Agria Group Holding AD

Annual Report (ESEF) • Apr 29, 2024

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AGRIA GROUP HOLDING AD CONSOLIDATED FINANCIAL STATEMENTS ANNUALL CONSOLIDATED REPORT December 31, 2023 AGRIA GROUP HOLDING AD Consolidated financial statements December 31, 2023 2 CONTENTS: CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2023.................3 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS..........................8 ANNUAL CONSOLIDATED REPORT..................................................................48 ADDITIONAL INFORMATION UNDER SUPPLEMENT No 3 TO ART. 10..........................................................................97 CONSOLIDATED DECLARATION ON CORPORATE GOVERNANCE.............99 CONSOLIDATED REPORT OF THE BOARD OF DIRECTORS OF AGRIA GROUP HOLDING AD ON THE APPLICATION OF THE REMUNERATION POLICY..................................................................................................................110 CONSOLIDATED NON-FINANCIAL DECLARATION.....................................................................................................119 DECLARATION UNDER ART. 100n (4), ITEM 4 OF POSA................................151 AGRIA GROUP HOLDING AD Consolidated financial statements December 31, 2023 3 CONSOLIDATED FINACIAL STAEMENTS AS AT DECEMBER 31, 2023 AGRIA GROUP HOLDING AD _____________ Notes 31.12.2023 31.12.2022 № BGN'000 BGN'000 ASSETS Non-current assets Property, plant and equipment 4 359 404 259 712 Intangible assets 5 182 111 Non-current investments 6 10 634 10 634 Non-current receivables 7 4 904 2 097 Goodwill 8 2 326 2 326 Total non-current assets 377 450 274 880 Current assets Inventories 9 149 421 108 645 Accounts receivable and loans granted 10 126 578 110 024 Cash and cash equivalents 11 6 524 4 548 Total current assets 282 523 223 217 Total assets 659 973 498 097 EQUITY AND LIABILITIES Equity Share capital 12 6 800 6 800 Share buy-back (1 390) (1 390) Reserves 13 106 759 108 073 Retained earnings 194 938 171 687 Total 307 107 285 170 Minority interest - - Total equity 307 107 285 170 Non-current liabilities Interest bearing bank loans 14 63 993 34 954 Lease contracts obligations 15 22 639 15 944 Deferred tax liabilities, net 16 9 731 8 670 Trade loans 17 - - Other non-current liabilities 18 1 451 1 141 Total non-current liabilities 97 814 60 709 Current liabilities 19 255 052 152 218 Total liabilities 352 866 212 927 Total equity and liabilities 659 973 498 097 Emil Raykov Asya Yordanova (Executive Director) (Chief Accountant) Audit Company Marian Nikolov Primorska Audit Company Ltd. Registered auditor, Reg. N: 086 responsible for the audit Ilia Iliev Reg. N: 0601 Managing partner April 29, 2024 The accompanying notes are an integral part of these consolidated financial statements. CONSOLIDATED STATEMENT OF FINANCIAL POSITION as of December 31, 2023 ____________ Conslolidated financial statements as of December 31, 2023 4 AGRIA GROUP HOLDING AD _______________ Notes Year Year № ended ended 31.12.2023 31.12.2022 BGN'000 BGN'000 Income from sales 20 726 250 696 429 Income from grovernment grants 21 12 662 7 697 Other income 22 3 561 1 917 Carrying amount of goods sold 508 939 463 099 Materials expenses 23 134 619 108 535 Hired services 24 35 794 21 034 Personnel expenses 25 29 367 22 240 Depreciation and amortization 4,5 21 756 11 861 Other expenses 26 3 125 1 199 Impairment 27 675 6 760 Changes in inventories (5 895) (7 436) Total operating expenses 728 380 627 292 Financial income 28 3 183 3 291 Financial expenses 29 (18 196) (5 320) Profit from acquisition of subsidiaries 30 32 156 - Profit before tax 31 236 76 722 Income tax expense 31 2 528 8 142 Profit for the period 28 708 68 580 Other components of comprehensive income: Components not to be reclassified in proft or loss: Profit from revaluation of property, plant and equipment - 47 355 Revaluation of retirement benefit obligations (24) 86 Income tax expense, concerning other components of thecomprehensive income 2 (4 744) Other comprehensive income, net of tax (22) 42 697 Total comprehensive income for the period 28 686 111 277 Referring to: Owners of parent company 28 686 111 277 Minority interest - - 28 686 111 277 Earnings per share (BGN) 32 4,22 10,09 Emil Raykov Asya Yordanova (Executive Director) (Chief Accountant) Audit Company Marian Nikolov Primorska Audit Company Ltd. Registered auditor, Reg. N: 086 responsible for the audit Ilia Iliev Reg. N: 0601 Managing partner April 29, 2024 The accompanying notes are an integral part of these consolidated financial statements. CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME for the year ended December 31, 2023 ________________ Consolidated financial statements as of December 31, 2023 5 AGRIA GROUP HOLDING AD _____________________ Attributable to the owners of the parent company Share Purchased Legal Revaluation Revaluation of Premium Retained Total Minority Total capital owen shares reserves reserves defined benefit obligations reserves earnings equity interest BGN'000 BGN'000 BGN'000 BGN'000 BGN'000 BGN'000 BGN'000 BGN'000 BGN'000 BGN'000 Balance at January 1, 2022 6 800 - 1 786 50 081 (41) 13 668 105 489 177 783 519 178 302 Profit for the period - - - - - - 68 580 68 580 - 68 580 Other comprehensive income for the period, net of tax - - 42 620 77 - - 42 697 - 42 697 Total comprehensive income for the period - - - 42 620 77 - 68 580 111 277 - 111 277 Share-buy back - (1 390) - - - - - (1 390) - (1 390) Revaluation reserve written off - - - (250) - - 250 - - - Increase of legal reserves - - 132 - - - (132) - - - Effect of monitory interest acquisiiton - - - - - - - - (519) (519) Dividends dsitribution - - - - - - (2 500) (2 500) - (2 500) Balance at December 31, 2022 6 800 (1 390) 1 918 92 451 36 13 668 171 687 285 170 - 285 170 Profit for the period - - - - - - 28 708 28 708 - 28 708 Other comprehensive income for the period, net of tax - - - - (22) - - (22) - (22) Total comprehensive income for the period - - - - (22) - 28 708 28 686 - 28 686 Share-buy back - - - - - - - - - - Revaluation reserve written off - - - (1 498) - - 1 498 - - - Increase of legal reserves - - 206 - - - (206) - - - Other changes - - - - - - 51 51 - 51 Dividends dsitribution - - - - - - (6 800) (6 800) - (6 800) Balance at December 31, 2023 6 800 (1 390) 2 124 90 953 14 13 668 194 938 307 107 - 307 107 Emil Raykov Asya Yordanova Audit Company Marian Nikolov (Executive Director) (Chief Accountant) Primorska Audit Company Ltd. Registered auditor, Reg. N: 086 responsible for the audit Ilia Iliev Reg. N: 0601 Managing partner April 29, 2024 The accompanying notes are an integral part of these consolidated financial statements. CONSOLIDATED STATEMENT OF CHANGES IN EQUITY for the year ended December 31, 2023 _________________ Consolidated financial statements as of December 31, 2023 6 AGRIA GROUP HOLDING AD ____________ Year Year ended ended 31.12.2023 31.12.2022 BGN'000 BGN'000 Cash and cash equivalents at January 1 4 548 1 852 Cash flows from operating activities Proceeds from clients and other debtors 821 418 707 244 Payments to suppliers and other creditors (787 132) (609 954) Payments, related to personnel (28 876) (21 030) Paid / refunded other taxes 6 696 (5 735) Other payments 11 (11) Net cash flows from operating activities 12 117 70 514 Cash flows from investing activities Purchase of property, plant and equipment (28 792) (20 271) Sale of property, plant and equipment 653 1 771 Transactions with financial derivative instruments, net (3 449) 1 182 Payments, related to investments (47 925) (14 904) Net cash flows from investing activities (79 513) (32 222) Cash flows from financing activities Interest bearing bank loans received, paid, net 117 471 (33 566) Trade loans granted and received, net (21 449) 7 807 Payments to lease contracts (6 316) (5 423) Payments related to share buy-back - (1 390) Interests paid (11 831) (3 585) Interests received 319 3 136 Dividends paid (7 127) (2 538) Bank taxes and comissions paid (1 620) (761) Net cash flows from financing activities 69 447 (36 320) Changes in cash and cash equivalents during period 2 051 1 972 Net effect of changes in exchange rates (75) 724 Cash and cash equivalents at period end 6 524 4 548 Emil Raykov Asya Yordanova (Executive Director) (Chief Accountant) Audit Company Marian Nikolov Primorska Audit Company Ltd. Registered auditor, Reg. N: 086 responsible for the audit Ilia Iliev Reg. N: 0601 Managing partner April 29, 2024 The accompanying notes are an integral part of these consolidated financial statements. CONSOLIDATED CASH FLOW STATEMENT for the year ended December 31, 2023 ______________ Consolidated fianancial statements as of December 31, 2023 7 AGRIA GROUP HOLDING AD Consolidated financial statements December 31, 2023 8 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS AT DECEMBER 31, 2023 AGRIA GROUP HOLDING AD Consolidated financial statements as of December 31, 2023 9 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 1. Incorporation and registration. Legal status and legal framework “AGRIA GROUP HOLDING” (the parent company) is registered under Company File 3875 / 2007 of Varna District Court, with a seat and management address in the town of Varna, 111 Kniyaz Boris I Blvd., Business centre, floor 9. The parent company is registered in the Commercial Register at the Registry Agency, UIC 148135254. Effectively 2007 the shares of the parent company are listed for trading at Bulgarian Stock Exchange AD and thus, it has the status of a public company. With a decision of 2007 of the Financial Supervision Commission of Bulgaria the Group was entered in the register of public companies. The main activity of the parent company and its subsidiaries, together called the Group, consists in the production, storage, processing and sale of agricultural products. The parent company has one-tier management system and is managed by a Board of Directors and is represented by an Executive Director. These consolidated financial statements have been approved by the management of the Group on April 29, 2024. 2. Basis of preparation of the consolidated financial statements and accounting principles. 2.1. Applicable general framework for financial statements The annual accounting closing of the books and the preparation of the annual financial statements for 2023 is carried out in accordance with the Accounting Act, which entered into force on January 1, 2016. According to this Law, commercial companies in Bulgaria prepare their financial statements based on the National Accounting Standards adopted by the Council of Ministers (NCS). Certain commercial companies comprehensively listed in the Accounting Law are obliged to prepare their financial statements according to the requirements of the International Accounting Standards, published by the International Accounting Standards Board and adopted for application by the European Union (IAS). Those commercial companies that have adopted and apply IAS under the repealed Accounting Law can continue with their application in the future, or make a one-time transition to National accounting standards (NAS). The Group meets the criteria for an enterprise whose transferable securities are admitted to trading on the regulated market in a member state of the European Union. Therefore, the present consolidated annual financial report has been prepared in accordance with the requirements of the IAS. These are the standards that have been adopted in accordance with Regulation (EC) 1606/2002 of the European Parliament and of the Council of July 19, 2002, for the implementation of International Accounting Standards. As of December 31, 2023, they include the International Accounting Standards, the International Financial Reporting Standards (IFRS), the Interpretations of the Standing Committee on Clarifications and the Interpretations of the Clarifications Committee of IFRS, as well as subsequent amendments and future standards and interpretations. The IAS Council annually reissue the standards and their explanations, which, after formal approval by the European Union, are valid for the year for which they were issued. However, a large part of them are not applicable to the Group’s activities, due to the specific and significantly more complex issues that are treated in them. The management of the Group has complied with all these accounting standards and explanations to them, which are applicable to its activity and have been officially accepted for application by the European Union as of the date of preparation of this consolidated financial statement. AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 10 2.2. New accounting standards and clarifications not yet implemented by the Group The changes in the IAS, which come into force on January 1, 2023, have not had and are not expected to have any significant effect on the applied accounting policy in relation to the annual financial statements prepared by the Group. In addition, the management of the Group does not consider it necessary to disclose in its consolidated annual financial statements the name of those IFRS/IAS and explanations to them, in which changes have been made, formally approved or not yet approved by the European Union, relating to the application them in 2023 and in the future, without them relating to or seriously affecting its business. Such a listing of the names of standards and explanations to them, which do not apply and are not expected to do so in relation to the Group's activities, could lead to misunderstanding and mislead the users of reporting information from this consolidated financial statement. 2.3. Applicable measurement base These consolidated annual financial statements have been prepared in accordance with the historical cost principle, modified in certain cases by the revaluation of certain assets and liabilities to their fair value at the end of the reporting period, insofar as this is required by the relevant accounting standards and this value may be reliably established. Similar deviations from the historical cost principle are disclosed in the disclosure of accounting policy in the relevant places below. All data for the year 2023 and for the year 2022 are presented in thousands of BGN, unless otherwise indicated in the relevant place. The earning er share is calculated and disclosed in BGN. Rounding of the amounts was done on the basis of generally accepted requirements. 2.4. Fair value measurement Some accounting standards allow for the adoption of an approach of initially and subsequently measuring certain assets and liabilities at their fair value. For some financial assets and liabilities, accounting standards require a final measurement at fair value. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an ordinary transaction between market participants at the measurement date. This value should be determined in the main market for the Group, or in the absence of one, the most profitable to which it has access on that date. The fair value of a liability reflects the risk of default. Whenever possible, the Group estimates the fair value of an asset or liability using stock market prices in the active market in which it is quoted. A market is considered active if transactions for that asset or liability occur with sufficient frequency and volume so that continuous price information is provided. If there is no quoted price in an active market, the Group uses valuation techniques, maximizing the use of relevant observable inputs and minimizing the use of unobservables. The chosen valuation technique covers all factors that market participants would consider in pricing the transaction. The concept of fair value implies realization of the financial instruments through sale. In most cases, however, particularly with respect to current trade receivables and payables, as well as loans received, the Group expects to realize these financial assets and liabilities through their full repayment or repayment over time. They are therefore presented at their nominal or depreciable value. A large part of the financial assets and liabilities are short-term in nature; therefore, their fair value is approximately equal to the carrying amount. The fair values are being categorized in various levels in the Fair Values Hierarchy based on input data in the valuation techniques, as follows: • Level 1: Quoted prices (non-adjusted) on active markets for similar assets or liabilities. • Level 2: Input data other than quoted prices included in Level 1, which directly (i.e. as prices) or indirectly (i e. obtained through prices), are accessible for asset or liability monitoring purposes. • Level 3: Input data about the asset or liability, which are not based on observable market data (non- observable input data). AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 11 2.4. Fair value measurement (continued) If the input data used for measuring the fair value of an asset or liability may be categorized in different levels in the fair values hierarchy, then the assessment of the fair value is categorized in its entirety at that same level of the fair values hierarchy which input information is of significance for the overall assessment. The Group recognizes transfers between levels of the fair value hierarchy at the end of the reporting period in which the change occurred. More information on the assumptions made in estimating fair values is included in the relevant notes. The management of the Group considers that, under the existing circumstances, the estimates of financial assets and liabilities presented in the individual statement of financial position are as reliable, adequate and credible as possible for the purposes of financial reporting. 2.5. Consolidation The consolidated annual financial statement of a Group includes the individual financial statement of the parent company and the financial statements of the subsidiaries prepared as of December 31, 2023. All assets, liabilities, capital, income, expenses and cash flows of the companies in the Group are presented as belonging to a single entity. Subsidiaries are those that are controlled by the parent company. Control occurrs when the parent exercise rights to variable returns from its interest in the subsidiary and has the ability to influence those returns through its power. The consolidated financial statement has been prepared applying the same accounting policy in relation to the same transactions and economic facts of all companies in the Group. All mutual equity interests, as well as material internal transactions, balances and unrealized profits within the group have been eliminated and the financial statements have been prepared using the full consolidation method. The results of operations of subsidiaries are included in the consolidated financial statement from the day control is acquired over them and cease to be consolidated from the date this control is lost. When a subsidiary is acquired as a result of an internal group restructuring, the net assets and its financial result are included from the beginning of the earliest reporting period presented in the consolidated financial statements. 2.6. Subsidiaries As of December 31, 2023 and 2022 the parent company has direct ownership interests in the following subsidiaries which are included in the consolidated financial statements: Company Share of capital % Share of capital % December 31,2023 December 31,2022 BGN’000 BGN’000 Agra EAD 100 % 100 % AgriaVia Oil EOOD 100 % 100 % Agro EOOD 100 % 100 % Almagest EOOD 100 % - Aris Agro EOOD 100 % 100 % BD Agri EOOD 100 % 100 % BD Pharm EOOD 100 % 100 % Bora Energy EOOD 100 % 100 % AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 12 2.6. Subsidiaries (continued) Company Share of capital % Share of capital % December 31,2023 December 31,2022 BGN’000 BGN’000 Bora Invest EOOD 100 % 100 % Grover EOOD 100 % 100 % Diasvet EOOD 100 % 100 % AG Property Invest EOOD 100 % 100 % Elit -86 EOOD 100 % 100 % Kehlibar EOOD 100 % 100 % Korn Trade EOOD 100 % 100 % Kristera Agro EOOD 100 % 100 % Solk Gas BG EOOD 100 % 100 % Tera Protect EOOD 100 % 100 % Toni M EOOD 100 % 100 % Kristera AD 99.00 % 99.00 % Korn Star EOOD 70.00% 70.00 % On February 8, 2023, "Agria Group Holding” AD entered a final contract for the purchase and sale of 441,866 ordinary registered non-voting shares from the share capital of the trading company "Almagest" AD, with a nominal value of BGN 80 each, representing 100 % of the capital of "Almagest" AD. On this date, the shares were transferred from the sellers to the buyer through the registration of the transfer transaction in the Central Depository AD, in accordance with the requirements of the current legislation, and "Agria Group Holding" AD acquired the ownership right to 100% of the shares from the capital of " Almagest" AD. The shares have been transferred to the buyer "Agria Group Holding" AD without any obligations, encumbrances, rights, and claims of third parties, together with all rights arising from or related to them. In March 2023, a change in the ownership structure of the subsidiary Silk Gas BG OOD was reflected in the Commercial Register at the Registration Agency. According to the announced in the Trade register, on February 24, 2023, a contract for the sale of company shares was concluded, under which Agria Group Holding AD acquired the remaining 225 shares of the capital of this company. Thus, Silk Gas BG is a sole proprietorship limited liability company (EOOD), with the sole owner of the share capital being Agria Group Holding AD. 2.7. Associated companies Associates are those companies in which the Group exercises significant influence, but not control, over the financial and operational activities. Associates are accounted for and presented in the consolidated financial statements using the equity method (one-line consolidation). As of December 31, 2023, and 2022, the Group includes the following associated companies: AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 13 2.7. Associated companies (continued) Company Share of capital % Share of capital % December 31,2023 December 31,2022 BGN’000 BGN’000 AB Investment Group AD 50.00 % 50.00 % Agro Oil Consult OOD 50.00 % 50.00 % Energy Solar Technologies AD 33.33 % 33.33 % 2.8. Minority interest Minority interest is that part of the net assets and net financial result for the period of the relevant subsidiary which is not directly or indirectly owned by the group. As of December 31, 2023, all subsidiaries are directly or indirectly 100% owned by the Group, therefore no minority participation is presented in this consolidated financial statement. 2.9. Business combinations. Company transformation According to the requirements of IFRS 3 Business Combinations, a business combination is a combination of individual companies or businesses into a single reporting entity. In the event that a company acquires control of another company that is not a separate business, the merger of these companies is not considered a business combination. Business combinations are accounted for using the purchase method in accordance with applicable standards. When in reporting periods after the acquisition of control of the subsidiary additional shares are purchased, the increase in investment is accounted for using the purchase method and the difference between the acquisition price and the share in the acquired identifiable assets, liabilities and contingent liabilities is recorded as goodwill, which is immediately reviewed for indicators of impairment. Where such indicators exist, the goodwill is impaired. Transformations of commercial entities which are carried out under the Bulgarian Commerce Act and relate to entities under common control are treated as restructuring within a business group. A merger of a company is not associated with cash and/or other payments and is presented in the statement of financial position of the receiving company or group at the historical cost of the identifiable assets, liabilities, and equity, which are consolidated line by line. Comparative data are restated as if the transformation is carried out at the beginning of the earliest comparative period. 2.10. Comparative figures Under the Bulgarian accountancy legislation and IAS, the financial year ends on 31 December and companies are required to submit annual financial statements as at that date, together with comparative data as at this date the prior year. Where the group has made changes to its accounting policies which have been applied retrospectively and/or have adjusted and/or reclassifications of certain items, it presents comparative data for the two prior reporting periods in the consolidated statement of financial position and its accompanying notes as follows: - at the end of the prior reporting period; - at the beginning of the earliest comparative period. AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 14 2.10. Comparative figures (continued) In other items of the consolidated financial statements and the accompanying notes, comparative data is presented only as at the end of the prior reporting period. 2.11. Accounting assumptions and accounting estimates The application of the IAS requires the company's management to make certain accounting assumptions and approximate accounting judgments when preparing the consolidated annual financial statements and when determining the value of some of the assets, liabilities, income, expenses and contingent assets and liabilities. Changes in accounting estimates already made are reflected in the period in which they became known, as well as in future accounting periods, if they relate to them. All accounting estimates and assumptions have been made based on management's best judgment as of the date of preparation of the financial statements. Actual results could differ from those presented in these consolidated financial statements. 2.12. Functional and presentation currency of the financial statements The functional currency of the Group is the currency in which transactions are mainly carried out in the country in which it is registered. This is the Bulgarian lev (BGN), which according to local legislation has a fixed exchange rate to the euro, in the ratio of EUR 1= BGN 1.95583. The Bulgarian National Bank (BNB) determines the exchange rates of the Bulgarian lev to other foreign currencies, using the exchange rate of the euro to the corresponding currency on international markets. On initial recognition, each foreign currency transaction is recorded in the functional currency, applying the exchange rate at the time of the transaction or event to the foreign currency amount. Cash, receivables or liabilities denominated in a foreign currency are reported in the functional currency, applying the exchange rate published by the BNB for each business day. As of December 31, they are valued in Bulgarian lev using the closing exchange rate of the BNB. The effects of exchange rate differences relating to the settlement of foreign currency transactions, or the reporting of foreign currency transactions at rates different from those at which they were originally recognized, are included in the statement of profit or loss and other comprehensive income, in the period of their occurrence. The final exchange rate of the Bulgarian lev to the main currencies with which the Group operates for the periods for which the present consolidated financial statements are prepared is as follows: December 31, 2022: 1 USD = BGN 1.83371 December 31, 2023: 1 USD = BGN 1,76998 The presentation currency in this consolidated financial statement is also the BGN. 2.13. Financial risk management Financial risk factors In the course of its usual activity, the Group may be exposed to various financial risks. Market risk is the risk that the fair value or future cash flows of a financial instrument will vary due to changes in market prices. Market risk includes currency risk, interest rate risk and price risk. Credit risk is that one party to a financial instrument will cause a risk of financial loss to the other party if the agreed payment is not met. Liquidity risk is the risk that the Group could have difficulties meeting its obligations under financial liabilities. The Board of Directors is responsible for identifying and managing the risks faced by the Group. The Group's risk management policy is developed to identify and analyze the risks it faces, establish risk-taking limits and controls, monitor risks and compliance with established limits. These policies are subject to periodic review in order to reflect changes in market conditions and in the Group's activities. Through its training and management AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 15 2.13. Financial risk management (continued) standards and procedures, the Group aims to develop a constructive control environment in which all employees understand their role and responsibilities. 