31 December 2021. The Group's consolidated financial statements have been prepared in accordance with International Financial Reporting Standards ("IFRS") as adopted by the European Union ("EU") and the requirements of the Cyprus Companies Law, Cap. 113.

Principal activities

The principal activities of the Group are the agricultural production (cultivation of sugar beet, grain

and other agricultural crops), cultivation of pigs, processing of raw sugar and production of sugar

from sugar beet, vegetable oil production and processing.

Review of developments, position and performance of the Group's business

In 2021 revenue increased by RR 63,961,404 thousand or 40%. All segments demonstrated an increase in revenue. The major contributor to the sales increase was the Oil and Fat segment where turnover was higher by RR 45,510,350 thousand or 57% comparing to the previous year. Revenue in Sugar segment /increased by 29%, in the Agricultural and in Meat segments increased by 22%.

In 2021 Adjusted EBITDA increased by RR 16,075,715 thousand or 50% with positive dynamics in all segments except Meat. The highest increase demonstrated the Agriculture and Oil and Fat divisions due to the increase in gross profits. EBITDA in the Agricultural division was higher by RR 8,060,003 thousand or 53% and in the Oil and Fat division by RR 3,411,254 thousand or 36% growth. EBITDA in the Sugar segment increased by 41% and in the Meat segment decreased by 9%.

In 2021 the Group investments in property, plant and equipment and inventories intended for construction amounted to RR 42,505,370 thousand on a cash basis. Investments in the Oil and Fat division amounted to RR 30,792,485 thousand, including SolPro assets acquisition amounted to RR 28,735,087 thousand. Investments of RR 8,052,382 thousand were made in the Meat segment and were mainly related to pig farm construction in Primorsky Krai. The Agricultural segment invested RR 2,660,291 thousand in acquisition of land, new agricultural machinery and equipment. The Sugar segment invested RR 1,000,212 thousand in modernization of the sugar plants.

Changes in the Group's structure

The following company was liquidated during the year:

· LLC Primorskaya Niva on 28 October 2021

The Group obtained 100.00% of ownership interest in the newly incorporated companies:

· LLC Rusagro-Zakupki on 12 March 2021

· LLC Rusagro-NPK on 27 May 2021

· LLC Agromeliorant on 23 August 2021

· LLC RusagroTechnologii on 6 August 2021

· LLC Rusagro-Altai on 25 October 2021

The Group acquired 100.00% of ownership interest in the company:

· LLC Tsyfrovoi Fermer on 22 November 2021

On 22 October 2021 the Group acquired 25% additional shares in LLC Primorskaya Soya, thereby increasing its shares in the share capital of LLC Primorskaya Soya to 100% (2020: 75%).

For more details regarding the Group structure refer to Note 1 and Note 29 of the consolidated financial statements.

Principal risks and uncertainties

The Group's critical estimates and judgments and financial risk management are disclosed in Notes 2

and 30 to the consolidated financial statements. The Group's operating environment is disclosed

in Note 1 to the consolidated financial statements.

The Group's contingencies are disclosed in Note 31 to the consolidated financial statements.

Future developments

In 2021 and beyond, the Group plans to continue modernization and expansion of its production and storage facilities in all business segments. The Group plans to make further developments in the Far East region in agricultural and meat businesses.

Results

The Group's results for the year are set out on page 2 of the consolidated financial statements.

Human resources management and environmental protection

The Group offers its employees opportunities to realize their professional potential, improve their knowledge and skills, work on interesting innovative projects and be part of a cohesive team. Group management believes that one of the keys to a successful business is maintaining a balance between the high quality and efficient work of all employees who share common values and principles on one hand, and the Company's commitment to providing opportunities for career growth on the other. Group business divisions annually prepare and implement employee training and development plans based on the business's strategic and current objectives, as well as needs identified by comprehensive assessment. Based on the results of a comprehensive assessment, every employee draws up an individual development plan for a period of one to two years that lists all training and development activities that are intended to advance the employee's skills or pass on the knowledge they have gained.

The Group is committed to protecting the environment and minimizing the environmental impact of its operations in regions where it has a presence. All of the Group's divisions constantly monitor wastewater runoff and air quality, and are equipped with treatment facilities that meet all the standards of applicable environmental legislation. The Group has implemented guidelines for maximum allowable emissions and guidelines for waste generation and established sanitary buffer zones for warehouses storing crop protection agents. The Group also returns packaging from crop protection agents and fertilizer to counterparties and performs soil deacidification efforts on farmland.

The composition and diversity information of the Board of Directors of the Group

The authority and responsibilities of the Board of Directors are described in the Internal Rules of the Board of Directors.

On behalf of all shareholders and on the proposal or advice of the Management Board, the Board of Directors lays down the strategy and general policy of the Group. It also sets the Group's standards and monitors the implementation of that strategy.

It controls and gives direction to the management of the company and the Group and provides monitoring of risks.

It also ensures that the principles of good governance are respected.

The Board's acts are guided solely by a concern for the interests of the Company in relation to its shareholders, its customers and staff.

The Board of Directors is the decision-making body of our Group. Its role is to define the Group's strategic vision, assisted by a specialized committee (the Audit Committee). It is composed of 5 Directors, including 2 independent Directors and 1 managing Director. The Board offers a diverse and synergistic range of experience, nationalities and cultures and enables us to consider the interests of all our shareholders.

The Board has determined that, as a whole, it has the appropriate skills and experience necessary to discharge its functions. Executive and independent Directors have the experience required to contribute meaningfully to the Board's deliberations and resolutions. Independent Directors assist the Board by constructively challenging and helping develop strategy proposals.

Dividends

Pursuant to its Articles of Association the Company may pay dividends out of its profits. In August 2013 the Board of Directors has approved a new dividend policy with payout ratio of at least 25% of the Group's profit for the year applicable starting from the year ended 31 December 2013. On 13 September 2021 the Board of Directors has approved a new dividend policy with increased payout ratio to at least 50% of the Group's profit for the year. To the extent that the Company declares and pays dividends, owners of Global Depositary Receipts (hereafter also referred as "GDRs") on the relevant record date will be entitled to receive dividends payable in respect of Ordinary Shares underlying the GDRs, subject to the terms of the Deposit Agreement.

The Company is a holding company and thus its ability to pay dividends depends on the ability of its subsidiaries to pay dividends to the Company in accordance with the relevant legislation and contractual restrictions. The payment of such dividends by its subsidiaries is contingent upon the sufficiency of their earnings, cash flows and distributable reserves. The maximum dividend payable by the Company`s subsidiaries is restricted to the total accumulated retained earnings of the relevant subsidiary, determined according to the Russian law.

In 2021 the Company distributed RR 10,770,584 thousand of remaining dividends for 2020 and RR 8,755,947 thousand of interim dividends for 2021. The remaining dividends for 2020 amounted to RR 400.30 per share and interim dividends for 2021 amounted to RR 325.42 per share.

Subsequent to the year ended 31 December 2021, the Board of Directors recommends the payment of additional dividends out of the profits for 2021 in the amount of RR 11,928,542 thousand. Given that the Company has already paid interim dividends for the 2021 in the amount of RR 8,755,947 thousand, the total dividend out of the profits for 2021 and prior years' undistributed reserves amounts to RR 20,684,489 thousand.

The proposed dividend is subject to approval by the shareholders at the Annual General Meeting. These consolidated financial statements do not reflect the dividends that have not been approved on the reporting date.

Share capital

There were no changes in the share capital of the Company during 2020 and 2021.

The role of the Board of Directors

The Company is governed by its Board of Directors (hereafter also referred as the "Board") which is collectively responsible to the shareholders for the successful performance of the Group.

The Board sets corporate strategic objectives, ensuring that the necessary financial and human resources are in place for the Group to meet its objectives and reviewing management performance.

The Board of Directors sets the Group's values and standards and ensures all obligations

to shareholders are understood and met. The Board believes it maintains a sound system of internal control to safeguard the Group's assets and shareholders' investments in the Group.

Significant direct/indirect holdings

For the significant direct and indirect shareholdings held by the Company, please refer to Note 1 of the consolidated financial statements.

Members of the Board of Directors

The members of the Board of Directors at 31 December 2021 and at the date of this report are shown in the beginning of these consolidated financial statements. All of them were members of the Board throughout the year ended 31 December 2021.

In accordance with the Company's Articles of Association, one third of the Directors shall retire by rotation and seek re-election at each Annual General Meeting.

The Company's Directors' remuneration is disclosed in Note 27. There were no any significant changes to the Directors' remuneration during the year ended 31 December 2021.

Directors' Interests

The Directors Mr. Vadim Moshkovich, Mr. Maxim Basov, Mr. Richard Andrew Smyth and Mr. Anastassios Televantides held interest in the Company as at 31 December 2021 and 31 December 2020.

Mr. Vadim Moshkovich had no direct interest in the Company as at 31 December 2021 and 31 December 2020. The number of shares held indirectly through a company controlled by him as at 31 December 2021 is 15,367,829 (31 December 2020: 19,327,829).

The number of shares and GDRs held directly by Mr. Maxim Basov as at 31 December 2021 is 1,000,000 and 5,392,809 (equivalent of 1,078,562 shares), respectively (31 December 2020: 1,000,000 shares and 5,084,809 GDRs equivalent to 1,016,962 shares).

The number of GDRs held directly by Mr. Richard Andrew Smyth as at 31 December 2021 and 31 December 2020 is 31,125 (equivalent of 6,225 shares).

The number of GDRs held directly by Mr. Anastassios Televantides as at 31 December 2021 and 31 December 2020 is 10,000 (equivalent of 2,000 shares).

Audit Committee

The Board of Directors has established an Audit Committee. The Audit Committee is primarily responsible for (i) ensuring the integrity of our consolidated financial statements, (ii) ensuring our compliance with legal

and regulatory requirements, (iii) evaluating our internal control and risk management procedures, (iv) assuring the qualification and independence of our independent auditors and overseeing the audit process and (v) resolving matters arising during the course of audits and coordinating internal audit functions. The Audit Committee consists of three members appointed by the Board of Directors.

The current members are Mr. Anastassios Televantides (Chairman), Mr. Richard Andrew Smyth

and Mrs. Ganna Khomenko.

Internal control and risk management systems in relation to the financial reporting process

The internal control and risk management systems relating to financial reporting are designed to provide reasonable assurance regarding the reliability of financial reporting and to ensure compliance with applicable laws and regulations. The Audit Committee of the Board of directors of the Company reviews high-risk areas at least once a quarter. Reporting from various Group entities to the central office is supervised on an ongoing basis and procedures have been established for control and checking of such reporting. With each acquisition the Group seeks to adapt and incorporate the financial reporting system of the acquired operations quickly and efficiently.

Corporate Governance

Since 2011, the Company adopted the following codes: Code of Conduct on insider information and Code of Business Conduct and Ethics. In addition, since May 2014 the Company together with its subsidiaries and affiliates adopted a new edition of the Codes for mandatory compliance by all employees. In 2017 the Company adopted a new Code of Conduct and Business Ethics.

Non-Financial and Diversity Information

The Group publishes its non -financial information and Diversity Statement together with the Annual report on the Company's website, www.rusagrogroup.ru.

Events after the balance sheet date

The material events after the consolidated balance sheet date are disclosed in Note 1 and 33 to the consolidated financial statements. The Board considered the effects of the circumstances disclosed in Note 1 and concluded that no significant impact is expected to affect the Group's operations.

Branches

The Company operated through its branches in the United Arab Emirates and Hong Kong during the year.

Treasury shares

On 25 August 2011 the Board unanimously resolved that it is in the best interest of the Company to buy back GDRs from the market for the total amount of up to USD 10 million increased to up to USD 30 million via subsequent Board's decision on 17 July 2012.

At 31 December 2021 and 2020, the Company held 2,135,113 of its own GDRs (approximately 427,063 shares) that is equivalent to RR 490,607 thousand, representing 1.6% of its issued share capital. The GDRs are held as 'treasury shares'.

In 2020, the Company transfer 31,000 of its own GDRs (approximately 6,200 shares) from those held as treasury shares to employees of the Group representing 0.02% of the issued share capital. No GDRs were transferred to the employees under the share option incentive scheme during 2021.

During 2021 and 2020 the Company did not buy back any of its own GDRs from the market.

Research and development activities

The Group is not engaged in research and development activities.

Going Concern

Directors have access to all information necessary to exercise their duties. The Directors continue

to adopt the going concern basis in preparing the consolidated financial statements based on the fact that, after making enquiries and following a review of the Group's budget for 2022, including cash flows and borrowing facilities, the Directors consider that the Group has adequate resources to continue in operation

for the foreseeable future.

Independent Auditors

On 13 August 2021 it was agreed by the board that rotation of the auditors would take place every 5 years for the purpose of getting objective and fresh view over Company's performance and business processes, especially in terms of rapid growth. On 26 November 2021 EGM approved replacement of the independent auditor from PricewaterhouseCoopers Limited to KPMG Limited Chartered Accountants.

By Order of the Board

___________________________

Vadim Moshkovich

Chairman of the Board of Directors

Larnaca

25 February 2022

The Company's Board of Directors is responsible for the preparation of the consolidated financial statements that give a true and fair view in accordance with International Financial Reporting Standards as adopted by the European Union and the requirements of the Cyprus Companies Law, Cap.113, and for such internal control as the Board of Directors determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. This responsibility includes selecting appropriate accounting policies and applying them consistently; and making accounting estimates and judgements that are reasonable in the circumstances.

In preparing the consolidated financial statements, the Board of Directors is also responsible for assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Board of Directors either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Company's financial reporting process.

Each of the Directors confirms to the best of his or her knowledge that the consolidated financial statements, which are presented on pages 1 to 68, have been prepared in accordance with International Financial Reporting Standards as adopted by the European Union and the requirements of the Cyprus Companies Law, Cap.113, give a true and fair view of the assets, liabilities, financial position and profit or loss of the Company.

Further, the Board of Directors confirms that, to the best of its knowledge:

(i) adequate accounting records have been maintained which disclose with reasonable accuracy the financial position of the Company and explain its transactions;

(ii) all information of which it is aware that is relevant to the preparation of the consolidated financial statements, such as accounting records and all other relevant records and documentation, has been made available to the Company's auditors;

(iii) the consolidated financial statements disclose the information required by the Cyprus Companies Law, Cap.113 in the manner so required;

(iv) the Management Report has been prepared in accordance with the requirements of the Cyprus Companies Law, Cap.113, and the information given therein is consistent with the consolidated financial statements;

(v) the information included in the corporate governance statement in accordance with the requirements of subparagraphs (iv) and (v) of paragraph 2(a) of Article 151 of the Cyprus Companies Law, Cap. 113, and which is included as a specific section of the Management Report, have been prepared in accordance with the requirements of the Cyprus Companies Law, Cap, 113, and is consistent with the consolidated financial statements; and

(vi) the corporate governance statement includes all information referred to in subparagraphs (i), (ii), (iii), (vi) and (vii) of paragraph 2(a) of Article 151 of the Cyprus Companies Law, Cap. 113.

By Order of the Board

___________________________

Vadim Moshkovich

Chairman of the Board of Directors

Larnaca

25 February 2022

INDEPENDENT AUDITORS' REPORT TO THE MEMBERS

ROS AGRO PLC

Report on the audit of the consolidated financial statements

Opinion

We have audited the accompanying consolidated financial statements of ROS AGRO PLC (the ''Company'') and its subsidiaries (the ''Group''), which are presented on pages 1 to 68 and comprise the consolidated statement of financial position as at 31 December 2021, and the consolidated statements of profit or loss and other comprehensive income, changes in equity and cash flows for the year then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying consolidated financial statements give a true and fair view of the consolidated financial position of the Group as at 31 December 2021, and of its consolidated financial performance and its consolidated cash flows for the year then ended in accordance with International Financial Reporting Standards as adopted by the European Union (''IFRS-EU'') and the requirements of the Cyprus Companies Law, Cap. 113, as amended from time to time (the ''Companies Law, Cap.113'').

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (''ISAs''). Our responsibilities under those standards are further described in the ''Auditors' responsibilities for the audit of the consolidated financial statements'' section of our report. We are independent of the Group in accordance with the International Code of Ethics (Including International Independence Standards) for Professional Accountants of the International Ethics Standards Board for Accountants (''IESBA Code'') together with the ethical requirements in Cyprus that are relevant to our audit of the financial statements, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the IESBA Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key audit matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the current period. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.



Please refer to the Note 10 in the financial statements.
The key audit matter	How the matter was addressed in our audit
This issue has become a key focus area for our audit due to the significance of the amounts and the subjective nature of the valuation of investment in LLC GK Agro-Belogorie. At 31 December 2021, the carrying amount of investment in LLC GK Agro-Belogorie at fair value through other comprehensive income amounted to RUB 8 556 556 thousand. The fair value of this investment was measured using a discounted cash flow model based primarily on unobservable inputs and involving significant management judgment.	We involved our own valuation specialists to assist us in evaluating the assumptions and methodologies used by the Company. Among others, our audit procedures included: - evaluating the principles and the integrity of the Company's discounted cash flow model - assessing the reasonableness of the Company's assumptions including projected EBITDA margins and discount rates - assessing the accuracy of the Company's historic financial information to support evaluation of forecasts incorporated in the discounted cash flow model We also considered the adequacy of the Company's disclosures with regard to fair value measurement of this investment.



Please refer to the Note 4 and Note 15 in the financial statements.
The key audit matter	How the matter was addressed in our audit
During 2018, the Group entered into a transaction involving the acquisition of secured debt from a third-party group of companies Solnechnye Producty (SolPro), which were classified as short-term and long-term investments and initially recognized at fair value. During 2021 the Group purchased assets of SolPro in the amount of RUB 28 202 943 thousand and recognised a reversal of expected credit loss allowance for the loans receivable from SolPro in the amount of RUB 4 804 688 thousand due to settlement of the debts in the excess of the carrying amount recognised. At 31 December 2021, the carrying amount of investment in SolPro recognised at amortised cost amounted to RUB 1 591 805 thousand Given the overall complexity of the transaction and the judgements applied in this calculation we consider this to be a key audit matter.	We assessed whether the assets acquired by the Group from SolPro meet definition of business under IFRS 3 by analysing whether elements of definition of the business are present. We assessed whether the Group might have obtained control over SolPro assets before acquisition of those assets by analysing the rights of the Group as the main creditor over the relevant activities of SolPro during the bankruptcy process. We also considered the adequacy of the Group's disclosures with regard to this transaction.

Other information

The Board of Directors is responsible for the other information. The other information comprises the consolidated management report, which we obtained prior to the date of this report, and the Company's Annual Report, other than the consolidated financial statements and our auditors' report thereon, which is expected to be made available to us after that date.

Our opinion on the consolidated financial statements does not cover the other information and we do not express any form of assurance conclusion thereon, except as required by the Companies Law, Cap.113.

In connection with our audit of the consolidated financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the consolidated financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

With regards to the consolidated management report, our report in this regard is presented in the ''Report on other legal requirements'' section.

When we read the Company's Annual Report, if we conclude that there is a material misstatement therein, we are required to communicate the matter to those charged with governance and if not corrected, we will bring the matter to the attention of the members of the Company at the Company's Annual General Meeting and we will take such other action as may be required.

Responsibilities of the Board of Directors and those charged with governance for the consolidated financial statements

The Board of Directors is responsible for the preparation of consolidated financial statements that give a true and fair view in accordance with IFRS-EU and the requirements of the Companies Law, Cap. 113, and for such internal control as the Board of Directors determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, the Board of Directors is responsible for assessing the Group's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting, unless there is an intention to either liquidate the Group or to cease operations, or there is no realistic alternative but to do so.

The Board of Directors and those charged with governance are responsible for overseeing the Group's financial reporting process.

Auditors' responsibilities for the audit of the consolidated financial statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors' report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

· Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

· Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group's internal control.

· Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Board of Directors.

· Conclude on the appropriateness of the Board of Directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors' report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors' report. However, future events or conditions may cause the Group to cease to continue as a going concern.

· Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves a true and fair view.

· Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities of the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the Group audit. We remain solely responsible for our audit opinion.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditors' report.

1. Report on other legal requirements

Pursuant to the additional requirements of the Auditors Law 2017, L.53(Ι)/2017, as amended from time to time (''Law L.53(I)/2017''), and based on the work undertaken in the course of our audit, we report the following:

· In our opinion, the consolidated management report, the preparation of which is the responsibility of the Board of Directors, has been prepared in accordance with the requirements of the Companies Law, Cap 113, and the information given is consistent with the consolidated financial statements.

· In the light of the knowledge and understanding of the business and the Group's environment obtained in the course of the audit, we have not identified material misstatements in the consolidated management report.

Other Matters

Reporting responsibilities

This report, including the opinion, has been prepared for and only for the Company's members as a body in accordance with Section 69 of Law L.53(Ι)/2017 and for no other purpose. We do not, in giving this opinion, accept or assume responsibility for any other purpose or to any other person to whose knowledge this report may come to.

Comparative figures

The consolidated financial statements of the Group for the year ended 31 December 2020 were audited by another auditor who expressed an unmodified opinion on those consolidated financial statements on 14 March 2021.

The engagement partner on the audit resulting in this independent auditors' report is Antonis I. Shiammoutis.

Antonis I. Shiammoutis

Certified Public Accountant and Registered Auditor

for and on behalf of

KPMG Limited

Certified Public Accountants and Registered Auditors

14 Esperidon Street

1087 Nicosia

Cyprus

25 February 2022

	Note	31 December 2021	31 December 2020

Assets
Current assets
Cash and cash equivalents	3	46,462,179	11,866,798
Restricted cash		47	143,637
Short-term investments	4	21,001,760	19,583,523
Trade and other receivables	5	12,558,401	9,512,286
Prepayments	6	5,414,032	2,941,224
Current income tax receivable		1,532,726	646,162
Other taxes receivable	7	8,321,193	5,506,675
Inventories	8	69,756,363	63,266,389
Short-term biological assets	9	7,752,670	5,734,979
Total current assets		172,799,371	119,201,673

Non-current assets
Property, plant and equipment	11	119,159,412	87,519,088
Inventories intended for construction	11	1,604,570	3,353,330
Right-of-use assets	12	7,346,538	6,934,567
Goodwill	25	2,364,942	2,364,942
Advances paid for property, plant and equipment	6	7,355,467	6,905,003
Long-term biological assets	9	2,744,863	2,528,128
Long-term investments	10	42,527,657	42,692,320
Investments in associates		359,782	257,782
Deferred income tax assets	26	4,835,268	3,566,168
Intangible assets	13	1,144,057	619,793
Other non-current assets		79,125	205,793
Total non-current assets		189,521,681	156,946,914
Total assets		362,321,052	276,148,587

Liabilities and EQUITY
Current liabilities
Short-term borrowings	15	108,748,840	51,753,475
Lease liabilities	12	1,130,831	943,859
Trade and other payables	16	15,440,635	16,016,138
Current income tax payable		464,471	69,546
Other taxes payable	17	7,454,558	4,096,199
Provisions for other liabilities and charges		494,709	179,796
Total current liabilities		133,734,044	73,059,013

Non-current liabilities
Long-term borrowings	15	63,975,025	63,175,720
Government grants	18	9,325,530	8,536,899
Lease liabilities	12	5,535,014	4,855,508
Deferred income tax liabilities	26	1,876,244	487,049
Total non-current liabilities		80,711,813	77,055,176
Total liabilities		214,445,857	150,114,189

EQUITY
Share capital	14	12,269	12,269
Treasury shares	14	(490,607)	(490,607)
Share premium	14	26,964,479	26,964,479
Share-based payment reserve	27	1,313,691	1,313,691
Fair value reserve		49,486	49,486
Retained earnings		120,080,307	98,185,038
Equity attributable to owners of ROS AGRO PLC		147,929,625	126,034,356
Non-controlling interest		(54,430)	42
Total equity		147,875,195	126,034,398
Total liabilities and equity		362,321,052	276,148,587

Approved for issue and signed on behalf of the Board of Directors on 25 February 2022.

