.662
Income tax expense/ benefit	593.068	540.418
Net profit	1.791.487	2.218.244

1. Statement of profit and loss:

The Company recorded operating revenues in amount of Lei 18.619.294 and operating expenses in amount of Lei 15.589.915.

The largest share of this revenue was made through specific activities related to the production profile of the Company.

the Company recorded net profit in amount of Lei 1.791.487, at the end first Quarter.

2. Statement of financial position:

	31 MARCH 2018	31 DECEMBER 2017
Assets
Fixed assets
Property, plant and equipment, net	58.688.959	59.961.955
Intangible assets, net	6.175.277	6.784.610
Other assets	1.000	1.000
Total fixed assets	64.865.237	66.747.565
Current assets
Inventory	45.250.234	36.947.781

Trade receivables	7.804.347	2.632.790
Other receivables and prepayments	1.662.159	1.711.184
Cash and bank balances	2.117.249	9.636.856
Non current assets classified as held
for sale	6.966.252	6.966.252
Total current assets	63.800.240	57.894.863
Total assets	128.665.477	124.642.427
Shareholder equity and liabilities
Shareholder equity
Share Capital	1.024.571.055	1.024.571.055
Reserves	88.342.121	88.372.743
Retained earnings	(1.051.009.033)	(1.052.231.734)
Own shares	-	(599.408)
Total shareholder equity	61.904.143	60.112.656
Long term liabilities
Borrowings LT	4.312.628	5.670.250
Deferred tax liabilities	3.659.565	3.659.565
Provisions LT	1.259.764	1.259.764
Other liabilities LT	0	0
Total liabilities TL	9.231.957	10.589.580
Current liabilities
Short term loans	10.851.338	5.817.305
Borrowings ST	39.437.551	37.168.913
Income tax expense/benefit	593.068	1.517.497
Provisions ST	3.213.187	3.597.787
Defferend income	1.143.999	868.861
Other liabilities ST	2.290.233	4.969.829
Total current liabilities	57.529.377	53.940.192
Total liabilities	66.761.334	64.529.773
Total shareholder equity and liabilities	128.665.477	124.642.427

The share capital of the Company is in amount of Lei 61.904.143.

The accounting activity was conducted in accordance with the OMFP no. 2844/2016 for the approval of accounting regulations, in accordance with the International Financial Reporting Standards applicable to companies whose securities are admitted to trading on a regulated market and in accordance with the Accounting Law no. 82/1991 with all its subsequent amendments.

All documents regarding economic and financial operations have been recorded correctly every day. Economic and financial operations have been recorded based on financial documents. All accounting information has been posted in the correct accounting statement (assets, liabilities and equity) and corresponds to the real situation of the Companies patrimony.

The debt towards the State Budget has been correctly registered, paid and reflected in the balance sheet. We state that the Financial Statements at 31 March 2018 are unaudited financial.

PRESIDENT OF THE BOARD OF DIRECTORS

RADU VIEHMANN

Subject:

FINANCIAL-ECONOMIC INDICATORS AT 31 MARCH 2018

No.	Economic indicators	Formula	31 MARCH 2018	31 MARCH 2017
1	Current liquidity ratio	current assets / current liabilities	1,11	0,91
2	Total debt ratio	(Borrowed capital Deferred tax liabilities /Share Capital )	0,07	0,09
3	Receivable turnover ratio	( Accounts Receivable / Turnover ) * 90 days	26,71	13,34
4	Fixed assets turnover ratio	Turnover / Fixed assets	0,27	0,31

GENERAL MANAGER,

RADU VIEHMANN ECONOMIC- COMMERCIAL MANAGER, ION DINCA

Subject: STATEMENT OF FINANCIAL POSITION AT 31 MARCH 2018

	31 MARCH 2018	31 DECEMBER 2017
Assets
Fixed assets
Property, plant and equipment,
net	58.688.959	59.961.955
Intangible assets, net	6.175.277	6.784.610
Other assets	1.000	1.000
Total fixed assets	64.865.237	66.747.565
Current assets
Inventory	45.250.234	36.947.781
Trade receivables	7.804.347	2.632.790
Other receivables and
prepayments	1.662.159	1.711.184
Cash and bank balances	2.117.249	9.636.856
Non current assets classified as
held for sale	6.966.252	6.966.252
Total current assets	63.800.240	57.894.863
Total assets	128.665.477	124.642.427
Shareholder equity and liabilities
Shareholder equity
Share Capital	1.024.571.055	1.024.571.055
Reserves	88.342.121	88.372.743
Retained earnings	(1.051.009.033)	(1.052.231.734)
Own shares	-	(599.408)
Total shareholder equity	61.904.143	60.112.656
Long term liabilities
Borrowings LT	4.312.628	5.670.250
Deferred tax liabilities	3.659.565	3.659.565
Provisions LT	1.259.764	1.259.764
Other liabilities LT	0	0
Total liabilities TL	9.231.957	10.589.580

Total shareholder equity and liabilities	128.665.477	124.642.427
Total liabilities	66.761.334	64.529.773
Total current liabilities	57.529.377	53.940.192
Other liabilities ST	2.290.233	4.969.829
Defferend income	1.143.999	868.861
Provisions ST	3.213.187	3.597.787
Income tax expense/benefit	593.068	1.517.497
Borrowings ST	39.437.551	37.168.913
Short term loans	10.851.338	5.817.305
Current liabilities

GENERAL MANAGER,

RADU VIEHMANN ECONOMIC-COMMERCIAL MANAGER, ION DINCA

Subject: STATEMENT OF PROFIT AND LOSS AT 31 MARCH 2018

	31 MARCH 2018	31 MARCH 2017
Revenues	17.580.872	19.358.538
Other gains and loss	384.441	1.077.238
Change in inventories of finished goods and work in progress	1.034.086	2.362.752
Raw materials and consumables used	(5.191.120)	(9.497.577)
Employee benefits expense	(6.795.589)	(6.985.616)
Depreciation and amortisation expense	(2.388.689)	(1.618.301)
Finance cost, net	(758.327)	(852.232)
Othe operating expenses	(1.481.119)	(1.086.140)
Gross profit/Profit before tax	2.384.555	2.758.662
Income tax expense/ benefit	593.068	540.418
Net profit	1.791.487	2.218.244

GENERAL MANAGER,

RADU VIEHMANN ECONOMIC-COMMERCIAL MANAGER, ION DINCA