2.13.1. Currency risk The Group trades in a currency other than its functional currency, which is why it is exposed to risk related to possible changes in exchange rates. Such risk arises mainly from changes in the US dollar exchange rate, as the Group makes purchases denominated in US dollars. Transactions in euros do not expose the group to currency risk, as since January 1,1999 BGN has been pegged to this currency. The sensitivity analysis to foreign exchange risk shows that the financial results of the Group would not change significantly due to changes in the exchange rate, as the group does not have significant foreign exchange risk exposures. 2.13.2. Interest rate risk The financial instruments that potentially expose the Group to interest rate risk are primarily bank loans. The group uses bank loans, the interest rates of which are variable according to the general economic and financial conditions. As for most loans, the agreed interest rate is at a fixed premium above EURIBOR / Average Deposit Index, the Group is potentially exposed to cash flow risk. Management performs periodic analyzes of the macroeconomic environment and assesses the future interest rate risks faced by the Group. In the event of a deterioration in general interest rates, the Group has the option of using hedging instruments. The management of the Group does not consider that there are currently conditions for a significant negative change in the agreed total price of the borrowed credit resource, which would lead to additional financial risks because of the credits used as of December 31, 2023. 2.13.3. Credit risk In carrying out its activities, the Group is exposed to credit risk related to the fact that one of the counterparties will not be able to fulfill its obligations in full and within the usual deadlines. The financial assets of the Group are concentrated in two groups - cash and receivables. Cash in the Group and payment operations are concentrated in commercial banks with stable liquidity, which limits the risk regarding cash and cash equivalents. Receivables from clients Financial assets that potentially expose the Group to credit risk are primarily trade receivables and interest- bearing loans granted. Exposure to credit risk is a result of the individual characteristics of individual customers. This exposure may also depend on non-payment risk, which is a risk inherent in each business sector or the domestic market in which the Group operates. The Group is primarily exposed to credit risk if customers default on their obligations. The Group's policy in this area is aimed at making sales to customers with appropriate credit standing and the use of adequate collateral as a means of limiting the risk of financial losses. The credit quality of customers is evaluated by considering financial status, past experience and other factors. Credit limits have been introduced, compliance with which is monitored regularly. AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 16 2.13. Financial risk management (continued) 2.13.4. Price risk The group is exposed to price risk, since the prices of the services and materials used are influenced by those on international markets. The policy in this area is aimed at negotiating fixed prices with the providers of basic services, with a prevailing term of up to a year, in order to avoid the negative effect of a possible rise in price levels during this period. 2.13.5. Liquiity risk Liquidity risk is the risk that the Group will not be able to meet its financial obligations when they become due. The policy in this area is aimed at ensuring the availability of sufficient liquid funds to service obligations when they become due, including in extraordinary and unforeseen situations. The Group's management maintains sufficient free cash to ensure constant liquidity and repayment of the Group's obligations within the terms agreed with the suppliers and other creditors. The Group monitors the level of expected cash inflows from trade and other receivables, together with expected cash outflows to trade and other payables. 3. Definition and measurement of items of the financial statements 3.1. Property, plant and equipment and intangible assets Property, plant and equipment and intangible assets, excluding agricultural land, are presented in the consolidated statement of financial position at cost (acquisition cost) and reduced by the amount of amortization and any impairment. The agricultural land owned by the group is stated at a revalued amount, which is determined as their fair value at the reporting date, less any impairment losses. Independent licensed appraisers who are appropriately qualified for such appraisals are used to determine fair value. A revaluation reserve was formed from the performed revaluations, presented as part of the capital. The revaluation reserve is recognized as retained earnings after the respective asset is written off. Assets with right of use Property, plant and equipment that are leased by the Group under lease agreements are presented in the consolidated statement of financial position separately from those that are owned by the Group. An exception is made for those assets that are leased for a period not longer than one year, as well as for those with an initial value of up to BGN 10,000, which are not presented in the consolidated statement of the Groups’ s financial condition. The rent due for them is charged as a current expense for the period of their use. Upon initial recognition, right-of-use assets are valued at acquisition cost. In the consolidated statement of financial position as of December 31, 2023, right-of-use assets are valued at initial value, less accrued depreciation and any impairment. Their amortization is carried out in the same way as own assets with a similar purpose are amortized, but taking into account the term of the relevant lease agreement. Interest expense is recognized as current in the consolidated statement of comprehensive income under an amortization plan. 3.1.1. Initial acquisition On initial acquisition, property, plant and equipment and intangible assets are valued at cost, which includes the purchase price, customs duties and all other direct costs necessary to bring the asset into working order. Direct AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 17 3.1. Property, plant and equipment and intangible assets (continued) costs are mainly: site preparation costs, initial delivery and handling costs, installation costs, costs for fees of persons related to the project, non-refundable taxes, etc. The group has determined a value threshold of BGN 700 (seven hundred BGN), below which the acquired assets, regardless of the fact that they have the characteristics of a non-current asset, are recorded as a current expense at the time of their acquisition. Property, plant and equipment received through government grants are valued at fair value at the date of acquisition. 3.1.2. Subsequent costs and depreciation Repair and maintenance costs are recognized as current expenses when incurred. Subsequent expenses incurred in relation to property, plant and equipment that have the nature of replacement of certain components, significant parts and aggregates, or improvements and restructuring, and meet the requirements for asset recognition are capitalized in the carrying amount of the respective asset and its residual useful life is reviewed as at the capitalization date. At the same time, the non-depreciated amount of the components replaced is derecognised from the carrying amount of the assets and is recognised as current expenses for the period of restructure. Depreciation of property, plant and equipment and intangible assets is calculated by systematically applying the straight-line depreciation method. Depreciation rates are determined by the management of the group based on their estimated useful life. Depreciation is not charged on land, fully depreciated assets and those in the process of acquisition, as well as on assets classified as held for sale in accordance with the requirements of IFRS 5 Non-current assets held for sale and discontinued operations. The following rates in years of useful life have been applied by groups of assets: Group of assets; 2023 2022 Administrative and commercial buildings 25, 50 25 Machinery and equipment 3,33- 10 3,33- 10 Transport vehicles 4-10 4 Computers, peripherals, software 2 2 Office equipment 5,6;6,67 6,67 Other tangible fixed assets 6,67 6,67 Intangible assets 2;6,67 6,67 3.2. Impairment of property, plant and equipment and intangible The carrying amounts of assets are reviewed at each year end to determine whether there is any indication of impairment. If any such indication exists, the group estimates the recoverable amount of the asset to determine the amount of impairment loss Where it is not possible to estimate the recoverable amount of an asset, the group estimates the recoverable amount of the cash-generating unit to which the class of assets belong. If the recoverable amount of an asset (or a cash generating unit) is lower than it carrying amount, the carrying amount shall be reduced to the recoverable amount of the asset (or a cash generating unit). AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 18 3.2. Impairment of property, plant and equipment and intangible (continued) Impairment loss is recognized as an expense in the statement of profit or loss and other comprehensive income when incurred. Where an impairment loss subsequently reverses, the carrying amount of the asset (cash- generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognized for the asset (cash-generating unit) in prior years. A reversal of an impairment loss is recognized as income in the statement of profit or loss and other comprehensive income when incurred, unless the relevant asset is carried at revalued amount, in which case the reversal of the impairment loss is treated as an increase in the revaluation reserve. 3.3. Goodwill When acquiring a subsidiary (enterprise) from the Group in business combinations, the acquisition (purchase- sale) method is used. Any excess of the sum of the consideration transferred (measured at fair value), the amount of the non-controlling interest in the acquiree and, in the case of a staged acquisition, the acquisition date fair value of the previously held equity interest in the acquiree, over the identifiable assets acquired and assumed liabilities of the acquiring company, is treated and recognized as goodwill. In the consolidated financial statement, it is initially valued at acquisition cost (cost), and subsequently at acquisition cost minus accumulated impairment losses. Reputation is not amortized. The goodwill arising from the acquisition of a subsidiary is presented in the consolidated statement of financial position to the group of "intangible assets", and that arising from the acquisition of joint and associated companies (enterprises) is included in the total value of the investment and is indicated in the group of "investments in joint ventures" or respectively in "investments in associated enterprises". If the acquiring company's share of the fair value of the net identifiable assets acquired exceeds the acquisition price of the business combination, this excess is recognized immediately in the consolidated income statement of the Group in the item "gains/(losses) from acquisition of/(sell of) subsidiaries". The goodwill on the acquisition of joint and associated companies (enterprises) is tested as part of the total value of the investment. Self-recognized goodwill on the acquisition of subsidiaries (enterprises) is mandatorily tested for impairment at least once a year. Goodwill impairment losses are not subsequently recoverable. Profits or losses from the sale (exemption) of a given subsidiary (enterprise) from the Group also include the book value of the goodwill deducted for the sold (exempted) company (enterprise). Each recognized goodwill is assigned to a cash-generating entity upon the realization of a business combination, and this entity is applied when performing the impairment tests. When determining the objects generating cash flows, the objects from which future economic benefits were expected during the acquisition in the business combination and on the occasion of which the goodwill itself arose are taken into account. 3.4. Investments in associates Non-current investments, representing shares and stakes in associates, are presented in the consolidated financial statements at cost, which is the fair value of the consideration paid, including direct costs of acquisition, less accumulated impairment losses. Investments in associates held by the group are subject to annual review for impairment. If conditions for impairment appear, it is recognized in the consolidated statement of profit or loss and other comprehensive income (in the profit or loss for the year). Upon purchase and sale of investments in associated, the entity applies the “closing date “of the transaction. Investments are derecognized when the rights deriving from them are transferred to other parties when the legal grounds for that occurred and thus the control over the economic benefits from the respective investments are considered lost. Profit/(loss) from the selling of such investments is presented respectively as “financial income “or “financial expenses” in the consolidated statement of profit or loss and other comprehensive income (in the profit or loss for the year). AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 19 3.5. Inventories Inventories on their acquisition are valued at acquisition cost, which includes all direct costs related to the delivery of the asset. Finished goods produced are valued at cost, including basic production costs. Work in progress is valued at the cost of basic production costs. The consumption assessment of one part of inventories is performed using the weighted average price method, and the other part-using the first-in-first-out method. At the end of the year, inventories are valued at the lower of the acquisition price (cost) and their net realizable value, which is defined as the expected selling price in the course of carrying out the activity, less the expected costs of the sale. 3.6. Financial instruments A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity. The financial assets and financial liabilities are recognized in the statement of financial position when the entity becomes a party in the contractual relationship of the respective financial instrument generating this asset or liability. Financial assets are de-recognized from the statement of financial position after the contractual rights for receiving monetary flows have expired or the assets have been transferred and their transfer satisfies the requirements for derecognition in accordance with IFRS 9 Financial instruments. Financial instruments Financial liabilities are derecognised from the statement of financial position when and only when they are repaid – i.e. the obligation specified in the contract has lapsed, been canceled or its term has expired. The Group's activity does not imply the presence of various financial instruments. The main financial instruments included in the group's statement of financial position are presented below. 3.6.1. Trade and other receivables Trade receivables are amounts due from customers for goods and services sold in the ordinary course of business. They are usually due for short-term settlement and are therefore classified as current. Trade receivables are initially recognized in the amount of unconditional remuneration due, unless they contain significant financing components. The Group holds trade receivables with the aim of collecting the contractual cashflows and therefore measures those at amortized cost using the effective interest method. Discounting is not performed in cases where its effect is insignificant. As at the date of preparing the financial statements, the Group assesses whether there is objective evidence for impairment with regard to the trade receivables, which are of individual significance. Impairment is being reported in case there is objective evidence that the company will not be able to collect all amounts, in accordance with the initial conditions, pertaining to the respective receivable. The amount of the impairment is the difference between the balance sheet value and the recoverable amount. The latter is the current value of the anticipated cashflows less the effective interest rate. The amount of the impairment of trade receivables during the current period is reported as income and expense. When a receivable is expected to be collected within a year, it is reported as a current asset. In all other cases, receivables are reported as non-current assets. AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 20 3.6. Financial instruments (continued) 3.6.1. Trade and other receivables (continued) Future cashflows determined for a group of financial assets, which are collectively measured for impairment, are determined on the basis of historical information pertaining to financial assets with credit risk features similar to the features of the group of financial assets. Assets for which individual impairment is applied are not included in an impairment group. The Group uses a simplified approach when reporting impairments of trade and other receivables and recognizes impairment losses as expected credit losses for the entire period. These represent the expected shortage of contractual cashflows, while considering the probability for non-performance at any moment of the financial instrument’s tenor. Significant financial difficulties of the liable person/entity, a probability for declaring it insolvent and in liquidation, financial restructuring, or impossibility for repayment of the debt (more than 30 days) are being regarded as an indicator that the trade receivable should be impaired. Upon measuring the anticipated credit losses under trade receivables, the Group has used a provision matrix, as well as its expertise in the field of credit losses under trade receivables and receivables from provided loans, to measure as estimates the expected credit losses over the financial assets’ entire tenor. The essential part of contracts with clients, as well as receivables under provided loans are concluded with trade companies, which are related parties, as a result of which the management assesses the probability of occurrence of credit losses as low. The performed analysis proves this assessment and as a result, no accrual of provisions for eventual credit losses is needed after the introduction of the new IFRS 9. 3.6.2. Cash and cash equivalents Cash and cash equivalents in BGN are stated at nominal value and cash denominated in foreign currency – at the closing exchange rate of BNB as of December 31 of the relevant year. For the purposes of preparing the cash flow statement, cash and cash equivalents are presented as non-restricted cash in hand and at banks. 3.6.3. Interest bearing loans Interest-bearing loans are recognized initially at fair value, formed by the cash proceeds received, less the inherent costs of the transaction. After their initial recognition, interest-bearing loans are measured at amortized cost, with any difference between the initial cost and the maturity value being recognized in profit or loss over the period of use of the loan based on the effective interest method. Interest-bearing loans received, in the event of which no costs related to the transaction were incurred, are not amortized. Received bank overdrafts are treated in the same way, where the recipient has the right to repeatedly absorb or repay the loan within the pre- agreed limit. Finance costs, including direct borrowing costs, are included in profit or loss using the effective interest rate method, with the exception of transaction costs on bank overdrafts, which are recognized in profit or loss on a straight-line basis for the period, for which the overdraft was agreed upon. Interest-bearing loans are classified as current when they should be settled within twelve months from the end of the reporting period. AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 21 3.6. Financial instruments (continued) 3.6.4. Payables to suppliers, other non-current payables and received advances Trade and other liabilities arise because of the received goods or services. No amortisation applies to short-term payables. Trade payables are recognized initially at fair value, while subsequently at amortized cost, using the effective interest rate method. 3.7. Share capital The share capital of the Group constitutes the parent company’s share capital as it is presented at nominal value and corresponds to its current legal registration. 3.8. Reserves The financial results capitalized from previous years, the reserves from premiums related to the issuance of shares, legal reserves, reserves from the revaluation of agricultural land and some of the buildings owned by the Group, as well as reserves from revaluation of defined income are presented as reserves in the consolidated statement of the financial position of the Group. The shareholders of the Group can dispose of the capital reserves after a decision of the General meeting. Revaluation reserves are recognized as realized through their transfer to retained earnings after the retirement of the relevant asset or settlement of long-term liabilities to personnel. 3.9. Government grants Government grants for non-current assets and those to cover the costs incurred by the group are recognized as deferred income when there is reasonable certainty that they will be received and that the group will be able to meet all related requirements. Income from government grants for non-current assets is recognized in the statement of profit or loss and other comprehensive income on a systematic basis over the useful life of the asset. Government grants received as compensation for expenses incurred by the group are recognized in the statement of profit or loss and other comprehensive income in the period in which the costs associated with the grant were incurred. 3.10. Leases On the effective date of the contract, the Group assesses whether the contract represents or contains a lease. Namely, whether the contract transfers the right to control the use of the identified asset for a certain period of time. The Group as a lesee The Group applies a single approach to the recognition and measurement of all leases, except for short-term leases (ie leases with a lease term of up to 12 months) and leases of low-value assets. The Group recognizes lease liabilities for the payment of lease payments and rights of use that represent the right to use the assets. Right-of-use assets The Group recognizes rights of use from the commencement date of the lease (ie the date on which the underlying AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 22 3.10. Leases (continued) asset is available for use). Assets with a right of use are measured at cost less accumulated depreciation and impairment losses and adjusted for any revaluation of lease obligations. The acquisition price of the right-of-use assets includes the sum of the lease liabilities recognized, the initial direct costs incurred and the lease payments made on or before the lease commencement date, an estimate of the costs that will be incurred by the lessee in dismantling and moving the the asset, restoring the site on which it is located or restoring the asse If, at the end of the lease term, ownership of the leased asset is transferred to the group, or the acquisition price reflects the exercise of a purchase option, depreciation is calculated using the expected useful life of the asset.t to the condition required under the terms of the lease, less any lease incentives received. Right-of-use assets are depreciated on a straight-line basis over the term of the lease. Lease obligations From the starting date of the lease, the Group recognizes lease liabilities measured at the present value of the lease payments that will be made over the lease term. Lease payments include flat-rate installments (including flat-rate payments) less any eligible lease incentives, variable lease payments that depend on an index or interest rate, and amounts that are expected to be paid under guarantees for residual value. Lease payments also include the cost of exercising a call option that is reasonably certain that it will be exercised by the group, as well as penalties for terminating the lease if the lease term reflects the group's exercise of the lease option termination. Variable lease payments that do not depend on an index or interest rate are recognized as an expense in the period in which the event or condition that triggers the payment occurs. In calculating the present value of lease payments, the Group uses an intrinsic interest rate on loans at the commencement date of the lease, as the interest rate set in the lease cannot be reliably determined. After the commencement date, the amount of the lease obligations increases with the interest and decreases with the lease payments madeIn addition, the carrying amount of leased liabilities is revalued if there is a modification, change in lease term, change in lease payments (for example, changes in future payments as a result of a change in the index or interest rate used to determine those lease payments). or a change in the valuation of the option to purchase the underlying asset. Short - term leases and leases of low - value assets The Group applies the exemption from recognition of short-term leases in respect of its short-term leases of buildings and vehicles (for example, leases with a lease term of 12 months or less from the starting date and which do not contain a purchase option). The Group also applies the exemption from recognizing leases of low-value assets to leases of office equipment that is considered to be of low value. Lease payments on short-term leases and leases of low-value assets are stated as an expense on a straight-line basis over the term of the lease. 3.11. Employee benefits 3.11.1. Defined contribution plans The Government of Bulgaria is responsible for providing pensions under defined contribution plans. The expenses related to the group’ s obligation to make contributions under the defined contribution plans are recognized in the statement of profit or loss and other comprehensive income as they incur. AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 23 3.11. Employee benefits (continued) 3.11.2. Annual paid leave The Group recognizes the undiscounted amount of the estimated costs related to annual leave expected to be paid to employees in return for their service for the past reporting period. 3.11.3. Defined retirement plans Pursuant to the requirements of the Labour Code, upon termination of the employment contract the employees are entitled to retirement benefits amounting to two gross monthly salaries when the overall length of service of the employee in the group is less than 10 years, or six gross monthly salaries, when the overall length of service is more than 10 consecutive years. The Group recognizes as current expenses the discounted amount of the accrued employee retirement benefit payables, and current interest expense based on a valuation of a certified actuary. Valuations of long-term employee benefit obligations are carried out under the projected unit credit method and this assessment as at the date of statement of financial position shall be made by certified actuaries. The amount recognized in the statement of financial position represents the present value of the obligation and in the current period the effect of any liabilities to employees that refer to it was considered, and the effect of past years was reported in the periods to which it relates. 