___________________________________ ___________________________________

Ganna Khomenko Vadim Moshkovich

Director of ROS AGRO PLC Chairman of the Board of Directors

	Note	Year ended 31 December 2021	Year ended 31 December 2020

Sales	19	222,932,439	158,971,035
Net gain on revaluation of biological assets and
agricultural produce	9	3,409,309	5,890,447
Cost of sales	20	(169,248,281)	(121,132,658)
Net (loss)/gain from trading derivatives	29	(5)	10,552
Gross profit		57,093,462	43,739,376

Distribution and selling expenses	21	(10,475,137)	(9,760,841)
General and administrative expenses	22	(10,975,898)	(7,377,449)
Reversal of provision/(provision) for impairment of loans issued	15	4,574,481	(5,070,598)
Other operating income/(expenses), net	23	2,334,177	2,293,017
Operating profit		42,551,085	23,823,505

Interest expense	24	(5,498,991)	(4,804,995)
Interest income calculated using the effective interest method		6,511,247	5,122,640
Other similar interest income		2,099,641	2,042,176
Net loss from bonds held for trading		(1,630)	(15,698)
Other financial income/(expenses), net	24	(705,356)	(1,844,130)
Profit before income tax		44,955,996	24,323,498

Income tax expense	26	(3,522,144)	(26,771)
Profit for the year		41,433,852	24,296,727
Other comprehensive income:
Items that will not be reclassified to profit or loss:
Gains less losses on investments in equity securities at fair value through other comprehensive income		-	56,556
Income tax relating to other comprehensive income		-	(7,070)
Total comprehensive income for the year		41,433,852	24,346,213

Profit/(loss)is attributable to:
- Owners of ROS AGRO PLC		41,477,865	24,359,786
- Non-controlling interest		(44,013)	(63,059)
Profit for the year		41,433,852	24,296,727

Total comprehensive income/(loss) is attributable to:
- Owners of ROS AGRO PLC		41,477,865	24,409,272
- Non-controlling interest		(44,013)	(63,059)
Total comprehensive income for the year		41,433,852	24,346,213

Earnings per ordinary share for profit attributable to the owners of ROS AGRO PLC, basic and diluted (in RR per share)	28	1 541.57	905.39


		Equity attributable to owners of ROS AGRO PLC
	Notes	Share Capital	Treasury shares	Share premium	Share-based payment reserve	Fair value reserve	Retained earnings*	Total	Non-controlling interest	Total equity
Balance at 1 January 2020		12,269	(490,607)	26,964,479	1,313,691	-	78,960,843	106,760,675	65,893	106,826,568
Total comprehensive income for the year:		-	-	-	-	49,486	24,359,786	24,409,272	(63,059)	24,346,213
Profit for the year		-	-	-	-	-	24,359,786	24,359,786	(63,059)	24,296,727
Other comprehensive income for the year		-	-	-	-	49,486	-	49,486	-	49,486

Dividends	14	-	-	-	-	-	(5,138,383)	(5,138,383)	-	(5,138,383)
Disposal of non-controlling interest	14	-	-	-	-	-	2,792	2,792	(2,792)	-
Balance at 31 December 2020		12,269	(490,607)	26,964,479	1,313,691	49,486	98,185,038	126,034,356	42	126,034,398
Balance at 1 January 2021		12,269	(490,607)	26,964,479	1,313,691	49,486	98,185,038	126,034,356	42	126,034,398
Total comprehensive income for the year:		-	-	-	-	-	41,477,865	41,477,865	(44,013)	41,433,852
Profit for the year		-	-	-	-	-	41,477,865	41,477,865	(44,013)	41,433,852

Dividends	14	-	-	-	-	-	(19,526,532)	(19,526,532)	-	(19,526,532)
Dividends to non-controlling interest shareholders		-	-	-	-	-	(523)	(523)	-	(523)
Acquisition of non-controlling interest	14	-	-	-	-	-	(55,541)	(55,541)	(10,459)	(66,000)
Balance at 31 December 2021		12,269	(490,607)	26,964,479	1,313,691	49,486	120,080,307	147,929,625	(54,430)	147,875,195

*Retained earnings and Fair value reserve in the separate financial statements of the Company are the only reserves that are available for distribution in the form of dividends.

	Note	Year ended 31 December 2021	Year ended 31 December 2020

Cash flows from operating activities
Profit before income tax		44,955,996	24,323,498
Adjustments for:
Depreciation and amortization	20, 21, 22	13,945,546	10,794,046
Interest expense	24	10,566,994	6,448,154
Government grants	23,24	(7,846,960)	(3,216,290)
Interest income		(8,610,888)	(7,164,816)
Net loss/(gain) on disposal of property, plant and equipment	23	4,424	(335,640)
Net gain on revaluation of biological assets and agricultural produce	9	(3,409,309)	(5,890,447)
Change in provision for impairment of loans issued		(4,574,481)	5,070,598
Change in provision for net realizable value of inventory		1,240,531	732,238
Interest expense on leases	12	591,558	580,276
The result from early repayment of the loan	23	-	131,363
Change in provision for impairment of receivables and prepayments		824,151	13,592
Foreign exchange loss /(gain), net	23, 24	(59,354)	1,698,846
Lost harvest write-off	23	272,407	188,536
Net loss from bonds held for trading		1,630	15,698
Change in provision for impairment of advances paid for property, plant and equipment		26,084	(29,620)
Change in other provisions	23	314,918	179,796
Gain on other investments	23	(754,538)	(560,568)
Realized deferred day-one gain	23	(552,748)	(993,558)
Loss on disposal of other assets	23	256,144	-
Gain on SolPro loans redemption	23	(605,233)	-
Other non-cash and non-operating expenses/(income), net		234,325	(87,031)
Operating cash flows before working capital changes		46,821,197	31,898,671

Change in trade and other receivables and prepayments		(6,377,712)	(1,920,133)
Change in other taxes receivable		(2,814,518)	(1,157,275)
Change in inventories		(4,236,443)	(13,280,552)
Change in biological assets		(2,340,945)	(1,888,960)
Change in trade and other payables		82,068	(209,572)
Change in other taxes payable		3,278,845	708,164
Cash generated from operations		34,412,492	14,150,343

Income taxes paid		(3,679,541)	(2,033,327)
Net cash from operating activities		30,732,951	12,117,016

Cash flows from investing activities
Purchases of property, plant and equipment		(42,029,048)	(12,405,295)
Purchases of intangible assets		(1,042,618)	(418,808)
Purchases of land lease rights		(68,772)	(86,729)
Proceeds from sales of property, plant and equipment		896,286	687,757
Purchases of inventories intended for construction		(476,322)	(1,660,923)
Change in cash on bank deposits		(18,000,000)	-
Purchases of associates		(102,000)	(92,712)
Purchases of bonds with maturity over three months	4	-	(197,523)
Proceeds from sales of bonds with maturity over three months		220,282	-
Purchases of loan issued		(2,256,313)	(13,829)
Loans repaid		22,959,494	1,012,854
Movement in restricted cash		140,894	(143,454)
Interest received		8,786,038	4,808,803
Dividends received	23	754,600	560,568
Purchases of other investments		(19,083)	-
Proceeds from sales of other investments		18,000	-
Proceeds from sales of other assets		217,591	-
Proceeds from sales of other investments		434,632	65,938
Net cash used in investing activities		(29,566,339)	(7,883,353)

Cash flows from financing activities
Proceeds from borrowings	15	107,856,022	77,932,773
Repayment of borrowings	15	(52,668,951)	(65,389,365)
Interest and other finance cost paid	15	(4,591,935)	(4,196,451)
Purchases of non-controlling interest		(66,000)	-
Dividends paid to owners of ROS AGRO PLC		(19,417,565)	(5,134,426)
Proceeds from government grants		2,879,218	2,192,483
Repayment of lease liabilities-principal	15	(335,167)	(123,044)
Other financial activities		21,631	-
Net cash from financing activities		33,677,253	5,281,970

Effect of exchange rate changes on cash and cash equivalents		(248,484)	180,386
Net increase in cash and cash equivalents		34,595,381	9,696,019
Cash and cash equivalents at the beginning of the year	3	11,866,798	2,170,779
Cash and cash equivalents at the end of the year	3	46,462,179	11,866,798

1. Background

Description of the business

These consolidated financial statements were prepared for ROS AGRO PLC (hereinafter the "Company") and its subsidiaries (hereinafter collectively with the Company, the "Group"). The Group is ultimately controlled by Mr. Vadim Moshkovich (hereinafter the "Owner"), who controls 56.2% of the issued shares

in ROS AGRO PLC as at 31 December 2021 (31 December 2020: 70.7%).

The principal activities of the Group are:

· agricultural production (cultivation of sugar-beet, grain and other agricultural crops);

· cultivation of pigs and meat processing;

· processing of raw sugar and production of sugar from sugar-beet;

· vegetable oil extraction and processing.

The registered office of ROS AGRO PLC is at 25 Aphrodite Street, CY-1060, Nicosia, Cyprus.

The Group mainly operates in the Russian Federation except for goods trading activity. The subsidiaries of the Group was incorporated and is domiciled in the Russian Federation except for Ros Agro Trading Limited and Ros Agro China Limited which are incorporated in Hong Kong.

Principal subsidiaries of the Group included into these consolidated financial statements are listed below. The Group's ownership share is the same as the voting share.


Entity	Principal activity	Group's share in the share capital,%
31 December 2021	31 December 2020
JSC Rusagro Group	Investment holding, financing	100	100
LLC Group of Companies Rusagro	Investment holding, financing	100	100
Ros Agro Trading Limited	Trading operations with goods for all principal segments	100	100
LLC RusagroTechnologii	IT services	100*	-*
	Sugar segment
LLC Rusagro-Sakhar	Sugar division trading company, sales operations	100	100
LLC Rusagro-Belgorod	Beet and raw sugar processing	100	100
LLC Rusagro-Tambov	Beet and raw sugar processing	100	100
JSC Krivets-Sakhar	Beet and raw sugar processing	100	100
JSC Kshenskiy Sugar Plant	Beet and raw sugar processing	100	100
JSC Otradinskiy Sugar Plant	Beet and raw sugar processing	100	100
JSC Hercules	Buckwheat processing plant	100	100
	Oil and Fat segment
JSC Fats and Oil Integrated Works	Oil processing	100	100
JSC Samaraagroprompererabotka	Oil extraction	100	100
LLC Primorskaya Soya	Oil extraction and processing	100**	75**
LLC Rusagro-Saratov	Oil processing	100	100
LLC Rusagro-Atkarsk	Oil extraction	100	100
LLC Rusagro-Balakovo	Oil extraction	100	100
LLC Rusagro-Zakupki	Oil and Fat raw materials procurement	100*	-*
	Meat segment
LLC Tambovsky Bacon	Cultivation of pigs	100	100
LLC Rusagro-Primorie	Cultivation of pigs	100	100
LLC Regionstroy	Construction for cultivation of pigs	100	100
	Agriculture segment
LLC Rusagro-Invest	Agriculture	100	100
LLC Agrotehnology	Agriculture	100	100
JSC Primagro	Agriculture	100	100
LLC Kshenagro	Agriculture	100	100
LLC Otradaagroinvest	Agriculture	100	100
LLC Vozrozhdenie	Agriculture	100	100
LLC Agromeliorant	Production of fertilizers	100*	-*

* Newly incorporated companies in 2021.

** The Group increased ownership interest in the company LLC Primorskaya Soya to 100% by acquiring remaining 25% stake on

22 October 2021.

1. Background (continued)

Russian Federation. The Russian Federation displays certain characteristics of an emerging market. Its economy is particularly sensitive to oil and gas prices. The legal, tax and regulatory frameworks continue to develop and are subject to frequent changes and varying interpretations (Note 31) which contribute together with other legal and fiscal impediments to the challenges faced by entities operating in the Russian Federation. The Russian economy continues to be negatively impacted by ongoing political tension in the region and international sanctions against certain Russian companies and individuals.

Starting in 2014, the United States of America, the European Union and some other countries have imposed and gradually expanded economic sanctions against a number of Russian individuals and legal entities. The imposition of the sanctions has led to increased economic uncertainty, including more volatile equity markets, a depreciation of the Russian rouble, a reduction in both local and foreign direct investment inflows and a significant tightening in the availability of credit. As a result, some Russian entities may experience difficulties accessing the international equity and debt markets and may become increasingly dependent on state support for their operations. The longer-term effects of the imposed and possible additional sanctions are difficult to determine.

In February 2022, following the recognition of self-proclaimed republics of Donetsk and Lugansk and the commencement of military operations in Ukraine by the Russian Federation, additional sanctions were introduced by the United States of America, the European Union and some other countries against Russia. Moreover, there is an increased risk that even further sanctions may be introduced. This may have significant adverse impact on Russia's economy. These events have led to depreciation of the Russian rouble, increased volatility of financial markets and significantly increased the level of economic uncertainty in the Russian business environment. Also, the COVID-19 coronavirus pandemic has continued to create additional uncertainty in the business environment. Management is taking necessary measures to ensure sustainability of the Group's operations and support its customers and employees. However, the future effects of the current economic situation and the above measures are difficult to predict, and management's current expectations and estimates could differ from actual results.

Although the COVID-19 pandemic had no significant impact on business activity, the Group is taking actions to reduce COVID-19 exposure and support its personnel. The specifics of the Group's business does not allow transferring all personnel to distance work. However, the Group did utmost to increase the share of employees handling their duties remotely. All employees were provided with personal protective equipment and antiseptics, and all surfaces and common areas at offices and enterprises were given additional disinfection. Maintaining business processes and additional focusing on occupational safety helped the Group to demonstrate strong operating and financial results in 2021.

The consolidated financial statements reflect management's assessment of the impact of the Russian business environment on the operations and the financial position of the Group. The future business environment may differ from management's assessment.

2. Summary of significant accounting policies

2.1 Basis of preparation

These consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union (EU) and the requirements of the Cyprus Companies Law, Cap.113. The consolidated financial statements have been prepared under the historical cost convention, as modified by the initial recognition of financial instruments based on fair value, financial instruments categorized at fair value through profit or loss and at fair value through other comprehensive income, biological assets that are presented at fair value less point-of-sale costs and agricultural produce which is measured at fair value less point-of-sale costs at the point of harvest. The Group entities registered in Russia keep their accounting records in Russian Roubles in accordance with Russian accounting regulations (RAR). These consolidated financial statements significantly differ from the financial statements prepared for statutory purposes under RAR in that they reflect certain adjustments, which are necessary to present the Group's consolidated financial position, results of operations, and cash flows in accordance with IFRS as adopted by the EU.

The principal accounting policies applied in the preparation of these consolidated financial statements are set out below. These policies have been consistently applied to all the periods presented unless otherwise stated.

The preparation of consolidated financial statements in conformity with IFRS as adopted by the EU requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Group's accounting policies. The areas involving a higher degree of judgement

2. Summary of significant accounting policies (continued)

2.1 Basis of preparation (continued)

or complexity, or areas where assumptions and estimates are significant to the consolidated financial statements are disclosed below in Note 2.2.

2.2 Critical Accounting Estimates and Judgements in Applying Accounting Policies

The Group makes estimates and assumptions that affect the amounts recognised in the consolidated financial statements and the carrying amounts of assets and liabilities within the next financial year. Estimates and judgements are continually evaluated and are based on management's experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Management also makes certain judgements, apart from those involving estimations, in the process of applying the accounting policies. Judgements that have the most significant effect on the amounts recognised in the consolidated financial statements and estimates that can cause a significant adjustment to the carrying amount of assets and liabilities within the next financial year include:

Useful lives of property, plant and equipment

The estimation of the useful lives of items of property, plant and equipment is a matter of judgement based on the experience with similar assets. The future economic benefits embodied in the assets are consumed principally through use. However, other factors, such as technical or commercial obsolescence and wear and tear, often result in the diminution of the economic benefits embodied in the assets. Management assesses the remaining useful lives in accordance with the current technical conditions of the assets and estimated period during which the assets are expected to earn benefits for the Group. The following primary factors are considered: (a) expected usage of the assets; (b) expected physical wear and tear, which depends on operational factors and maintenance programme; and (c) technical or commercial obsolescence arising from changes in market conditions.

Were the estimated useful lives to differ by 10% from management's estimates, the impact on depreciation for the year ended 31 December 2021 would be to increase it by RR 1,201,860 or decrease it by RR 1,468,940 (2020: increase by RR 894,928 or decrease by RR 1,093,800).

Fair value of livestock and agricultural produce

The fair value less estimated point-of-sale costs of livestock at the end of each reporting period is determined using the physiological characteristics of the animals, management expectations concerning the potential productivity and market prices of animals with similar characteristics. The fair value of the Group's bearer livestock is determined by using valuation techniques, as there were no observable market prices near the reporting date for pigs and cows of the same physical conditions, such as weight and age. The fair value of the bearer livestock was determined based on the expected quantity of remaining farrows and calves for pigs and cows, respectively, and the market prices of the young animals. The fair value of mature animals is determined based on the expected cash flow from the sale of the animals at the end of the production usage. The cash flow was calculated based on the actual prices of sales of culled animals from the Group's entities to independent processing enterprises taking place near the reporting date, and the expected weight of the animals. Future cash flows were discounted to the reporting date at a current market-determined pre-tax rate. In the fair value calculation of the immature animals of bearer livestock management considered the expected culling rate.

Key inputs used in the fair value measurement of bearer livestock of the Group were as follows:


	31 December 2021			31 December 2020
	Cows	Pigs (sows)	Pigs (boars)	Cows	Pigs (sows)	Pigs (boars)

Length of production usage in calves / farrows	-*	6	-	5	5	-
Market prices for comparable bearer livestock in the same region (in Russian Roubles/kg, excl. VAT)	-*	217	715	184	197	453

* Cows were bred for the purpose of production of milk and in 2021 were sold to external party.

2. Summary of significant accounting policies (continued)

2.2 Critical Accounting Estimates and Judgements in Applying Accounting Policies (continued)

Should the key assumptions used in determination of fair value of bearer livestock have been 10% higher/lower with all other variables held constant, the fair value of the bearer livestock as at the reporting dates would be higher or lower by the following amounts:


	31 December 2021		31 December 2020
	10% increase	10% decrease	10% increase	10% decrease
Cows
Length of production usage in calves	-*	-*	2,489	(3,026)
Market prices for comparable bearer livestock in the same region	-*	-*	10,252	(10,252)

Pigs
Length of production usage in farrows	66,079	(51,082)	50,090	(26,316)
Market prices for comparable bearer livestock in the same region	212,238	(212,238)	153,003	(153,003)

* Cows were bred for the purpose of production of milk and in 2021 were sold to external party.

The fair value of consumable livestock (pigs) is determined based on the market prices multiplied by

the livestock weight at the end of each reporting period, adjusted for the expected culling rates.

The average market price of consumable pigs being the key input used in the fair value measurement was 101.7 Russian Roubles per kilogram, excluding VAT, as at 31 December 2021 (31 December 2020: 88.7 Russian Roubles per kilogram, excluding VAT).

Should the market prices used in determination of fair value of consumable livestock have been 10% higher/lower with all other variables held constant, the fair value of the consumable livestock

as at 31 December 2021 would be higher/lower by RR 583,222 (31 December 2020: RR 465,891).

The fair value less estimated point-of-sale costs for agricultural produce at the time of harvesting was calculated based on quantities of crops harvested and the prices on deals that took place in the region

of location on or about the moment of harvesting and was adjusted for estimated point-of-sale costs

at the time of harvesting.

The average market prices (Russian Roubles/tonne, excluding VAT) used for fair value measurement

of harvested crops were as follows:


	2021	2020

Sugar beet	3,677	3,512
Wheat	12,907	10,995
Barley	11,262	9,100
Sunflower	37,211	29,726
Corn	14,984	13,302
Soya bean	47,078	32,797
Rapeseed	46,375	-

Should the market prices used in determination of fair value of harvested crops have been 10% higher/lower with all other variables held constant, the fair value of the crops harvested in 2021 would be higher/lower by RR 4,041,059 (2020: RR 3,237,356).

The fair value less estimated point-of-sale costs for unharvested crops as at 31 December 2021 was calculated based on expected yield, degree of readiness for each crop and the forward market prices. As at 31 December 2020 unharvested crops were carried at the accumulated costs incurred, which approximated the fair value.

2. Summary of significant accounting policies (continued)

2.2 Critical Accounting Estimates and Judgements in Applying Accounting Policies (continued)

The average forward market prices (Russian Roubles/tonne, excluding VAT) used for fair value measurement of unharvested crops at 31 December 2021 were as follows:


	2021

Winter wheat	13,001
Winter rapeseed	45,568

Should the forward market prices used in determination of fair value of growing crops have been 10% higher/lower with all other variables held constant, the fair value of the crops as of 31 December 2021 would be higher/lower by RR 181,700.

Fair value of investment in LLC GK Agro-Belogorie

Key inputs and assumptions used in the fair value measurement of investment in LLC GK Agro-Belogorie are disclosed in Note 10 and Note 30. Change in fair value of investment in LLC GK Agro-Belogorie is accounted within Fair value reserve line of Statement of financial position.

Estimated impairment of goodwill

The Group tests goodwill for impairment at least annually. The recoverable amounts of cash-generating units ("CGUs") have been determined based on value-in-use calculations. These calculations require the use of estimates as further detailed in Note 25.

Deferred income tax asset recognition

The recognised deferred income tax asset represents income taxes recoverable through future deductions from taxable profits and is recorded in the consolidated statement of financial position. Deferred income tax assets are recorded to the extent that realisation of the related tax benefit is probable and in relation to losses carried forward it is also based on management judgement about deductibility of expenses included in the related profit tax base. The future taxable profits and the amount of tax benefits that are probable in the future are based on a medium-term business plan prepared by management and extrapolated results thereafter. The business plan is based on management expectations that are believed to be reasonable under the circumstances. The key assumptions in the business plan are EBITDA margin and pre-tax discount rate (Notes 25, 26).

Tax legislation

Russian tax, currency and customs legislation is subject to varying interpretations (Note 31).

Assessment of existence of control over the Group of companies Solnechnye producty

Management assessed the existence of control over Group of companies Solnechnye producty (hereinafter - "Solnechnye producty") in terms of control criteria set out in IFRS 10. The Group's rights in relation to Solnechnye producty being in the stage of bankruptcy are by nature protective and do not result in power over investee. Additionally, the Group has no ability to exercise its rights in order to influence variable returns from Solnechnye producty, meaning that at least two essential control existence criteria are not met. Thus, management of the Group believes that control over Solnechnye producty does not exist.

Estimated credit loss measurement of loans issued to Solnechnye producty

Key inputs and assumptions used in the estimated credit loss measurement of loans issued to Solnechnye producty are disclosed in Note 15.

Depreciation of right-of-use assets

Extension and termination options. In determining the lease term, management considers all facts and circumstances that create an economic incentive to exercise an extension option, or not exercise a

2. Summary of significant accounting policies (continued)

2.2 Critical Accounting Estimates and Judgements in Applying Accounting Policies (continued)

termination option. Extension options (or periods after termination options) are only included in the lease term if the lease is reasonably certain to be extended (or not terminated). For leases of buildings, machinery, equipment and vehicles, the following factors are normally the most relevant:

· If there are significant penalties to terminate (or not extend), the Group is typically reasonably certain to extend (or not terminate) the lease.

· If any leasehold improvements are expected to have a significant remaining value, the Group is typically reasonably certain to extend (or not terminate) the lease.

Otherwise, the Group considers other factors including historical lease durations and the costs and business disruption required to replace the leased asset.

As for the land leases historical lease durations were used in determining the terms of right-of-use assets depreciation. Based on the management assessment and previous experience, lease term was set as 10 years as a minimum for the contracts with prolongation option.

Discount rates used for determination of lease liabilities

The Group uses its incremental borrowing rate as a base for calculation of the discount rate because the interest rate implicit in the lease cannot be readily determined. The Group's incremental borrowing rate is the rate that the Group would have to pay to borrow the funds necessary to obtain an asset of similar value to the right-of-use asset in a similar economic environment with similar terms, collateral and conditions.

10% increase in discount rate at 31 December 2021 would result in a decrease in lease liabilities of RR 271,024 (31 December 2020: RR 253,307). 10% decrease in discount rate at 31 December 2021 would result in an increase in lease liabilities of RR 299,321 (31 December 2020: RR 283,833).

2.3 Foreign currency and translation methodology

Functional and presentation currency

The functional currency of the Group's consolidated entities is the Russian Rouble (RR), which is the currency of the primary economic environment in which the Group operates. The Russian Rouble has been chosen as the presentation currency for these consolidated financial statements.

Translation of foreign currency items into functional currency

Transactions in foreign currencies are translated to Russian Roubles at the official exchange rate

of the Central Bank of the Russian Federation (CBRF) at the date of the transaction.

Monetary assets and liabilities denominated in foreign currencies at the reporting date are translated into the functional currency at the exchange rate ruling at that date. Foreign exchange gains and losses resulting from the settlement of the transactions and from the translation of monetary assets and liabilities at year-end exchange rates are recognised in profit or loss.

Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the consolidated statement of profit or loss and other comprehensive income within 'finance income or costs'. All other foreign exchange gains and losses are presented in the consolidated statement of profit or loss and other comprehensive income within 'Other operating income/(expenses), net'. Translation at year-end rates does not apply to non-monetary items that are measured at historical cost. Non-monetary items measured at fair value in a foreign currency, including equity investments, are translated using the exchange rates at the date when the fair value was determined. Effects of exchange rate changes on non-monetary items measured at fair value in a foreign currency are recorded as part of the fair value gain or loss.

2. Summary of significant accounting policies (continued)

2.4 Group accounting

Consolidation

Subsidiaries are those investees, including structured entities, that the Group controls because the Group (i) has power to direct relevant activities of the investees that significantly affect their returns, (ii) has exposure, or rights, to variable returns from its involvement with the investees, and (iii) has the ability to use its power over the investees to affect the amount of investor's returns. The existence and effect of substantive rights, including substantive potential voting rights, are considered when assessing whether the Group has power over another entity. For a right to be substantive, the holder must have practical ability to exercise that right when decisions about the direction of the relevant activities of the investee need to be made. The Group may have power over an investee even when it holds less than majority of voting power in an investee. In such a case, the Group assesses the size of its voting rights relative to the size

and dispersion of holdings of the other vote holders to determine if it has de-facto power over the investee. Protective rights of other investors, such as those that relate to fundamental changes of investee's activities or apply only in exceptional circumstances, do not prevent the Group from controlling an investee. Subsidiaries are consolidated from the date on which control is transferred to the Group (acquisition date) and are deconsolidated from the date on which control ceases.

The acquisition method of accounting is used to account for the acquisition of subsidiaries other than those acquired from parties under common control. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured at their fair values at the acquisition date, irrespective of the extent of any non-controlling interest. The Group measures non-controlling interest on a transaction by transaction basis, either at: (a) fair value, or (b) the non-controlling interest's proportionate share of net assets of the acquiree.

Goodwill is measured by deducting the fair value of net assets of the acquiree from the aggregate

of the fair value of the consideration transferred for the acquiree, the amount of non-controlling interest

in the acquiree and fair value of an interest in the acquiree held immediately before the acquisition date. Any negative amount ("negative goodwill, bargain purchase") is recognised in profit or loss, after management reassesses whether it identified all the assets acquired and all liabilities and contingent liabilities assumed and reviews appropriateness of their measurement. The consideration transferred for the acquiree is measured at the fair value of the assets given up, equity instruments issued and liabilities incurred or assumed, including fair value of assets or liabilities from contingent consideration arrangements but excludes acquisition related costs such as advisory, legal, valuation and similar professional services. Transaction costs related to the acquisition and incurred for issuing equity instruments are deducted from equity; transaction costs incurred for issuing debt as part of the business combination are deducted from the carrying amount of the debt and all other transaction costs associated with the acquisition are expensed.

Intercompany transactions, balances and unrealised gains on transactions between group companies are eliminated; unrealised losses are also eliminated unless the cost cannot be recovered. The Company

and all of its subsidiaries use uniform accounting policies consistent with the Group's policies.

Non-controlling interest is that part of the net results and of the equity of a subsidiary attributable to interests which are not owned, directly or indirectly, by the Company. Non-controlling interest forms a separate component of the Group's equity.

Associates

Associates are entities over which the Group has significant influence (directly or indirectly), but not control, generally accompanying a shareholding of between 20 and 50 percent of the voting rights. Investments in associates are accounted for using the equity method of accounting and are initially recognised at cost, and the carrying amount is increased or decreased to recognise the investor's share of changes in net asset of investee after the date of acquisition. Dividends received from associates reduce the carrying value of the investment in associates. Other post-acquisition changes in the Group's share of net assets of an associate are recognised as follows: (i) the Group's share of profits or losses of associates is recorded

2. Summary of significant accounting policies (continued)

2.4 Group accounting (continued)

in the consolidated profit or loss for the year as the share of results of associates, (ii) the Group's share of other comprehensive income is recognised in other comprehensive income and presented separately, (iii) all other changes in the Group's share of the carrying value of net assets of associates are recognised in profit or loss within the share of results of associates.

However, when the Group's share of losses in an associate is equal or exceeds its interest in the associate, including any other unsecured receivables, the Group does not recognise further losses, unless it has incurred obligations or made payments on behalf of the associate.

Unrealised gains on transactions between the Group and its associates are eliminated to the extent

of the Group's interest in the associates; unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.

Purchases of non-controlling interest

The Group applies the economic entity model to account for transactions with owners of non-controlling interest. The difference, if any, between the carrying amount of a non-controlling interest acquired and the purchase consideration is recorded as capital transaction in the consolidated statements of changes in equity.

Purchases of subsidiaries from parties under common control

Business combinations involving entities under common control (ultimately controlled by the same party, before and after the business combination, and that control is not transitory) are accounted for using

the predecessor basis of accounting. Under this method the consolidated financial statements

of the acquiree are included in the consolidated financial statements from the beginning of the earliest period presented or, if later, the date when common control was established. The assets and liabilities of the subsidiary transferred under common control are accounted for at the predecessor entity's IFRS carrying amounts using uniform accounting policies on the assumption that the Group was in existence from the date when common control was established. Any difference between the carrying amount of net assets, including the predecessor entity's goodwill, and the consideration for the acquisition is accounted for in these consolidated financial statements as an adjustment to retained earnings within equity.

Disposals of subsidiaries and associates

When the Group ceases to have control or significant influence, any retained interest in the entity is remeasured to its fair value at the date when control is lost, with the change in carrying amount recognised in profit or loss. The fair value is the initial carrying amount for the purposes of subsequently accounting for the retained interest as an associate, joint venture or financial asset. In addition, any amounts previously recognised in other comprehensive income in respect of that entity, are accounted for as if the Group had directly disposed of the related assets or liabilities. This may mean that amounts previously recognised in other comprehensive income are reclassified to profit or loss.

If the ownership interest in an associate is reduced but significant influence is retained, only a proportionate share of the amounts previously recognised in other comprehensive income are reclassified to profit or loss where appropriate.

2.5 Property, plant and equipment

Property, plant and equipment are carried at cost less accumulated depreciation and provision for impairment, if any.

Assets under construction are accounted for at purchase cost less provision for impairment, if required.

Costs of minor repairs and maintenance are expensed when incurred. Cost of replacing a major part or component of property, plant and equipment items is capitalized and the replaced part is retired.

Upon sale or retirement, the cost and related accumulated depreciation are eliminated from the consolidated financial statements. Gains and losses on disposals are determined by comparing proceeds with the carrying amount and are included in operating profit or loss for the year within other operating

2. Summary of significant accounting policies (continued)

2.5 Property, plant and equipment (continued)

income and expenses.

2.6 Depreciation

Depreciation on property, plant and equipment other than land and assets under construction is calculated using the straight-line method to allocate their cost to the residual values over their estimated useful lives:


Asset category	Useful life, years
Buildings	15-50
Constructions	5-50
Machinery, vehicles and equipment	2-20
Other	4-6

Assets are depreciated on a straight-line basis from the month following the date they are ready for use.

The residual value of an asset is the estimated amount that the Group would currently obtain

from disposal of the asset less the estimated costs of disposal, if the asset were already of the age and in the condition expected at the end of its useful life. The residual value of an asset is nil if the Group expects to use the asset until the end of its physical life. The assets' residual values and useful lives are reviewed, and adjusted if appropriate, at each reporting date.

2.7 Biological assets and agricultural produce

Biological assets of the Group consist of unharvested crops (grain crops, sugar beets and other plant crops) and pigs livestock.

Livestock is measured at their fair value less estimated point-of-sale costs. Fair value at initial recognition is assumed to be approximated by the purchase price incurred. Point-of-sale costs include all costs that would be necessary to sell the assets. All the gains or losses arising from initial recognition of biological assets and from changes in fair-value-less-cost-to-sell of biological assets less the amounts of these gains or losses related to the realised biological assets are included in a separate line "Net gain/ (loss)

on revaluation of biological assets and agricultural produce" above the gross profit line.

At the year-end unharvested crops are measured at fair value less estimated point-of-sale costs. A gain

or loss from the changes in the fair value less estimated point-of-sale costs of unharvested crops less the amount of such gain or loss related to the realisation of agricultural products is included as a separate line "Net gain/ (loss) on revaluation of biological assets and agricultural produce" above the gross profit line.

Upon harvest, grain crops, sugar beets and other plant crops are included into inventory for further processing or for sale and are initially measured at their fair value less estimated point-of-sale costs at the time of harvesting. A gain or loss arising on initial recognition of agricultural produce at fair value less estimated point-of-sale costs of unharvested crops less the amount of such gain or loss related to the realisation of agricultural products is recognised in profit or loss in the period in which it arises.

Bearer livestock is classified as non-current assets; consumable livestock and unharvested crops are classified as current assets in the consolidated statement of financial position.

2.8 Goodwill

Goodwill on acquisitions of subsidiaries is presented separately in the consolidated statement of financial position. Goodwill is carried at cost less accumulated impairment losses, if any. The Group tests goodwill for impairment at least annually and whenever there are indications that goodwill may be impaired. Goodwill is allocated to the cash-generating units, or groups of cash-generating units, that are expected to benefit from the synergies of the business combination. Such units or groups of units represent the lowest level at which the Group monitors goodwill and are not larger than an operating segment. Gains or losses on disposal of an operation within a cash-generating unit to which goodwill has been allocated include the carrying amount of goodwill associated with the operation disposed of, generally measured on the basis of the relative values of the operation disposed of and the portion of the cash-generating unit which is retained.

2. Summary of significant accounting policies (continued)

2.9 Intangible assets

The Group's intangible assets other than goodwill have definite useful lives and primarily include capitalised computer software, patents, trademarks and licences. Acquired computer software licences, patents and trademarks are capitalised on the basis of the costs incurred to acquire and bring them to use.

Intangible assets are amortised using the straight-line method over their useful lives:


Asset category	Useful life, years

Trademarks	5-12
Software licences	1-3
Capitalised internal software development costs	3-5
Other licences	1-3

If impaired, the carrying amount of intangible assets is written down to the higher of value in use and fair value less costs to sell.

2.10 Impairment of non-current assets

The Group's non-current assets except for deferred income tax, biological assets and financial assets are tested for impairment in accordance with the provisions of IAS 36, Impairment of Assets. The Group makes an assessment whether there is any indication that an asset may be impaired at each reporting date, except for goodwill which is tested at least annually regardless of whether there are any indications

of impairment. If any such indication exists, an estimate of the recoverable amount of the asset is made. IAS 36 requires an impairment loss to be recognised whenever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount of an asset is the higher of the asset's fair value less costs to sell and its value in use. Value in use is the present value of estimated future cash flows expected to arise from the continuing use of an asset and from its disposal at the end of its life.

2.11 Financial instruments

Financial instruments - key measurement terms

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The best evidence of fair value is the price in an active market. An active market is one in which transactions for the asset or liability take place with sufficient frequency and volume to provide pricing information on an ongoing basis.

Fair value of financial instruments traded in an active market is measured as the product of the quoted price for the individual asset or liability and the number of instruments held by the entity. This is the case even if a market's normal daily trading volume is not sufficient to absorb the quantity held and placing orders to sell the position in a single transaction might affect the quoted price.

Valuation techniques such as discounted cash flow models or models based on recent arm's length transactions or consideration of financial data of the investees are used to measure fair value of certain financial instruments for which external market pricing information is not available. Fair value measurements are analysed by level in the fair value hierarchy as follows: (i) level one are measurements at quoted prices (unadjusted) in active markets for identical assets or liabilities, (ii) level two measurements are valuations techniques with all material inputs observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices), and (iii) level three measurements are valuations not based on solely observable market data (that is, the measurement requires significant unobservable inputs). Transfers between levels of the fair value hierarchy are deemed to have occurred at the end of the reporting period.

Transaction costs are incremental costs that are directly attributable to the acquisition, issue or disposal of a financial instrument. An incremental cost is one that would not have been incurred if the transaction had not taken place. Transaction costs include fees and commissions paid to agents (including employees acting as selling agents), advisors, brokers and dealers, levies by regulatory agencies and securities exchanges, and transfer taxes and duties. Transaction costs do not include debt premiums or discounts, financing costs or internal administrative or holding costs.

2. Summary of significant accounting policies (continued)

2.11 Financial instruments (continued)

Amortised cost ("AC") is the amount at which the financial instrument was recognised at initial recognition less any principal repayments, plus accrued interest, and for financial assets less any allowance for expected credit losses ("ECL"). Accrued interest includes amortisation of transaction costs deferred at initial recognition and of any premium or discount to the maturity amount using the effective interest method. Accrued interest income and accrued interest expense, including both accrued coupon and amortised discount or premium (including fees deferred at origination, if any), are not presented separately and are included in the carrying values of the related items in the consolidated statement of financial position.

The effective interest method is a method of allocating interest income or interest expense over the relevant period, so as to achieve a constant periodic rate of interest (effective interest rate) on the carrying amount. The effective interest rate is the rate that exactly discounts estimated future cash payments or receipts (excluding future credit losses) through the expected life of the financial instrument or a shorter period, if appropriate, to the gross carrying amount of the financial instrument. The effective interest rate discounts cash flows of variable interest instruments to the next interest repricing date, except for the premium or discount which reflects the credit spread over the floating rate specified in the instrument, or other variables that are not reset to market rates. Such premiums or discounts are amortised over the whole expected life of the instrument. The present value calculation includes all fees paid or received between parties to the contract that are an integral part of the effective interest rate. For assets that are purchased or originated credit impaired ("POCI") at initial recognition, the effective interest rate is adjusted for credit risk, i.e. it is calculated based on the expected cash flows on initial recognition instead of contractual payments.

Initial recognition and measurement of financial instruments

A financial instrument is recognised when the Group becomes a party to the contractual provisions

of the instrument. The Group's financial assets and liabilities are initially recorded at fair value. Fair value at initial recognition is best evidenced by the transaction price. A gain or loss on initial recognition is only recorded if there is a difference between fair value and transaction price which can be evidenced by other observable current market transactions in the same instrument or by a valuation technique whose inputs include only data from observable markets. After the initial recognition, an expected credit loss allowance is recognised for financial assets measured at amortised cost, resulting in an immediate accounting loss.

All purchases and sales of financial assets that require delivery within the time frame established by regulation or market convention ("regular way" purchases and sales) are recorded at trade date, which is the date on which the Group commits to deliver a financial asset. All other purchases are recognised when the Group becomes a party to the contractual provisions of the instrument.

Financial assets - classification and subsequent measurement - measurement categories

The Group classifies financial assets in the following measurement categories: fair value through profit and loss, fair value through other comprehensive income and amortised cost. The classification and subsequent measurement of debt financial assets depends on: (i) the Group's business model for managing the related assets portfolio and (ii) the cash flow characteristics of the asset. Equity investments at fair value through other comprehensive income are subsequently measured at fair value. Dividends are recognised as income in profit or loss unless the dividend clearly represents a recovery of part of the cost of the investment. Other net gains and losses are recognised in other comprehensive income and are never reclassified to profit or loss.

Financial assets - classification and subsequent measurement - business model

The business model reflects how the Group manages the assets in order to generate cash flows - whether the Group's objective is: (i) solely to collect the contractual cash flows from the assets ("hold to collect contractual cash flows",) or (ii) to collect both the contractual cash flows and the cash flows arising from the sale of assets ("hold to collect contractual cash flows and sell") or, if neither of (i) and (ii) is applicable, the financial assets are classified as part of "other" business model and measured at fair value through profit and loss.

Business model is determined for a group of assets (on a portfolio level) based on all relevant evidence about the activities that the Group undertakes to achieve the objective set out for the portfolio available at the date of the assessment. Factors considered by the Group in determining the business model include the purpose and composition of a portfolio, past experience on how the cash flows for the respective assets were collected, how risks are assessed and managed, how the assets' performance is assessed and how managers are compensated.

2. Summary of significant accounting policies (continued)

2.11 Financial instruments (continued)

Financial assets - classification and subsequent measurement - cash flow characteristics

Where the business model is to hold assets to collect contractual cash flows or to hold contractual cash flows and sell, the Group assesses whether the cash flows represent solely payments of principal and interest (SPPI). Financial assets with embedded derivatives are considered in their entirety when determining whether their cash flows are consistent with the SPPI feature. In making this assessment, the Group considers whether the contractual cash flows are consistent with a basic lending arrangement, i.e. interest includes only consideration for credit risk, time value of money, other basic lending risks and profit margin.

Where the contractual terms introduce exposure to risk or volatility that is inconsistent with a basic lending arrangement, the financial asset is classified and measured at fair value through profit and loss. The SPPI assessment is performed on initial recognition of an asset and it is not subsequently reassessed.

All financial instruments except those that are measured at fair value meet the SPPI criteria and are recognised at amortised cost. The Group has some instruments that meet SPPI and are held for trading and to collect,those that are recognised at fair value through profit and loss and at fair value through other comprehensive income.

Financial assets - reclassification

Financial instruments are reclassified only when the business model for managing the portfolio as a whole changes. The reclassification has a prospective effect and takes place from the beginning of the first reporting period that follows after the change in the business model.

Financial assets impairment - credit loss allowance for expected credit loss

The Group assesses, on a forward-looking basis, the expected credit loss for debt instruments measured at amortised cost and fair value through other comprehensive income and for the exposures arising from loan commitments and financial guarantee contracts, for contract assets. The Group measures expected credit loss and recognises Net impairment losses on financial and contract assets at each reporting date. The measurement of expected credit loss reflects: (i) an unbiased and probability weighted amount that is determined by evaluating a range of possible outcomes, (ii) time value of money and (iii) all reasonable and supportable information that is available without undue cost and effort at the end of each reporting period about past events, current conditions and forecasts of future conditions.

2. Summary of significant accounting policies (continued)

2.11 Financial instruments (continued)

Debt instruments measured at amortised cost and contract assets are presented in the consolidated statement of financial position net of the allowance for expected credit loss. For loan commitments and financial guarantees, a separate provision for expected credit loss is recognised as a liability in the consolidated statement of financial position. For debt instruments at fair value through other comprehensive income, changes in amortised cost, net of allowance for expected credit loss, are recognised in profit or loss and other changes in carrying value are recognised in other comprehensive income as gains less losses on debt instruments at fair value through other comprehensive income.

The Group applies a three-stage model for impairment, based on changes in credit quality since initial recognition. A financial instrument that is not credit-impaired on initial recognition is classified in Stage 1. Financial assets in Stage 1 have their expected credit loss measured at an amount equal to the portion of lifetime expected credit loss that results from default events possible within the next 12 months or until contractual maturity, if shorter. If the Group identifies a significant increase in credit risk since initial recognition, the asset is transferred to Stage 2 and its expected credit loss is measured based on expected credit loss on a lifetime basis, that is, up until contractual maturity but considering expected prepayments, if any. Refer to Note 30 for a description of how the Group determines when a significant increase in credit risk has occurred. If the Group determines that a financial asset is credit-impaired, the asset is transferred to Stage 3 and its expected credit loss is measured as a Lifetime expected credit loss. The Group's definition of credit impaired assets and definition of default is explained in Note 30. For financial assets that are purchased or originated credit-impaired, the expected credit loss is always measured as a Lifetime expected credit loss. Note 30 provides information about inputs, assumptions and estimation techniques used in measuring expected credit loss, including an explanation of how the Group incorporates forward-looking information in the expected credit loss models.

The Group applies the IFRS 9 simplified approach to measuring expected credit losses which uses a lifetime expected loss allowance for all trade and other receivables.

To measure the expected credit losses, trade and other receivables have been grouped based on shared credit risk characteristics and the days past due.

The expected loss rates are based on the payment profiles of sales over a period of 36 month before each balance sheet date and the corresponding historical credit losses experienced within this period. The historical loss rates are adjusted to reflect current and forward-looking information on macroeconomic factors affecting the ability of the customers to settle the receivables. The Group has identified the GDP and the unemployment rate of the countries in which it sells its goods and services to be the most relevant factors, and accordingly adjusts the historical loss rates based on expected changes in these factors.

Financial assets - write-off. Financial assets are written-off, in whole or in part, when the Group exhausted all practical recovery efforts and has concluded that there is no reasonable expectation of recovery. The write-off represents a derecognition event. The Group may write-off financial assets that are still subject to enforcement activity when the Group seeks to recover amounts that are contractually due, however, there is no reasonable expectation of recovery.

Financial assets - derecognition

The Group derecognises financial assets when (a) the assets are redeemed or the rights to cash flows from the assets otherwise expire or (b) the Group has transferred the rights to the cash flows from the financial assets or entered into a qualifying pass-through arrangement whilst (i) also transferring substantially all the risks and rewards of ownership of the assets or (ii) neither transferring nor retaining substantially all the risks and rewards of ownership but not retaining control.

Control is retained if the counterparty does not have the practical ability to sell the asset in its entirety to an unrelated third party without needing to impose additional restrictions on the sale.

2. Summary of significant accounting policies (continued)

2.11 Financial instruments (continued)

Financial assets - modification. The Group sometimes renegotiates or otherwise modifies the contractual terms of the financial assets. The Group assesses whether the modification of contractual cash flows is substantial considering, among other, the following factors: any new contractual terms that substantially affect the risk profile of the asset, significant change in interest rate, change in the currency denomination, new collateral or credit enhancement that significantly affects the credit risk associated with the asset or a significant extension of a loan when the borrower is not in financial difficulties.

If the modified terms are substantially different, the rights to cash flows from the original asset expire and the Group derecognises the original financial asset and recognises a new asset at its fair value. The date of renegotiation is considered to be the date of initial recognition for subsequent impairment calculation purposes, including determining whether a SICR has occurred. The Group also assesses whether the new loan or debt instrument meets the SPPI criterion. Any difference between the carrying amount of the original asset derecognised and fair value of the new substantially modified asset is recognised in profit or loss, unless the substance of the difference is attributed to a capital transaction with owners.

In a situation where the renegotiation was driven by financial difficulties of the counterparty and inability to make the originally agreed payments, the Group compares the original and revised expected cash flows to assets whether the risks and rewards of the asset are substantially different as a result of the contractual modification. If the risks and rewards do not change, the modified asset is not substantially different from the original asset and the modification does not result in derecognition. The Group recalculates the gross carrying amount by discounting the modified contractual cash flows by the original effective interest rate (or credit-adjusted effective interest rate for POCI financial assets), and recognises a modification gain or loss in profit or loss.

Financial liabilities - measurement categories

Financial liabilities are classified as subsequently measured at amortised cost, except for (i) financial liabilities at fair value through profit and loss: this classification is applied to derivatives, financial liabilities held for trading (e.g. short positions in securities), contingent consideration recognised by an acquirer in a business combination and other financial liabilities designated as such at initial recognition and (ii) financial guarantee contracts and loan commitments.

Financial liabilities designated at fair value through profit and loss

The Group may designate certain liabilities at fair value through profit and loss at initial recognition. Gains and losses on such liabilities are presented in profit or loss except for the amount of change in the fair value that is attributable to changes in the credit risk of that liability (determined as the amount that is not attributable to changes in market conditions that give rise to market risk), which is recorded in other comprehensive income and is not subsequently reclassified to profit or loss. This is unless such a presentation would create, or enlarge, an accounting mismatch, in which case the gains and losses attributable to changes in credit risk of the liability are also presented in profit or loss.