3.12. Income and expenses recognition 3.12.1. Income from sales of services and other income Income from sales and business expenses are accrued when incurred regardless of cash proceeds and payments. The reporting and recognition of income and expenses is performed in compliance with the requirements for a cause-and-effect relationship between them. Income is measured at the fair value of the consideration received or due to be received, less the amount of all granted discounts. The Group recognizes income, when the income amount can be reliably measured, in the cases when the Group can obtain future economic benefits, and also when it meets particular criteria for each activity of the Group, as specified further below. The amounts collected on behalf of third parties, such as sales taxes like the value added tax (VAT), are excluded from income. (a) Income from sales of goods and production Income from sales of goods and production are recognized when: • The significant risks and rewards of ownership of the goods or products are transferred to the buyer; • The Group has not retained continuing managerial involvement or effective control over the goods (products) sold; • It is likely that the company will receive economic benefits as a result of the transaction; • Income and expenses directly related to the transaction can be reliably measured. AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 24 3.12. Income and expenses recognition (continued) 3.12.1. Income from sales of services and other income (continued) (b) Income from rent of agricultural land and other assets Income from rents of assets is recognized for the reporting period for which the agricultural land or the other asset is rented. (c) Income from sales of services Income from sales of services (administrative and other) is recognized on monthly basis for the reporting period to which refers. Income from government grants, related to compensation of incurred expenses is recognized in current profits or losses on a systematic basis for the same period during which expenses are recognized. Income from government grants , related to compensation for investment expenses for the acquisition of an asset are recognized in the current profit or loss on a systematic basis for the entire period of the asset’s useful life, usually in the amount of the amortization recognized as expense. Profit (loss) from sales of property, plant and equipment, intangbible assets and inventories are rcognized as other income (expenses). In case of an exchange of assets , income (expense) is being reported from the exchange transaction in the amount of the difference between the fair value of the received asset and the carrying amount of the exchanged asset. When economic benefits are expected to arise over several financial periods and their relatedness to the income may be defined only in general or indirectly, expenses are recognised in the profit or loss based on procedures for systematic and rational allocation. 3.12.2. Financial income and expenses Borrowing costs that are directly attributable to an asset for which the acquisition, construction or production process necessarily takes a significant amount of time before it is ready for its intended use or sale should be capitalized as part of the cost of the asset. this asset. All other financial income and expense are recognized in profit or loss for all instruments measured at amortized cost using the effective interest method. The effective interest method is a method of calculating the amortised cost of a financial asset or liability and for allocating the profit or cost for interest rates during the respective period. The effective interest method is that where expected future cash payments or income are discounted during the life of the financial instrument or in certain cases for a shorter period, from the carrying amount of the financial asset or liability. During the calculation of the effective interest rate, the Group assesses the cash flows by taking into account all contractual conditions of the financial instrument, however, without including potential future credit losses resulting from impairment. The calculation includes fees, transaction costs, premiums or discounts paid or received between the parties to the contract, which are an integral part of the effective interest rate. All other financial income and expenses are reported through profit or loss for all instruments, measured at amortized cost using the effective interest rate method. AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 25 3.13. Income tax expense According to the Bulgarian tax legislation for the years 2023 and 2022, commercial companies owe corporate tax (profit tax), which is determined at the rate of 10% of the taxable (taxable) profit. The tax rate for 2024 remains at 10%. The application of the profit with current tax is carried out on the basis of the financial results of the individual subsidiaries that are included in the consolidation and according to the requirements of the tax legislation in Bulgaria, no adjustments are made in connection with the preparation and consolidated financial statements of the groups. Registered agricultural producers are given up to 60% of the corporate tax due for investment and fulfillment of certain conditions. Income tax expense represents the sum of current income tax and the tax effect on temporary tax differences. The current income tax is determined on the basis of the taxable (taxable) profit for the period, applying the tax rate according to the tax legislation at the date of the financial statement. Deferred tax assets and/or liabilities are the amounts of recoverable and payable income taxes for future periods in respect of deductible and taxable temporary tax differences. Temporary tax differences are established by comparing the carrying amount of an asset or liability presented in the statement of financial position and its tax base obtained by applying the tax rules. Deferred income taxes are calculated using the liability balance method. Deferred tax liabilities are calculated and recognized for all taxable temporary differences, while deferred tax assets are recognized only if it is probable that they will reverse and if the group will be able to generate sufficient profit in the future from which they can be deducted. The effect of recognizing deferred tax assets and/or liabilities is reflected where the effect of the event itself that gave rise to them is presented. For events that affect the statement of profit or loss and other comprehensive income, the effect of deferred tax assets and liabilities is also recognized in the statement of profit or loss and other comprehensive income. For events that are initially recognized in equity (revaluation reserve) and deferred tax assets and liabilities are recognized against equity. Deferred tax assets and/or liabilities are offset in the consolidated financial statements when the income taxes are levied by the same tax authority. 3.14. Critical estimates for the application of the Group’s accounting policy. Key estimates and assumptions with high uncertainty. In the process of applying the accounting policy, the Group’s management makes estimates, which impact significantly these consolidated financial statements. Such estimates by definition are rarely equal to the actual results. As a result of their nature, they are subject to constant review and update, and they summarize the historical experience and other factors, including expectations about future events, which the management deems reasonable under the current circumstances. The estimates and assumptions entailing significant risk of material adjustment in the carrying amounts of assets and liabilities during the next financial year are stated further below. 3.14.1. Revaluation of property, plant and equipment Management has adopted a policy of appointing and using the professional services of independent licensed appraisers to determine the fair values of agricultural lands that are valued at fair value. The following approaches and valuation methods for measuring the fair value of different types of property, plant and equipment have been applied in this valuation: AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 26 3.14. Critical estimates for the application of the Group’s accounting policy. Key estimates and assumptions with high uncertainty (continued) 3.14.1. Revaluation of property, plant and equipment (continued) • Comparative market method – derives an indicative value by comparing the asset subject to valuation with identical or similar assets for which price information is available, which is accepted with greater weight due to the nature of the properties and their current use; • Income approach – derives indictive value by presenting future cashflows to a single current capital amount. For application of this approach, it is necessary to determine the permanent generarated net annual income of the real estate (land rent), which is capitalized to present the net current value. Such revaluations should be made frequently enough in the cases when there are indications that the fair value of a certain asset class has changed considerably. 3.14.2. Retirement benefit obligations Retirement benefit obligation is determined by actuarial valuation. This valuation requires assumptions to be made about the discount rate, future wages growth, staff turnover and mortality rates. Due to the long-term nature of staff income at retirement, these assumptions are subject to significant uncertainty. 3.14.3. Useful life of property, plant and equipment and intangible assets The financial reporting of property, plant and equipment and intangible assets includes the use of estimates of their expected useful lives and transfer values, which are based on judgments by the management of the Group. 3.14.4. Impairment of accounts receivable The management estimates the amount and period of expected future cash flows associated with receivables based on experience with current circumstances in the following groups: individual accounts, households and other retail and receivables. Due to the inherent uncertainty of this assessment, actual results may differ from those expected. The Group's management reviews the estimates from previous years and the actual results from the previous year. 3.15. Determining fair values Some of the accounting policies and disclosures of the Group require an assessment of fair values for financial and non-financial assets and liabilities. When estimating the fair value of an asset or liability, the Group uses observable data, insofar as possible. The fair values are being categorized in various levels in the Fair Values Hierarchy based on input data in the valuation techniques, as follows: • Level 1: Quoted prices (non-adjusted) on active markets for similar assets or liabilities. • Level 2: Input data other than quoted prices included in Level 1, which directly (i.e. as prices) or indirectly (i e. obtained through prices), are accessible for asset or liability monitoring purposes. • Level 3: Input data about the asset or liability, which are not based on observable market data (non- observable input data). AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 27 3.15. Determining fair values (continued) If the input data used for measuring the fair value of an asset or liability may be categorized in different levels in the fair values hierarchy, then the assessment of the fair value is categorized in its entirety at that same level of the fair values hierarchy which input information is of significance for the overall assessment. The Group recognizes transfers between the levels of the fair values hierarchy as at the end of the reporting period, during which the change has occurred. More information about the assumptions made based on the assessment of the fair values is included in the respective appendices. 4. Property, plant and equipment Land Buildings Machinery and equipment Transport vehicles Right-of- use assets Construction in progress Rented assets improvements Total BGN’000 BGN’000 BGN’000 BGN’000 BGN’000 BGN’000 BGN’000 BGN’000 Cost: Balance as of January 1,2022 125 679 38 790 39 035 17 085 20 116 3 227 - 243 932 Additions 2 955 61 7 041 6 632 5 680 19 542 1 494 43 405 Additions from new subsidiaries 240 37 162 - - - 439 Disposals (450) (64) (185) (2 285) (7 373) (6 807) - (17 164) Revaluation 47 355 - - - - - - 47 355 Balance as of December 31,2022 175 539 39 027 45 928 21 594 18 423 15 962 1 494 317 967 Additions 8 422 5 669 32 644 3 978 9 617 22 342 422 83 094 Additions from new subsidiaries 1 459 22 081 67 987 956 1 616 1 306 882 96 287 Transfers - - - 113 (113) - - - Disposals (829) (1 723) (794) (786) (7 382) (5 634) - (17 148) Balance as of December 31,2023 184 591 65 054 145 765 25 855 22 161 33 976 2 798 480 200 Accumulated depreciation: - Balance as of January 1,2022 -11 525 22 777 12 673 7 191 - - 54 166 Charged for the period -1 517 3 348 2 424 4 549 - 6 11 844 Depreciation of new subsidiaries assets - 15 2 8 - - - 25 Depreciation of disposals -(58) (175) (2 228) (5 319) - - (7 780) Balance as of December 31,2022 -12 999 25 952 12 877 6 421 - 6 58 255 Charged for the period -2 199 9 971 3 369 5 691 - 485 21 715 Depreciation of disposals -(1 230) (734) (663) (7 305) - - (9 932) Depreciation of new subsidiaries assets -7 617 40 786 835 970 - 550 50 758 Transfers - - - 59 (59) - - - Balance as of December 31,2023 -21 585 75 975 16 477 5 718 - 1 041 120 796 Carrying amount as of December 31, 2023 184 591 43 469 69 790 9 378 16 443 33 976 1 757 359 404 Carrying amount as of December 31, 2022 175 539 26 028 19 976 8 717 12 002 15 962 1 488 259 712 AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 28 4. Property, plant and equipment (continued) The Group has lease agreements for land, office space and vehicles used in the ordinary activities. The terms are between 2 and 19 years with extension options. To secure investment and working capital loans received by the Group, the Group has established a pledge and mortgage in favor of the creditor banks on property, plant and equipment, with a carrying amount of BGN 127 973 thousand (see also notes 14 and 19). The Group has included in the property, plant and equipment assets acquired under financial lease agreements with a carrying amount of BGN 9 381 thousand (see note 15). To determine the fair value of the land owned, the Group uses the services of a licensed appraiser with recognized professional qualifications and experience. Fair value is based on the market value, which is the expected amount for which a property can be exchanged on the valuation date between a willing buyer and seller in a market transaction after the relevant marketing in which the parties have acted with awareness. The market value is determined as a weighted-average value of the results obtained by the individual methods and weights, expertly determined according to the reliability of the information used and the experience of the appraiser. The fair value of land is categorized as the fair value of Level 3 based on the inputs for the valuation technique used. Assets under construction presented in the consolidated statement of financial position represent expenses incurred by the Group for construction and acquisition of property, plant, and equipment, which at the end of the reporting period have not been completed and have not been put into operation as follows: 31.12.2023 31.12.2022 BGN’000 BGN’000 Construction and modernization of warehouses,agricultural and logistics facilities 33 976 15 962 Total 33 976 15 962 AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 29 5. Intangible assets Software Rights-of-use Cost of acquisition of intangible assets Total BGN'000 BGN'000 BGN'000 BGN'000 Cost: Balance on January 1, 2022 372 107 97 576 Additions - - - - Disposals - - - - Balance on December 31, 2022 372 107 97 576 Additions 101 - - 101 Additions from newly acquired subsidiaries 143 - - 143 Disposals - - (97) (97) Balance as of December 31, 2023 616 107 723 Accumulated depreciation: Balance as of January 01, 2022 359 89 - 448 Charged for the period 13 4 - 17 Depreciation of disposals - - - - Balance as of December 31, 2022 372 93 - 465 Charged for the period 37 4 - 41 Depreciation from newly acquired subsidiaries 35 - - 35 Depreciation of disposals - - - - Balance as of December 31, 2023 444 97 - 541 Carrying amount on December 31, 2023 172 10 - 182 Carrying amount on December 31, 2022 - 14 97 111 6. Non-current investments December 31,2023 December 31,2022 BGN’000 % BGN’000 % „AB Investments Group” AD 10,100 50.00 10,100 50.00 „AgroOil Consult” OOD 505 50.00 505 50.00 „Energy Solar Technology” AD 20 33.33 20 33.33 “Ecobulpack” AD 9 0.46 9 0.46 “Korn Star” OOD - - - - Total 10,634 x 10,634 x "Energy Solar Technologies" JSC develops activity in the field of energy production from renewable sources, through the utilization of solar energy, through investments in solar parks. Investments in energy projects from renewable sources are within the scope of the Group's activities, as part of the developed business model. The activity of "AB Investments Group" AD is focused on the construction and sale of real estate. When preparing the consolidated financial statements for 2023, the management of the Group has considered that there are grounds to treat "Korn Star" OOD as a subsidiary. On March 31, 2022, "Korn Star" OOD, according to a signed contract, acquired the commercial enterprise of the agricultural cooperative "Vedrina". The value that the Group paid for this acquisition is BGN 1,300 thousand. AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 30 7. Non-current receivables 7.1. Receivables from clients under certain conditions During a previous period, the Group agreed on the settlement of a trade receivable under deferred payment terms. The receivable is to be settled after 2022. The receivable is secured by a real estate, owned by the debtor. An interest of 5 % p.a. is accrued. 7.2. Long-term trade loans receivable In 2022 and 2023, the Group has granted loans to a related party in the amount of BGN 5 192 thousand. The loans bear interest at rates ranging between 5% and 5.5% per annum. The loans are repayable in July 2024 and May 2025. The short-term portion of these loans amounting to BGN 2 608 thousand and interest amounting to BGN 223 thousand are presented as part of the loans and borrowings granted (see item 10). 8. Goodwill The goodwill presented in the consolidated statement of financial position arose as a result of business combinations carried out during the current year, related to the acquisition of control over the net assets and activities of subsidiaries. The management of the Group has carried out the necessary procedures to carry out the mandatory test for impairment of the goodwill recognized in the consolidated statement of financial position, upon acquisition of subsidiaries, and considers that as of December 31, 2023 there are no conditions for accrual of impairment of the goodwill recognized in the statement of financial position, in the amount of BGN 2 326 thousand. 9. Inventories December 31,2023 December 31,2022 BGN’000 BGN’000 Goods 91 728 58 133 Impairment of goods - (6 184) Goods, net of impairment 91 728 51 949 Materials 31 191 35 486 Work in progress 21 624 16 031 Production 4 878 5 179 Total 149 421 108 645 9.1. Goods December 31,2023 December 31,2022 BGN’000 BGN’000 Sunflower 63 338 7 032 Wheat 10 548 16 684 Corn 8 242 11 000 Oil 7 479 - Barley 2 121 21 Fertilizers - 17 212 Total 91 728 51 949 AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 31 9. Inventories (continued) 9.2. Work in progress December 31,2023 December 31,2022 BGN’000 BGN’000 Wheat 10 526 7 849 Sunflower 6 103 4 330 Corn 3 089 2 690 Barley 1 564 1 162 Ethyl alcohol, DDGS 222 - Sorghum 120 - Total 21 624 16 031 9.3. Production December 31,2023 December 31,2022 BGN’000 BGN’000 Raw sunflower oil 3 333 3 207 Ethyl alcohol, DDGS 877 - Corn 376 1 263 Cereal 277 656 Refined oil 10 51 Useful waste 5 2 Total 4 878 5 179 In accordance with IAS 41 Agriculture , the Group should measure unprocessed agricultural produce at fair value at the point of harvest. The management of the Group has decided not to carry our such measurement on an ongoing basis during the reporting period, as in the ordinary course of business finished goods are sold on the market through their sale, and the amounts of agricultural produce in stock as at the reporting date are immaterial. The management also believes that the application of this policy does not lead to a change in the reported financial results of the group or a change of current stocks of inventories as compared to the results that would have been reported if the Group had measured unprocessed agricultural products at fair value at the date of production. As collateral, the Group has established a pledge on inventories in relation to investment and working capital bank loans (see note 14 and 19). AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 32 10. Accounts receivable and loans granted December 31,2023 December 31,2022 BGN’000 BGN’000 Receivables form trade loans, incl. interest 47 888 33 592 Receivables from clients 33 191 36 391 Impairment of receivables from clients (506) (866) Receivables from clients, net of impairment 32 685 35 525 Advances 26 917 25 833 Impairment of advances (598) (575) Advances, net of impairment 26 319 25 258 Receivables from government grants 9 950 3 458 Taxes recoverable 5 348 11 403 Current portion of long-term trade loans, incl. interest 2 831 - Prepaid expenses 1 390 557 Receivables from employees 27 128 Other receivables 140 103 Total 126 578 110 024 10.1. The Group has provided trade loans to other trade companies amounting to BGN 47 888 (as of December 31, 2022 - BGN 33 592 thousand). The interest on the loans for 2023 is in the amount of 3 to 5 percent annual interest. Part of the loans have a repayment deadline of 2024 and 2025, but according to the terms of the concluded contracts, under which no repayment plan has been agreed, the amounts can be settled ahead of schedule. Therefore, the Management of the Group treats receivables under the loan agreements as current. Short-term commercial loans granted to related enterprises and commercial counterparties are intended to support and finance the activities of these enterprises for general business and strategic purposes. 10.2. Receivables from customers as of December 31, 2023, 2022 derive mainly from the sale of grain, production and the provision of services. Usually, the Group agrees with its customers a 90-day payment period for receivables from sales of goods and production. The group uses loans from commercial banks in order to compensate for the credit periods granted to customers. Credit periods agreed with customers for the sale of services are within 60 days. The Group has entered into a factoring agreement with a Bulgarian financial institution (Factor) for the transfer of receivables from unrelated parties to the Factor. According to the contracted terms, the Factor has the right to demand monetary compensation from the Group, in the event that the debtor of the transferred claim does not pay its obligations within the stipulated terms. As the risks in relation to the transferred receivables remain with the Group, the receivables continue to be shown in the Group's consolidated statement of financial position and the cash received from the Factor is recognized by the Group as a loan secured by trade receivables. At the end of the reporting period, the carrying amount of the transferred receivables, which serve as collateral for the loan, amounted to BGN 7 271 thousand. The aging analysis of receivables from clients is presented below: 31.12.2023 31.12.202 BGN’000 BGN’000 Not overdue 18 215 22 076 Up to 90 days 5 746 6 506 90 – 180 days 3 365 3 387 180 – 360 days 1 099 1 708 Over 360 days 4 260 1 848 32 685 35 525 AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 33 11. Cash and cash equivalents December 31,2023 December 31,2022 BGN’000 BGN’000 Cash and cash equivalents in BGN 2 281 2 500 Cash and cash equivalents in foreign currency 4 212 2 017 Blocked cash and cash equivalents 31 31 Total 6 524 4 548 The Group's cash is in bank accounts with banks with stable long-term ratings. Management has performed an assessment of expected credit losses on cash and cash equivalents. The assessed value is less than 0.3% of the gross value of cash deposited in financial institutions, therefore it is determined to be immaterial and has not been charged in the financial statement of the group as of December 31, 2023. The blocked funds as of December 31, 2023, presented in the consolidated statement of cash flows, concerns blocked funds on a current bank account, which serve as collateral in relation to a precautionary measure imposed by a private bailiff in an upcoming enforcement case. 12. Share capital As of December 31, 2023, the registered share capital of Agria Group Holding AD amounts to BGN 6,800 thousand and is presented at its nominal value, and corresponds to its current court registration. At the end of the presented accounting periods, the Company's shareholders are: As of December 31, 2023 Name Number of shares % of capital „EMRA” EOOD 2 955 500 43.46 % Equity Investment EOOD 1 695 639 24.94 % Svetlomir Iliev Todorov 697 355 10.26 % Other individuals and companies with less than 5 % 1 451 506 21.34 % Total 6 800 000 100.00% As of December 31, 2022 Name Number of shares % of capital „EMRA” EOOD 2 795 500. 41.11 % „KOMERS”EOOD 1 855 639 27.29 % Svetlomir Iliev Todorov 697 355 10.26 % Other individuals and companies with less than 5 % 1 451 506 21.34 % Total 6 800 000 100.00% On August 24, 2023, the transformation of the shareholder Komers EOOD, through separation, was entered in the Commercial Register at the Registration Agency. During the separation, a new sole trading company with limited liability was established - "Equity Investment" EOOD, which is the owner of the right of ownership of the shares from the capital of "Agria Group Holding" JSC, which until the registration of the conversion were in the patrimony of "Komerse". Ltd. As of December 31, 2023, "Equity Investment" EOOD owns 1 695 639 shares of the capital of "Agria Group Holding", constituting 24.94% of the capital of the public company. On September 27, 2022, the Company acquired 50,000 of its own shares, at a price of BGN 27.80 per share (for a total of BGN 1 390 thousand), representing 0.73% of the registered capital. The purpose of the buyback is to increase the liquidity of the Company's shares. AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 34 13. Reserves The reserves presented in the consolidated statement of financial position include premiums, the accumulated gains of past years, reserves from subsequent evaluations of farmland and buildings, as well as reserves from revaluation of obligations to staff arising from defined benefit plans. 14. Interest bearing bank loans December 31, 2023 December 31, 2022 Type of currency Contracte d loan amount Maturity Non- current portion Current portion Total Non- current portion Current portion Total BGN’000 BGN’000 BGN’000 BGN’000 BGN’000 BGN’000 BGN’000 Investment loans EUR 15 000 06.02.2030 24 401 2 471 26 872 - - - EUR 8 200 30.09.2028 6 260 1 795 8 055 8 038 1 789 9 827 BGN 6 000 30.08.2027 1 777 667 2 444 2 444 667 3 111 BGN 6 000 02.12.2026 2 588 1 363 3 951 3 938 1 360 5 298 BGN 3 912 12.09.2026 711 428 1 139 1 138 428 1 566 BGN 5 867 20.02.2025 222 665 887 886 665 1 551 BGN 5 867 20.03.2024 - 326 326 326 653 979 EUR 2 000 30.01.2024 - 46 46 46 559 605 EUR 2 000 29.02.2024 - 93 93 93 559 652 BGN 4 000 04.02.2027 1 896 910 2 806 2 806 864 3 670 BGN 10 000 30.04.2024 - 514 514 514 1 116 1 630 BGN 6 000 14.08.2025 476 712 1 188 1 188 713 1 901 BGN 10 000 01.12.2026 2 222 1 111 3 333 3 333 1 111 4 444 BGN 5 000 28.06.2028 1 842 527 2 369 2 369 526 2 895 EUR 10 000 01.12.2033 - - - - - - EUR 10 320 01.05.2030 15 092 2 035 17 127 7 835 - 7 835 BGN 8 000 25.06.2028 6 506 534 7 040 Total 63 993 14 197 78 190 34 954 11 010 45 964 Interest on investment loans is payable monthly, with the agreed interest rates in the range of one-month and three-month EURIBOR, increased by 1,3 and 3,6 % points. Investment loan agreements also contain clauses for maintaining certain financial ratios, the implementation of which the Group's management currently controls and communicates with the creditor banks. The liabilities on the loans disclosed above have been secured for the benefit of bank creditors with: - Contracted mortgages on real estate owned by the Group (see note 4); - Special pledges on plant and equipment owed by the Group (see note 4); - Special pledges on trade accounts receivable. AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 35 15. Lease contracts obligations Operating lease obligations The operating lease obligations presented in the Statement of Financial Position include the liabilities of the Group under leases of land, buildings, and vehicles, which are recognized in accordance with the requirements of IFRS 16 Leasing (see also note 3.10 and note 4). As of December 31, 2023, operating lease obligations amount to BGN 15 323 thousand (December 31, 2022 – BGN 10,062 thousand). The short-term part of them, payable in the next 12 months after the accounting periods presented in this report, is presented in current liabilities (see note 19). Finance lease obligations The Group has concluded finance lease contracts for the acquisition of cars, machinery, equipment and agricultural machinery with a deadline for repayment of the last installments on them in the period 2023 - 2026 According to the terms of the contracts, the group owes an annual interest rate of three-month EURIBOR, increased by a margin of 1.8 % to 6.51 % on the outstanding part of the contractual obligation. As of December 31, 2023, the financial leasing liabilities amounting to BGN 14 652 thousand (December 31, 2022- BGN 10 915 thousand). The short-term part of them, payable in the next 12 months after the reporting periods presented in this report, is presented in current liabilities (see note 19). 16. Deferred tax assets/(liabilities), net December 31,2023 December 31,2022 BGN’000 BGN’000 Deferred tax assets: Tax effect of impairment of receivables 431 419 Tax effect of impairment of inventories 73 618 Tax effect of receivables written-off 57 94 Tax effect of current employee benefits 169 94 Tax effect of non-current employee benefits 77 36 Tax effect of unutlized paid leaves 97 52 Ttoal deferred tax assets 904 1 313 Deferred tax liabilities: Tax effect on revaluation reserve of non-depreciable assets (9 802) (9 899) Tax effect of difference of carrying amount of non-current assets (833) (84) Total deferred tax liabilities (10 635) (9 983) Deferred tax assets/(liabilities), net (9 731) (8 670) 17. Trade loans In November 2018 the Group entered into a loan agreement with a related party amounting to BGN 724 thousand. The amount was utilized in November 2018. The agreed interest rates are in the range of 3%. The deadline for repayment of the loan is April 2023. As of December 31, 2023, the loan is fully repaid (December 31, 2022 – BGN 724 thousand. see note 19). AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 36 18. Other non-current liabilities 18.1. Non-current liabilities to personnel The movement of non-current liabilities to employees is as follows: December 31,2023 December 31,2022 BGN’000 BGN’000 Opening balance 364 396 Current service cost 53 99 Expenses paid during the period (12) (40) Recognized actuarial gains/(losses) 2 (11) Financial expenses for future obligations 23 3 Expenses recognized in profit and loss 66 51 Revaluation of retirement benefit obligations recognized in other comprehensive income 24 (83) Additions from newly acquired subsidiaries 323 - Closing balance 777 364 The main actuarial assumptions used in the calculations are as follows: December 31,2023 December 31,2022 BGN’000 BGN’000 Discount rate 4.5% 5.5% Expected increase of salaries 3% 3% Weighted-average retirement age for man 64 64 Weighted average retirement age for woman 62 62 In addition, in the event of early retirement due to incapacity for work, staff are entities to benefits of up to two monthly salaries, increased by 100% for a minimum of five years of service and provided that no such benefits have been received in the last five years. The demographic statistical assumptions used are based on the following: - rate of staff turnover in the group during the past few years; - mortality rate of the population of Bulgaria for the period 2020 - 2022 according to the National Statistics Institute; - statistics of the National Health Information Centre on disability of the population and early retirement. 18.2. Government grants The Group has received financial assistance under the programme for rural development granted by the State Fund "Agriculture" during the period 2014-2020. The grant amounts to BGN 1 298 thousand. Government grants, presented in statement of financial position as of December 31, 2023, amounting to BGN 777 thousand (December 31, 2022 – BGN 880 thousand) represent deferred income for group of assets acquired, which should be recognized in statement of profit or loss and other comprehensive income on a systematic basis during the lifetime of assets. The current portion amounts to BGN 103 thousand (December 31, 2022 – BGN 103 thousand). AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 37 19. Current liabilities 19.1. Current interest-bearing bank loans Type of currency Contracted loan amount in BGN’000 Maturity December 31,2023 December 31,2022 BGN’000 BGN’000 Revolving working capital loans EUR 22,000 30.11.2024 30 569 18 604 BGN 6,000 30.06.2024 4 429 2 944 EUR 30,000 12.07.2024 54 355 43 915 BGN 4,000 30.01.2024 540 3 611 BGN 2,000 30.01.2024 2 000 2 000 EUR 5,000 30.11.2024 9 010 2 151 EUR 39,000 28.02.2025 34 884 6 229 BGN 20,000 30.11.2024 16 250 8 309 EUR 15,0000 12.07.2024 26 831 27 491 BGN 1,000 30.07.2024 990 600 EUR 10,000 17.01.2024 11 504 - BGN 1,200 30.01.2023 - 1 200 BGN 8,823 31.08.2024 7 832 - BGN 10,000 14.03.2024 4 415 - Total 203 609 117 054 Working capital loans interests are due monthly, with the agreed interest rates in the range of one-month and three-month EURIBOR, increased by 1.20 and 3.0 percentage points. In favor of the creditor banks the following collaterals are established: - Agreed mortgages on real estate owned by the Group (see note 4); - Special pledge on machinery and equipment owned by the Group (see note 4); - Special pledges on materials, goods and finished products owned by the Group (see note 9); - Special pledges on trade receivables, as well as current and future receivables of the Group from State Fund "Agriculture" 19.2. Current trade loans In the previous year, the Group received loans from trade companies amounting to BGN 10 000 thousand. The loan interests are 3.2% per annum. As of December 31, 2023, the loan obligation amounts to BGN 4 300 thousand principle and BGN 1 677 thousand interest (December 31, 2022 – BGN 4 300 thousand principle and BGN 1 540 thousand interest). The loan is unsecured. 19.3. Trade and other liabilities December 31,2023 December 31,2022 BGN’000 BGN’000 Current portion of non-current interest-bearing loans, incl. interests 14 240 11 010 Liabilities on factoring contracts 7 271 - Liabilities to suppliers 6 633 2 547 Current portion of finance lease obligations 4 302 3 205 Current portion of operating lease obligations 3 034 1 828 Taxes 2 818 3 582 AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 38 19.3. Trade and other liabilities (continued) December 31,2023 December 31,2022 BGN’000 BGN’000 Liabilities to personnel 2 616 1 730 Advances received 1 962 2 848 Obligations under contracts for rent of agricultural land 1 643 811 Social security 583 442 Current portion of Government grants 103 103 Current portion of non-current trade loans, incl. interest - 814 Other liabilities 261 404 Total: 45 466 29 324 20. Income from sales Year ended Year ended December 31,2023 December 31,2022 BGN’000 BGN’000 Income from sales of goods and materials 612 779 616 487 Income from sales of production 108 545 73 347 Income from sales of services 4 926 6 595 Total: 726 250 696 429 21. Income from government grants Year ended Year ended December 31,2023 December 31,2022 BGN’000 BGN’000 Income from grants, relate to expenses 12 662 7 697 Total: 12 662 7 697 22. Other income Year ended Year ended December 31,2023 December 31,2022 BGN’000 BGN’000 Income from penalites 1 660 1 384 Profit from sales of non-current assets, net 243 442 Income from sales of non-current assets 440 442 Carrying amount of assets sold (197) - Other income 1 658 91 Total: 3 561 1 917 AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 39 23. Materials expenses Year ended Year ended December 31,2023 December 31,2022 BGN’000 BGN’000 Main materials 111 913 91 287 Fuel and lubricants 9 469 11 485 Electricity, natural gas, and water 8 634 2 584 Spare parts and materials for repairs 3 831 2 472 Office materials and consumables 161 47 Other 611 660 Total: 134 619 108 535 24. Hired services Year ended Year ended December 31,2023 December 31,2022 BGN’000 BGN’000 Logistics, processing, and export expenses 17 723 7 564 Production related hired services 6 911 7 135 Consulting services 2 106 1 366 Insurances and subscriptions 1 863 1 096 Taxes 1 551 957 Rents 1 240 1 361 Maintenance and repairs of assets 1 029 720 Notary, legal and administrative services 583 143 Communication expenses 170 118 Other 2 618 574 Total: 35 794 21 034 Production-related hired services include all costs of rents, lease of agricultural machinery, as well as agricultural services. Logistics expenses are related to the transportation of finished goods and production. Insurance is made on non-current assets - agricultural machinery and attached equipment, owned by the Group. The expenses for audit services of the companies of the Group for 2023 and 2022 amounts to BGN 64 thousand. The auditors of the Group did not provide other consulting services, except those for the independent financial audit. 25. Personnel expenses Year ended Year ended December 31,2023 December 31,2022 BGN’000 BGN’000 Salaries and wages 24 956 19 243 Social security 3 834 2 667 Unutilized paid leaves 577 330 Total: 29 367 22 240 AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 40 26. Other expenses Year ended Year ended December 31,2023 December 31,2022 BGN’000 BGN’000 Advertising expenses and donations 222 380 Carrying amount of assets written-off 494 - Business trip expenses 241 217 Receivables written-off 133 184 Interest on tax liabilities and penalties 99 53 Expenses for penalties and compensations 1 192 48 Other 744 317 Total: 3 125 1 199 27. Impairment expenses Year ended Year ended December 31,2023 December 31,2022 BGN’000 BGN’000 Impairment of goods 706 6 184 Impairment of accounts receivable (31) 576 Total 675 6 760 28. Financial income Year ended Year ended December 31,2023 December 31,2022 BGN’000 BGN’000 Interest income 2 471 927 Income from foreign exchange operations 632 1 083 Income from dividends 80 100 Profit from operations with financial assets - 1 181 Total 3 183 3 291 29. Financial expenses Year ended Year ended December 31,2023 December 31,2022 BGN’000 BGN’000 Interest expenses on loans and finance leases 12 728 4 059 Loss from operations with financial assets 3 447 - Bank taxes and commissions 1 777 793 Expenses on foreign exchange transactions 244 468 Total 18 196 5 320 AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 41 30. Profit from acquisition of subsidiaries As disclosed in note 2.5. above, on February 8, 2023, the Group acquired the company "Almagest" EOOD. The cost of the investment and the gain arising from the acquisition of control transaction are as follows: BGN’000 Acquisition price 47 925 Fair value of net assets acquired (80 081) Profit from acquisition of subsidiaries (32 156) The carrying amount and fair value amount of the net assets upon acquisition of the net assets of the new subsidiary are as follows: Fair value Carrying amount BGN’000 BGN’000 Property, plant, and equipment 74 904 45 160 Intangible assets 103 103 Non-current receivable 6 956 6 956 Inventories 6 622 6 622 Current receivables 18 244 18 244 Cash and cash equivalents 80 80 Non-current liabilities (7 112) (7 112) Current liabilities (19 716) (5 550) Total net assets 80 081 50 337 The termination of the fair value of the distinguishable net assets in the newly acquired company was carried out on the basis of an assessment by independent appraisers. 31. Income tax expense December 31,2023 December 31,2022 BGN’000 BGN’000 Accounting profit 31 236 76 722 Applicable tax rate 10% 10% Income tax at applicable tax rate 3 124 7 672 Net tax effect of permanent tax differences (596) 470 Total income tax expense/(benefit) 2 528 8 142 32. Earnings per share and dividends Earnings per share are calculated using the net profit, which is subject to distribution among the shareholders of the Group. Year ended Year ended December 31,2023 December 31,2023 Profit attributable to shareholders (in BGN) 28,708,000 68,580,000 Weighted-average number of shares 6,800,000 6,800,000 Earnings per share (in BGN per share) 4.22 10.09 AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 42 32. Earnings per share and dividends (continued) With a Decision of the General Meeting in 2023, the Group distributed dividends in the amount of BGN 6 800 thousand (in 2022 – BGN 2 500 thousand). 33. Financial instruments and financial risk management The carrying amounts of assets and liabilities as of December 31, 2023 and 2022 by categories in accordance with IFRS 9 Financial instruments are presented in the following tables: Financial assets December 31,2023 December 31,2022 BGN’000 BGN’000 Loans granted 53 526 33,592 Trade receivables 59 004 60,783 Cash and cash equivalents 6 524 4,548 Total 119 054 98,923 Financial liabilities December 31,2023 December 31,2022 BGN’000 BGN’000 Interest bearing loans 287 776 169,672 Finance lease obligations 14 652 10,915 Operating lease obligations 15 323 10,062 Trade liabilities 15 866 5,395 Total 333 617 196,044 33.1. Financial risk factors The use of financial instruments exposes the group to market, credit and liquidity risk. These paragraphs provide information on the objectives, policies, and processes for managing these risks, as well as on the capital management. The financial risks are currently identified, measured, and monitored using various controlling mechanisms introduced for determining adequate prices of products and services, the cost of borrowings and the forms of maintaining free liquid funds without allowing an unreasonable concentration of a certain risk. Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk includes currency risks, interest rate risk and price risk. Credit risk is the risk that one party to a financial instrument will cause a financial loss for the other party by failing to discharge an obligation to the terms of a contract. Liquidity risk is the risk that an entity will encounter difficulty in meeting obligations associated with financial liabilities. 33.1.1. Currency risk The Group trades in a currency other than its functional currency, which is why it is exposed to risk related to possible changes in exchange rates. Such risk arises mainly from changes in the US dollar exchange rate, as the Group makes purchases denominated in US dollars. Transactions in euros do not expose the group to currency risk, as since January 1, 1999 BGN has been pegged to this currency. The sensitivity analysis to foreign exchange risk shows that the financial results of the Group would not change significantly due to changes in the exchange rate, as the group does not have significant foreign exchange risk exposures. AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 43 33.1. Financial risk factors (continued) 33.1.2. Interest rate risk The Group is exposed to interest rate risk because some of the loans received have a variable interest rate agreed as a base interest rate (EURIBOR), increased by a certain margin. In 2023 and 2022, loans with variable interest rates are in EUR and BGN. The interest rates are specified in the respective notes. December 31,2023 December 31,2022 BGN’000 BGN’000 Instruments with fixed interest rate Financial assets 48 832 30,940 Financial liabilities 4 300 5,024 Instruments with fixed interest rate Financial assets - - Financial liabilities 281 799 163,018 The sensitivity analysis to interest rate risk is based on the assumption that interest rate positions with variable interest rates at the date of the statement of financial position existed in the same amount throughout the year and reasonably possible increase/decrease in interest rates by 0.5%. If interest rates were higher/lower by 0.5%, provided that all other variables were constant, the financial result after taxes for the year would be BGN 143 thousand (December 31, 2022 - BGN 343 thousand) lower/higher. 33.1.3. Credit risk Credit risk is the risk that one party to a financial instrument will fail to meet its obligation and thereby cause a loss to the other. The financial assets that potentially expose the group to credit risk are mainly sales receivables and interest loans. The Group is mainly exposed to credit risk in the event that customers fail to meet their obligations. The Group's policy in this area is aimed at selling to customers with an appropriate credit reputation and the use of adequate collateral as a means of limiting the risk of financial losses. The credit quality of customers is assessed considering financial condition, experience and other factors. Credit limits have been introduced, compliance with which is monitored regularly. 33.1.4. Liquidity risk Liquidity risk is the risk that the group will fail to pay its financial liabilities when they fall due. The policy in this area is aimed at ensuring the availability of sufficient liquid funds, which can be used to settle liabilities when they fall due, including in emergency and unforeseen situations. The following table presents the agreed maturities of financial liabilities based on the earliest date on which the Group may be required to pay them. The table shows the undiscounted cash flows, including principal and interest: AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 44 33.1. Financial risk factors (continued) 33.1.4. Liquidity risk (continued) December 31, 2023 BGN’000 Up to one year Between two and five years Over five years Total Interest bearing loans liabilities 223 783 46 534 17 459 287 776 Finance lease obligations 4 302 10 350 - 14 652 Trade and other liabilities 15 866 - - 15 866 243 951 56 884 17 459 318 294 December 31, 2022 BGN’000 Up to one year Between two and five years Over five years Total Interest bearing loans liabilities 134,718 34,028 926 169,672 Finance lease obligations 3,205 7,710 - 10,915 Trade and other liabilities 5,395 - - 5,395 143,318 41,738 926 185,982 33.2. Capital management The Group manages its capital to operate as a going concern while it seeks to maximize returns to shareholders through the optimization of the debt-to-equity ratio (return on capital invested). The aim of the management is to maintain the confidence of investors, creditors, and the market and to ensure the future development of the group. The management of the Group monitors the capital structure based on the net debt-to-equity ratio. Net debt includes non-current and current interest-bearing loans and non-current and current finance lease liabilities, less cash. Share capital, reserves and accumulated profits form the equity of the Group. December 31,2023 December 31,2022 BGN’000 BGN’000 Debt 302 428 180,587 Cash and cash equivalents (6 524) (4,548) Net debt 295 904 176,039 Equity 307 107 285,170 Debt to equity ratio 0.96 0.62 The management of the Group determines the amount of capital required in proportion to the level of risk that characterizes individual activities (projects, business segments). The maintenance and adjustment of the capital structure is carried out in close connection with changes in economic conditions, as well as depending on the level of risk inherent in the relevant assets (projects) in which investments are made. The main tools that are used to manage the capital structure are: sale of assets, to reduce the level of indebtedness, etc. All decisions on changes in this direction are made considering the balance between the price and the risks inherent in the various sources of financing. AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 45 33.1. Financial risk factors (continued) 33.3. Fair value The Group's policy is to disclose in its financial statements the fair value of financial assets and liabilities, especially where quoted market prices exist. The concept of fair value assumes realisation of financial instruments by way of a sale. However, in many cases, particularly with respect to trade receivables and payables and loans, the group expects to realize these financial assets through their total payment or repayment over time. Therefore, they are presented at their nominal value or amortized cost. Most of the financial assets and liabilities are short-term trade receivables and payables and short-term loans, therefore their fair value approximates their carrying amount. The management of the Group considers that in the current circumstances the estimates of financial assets and liabilities presented in the statement of financial position are as reliable, adequate, and reliable as possible for the purposes of financial reporting. 34. Disclosure of related parties transactions During the year, the following major transactions were made with related parties, key management personnel, shareholders, as well as with other companies treated as related parties. 34.1. Key management personnel remuneration Key management personnel of the Group include the Executive Director and the members of the Board of Directors. The key management personnel remuneration includes the following costs: 2023 2022 BGN’000 BGN’000 Current remmunerations: Salaries 1 438 812 Total 1 438 812 The Group has entered into transactions with its shareholders as well as with other companies treated as related parties. 34.2. Transactions with shareholders The transactions and outstanding balances as of December 31, 2023are as follows: Outstanding balance Name Type of transaction Turnover Receivable Liabilitiy BGN’000 BGN’000 Komers AD Trade transactions – purchases 63 - 3 Trade transactions – sales 1 477 2 235 Loans granted 335 6 843 - Interest on loans granted 534 1 095 - Total: х 10 173 3 AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 46 34. Disclosure of related parties transactions (continued) 34.3. Transactions with other related parties Agro Oil Consult OOD Trade transactions – purchases 6 316 - 74 Interest on loans granted 10 - - Interest on loans received 17 - - Dividends received 80 - - Total: х - 74 Energy Solar Technologies AD Trade transactions-purchases 26 - - Loans granted 2 320 2 970 Interest on loans granted 131 139 - Total: х 3 109 - AB Investments Group AD Loans granted 2 738 5 192 - Interest on loans granted 191 223 - Total: х 5 415 - All outstanding balances with related parties are current. The conditions of the transactions do not differ from the market conditions that apply between non-related parties. 35. Events after the reporting period end On January 31, 2024, Agria Group Holding AD entered into a contract for the acquisition, in accordance with the legal procedure (through a contract for the transfer of company shares with notarized signatures and content in accordance with Article 129 of the Commercial Law) of the ownership right of 100% of the shares of the capital of a commercial company Komers EOOD, developing activity in the field of agribusiness, through the production and trade of grain and oil crops in the region of North-Eastern Bulgaria, coinciding with the scope of the territory in which the companies of the holding develop commercial activity. The expected positive effects of the acquisition of shares from the capital of Commerce EOOD are in the direction of strengthening the market presence of Agria Group Holding AD regarding the main areas of the holding's activity, namely: the company's commercial and export activities, by securing raw materials in the form of grains crops for domestic and foreign trade. The expansion of the cereal trading activity favors the procurement of the main raw material for the processing direction in the holding's activity (processing of oilseeds and other cereals) to produce crude and refined sunflower oil and ethanol. The expected positive effects of the acquisition of shares from the capital of Commerce EOOD are in the direction of strengthening the market presence of Agria Group Holding AD regarding the main areas of the holding's activity, namely: the company's commercial and export activities, by securing raw materials in the form of grains crops for domestic and foreign trade. The expansion of the cereal trading activity favors the procurement of the main raw material for the processing direction in the holding's activity (processing of oilseeds and other cereals) to produce crude and refined sunflower oil and ethanol. The transaction supports the implementation of part of the investment program of the holding in the direction of increasing the owned and leased agricultural land in the lands where the subsidiary agro-companies of the holding cultivate agricultural land properties, in accordance with the long-term development strategy. AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2023 (continued) Consolidated financial statements as of December 31, 2023 47 35. Events after the reporting period end (continued) The uniting of the potential of Agria Group Holding AD and Commerce EOOD would represent a sustainable foundation for the future successful development of the areas of activity developed by the company, would lead to long-term security and sustainability of the holding's business model, to better rhythmicity of cash flows and adding value at the Group level. The transfer of ownership of the shares of the capital of Commerce EOOD was entered in the Commercial Register at the Registration Agency on February 23, 2024. The shares are transferred to Agria Group Holding AD without any obligations, encumbrances, rights, and claims of third parties. together with all rights arising out of or connected therewith. 