Financial liabilities - derecognition

Financial liabilities are derecognised when they are extinguished (i.e. when the obligation specified in the contract is discharged, cancelled or expires).

Offsetting financial instruments

Financial assets and liabilities are offset and the net amount reported in the consolidated statements of financial position only when there is a legally enforceable right to offset the recognised amounts, and there is an intention to either settle on a net basis, or to realise the asset and settle the liability simultaneously. Such a right of set off (a) must not be contingent on a future event and (b) must be legally enforceable in all of the following circumstances: (i) in the normal course of business, (ii) in the event of default and (iii) in the event of insolvency or bankruptcy. There were no offsets of financial assets and liabilities as at 31 December 2021.

2. Summary of significant accounting policies (continued)

2.11 Financial instruments (continued)

Presentation of results from sugar trading derivatives

The Group was engaged in raw sugar derivative trading transactions through an agent on ICE Futures US primarily in order to manage the raw sugar purchase price risk (Note 30). As such transactions are directly related to the core activity of the Group, their results are presented above gross profit as 'Net gain from trading derivatives' in the consolidated statement of profit or loss and other comprehensive income. Management believes that the presentation above gross profit line appropriately reflects the nature of derivative operations of the Group.

2.12 Cash and cash equivalents

Cash and cash equivalents comprise cash in hand, cash held on demand with banks, bank deposits with original maturity of less than three months, other short-term highly liquid investments with original maturities of three months or less. Cash and cash equivalents are carried at amortised cost because: (i) they are held for collection of contractual cash flows and those cash flows represent SPPI, and (ii) they are not designated at fair value through profit and loss. Features mandated solely by legislation, such as the bail-in legislation in certain countries, do not have an impact on the SPPI test, unless they are included in contractual terms such that the feature would apply even if the legislation is subsequently changed.

Restricted balances are excluded from cash and cash equivalents for the purposes of the consolidated statement of cash flows. Balances restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period are included in non-current assets.

2.13 Investments

Bank deposits with original maturities of more than three months and less than twelve months are classified as short-term investments and are carried at amortised cost using the effective interest method.

Bank deposits with original maturity of more than twelve months are classified as long-term and are carried at amortised cost.

Bond held for trading are securities which are acquired solely to generate a profit from short-term fluctuations in price or trader's margin or are included in a portfolio in which a pattern of short-term trading exists. These financial assets are classified as part of "other" business model and measured at fair value through profit and loss. Business model is determined for a group of assets (on a portfolio level) based on all relevant evidence about the activities that the Group undertakes to achieve the objective set out for the portfolio available at the date of the assessment. Factors considered by the Group in determining the business model include the purpose and composition of a portfolio, past experience on how the cash flows for the respective assets were collected, how risks are assessed and managed, how the assets' performance is assessed and how managers are compensated.

2.14 Prepayments

Prepayments classified as current assets represent advance payments to suppliers for goods and services. Prepayments for construction or acquisition of property, plant and equipment and prepayments for intangible assets are classified as non-current assets. Prepayments are carried at cost less provisions for impairment, if any. If there is an indication that the assets, goods or services relating to a prepayment will not be received, the carrying value of the prepayment is written down accordingly and a corresponding impairment loss is recognised in profit or loss for the year.

2.15 Inventories

Inventories are stated at the lower of cost or net realisable value. Cost is determined on the weighted average basis. The cost of finished goods and work in progress comprises raw materials, direct labour, other direct costs and related production overheads (based on normal operating capacity) but excludes borrowing costs. Net realisable value is the estimated selling price in the ordinary course of business, less selling expenses.

2. Summary of significant accounting policies (continued)

2.15 Inventories (continued)

Raw materials intended for the operating activities of the Group, finished goods and work in progress are classified as current assets. Materials intended for construction are classified as non-current assets as "Inventories intended for construction".

2.16 Borrowings

Borrowings are recognised initially at their fair value, net of transaction costs incurred. In subsequent periods, borrowings are stated at amortised cost using the effective interest method; any difference between the amount at initial recognition and the redemption amount is recognised as interest expense over the period of the borrowings.

Borrowing costs directly attributable to the acquisition, construction or production of assets that necessarily take a substantial time to get ready for intended use or sale (qualifying assets) are capitalised as part of the costs of those assets.

Capitalisation of borrowing costs continues up to the date when the assets are substantially ready

for their use or sale.

The Group capitalises borrowing costs that could have been avoided if it had not made capital expenditure on qualifying assets. Borrowing costs capitalised are calculated at the Group's average funding cost (the weighted average interest cost is applied to the expenditures on the qualifying assets), except to the extent that funds are borrowed specifically for the purpose of obtaining a qualifying asset. Where this occurs, actual borrowing costs incurred less any investment income on the temporary investment of those borrowings are capitalised.

2.17 Trade and other payables

Trade and other payables are recognised when the counterparty has performed its obligations under

the contract, and are carried at amortised cost using the effective interest method.

2.18 Value added tax

Output value added tax related to sales is payable to tax authorities on the earlier of (a) collection of the receivables from customers or (b) delivery of the goods or services to customers. Input VAT is generally recoverable against output VAT upon receipt of the VAT invoice. The tax authorities permit the settlement of VAT on a net basis. VAT related to purchases where all the specified conditions for recovery have not been met yet is recognised in the consolidated statements of financial position and disclosed separately within other taxes receivable, while input VAT that has been claimed is netted off with the output VAT payable. Where provision has been made for impairment of receivables, impairment loss is recorded for the gross amount of the debtor, including VAT.

2.19 Other taxes payable

Other taxes payable comprises liabilities for taxes other than on income outstanding at the reporting date, accrued in accordance with legislation enacted or substantively enacted by the end of the reporting period.

2.20 Income tax

Income taxes have been provided for in the consolidated financial statements in accordance with legislation enacted or substantively enacted by the end of the reporting period. The income tax charge or credit comprises current tax and deferred income tax and is recognised in profit or loss for the year.

Current tax

Current tax is the amount expected to be paid to or recovered from the taxation authorities in respect

of taxable profits or losses for the current and prior periods.

2. Summary of significant accounting policies (continued)

2.20 Income tax (continued)

Deferred income tax

Deferred income tax is provided in full, using the balance sheet liability method, on tax losses carry forward and temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements. In accordance with the initial recognition exemption, deferred income taxes are not recorded for temporary differences on initial recognition of an asset or a liability in a transaction other than a business combination if the transaction, when initially recorded, affects neither accounting nor taxable profit. Deferred income tax balances are measured at tax rates enacted or substantively enacted at the end of the reporting period, which are expected to apply to the period when the temporary differences will reverse or the tax loss carry forwards will be utilised.

Deferred income tax assets for deductible temporary differences and tax loss carry forwards are recorded only to the extent that it is probable that the temporary difference will reverse in the future and there is sufficient future taxable profit available against which the deductions can be utilised.

Deferred income tax is provided on temporary differences arising on investments in subsidiaries

and associates, except where the timing of the reversal of the temporary difference is controlled by

the Group and it is probable that the temporary difference will not reverse in the foreseeable future.

Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities and when the deferred income taxes assets and liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities where there is an intention to settle the balances on a net basis. Deferred income tax assets and liabilities are netted only within the individual companies of the Group.

The Group's uncertain tax positions are reassessed by management at the end of each reporting period. Liabilities are recorded for income tax positions that are determined by management as more likely than not to result in additional taxes being levied if the positions were to be challenged by the tax authorities. The assessment is based on the interpretation of tax laws that have been enacted or substantively enacted by the end of the reporting period and any known court or other rulings on such issues. Liabilities for penalties, interest and taxes other than on income are recognised based on management's best estimate of the expenditure required to settle the obligations at the end of the reporting period.

2.21 Employee benefits

Payroll costs and related contributions

Wages, salaries, contributions to the Russian Federation state pension and social insurance funds, paid annual leave and sick leave, bonuses, and non-monetary benefits are accrued in the year, in which

the associated services are rendered by the employees of the Group.

Pension costs

The Group contributes to the Russian Federation state pension fund on behalf of its employees and has no obligation beyond the payments made. The contribution was approximately 21.1% (2020: 21.2%) of the employees' gross pay and is expensed in the same period as the related salaries and wages.

The Group does not have any other legal or constructive obligation to make pension or other similar benefit payments to its employees.

Share-based payment transactions

The Group accounts for share-based compensation in accordance with IFRS 2, Share-based Payment. The fair value of the employee services received in exchange for the grant of the equity instruments is recognized as an expense. The total amount to be expensed over the vesting period is determined

by reference to the fair value of the instruments granted measured at the grant date. For share-based compensation made to employees by shareholders, an increase to share-based payment reserve in equity is recorded equal to the associated compensation expense each period.

2. Summary of significant accounting policies (continued)

2.22 Provisions for liabilities and charges

Provisions for liabilities and charges are non-financial liabilities of uncertain timing or amount. They are accrued when the Group has a present legal or constructive obligation as a result of past events, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and a reliable estimate of the amount of the obligation can be made. Provisions are measured at the present value of the expenditures expected to be required to settle the obligation using a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the obligation. The increase in the provision due to the passage of time is recognised as an interest expense within finance costs. Where the Group expects a provision to be reimbursed, for example, under an insurance contract, the reimbursement is recognised as a separate asset but only when the reimbursement is virtually certain.

2.23 Revenue recognition

Revenue is income arising in the course of the Group's ordinary activities. Revenue is recognised in the amount of transaction price. Transaction price is the amount of consideration to which the Group expects to be entitled in exchange for transferring control over promised goods or services to a customer, excluding the amounts collected on behalf of third parties. Revenue is recognised net of discounts and value added taxes.

Sales of goods. Sales are recognised when control of the good has transferred, being when the goods are delivered to the customer, the customer has full discretion over the goods, and there is no unfulfilled obligation that could affect the customer's acceptance of the goods. Delivery occurs when the goods have been shipped to the specific location, the risks of obsolescence and loss have been transferred to the customer, and either the customer has accepted the goods in accordance with the contract, the acceptance provisions have lapsed, or the Group has objective evidence that all criteria for acceptance have been satisfied.

Revenue from the sales with discounts is recognised based on the price specified in the contract, net of the estimated discounts. Accumulated experience is used to estimate and provide for the discounts, using the expected value method, and revenue is only recognised to the extent that it is highly probable that a significant reversal will not occur.

A receivable is recognised when the goods are delivered as this is the point in time that the consideration is unconditional because only the passage of time is required before the payment is due.

If the Group provides any additional services to the customer after control over goods has passed, revenue from such services is considered to be a separate performance obligation and is recognised over the time of the service rendering.

Contract assets and liabilities are not separately presented in the consolidated statement of financial position as they are not material.

Commodity loans. The Group provides and obtains commodity loans from other grain traders at the point of transhipment by entering into sales and purchase agreements. Commodity loans are usually returned within several months by reverse transactions between the same parties on identical terms.

These transactions are in substance commodity loans, rather than sale and purchase transactions. Therefore, revenue and cost of sales attributable to these transactions are eliminated from the consolidated statement of profit or loss and other comprehensive income.

No commodity loans were obtained/provided in 2021.

2. Summary of significant accounting policies (continued)

2.23 Revenue recognition (continued)

Sales of transportation services.

Revenue from providing transportation services is recognised in the accounting period in which these services are rendered. For fixed-price contracts, revenue is recognised based on the actual service provided to the end of the reporting period as a proportion of the total services to be provided because the customer receives and uses the benefits simultaneously.

Where the contracts include multiple performance obligations, the transaction price is allocated to each separate performance obligation based on the stand-alone selling prices. Where these are not directly observable, they are estimated based on expected cost-plus margin.

Interest income. Interest income is recorded for all debt instruments, other than those at fair value through profit and loss on an accrual basis using the effective interest method. This method defers, as part of interest income, all fee received between the parties to the contract that are an integral part of the effective interest rate. Interest income on debt instruments at fair value through profit and loss calculated at nominal interest rate is presented within 'finance income' line in profit or loss.

2.24 Segment reporting

Operating segments are reported in a manner consistent with the internal reporting provided

to the Group's chief operating decision maker. Segments whose revenue, result or assets are ten percent or more of all the segments are reported separately.

2.25 Government grants

Government grants comprise compensation of interest expense under bank loans and government grants relating to costs and property, plant and equipment.

Government grants relating to property, plant and equipment are included in non-current liabilities

as deferred government grants and are credited to profit or loss on a straight-line basis over the expected lives of the related assets. Government grants relating to costs are deferred and recognised in profit

or loss as other operating income over the period necessary to match them with the costs that they are intended to compensate.

Compensation of interest expense under bank loans is credited to profit or loss over the periods

of the related interest expense unless this interest was capitalised into the carrying value of assets

in which case it is included in non-current liabilities as government grants and credited to profit or loss

on a straight-line basis over the expected lives of the related assets.

The benefit of a government loan at a below-market rate of interest is treated as a government grant.

The loan is recognised and measured in accordance with IFRS 9 Financial Instruments: Recognition

and Measurement. The benefit of the below-market rate of interest is measured as the difference between the initial carrying value of the loan determined in accordance with IFRS 9 and the proceeds received.

The differences between nominal and market interest rate is recognized as interest expenses and government grants in the consolidated statement of profit or loss and other comprehensive income or in the consolidated statement of financial position.

Government grants are recognized at their fair value when there is reasonable assurance that the grant will be received, and the Group will comply with all attached conditions.

Government grants cash inflows are presented in the financing activities section of the consolidated statement of cash flows.

2. Summary of significant accounting policies (continued)

2.26 Dividends

Dividends are recorded as a liability and deducted from equity in the period in which they are declared and approved, appropriately authorised and are no longer at the discretion of the Group. Any dividends declared after the reporting period and before the consolidated financial statements are authorised for issue are disclosed in the subsequent events note.

2.27 Share capital and share premium

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares are shown in equity as a deduction, net of tax, from the proceeds. Any excess of the fair value of consideration receivable over the par value of shares issued is recorded as share premium in equity. Share premium can only be resorted to for limited purposes, which do not include the distribution of dividends, and is otherwise subject to the provisions of the Cyprus Companies Law on reduction of share capital.

2.28 Treasury shares

Where the Company or its subsidiaries purchase the Company's equity instruments, the consideration paid, including any directly attributable incremental costs, net of income taxes, is deducted from equity attributable to the Company's owners until the equity instruments are cancelled, reissued or disposed of. Where such equity instruments are subsequently sold or reissued, any consideration received, net of any directly attributable incremental transaction costs and the related income tax effects, is included in equity attributable to the Company's owners.

2.29 Amendments of the consolidated financial statements after issue

Any changes to these consolidated financial statements after issue require approval of the Group's management and the Board of Directors who authorised these consolidated financial statements for issue.

2.30 Right-of-use assets

The Group leases various land, buildings, machinery, equipment and vehicles. Assets arising from a lease are initially measured on a present value basis.

Right-of-use assets are measured at cost comprising the following:

· the amount of the initial measurement of lease liability,

· any lease payments made at or before the commencement date less any lease incentives received,

· any initial direct costs.

Right-of-use assets are generally depreciated over the shorter of the asset's useful life and the lease term on a straight-line basis. If the Group is reasonably certain to exercise a purchase option, the right-of-use asset is depreciated over the underlying assets' useful lives. Useful lives of right-of-use of land is limited by contract terms but are not less than 10 years for contracts with prolongation option (Note 12). Depreciation on the items of the right-of-use assets is calculated using the straight-line method over their estimated useful lives as follows:


	Useful lives in years

Land	1 to 50
Buildings	1 to 20
Machinery and equipment	1 to 7
Vehicles	1 to 5

2. Summary of significant accounting policies (continued)

2.31 Lease liabilities

Liabilities arising from a lease are initially measured on a present value basis. Lease liabilities include the net present value of the following lease payments:

· fixed payments (including in-substance fixed payments), less any lease incentives receivable,

· variable lease payment that are based on an index or a rate, initially measured using the index or rate as at the commencement date,

· the exercise price of a purchase option if the Group is reasonably certain to exercise that option, and

· payments of penalties for terminating the lease, if the lease term reflects the Group exercising that option.

Extension and termination options are included in a number of land plots, buildings, machinery, equipment and vehicles across the Group. These terms are used to maximise operational flexibility in terms of managing the assets used in the Group's operations. The majority of extension and termination options held are exercisable only by the Group and not by the respective lessor. Extension options (or period after termination options) are only included in the lease term if the lease is reasonably certain to be extended (or not terminated). Lease payments to be made under reasonably certain extension options are also included in the measurement of the liability.

The lease payments are discounted using the interest rate implicit in the lease. If that rate cannot be readily determined, which is generally the case for leases of the Group, the Group's incremental borrowing rate is used, being the rate that the Group would have to pay to borrow the funds necessary to obtain an asset of similar value to the right-of-use asset in a similar economic environment with similar terms, collateral and conditions.

To determine the incremental borrowing rate, the Group:

· where possible, uses recent third-party financing received by the individual lessee as a starting point, adjusted to reflect changes in financing conditions since third party financing was received,

· makes adjustments specific to the lease, e.g. term, country, currency and collateral.

The Group is exposed to potential future increases in variable lease payments based on an index or rate, which are not included in the lease liability until they take effect. When adjustments to lease payments based on an index or rate take place, the lease liability is reassessed and adjusted against the right-of-use asset.

Lease payments are allocated between principal and finance costs. The finance costs are charged to profit or loss over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period.

Payments associated with short-term leases of equipment and vehicles and all leases of low-value assets are recognised on a straight-line basis as an expense in profit or loss. Short-term leases are leases with a lease term of 12 months or less. Low-value assets comprise IT equipment and small items of office furniture with value of RR 300 or less.

2.32 Adoption of new or revised standards and interpretations

During the current year the Group adopted all the new and revised International Financial Reporting Standards (IFRS) that are relevant to its operations and are effective for accounting periods beginning on 1 January 2021.

2. Summary of significant accounting policies (continued)

2.32 Adoption of new or revised standards and interpretations (continued)

The following amended standard became effective from 1 January 2021, but did not have any material impact on the Group:

The Group has initially adopted Interest Rate Benchmark Reform - Phase 2 (Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16) from 1 January 2021.

The Group applied the Phase 2 amendments retrospectively. Since the Group had no transactions for which the benchmark rate had been replaced with an alternative benchmark rate as at 31 December 2020, there is no impact on opening equity balances as a result of retrospective application.

The following amended standard became effective from 1 April 2021, but did not have any material impact on the Group:

The Group has adopted COVID-19-Related Rent Concessions beyond 30 June 2021 - Amendment to IFRS 16 issued in March 2021. Prior to this amendment IFRS 16 introduced an optional practical expedient with limited applicability period for leases in which the Group is a lessee - i.e. for leases to which the Group applies the practical expedient, the Group is not required to assess whether eligible rent concessions that are a direct consequence of the COVID-19 coronavirus pandemic are lease modifications. The amendment in 2021 extended the availability of the practical expedient by one year. The Group has applied the amendment retrospectively. The amendment has no impact on retained earnings at 1 January 2021

New standards and interpretations not yet adopted

A number of new standards are effective for annual periods beginning after 1 January 2021 and earlier application is permitted; however, the Group has not early adopted the new or amended standards in preparing these consolidated financial statements.

Onerous contracts - Cost of Fulfilling a Contract (Amendments to IAS 37)

The amendments specify which costs an entity includes in determining the cost of fulfilling a contract for the purpose of assessing whether the contract is onerous. The amendments apply for annual reporting periods beginning on or after 1 January 2022 to contracts existing at the date when the amendments are first applied. At the date of initial application, the cumulative effect of applying the amendments is recognised as an opening balance adjustment to retained earnings or other components of equity, as appropriate. The comparatives are not restated. The Group has determined that there will be no uncompleted contracts before the amendments become effective.

Deferred Income Tax related to Assets and Liabilities arising from a Single Transaction (Amendments to IAS 12)

The amendments narrow the scope of the initial recognition exemption to exclude transactions that give rise to equal and offsetting temporary differences - e.g. leases and decommissioning liabilities. The amendments apply for annual reporting periods beginning on or after 1 January 2023. For leases and decommissioning liabilities, the associated deferred income tax asset and liabilities will need to be recognised from the beginning of the earliest comparative period presented, with any cumulative effect recognised as an adjustment to retained earnings or other components of equity at that date. For all other transactions, the amendments apply to transactions that occur after the beginning of the earliest period presented.

The Group accounts for deferred income tax on leases applying the 'integrally linked' approach, resulting in a similar outcome to the amendments, except that the deferred income tax impacts are presented net in the consolidated statement of financial position. Under the amendments, the Group will recognise a separate deferred income tax asset and a deferred income tax liability. As at 31 December 2021, the taxable temporary difference in relation to the right-of-use asset is RR 7,346,538 (Note 12) and the deductible temporary difference in relation to the lease liability is RR 6,665,845 (Note 12), resulting in a net deferred income tax liability of RR 50,718 (Note 26). Under the amendments, the Group will present a separate deferred income tax liability of RR 394,803 and a deferred income tax asset of RR 344,085. There will be no impact on retained earnings on adoption of the amendments.

2. Summary of significant accounting policies (continued)

2.32 Adoption of new or revised standards and interpretations (continued)

Other standards

The following new and amended standards are not expected to have a significant impact on the Group's consolidated financial statements.

- Annual Improvements to IFRS Standards 2018-2020.

- Property, Plant and Equipment: Proceeds before Intended Use (Amendments to IAS 16).

- Reference to Conceptual Framework (Amendments to IFRS 3).

- Classification of Liabilities as Current or Non-current (Amendments to IAS 1).

- IFRS 17 Insurance Contracts and amendments to IFRS 17 Insurance Contracts.

- Disclosure of Accounting Policies (Amendments to IAS 1 and IFRS Practice Statement 2).

- Definition of Accounting Estimates (Amendments to IAS 8).

The Group's Board of Directors assesses the impact of new standards and interpretations at the point when these are endorsed by the European Union. The new standards and interpretations are not expected to affect significantly the Group's consolidated financial statements.

3. Cash and cash equivalents


	31 December 2021	31 December 2020

Bank balances receivable on demand	456,816	2,597,065
Cash in transit	-	234,798
Bank deposits with original maturity of less than three months	46,004,535	9,034,370
Cash in hand	828	565
Total cash and cash equivalents	46,462,179	11,866,798

The Group had the following currency positions:


	31 December 2021	31 December 2020
Russian Roubles	46,318,693	11,290,200
Euro	91,844	24,413
US Dollars	51,496	552,065
Other	146	120
Total	46,462,179	11,866,798

The weighted average interest rate on cash at bank balances in Russian Roubles presented within cash and cash equivalents was 9.38% at 31 December 2021 (31 December 2020: 5.15%).

4. Short-term investments

	31 December 2021	31 December 2020

Bank deposits with original maturity over three months	18,519,392	-
Loans issued to third parties (Note 15)	2,119,893	19,137,343
Interest receivable on long-term bonds held to collect (Note 10)	221,734	218,057
Bonds held to collect	140,741	197,523
Interest receivable on bonds held for trading (Note 10)	-	7,908
Other short-term investments	-	22,692
Total	21,001,760	19,583,523

As at 31 December 2021 the bank deposits within short-term investments are denominated in Russian Roubles.

As at 31 December 2021 the interest rates on bank deposit denominated in Russian Roubles within

short-term investments vary between 6.5% and 7.75%. As at 31 December 2021 the weighted average interest rate on the bank deposits equals 6.92%.