36. Other disclosures At the end of February 2022, an armed conflict between Russia and Ukraine began in Europe. As a result, normal trade relations with the two affected countries have been greatly disrupted, and many countries in Europe, as well as the United States, have imposed several economic sanctions on Russia. All these events and measures could lead to changes in the prices of energy carriers and many other goods and services, as well as negatively affect the global and European economy in the coming years, as well as negatively affect the Group's activities and lead to to a change in investment plans. AGRIA GROUP HOLDING AD Annual consolidated report 2023 48 ANNUAL CONSOLIDATED REPORT AS AT DECEMBER 31, 2023 ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 49 AGRIA GROUP HOLDING JSC ANNUAL CONSOLIDATED ACTIVITY REPORT 2023 ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 50 ANNUAL CONSOLIDATED REPORT ON THE OPERATIONS OF AGRIA GROUP HOLDING AD, VARNA FOR THE 2023 FINANCIAL YEAR The present report has been drawn up in accordance with the provisions of Article 39, 44 AND 45 of the Accountancy Act, Article 100n (7) and (8) of the Public Offering of Securities Act (POSA) and Appendix No. 2 to Article 10, item 1, article 11, item 1 of Ordinance No. 2 of FSC on the Prospectuses for Public Offering and Admission of Securities to Trading on a Regulated Market. The report provides comments and analysis of the consolidated financial statements and other material information concerning the financial position and results of the operations of the Company and present fairly the position and the perspectives for development of the Company. The management of the Company, represented by the members of the Board of Directors of Agria Group Holding AD, believe that the circumstances that occurred during the past year of 2023 may be important for investors in deciding whether to invest in the securities of the Company. All circumstances that occurred have been disclosed in the terms and manners provided for in POSA to the investors, the regulated securities market and Financial Supervision Commission, and are available on the Company's website - www.agriabg.com ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 51 1. GENERAL INFORMATION ABOUT AGRIA GROUP HOLDING JSC COUNTRY OF ESTABLISHMENT: Republic of Bulgaria REGISTERED OFFICE AND BUSINESS ADDRESS: 111 Knyaz Boris I Blvd, Primorski District, Varna, Business Center, 9th floor. MAILING ADDRESS: 111 Knyaz Boris I Blvd, Primorski District, Varna, Business Center, 9th floor. TELEPHONE: 052/ 554000; FAX: 052/ 511602 INTERNET ADDRESS: www.agriabg.com E-MAIL ADDRESS: office@agriabg.com , t.ivanova@agriabg.com LEGISLATION: The Company operates in compliance with the existing Bulgarian legislation. UNIFIED IDENTIFICATION CODE: 148135254 AGRIA GROUP HOLDING AD was established by transformation through change of the legal form under the terms and conditions of Article 264 and the following of the Commerce Act from limited liability company AGRIA GROUP HOLDING into joint-stock company with the same company name. The joint-stock company is registered and entered into the Company Register with Decision from 28 August 2007 under company case No.3875/2007 under the docket of Varna District Court. The same Decision also enters the winding up of the transformed limited liability company and the name of the newly registered joint-stock company is AGRIA GROUP HOLDING. The Company was re-registered by entry into the Commercial Register maintained by the Registry Agency under the terms and conditions stipulated in the Commercial Register Act. There have been no other changes in the legal and organisational form of the Company other than the transformation specified above. The life of the Company is not limited in time and there are no other conditions for its termination. The company has not been wound-up, it has not gone into liquidation, and has not been deleted from the Commercial Register. In December 2007 the Company increased its capital in an initial public offering through the successful issue of 1,700,000 shares with par value of BGN 1 each and issue value of BGN 9.04 each. As at 31.12.2023 the registered capital of the Company was BGN 6,800,000 (six million and eight hundred thousand leva), distributed in 6,800,000 (six million and eight hundred thousand) ordinary, registered, dematerialized, voting shares with par value of BGN 1 (one lev) each. The subscribed capital of the Company has been fully paid in and has been entered into the Commercial Register of the Registry Agency under the batch file of the Company. Trading in shares issued by the Company is carried out on a regulated securities market, in keeping with the requirements of the Public Offering of Securities Act, the Rules of BSE-Sofia AD and the other applicable legislation. ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 52 Agria Group Holding AD holds 50 000 (fifty thousand) own shares, representing 0.74 % of its capital. During the past 2023, no own shares were aquired by the company. Management body The Company has a single-tier management system - Board of Directors. 2. REVIEW OF THE OPERATIONS AND POSITION OF THE COMPANY As a holding company, AGRIA GROUP HOLDING AD depends on the activities and results of its subsidiaries. The main objective of the Company is to participate in any form in other commercial companies or in their In its capacity of joint-stock company, which has issued shares in the initial share offering, which securities are allowed to be traded on the Regulated market, Agria Group Holding AD has fulfilled its obligation for entry in the Commercial Register under the order of the Commercial Register Act of the fact that the Company is public. The shares of the Company are listed on the Main Market of the Bulgarian Stock Excnage AD, Premium Shares Segment, assigned stock code AGH, ISIN code BG1100085072 Shareholding structure of Agria Group Holding AD as at 31 December 2023 Name/Shareholder’s name Number of shares/votes in GM Percent of capital Emra EOOD, Varna 2 955 500 43.46 % of capital Equity Investment EOOD, Targovishte 1 695 639 24.94 % of capital Svetlomir Iliev Todorov 697 355 10.26 % of capital Other legal entities and natural persons 1 451 506 21.34 % of capital • • Agria Group Holding AD Board of Directors Други Investor Relations Director Кристера АД Financial Director Агрия Груп Холдниг АД Executive Director ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 53 management. The business policy of the Company, including investments, should be considered mainly in terms of the operations of its subsidiaries, because Agria Group Holding AD functions as a legal entity-holding company, carrying out investment activities as managing the stakes it holds in its subsidiaries. Structure of AGRIA GROUP HOLDING AD Agria Group Holding AD is part of the following economic group EMRA EOOD Agria Group Holding AD OTHERS EQUITY INVESTMENT EOOD Kristera AD Korn Trade EOOD Agro EOOD Kristera Agro EOOD A G property Invest EOOD Bora Invest EOOD Bora Energy EOOD Aris Agro EOOD Toni-M EOOD Gruvar EOOD Elit-86 EOOD Diasvet EOOD Terra Protect EOOD BD Agri EOOD BD Farm EOOD Agra EAD Kehlibar EOOD Silk Gas BG EOOD Agro Oil Konsult OOD Korn star OOD Agrivia Oil EOOD Almagest EOOD ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 54 Agria Group Holding AD holds shares in the capital of the following commercial companies: • Kristera AD, Popovo – 59,554 ordinary registered shares with a par value of BGN 100 each, representing 99.26% of the capital in the company; • Korn Trade EOOD, Varna – 68,000 shares of BGN 100 each, representing 100% of the capital in the company; • Agro EOOD, Varna – 50 shares of BGN 100 each, representing 100% of the capital in the company; • Kristera-Agro EOOD, Devnya – 76,000 shares of BGN 100 each, representing 100% of the capital in the company; • AG Property Invest EOOD, Sofia – 122,050 shares of BGN 100 each, representing 100% of the capital in the company; • Bora Invest EOOD, Varna – 11,000 shares of BGN 100 each, representing 100% of the capital in the company; • Bora Energy EOOD, Varna – 622,000 shares of BGN 10 each, representing 100% of the capital in the company; • Aris Agro EOOD, Varna – 500 shares of BGN 10 each, representing 100% of the capital in the company; • Toni-M EOOD, General Toshevo – 500 shares of BGN 10 each, representing 100% of the capital in the company. • Elit-86 EOOD, Varna - 500 shares of BGN 10 each, representing 100% of the capital in the company. • Gruvar EOOD, Varna – 50 shares of BGN 100 each, representing 100% of the capital in the company. • BD Agri EOOD, Varna - 50 shares of BGN 100,000 each, representing 100% of the capital in the company. • BD Farm EOOD, Varna - 50 shares of BGN 100,000 each, representing 100% of the capital in the company. • Diasvet EOOD, village of Pisanets, Russe region - 100 shares of BGN 50 each, representing 100% of the capital in the company. • Terra Protect EOOD, Sofia – 90,000 shares of BGN 10 each, representing 100% of the capital in the company. • Agra EAD, Varna – 119 545 ordinary registered shares with a par value of BGN 100 each, representing 100% of the capital in the company. • Kehlibar EOOD, Lyaskovets – 7,600 shares of BGN 1,000 each, representing 100% of the capital of the company. • Silk Gas BG OOD – 500 shares of BGN 10 each, representing 100% of the capital of the company. • Agro Oil Konsult OOD - 50,500 shares of BGN 10 each, representing 50% of the capital of the company • Korn Star OOD - 52,200 shares of BGN 10 each, representing 40% of the capital of the company • AgriVia Oil EOOD – 4,000,005 shares of BGN 1 each • Almagest’ EAD – 441 866 ordinary registered shares with a par value of BGN 80 each, representing 100% of the Company's capital. On 5th October 2023, in the Commercial Register and Register of Non- Profit Legal Entities at the Registry Agency, the conversion of the company from single-member joint- ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 55 stock company to a single-member limited liability company in "ALMAGEST" EOOD with UIC 207546986 was entered. Type of Operations of Agria Group Holding AD Agria Group Holding AD, through its subsidiaries, is engaged in the following types of business: ● Agribusiness in North-Eastern Bulgaria ● Processing industry (storage and processing of grain and oil-bearing crops) centred in the towns of Lyaskovets and Ihtiman. ● Trade/export operations Main administrative and logistic centers – the towns of Sofia, Popovo, Devnya, Varna, Dobrich and Ihtiman. Besides these main activities, the holding also performs other auxiliary activities - trade in farming fertilisers, plant protection chemicals, fuels and lubricants, sowing seeds by world-renowned companies such as Korteva, Baier, Syngenta, Lima, Grain, BASF, etc. The activity of part of the subsidiaries of Agria Group Holding AD is in the field of agribusiness. The Company’s agribusiness activities include: - Cultivation of agricultural land, production of grain and oil-bearing crops; - Services related to various agronomic techniques. Another type of business the holding is engaged in is processing industry and trade in grain and grain derivatives, including export operations . The total capacity of the storage facilities of Agria Group Holding JSC amounts to approx. 380,000 tonnes. The storage bases of the holding are concentrated in five main logistic centers located in the towns of Popovo, Devnya, Lyaskovets, Dobrich and Ihtiman. There also are auxiliary warehouse capacities in the main agribusiness centers of the Company in town of Belogradets, town of Provadia, Gradinarovo village, Yankovo village, town of Targovishte, town of Popovo, Osenets village, Pisanets village, Vedrina village, town of Kardam and Rositsa village. ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 56 ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 57 MAIN LOGISTIC CENTERS Approx 750,000 – 800,000 tonnes of grain and oil-bearing crops are yearly stored and traded in the holding’s grain facilities. The Company has built a mature and effective market structure to procure the incoming raw materials (grain crops), a flexible logistic structure and good positioning of the main locations where grain is stored (grain facilities) near cargo terminals (Port of Varna, Port of Bourgas, Port of Constanta). The closed production cycle, which minimizes the effect of outside factors with regard to purchasing prices and the quality of the main raw materials, and the large quantity of cultivated farmland, including land owned or rented by companies from the holding structure engaging in agribusiness, help to largely secure the foreign trade operations of the company as well. Devnya • Constructed in 2007 • Equipped with modern laboratory • Property of Krustera-Agro EOOD • Storage capacity of 65000 mt • Key location to Port Varna Lyaskovets • Sunflower seed processing plant • Property of Kehlibar EOOD • Storage capacity of 20000 mt • Annual production capacity of 50000 mt • Production of crude and refined sunflower oils, sunflower husk, pellets and meal Popovo • The biggest logistic center • Property of Kristera AD • Storage capacity of 170000 mt • Laboratory analysis • Over 70 trucks fleet Ihtiman • Corn processing plant • Property of Almagest EOOD • Storage capacity 40 000 mt • Annual production capacity of 35 000 000 l ethanol and 25 000 mt DDGS Dobrich • The newest logistic center • Property of Silk Gas BG EOOD • Storage capacity of 70000 mt • Key location to Port Varna • ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 58 The main clients for the export transactions of the of the Group’s companies are global leaders in grain trade, including Cofco International Romania S.R.L., Cofco International Bulgaria EOOD, ADM Bulgaria Trading EOOD, ADM Razgrad EAD, Viterra Romania, Cargill Bulgaria, Lecureur France, The Andersons INC USA, CHS Bulgaria EOOD etc. 3. INFORMATION ABOUT IMPLEMENTED INVESTMENTS PER TYPE OF OPERATION OF AGRIA GROUP HOLDING AD IN 2023 Agribusiness During the financial 2023 the subsidiaries continued acquisition of agricultural land in the regions of Veliki Preslav, Razgrad, Targovishte, Ruse, Provadia and Popovo through purchase agreements at a total value of EUR 2,300,000. The lands purchased are about 1630 hectares. The investments implemented in augmentation of capacity, reconstruction and modernization of existing storage facilities in the different agricultural bases of the company amount to a total value of EUR 570,000 for the financial 2023. As at the end of 2023, the investments made in agricultural machinery are in the amount of EUR 3,750,000. Trade/export The investments implemented in the field of transportation, specifically in expanding the fleet of the company and improving the logistic structure amount to EUR 1,660,000. During 2023, the investments implemented in the construction of a new logistic center in the region of North- Eastern Bulgaria with a storage capacity of 94,000 m3 amounts to EUR 5,440, 000. By the end of 2023, the investments implemented in the acquisition of assets and shareholdings in legal entities developing activities in the field of agricultural production and processing of grain crops amount to EUR 24,490,000. Processing industry As at the end of 2023, the investments made in the construction of the oilseed processing plant with service storage silos and oil storage tanks, located on the territory of Kristera AD warehouse, town of Popovo amount to approximately EUR 1,960,000. For the financial year 2023, AGRIA GROUP HOLDING А D has direct investments in the process of execution as follows: Agria Group Holding AD has acquired in the procedure provided by the legislation the ownership of 100% (one hundred percent) of the capital of the commercial company "Almagest" AD, entered in the Commercial Register and in the register of non-profit organizations at the Registry Agency with UIC 175340142. 4. INVESTMENT PROGRAM FOR 2024 Sources of Financing - The Company plans to finance about 30% of the investment program of Agria Group Holding for 2024 with its own funds. ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 59 - The remaining part of the investments will be financed with longterm debt financial instruments. - In view of the specialisation of the Company mainly in agribusiness sector, one source of grants is the European Union in the form of grant schemes for supporting the agricultural producers under the Operational programme Good Governance /OPGG/, Eco-schemes and Payments under Natura 2000 for agricultural land. Investments per types of operations of Agria Group Holding AD Agribusiness  Purchase of farmland in the areas where farming subsidiaries of the holding cultivate farmland. Due to the usual trading activity of the companies in the holding group, specializing in agricultural production, the effect of the land purchasing agreements meets the expectations of the Company referring to fulfilment of the Investment Program for acquisition of agricultural lands. The lands purchased are located in regions where the companies are already cultivating agricultural lands which will lead to the consolidation of the total lands cultivated by the companies of the Group. For 2024 the Holding plans investments amounting to EUR 4,000,000.  Augmentation of capacity, reconstruction and modernization of existing storage facilities in the different agricultural bases of the company. For 2024 the Holding plans investment amounting to EUR 350,000.  Investments in agricultural machinery. For 2024 the company plans investments amounting to EUR 1,350,000. Trade/export operations  The Company does not plan investments in transport for 2024.  In view of increasing the market presence in North- Eastern Bulgaria as well as strengtening the trading and exporting of the company, for 2024 the holding plans investments for the completion of a new logistic center in the area, which would have a storage capacity of 94 000m3. The investment amounts approx. to EUR 12,900,000, of which EUR 1,600,000 are planned to be invested in 2024.  Investments in acquisition of assets and shares in legal entities, operating in the field of agricultural production and grain processing of grain. The planned investments for 2024 in the indicated directions from the companies of the holding structure amounts to about EUR 4,000,000. ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 60 Manufacturing industry  Investment in an oilseed processing plant with service storage silos and oil storage tanks, located on the territory of Kristera AD warehouse, town of Popovo. The planned implementation of the investment project is within 2023-2027. According to preliminary data, its total cost amounts to about EUR 55 million, and for 2024 it is planned to spend funds for the investment in the amount of about EUR 23 000 thousand.  Investment in a steam boiler for production of steam and electricity on the territory of the production base of Almagest EOOD. The investment will be implemented using waste-free green technologies that are favourable to the climate and environmental protection through the use of straw as a main raw material of plant origin for the production of steam and electricity. The investment is planned to take place by the end of 2024, and the total amount is about EUR 5,600 thousand. The economic policy and business goals of the Company, incl. investments are oriented towards sustainable development and strategic investment planning, operational efficiency and corporate social responsibility, contributing to the stable and sustainable development of the Company and the holding group in economic, social and environmental aspects. The company uses the potential of various mechanisms that creates prerequisites for sustainable development of the holding group companies through diversification of the risk of adverse climate change and realization of savings of scale in the direction of agricultural production, on one side and through efficiency and value of new business on the other. Taking into account the parameters of the investment program of the companies in the holding structure as well as the conducted analyses and researches, we believe that the impact of the planned investment would cover the Company’s expectations for optimization of the segment of own grain production, strengthening the export orientation of the holding and adding value to the company through new types of operations for the companies in the holding structure. ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 61 The parameters of the investment program of the companies in the holding structure have been developped in a situation of a stable market and in managing specific risks for the normal business environment and for the holding group. In compliance with the recommendations of the European Securities and Markets Authority on the impact on financial market and considering the military conflict between Russia and Ukraine, and in compliance with the requirements of Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse, the Company undertakes to promptly disclose information on the actual or potential impact of the military conflict on its business, financial and economic position and on its planned investment intentions, as it include a quantitative and qualitative assessment of this impact in its financial reporting information as well as in the form of incidental information. As a consequence of the military conflict between Russia and Ukraine since the end of February of the previous year, normal trade relations with the two countries involved have been disrupted. The European Union and many countries around the world have imposed a number of economic sanctions on Russia. The restrictive economic and financial measures taken could lead to changes in the prices of energy sources and other goods and services that are important for the development of the Bulgarian economy. The corporate management analyses and monitors all developments in order to determine protective and stabilisation measures. With their implementation, it is expected that the negative consequences of the military conflict will be mitigated to the extent that they do not have a material adverse impact on the future viability and the Company's ability to continue as a going concern. 10% 3% 5% 10% 72% Planned investments for 2024 Agricultural land Agricultural machinery, transport and logistics Складови бази Acquisitions Manufacturing industry Agricultural land 4 000 Agricultural machinery, transport and logistics 1 350 Warehouse facilities 1 950 Aquisitions 4 000 Manifacturing industry 28 600 Total planned investments for 2023 (in BGN thousand) 39 900 ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 62 5. FINANCIAL INDICATORS AND FINANCIAL POSITION OF THE COMPANY OPERATING RESULTS A. Analysis of the financial state on a consolidated basis FINANCIAL CONSOLIDATED REPORT OF AGRIA GROUP HOLDING AD (BGN in thousands) ASSESTS Current period Preceding period EQUITY, MINORITY INTERESTS AND LIABILITIES Current period Precedig period а 1 2 а 1 2 A. NON-CURRENT ASSETS A. EQUITY I. Property, plant, and equipment I. Share capital 1. Land (terrains) 184,591 175,539 Subscribed and paid-up capital, incl.: 6,800 6,800 2. Buildings and constructions 43,469 26,028 ordinary shares 6,800 6,800 3. Machines, equipment and plant 69,790 19,956 preference shares - - 4. 0 0 Redeemed own ordinary shares (1,390) (1,390) 5. Vehicles 9,378 8,717 Redeemed own preference shares - - 6. Fixtures and fittings - 20 Capital not paid in - - 7. Cost of acquisition and disposal of non-current tangible assets 33,976 15,962 Group I total: 5,410 5,410 8. Other 18,200 13,490 II. Reserves Group I total: 359,404 259,712 1. Premium reserves from securities issues 13,668 13,668 II. Investment property - - 2. Reserve related to subsequent measurement of assets and liabilities 90,967 92,487 III. Biological assets - - 3. Specific reserves, including: 2,124 1,918 IV. Intangible assets general reserves 2,124 1,918 1. Property rights 10 14 specialized reserves 2. Software 172 - other reserves 0 0 3. Development products - - Group II Total: 106,759 108,073 4. Other - 97 III. Financial result Group IV total: 182 111 1. Accumulated profit (loss), including: retained earnings 166,230 103,107 V. Goodwill accumulated losses 1. Goodwill 2,326 2,326 one-off effect of changes in accounting policy 2. Negative goodwill 2. Profit for the current period 28,708 68,580 Group V total: 2,326 2,326 3. Loss for the current period VI. Financial assets Group III total: 194,938 171,687 1. Investments in: ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 63 subsidiaries joint ventures SECTION A TOTAL (I+II+III): 307,107 285,170 associates 10,625 10,625 other enterprises 9 9 2. Held to maturity - - B. MINORITY INTEREST 0 0 government securities - - bonds, including: - - C. NON-CURRENT LIABILITIES municipal bonds - - I. Trade and other payables other investments held to maturity - - 1. Payables to related enterprises - - 3. Other - - 2. Payables under loans received from banks and non-banking fin. institutions 74,343 42,654 Group VI Total: 10,634 10,634 3. Payables under the Settlement of Uncollectible Loans Act - - VII. Trade and other receivables 4. Trade loans 0 0 1. Receivables from related enterprises 5. Loan stock payables - - 2. Trade loan receivables 2,807 - 6. Other 12,289 8,234 3. Financial lease receivables - - Group I total: 86,632 50,898 4. Other 2,097 2,097 Group VII Total: 4,904 2,097 II. Other non-current liabilities 1,165 364 III. Deferred income VIII. Deferred expenses - - IV. Deferred tax liabilities 9,731 8,670 IX. Deferred tax assets - - V. Financing 674 777 SECTION A TOTAL (I+II+III+IV+V+VI+VII+VIII+IX): 377,450 274,880 SECTION C TOTAL (I+II+III+IV+V): 98,202 60,709 B. CURRENT ASSETS I. Inventory D. CURRENT LIABILITIES 1. Materials 31,191 35,487 I. Trade and other payables 2. Production 4,878 5,179 1. Payables under loans received from banks and non-banking financial institutions 222,151 131,269 3. Merchandise 91,728 51,949 3. Current portion of non- current liabilities 4. Work in progress 21,624 16,031 3. Current liabilities, including: 5. Biological assets - - payables to related enterprises 6. Other - - trade loans 5,589 6,654 Group I total: 149,421 108,645 payables to suppliers and clients 8,276 2,547 advances received 1,962 2,848 II. Trade and other receivables payables to employees 2,616 1,730 1. Receivables from related enterprises - - payables to insurance institutions 583 442 2. Receivables from customers and suppliers 32,685 35,525 tax liabilities 2,818 3,582 ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 64 3. Advances to suppliers 26,319 25,258 4. Other 10,566 3,043 4. Trade loan receivables 50,719 33,592 5. Provisons 5. Court receivables and writs 0 0 Group I total: 254,561 152,115 6. Tax reimbursable 5,348 11,403 7. Receivables from employees 27 128 8. Other 10,090 3,561 II. Other current liabilities - - Group II Total: 125.188 109,467 III. Deferred income - - IV. Financing 103 103 III. Financial assets 1. Financial assets held for trading, incl.: - - debt securities - - SECTION D TOTAL (I+II+III+IV): 254,664 152,218 derivatives - - other 2. Available-for-sale financial assets - - 3. Other - - Group III total: - - IV. Cash and cash equivalents 1. Cash in leva 2,281 2,500 2. Cash in Foreign currency 4,212 2,017 3. Restricted amounts 31 31 4. Cash equivalents Group IV total: 6,524 4,548 V. Deferred expenses 1,390 557 SECTION B TOTAL (I+II+III+IV+V) 282,523 223,217 TOTAL ASSETS (A + B): 659,973 498,097 EQUITY, MINORITY INTERESTS AND LIABILITIES (A+B+C+D): 659,973 498,097 1. Analysis of Assets The current assets in the issuer’s balance sheet comprise mainly its available inventory and commercial receivables in subsidiaries. As at 31.12.2023 their consolidated amount is BGN 282,523,000. The non-current consolidated assets as at 31.12.2023 amount to BGN 377,450,000. 2. Analysis of Liabilities The consolidated equity of the Holding as at 31.12.2023 is BGN 307,107,000. The company completed the reporting period with a profit after tax of BGN 28,708,000. ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 65 B. Analysis of the Consolidated statement of Comprehensive Income INCOME CONSOLIDATED STATEMENT OF AGRIA GROUP HOLDING AD (BGN IN THOUSAND) EXPENSES Current period Preceding period INCOME Current period Preceding period а 1 2 а 1 2 A. Operating expenses A. Operating income I. Expenses by nature I. Net sales of: 1. Materials 134,619 108,535 1. Production 108,545 73,347 2. External services 35,794 21,034 2. Merchandise 612,779 616,487 3. Depreciation 21,576 11,861 3. Services 4,926 6,595 4. Wages 25,553 19,517 4. Other 3,561 1,917 5. Social and health insurance 3,834 2,723 Group I total: 729,811 698,346 6. Carrying value of assets sold (excluding goods) 508,939 463,099 7. Changes in inventory of finished goods and work-in- progress -5,895 -7,436 II. Income from financing 12,662 7,697 8. Other, including: 3,800 7,959 including government financing 12,662 7,697 impairment of assets 675 6,760 provisions - - III. Financial income Group I total: 728,380 627,292 1. Interest income 2,471 927 2. Dividend income 80 100 II. Financial expenses 3. Gains from operations in financial assets and instruments - 1,181 1. Interest expense 12,728 4,059 4. Gains from changes in foreign currency exchange rates 632 1,083 2. Losses from operations in financial assets and instruments 3,447 0 5. Other - - 3. Losses from changes in foreign currency exchange rates 244 468 Group III total: 3,183 3,291 4. Other 1,777 793 Group II Total: 18,196 5,320 B. Total operating expenses (I + II): 746,576 632,612 B. Total operating income (I + II + III): 745,656 709,334 C. Operating profit - 76,722 C. Operating loss - - III. Share of the profit of associates and joint ventures - - IV. Share of on acquisition of subsidiaries 32,156 - IV. Extraordinary expenses - - V. Extraordinary income ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 66 D. Total expenses (B + III + IV) 746,576 632,612 D. Total income (B + IV + V) 777,812 709,334 E. Pre-tax profit 31,236 76,722 E. Pre-tax loss - - V. Tax 2,528 8,142 1. Corporate income tax for the current period 1,467 8,457 2. Expenses (economy) of deferred corporate income tax 1,061 -315 3. Other - - F. Profit after tax (E - V) 28,708 68,580 F. Loss after tax (E + V) - - incl. for minority interest 0 0 incl. for minority interest - - G. Net profit for the period 28,708 68,580 G. Net loss for the period - - Total (D+ V + F): 777,812 709,334 Total (D + F): 777,812 709,334 Because of the economic activity carried out and the reported income, Agria Group Holding AD closed its accounts as at 31.12.2023 with a positive net result on a consolidated basis of its operations to the amount of BGN 28,708,000. As at 31.12.2023, the equity of the Company on a consolidated basis stand at BGN 307,107,000, and it is the Company’s main source of internal liquidity. Of it, BGN 6,800,000 are subscribed and fully paid in share capital. The table below presents the internal sources of liquidity of the company in accordance with the non- consolidated financial statements. BGN in thousands - on a consolidated basis 31.12.2023 31.12.2022 Share capital 6,800 6,800 Subscribed capital 6,800 6,800 Capital not paid in - - Shares buyback (1,390) (1,390) Reserves 106,759 108,073 Financial result 194,938 171,687 Total equity 307,107 285,170 C. Liquidity The liquidity ratios are an indicator of the ability of the company to repay its debts in a timely manner. They are connected with the liquidity risk, which is the risk for the issuer not to have sufficient funds available to meet ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 67 maturing payables to creditors. The Company manages its assets and liabilities in such a way as to guarantee that it will cover its daily payments regularly and without delay. Cash in hand and in bank deposits as at 31.12.2023 stand at BGN 6,524,000 and is 2.56% of short-term liabilities. The liquidity ratios of Agria Group Holding AD, calculated on the basis of its non-consolidated financial statements, are shown in the following table: Liquidity indicators 31.12.2023 31.12.2022 Current ratio Current assets / current liabilities 0.80 1.47 Quick ratio (Cash + Cash equivalents + Receivables) / Current liabilities 0.52 0.75 Cash ratio (Cash + Cash equivalents) / Current liabilities 0.03 0.03 6. RISKS FACING THE COMPANY. GOALS AND POLICY OF THE COMPANY ON RISK MANAGEMENT The operation of each company is exposed to certain risks affecting its performance. The operation of Agria Group Holding AD is exposed to the risks listed below. The risk factors are listed consequentially in accordance with their significance to the operations of the issuer. Specific risks Market risks Market risk is related to the changes in market conditions. It includes income risks, profit risks, interest rate, liquidity and currency risks. Income risks The Company’s future sales are subject to normal market risks. The main future income depends on the possibility for AGRIA GROUP HOLDING AD to perform its market and investment strategy, as well as on the current market situation. To reduce those risks considerably, the Company relies on an increased intra-company capability of effective forecasting and planning, as well as on maintaining stable customer relations. Profit risks The market risk can also influence the Company’s expenses, particularly in cases when the rate of growth of expenses is faster than that of income. Interest rate risk The interest rate risk manifests itself in the possibility of a rise in the cost of financing the Company’s activities. Regarding fixed rate loans, in the case of a potential drop in market interest rates, the issuer may not succeed ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 68 in obtaining resources at the available lower interest rates. If such circumstances arise, the Issuer would be operating under less advantageous conditions than its competitors. Such development would lead to higher interest payments by the Issuer in comparison to other companies which would finance their activities at the current market rates; consequently, this would lead to lower net profit. Regarding floating rate loans, in the case of a potential drop in market interest levels, the interest rate payable by the Company on its loans will also drop. An interest rate risk for floating rate loans exists in the case of a rise in market levels, when the resources used by the Issuer will become more expensive. In order to minimise the interest rate risk, the Issuer diversifies the sources through which it ensures the financing of its activity. Liquidity risk Liquidity risk is a risk related to the ability for the Issuer to cover its trade payables to suppliers and creditors within the negotiated term and amount of payments. Agria Group Holding AD manages its assets and liabilities in such a way as to guarantee that it will cover its daily payments regularly and without delay. This risk component is minimised by accuracy and commitment in agreements with the trade counterparties with which cash revenue or payments are planned. Currency risk Currency risk is the risk that the Issuer may suffer losses due to the fluctuation of market prices of the various currencies it uses. Agria Group Holding AD carries out its operations predominantly in Bulgarian leva (BGN) and Euro (EUR). The Euro is the main currency in which the Issuer settles its foreign trade relations – sales of goods/produce and purchase of materials necessary for its activity. Under the conditions of a currency board and a fixed rate of the BGN against the EUR, the management of the company consider that the Issuer is not exposed to a significant risk of changes in currency rates. Operational risks The chief operational risks and the measures taken to minimise those risks are to be considered in terms of the operations of the Issuer’s subsidiaries, because Agria Group Holding AD functions as a legal entity which is a holding company carrying out investment activities, which aims to manage the stake it holds in its subsidiaries, and which does not directly carry out any other production and/or commercial activity of its own. The operational risk is related to damage or loss suffered by the Company due to human error, technological imprecision, and impossibility for machines and equipment to perform a certain task, or to a mistake in the procedure or organisation. The probability that the Issuer may suffer damage or loss due to human error, technological imprecision, and impossibility for machines and equipment to perform a certain task, or to a mistake in the procedure or organisation via its subsidiaries is insignificant. Part of the chief operational risks is related to a potential load on capacities and to providing the necessary raw materials. Potential risks could arise in relation to the workforce available in the regions where the subsidiaries of the Issuer perform their commercial activities. The main risk for the Issuer’s subsidiaries which perform commercial activities related to growing and storing agricultural produce includes inclement weather conditions, diseases and other natural risks. In order to minimise those risks and any potential loss, the subsidiaries obtain insurance policies for all areas on the ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 69 production in progress of all agro-technical activities against all main risks, together with storm, fire and hail, including insurance policies against freezing of all crops being grown. Insurance policies are obtained for all general risks, including earthquake risk for all real estate and production capacities owned by the companies in the group. Despite the tight competition, the Company considers that it has a competitive edge on the market owing to its experienced management staff and its established reputation. In this respect it should be noted that the management staff and the Company’s employees are highly qualified and motivated specialists, organised in relatively independent active structural units which maintain a maximally complete and up-to-date data base of the development and trends of the respective markets. Non-specific (systemic) risks The holding company and its subsidiaries are also exposed to systemic risks, mainly related to the macro environment in which they operate. These risks are not subject to supervision and under the control of Agria Group Holding’s management. The main systemic risk to the activity of the company and its subsidiaries can be identified as the military conflict between Russia and Ukraine, the main exporters of grain worldwide. The outbreak of war has complicated grain and oilseed exports, triggering fears of a food crisis and a high spike in commodity prices in 2023, as well as instability on international markets. Despite the establishment of export corridors from Ukraine and the current soothing of markets, the ongoing military situation threatens to deepen the conflict, which could lead to the restriction or hindrance of exports through the imposition of non-market administrative measures. The Company's management does not anticipate any adverse impact on the results of operations and business processes of the holding company as the Company has no direct exposure to related parties, and/or key customers or suppliers in Russia and Ukraine. Effect on liquidity The management concludes that there are no liquidity restrictions for the company and the group as a whole in short and medium term. To date, the holding group is supported by global financial institutions with which it works, such as European Investment Bank, DSK Bank, UniCredit Bulbank, UBB AD. 7. CORPORATE SOCIAL RESPONSIBILITY The Company follows a consistent policy of Social Corporate Responsibility. Agria Group Holding AD is a public company and its social responsibility finds expression in all aspects of its corporate activities. The management of Agria Group Holding prioritizes environmental protection and people’s health in its corporate policy through its products, services and working conditions. The company’s social engagements in its capacity of employer toward workers and employees find expression in providing safe and healthy working conditions as well as following an environmental protection policy. Agria’s senior management encourages following business standards and practices for public social responsibility regarding the environmental and employee policies. ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 70 The company assess regularly the impact of its activities on the environment and observe strictly the requirements and regulations for environmental protection, health and safety of the employees and the society in production of grains in the following aspects. Agricultural production is highly dependent on climate change, and at the same time is an important factor, influencing natural and climate conditions. The company has taken the necessary measures and activities to adapt grain production to the changing environment and to have a positive impact on climate change and to promote the sustainable development of agricultural holdings in the holding group. An essential priority of corporate management is environment protection. The company combines social, economic and environmental approaches on the way to achieving sustainable agricultural practices and to the practice of reducing the carbon footprint in grain production. Environmental protection The company develops practices in connection with soil nutrition and production of grains appropriate for particular soil type and adapted to the specifications of the soil. Compliance with the following principles and rules is endorsed when using pesticides. • Use of pesticides’ alternatives; use of selective pesticides, keeping biodiversity and fighting particular wreckers in particular timeframes taking in account the biology life and development; harvest of alternative crops resistant to wreckers; crop rotations; mechanic weed control. • Staff education for using pesticides, observing the quantities recommended by the producers. Pesticides declared by World Health Organization as dangerous are not used. • Storage in original packages in cool and dry places with active ventilation, which can be isolated and marked with appropriate signs. Mixing and moving pesticide can only be performed by educated staff in places with good lightening and ventilation wearing protective clothing/apparel. The access to the premises where the pesticides are stores is strongly restricted. Assessment of the necessity of crop nutrition is made, balancing utilization of food substances, rotating crop sowing, plowing organic waste in the soil; providing buffer zones around the water sources in order to diminish the loss of food substances. In order to prevent loss of genetic resources and in view of providing biodiversity are used plant waste of previous crops for nutritious soil preparation; observation of keeping the eco systems; certified seeds are used. Investments are being made in innovative agricultural machinery, equipped with smart farming software to reduce the use of pesticides and fertilizers. Agricultural equipment for harvesting of cereals is provided with devices for uniform dispersion of the crop residues which are plowed into the soil and thus recovering part of the nutrients in the soil horizon. Burning of vegetable waste is not performed, the use of nitrates is reduced. Health and safety of the staff ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 71 The company follows a consistent policy in order to minimize the risks of: • Physical danger – by qualified and experienced staff for the use of machinery and motor vehicles. • Work in closed spaces – silos, water basins, etc. The access to them is strongly restricted and it is allowed under the supervision of educated staff. • Chemical danger in case of contact with pesticides – a training is conducted for work with pesticides; following the hygiene and safety practices. • Fire and explosions risks – precautions are taken about minimizing the risk of fire in the warehouses for grain storage by using modern and quality production capacity and qualified and experienced staff. • Risk of spread of viruses and infections – the corporate management take precautions and solutions to safeguard the health of the employees and to prevent and limit the spread of viruses and infections. 8. REQUIREMENTS OF THE ACCOUNTANCY ACT FOR DRAWING UP AND PUBLISHING NON-FINANCIAL DECLARATION Requirements of the Accountancy Act for drawing up and publishing non-financial declaration and consolidated non-financial declaration by large enterprises which are public-interest entities in which the average number of employees exceeds 500 for the reporting period. According to the provisions of the Accountancy Act, when enterprises and parent companies of enterprise groups meet certain requirements and criteria, they should draw up and present a non-financial declaration as part of the annual report for the financial year. In particular, the requirements of the law in relation to non- financial declaration are as follows: “ Art. 41. Large enterprises which are public interest enterprises and which, at 31 December of the reporting period, exceed the criterion of the average number of employees during the financial year of 500 people, shall include a non-financial declaration under Article 48 in their report on the operations. ” The Accountancy Act defines criteria for categorization of the enterprises (art. 19) and group of enterprises (art. 21). In addition, according to provision § 4 of the additional provisions of the act, “ Public interest enterprises for the purposes of this Act shall be treated as large enterprises, with the exception of the applicable accounting basis, regardless of the book value of the assets, the net sales revenue and the average number of employees . ” Agria Group Holding AD is a public company which transferable securities – shares are admitted to trading and are traded on a regulated security market. In this capacity, according to the text of § 1 , item 22 of the Additional provisions of the Accountancy Act (the act), for the purpose of the applicable basis of the act, the company is deemed an enterprise of public interest (Public Interest Enterprise). In 2023, on a non-consolidated basis, the company has the following indicators: - Book value of the assets: BGN 194,769,000; ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 72 - Net sales revenue: BGN 561,000, and - Average number of employees (for the reporting year): 8 people. Although the company does not cover the requirements based on quantitative criteria according to the Accountancy Act, for the purpose of application scope of the law and in relation to the requirements for annual closure of accounts for 2023, Agria Group Holding should be considered a large enterprise . In 2023, on a consolidated basis, the group has the following preliminary indicators: - Book value of the assets: BGN 659,973,000; - Net sales revenue: BGN 729,801,000, and - Average number of employees (for the reporting year): 657 people. For the purposes of the application scope of the Act and in relation to the requirements of annual reporting for 2023, at a group level Agria Group Holding should be deemed a large group . Applicability of the requirements of the Accountancy Act for preparing and publishing non-financial declaration and consolidated non-financial declaration by Agria Group Holding AD as part of the annual reporting for 2023 on a non-consolidated and consolidated basis. The requirements, which the Accounting Act prescribes in order to assess whether the requirement for preparation and publishing a non-financial declaration is applicable, are cumulative, namely: • The enterprise/Parent company in a large group/ to be a Public Interest Enterprise and to be a large enterprise/accordingly large group; • As at 31 December (of the corresponding year for which is assessed the presence or absence of a legal obligation) to exceed on an individual, respectively on a consolidated basis, the criteria for average number of employees 500 people. In 2023 on a non-consolidated basis, the company has a number of employees – 8 people, on a consolidated basis – 657 people. Therefore, there is no legal cumulative requirement, respectively as long as the requirements of the law are not covered at an individual level (Art. 41), Agria Group Holding AD is not obliged to prepare and publish as part of the individual activity report for 2023, a non-financial declaration. There is a legal cumulative requirement, respectively as long as the requirements of the law are covered at a consolidated level (Art. 41, Art. 51), Agria Group Holding AD is obliged to prepare and publish as part of the consolidated activity report for 2023, a non-financial declaration. 9. IMPORTANT EVENTS FOR AGRIA GROUP HOLDING AD THAT TOOK PLACE IN THE 2023 FINANCIAL YEAR DATE EVENT ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 73 31.12.2023 1. Agria Group Holding AD has generated consolidated income in the amount of BGN 777,812 thousand which represents an increase of 9.65% of the revenues for 2022. 2. Realized profits on a consolidated basis for 2023 amount to BGN 28,708 thousand. 3. The company’s equity on consolidated basis as at 31.12.2023 is BGN 307,107 thousand and it is with BGN 21,937 thousand more compared to 2022. 22.12.2023 A loan agreement is signed for a loan granting for financing the investment in construction of a new Production plant for oilseed crops processing and production of crude sunflower oil, along with storage silos and oil storage tanks between Agria Group Holding AD’s subsidiary Kristera AD and the European Investment Bank. The new processing plant for crude sunflower oil will be built in the town of Popovo in Northern Bulgaria. It will use waste-free, green technology, generating climate benefits by producing renewable energy based on discarded sunflower seed hulls. The project is expected to become operational in the second half of 2027. It also includes the purchase of railcars to transport the product to Bulgaria’s Black Sea port of Varna, thus cutting greenhouse gas emissions from road freight transport. The project has great regional and economic importance, as it will create a significant number of new jobs, improve and optimise the logistics of raw materials by replacing them with manufactured end products, and lead to substantial economies of scale from a financial and operational management point of view. Waste-free and powered by green technology, the facility will help protect the environment. The loan agreement affirms the EIB’s commitment to supporting food security and sustainable regional development. 20.12.2023 Agria Group Holding AD has reported dividend income from Agria Group Holding AD's subsidiary Agro Oil Konsult OOD in the total amount of BGN 80 000. 14.12.2023 By a resolution of 14.12.2023 the Commission for protection of competition has adopted the following decisions: 1. APPROVES concentration between undertakings to be implented by acquisition by „Agria Group Holding“ AD (UIC 148135254) of sole control over „Komers“ EOOD (UIC 125044589). 2. Gives effect to immediate implementation of the decision under item 1. 29.11.2023 The company presented a quarterly consolidated report for the third quarter of 2023 to the FSC, BSE-Sofia AD and the public. 26.10.2023 The company presented a quarterly non-consolidated report for the third quarter of 2023 to the FSC, BSE-Sofia AD and the public. 09.10.2023 As a result of researches made and preliminary negotiations between "Agria Group Holding" AD and the owner of the capital of the company "Komers" EOOD with UIC 125044589, "Agria Group Holding" AD has made an indicative offer to acquire the ownership of 100% of the shares of the capital of “Komers” EOOD, which has been confirmed by the owner of the shares. "Komers" EOOD is a company developing agribusiness activity through the production of grains (grain and oilseed crops) and trades directly with end consumers (grain traders), representing potential buyers of grain crops. The production and trade of grain and oilseed crops are within the scope of the activities of "Agria Group Holding" AD, as part of the holding’s business model. An investment in the acquisition of shares from the capital of "Komers" EOOD provides a potential for strengthening the market presence of "Agria Group Holding" AD within the main areas of the holding's activities, namely: the company's commercial and export ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 74 activities, by securing grain crops as a raw material for domestic and foreign trade. The expansion of the grain trading bussiness is also beneficial for the supply of the main raw material for the processing part of the holding's activity (processing of oilseeds and other grain crops) for the production of crude and refined sunflower oil and ethanol. The expected positive effects of acquiring the shares of “Komers” EOOD’s capital are in direction of increasing the holding's market presence in grain trade and grain processing, which would lead to a long-term security and sustainability of the company's business model, to better balance of cash flows and added value on a group level. After the successful completion of negotiations, after receiving a resolution from the Commission for Protection of Competition, which allows the sale of shares from the seller to the buyer and after a future authorizing decision from the corporate management of "Agria Group Holding" AD, а possible transaction for acquisition of ownership of 100% of the capital shares of “Komers” EOOD is to be concluded. On 13.10.2023, a notification was submitted to the Commission for Protection of Competition to approve a concentration regarding the acquisition of shares of the capital of “Komers” EOOD. 05.10.2023 In the Commercial Register and Register of Non-Profit Legal Entities at the Registry Agency, the conversion of the single-member joint-stock company "ALMAGEST" EAD with IUC 175340142 (converting company) has entered by change of the legal form in accordance with Article 264 and the following Articles from The Commercial Law, as it has become a commercial company of a different type - from a single-member joint-stock company to a single-member limited liability company (newly established company) "ALMAGEST" EOOD with UIC 207546986, which became the legal successor of the transforming company, which was terminated without liquidation. With the registration of the change of legal form, the rights and obligations of the converting company have passed entirely to the newly established company. 01.10.2023 - 31.12.2023 Pursuant to the Investment Program of the companies in the holding group, during the fourth quarter of 2023, the subsidiaries of Agria Group Holding AD continued the process of expanding their own agricultural land through purchase agreements. The lands purchased are located in the regions where the companies are already cultivating agricultural lands. Due to the usual trading activity of the companies in the holding group, specializing in agricultural production, the fulfilment of the Investment Program of the holding for expanding its agricultural lands leads to consolidation of the total agricultural lands cultivated by the companies in the Group. 01.10.2023 - 31.12.2023 During the fourth quarter of 2023, Agrivia Oil EOOD, a subsidiary of Agria Group Holding AD, handled transactions related to its usual business activities of trading in grain crops and oilseeds and products thereof. 01.10.2023 – 31.12.2023 During the fourth quarter of 2023, Kehlibar EOOD, a subsidiary of Agria Group Holding AD, handled transactions related to its usual business activities of storing, processing and trading in grain crops and oilseeds and products thereof. 01.10.2023 – 31.12.2023 During the fourth quarter of 2023, Kristera AD, a subsidiary of Agria Group Holding AD, handled transactions related to its usual business activities of storing and trading in grain crops and oilseeds and products thereof. 01.10.2023 – 31.12.2023 During the fourth quarter of 2023, Kristera-Agro EOOD, Agro EOOD, Aris Agro EOOD, Toni-M EOOD, Elit-86 EOOD, Gruvar EOOD, Diasvet EOOD, BD Agri EOOD, BD Farm EOOD and Agra EAD, subsidiaries of Agria Group Holding AD, handled transactions related to their usual business activities of producing and trading in grains. 01.10.2023 – 31.12.2023 During the fourth quarter of 2023, Korn Trade EOOD, subsidiary of Agria Group Holding AD, handled transactions related to the export of grain crops with counterparties in the EU. ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 75 28.09.2023 Agria Group Holding AD has presented to the Financial Supervision Commission (FSC), the Bulgarian Stock Exchange AD (BSE) and the public information in accordance with Paragraph 6, Article 19 of Regulation (EU) №596/2014 of the European Parliament and of the Council dated 16th April 2014. 28.09.2023 Agria Group Holding AD has presentd to the Financial Supervision Commission (FSC), the Bulgarian Stock Exchange AD (BSE) and the public information in accordance with Art. 148b of POSA, presented to the company with a notice in accordance with Art.145 of POSA regarding circumstances related to disclosure of shareholding. 28.08.2023 Agria Group Holding AD has presentd to the Financial Supervision Commission (FSC), the Bulgarian Stock Exchange AD (BSE) and the public information in accordance with Art. 148b of POSA, presented to the company with a notice in accordance with Art.145 of POSA regarding circumstances related to disclosure of shareholding. 17.08.2023 The company presented a half-yearly consolidated report for the first half of 2023 to the FSC, BSE-Sofia AD and the public. 24.07.2023 The company presented a half-yearly non-consolidated report for the first half of 2023 to the FSC, BSE-Sofia AD and the public. 13.07.2023 On 13th July 2023 a Construction Permit was issued to Agria Group Holding AD’s subsidiary Kristera AD, for building of the first stage (Oil plant) of the Production plant for processing and storage of oilseed crops and crude oil, within the area of the warehouse facility of Kristera AD in Popovo. The Contruction Permit came into effect on 1st August 2023. 11.07.2023 On 11th July 2023, Agria Group Holding AD declared dividend income from Agria Group Holding AD's subsidiaries Aris Agro EOOD, Kehlibar EOOD, Diasvet EOOD and BD Farm EOOD in the total amount of BGN 7 007 658.11. 01.07.2023 - 30.09.2023 Pursuant to the Investment Program of the companies in the holding group, during the third quarter of 2023, the subsidiaries of Agria Group Holding AD continued the process of expanding their own agricultural land through purchase agreements. The lands purchased are located in the regions where the companies are already cultivating agricultural lands. Due to the usual trading activity of the companies in the holding group, specializing in agricultural production, the fulfilment of the Investment Program of the holding for expanding its agricultural lands leads to consolidation of the total agricultural lands cultivated by the companies in the Group. 01.07.2023- 30.09.2023 During the third quarter of 2023, Agrivia Oil EOOD, a subsidiary of Agria Group Holding AD, handled transactions related to its usual business activities of trading in grain crops and oilseeds and products thereof. 01.07.2023 - 30.09.2023 During the third quarter of 2023, Kehlibar EOOD, a subsidiary of Agria Group Holding AD, handled transactions related to its usual business activities of storing, processing and trading in grain crops and oilseeds and products thereof. 01.07.2023 - 30.09.2023 During the third quarter of 2023, Kristera AD, a subsidiary of Agria Group Holding AD, handled transactions related to its usual business activities of storing and trading in grain crops and oilseeds and products thereof. 01.07.2023 - 30.09.2023 During the third quarter of 2023, Kristera-Agro EOOD, Agro EOOD, Aris Agro EOOD, Toni- M EOOD, Elit-86 EOOD, Gruvar EOOD, Diasvet EOOD, BD Agri EOOD, BD Farm EOOD and Agra EAD, subsidiaries of Agria Group Holding AD, handled transactions related to their usual business activities of producing and trading in grains. 01.07.2023 - 30.09.2023 During the third quarter of 2023, Korn Trade EOOD, subsidiary of Agria Group Holding AD, handled transactions related to the export of grain crops with counterparties in the EU. ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 76 28.06.2023 “Agria Group Holding” AD has disclosed a dividend notice containing the terms and conditions for payment of dividend as follows: The General Meeting of Shareholders of Agria Group holding AD, held on 26 June 2023, adopts a resolution to distribute part of the Company's generated net profit for 2022 amounting to BGN 42 181 441.46 as a cash dividend to the shareholders, as the total amount of the dividend amounts to BGN 6 800 000.00. The persons entitled to receive dividend should be entered in the registers of the Central Depository as holders of dividend rights as of the 14th day following the General Meeting – namely 10 July 2023. Gross amount of dividend per share - BGN 1. Net dividend per share for individual shareholders after deduction of 5% tax - BGN 0.95. Selected commercial bank for dividend payment - UniCredit Bulbank AD. Start date for dividend payment - 21 August 2023. End date for dividend payment - 29 December 2023. The dividend will be paid as follows: for shareholders with customer accounts with investment intermediaries - through the respective investment intermediary; for shareholders without accounts with investment intermediaries - through the branches of UniCredit Bulbank AD in the country until 29 December 2023. 28.06.2023 The Company has presented the minutes of the Ordinary General Meeting of Shareholders of Agria Group Holding AD Varna held on 26 June 2023 to the FSC, BSE- Sofia and the public. 26.06.2023 Ordinary General Meeting of shareholders of Agria Group Holding AD, Varna was held and the following resolutions were passed: 1. The General Meeting approves the audited annual financial statement of the Company for 2022, prepared in accordance with Delegated Regulation (EU) 2019/815 and submitted to the Financial Supervision Commission (FSC), Bulgarian Stock Exchange AD (BSE) and the public; 2. The General Meeting approves the Audited annual consolidated activity report of the Company for 2021, prepared in accordance with Delegated Regulation (EU) 2019/815 and submitted to the Financial Supervision Commission (FSC), Bulgarian Stock Exchange AD (BSE) and the public; 3. The General Meeting of Shareholders adopts a resolution to distribute the Company's generated net profit for 2022 amounting to BGN 42 181 441.46 as a cash dividend to the shareholders, as the total amount of the dividend amounts to BGN 6 800 000.00. The persons entitled to receive dividend should be entered in the registers of the Central Depository as holders of dividend rights as of the 14th day following the General Meeting at which the Annual Financial Statements and the resolution on the distribution of profits are adopted. The General Meeting of Shareholders authorizes the Board of Directors of the Company to take all necessary factual and legal actions regarding the dividend pay-off, including selection of servicing bank, the initial and final date for the payment of the dividend; 4. The General Meeting discharges from liability the members of the Board of Directors of the Company with regard to their activity in 2022; 5. The General Meeting approves the report of the Investor Relations Director of the Company for 2022; 6. The General Meeting approves the report on the activity of the Auditing Committee of the Company for 2022; 7. The General Meeting passes a resolution for election of the Audit Committee of Agria Group Holding AD in the following composition: Simeon Parvanov Milev, Svetla Valentinova Gancheva and Milena Ivanova Gigova; 8. The General Meeting determines a mandate of 1 year for the Audit Committee of Agria Group Holding AD and remuneration of its members as follows: monthly remuneration for The Chairman of the Audit Committee amounting to BGN 1300 and monthly remuneration for all the members of Audit committee amounting to BGN 500; 9. The General Meeting passes a resolution for election of a registered auditor of the Company for 2023 in accordance with the proposal presented by the Auditing Committee; 10.The General Meeting approves the report on the implementation of the Policy for remuneration of ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 77 the members of the Board of Directors of Agria Group Holding AD for 2022; 11. The General Meeting of Shareholders passes a resolution for buy- back of Company’s own shares under the following conditions: – Number of shares subject to buy-back – up to 3% of the total voting shares, issued by the company or up to 204 000 shares. – Minimum buy-back price – BGN 28.00 – Maximum buy-back price – BGN 30.00 – Initial date of buy-back – 30th June 2023 – Final date of buy-back – not later than 30th June 2024 – Payment term of buy-back shares – according to the legislation in force. The General Meeting of Shareholders authorizes the Board of Directors to conduct unlimited procedures for buy-back during the buy-back period; in the term of each procedure, depending on the market conditions, to change under their discretion the buy-back price within the price limits set by the General Meeting of shareholders; to determine an investment broker who shall be assigned to proceed the buy-back order; to determine all remaining parameters of the buy-back and take all necessary factual and legal actions pursuant to the resolution of the General Meeting. Buy-back goal – increase in the liquidity of the Company’s shares; 12. The General Meeting of Shareholders passes a resolution to determine the amount of fixed monthly remuneration of the members of the Board of Directors and the Executive Director as it follows: fixed monthly remuneration of the members of the Board of Directors at the amount of BGN 7 000; fixed monthly remuneration of the Executive Director at the amount of BGN 20 000; 13. The General Meeting of Shareholders passes a resolution on amendments to the Remuneration Policy for the Members of the Board of Directors of Agria Group Holding AD; 14. The General Meeting of Shareholders determines an additional remuneration for 2022 for the members of the Board of Directors in the total amount of up to BGN 1 000 000.00, distributed among the members of the Board of Directors, in accordance with the adopted Remuneration Policy for the members of the Board of Directors of Agria Group Holding AD, together with any adopted amendments thereto, as follows: an additional remuneration for the Chairman of the Board of Directors and CEO Emil Veselinov Raykov, amounting to a maximum amount of BGN 600 000. Additional remuneration to the member of the Board of Directors Stanimir Rusev Buzhev, amounting to a maximum amount of BGN 200 000.00; Additional remuneration to the member of the Board of Directors Anna Dimitrova Belchinska, amounting to a maximum amount of BGN 200 000.00. 12.06.2023 The Company determined the circle of members with voting rights in The Ordinary General Meeting of Shareholders, scheduled for 26 June 2023 based on a list / book of shareholders of the Company, presented by the Central Depository. 23.05.2023 The company presented an invitation for the Ordinary General Meeting of shareholders of Agria Group Holding AD on 26 June 2023 to the FSC, BSE-Sofia AD and the public. 23.05.2023 The company presented an invitation for the Ordinary General Meeting of shareholders of Agria Group Holding AD on 26 June 2023 and the General Meeting materials to the FSC, BSE-Sofia AD and the public. 22.05.2023 The company presented a quarterly consolidated report on the first quarter of 2023 to the FSC, BSE-Sofia AD and the public. 02.05.2023 The Company presented an annual consolidated report for 2022 prepared in accordance with Delegated Regulation (EU) 2019/815 of the Financial Supervision Commission (FSC), the Bulgarian Stock Exchange AD (BSE) and the public. ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 78 24.04.2023 The company presented a quarterly non-consolidated report for the first quarter of 2023 to the FSC, BSE-Sofia AD and the public. 11.04.2023 The Company presented an annual non-consolidated activity report for 2022 prepared in accordance in ESEF form prepared in accordance with Delegated Regulation (EU) 2019/815 to the Bulgarian Stock Exchange AD (BSE) and the public. 27.03.2023 The Company presented an annual non-consolidated report for 2022 in format ESEF to the FSC, BSE-Sofia AD and the public. 27.02.2023 The company presented quarterly consolidated report for the fourth quarter of 2022 to the FSC, BSE-Sofia AD and the public. 08.02.2023 On 8th of February 2023 Agria Group Holding AD concluded final sale-purchase contract of 441,866 ordinary registered dematerialised shares with voting rights from Almagest AD trading company capital, entered in the Commercial Register and in the Register of Legal Entities at the Registry Agency with UIC 175340142, with a nominal value of 80 each, representing 100% of the capital of Almagest AD. On that date, the shares were transferred from the sellers to the buyer by registering the transfer transaction with the Central Depository AD, in accordance with the requirements of the current legislation, and Agria Group Holding AD acquired the ownership of 100% of the shares of the capital of Almagest AD. The shares have been transferred to the buyer, Agria Group Holding AD, free of any third-party liabilities, encumbrances, rights and claims, together with all rights arising from or related to them. The transaction supports the implementation of part of the investment program of the holding in the direction of strengthening Agria Group Holding's presence in the renewable energy market, which is within the scope of the holding's business lines, in accordance with the long-term development strategy. Combining the business potential of Agria Group Holding AD and Almagest AD, would be representing a sustainable foundation for future successful growth and diversification of the business lines developed by the company. There are no related and/or interested parties involved in the future transaction. The transaction does not fall within the scope of Article 114(1) of the Securities Act, as this type of transaction, in accordance with the scope of activity of Agria Group Holding AD, in line with the provision of Article 114(10) of the Securities Act, is in the ordinary commercial activity, representing the sum of actions and transactions performed by the company within the scope of its business activity and in accordance with the ordinary commercial practice. 25.01.2023 The company presented quarterly non-consolidated report for the fourth quarter of 2022 to the FSC, BSE-Sofia AD and the public. 12.01.2023 With resolution of 12.01.2023 the Commission for Protection of Competition adopted the following decisions: 1. APPROVES the concentration between companies to be implemented by acquisition by Agria Group Holding AD (UIC 148135254) of sole control over Almagest AD (UIC 175340142). 2. Immediate implementation of the decision under item 1. 01.01.2023 – 30.06.2023 For the period covering the first half of 2023, Agria Group Holding AD has reported dividend income from its subsidiary Kehlibar EOOD in the amount of BGN 7 800 000. 01.01.2023 – 30.06.2023 Pursuant to the Investment Program of the companies in the holding group, during the first half of 2023, the subsidiaries of Agria Group Holding AD continued the process of expanding their own agricultural land through purchase agreements. The lands purchased are located in the regions where the companies are already cultivating ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 79 Events occurring after the end of the financial 2023 On 23 February 2024 Agria Group Holding AD was entered In the Commercial Register and Register of Non- Profit Legal Entities at the Registry Agency as a sole owner of the capital of Komers EOOD. On 31th of January 2024 Agria Group Holding AD has concluded a contract for the acquisition in the procedure provided for by the legislation (through a contract for the transfer of company shares with notarized signatures and content under Article 129 of the Commercial Law) of the ownership of 100% of the shares of the capital of the trading company Komers EOOD, developing activity in the field of agribusiness, through the production of and trade in grain and oilseed crops in the area of Northeast Bulgaria, coincident with the scope of territory in which the holding companies develop their commercial activity. The expected positive effects from the acquisition of Komers EOOD’s capital shares are directed in strengthening the market presence of Agria Group Holding AD in regard with the main areas of the holding’s activity, namely: trade and export, by securing of grains as raw material for the internal and foreign trade activity. The expansion of the grains trade activity favors as well the supply of the main raw material for the processing line in the holding’s activity (processing of oilseeds and other grain crops) for the production of crude and refined sunflower seed oil and of ethanol. The transaction supports the implementation of part of the holding’s investment program in the direction of increase of the own and leased agricultural land in the areas, where the holding’s agribusiness subsidiaries cultivate agricultural lands, in line with the long-term development strategy. Combining the business potential of Agria Group Holding AD and Komers EOOD, would represent a sustainable foundation for future successful growth of the business lines developed by the company, would lead to a long- term security and sustainability of the company business model, improving regularity of the cash flow and adding value at a group level. agricultural lands. Due to the usual trading activity of the companies in the holding group, specializing in agricultural production, the fulfilment of the Investment Program of the holding for expanding its agricultural lands leads to consolidation of the total agricultural lands cultivated by the companies in the Group. 01.01.2023 – 30.06.2023 During the first half of 2023, Agrivia Oil EOOD, a subsidiary of Agria Group Holding AD, handled transactions related to its usual business activities of trading in grain crops and oilseeds and products thereof. 01.01.2023 – 30.06.2023 During the first half of 2023, Kehlibar EOOD, a subsidiary of Agria Group Holding AD, handled transactions related to its usual business activities of storing, processing and trading in grain crops and oilseeds and products thereof. 01.01.2023 – 30.06.2023 During the first half of 2023, Kristera AD, a subsidiary of Agria Group Holding AD, handled transactions related to its usual business activities of storing and trading in grain crops and oilseeds and products thereof. 01.01.2023 – 30.06.2023 During the first half of 2023, Kristera-Agro EOOD, Agro EOOD, Aris Agro EOOD, Toni-M EOOD, Elit-86 EOOD, Gruvar EOOD, Diasvet EOOD, BD Agri EOOD, BD Farm EOOD and Agra EAD, subsidiaries of Agria Group Holding AD, handled transactions related to their usual business activities of producing and trading in grains. 01.01.2023 – 30.06.2023 During the first half of 2023, Korn Trade EOOD, subsidiary of Agria Group Holding AD, handled transactions related to the export of grain crops with counterparties in the EU. ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 80 There are no related and/or interested parties involved in the transaction. The transaction does not fall within the scope of Article 114(1) of the Securities Act, as this type of transaction, in accordance with the scope of activity of Agria Group Holding AD, in line with the provision of Article 114(10) of the Securities Act, is in the ordinary commercial activity, representing the sum of actions and transactions performed by the company within the scope of its business activity and in accordance with the ordinary commercial practice. The ownership transfer of the capital shares of Komers EOOD is about to be entered in the Commercial register at the Registry agency. The shares are transferred to Agria Group Holding AD free of any third-party liabilities, encumbrances, rights and claims, together with all rights arising from or related to them. On 22 January 2024 Agria Group Holding AD has reported dividend income from the subsidiaries Korn Trade EOOD, Kehlibar EOOD, Bora Energy EOOD, Gruvar EOOD, BD Farm EOOD, Diasvet EOOD, Kristera Agro EOOD and Korn Star OOD in the total amount of BGN 16 603 060.46. 10. INFORMATION ON LARGE TRANSACTIONS ENTERED INTO BETWEEN RELATED PARTIES IN 2023 During the past 2023 financial year Agria Group Holding AD entered into no large transactions with related parties, with the exception of ordinary economic activity transactions. 11. INFORMATION UNDER ART. 187E AND ART. 247 OF THE COMMERCIAL ACT The Company owns 50 000 (fifty thousand) of its own shares representing 0.74% of its capital. No own shares were acquired during the past 2023. Names, functions, remuneration and equity held in other companies of the members of the management and supervisory body Agria Group Holding AD, Varna, has a single-tier management system and is managed and represented by a Board of Directors, which operates under the supervision of the General Meeting. The remunerations of the members of the Board of Directors are determined in accordance with the Remuneration Policy for the members of the Board of Directors of Agria Group Holding AD approved by the General Meeting of Shareholders. The Remuneration policy is endorsed by a resolution adopted on the extraordinary General meeting of shareholders held on 29 September 2020 and was amended by a resolution of the Company's Ordinary General Meeting of Shareholders held on 29 June 2021 and by a resolution of the Company's Ordinary General Meeting of Shareholders held on 26 June 2023. Agria Group Holding AD pays the members of the Board of Directors a regular remuneration which is approved by the General Meeting of Shareholders of the company, taking into account the obligations and the contribution of each members of the Board of Directors to the activity and the results of the company , as well as the opportunity to recruit and retain qualified and loyal members of the Board of Directors and compliance of the interests of the members of the Board of Directors with the longterm interests of the Company to coincide. ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 81 Fixed remuneration is not based on the accomplished results. The amount of the fixed remuneration of the members of the BoD is in line with main activity of AGRIA GROUP HOLDING AD and the income from it, taking into account that as a holding under the meaning of art. 277 and art. 278 of the Commercial Act, the company does not carry out directly a production or trading activity of its own, but depends mainly on the results of the controlled subsidiaries and generates income mainly from dividends from subsidiaries controlled by the company. In view of the financial and economic standing of the Company and the certain input of the members of the Board of Directors of AGRIA GROUP HOLDING AD, during the reporting 2023 the members of the Board of Directors received fixed remunerations, which certain amount was approved by the General Meeting of Shareholders of the Company. The amount of the permanent monthly remuneration of the members of the Board of Directors, until the date of the resolution from Ordinary the General Meeting of Shareholders of AGRIA GROUP HOLDING AD,held on 26 th June 2023 is determined as follows: permanent monthly remuneration of the non-executive members of the Board of Directors in the amount of BGN 7,000; permanent monthly remuneration of the Executive Director in the amount of BGN 20,000. Remunerations for the members of the Board of Directors of AGRIA GROUP HOLDING AD set by the General Meeting of Shareholders, held on 26th June 2023: Position Full monthly remuneration in BGN Executive member of BoD and Executive Director Emil Raykov BGN 20 000 Member of BOD Deyan Ovcharov BGN 7 000 Member of BOD Stanimir Buzhev BGN 7 000 Member of BOD Daniela Taneva BGN 7 000 Member of BOD Anna Belchinska BGN 7 000 For the reporting financial 2023 the following remunerations have been paid from Agria Group Holding AD to the members of the company's Board of Directors. Gross remunerations, received by members of the Board of Directors of Agria Group Holding AD for 2023 from subsidiaries in BGN: 1. ANNA DIMITROVA BELCHINSKA 320 323,82 from Korn Trade EOOD 2. STANIMIR RUSEV BUZHEV 243 655.00 from Kristera AD and Silk Gaz BG TOTAL: 529 648,82 Gross remuneration of the members of the Board of Directors of AGRIA GROUP HOLDING AD for 2023 in BGN: Permanent remuneration Additional remuneration Total remuneration for 2023: ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 82 1. EMIL VESELINOV RAYKOV 180 000,00 600 000,00 780 000,00 2. DEYAN ROSENOV OVCHAROV 66 000,00 66 000,00 3. STANIMIR RUSEV BUZHEV 66 000,00 200 000,00 266 000,00 4. DANIELA DIMITROVA TANEVA 66 000,00 66 000,00 5. ANNA DIMITROVA BELCHINSKA 66 000,00 200 000,00 266 000,00 TOTAL: 444 000,00 1 000 000,00 1 444 000,00 The percentage ratio of the total amount of the permanent remunerations compared to the total amount of the remunerations of the members of the Board of Directors of Agria Group Holding AD for 2023 (constants plus variables) is 22.50%. The percentage ratio of the total amount of variable remuneration compared to the total amount of remuneration of the members of the Board of Directors of Agria Group Holding AD for 2023 (constants plus variables) is 77.50%. Fixed remuneration represents a sufficiently large part of the total remuneration (fixed and variable). Note: The total amount of the additional remuneration of the members of the Board of Directors of the company does not include the payment of the independent directors, whose remuneration is a basic one without additional incentives. Emil Veselinov Raykov holds interests in the following companies as well: - Manager of Bora Invest EOOD, Varna; - Manager of Bora Energy EOOD, Varna; - Manager of AG Property Invest EOOD; - Sole owner and manager of Emra EOOD, Varna; - Executive Director of RR Invest AD; - Member of the Board of Directors of Agra EAD - Member of the Board of Directors and Executive Director of Agri Grain AD - Holder of 223 shares in the capital of Kristera AD, Popovo. Anna Dimitrova Belchinska holds interests in the following companies as well: - Manager of Korn Trade EOOD, Varna. Stanimir Rusev Buzhev holds interests in the following companies as well: - Executive Director of Kristera AD, Popovo. - Executive Director of Kehlibar Pro EAD. Daniela Dimitrova Taneva and Deyan Rosenov Ovcharov are independent members of the BoD within the meaning of POSA. They hold no interests in any form whatsoever neither in companies that are part of the group, nor in any other companies. The members of the BoD may freely acquire shares of the Company, as well as bonds of the Company. No contracts have been entered into with the Company by members of the BoD or related parties that are outside the ordinary operations of the Company or are materially diverging from market conditions. ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 83 Business policy of the Company planned for the next year, including expected investments and personnel development, expected income from investments and development of the Company, as well as forthcoming transactions of material importance for the Company The main objective of the Company is to participate in any form in other commercial companies or in their management. As a holding company, AGRIA GROUP HOLDING AD depends on the activities and results of its subsidiaries. The business policy of the Company, including investments, should be considered mainly in terms of the operations of its subsidiaries. 12. SUMMARY INFORMATION ABOUT IMPLEMENTED AND PLANNED INVESTMENTS AND BASIC TRENDS IN THEIR SPENDING Pursuant to the Investment program for 2023, Agria Group Holding AD has made the following investments: 1. Investments in purchase of agricultural land and acquisition of company equity shares – EUR 26,800,000; 2. Investments in the purchase of agricultural machinery and inventory, transport and logistics – EUR 5,410,000; 3. Investments in storage facilities – EUR 6,010,000; 4. Investments in manufacting industry – EUR 1,960,000. 13. DECLARATION ON CORPORATE GOVERNANCE The Declaration on Corporate Governance aims to present information to the investors and interested parties referring to specific actions and measures undertaken by the management of Agria Group Holding AD for 0 5000 10000 15000 20000 25000 30000 Agricultural land and acquistion of equity shares Agricultural machinery, transport and logistics Storage facilities Manufacting industry Investments in 2023 in BGN thousand ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 84 keeping the basic principles of the National Code for Corporate Governance and good practices in the field of corporate management. The declaration contains information and is based on the principles and norms for good corporate governance regulated by the Bulgarian legislation, laid down in the provisions of the National Code for Corporate Governance, Commercial Law, Law on public offering of securities, Accounting Act, Law on Independent Financial Audit and other laws and regulations and internationally accepted standards in the field of corporate management. In this relation, the requirement under Art. 100n (7) from POSA for the preparation and presentation of a Declaration for corporate governance as part of the Annual report on the operations of the Company for 2023 should be considered fulfilled. In accordance with Art. 100n (8) from POSA the Declaration on corporate governance contains: 1. Information regarding compliance, as appropriate, on part of the issuer Agria Group Holding AD with the National Code for Corporate Governance. 2. Information regarding practices of corporate governance which are applied by the issuer Agria Group Holding AD in accordance with the National Code for Corporate Governance. 3. Description of the main features of the measures for inside control and risk management of the issuer Agria Group Holding AD in relation to the financial reporting process. 