As at 31 December 2021, the Group has bonds held to collect. The table below shows the rating and balances of bonds held to collect at 31 December 2021:


		31 December 2021		31 December 2020
	Rating agency	Rating	Balance	Rating	Balance

PJSC VTB Bank	S&P			bbb	25,308
PJSC Magnit	S&P			bb	136,662
PJSC MegaFon	Fitch Ratings			bb+	35,553
PJSC Vimpelcom	Fitch Ratings	bbb-	140,741	-	-
Total bonds to collect			140,741		197,523

5. Trade and other receivables


	31 December 2021	31 December 2020

Trade receivables	12,294,677	8,508,956
Other	548,016	469,167
Less: credit loss allowance (Note 30)	(842,375)	(148,322)
Total financial assets within trade and other receivables	12,000,318	8,829,801

Deferred charges	558,083	682,485
Total trade and other receivables	12,558,401	9,512,286

The above financial assets within trade and other receivables are denominated in the following currencies:


	31 December 2021	31 December 2020

Russian Roubles	8,996,307	7,273,692
US dollars	2,717,063	1,501,230
Euro	286,948	54,879
Total	12,000,318	8,829,801

5. Trade and other receivables (continued)

The credit loss allowance for trade and other receivables is determined according to the provision matrix presented in the table below. The provision matrix is based the number of days that an asset is past due.


		31 December 2021			31 December 2020
	Loss rate	Gross carrying amount	Lifetime expected credit loss	Gross carrying amount		Lifetime expected credit loss
Trade receivables - current	-	10,009,400		6,656,734		-
- less than 90 days overdue	2%	1,054,217	24,000	685,795		22,742
- 91 to 180 days overdue	100%	31,516	31,516	1,553		1,553
- 181 to 360 days overdue	100%	12,834	12,834	27,592		27,592
- over 360 days overdue	100%	678,821	678,821	24,958		24,958
Total trade receivables (gross carrying amount)		11,786,788	747,171	7,396,632		76,845

Credit loss allowance		747,171		76,845
Total trade receivables from contracts with customers (carrying amount)		11,039,617		7,319,787
Other receivables - current	-	452,811	-	387,983		-
- less than 90 days overdue	100%	59,245	59,244	35,612		25,905
- 91 to 180 days overdue	100%	919	919	5,729		5,729
- 181 to 360 days overdue	100%	4,263	4,263	5,039		5,039
- over 360 days overdue	100%	30,778	30,778	34,804		34,804
Total other receivables		548,016	95,204	469,167		71,477

Credit loss allowance		95,204		71,477
Total other receivables (carrying amount)		452,812		397,690

The Group did not recognise any expected credit loss allowance for trade receivables in the amount

of RR 507,889 because of excess of collateral value over the gross carrying value of these receivables as at 31 December 2021 (Note 15) (31 December 2020: RR 1,112,324).

The following table explains the changes in the credit loss allowance for trade and other receivables under the simplified expected credit loss model between the beginning and the end of the annual period:


	Trade receivables	Other receivables

As at 1 January 2021	76,845	71,477
Accrued	670,589	31,848
Utilised	(263)	(8,121)
As at 31 December 2021 (Note 30)	747,171	95,204
	Trade receivables	Other receivables

As at 1 January 2020	239,248	112,014
(Reversed)	(13,285)	(12,023)
Utilised	(149,118)	(28,514)
As at 31 December 2020 (Note 30)	76,845	71,477

The majority of the Group's trade debtors are proven counterparties with whom the Group has long-lasting sustainable relationships.

6. Prepayments

Prepayments classified as current assets represent the following advance payments:


	31 December 2021	31 December 2020

Prepayments for other materials	1,338,778	554,650
Prepayments for transportation services	1,038,156	677,737
Prepayments to customs	794,204	6,245
Prepayments for fuel and energy	775,258	361,373
Prepayments for raw material	757,701	574,698
Prepayments under insurance contracts	339,334	299,138
Prepayments for advertising expenses	146,974	130,272
Prepayments for rent	89,471	127,639
Prepayments for animals	44,915	70,634
Other prepayments	276,884	207,803
Less: provision for impairment	(187,643)	(68,965)
Total	5,414,032	2,941,224

Reconciliation of movements in the prepayments' impairment provision:


	2021	2020
As at 1 January	68,965	34,936
Accrued	121,714	38,900
Utilised	(3,036)	(4,871)
As at 31 December	187,643	68,965

As at 31 December 2021 prepayments classified as non-current assets and included in the "Advances paid for property, plant and equipment" line in the consolidated statement of financial position in the amount of RR 7,355,467 (31 December 2020: RR 6,905,003) and represent advance payments for construction works and purchases of production equipment.

7. Other taxes receivable


	31 December 2021	31 December 2020

Value added tax receivable	8,290,440	5,463,711
Other taxes receivable	30,753	42,964
Total	8,321,193	5,506,675

8. Inventories


	31 December 2021	31 December 2020

Finished goods	39,281,443	30,298,732
Raw materials	26,874,508	30,337,027
Work in progress	4,764,294	3,041,868
Less: provision for write-down to net realisable value	(1,163,882)	(411,238)
Total	69,756,363	63,266,389

As at 31 December 2021 the value of finished goods increased mainly as a result of higher cost of Oil and Fats products and higher fair value of harvested crops. Effect on inventory was partially offset by lower raw materials due to decrease of sunflower seeds stocks.

9. Biological assets

The fair value of biological assets belongs to level 3 measurements in the fair value hierarchy. Pricing model is used as a valuation technique for biological assets fair value measurement. There were no changes in the valuation technique during the years ended 31 December 2021 and 2020. The reconciliation of changes in biological assets between the beginning and the end of the year can be presented as follows:

Short-term biological assets

	Consumable livestock, pigs	Unharvested crops	Total

As at 1 January 2020	3,809,318	1,016,531	4,825,849

Increase due to purchases and gain arising from cost inputs	24,243,682	17,939,612	42,183,294
Gain on initial recognition of agricultural produce	-	14,279,563	14,279,563
Lost harvest written-off (Note 23)	-	(188,536)	(188,536)
Decrease due to harvest and sales of the assets	(23,971,389)	(32,185,021)	(56,156,410)
Gain arising from changes in fair value less estimated point-of-sale costs	791,219	-	791,219
As at 31 December 2020	4,872,830	862,149	5,734,979

Increase due to purchases and gain arising from cost inputs	31,347,531	19,423,838	50,771,369
Gain on initial recognition of agricultural produce	-	21,756,917	21,756,917
Lost harvest written-off (Note 23)	-	(272,407)	(272,407)
Decrease due to harvest and sales of the assets	(30,070,060)	(40,138,183)	(70,208,243)
Loss arising from changes in fair value less estimated point-of-sale costs	(29,945)	-	(29,945)
As at 31 December 2021	6,120,356	1,632,314	7,752,670

Long-term biological assets


	Bearer livestock
	Pigs	Cows	Total

As at 1 January 2020	2,154,000	125,335	2,279,335
Increases due to purchases and breeding costs of growing livestock	1,635,760	30,496	1,666,256
Decreases due to sales	(535,120)	(40,313)	(575,433)
Loss arising from changes in fair value less estimated point-of-sale costs	(839,406)	(2,624)	(842,030)
As at 31 December 2020	2,415,234	112,894	2,528,128
Increases due to purchases and breeding costs of growing livestock	572,677	40,097	612,774
Decreases due to sales	(359,228)	(145,264)	(504,492)
Gain/(Loss) arising from changes in fair value less estimated point-of-sale costs	116,180	(7,727)	108,453
As at 31 December 2021	2,744,863	-	2,744,863

In 2021 the aggregate gain on initial recognition of agricultural produce and from the change in fair value less estimated point-of-sale costs of biological assets amounted to RR 21,835,425 (2020: RR 14,228,752).

Included in the above amounts there are gains related to realised biological assets and agricultural produce amounting to RR 18,426,116 (2020: RR 8,338,305).

9. Biological assets (continued)

Livestock population were as follows:


	31 December 2021	31 December 2020
Cows (heads)	-	2,032
Pigs within bearer livestock (heads)	135,545	130,229
Pigs within consumable livestock (tonnes)	64,068	59,016

Cows were bred for the purpose of production of milk, in 2021 they were sold to external party. In 2021 the milk produced amounted to 3,569 tonnes (2020: 7,080 tonnes).

In 2021 total area of arable land amounted to 604 thousand ha (2020: 559 thousand ha).

The main crops of the Group's agricultural production and output were as follows (in thousands

of tonnes):

	2021	2020

---	---	---
Sugar beet	3,637	2,889
Wheat	713	1,007
Barley	2	78
Sunflower	72	67
Corn	163	110
Soya bean	341	284

Key inputs in the fair value measurement of the livestock and the agricultural crops harvested together with sensitivity to reasonably possible changes in those inputs are disclosed in Note 2.2.

As at 31 December 2021 biological assets with a carrying value of RR 417,669 (2020: RR 1,397,922) were pledged as collateral for the Group's borrowings (Note 15).

The Group is exposed to financial risks arising from changes in meat and crops prices. The Group does not anticipate that crops and meat prices will decline significantly in the foreseeable future except some seasonal fluctuations and, therefore, has not entered into derivative or other contracts to manage the risk of a decline in respective prices. The Group reviews its outlook for meat and crops prices regularly in considering the need for active financial risk management.

10. Long-term investments


	31 December 2021	31 December 2020

Bonds held to collect (Note 15)	19,900,000	19,900,000
Bank deposits with maturity over twelve months	14,071,101	14,070,635
Investments in third parties	8,556,556	8,556,556
Bonds held for trading (Note 15)	-	165,129
Total	42,527,657	42,692,320

The above long-term investments are denominated in Russian Roubles. Interest receivable on bonds to collect is disclosed in Note 4.

As at 31 December 2021 bank deposits in the amount of RR 13,900,000 (31 December 2020:

RR 13,900,000) were pledged as collateral for the Group's borrowings.

Bank deposits include a restricted deposit in Vnesheconombank in the amount of RR 13,900,000 which could not be withdrawn till 27 November 2028 (Note 15).

Bonds held to collect include restricted bonds in Rosselkhozbank in the amount of RR 19,900,000 which could not be withdrawn till 22 November 2038 (Note 15).

10. Long-term investments (continued)

On 20 August 2019 the Group acquired 22.5% of ownership interest in LLC GK Agro-Belogorie, one of the largest pork producers in Russia and a large landholder in Belgorod region. Total cash consideration transferred under the deal amounted to RR 8,500,000.

Key business areas of investee include industrial pig farming and meat processing, milk livestock, crop and feed production.

Investment in LLC GK Agro-Belogorie is classified as investment at fair value through other comprehensive income. The management considers that the Group does not have significant influence over LLC GK Agro-Belogorie due the following:

· The Group has no power to appoint the members of the board of directors or equivalent governing body of LLC GK Agro-Belogorie;

· Group management does not participate in the policy-making processes, including decisions about dividends or other distributions;

· There were no material transactions or interchange of managerial personnel between the Group and LLC GK Agro-Belogorie since the share acquisition date;

· No essential technical information was interchanged between the Group and LLC GK Agro-Belogorie.

The fair value of the investment determined applying the level 3 valuation model amounted to RR 8,500,000 at acquisition date.

Subsequent to the initial recognition this investment is measured at fair value through other comprehensive income. As at 31 December 2021 the fair value of the acquired investment amounted to RR 8,556,556 (31 December 2020: RR 8,556,556). The fair value of the investment has not changed significantly since 2020.

The fair value of the investment has been determined based on discounted cash flow calculation using the actual financial data and budgets of LLC GK Agro-Belogorie covering a five-year period and the expected market prices for the key products for the same period according to leading industry publications. Cash flows beyond the five-year period were projected with a long-term growth rate of 1.8% per annum (2020: 1.8% per annum).

The assumptions used for calculation and sensitivity of fair value measurement are presented in Note 30.

Bonds held to collect were denominated in Russian Roubles and mature in 2038. Nominal interest rate on bonds equals 10.5%. Bonds held for trading were acquired with the intention of generating a profit from short-term price fluctuations and for the purpose of these consolidated financial statements were classified as trading investments with measurement at fair value through profit or loss.

The table below shows the rating and balances of bonds held for trading and bonds held to collect:


		31 December 2021			31 December 2020
	Rating agency	Rating	Balance		Rating	Balance

Rosselkhozbank	Fitch Ratings	bbb-	19,900,000		bbb-	19,900,000
VimpelCom Ltd	Fitch Ratings		-		bbb-	142,205
LLC Lenta	Fitch Ratings		-		bb+	22,924
Total bonds (Note 10)				19,900,000		20,065,129

11. Property, plant and equipment

Movements in the carrying amount of property, plant and equipment were as follows:

	Land	Machinery, vehicles and equipment	Buildings and constructions	Assets under construction	Other	Total
Cost (Note 2.5)
As at 1 January 2020	8,340,021	57,947,352	42,134,202	18,776,155	238,571	127,436,301
Additions	412,553	2,180,363	247,729	14,262,182	29,416	17,132,243
Transfers	-	3,596,649	12,554,965	(16,163,200)	11,586	-
Disposals	(21,624)	(664,621)	(175,781)	(167,736)	(17,508)	(1,047,270)
As at 31 December 2020	8,730,950	63,059,743	54,761,115	16,707,401	262,065	143,521,274

Accumulated depreciation (Note 2.6)
As at 1 January 2020	-	(33,894,623)	(12,727,333)	-	(184,862)	(46,806,818)
Charge for the year	-	(6,667,902)	(3,138,494)	-	(37,807)	(9,844,203)
Disposals	-	590,912	41,526	-	16,397	648,835
As at 31 December 2020	-	(39,971,613)	(15,824,301)	-	(206,272)	(56,002,186)
Net book value as at 31 December 2020	8,730,950	23,088,130	38,936,814	16,707,401	55,793	87,519,088

	Land	Machinery, vehicles and equipment	Buildings and constructions	Assets under construction	Other	Total
Cost (Note 2.5)
As at 1 January 2021	8,730,950	63,059,743	54,761,115	16,707,401	262,065	143,521,274
Additions	1,021,851	19,772,434	9,484,566	15,768,265	68,545	46,115,661
Transfers	-	2,692,253	1,288,521	(4,003,480)	22,706	-
Disposals	(254,764)	(1,566,586)	(161,710)	(656,053)	19,625	(2,619,488)
As at 31 December 2021	9,498,037	83,957,844	65,372,492	27,816,133	372,941	187,017,447

Accumulated depreciation (Note 2.6)
As at 1 January 2021	-	(39,971,613)	(15,824,301)	-	(206,272)	(56,002,186)
Charge for the year	-	(9,052,685)	(4,129,984)	-	(36,591)	(13,219,260)
Disposals	-	1,281,129	62,657	-	19,625	1,363,411
As at 31 December 2021	-	(47,743,169)	(19,891,628)	-	(223,238)	(67,858,035)
Net book value as at 31 December 2021	9,498,037	36,214,675	45,480,864	27,816,133	149,703	119,159,412

As at 31 December 2021 property, plant and equipment with a net book value of RR 40,384,880

(31 December 2020 RR 25,920,704) was pledged as collateral for the Group's borrowings (Note 15).

As at 31 December 2021 and 2020 the assets under construction related mainly to the pig farm construction in the Tambov region and Primorsky Krai. During the reporting period, the Group capitalised borrowing costs within assets under construction in the amount of RR 1,922,627 (2020: RR 1,537,052). The average capitalisation rate in 2021 was 7.34% (2020: 7.27%).

At 31 December 2021 and 2020, inventories intended for construction related mainly to the inventories which will be used for the pig farm construction in the Primorsky Krai.

11. Property, plant and equipment (continued)

Movements in the carrying amount of inventories intended for construction were as follows:


As at 1 January 2020	3,157,369
Additions	3,504,176
Disposals	(3,308,215)
As at 31 December 2020	3,353,330

As at 1 January 2021	3,353,330
Additions	468,839
Disposals	(2,217,599)
As at 31 December 2021	1,604,570

12. Right-of-use assets and lease liabilities

The Group leases various lands, buildings, machinery, equipment and vehicles. Rental contracts are typically made for fixed periods of 12 months to 49 years but may have extension options as described below.

Leases are recognised as a right-of-use asset and a corresponding liability from the date when the leased asset becomes available for use by the Group.

As for the land lease, contracts include monetary agreements in which payments do not depend on an index or a rate and non-monetary agreements based on a fixed volume of harvested crops. Based on management's assessment and previous experience, the lease term was set as 10 years as a minimum for contracts with prolongation option. This term is justified by payback period of particular investment projects, which depend on the time to analyse composition of the land and the roll-out and purchase price of necessary fertilizers and equipment.

Extension and termination options are included in a number of property and equipment leases across the Group. These are used to maximise operational flexibility in terms of managing the assets used in the Group's operations. The majority of extension and termination options held are exercisable only by the Group and not by the respective lessor. For not tacitly renewable leases with contractual terms less than 12 months the lease term (and lease enforceability) is not considered to go beyond initial contract term. The Group applies the exemption for short-term leases for such agreements.

The Group recognised right-of-use asset as follows:


	Land	Buildings	Equipment	Other	Total
Carrying amount at 1 January 2020	4,801,618	1,335,643	88,445	5,001	6,230,707
Additions and modifications	1,620,103	468,444	8,217	-	2,096,764
Disposals	(663,379)	(8,507)	-	-	(671,886)
Depreciation charge (Note 20,21,22)	(463,976)	(223,095)	(32,855)	(1,092)	(721,018)
Carrying amount at 31 December 2020	5,294,366	1,572,485	63,807	3,909	6,934,567
	Land	Buildings	Equipment	Other	Total
Carrying amount at 1 January 2021	5,294,366	1,572,485	63,807	3,909	6,934,567
Additions and modifications	1,518,128	158,803	7,898	-	1,684,829
Disposals	(478,338)	-	-	-	(478,338)
Depreciation charge (Note 20,21,22)	(564,934)	(200,960)	(27,535)	(1,091)	(794,520)
Carrying amount at 31 December 2021	5,769,222	1,530,328	44,170	2,818	7,346,538

Interest expense included in finance costs for 2021 was RR 591,558 (2020: RR 580,276) (Note 24).

As at 31 December 2021, future cash outflows of RR 2,192,694 (undiscounted) (31 December 2020: RR 1,830,868) to which the Group is potentially exposed to during the lease term have not been included in the lease liability because they include variable lease payments that are linked to cadastral value.

12. Right-of-use assets and lease liabilities (continued)

Variable lease payments that depend on cadastral value are recognised in profit or loss in the period in which the condition that triggers those payments occurs.

Expenses relating to short-term leases (included in cost of sales and general and administrative expenses):


	2021	2020

Expenses related to contracts in which variable payments do not depend on an index or a rate	227,872	145,923
Expenses relating to short-term leases	395,774	528,716

Total outflow for leases in 2021 was RR 1,098,167 (2020: RR 1,057,899), including RR 302,739 (2020: RR 439,157) settled in agricultural products.

The reconciliation of lease liabilities and the movements is presented in Note 15.

13. Intangible assets


	Trademarks	Software licenses	Internally developed software	Other	Total
Cost (Note 2.9)
As at 1 January 2020	156,971	902,077	49,712	365,644	1,474,404
Additions	4,903	336,653	122	77,130	418,808
Disposals	(1,333)	(238,403)	(14,362)	(265)	(254,363)
As at 31 December 2020	160,541	1,000,327	35,472	442,509	1,638,849

Accumulated amortisation (Note 2.9)
As at 1 January 2020	(74,987)	(554,672)	(39,997)	(196,113)	(865,769)
Charge for the year	(6,354)	(325,279)	(3,782)	(56,756)	(392,171)
Disposals	1,333	223,310	14,098	143	238,884
As at 31 December 2020	(80,008)	(656,641)	(29,681)	(252,726)	(1,019,056)

Net book value as at 31 December 2020	80,533	343,686	5,791	189,783	619,793


	Trademarks	Software licenses	Internally developed software	Other	Total
Cost (Note 2.9)
As at 1 January 2021	160,541	1,000,327	35,472	442,509	1,638,849
Additions	37,305	771,018	12,771	221,524	1,042,618
Acquisitions through business combinations	-	32,132	-	-	32,132
Disposals	(814)	(394,399)	(1,658)	(97,248)	(494,119)
As at 31 December 2021	197,032	1,409,078	46,585	566,785	2,219,480

Accumulated amortisation (Note 2.9)
As at 1 January 2021	(80,008)	(656,641)	(29,681)	(252,726)	(1,019,056)
Charge for the year	(58,982)	(375,231)	(3,443)	(40,789)	(478,445)
Disposals	761	394,303	59	26,955	422,078
As at 31 December 2021	(138,229)	(637,569)	(33,065)	(266,560)	(1,075,423)

Net book value as at 31 December 2021	58,803	771,509	13,520	300,225	1,144,057

14. Share capital, share premium and transactions with non-controlling interests

Share capital and share premium

At 31 December 2021 the issued and paid share capital consisted of 27,333,333 ordinary shares

(31 December 20120: 27,333,333 ordinary shares) with par value of EUR 0.01 each.

At 31 December 2021 and 2020, the authorised share capital consisted of 60,000,000 ordinary shares with par value of EUR 0.01 each.

Treasury shares

At 31 December 2021 the Group held 2,135,313 of its own GDRs (31 December 2020: 2,135,313 own GDRs) that is equivalent of approximately 427,063 shares (31 December 2020: 427,063 shares). The GDRs are held as treasury shares. In 2021 and 2020 there were no acquisitions of treasury shares.

In 2020 31,000 GDRs were transferred to the employees under the share option incentive arrangements. No GDRs were transferred to the employees under the share option incentive schemes during 2021.

Dividends

In 2021 the Company distributed RR 10,770,584 of dividends for the second half of 2020 and RR 8,755,947 thousand of interim dividends for the first half of 2021. The dividends for the second half of 2020 amounted to RR 400.30 per share and interim dividends for 2021 amounted to RR 325.42 per share.

In 2020 the Company distributed RR 3,216,350 of dividends for the second half of 2019 and RR 1,922,033 of interim dividends for the first half of 2020. The dividends for the second half of 2019 amounted to RR 119.54 per share and interim dividends for 2020 amounted to RR 71.43 per share. All dividends declared were paid in 2020.

Purchases of non-controlling interest

2021

On 22 October 2021 the Group acquired 25% additional shares in LLC Primorskaya Soya, thereby increasing its share in the share capital to 100% (2020: 75%). The total excess of consideration paid over the Group's share of identifiable net assets acquired in the amount of RR 55, 541 was recorded as a capital transaction in the consolidated statement of changes in equity.

On 28 October 2021 the Group's subsidiary LLC Primorskaya Niva was liquidated. The Group held 75% share in the share capital of LLC Primorskaya Niva at the date of liquidation, corresponding non-controlling interest disposal in the amount of RR 0 was recorded as a capital transaction in the consolidated statement of changes in equity.

2020

On 3 March 2020 the Group's subsidiary OJSC Pugachevskiy Elevator was liquidated. The Group held 84.95% share in the share capital of OJSC Pugachevskiy Elevator at the date of liquidation, corresponding non-controlling interest disposal in the amount of RR 2,792 was recorded as a capital transaction in the consolidated statement of changes in equity.

15. Borrowings

Short-term borrowings


	31 December 2021	31 December 2020

Bank loans	90,806,471	32,762,452
Loans received from third parties	16,600	16,600
Interest accrued on borrowings from third parties	246	615
Current portion of long-term borrowings	17,925,523	18,973,808
Total	108,748,840	51,753,475

All short-term borrowings are at fixed interest rate. The above borrowings are denominated in the following currencies:


	Interest rate	31 December 2021	Interest rate	31 December 2020

Russian Roubles	1.0%-11.14%	108,748,840	1.0%-11.14%	51,753,475
Total		108,748,840		51,753,475

Long-term borrowings


	31 December 2021	31 December 2020

Bank loans	81,900,548	82,149,528
Less current portion of long-term borrowings from:
Bank loans	(17,925,523)	(18,973,808)
Total	63,975,025	63,175,720

The above borrowings are denominated in the following currencies:


	Interest rate	31 December 2021	Interest rate	31 December 2020
Russian Roubles	1.0%-12.5%	63,975,025	1.0%-12.5%	63,175,720
Total		63,975,025		63,175,720

In November 2018 the Group entered into a transaction with JSС Rosselkhozbank (hereinafter - "RSHB") for the acquisition of debt of Group of companies Solnechnye producty and its subsidiaries and related companies. The gross value of total consideration for this acquisition amounted to RR 34,810,446 and the payment will be made by the Group in cash in accordance with the payment schedule deferred over 20 years.

The deferred liability due to RSHB is presented within bank loans. The fair value of this liability at inception date was RR 19,897,813 determined using the effective interest rate of 10.7% (applying level 2 valuation model). The liability is subsequently measured at amortized cost with an effective interest rate of 10.7%. The liability is collateralised by the 20-year bonds of RSHB in the amount of RR 19,900,000 at the interest rate of 10.5% per annum purchased by the Group.

The fair value of the loans acquired in this transaction determined applying the level 3 valuation model amounted to RR 23,410,231.

The fair value of the acquired loans has been determined based on the fair value of the collateral. The collateral fair value is represented by the fair value of the underlying rights of claim determined with reference to the assets pledged and other assets of the borrower / guarantors, taking into account bankruptcy procedure period and discount rate, applicable to distressed assets. The fair value of the production companies as a part of the assets pledged was determined based on discounted cash flow calculations.

The difference of RR 3,412,418 between the fair value of the consideration and the fair value of loans acquired represented day-one gain was initially deferred for the period of 5 years being the average term of the acquired loans.

15. Borrowings (continued)

As at 31 December 2019 the bankruptcy procedure expected to be finalised by the end of 2020. In 2020 COVID-19 pandemic caused the overall slowdown of bankruptcy procedures leading to the shift of expected finalization to the end of 2021. As at 31 December 2020 the acquired loans amounted to RR 18,580,203 (including RR 4,875,725 of interest receivable on these loans) and recognised within Short-term investments (Note 4).

In 2020 part of loans issued was repaid and the Group started to participate in auctions to buy some of the assets of Solnechnye producty. An expected credit loss allowance for loans receivable in the amount of RR 4,804,688 was recognized because of the excess of gross carrying value of these loans as at 31 December 2020 over their collateral fair value mainly driven by the bankruptcy procedures terms' increase. The collateral fair value is represented by the fair value of the underlying rights of claim determined with reference to the assets pledged and other assets of the borrower / guarantors, taking into account bankruptcy procedure period and discount rate, applicable to distressed assets. The fair value of the production companies as part of the assets pledged was determined based on discounted cash flow calculations using the actual financial data and budgets of pledged Solnechnye producty production units covering a five-year period and the expected market prices for the key products for the same period according to the leading industry publications.

The assumptions used for the calculations to which the fair value is most sensitive were:

· WACC after-tax discount rate of 12.3%;

· Discount rate applicable to distressed assets of 20.3%.

If the revised estimated WACC after-tax discount rate applied to the discounted cash flows used in the valuation models of the loans acquired and discount rate applicable to distressed assets had been 1.0% higher than management's estimates, with all other assumptions held constant, the Group would need to increase the credit loss allowance by RR 1,990,099.

During the year ended 31 December 2021 the Group acquired on a public auction the key production assets of two oil extraction plants: OJSC Atkarskiy MEZ and LLC Volzhskiy Terminal and fat plant JSC Zirovoj kombinat, subsidiaries of Solnechnye Producty, for total consideration of RR 28,202,943 (Note 11). These assets were pledged as a collateral for loans issued to Solnechnye Producty. After these asset acquisitions major part of corresponding loans issued were repaid. We assessed whether the assets acquired by the Group from Solnechnye Producty meet the definition of a business under IFRS 3. The Group acquired no processes or outputs in the transaction and, therefore the Group accounted for it as an acquisition of assets rather than a business combination.

As at 31 December 2021 the expected credit loss allowance for loans receivable in the amount of RR 4,804,688 recognized as at 31 December 2020 was reversed in full amount.

As at 31 December 2021 the acquired loans amounted to RR 1,591,805 (including RR 417,713 of interest receivable on these loans) and are recognised within Short-term investments (Note 4). Redemption of remaining loans issued is expected to be finalized by 30 June 2022.

As at 31 December 2020 the day-one gain amounted to RR 552,748 and is recognised within Trade and other payables (Note 16). As at 31 December 2021 the day-one gain was fully realised.

In November 2015 the Group entered into a transaction with VEB for the acquisition of debt (loans and bonds) of PJSC Group Razguliay and its subsidiaries (hereinafter - "Razguliay Group"). The total consideration for this acquisition amounted to RR 33,914,546 and was paid by the Group in cash. As at 31 December 2021 the debts were fully repaid.

For the purpose of financing of this transaction, the Group raised a thirteen-year loan from VEB

in the amount of RR 33,914,546 at 1% per annum. The fair value of this loan at inception date was RR 13,900,000 determined using the effective interest rate of 13.23%. The loan is measured at amortized cost with an effective interest rate of 13.23%. The loan is secured by a thirteen-year deposit placed by the Group with VEB in the amount of RR 13,900,000 (Note 10) at the interest rate of 12.84% per annum.

15. Borrowings (continued)

Maturity of long-term borrowings


	31 December 2021	31 December 2020

Fixed interest rate borrowings:
2 years	9,963,539	16,867,579
3-5 years	26,737,172	21,662,876
More than 5 years	27,274,314	24,645,265
Total	63,975,025	63,175,720

For details of property, plant and equipment and biological assets pledged as collateral for the above borrowings see Note 9 and Note 11. For details of bank deposits pledged as collateral for the above borrowings refer to Notes 10.

Shares of several companies of the Group are pledged as collateral for the bank borrowings, as follows:


	Pledged shares, %
	31 December 2021	31 December 2020
LLC Rusagro-Primorie	100.0	100.0
LLC Rusagro-Tambov	51.0	51.0

Reconciliation of liabilities arising from financing activities

The table below sets out an analysis of liabilities from financing activities and the movements in the Group's liabilities from financing activities for each of the periods presented. The items of these liabilities are those that are reported as financing in the consolidated statement of cash flows:

	Borrowings	Lease liabilities	Total liabilities from financing activities

As at 1 January 2020	97,875,483	4,906,592	102,782,075
Cash flows
Proceeds from borrowings	77,932,773	-	77,932,773
Repayment of borrowings	(65,389,365)	(123,044)	(65,512,409)
Interest payments	(3,700,753)	(495,698)	(4,196,451)
Non-cash changes
Foreign exchange adjustments	1,366,375	24,502	1,390,877
Other non-cash movements	6,844,682	1,487,015	8,331,697
As at 31 December 2020	114,929,195	5,799,367	120,728,562

Cash flows
Proceeds from borrowings	107,856,022	-	107,859,742
Repayment of borrowings	(52,668,951)	(335,167)	(53,004,118)
Interest payments	(4,131,675)	(460,260)	(4,591,935)
Non-cash changes
Foreign exchange adjustments	(661)	(5,144)	(5,805)
Other non-cash movements	6,739,935	1,667,049	8,403,264
As at 31 December 2021	172,723,865	6,665,845	179,389,710

15. Borrowings (continued)

For the purpose of conformity with the methodology of the Group's Net Debt calculation, cash flows

from investing and financing activities in the Group management accounts are presented as follows:


	Year ended 31 December 2021
	According to IFRS	Reclassifications	Management accounts
Cash flows from investing activities
Purchases of property, plant and equipment	(42 029 048)	-	(42 029 048)
Purchases of inventories intended for construction	(476,322)	-	(476,322)
Change in cash on bank deposits	(18,000,000)	18,000,000	-
Proceeds from sales of bonds with maturity over three months	220,282	(220,282)	-
Purchases of associates	(102,000)	-	(102,000)
Purchases of other investments	(19,083)	-	(19,083)
Purchases of loans issued	(2,256,313)	2,256,313	-
Loans repaid	22,959,494	(22,959,494)	-
Interest received	8,786,038	(8,786,038)	-
Proceeds from sales of other assets	217,591	-	217,591
Other cash flows in investing activities	1,133,022	-	1,133,022
Net cash used in investing activities	(29 566 339)	(11,709,501)	(41 275 840)
Cash flows from financing activities
Proceeds from borrowings	107,856,022	-	107,856,022
Repayment of borrowings	(52,668,951)	-	(52,668,951)
Change in cash on bank deposits	-	(18,000,000)	(18,000,000)
Purchases of bonds with maturity over three months	-	220,282	220,282
Purchases of loans issued	-	(2,256,313)	(2,256,313)
Loans repaid*	-	22,959,494	22,959,494
Dividends paid to owners Ros Agro PLC	(19,417,565)	-	(19,417,565)
Interest and other finance cost paid	(4,591,935)	-	(4,591,935)
Interest received	-	8,786,038	8,786,038
Proceeds from government grants	2,879,218	-	2,879,218
Repayment of lease liabilities-principal	(335,167)	-	(335,167)
Other cash flows in financing activities	(44,369)	-	(44,369)
Net cash used in financing activities	33,677,253	11,709,501	45,386,754


	Year ended 31 December 2020
	According to IFRS	Reclassifications	Management accounts
Cash flows from investing activities
Purchases of property, plant and equipment	(12,405,295)	-	(12,405,295)
Purchases of inventories intended for construction	(1,660,923)	-	(1,660,923)
Purchases of bonds with maturity over three months	(197,523)	197,523	-
Purchases of associates	(92,712)	-	(92,712)
Purchases of loans issued	(13,829)	13,829	-
Loans repaid	1,012,854	(1,012,854)	-
Interest received	4,808,803	(4,808,803)	-
Other cash flows in investing activities	665,272	-	665,272
Net cash used in investing activities	(7,883,353)	(5,610,305)	(13,493,658)
Cash flows from financing activities
Proceeds from borrowings	77,932,773	-	77,932,773
Repayment of borrowings	(65,389,365)	-	(65,389,365)
Purchases of bonds with maturity over three months	-	(197,523)	(197,523)
Purchases of loans issued	-	(13,829)	(13,829)
Loans repaid*	-	1,012,854	1,012,854
Interest and other finance cost paid	(4,196,451)	-	(4,196,451)
Interest received*	-	4,808,803	4,808,803
Proceeds from government grants	2,192,483	-	2,192,483
Repayment of lease liabilities-principal	(123,044)	-	(123,044)
Other cash flows in financing activities	(5,134,426)	-	(5,134,426)
Net cash used in financing activities	5,281,970	5,610,305	10,892,275

15. Borrowings (continued)

Net Debt*

As part of liquidity risk management, the Group Treasury analyses its net debt position. The Group management determines the Net Debt of the Group as outstanding long-term borrowings and short-term borrowings less cash and cash equivalents, all bank deposits, bonds held for trading and banks' promissory notes. The Group management compares net debt figure with Adjusted EBITDA (Note 29).

As at 31 December 2021 and 2020 the net debt of the Group was as follows:


	31 December 2021	31 December 2020
Long-term borrowings	63,975,025	63,175,720
Short-term borrowings	108,748,840	51,753,475
Cash and cash equivalents (Note 3)	(46,462,179)	(11,866,798)
Bank deposits within long-term investments (Note 10)	(14 071 101)	(13,900,000)
Bank deposits within short-term investments (Note 4)	(18,519,392)	-
Long-term bonds held for collect (Note 10)	(19,900,000)	(19,900,000)
Long-term bonds held for trading (Note 10)	-	(165,129)
Short-term bonds held for collect (Note 4)	(362,475)	(197,523)
Net debt*	73,408,718	68,899,745
including long-term Net debt	30,003,924	29,210,591
including short-term Net debt	43,404,794	39,689,154
Adjusted EBITDA* (Note 29)	48,059,789	31,984,073
Net debt/ Adjusted EBITDA*	1.53	2.15

* not an IFRS measure.

16. Trade and other payables


	31 December 2021	31 December 2020
Trade accounts payable	9,940,834	10,075,172
Payables for property, plant and equipment	992,962	983,481
Other payables	289,123	33,388
Total financial liabilities within trade and other payables	11,222,919	11,092,041

Payables to employees	2,297,560	1,597,491
Advances received	1,920,156	2,773,858
Other payables (Note 15)	-	552,748
Total trade and other payables	15,440,635	16,016,138

Financial liabilities within trade and other payables of RR 283,332 (31 December 2020: RR 177,222) are denominated in US Dollars, financial liabilities within trade and other payables of RR 452,470 (31 December 2020: RR 646,121) are denominated in Euros. All other financial liabilities within trade and other payables are denominated in Russian Roubles.

17. Other taxes payable


	31 December 2021	31 December 2020

Value added tax	6,813,191	3,711,148
Social contributions	323,299	243,035
Property tax	200,701	92,776
Personal income tax	74,732	14,371
Transport tax	5,936	5,345
Other	36,699	29,524
Total	7,454,558	4,096,199

18. Government grants

During 2020-2021 the Group received government grants from the Tambov and Belgorod regional governments and the Federal government in form of partial compensation of the investments into acquisition of equipment for agricultural business and sugar processing and the investments into reconstruction and modernisation of the pig-breeding farms and the slaughter house. The receipts of these grants in 2021 amounted to RR 94,896 (2020: RR 291,966). These grants are deferred and amortised on a straight-line basis over the expected lives of the related assets.

In 2020-2021 the Group obtained government grants for reimbursement of interest expenses on bank loans received for construction of the pig-breeding farms in the Far East and Tambov. The government grants related to interest expenses capitalised into the carrying value of assets, were similarly deferred and amortised on a straight-line basis over the expected lives of the related assets. The deferred government grants, related to capitalised interest expense, amounted to RR 1,337,153 (2020: RR 995,874).

The movements in deferred government grants in the consolidated statement of financial position were as follows:


	2021	2020
As at 1 January	8,536,899	8,306,779
Government grants received	1,432,023	1,287,840
Amortization of deferred income to match related depreciation (Note 23)	(643,392)	(642,501)
Write-off due to early repayment of the loan	-	(415,219)
As at 31 December	9,325,530	8,536,899

Other bank loan interests, which had been refunded by the state, were credited to the consolidated statement of profit or loss and other comprehensive income and netted with the interest expense (Note 24).

Other government grants received are included in Note 23.

19. Sales

Disaggregation of revenue for 2021 by category:


	Sugar	Meat	Agriculture	Oil and Fat	Other	Elimination	Total
Type of goods and services
Sales of goods	35,264,205	39,546,509	41,357,971	122,792,170	184,673	(20,180,780)	218,964,748
Transportation services	478,926	81,555	82,989	2,320,078	-	-	2,963,548
Other services	617,435	-	440,050	124,353	534,779	(712,474)	1,004,143
Total revenue from contracts with customers	36,360,566	39,628,064	41,881,010	125,236,601	719,452	(20,893,254)	222,932,439

Geographical market
Russian Federation	32,669,135	33,564,924	40,733,440	70,665,620	576,872	(20,893,254)	157,316,737
Foreign countries	3,691,431	6,063,140	1,147,570	54,570,981	142,580	-	65,615,702
Total revenue from contracts with customers	36,360,566	39,628,064	41,881,010	125,236,601	719,452	(20,893,254)	222,932,439

Timing of revenue recognition
Goods transferred at a point of time	35,264,205	39,546,509	41,357,971	122,792,170	184,673	(20,180,780)	218,964,748
Services transferred over time	1,096,361	81,555	523,039	2,444,431	534,779	(712,474)	3,967,691
Total revenue from contracts with customers	36,360,566	39,628,064	41,881,010	125,236,601	719,452	(20,893,254)	222,932,439

Disaggregation of revenue for 2020 by category under revenue recognition guidance:


	Sugar	Meat	Agriculture	Oil and Fat	Other	Elimination	Total
Type of goods and services
Sales of goods	27,272,132	32,391,964	33,973,009	77,230,964	326,357	(15,811,891)	155,382,535
Transportation services	761,798	42,250	82,138	2,312,951	-	-	3,199,137
Other services	78,589	-	292,359	182,336	304,751	(468,672)	389,363
Total revenue from contracts with customers	28,112,519	32,434,214	34,347,506	79,726,251	631,108	(16,280,563)	158,971,035

Geographical market
Russian Federation	22,552,664	28,303,697	27,669,655	45,398,977	32,874	(16,280,563)	107,677,304
Foreign countries	5,559,855	4,130,517	6,677,851	34,327,274	598,234	-	51,293,731
Total revenue from contracts with customers	28,112,519	32,434,214	34,347,506	79,726,251	631,108	(16,280,563)	158,971,035

Timing of revenue recognition
Goods transferred at a point of time	27,272,132	32,391,964	33,973,009	77,230,964	326,357	(15,811,891)	155,382,535
Services transferred over time	840,387	42,250	374,497	2,495,287	304,751	(468,672)	3,588,500
Total revenue from contracts with customers	28,112,519	32,434,214	34,347,506	79,726,251	631,108	(16,280,563)	158,971,035

The transportation expenses related to Revenue from transportation services in the amount of RR 2,963,548 were recognised within Cost of sales (2020: RR 3,199,137).

20. Cost of sales


	2021	2020
Raw materials and consumables used	142,726,706	103,510,553
Services	14,267,005	12,175,874
Depreciation	12,181,199	9,441,374
Payroll	10,859,254	8,963,448
Purchases of goods for resale	3,129,999	1,361,672
Other	4,881,272	1,614,609
Provision for net realisable value	1,043,295	621,090
Depreciation of right-of-use assets	616,248	534,025
Purchase of biological assets	129,779	1,241,577
Change in work in progress, finished goods and goods for resale, biological assets	(20,586,476)	(18,331,564)
Total	169,248,281	121,132,658

"Change in work in progress, finished goods and goods for resale, biological assets" line above includes changes in balances of goods produced and goods purchased for resale, changes in work in progress and changes in biological assets excluding the effect of revaluation adjustments. This line also includes change in depreciation as included in work in progress, finished goods and biological assets in the amount of RR (546,679) (2020: RR (163,346)).

Payroll costs include salaries of RR 8,437,218 (2020: RR 6,841,137) and statutory pension contributions of RR 1,847,658 (2020: RR 1,571,441).

The average number of employees employed by the Group during the year ended 31 December 2021 was 19,030 (19,344 for the year ended 31 December 2020).

21. Distribution and selling expenses


	2021	2020

Transportation and loading services	3,857,111	4,055,104
Advertising	1,960,769	1,742,131
Payroll	1,718,304	1,701,474
Other services	773,172	725,053
Customs duties	550,318	17,291
Depreciation and amortization	219,171	163,534
Rent	172,035	172,732
Materials	162,713	158,811
Fuel and energy	130,437	135,763
Depreciation of right-of-use assets	34,847	27,062
Provision for impairment of receivables	25,226	13,592
Other	863,744	638,725
Change in selling and distribution expenses attributable to goods not sold	7,290	209,569
Total	10,475,137	9,760,841

Payroll costs include salaries of RR 1,364,609 (2020: RR 1,346,603) and statutory pension contributions of RR 353,695 (2020: RR 354,871).

22. General and administrative expenses


	2021	2020
Payroll	4,897,196	4,155,047
Depreciation	1,297,335	631,466
Services of professional organisations	1,263,971	523,805
Materials	760,384	106,362
Taxes, excluding income tax	627,768	457,069
Fuel and energy	257,048	104,290
Security	193,286	211,219
Rent	174,270	289,418
Depreciation of right-of-use assets	143,425	159,931
Bank services	135,729	170,517
Repair and maintenance	114,228	68,517
Insurance	92,674	57,890
Travelling expenses	90,071	145,379
Communication	40,884	44,023
Statutory audit fees	3,590	3,537
Other	884,039	248,979
Total	10,975,898	7,377,449

Payroll costs above include salaries of RR 4,065,961 (2020: RR 3,443,030) and statutory pension contributions of RR 831,235 (2020: RR 712,017).

The total fees charged by the Company's statutory auditor for the statutory audit of the annual financial statements of the Company for the year ended 31 December 2021 amounted to RR 3,590 (2020:

RR 3,537). No fees charged by the Company's statutory auditor for the year ended 31 December 2021 for tax advisory services (2020: RR 607).

23. Other operating income, net

	2021	2020

Reimbursement of operating expenses (government grants)	2,135,565	930,630
Realised deferred day-one gain (Note 15)	552,748	993,558
Operating foreign exchange gain/(loss), net	170,355	(465,210)
Amortization of deferred income to match related depreciation (Note 18)	643,392	642,501
(Loss)/gain on disposal of property, plant and equipment	(4,424)	335,640
Charitable donations and social costs	(918,181)	(411,179)
Gain on other investments	754,538	560,568
Fines and penalties receivable	60,238	450,000
The result from early repayment of the loan	-	(131,363)
Provisions for receivables, other liabilities and charges	(1,082,407)	(179,796)
Gain on SolPro loans redemption	605,233	-
Loss on disposal of other assets	(256,144)	-
Loss on sale of goods and materials, except for main products	(160,907)	(24,314)
Lost harvest write-off (Note 9)	(272,407)	(188,536)
Loss on implementation of work, services	(27,209)	(118,230)
Payroll	11,941	(53,671)
Other shortages and losses	28,742	(146,916)
Other	93,104	99,335
Total	2,334,177	2,293,017

Gain on other investments in 2021 is comprised out of dividends received from LLC GK Agro-Belogorie in the amount of RR 754,538 (2020: RR 560,568).

23. Other operating income, net (continued)

The Group management excludes the following components of Other operating income/(expenses) from Adjusted EBITDA calculation as non-recurring items (Note 29):

Non-recurring other operating adjustment

	2021	2020

Realised deferred day-one gain (Note 15)	552,748	993,558
Amortization of deferred income to match related depreciation (Note 18)	643,392	642,501
Operating foreign exchange gain/(loss), net	170,355	(465,210)
(Loss)/ gain on disposal of property, plant and equipment	(4,424)	335,640
Charitable donations and social costs	(918,181)	(411,179)
Gain on other investments	754,538	560,568
Fines and penalties receivable	60,238	450,000
The result from early repayment of the loan	-	(131,363)
Gain on SolPro loans redemption	605,233	-
Loss on disposal of other assets	(256,144)	-
Provisions for receivables, other liabilities and charges	(1,082,407)	(179,796)
Other	(72,295)	18,910
Total	453,053	1,813,629

24. Interest expense and other finance income/ (costs), net

Interest expense comprised of the following:


	2021	2020

Interest expense	10,566,994	6,448,154
Reimbursement of interest expense (government grants)	(5,068,003)	(1,643,159)
Interest expense, net	5,498,991	4,804,995

Other finance income/ (costs), net comprised of the following items:


	2021	2020
Financial foreign exchange differences (loss)/ gain, net	(111,001)	(1,233,636)
Interest expense on leases (Note 12)	(591,558)	(580,276)
Other finance costs, net	(2,797)	(30,218)
Other finance costs, net	(705,356)	(1,844,130)

25. Goodwill


	2021	2020
Carrying amount at 1 January	2,364,942	2,364,942
Acquisitions	-	-
Carrying amount at 31 December	2,364,942	2,364,942

The carrying amount of goodwill is allocated to the following CGUs:


	31 December 2021	31 December 2020
Meat CGU	538,684	538,684
Oil Samara CGU	899,401	899,401
Agriculture Center CGU	199,276	199,276
Sugar CGU	502,083	502,083
Agriculture Primorie CGU	225,498	225,498
Total	2,364,942	2,364,942

25. Goodwill (continued)

Goodwill Impairment Test

The carrying amount of goodwill as at 31 December 2021 and 2020 was tested for impairment.

The recoverable amount of the Group's cash-generating units has been determined based on a value-in-use calculation using cash flow projections based on financial budgets approved by the Group management covering a five-year period and the expected market prices for the Group's key products for the same period according to leading industry publications. Cash flows beyond the five-year period are projected with a long-term growth rate of 4% per annum (31 December 2020: 3.5% per annum).

The assumptions used for value-in-use calculations to which the recoverable amount is most sensitive were:


	EBITDA margin*		Pre-tax discount rate
	2021	2020	2021	2020

Oil Samara CGU	10.7%-12.9%	8.8%-13.5%	20,58%	12.45%
Agriculture Center CGU	33.9%-44.5%	31.8%-36.7%	11.91%	9.87%
Sugar CGU	30.5%-32.7%	20.5%-22.2%	12.18%	12.08%
Agriculture Primorie CGU	26.2%-32.8%	31.1%-34.5%	11.90%	10.15%
Meat CGU	9.1%-20.1%	26.0%-30.0%	9.36%	10.15%

* EBITDA margin is calculated as the sum of operating cash flows before income tax and changes in working capital divided by the amount of cash flow received from trade customers.

2021 and 2020

As a result of the testing, no impairment losses were recognised for the goodwill allocated to each CGU.

26. Income tax


	2021	2020

Current income tax charge	3,397,411	1,755,669
Deferred income tax charge / (credit)	124,733	(1,728,898)
Income tax expense	3,522,144	26,771

The Group companies domiciled in Russia were subject to an income tax rate of 20% (2020: 20%) of taxable profits, except for profit on sales of agricultural produce taxable at 0% (2020: 0%).

Group entities operating in other tax jurisdictions were taxed at 0% and 12.5% (2020: 0% and 12.5%).

The current income tax charge represents a tax accrual based on statutory taxable profits. A reconciliation between the expected and the actual taxation charge is as follows:


	2021	2020

Profit before income tax:	44,955,996	24,323,498
- taxable at 0%	36,439,999	25,640,390
- taxable at 12.5%	911,511	1,575,368
- taxable at 20%	7,604,486	(2,892,260)
Theoretical income tax (credit)/charge calculated at the applicable tax rate of 20% and 12.5% (2020: 20% and 12.5%)	1,634,836	(381,531)

- non-taxable income	(228,223)	(533,881)
- non-deductible expenses	582,857	322,321
Deferred income tax charge in respect of withholding income tax on dividends to be distributed	186,170	-
Withholding income tax on dividends distributed	262,599	599,940
Adjustments of income tax in respect of prior years and tax penalties	1,182,454	16,611
Other	(98,549)	3,311
Income tax expense	3,522,144	26,771

26. Income tax (continued)

Differences between IFRS as adopted by the EU and local statutory taxation regulations give rise

to certain temporary differences between the carrying value of certain assets and liabilities for financial reporting purposes and their tax bases. Deferred income taxes are attributable to the following:


	1 January 2021	Deferred income tax assets/ (liabilities) acquisition/ disposal	Deferred income tax credited/ (charged) to other comprehensive income	Deferred income tax credited/ (charged) to profit or loss	31 December 2021

Tax effects of deductible/ (taxable) temporary differences:
Property, plant and equipment	(1,434,441)	(213)	-	(960,000)	(2,394,654)
Impairment of receivables	(545,708)	-	-	714,493	168,785
Payables	188,089	-	-	(65,819)	122,270
Financial assets	478,645	-	-	(1,255,477)	(776,832)
Inventory and biological assets	852,997	-	-	276,826	1,129,823
Borrowings	(2,301,061)	-	-	399,076	(1,901,985)
Tax loss carried-forwards	5,185,956	4,851	-	711,287	5,902,094
Lease liability	361,487	-	-	(17,402)	344,085
Right-of-use assets	(380,062)	-	-	(14,741)	(394,803)
Withholding income tax on dividends to be distributed	-	-	-	(186,170)	(186,170)
Other	673,217	-	-	273,194	946,411
Net deferred income tax asset/(liability)	3,079,119	4,638	-	(124,733)	2,959,024

Recognised deferred income tax assets	3,566,168				4,835,268
Recognised deferred income tax liabilities	(487,049)				(1,876,244)


	1 January 2020	Deferred income tax assets/ (liabilities) acquisition/ disposal	Deferred income tax credited/ (charged) to other comprehensive income	Deferred income tax credited/ (charged) to profit or loss	31 December 2020

Tax effects of deductible/ (taxable) temporary differences:
Property, plant and equipment	(1,188,904)	-	-	(245,537)	(1,434,441)
Impairment of receivables	(465,199)	-	-	(80,509)	(545,708)
Payables	(180,134)	-	-	368,223	188,089
Financial assets	210,604	-	(7,070)	275,111	478,645
Inventory and biological assets	268,649	-	-	584,348	852,997
Borrowings	(2,826,526)	-	-	525,465	(2,301,061)
Tax loss carried-forwards	5,020,048	(734)	-	166,642	5,185,956
Lease liability	298,317	-	-	63,170	361,487
Right-of-use assets	(288,440)	-	-	(91,622)	(380,062)
Other	509,591	19	-	163,607	673,217
Net deferred income tax asset/(liability)	1,358,006	(715)	(7,070)	1,728,898	3,079,119

Recognised deferred income tax assets	1,852,983				3,566,168
Recognised deferred income tax liabilities	(494,977)				(487,049)

26. Income tax (continued)

Starting from 1 January 2017 the amendments to the Russian tax legislation became effective in respect of tax loss carry-forwards. The amendments affect tax losses incurred and accumulated since 2007 that have not been utilised. The 10-year expiry period for tax loss carry-forwards no longer applies. The amendments also set limitation on utilisation of tax loss carry forwards that will apply during the period from 2017 to 2020, later this period was prolonged to 2024. The amount of losses that can be utilised each year during that period is limited to 50% of annual taxable profit.

In the context of the Group's current structure tax losses and current income tax assets of different companies may not be set off against taxable profits and current income tax liabilities of other companies and, accordingly, taxes may accrue even where there is a net consolidated tax loss. Therefore, deferred income tax assets and liabilities are offset only when they relate to the same taxable entity.


	31 December 2021	31 December 2020
Deferred income tax assets:
- Deferred income tax assets to be recovered after more than 12 months	2,657,466	2,576,008
- Deferred income tax assets to be recovered within 12 months	2,177,802	990,160
	4,835,268	3,566,168
Deferred income tax liabilities:
- Deferred income tax liabilities to be settled after more than 12 months	(1,649,258)	(275,985)
- Deferred income tax liabilities to be settled within 12 months	(226,986)	(211,064)
	(1,876,244)	(487,049)
Total net deferred income tax asset	2,959,024	3,079,119

Temporary differences associated with undistributed earnings of subsidiaries totalled RR 185,184,106 (2020: RR 105,199,322). No deferred income tax liability was recognised as the Group is able to control the timing of reversal of those temporary differences and it is probable that they will not reverse in the foreseeable future. For those temporary differences that will reverse in the foreseeable future correspondent deferred income tax liabilities was recognized in the amount of RR 186,170 (2020: nil)

On 13 September 2021 the Board of Directors has approved a new dividend policy and increased minimal payout ratio of dividends of the Company from 25% to 50%. As the dividends will be distributed from net income of the reporting periods, they will be subject to current withholding income tax at the applicable rate.

Refer to Note 31 "Contingencies" for description of tax risks and uncertainties.

27. Related party transactions

Parties are generally considered to be related if the parties are under common control or if one party has the ability to control the other party or can exercise significant influence or joint control over the other party in making financial and operational decisions. In considering each possible related party relationship, attention is directed to the substance of the relationship, not merely the legal form.

The Company is controlled by GRANADA CAPITAL CY LIMITED, incorporated in Cyprus, which owns 56.2% of the Company's shares. The parent entity which prepares consolidated financial statements of the largest and smallest body of undertakings of which the Company forms part as a subsidiary undertaking, is GRANADA CAPITAL CY LIMITED, which is incorporated in Cyprus with registered office at 205 Archiepiskopou Makariou, Victory House, Flat/Office 211 A, CY-3030, Limassol, Cyprus.

As at 31 December 2021 and 2020, the ultimate controlling party of the Company is Mr. Vadim Moshkovich (the "Owner"), who ultimately controls 56.2% of the total issued shares as at 31 December 2021 (2020: 70.7%).

Key management personnel

Share option incentive scheme

In 2017 the Group initiated a share option incentive scheme for its top-management. Under this scheme

Related party transactions (continued)

the employees were granted GDRs of the Company provided they remained in their position up to a specific date in the future. The amount of GDRs granted were dependent on the average market prices of GDRs for the period preceding this date. Vesting period of the scheme ended by 31 December 2019. No expenses or gains were recognized under the scheme for the years ended 31 December 2021 and 2020, no GDRs of the Company were transferred to the employees under the scheme in 2021 (2020: 31,000 GDRs amounting to RR 0).

As at 31 December 2021, the share-based payment reserve accumulated in equity as a result of the share-based payment transactions amounted to RR 1,313,691 (2020: RR 1,313,691).

Other remuneration to key management personnel

Remuneration to 12 (2020: 12) representatives of key management personnel, included in payroll costs, comprised short-term remuneration such as salaries, discretionary bonuses and other short-term benefits totalling RR 1,608,744 including RR 235,239 payable to the State Pension Fund (2020: RR 1,211,653 and RR 104,895 respectively).

The Company Directors' remuneration

Included in the share-based compensation and other remuneration to Company Directors disclosed above, are the Company Directors' fees, salaries and other short-term benefits totalling RR 1,187,689 including RR 156,339 payable to the State Pension Fund (2020: RR 803,673 and RR 68,761 respectively) for the year ended 31 December 2021.

Dividends paid to the Company Directors

During the year ended 31 December 2021 the dividends paid to the Company Directors amounted to RR 1,478,145 (2020: RR 383,216).

Loan agreements with the Key management personnel

Balances and transactions under loan agreements with Key management personnel consist of the following:


Transactions	31 December 2021	31 December 2020

Operating foreign exchange differences gain/ (loss), net	(987)	-

Balances	31 December 2021	31 December 2020

Trade accounts payable to related parties	-	45

Entities controlled by the Owner

Dividends paid to entities controlled by the Owner

During the year ended 31 December 2021 the dividends paid to entities controlled by the Owner amounted RR 14,026,673 (2020: RR 3,691,102).

27. Related party transactions (continued)

Balances and transactions with entities controlled by the Owner are presented in the table below:


	31 December 2021	31 December 2020

Transactions
Sales of goods and services	2,840	198
Purchases of services	4,022	3,060
Charitable donations and social costs	7,088	208,762
Repayment of lease liabilities	168,681	156,047
Short-term loans repaid	-	4,066,495
Interest expenses	-	5,898
Interest paid	-	13,249


	31 December 2021	31 December 2020

Balances
Trade receivables from related parties, gross	24	24
Other receivables from related parties, gross	1,138	402
Prepayments to related parties, gross	82,435	76,209
Lease liabilities	(1,331,054)	(1,288,163)

Lease liabilities relate to the rent of Moscow office premises from a related party for an expected lease period of 20 years. Liability at 31 December 2021 and 31 December 2020 is accounted for in accordance with IFRS 16.

Associates

Balances and transactions with associates are presented in the table below:


	31 December 2021	31 December 2020

Transactions
Purchases of services	559	370
Purchases of goods	18,409	-


	31 December 2021	31 December 2020

Balances
Other receivables from related parties, gross	51,513	51,513
Trade receivables from related parties, gross	509	49
Provision for impairment of trade receivables from related parties	(509)	(49)
Trade and other payables	(110)	(63)

28. Earnings per share

Basic earnings per share is calculated by dividing the profit attributable to equity holders of the Company by the weighted average number of ordinary shares in issue during the year excluding the effect of GDRs purchased by the Company and held as treasury shares.

The Company has no significant dilutive potential ordinary shares; therefore, the diluted earnings per share equals the basic earnings per share.


	2021	2020

Profit for the year attributable to the Company's equity holders	41,477,865	24,359,786
Weighted average number of ordinary shares in issue	26,906,270	26,905,237
Basic and diluted earnings per share (RR per share)	1 541.57	905.39

29. Segment information

Operating segments are components that engage in business activities that may earn revenues or incur expenses, whose operating results are regularly reviewed by the chief operating decision maker (CODM) and for which discrete financial information is available. The CODM is a person or a group of persons who allocates resources and assesses the performance of the Group. The functions of CODM are performed by the Board of Directors of ROS AGRO PLC.

Description of products and services from which each reportable segment derives its revenue

The Group is organised on the basis of four main business segments:

· Sugar - processing of raw sugar and production of sugar from sugar-beet;

· Meat - cultivation of pigs and meat processing;

· Agriculture - agricultural production (cultivation of sugar-beet, grain and other agricultural crops);

· Oil and Fat - vegetable oil extraction and processing.

Certain of the Group's businesses are not included within the reportable operating segments, as they are not included in the reports provided to the CODM. The results of these operations are included in "Other" caption. The Company, JSC Rusagro Group and LLC Group of Companies Rusagro that represent

the Group's head office and investment holding functions and earn revenue considered incidental

to the Group's activities are included in "Other" caption.

There were no changes in approach to the identification and measurement of operating segment profit or loss, assets and liabilities.

Factors that management used to identify the reportable segments

The Group's segments are strategic business units that focus on different customers. They are managed separately because of the differences in the production processes, the nature of products produced and required marketing strategies.

Financial information reviewed by the CODM includes:

· Quarterly reports containing information about income and expenses by business units (segments) based on IFRS numbers, that may be adjusted to present the segments results as if the segments operated as independent business units and not as the division within the Group;

· Quarterly reports with a breakdown of separate material lines of IFRS consolidated statement

of financial positions and IFRS consolidated statement of cash flows;

· In addition to the main financial indicators, operating data (such as yield, production volumes, cost per unit, staff costs) and revenue data (volumes per type of product, market share) are also reviewed by the CODM on a quarterly basis.

Measurement of operating segment profit or loss, assets and liabilities

The CODM assesses the performance of the operating segments based on the Adjusted EBITDA figure for the period. Adjusted EBITDA figure is not an IFRS measure. Adjusted EBITDA is reconciled to IFRS operating profit in this Note.

In 2020 the Group updated its EBITDA calculation within Other operating income/(expenses) outlining non-recurring items in order to reflect more precisely the operating activities of the Company. Adjusted EBITDA is defined as operating profit before taking into account:

· depreciation and amortisation;

· non-recurring other operating adjustment (Note 23);

29. Segment information (continued)

· the difference between the gain on revaluation of biological assets and agricultural produce recognised in the year and the gain on initial recognition of agricultural produce attributable

to realised agricultural produce for the year and revaluation of biological assets attributable

to realised biological assets and included in cost of sales;

· share-basetion;

· provision/ (reversal of provision) for net realisable value of agricultural products in stocks

· provision / (reversal of provision) for impairment of loans issued.

Transactions between operating segments are accounted for based on financial information of individual segments that represent separate legal entities.

Analysis of revenues by products and services

Each business segment except for the "Agriculture" and "Oil & Fat" segments is engaged in the production and sales of similar or related products (see above in this note). The "Agriculture" segment in addition to its main activity of growing and harvesting agricultural crops, was engaged in the cultivation of dairy cattle livestock until October, 2021 when assets of Rusagro-Moloko were sold to a third party. Related revenue from sales of milk and other livestock products was RR 116,611 (2020: RR 205,997). The "Oil and Fat" segment in additional to its main activity of vegetable oil extraction and processing is engaged in the production of milk products, including dry milk textures and cheese products. Related revenue from milk products was RR 4,866,075 (2020: RR 3,787,225). Dairy Products segment are included in Oil and Fat segment in 2021 financial year, 2020 financial year results were corrected accordingly.

For the amount of revenue from services, which comprise mainly grain elevator services and processing of sugar beet for third party agricultural enterprises, see Note 19.

Geographical areas of operations

All the Group's assets are located in the Russian Federation. Distribution of the Group's sales between countries on the basis of the customers' country of domicile was as follows:


	2021	2020

Russian Federation	157,316,736	107,677,304
Foreign countries	65,615,703	51,293,731
Total	222,932,439	158,971,035

Among key customers from foreign countries are Turkey, CIS countries, Switzerland, China, Japan.

Major customers

The Group has no customer or group of customers under common control who would account for more than 10% of the Group's consolidated revenue.

29. Segment information (continued)

Information about reportable segment adjusted EBITDA, assets and liabilities

Segment information for the reportable segments' assets and liabilities as at 31 December 2021 and 2020 is set out below:


2021	Sugar	Meat	Agriculture	Oil and Fat	Other	Eliminations	Total

Assets	110,264,224	86,800,384	68,869,840	127,096,588	255,378,779	(286,088,763)	362,321,052
Liabilities	89,631,913	56,471,863	40,321,089	85,525,732	135,978,028	(193,482,768)	214,445,857
Additions to non-current assets*	1,040,334	13,423,203	3,605,236	31,300,649	671,984	-	50,041,406


2020	Sugar	Meat	Agriculture	Oil and Fat**	Other**	Eliminations	Total

Assets	58,114,485	77,953,893	59,110,299	52,514,406	176,044,412	(147,588,908)	276,148,587
Liabilities	41,201,441	51,419,029	34,167,859	50,459,015	58,684,587	(85,817,742)	150,114,189
Additions to non-current assets*	1,309,376	14,356,807	3,783,597	1,927,505	496,309	-	21,873,594

* Additions to non-current assets exclude additions to financial instruments, assets held for sale, goodwill and restricted cash.

** Dairy Products segment was included in Oil and Fat segment in 2021 financial year (Other segment in 2020), 2020 financial year results were corrected accordingly.

29. Segment information (continued)

Segment information for the reportable segments' adjusted EBITDA for the years ended 31 December 2021 and 2020 is set out below:


2021	Sugar	Meat	Agriculture	Oil and Fat	Other	Eliminations	Total

Sales (Note 19)	36,360,566	39,628,064	41,881,010	125,236,601	719,452	(20,893,254)	222,932,439
Net (loss) / gain on revaluation of biological assets and agricultural produce (Note 9)	-	(370,486)	2,609,949	-	-	1,169,846	3,409,309
Cost of sales (Note 20)	(26,850,141)	(33,744,934)	(18,773,771)	(108,855,523)	(371,867)	19,347,955	(169,248,281)
incl. Depreciation	(2,766,162)	(3,965,508)	(2,547,072)	(2,877,234)	(9,186)	(85,607)	(12,250,769)
Net loss from trading derivatives	-	(5)	-	-	-	-	(5)
Gross profit	9,510,425	5,512,639	25,717,188	16,381,078	347,585	(375,453)	57,093,462

Distribution and Selling, General and administrative expenses (Notes 21, 22)	(3,958,396)	(5,728,548)	(3,396,730)	(7,463,073)	(2,646,176)	1,741,888	(21,451,035)
incl. Depreciation and amortisation	(72,862)	(910,976)	(357,854)	(348,591)	(90,102)	85,607	(1,694,778)
Other operating income/(expenses), net (Note 23)	677,174	1,353,391	598,467	(726,058)	27,175,376	(26,744,173)	2,334,177
incl. Reimbursement of operating costs (government grants)	576,559	516,862	546,424	495,720	-	-	2,135,565
Incl. Non-recurring other operating adjustment) (Note 23)	105,924	489,812	(37,563)	(1,368,049)	27,067,942	(25,805,013)	453,053
Reversal of provision for impairment of loans issued	-	-	-	-	4,574,481	-	4,574,481
Operating profit	6,229,203	1,137,482	22,918,925	8,191,947	29,451,266	(25,377,738)	42,551,085

Adjustments:
Depreciation and amortization included in Operating Profit	2,839,024	4,876,484	2,904,926	3,225,825	99,288	-	13,945,547
Non-recurring other operating adjustment (Note 23)	(105,924)	(489,812)	37,563	1,368,049	(27,067,942)	25,805,013	(453,053)
Net (loss)/ gain on revaluation of biological assets and agricultural produce	-	370,486	(2,609,949)	-	-	(1,169,846)	(3,409,309)
Reversal of provision for impairment of loans issued	-	-	-	-	(4,574,481)	-	(4,574,481)
Adjusted EBITDA*	8,962,303	5,894,640	23,251,465	12,785,821	(2,091,869)	(742,571)	48,059,789

* Non-IFRS measure

29 Segment information (continued)


2020	Sugar	Meat	Agriculture	Oil and Fat**	Other**	Eliminations	Total

Sales (Note 19)	28,112,519	32,434,214	34,347,506	79,726,251	631,108	(16,280,563)	158,971,035
Net (loss)/ gain on revaluation of biological assets and agricultural produce (Note 9)	-	(681,302)	3,582,520	-	-	2,989,229	5,890,447
Cost of sales (Note 20)	(21,238,160)	(27,375,635)	(19,059,850)	(64,547,430)	(477,625)	11,566,042	(121,132,658)
incl. Depreciation	(2,605,853)	(3,716,132)	(2,861,216)	(542,826)	(10,639)	(75,387)	(9,812,053)
Net gain from trading derivatives	10,552	-	-	-	-	-	10,552
Gross profit	6,884,911	4,377,277	18,870,176	15,178,821	153,483	(1,725,292)	43,739,376

Distribution and Selling, General and administrative expenses (Notes 21, 22)	(3,399,788)	(2,713,324)	(3,732,770)	(6,730,675)	(1,704,354)	1,142,621	(17,138,290)
incl. Depreciation and amortisation	(83,738)	(218,146)	(386,864)	(184,327)	(184,305)	75,387	(981,993)
Other operating income/(expenses), net (Note 23)	602,466	653,934	459,868	(533,103)	15,582,175	(14,472,323)	2,293,017
incl. Reimbursement of operating costs (government grants)	179,564	104,836	299,020	347,210	-	-	930,630
incl. Non-recurring other operating adjustment) (Note 23)	425,102	459,983	71,372	(732,371)	15,526,199	(13,936,656)	1,813,629
Provision for impairment of loans issued	-	-	-	-	(5,070,598)	-	(5,070,598)
Operating profit	4,087,589	2,317,887	15,597,274	7,915,043	8,960,706	(15,054,994)	23,823,505

Adjustments:
Depreciation and amortisation included in Operating Profit	2,689,591	3,934,278	3,248,080	727,153	194,944	-	10,794,046
Non-recurring other operating adjustment (Note 23)	(425,102)	(459,983)	(71,372)	732,371	(15,526,199)	13,936,656	(1,813,629)
Net (loss)/ gain on revaluation of biological assets and agricultural produce	-	681,302	(3,582,520)	-	-	(2,989,229)	(5,890,447)
Provision for impairment of loans issued	-	-	-	-	5,070,598	-	5,070,598
Adjusted EBITDA*	6,352,078	6,473,484	15,191,462	9,374,567	(1,299,951)	(4,107,567)	31,984,073

* Non-IFRS measure

** Dairy Products segment was included in Oil and Fat segment in 2021 financial year (Other segment in 2020), 2020 financial year results were corrected accordingly.

30. Financial risk management

Financial risk factors

The Group's activities expose it to a variety of financial risks: market risk (including commodity price risk, foreign exchange risk, cash flow interest rate risk and fair value interest rate risk), credit risk and liquidity risk. The Group's overall risk management programme focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the Group's financial performance. The Group does not use derivative financial instruments to hedge its risk exposure, except in 2020 for raw sugar commodity price risk management as described below.

Operating risk management is carried out on the level of the finance function of the Group's business segments with overall monitoring and control by management of the Group. The management is implementing principles for overall risk management, as well as policies covering specific areas, such as foreign exchange risk, interest-rate risk, credit risk, use of non-derivative financial instruments, and investing excess liquidity.

Credit risk

The credit risk represents the risk of losses for the Group owing to default of counterparties on obligations to transfer to the Group cash and cash equivalents and other financial assets.

Activities of the Group that give rise to credit risk include granting loans, making sales to customers on credit terms, placing deposits with banks and performing other transactions with counterparties giving rise to financial assets.

The Group's maximum exposure to credit risk at the reporting date without taking account of any collateral held is as follows:


	31 December 2021	31 December 2020
Long-term financial assets
Bonds held to collect (Note 10)	19,900,000	19,900,000
Bank deposits (Note 10)	14,071,101	14,070,635
Investments in third parties (Note 10)	8,556,556	8,556,556
Bonds held for trading (Note 10)	-	165,129
Total long-term financial assets	42,527,657	42,692,320

Short-term financial assets
Cash and cash equivalents (Note 3)	46,462,179	11,866,798
Bank deposits (Note 4)	18,519,392	-
Financial assets within trade and other receivables (Note 5)	12,000,318	8,829,801
Loans issued (Note 4)	2,119,893	19,137,343
Interest receivable on long-term bonds held to collect (Note 4)	221,734	218,057
Bonds held to collect (Note 4)	140,741	197,523
Short-term restricted cash	47	143,637
Other short-term investments (Note 4)	-	22,692
Interest receivable on bonds held for trading (Note 4)	-	7,908
Total short-term financial assets	79,464,304	40,423,759
Total	121,991,961	83,116,079

As at 31 December 2021 the Group has collateral against RR 56,176 of its trade receivables (31 December 2020: RR 46,887). The Group has geographical concentration of credit risk in the Russian market since the majority of the Group's customers conduct their business in the Russian Federation.

30. Financial risk management (continued)

Credit risk grading system. For measuring credit risk and grading financial instruments by the amount of credit risk, the Group applies two approaches - an Internal Risk-Based (IRB) rating system or risk grades estimated by external international rating agencies (Standard & Poor's - "S&P", Fitch, Moody's). Internal and external credit ratings are mapped on an internally defined master scale with a specified range of probabilities of default as disclosed in the table below:


Master scale credit risk grade	Corresponding internal ratings		Corresponding ratings of external international rating agencies	Corresponding PD interval

Excellent	1 - 6		AAA to BB+	0.01% - 0.05%
Good	7 - 14		BB to B+	0.06% - 1%
Satisfactory	15 - 21		B, B-	1% - 5%
Special monitoring	22 - 25		CCC+ to CC-	6% - 99.9%
Default	26 - 30	C, D-I, D-II			100%

Each master scale credit risk grade is assigned a specific degree of creditworthiness:

· Excellent - strong credit quality with low expected credit risk;

· Good - adequate credit quality with a moderate credit risk;

· Satisfactory - moderate credit quality with a satisfactory credit risk;

· Special monitoring - facilities that require closer monitoring and remedial management; and

· Default - facilities in which a default has occurred.

The IRB system is designed internally, and ratings are estimated by management. Various credit-risk estimation techniques are used by the Group depending on the class of the asset. There are three commonly used types of such systems:

· Model-based - In this system, credit risk ratings are assigned by internally developed statistical models with the limited involvement of credit officers. Statistical models include qualitative and quantitative information that shows the best predictive power based on historical data on defaults.

· Expert judgement-based - In this system, credit risk ratings are assigned subjectively by experienced credit officers based on internally developed methodology and different qualitative and quantitative factors. This approach is based on expert methodology and judgements rather than on sophisticated statistical models.

· Hybrid - This rating system is a combination of the two systems above. It is developed by using historical data combined with expert input.

The Group applies IRB systems for measuring credit risk for the following financial assets: cash and cash equivalents, bank deposits, bonds held for trading.

The table below discloses the credit quality of cash and cash equivalents balances and bank deposits based on credit risk grades at 31 December 2021.

	Cash and cash equivalents	Bank deposits	Total

---	---	---	---
- Excellent	46,444,018	32,590,493	79,034,511
- Good	18,161	-	18,161
Total cash and cash equivalents, excluding cash on hand	46,462,179	32,590,493	79,052,672

30. Financial risk management (continued)

The table below discloses the credit quality of cash and cash equivalents balances and bank deposits based on credit risk grades at 31 December 2020.

	Cash and cash equivalents	Bank deposits	Total

---	---	---	---
- Excellent	11,808,294	14,070,635	25,878,929
- Good	58,504	-	58,504
Total cash and cash equivalents, excluding cash on hand	11,866,798	14,070,635	25,937,433

The credit quality of cash and cash equivalents, bank deposits and restricted cash balances may be summarised as:

		31 December 2021		31 December 2020
	Rating agency	Rating	Balance	Rating	Balance
---	---	---	---	---	---
Alfa Bank	Fitch Ratings	bbb-	34,216,104	bb+	10,243,340
Bank GPB	S&P	bbb-	18,623,438	bb+	149
Vnesheconombank	S&P	bbb-	14,071,107	bbb	14,070,658
Rosselkhozbank	Moody's	Ba1	9,090,345	Ba1	38,392
Sberbank	Fitch Ratings	bbb	3,014,725	bbb	670,168
Credit Suisse	Fitch Ratings	a-	16,821	a-	1,575
Bank NCC	Fitch Ratings	bbb	1,113	bbb	1,002,633
Rosbank	Fitch Ratings	bbb	858	bbb	2,275
Other	-	-	18,208	-	51,880
Total cash at bank, bank deposits (Note 3,10) and restricted cash			79,052,719		26,081,070

Expected credit loss measurement. Expected credit loss is a probability-weighted estimate of the present value of future cash shortfalls. An expected credit loss measurement is unbiased and is determined by evaluating a range of possible outcomes. Expected credit loss measurement is based on four components used by the Group: Probability of Default, Exposure at Default, Loss Given Default and Discount Rate.

Exposure at Default is an estimate of exposure at a future default date, taking into account expected changes in the exposure after the reporting period, including repayments of principal and interest, and expected drawdowns on committed facilities.

· the borrower is more than 90 days past due on its contractual payments;

· international rating agencies have classified the borrower in the default rating class;

· the borrower meets the unlikeliness-to-pay criteria listed below:

- the borrower is deceased;

- the borrower is insolvent;

- it is becoming likely that the borrower will enter bankruptcy.

Forward-looking information incorporated in the ECL models. The Group identified certain key economic variables that correlate with developments in credit risk and ECLs. As with any economic forecast, the projections and likelihoods of occurrence are subject to a high degree of inherent uncertainty, and therefore the actual outcomes may be significantly different to those projected. The Group considers these forecasts to represent its best estimate of the possible outcomes and has analysed the non-linearities and asymmetries within the Group's different portfolios to establish that the chosen scenarios are appropriately representative of the range of possible scenarios. The Group regularly reviews its methodology and assumptions to reduce any difference between the estimates and the actual loss of credit. Such backtesting is performed at least once a year.

The results of backtesting the ECL measurement methodology are communicated to Group Management and further steps for tuning models and assumptions are defined after discussions between authorised persons.

30. Financial risk management (continued)

The Group did not recognise any expected credit loss allowance in respect of loans issued because of significant excess of its collateral value over the gross carrying value of these loans.

Neither past due nor impaired trade receivables relate to the customers who have a long-standing relationship with the Group and a sound trading history.

Concentrations of trade receivables by type of customer are as follows:


	31 December 2021	31 December 2020
Distribution and retail outlets	7,248,772	5,095,469
Manufacturers (candy, juice and other)	4,258,210	3,213,548
Other not categorised	40,524	123,094
Total trade receivables	11,547,506	8,432,111

The majority of the customers do not have independent ratings. To minimize the risk of default on payment of amounts due by counterparties for supplied goods or rendered services the Group regularly revises the maximum amount of credit and grace periods for each significant customer.

Financial assets that are impaired as at the reporting date

The table below shows the analysis of impaired financial assets:


	31 December 2021		31 December 2020
	Nominal value	Impairment	Nominal Value	Impairment
Impaired receivables (Note 5):
- trade receivables	1,777,388	(747,171)	1,141,874	(76,845)
- other receivables	95,204	(95,204)	81,184	(71,477)
Total	1,872,592	(842,375)	1,223,058	(148,322)

Financial assets are impaired when there is evidence that the Group will not receive the full amount due or receive the full amount later than contracted. Factors to consider include whether the receivable is past due, the age of the receivable and past experience with the counterparty.

Liquidity risk

Prudent liquidity risk management implies maintaining sufficient cash and the availability of funding through an adequate amount of committed credit facilities. Due to the dynamic nature of the underlying businesses, Group Treasury aims to maintain flexibility in funding by keeping committed credit lines available. The Group Treasury analyses the net debt position as disclosed in Note 15.

The table below analyses the Group's financial liabilities into relevant maturity groupings based

on the remaining period at the reporting date to the contractual maturity date:


	Carrying value	Contractual undiscounted cash flows
At 31 December 2021	Total	2022	2023	2024-2026	After 2026
Borrowings and loans (Note 15)
- principal amount	170,527,920	194,961,620	107,310,675	9,003,566	25,788,953	52,858,426
- interest	2,195,945	25,505,128	3,620,333	2,472,856	4,397,629	15,014,310
Lease liabilities (Note 12)	6,665,845	7,643,740	611,369	569,575	1,557,975	4,904,821
Financial liabilities within trade and other payables (Note 16)	11,222,919	11,222,919	11,222,919
Total	190,612,629	239,333,407	122,765,296	12,045,997	31,744,557	72,777,557

30. Financial risk management (continued)


	Carrying value	Contractual undiscounted cash flows
At 31 December 2020	Total	2021	2022	2023-2025	After 2025
Borrowings and loans (Note 15)
- principal amount	113,357,741	139,770,853	50,404,705	16,133,646	20,723,547	52,508,955
- interest	1,571,454	28,810,356	3,798,805	2,589,672	5,954,667	16,467,212
Lease liabilities (Note 12)	5,799,367	11,329,467	976,982	917,680	2,380,704	7,054,101
Financial liabilities within trade and other payables (Note 16)	11,092,041	11,092,041	11,092,041	-	-	-
Total	131,820,603	191,002,717	66,272,533	19,640,998	29,058,918	76,030,268

The exchange rates used for calculating payments for bank borrowings denominated in currencies other than Russian Roubles:


	31 December 2021	31 December 2020

US Dollar	74.2926	73.8757
Euro	84.0695	90.6824

In addition, the Group has commitments as disclosed in Note 32.

Market risk

Market risk, associated with financial instruments, is the risk of change of fair value of financial instruments or the future cash flows expected on a financial instrument, owing to change in interest rates, exchange rates, prices for the commodities or other market indicators. From the risks listed above

the Group is essentially exposed to the risks associated with changes in interest rates, exchange rates and commodity prices.

Cash flow and fair value interest rate risk

The Group's income and operating cash flows are exposed to changes in market interest rates.

The Group's interest rate risk arises from short-term and long-term borrowings. Borrowings at variable rates expose the Group to cash flow interest rate risk. Borrowings at fixed rates expose the Group to fair value interest rate risk. The Group's policy is to maintain most of its borrowings in fixed rate instruments. The Group does not have formal policies and procedures in place for management of fair value interest rate risk.

Interest rates under most of the Group's borrowings are fixed. However, the terms of the contracts stipulate the right of the creditor for a unilateral change of the interest rate (both increase and decrease), which can be based, among other triggers, on a decision of the CBRF to change the refinancing rate.

Bank deposits and loans issued bear fixed interest rate and therefore are not exposed to cash flow interest rate risk.

The Group analyses its interest rate exposure on a continuous basis. Various scenarios are considered taking into consideration refinancing, renewal of existing positions and alternative financing. Based on these scenarios, the Group calculates the impact on profit and loss of a defined interest rate shift.

For each scenario, the same interest rate shift is used for all currencies. The scenarios are run only for liabilities that represent the major interest-bearing positions.

During the year ended 31 December 2021 and 31 December 2020 the Group was not exposed to the cash flow interest rate risk as all of the Group's borrowings had fixed rates.

30. Financial risk management (continued)

Foreign exchange risk

As at 31 December 2021 and 2020, foreign exchange risk arises on cash in banks, short-term investments, trade and other receivables, borrowings and trade and other payables denominated in foreign currency (Notes 3, 4, 5, 15 and 16).

At 31 December 2021, if the Russian Rouble had weakened/strengthened by 30% (31 December 2020: 30%) against the US dollar with all other variables held constant, the Group's profit before taxation and equity would have been RR 732,838 (2020: RR 562,822) higher/lower.

At 31 December 2021 if the Russian Rouble had weakened/strengthened by 30% (31 December 2020: 30%) against the Euro with all other variables held constant, the Group's profit before taxation and equity would have been RR 20,922 (2020: RR 170,149) lower/higher.

Purchase price risk

The Group is exposed to equity securities price risk arising on investments held by the Group and classified in the consolidated statement of financial position at fair value through other comprehensive income (Note 10). The Group does not manage its price risk arising from investments in equity securities.

Sales price risk

Changes in white sugar prices are closely related to changes in world raw sugar prices. The storage facilities of own sugar plants permit to build up stocks of white sugar to defer sales to more favourable price periods.

The Group is exposed to financial risks arising from changes in meat and crops prices (Note 9).

Fair value estimation

The estimated fair values of financial instruments have been determined by the Group using available market information, where it exists, and appropriate valuation methodologies. However, judgement is necessarily required to interpret market data to determine the estimated fair value. The Russian Federation continues to display some characteristics of an emerging market and economic conditions continue to limit the volume of activity in the financial markets. Market quotations may be outdated or reflect distress sale transactions and therefore not represent fair values of financial instruments. Management has used all available market information in estimating the fair value of financial instruments.

Financial assets carried at amortised cost

The fair value of floating rate instruments is normally their carrying amount. The estimated fair value

of fixed interest rate instruments is based on estimated future cash flows expected to be received discounted at current interest rates for new instruments with similar credit risk and remaining maturity. Discount rates used depend on credit risk of the counterparty.

Liabilities carried at amortised cost

The fair value of floating rate instruments is normally their carrying amount. The estimated fair value

of fixed interest rate instruments with stated maturity was estimated based on expected cash flows discounted at current interest rates for new instruments with similar credit risk and remaining maturity.

30. Financial risk management (continued)

Financial instruments by measurement categories and fair values as at 31 December 2021


	Amortised cost	At fair value through other comprehen-sive income	At fair value through profit or loss	Total carrying amount	Fair value

Financial assets
Cash and cash equivalents (Note 3)	46,462,179	-	-	46,462,179	46,462,179
Short-term restricted cash	47	-	-	47	47
Short-term loans issued (Note 4)	2,119,893	-	-	2,119,893	2,119,893
Interest receivable on bonds held to collect (Note 4)	221,734	-	-	221,734	173,397
Bank deposits (Note 4)	18,519,392	-	-	18,519,392	18,519,392
Bonds held to collect (Note 4)	140,741	-	-	140,741	140,741
Financial assets within trade and other receivables (Note 5)	12,000,318	-	-	12,000,318	12,000,318
Total short-term financial assets	79,464,304	-	-	79,464,304	79,415,967

Investments in third parties (Note 10)	-	8,556,556	-	8,556,556	8,556,556
Bonds held to collect (Note 10)	19,900,000	-	-	19,900,000	19,900,000
Bank deposits (Note 10)	14,071,101	-	-	14,071,101	14,002,700
Total long-term financial assets	33,971,101	8,556,556	-	42,527,657	42,459,256
Total financial assets	113,435,405	8,556,556	-	121,991,961	121,875,223

Financial liabilities
Short-term borrowings (Note 15)	108,748,840	-	-	108,748,840	108,748,840
Financial liabilities within trade and other payables (Note 16)	11,222,919	-	-	11,222,919	11,222,919
Total short-term financial liabilities	119,971,759	-	-	119,971,759	119,971,759

Long-term borrowings (Note 15)	63,975,025	-	-	63,975,025	63,975,025
Total long-term financial liabilities	63,975,025	-	-	63,975,025	63,975,025
Total financial liabilities	183,946,784	-	-	183,946,784	183,946,784

30. Financial risk management (continued)

Financial instruments by measurement categories and fair values as at 31 December 2020


	Amortised cost	At fair value through other comprehen-sive income	At fair value through profit or loss	Total carrying amount	Fair value

Financial assets
Cash and cash equivalents (Note 3)	11,866,798	-	-	11,866,798	11,866,798
Short-term restricted cash	143,637	-	-	143,637	143,637
Short-term loans issued (Note 4)	19,137,343	-	-	19,137,343	19,214,704
Interest receivable on bonds held to collect (Note 4)	218,057	-	-	218,057	135,320
Interest receivable on bonds held for trading (Note 4)	-	-	7,908	7,908	7,908
Bonds held to collect (Note 4)	197,523	-	-	197,523	197,523
Other short-term investments (Note 4)		-	22,692	22,692	22,692
Financial assets within trade and other receivables (Note 5)	8,829,801	-	-	8,829,801	8,829,801
Total short-term financial assets	40,393,159	-	30,600	40,423,759	40,418,383

Bonds held for trading (Note 10)	-	-	165,129	165,129	165,129
Investments in third parties (Note 10)	-	8,556,556	-	8,556,556	8,556,556
Bonds held to collect (Note 10)	19,900,000	-	-	19,900,000	19,900,000
Bank deposits (Note 10)	14,070,635	-	-	14,070,635	13,961,012
Total long-term financial assets	33,970,635	8,556,556	165,129	42,692,320	42,582,697
Total financial assets	74,363,794	8,556,556	195,729	83,116,079	83,001,080

Financial liabilities
Short-term borrowings (Note 15)	51,753,475	-	-	51,753,475	51,753,475
Financial liabilities within trade and other payables (Note 16)	11,092,041	-	-	11,092,041	11,092,041
Total short-term financial liabilities	62,845,516	-	-	62,845,516	62,845,516

Long-term borrowings (Note 15)	63,175,720	-	-	63,175,720	63,175,720
Total long-term financial liabilities	63,175,720	-	-	63,175,720	63,175,720
Total financial liabilities	126,021,236	-	-	126,021,236	126,021,236

For the purposes of measurement, IFRS 9 "Financial Instruments" classifies bonds held to collect, loans issued, long-term borrowings to Level 2 of the fair value hierarchy. Other financial instruments except bonds held for trading are classified to level 3 of the fair value hierarchy.

Fair value of bonds held-for trading is derived from open active markets and is within level 1 of the fair value hierarchy.

The fair values in level 2 and level 3 of the fair value hierarchy were estimated using the discounted cash flows valuation technique. The fair value is based on discounting of cash flows using 10.7-15.6% (2020: 9.9-20.3%) discount rate.

The valuation technique, inputs used in the fair value measurement for level 3 measurements and related sensitivity to reasonably possible changes in those inputs in relation to the investment at fair value through other comprehensive income (Note 10) are as follows at 31 December 2021:


	Inputs used	Range of inputs (weighted average)	Reasonable change	Sensitivity of fair value measurement
Investment at FV through OCI
	EBITDA Margin	17 - 24%	± 1%	± 462,808
Terminal growth rate	1.8%	± 0.5%	± 120,515
WACC	15.6%	± 0.5%	± 225,302

30. Financial risk management (continued)


	Inputs used	Range of inputs (weighted average)	Reasonable change	Sensitivity of fair value measurement
Investment at FV through OCI
	EBITDA Margin	16 - 22%	± 1%	± 523,765
Terminal growth rate	1.8%	± 0.5%	± 161,302
WACC	12.0%	± 0.5%	± 274,518

Sensitivity of fair value to valuation inputs for financial assets and financial liabilities, if changing one or more of the unobservable inputs to reflect reasonably possible alternative assumptions would not be significant. For this purpose, significance was judged with respect to profit or loss, and total assets or total liabilities, or, when changes in fair value are recognised in other comprehensive income, total equity.

There were no changes in the valuation technique for level 3 recurring fair value measurements during the year ended 31 December 2021 (2020: none).

Capital management

The primary objective of the Group's capital management is to maximize participants' return while sustaining a reasonable level of financial risks. The Group does not have a quantified target level

of participants' return or capital ratios. To fulfil capital management objectives while providing for external financing of regular business operations and investment projects, the Group management compares expected return of these operations and projects with the costs of debt and maintains prudent financial risk management as described above.

The Group companies complied with all externally imposed capital requirements throughout 2021 and 2020.

31. Contingencies

Tax legislation

Russian tax and customs legislation which was enacted or substantively enacted at the end of the reporting period, is subject to varying interpretations when being applied to the transactions and activities of the Group. Consequently, tax positions taken by management and the formal documentation supporting the tax positions may be challenged tax authorities. Russian tax administration is gradually strengthening, including the fact that there is a higher risk of review of tax transactions without a clear business purpose or with tax incompliant counterparties. Fiscal periods remain open to review by the authorities in respect of taxes for three calendar years preceding the year when decisions about the review was made. Under certain circumstances reviews may cover longer periods.

Russian transfer pricing legislation is generally aligned with the international transfer pricing principles developed by the Organisation for Economic Cooperation and Development (OECD), with certain specific features. Transfer pricing legislation provides for the possibility of additional tax assessment for controlled transactions (transactions between related parties and certain transactions between unrelated parties) if such transactions are not on an arm's length basis. Management has implemented internal controls to be in compliance with current transfer pricing legislation.

Tax liabilities arising from controlled transactions are determined based on their actual transaction prices. It is possible, with the evolution of the interpretation of the transfer pricing rules, that such prices could be challenged. The impact of any such challenge cannot be reliably estimated; however, it may be significant to the financial position and/or the Group's operations.

31. Contingencies (continued)

Starting from 2015 new rules were put in place establishing when foreign entities can be viewed as managed from Russia and consequently can be deemed Russian tax residents. Russian tax residency means that such legal entity's worldwide income will be taxed in Russia.

The tax liabilities of the Group were determined on the assumption that the foreign companies of the Group were not subject to applicable Russian taxes, because they did not have a permanent establishment in Russia and were not Russian profit tax residents by way of application of the new tax residency rules. However, the Russian tax authorities may challenge this interpretation of relevant legislation in regard to the foreign companies of the Group. The impact of any such challenge cannot be reliably estimated currently; however, it may be significant to the financial position and/or the overall operations of the Group.

The Group's Management believes that its interpretation of the relevant legislation is appropriate, and the Group's tax and customs positions will be sustained. Accordingly, at 31 December 2021 no provision for potential tax liabilities had been recorded (2020: no provision). Management will vigorously defend the Group's positions and interpretations that were applied in determining taxes recognised in these consolidated financial statements if these are challenged by the authorities.

Social obligations

Some production companies of the Group have collective agreements signed with the employees. Based on these contracts the companies make social payments to the employees. The amounts payable are determined in each case separately and depend primarily on performance of the company. These payments do not satisfy the liability recognition criteria listed in IAS 19, "Employee Benefits". Therefore, no liability for social obligations was recognised in these consolidated financial statements.

Legal proceedings

From time to time and in the normal course of business, claims against the Group may be received. On the basis of its own estimates, management is of the opinion that no material losses will be incurred in respect of claims.

There are no current legal proceedings or other claims outstanding which could have a material effect on the results of operations and financial position of the Group.

Operating environment of the Group

The uncertainties related to the operating environment of the Group are described in Note 1.

32. Commitments

Contractual capital expenditure commitments

As at 31 December 2021 the Group had outstanding contractual commitments in respect of purchases

or construction of property, plant and equipment in the amount of RR 6,705,623 (31 December 2020

RR: 6,974,843).

33. Subsequent events

Dividends. Subsequent to the year ended 31 December 2021, the Board of Directors recommends the payment of additional dividends out of the profits for the year 2021 to the amount of RR 11,928,542. Given that the Company has already paid interim dividends for 2021 to the amount of RR 8,755,947, the total dividend out of the profits for 2021 would amount to RR 20,684,489. The dividend per share will be fixed at the dividend record date set on 1 April 2022. The proposed dividend is subject to approval by the shareholders at the Annual General Meeting. These consolidated financial statements do not reflect the dividends that have not been approved on the reporting date.

33. Subsequent events (continued)

From 1 January 2022, Timur Lipatov became Rusagro's Chief Executive Director. Contract of Maxim Basov, previous CEO, expired on 31 December 2021.

As part of bankruptcy procedures the Group transferred back to the insolvency estate the interest on loans paid by Solnechnye Producty during 2021 in the amount of RR 2,354,811. Cash is expected to be received back until 30 June 2022.

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact [email protected] or visit www.rns.com.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our Privacy Policy.

END

FR SELSAAEESEEE

AI Terminal

ROSS GROUP PLC

4662_10-k_2022-02-28_141707c5-aadc-41d1-9052-3e5016548518.html

1. Background

2. Summary of significant accounting policies

3. Cash and cash equivalents

4. Short-term investments

5. Trade and other receivables

6. Prepayments

7. Other taxes receivable

8. Inventories

9. Biological assets

10. Long-term investments

11. Property, plant and equipment

12. Right-of-use assets and lease liabilities

13. Intangible assets

14. Share capital, share premium and transactions with non-controlling interests

15. Borrowings

16. Trade and other payables

17. Other taxes payable

18. Government grants

19. Sales

20. Cost of sales

21. Distribution and selling expenses

22. General and administrative expenses

23. Other operating income, net

24. Interest expense and other finance income/ (costs), net

25. Goodwill

26. Income tax

27. Related party transactions

28. Earnings per share

29. Segment information

30. Financial risk management

31. Contingencies

32. Commitments

33. Subsequent events

More from ROSS GROUP PLC

Talk to a Data Expert