4. Information under Directive 2004/25/EO of the European Parliament and the Council from 21 April 2004 referring to take over propositions. 5. The composition and functioning of the administrative and managerial bodies of the issuer Agria Group Holding AD and their Committees. 6. Description of the diversity policy applied by the issuer Agria Group Holding AD to the administrative and managerial bodies in view of age, gender or education and professional experience, the targets of the diversity policy, manner of application and results during the reporting period and in case of non- application of such policy – explanation of the reasons why it is not applied. At a meeting of the Board of Directors of Agria Group Holding AD, Varna, conducted on 19 March 2008, a resolution was passed Agria Group Holding AD, Varna, in its capacity of public company registered for trade on the Parallel market of the Bulgarian Stock Exchange AD, Segment «А», with a BSE code AGR, to accept and follow the National Code for Corporate Governance approved by the Board of Directors of BSE-Sofia AD , by applying and following its main principles. By joining the National Code for Corporate Governance, the Company expresses its engagement in keeping the principles of corporate governance which are part of the document. The Code’s application is based on the principle “observe and explain” which means that the Company observes the Code and in the event of deviation the corporate management of the Company shall clarify the reasons for that. The Company has announced its decision to adopt and comply with the National Corporate Governance Code in FSC’s E-REGISTER system for disclosure of regulated information to the commission by the public companies and ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 85 other issuers of securities, in the EXTRI system used for disclosure and filing information, data and documents to BSE, as well as in the X3News system for disclosure and provision of information to the public. From the date of joining the National Code for Corporate Governance, the Company carries out its activity in accordance with the Code’s principles and decrees by conforming, applying and observing the corporate practices and internationally accepted standards for good corporate management in its activity. This is achieved by applying the principles for timely information disclosure; responsibility, independence and transparency of the activities of the corporate management; protecting shareholders’ rights and equality; respecting the interested parties. The Company has not deviated from the rules and norms in the Code and has observed and applied the good practices and principles of the corporate governance. In accordance with the principle for timely information disclosure, in 2023 the Company disclosed all regulated information in the time and manner provided for in the POSA and its regulations. The corporate management created preconditions for transparency in its relationships with investors, financial media and market analysts. There are rules for inside information and inside persons which regulate the obligations, manner and responsibility for public disclosure of inside information. In the website of the Company a section “For investors” can be found which facilitates the access to timely and up-to- date information for the Company’s investors (shareholders and potential investors), for the financial media and analysts and it also aims to create maximum transparency in their relationship with the management of Agria Group Holding AD. The management of the Company discloses its investment program for each financial year to its investors. Investors receive the information in a timely manner through the website of the company, email and via X3NEWS. The Company identifies as interested parties all persons who have interest in the economic prosperity of Agria Group Holding AD (shareholders, employees, clients, suppliers, banks and the public). The corporate management encourages the partnership between the Company and the interested parties aiming to achieve higher welfare for all parties and in view of the stable development of the Company while balancing the interests of all parties involved. The interested parties are presented with the necessary information regarding the Company’s activities, up -to-date data for its economic and financial condition and any other activity information that contributes for the right orientation and decision-making. In its policy with regard to the interested parties, the Company complies with the legal requirements based on the principles of transparence, accountancy and business ethics. In 2023 the corporate management activity is carried out in compliance with the legal requirements of POSA and its regulations, the Article of Association of the Company, as well as the National Code for Corporate Governance. Agria Group Holding AD is a public company with a single-tier management system. All members of the Board of Directors meet the legal requirements to hold such position, and have the required qualifications, knowledge and experience necessary to fulfil it. The functions and obligations of the corporate management, as well as its structure and competence, comply with the requirements of the Commerce Act, the Articles of Association of the Company, and the Code. The Board of Directors of the Company manages the Company in accordance with the goals and vision established by the Company and the interests of the shareholders. In performing their duties the members of the Board of Directors are guided by the generally accepted principles of integrity, managerial and professional competence, avoid and do not allow a real or potential conflict of interests. The annual report discloses the remuneration of the members of the Board of Directors as determined ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 86 by the General Meeting, and this information is easily available to shareholders. The structure of the Board of Directors guarantees the independent and impartial actions and decisions of its members. The Board of Directors consists of five members, two of whom are independent within the meaning of POSA. The senior management of Agria Group Holding AD, represented by the corporate management, performs a key role and is responsible for the establishment of an internal control system and risk management and carries out routine monitoring in this direction. Agria Group Holding AD applies diversity policy regarding the administrative and managerial bodies of the Company in view of age, gender or education and professional experience. The persons in the administrative and managerial bodies of the issuer possess the required education, professional qualification, competency and experience to conduct the respective activity and meet the requirements of the Commercial Law, POSA and other legal norms and regulations referring to such position and they are selected/respectively hired with no restrictions on age and gender. Through encouraging diversity, the Company reveals its social engagement with the aim for sustainable development while observing the legal requirements. The diversity policy is instrumental in the effective distribution of the functions and obligations of the corporate management while its structure and competency follow the principles of diversification and diversity within the obligatory professional and managerial competence and contributes to the effective operation of the holding structure in the different type of operations of Agria Group Holding AD. As a company carrying out activities in the public interest, in accordance with the Independent Financial Audit Act, Agria Group Holding AD in its capacity of public company, has elected through its competent body (GMS) an Audit Committee, whose members meet the legal requirements for performing this type of activity and whose activity, functions and reporting is in compliance with the decrees of the Independent Financial Audit Act. Guided by the principle of shareholders’ rights’ protection, the corporate management of Agria Group Holding AD guarantees the equal treatment of all the Company’s shareholders (including minority and foreign shareholders) and carries out a policy for protection of rights and assistance to shareholders in exercising their rights by facilitating their effective participation in the work of the General Meetings by means of timely announcement of the materials for the GMS; implementation of clear procedures with regard to the convening and carrying out of General Meetings of Shareholders; preparation of rules regarding the representation of shareholders in the General Meeting; possibility for participation in the distribution of profits by the Company in the event that the General Meeting of Shareholders adopts a specific resolution on the distribution of dividend. Through the Investor Relations Director of Agria Group Holding AD the company pursues its overall policy for assisting shareholders in the exercise of all their rights. Pursuant to the principles of the National Code for Corporate Government and the good practices in the field of corporate governance, the corporate management follows a policy of balanced interaction between shareholders, management and interested parties. ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 87 Agria Group Holding AD has a working system for inside control and risk management in place, which guarantees correct identification of risks related to the Company’s activity and supports their effective management, ensures the adequate functioning of the accountancy and information disclosure systems. Inside control components Control environment Control environment covers the following elements: a) Communication and embracing honesty and ethical values. Embracing honesty and ethical values includes actions on behalf of the management to eliminate or diminish the incentives or temptations, which could suborn the personnel toward dishonest, unlawful or unethical actions. b) Competence. Competence means knowledge and skills necessary to execute the tasks determining the job description of an employee. c) Participation of the persons occupying operative management positions. The persons occupying operative management positions significantly influence control awareness in the company. The responsibilities of the persons working in management include supervision over the design of the model and the effective functioning of the warning procedures and processes for reviewing the efficiency of the Company’s inside control. d) Structure. The establishment of an adequate structure includes taking into consideration the main fields of competence and responsibilities and adequate hierarchy levels of accountancy and reporting. e) Attribution of responsibility and power. Attribution of responsibility and power includes the policy related to the relevant business practices, knowledge and experience of the main personnel and resources provided for performing their duties. It also includes the policies and communications guaranteeing that the personnel understands the goals of the company, understands how each individual’s actions are connected and contribute to these goals as well as who and in what manner is held accountable and responsible. f) Policy and practice related to human resources. The policy and practice related to human resources reveal important questions in view of Company control awareness. The standards for selecting the most qualified individuals – focusing on education, former professional experience, achievements and proof for honesty and ethical conduct, demonstrate the Company’s engagement to employ competent and promising employees. Promotions based on periodic assessments of results show Company’s engagement to promote qualified personnel to more responsible positions. Company’s risk assessment process 2. For the purposes of financial reporting the Company’s risk assessment process includes the manner of business risk identification by the management, which risks are essential for the preparation of a financial statement in accordance with the applicable for the company financial reporting framework; assesses their ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 88 meaning and the likelihood of their occurrence and makes decisions how to meet and manage them and how to evaluate the results. 3. Risk related to dependable financial reporting including outside and inside events, transactions and circumstances, which can occur or have negative effect on the ability of the company to initiate, register, process and report financial data corresponding to the management statements for genuineness in the financial report. Risk can occur or change due to circumstances listed below: • Changes in the operational environment. Changes in legislation or in the operational environment can lead to change in pressure from the competition and different risks. • New personnel. New personnel can have different focus on inside control or different understanding on it. • New or renovated information systems. Substantial or fast changes in the information systems can change internal control related risks. • Fast growth. Substantial and fast expansions of business can limit control and increase the risk for defect in its operation. • New technologies. Introducing new technologies in the production processes or information systems can change internal control risks. • New business models, products and activities. Introducing new business fields or transactions and operations with which the company has little experience, can lead to new risks related to internal control • Corporate reorganization. Reorganization can be followed by cuts in employments and changes in supervision and obligations distribution, which can change internal control risks. • Expanding business abroad. Expansion or acquisition of businesses abroad lead to new and often unique risks which can affect internal control, e.g. additional or changed risks in result of exchange operations. • New accountancy standards and clarifications. Introducing new accountancy principles or changes in the accountancy principles can affect risks related to preparation of the financial statements. The Company has developed information system including related business processes referring to financial reporting and communication. The information system includes infrastructure (physical and hardware components), software, people, procedures and data and actively uses IT. The information system related to financial reporting includes financial reporting system and consists of methods and documentation which: ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 89 • Identify and reflect all valid transactions and operations; • Describe in a timely manner the transactions and operation and detailed enough to allow appropriate classification for the purposes of financial reporting; • Evaluate the transaction and operation in a manner allowing reflection in a fitting money value in the financial report; • Determine the timeframe during which the transactions and operation have arisen so that their reflection in the relevant financial report can be allowed; • Present in a fitting manner the transactions and operation and related disclosure in the financial report. Control measures 4. Control measures related to audit are categorized as policies and procedures and refer to the following : • Reviews on the execution and results. These control measures include reviews and analyses of the actual results in view of budgets, prognoses and results from previous periods; binding different data groups – operational or financial, together with analyses for interconnections and research and corrective measures; comparison of internal data with external sources of information; review on performance results grouped by functions and operations. • Information processing • Physical controls. They include: o Physical security of assets, including measures for safekeeping, e.g. secure facilities and conditions for access to assets and documentation; o Restricted access to computer programs and files; o Periodic amount counting and comparing with the amounts reflected in the control documentation (e.g. comparing the cash counting results and the results from inventories with the accounting documents) Separation of duties. Allocating the responsibilities for transactions and operations approval, registry and responsibility for the assets to different persons. The separation of duties aims to decrease the possibilities for a certain person to be in position to conduct or cover mistakes or fraud in their usual line of duties. Information under Art. 10 Para 1 Letters ‘c’, ‘d’, ‘f’, ‘h’ and ‘i’ from Directive 2004/25/EC of the European Parliament and of the Council dated 21 April 2004 regarding takeover Para. 1, l. ‘c’ “Significant direct and indirect shareholdings (including indirect shareholdings through pyramid structures and cross-shareholdings) within the meaning of Article 85 of Directive 2001/34/EC ” Agria Group Holding AD does not possess direct or indirect shareholdings under Article 85 of Directive 2001/34/EC Para. 1, l. ‘d’ “T he holders of any securities with special control rights and a description of those rights ” ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 90 Agria group Holding AD does not have holders of securities with special control rights. Para. 1, l. ‘f’ “A ny restrictions on voting rights, such as limitations of the voting rights of holders of a given percentage or number of votes, deadlines for exercising voting rights, or systems whereby, with the company’s cooperation, the financial rights attaching to securities are separated from the holding of securities ” There are no restriction on voting rights in Agria Group Holding AD Para. 1, l. ‘h’ “T he rules governing the appointment and replacement of board members and the amendment of the articles of association” The rules governing the appointment and replacement of board members and the amendment of the articles of association are described in the Charter of Agria Group Holding AD Para. 1., l. ‘i’ “T he powers of board members, and in particular the power to issue or buy back shares ” The powers of board members are settled in the Constitution documents of Agria Group Holding AD. 14. ADDITIONAL INFORMATION UNDER APPENDIX NO. 2 TO ARTICLE 10, ITEM 1 OF ORDINANCE NO. 2 OF FSC ON THE PROSPECTUSES FOR PUBLIC OFFERING AND ADMISSION OF SECURITIES TO TRADING ON A REGULATED MARKET The information, in terms of quantity and quality, regarding the main categories of goods, products and/or services provided, as well as in connection with revenue by main types of activities, markets, sources of supply of raw materials, is to be considered in terms of the operations of the Issuer’s subsidiaries, because Agria Group Holding AD functions as a legal entity which is a holding company carrying out investment activities, which aims to manage the stakes it holds in its subsidiaries, and which does not directly carry out any other production and/or commercial activity of its own. Information about the income dispersed by separate activity categories, inside and outside markets • Agribusiness – BGN 63 200 thousand; • Processing industry (storage and grain processing) – BGN 381 400 thousand; • Trading/export operations and services – BGN 682 400 thousand. ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 91 Information on the average production in 2023 of the grain crops harvested by the holding companies - wheat, barley, sunflower and corn. Barley – 8 229 t. Wheat – 50 698 t. Sunflower – 14 503 t. Corn – 15 599 t. Information on the harvested yields per hectare of the crops concerned. Barley - 694 kg/ha Wheat - 699 kg/ha Sunflower - 216 kg/ha Corn/Irrigated corn - 509 kg/ha For the financial year 2023, AGRIA GROUP HOLDING AD has direct investments in the process of execution as follows: Agria Group HoldingAD has acquired in the procedure provided for by the legislation the ownership of 100% (one hundred percent) of the capital of the commercial company "Almagest" AD entered in the Commercial Register and in the register of non-profit organizations at the Registry Agency with UIC 175340142. During the reporting period there were no large transactions and transactions of material importance to the issuer’s operations. Information on the loan agreements indicating conditions under them, concluded by the issuer and its subsidiaries, in their capacity as borrowers, including the deadlines for repayment, as well information provided on guarantees and commitments. Information on loans granted by the issuer and its subsidiaries, providing guarantees or commitments in total to one person or its subsidiary, including related parties, indicating the name and title and UIC of the person, nature of the relationship between the issuer or its subsidiaries and the borrower, the amount of unpaid principal, interest rate, date of conclusion of the contract, deadline for repayment, amount of commitment, specific conditions and the purpose for which they are granted, if concluded as a target. 6% 34% 60% Agribusiness Processing industry Trading/export operations and services ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 92 Loans received 31.12.2023 Company Loan granted from UIC Relationship subsidiary related/UNRELAT ED PARTY Obligation Amount Unpaid Principal Interest Rate Conclusion of contract incl. additional agreements Repayment date Guarantees Earmarked loans (if applicable, specify the purpose for which the loan was granted) specific conditions other than the listed in par. 9 of Appendix 2 to the Ordinance AGRIA GROUP HOLDING AD KRISTERA AD 103273795 RELATED PARTY 10000 3478 5,00% 8.8.2016/02.08.2021/03.01.2023 8.8.2026 TERRA PROTECT EOOD 202946357 RELATED PARTY 400 0 5,00% 10.8.2020/03.01.2023 10.8.2025 ALMAGEST EOOD 207546986 RELATED PARTY 10000 10000 6,00% 15.3.2023 31.12.2024 ALMAGEST EOOD 207546986 RELATED PARTY 3000 181 6,00% 1.12.2023 31.12.2024 AGRA EAD AGRIA GROUP HOLDING AD 148135254 RELATED PARTY 200 200 5,50% 30.6.2023 30.6.2024 SUBSIDIES AGRIA GROUP HOLDING AD 148135254 RELATED PARTY 1000 233 6,00% 22.12.2023 31.12.2028 BD AGRI EOOD 103960661 RELATED PARTY 160 160 5,00% 25.7.2023 31.12.2024 AGRIVIA OIL EOOD АGRO EOOD AGRIA GROUP HOLDING AD 148135254 RELATED PARTY 300 159 5,50% 30.6.2023 30.6.2024 SUBSIDIES AGRIA GROUP HOLDING AD 148135254 RELATED PARTY 1000 369 6,00% 22.12.2023 31.12.2028 ARIS АGRO EOOD AGRIA GROUP HOLDING AD 148135254 RELATED PARTY 100 38 5,50% 30.6.2023 30.6.2024 SUBSIDIES BD AGRI EOOD AGRIA GROUP HOLDING AD 148135254 RELATED PARTY 1000 804 5,50% 30.6.2023 30.6.2024 SUBSIDIES BD FARM EOOD AGRIA GROUP HOLDING AD 148135254 RELATED PARTY 200 82 5,50% 30.6.2023 30.6.2024 SUBSIDIES BORA ENERGY EOOD AGRIA GROUP HOLDING AD 148135254 RELATED PARTY 6500 6500 5,00% 26.5.2016/28.05.2021/01.01.2023 31.5.2026 AGRIA GROUP HOLDING AD 148135254 RELATED PARTY 5000 5000 5,00% 07.03.2022/01.01.2023 31.3.2027 AGRIA GROUP HOLDING AD 148135254 RELATED PARTY 3000 836 5,00% 07.03.2023/03.01.2023 31.3.2028 KRISTERA AD 103273795 RELATED PARTY 200 200 5,00% 31.08.2022/03.01.2023 1.9.2024 KRISTERA AD 103273795 RELATED PARTY 250 250 5,00% 25.11.2022/03.01.2023 31.12.2024 KRISTERA AD 103273795 RELATED PARTY 2000 2000 5,00% 10.1.2023 31.1.2025 KRISTERA AD 103273795 RELATED PARTY 2000 2000 5,00% 1.7.2023 31.7.2025 KRISTERA AD 103273795 RELATED PARTY 2000 906 5,00% 23.10.2023 31.10.2028 BORA INVEST EOOD AGRIA GROUP HOLDING AD 148135254 RELATED PARTY 5000 2542 5,00% 26.2.2016/25.02.2021/03.01.2023 26.2.2026 KRISTERA AD 103273795 RELATED PARTY 1000 1000 5,00% 26.09.2013/23.09.2021/03.01.2023 26.6.2026 KRISTERA AD 103273795 RELATED PARTY 5000 1182 5,00% 1.3.2019/03.01.2023 1.3.2024 GRUVAR EOOD ET KAMEN SHISHKOV 117618493 UNRELATED PARTY 10000 4300 3,20% 04.08.2016/04.08.2021 4.8.2024 0,00% DIASVET EOOD AGRIA GROUP HOLDING AD 148135254 RELATED PARTY 150 13 5,50% 30.6.2023 30.6.2024 SUBSIDIES ELIT 86 EOOD AGRIA GROUP HOLDING AD 148135254 RELATED PARTY 100 19 5,50% 30.6.2023 30.6.2024 SUBSIDIES KEHLIBAR EOOD AG PROPERTY INVEST EOOD KORN TRADE EOOD 103746472 RELATED PARTY 1000 978 5,00% 30.7.2022/03.01.2023 30.7.2024 KRISTERA AD 103273795 RELATED PARTY 2738 2738 5,50% 11.7.2023 31.7.2028 CORN STAR OOD AGRIA GROUP HOLDING AD 148135254 RELATED PARTY 900 704 5,50% 30.6.2023 30.6.2024 SUBSIDIES AGRIA GROUP HOLDING AD 148135254 RELATED PARTY 164 164 5,00% 13.6.2023 31.12.2024 KORN TRADE EOOD N/A 3,00% KRISTERA-AGRO EOOD AGRIA GROUP HOLDING AD 148135254 RELATED PARTY 2240 2044 5,50% 30.6.2023 30.6.2024 AGRIA GROUP HOLDING AD 148135254 RELATED PARTY 5000 4980 5,00% 4.1.2022 31.12.2027 AGRIA GROUP HOLDING AD 148135254 RELATED PARTY 4000 0 31.12.2028 АGRO EOOD 103765583 RELATED PARTY 1000 390 5,00% 10.12.2019/29.12.2020/03.01.2023 31.12.2024 АGRO EOOD 103765583 RELATED PARTY 1000 1000 5,00% 01.08.2022/03.01.2023 31.12.2024 АGRO EOOD 103765583 RELATED PARTY 500 500 5,00% 19.08.2022/03.01.2023 31.12.2024 ELIT - 86 EOOD 124718585 RELATED PARTY 1000 1000 5,00% 01.08.2022/03.01.2023 31.12.2024 ELIT - 86 EOOD 124718585 RELATED PARTY 1000 354 5,00% 22.11.2022/03.01.2023 31.12.2024 GRUVAR EOOD 200673632 RELATED PARTY 10000 4300 5,00% 26.09.2016/05.01.2017/02.01.2018/.02.01.2018/20.12.2021/03.01.2023 31.12.2024 GRUVAR EOOD 200673632 RELATED PARTY 1000 775 5,00% 3.1.2023 31.12.2024 BD FARM EOOD 175429573 RELATED PARTY 4500 3643 5,00% 16.11.2017/16.12.2017/02.01.2018/28.12.2018/27.12.2019/29.12.2020/30.12.2021/03.01.2023 31.12.2024 DIASVET EOOD 117595265 RELATED PARTY 2500 1918 5,00% 01.08.2022/03.01.2023 31.12.2024 AGRA EAD 124690525 RELATED PARTY 4500 3068 5,00% 01.12.2017/02.01.2018/01.09.2018/18.12.2019/14.01.2019/16.12.2019/15.06.2020/30.12.2021/03.01.2023 31.12.2024 AGRA EAD 124690525 RELATED PARTY 2000 2000 5,00% 08.11.2022/03.01.2023 31.12.2024 ARIS-АGRO EOOD 124608460 RELATED PARTY 1300 1300 5,00% 10.04.2020/01.12.2020/03.01.2023 31.12.2024 ARIS-АGRO EOOD 124608460 RELATED PARTY 100 40 5,00% 3.1.2023 31.12.2024 TONI - M EOOD 124620498 RELATED PARTY 2000 1118 5,00% 16.12.2019/03.01.2023 31.12.2024 TONI - M EOOD 124620498 RELATED PARTY 500 434 5,00% 01.08.2022/03.01.2023 31.12.2024 TONI - M EOOD 124620499 RELATED PARTY 500 200 5,00% 18.9.2023 31.12.2023 BD AGRI EOOD 103960661 RELATED PARTY 1500 1500 5,00% 05.05.2020/01.03.2021/03.01.2023 31.12.2024 BD AGRI EOOD 103960662 RELATED PARTY 1100 1100 5,00% 20.06.2022/03.01.2023 31.12.2024 BD AGRI EOOD 103960663 RELATED PARTY 2000 2000 5,00% 28.8.2023 31.12.2024 BD AGRI EOOD 103960663 RELATED PARTY 2000 40 5,00% 10.10.2023 31.12.2028 KRISTERA AD BD FARM EOOD 175429573 RELATED PARTY 5000 0 5,00% 23.12.2021/03.01.2023 31.12.2024 SILK GAZ BG EOOD AGRIA GROUP HOLDING AD 148135286 RELATED PARTY 2000 2000 5,00% 1.3.2022/03.01.2023 1.3.2027 AGRIA GROUP HOLDING AD 148135286 RELATED PARTY 2000 2000 5,00% 20.6.2022/03.01.2023 30.6.2027 AGRIA GROUP HOLDING AD 148135286 RELATED PARTY 2000 632 5,00% 26.7.2022/03.01.2023 31.7.2027 KORN TRADE EOOD 103746472 RELATED PARTY 2000 2000 5,00% 04.03.2022/02.01.2023 31.12.2023 TERRA PROTECT EOOD KRISTERA AD 103273795 RELATED PARTY 400 249 5,00% 2.12.2022 31.12.2024 TONI M EOOD AGRIA GROUP HOLDING AD 148135286 RELATED PARTY 200 57 5,50% 30.6.2023 30.6.2024 SUBSIDIES TONI M EOOD AGRIA GROUP HOLDING AD 148135286 RELATED PARTY 303 303 6% 22.12.2023 31.12.2028 ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 93 Loans granted 31.12.2023 Company Loan granted to UIC Relationship subsidiary/related /unrelated parties Obligation amount Outstanding principal Interest rate Conclusion of contract incl. additional agreements Repayment date Guarantees Earmarked loans (if applicable, specify the purpose for which the loan was granted) specific conditions other than the listed in par. 9 of Appendix 2 to the Ordinance Agria Group Holding AD AGRA EAD 124690525 SUBSIDIARY 200 200 5,50% 30.6.2023 30.6.2024 subsidies AGRA EAD 124690525 SUBSIDIARY 1000 233 6,00% 22.12.2023 31.12.2028 AGRICORN STAR EAD 204462180 UNRELATED PARTY 460 264 5,50% 30.6.2023 30.6.2024 subsidies AGRO EOOD 103765583 SUBSIDIARY 300 159 5,50% 30.6.2023 30.6.2024 subsidies AGRO EOOD 103765583 SUBSIDIARY 1000 369 6,00% 22.12.2023 31.12.2028 ARIS AGRO EOOD 124608460 SUBSIDIARY 100 38 5,50% 30.6.2023 30.6.2024 subsidies BD AGRI EOOD 103960661 SUBSIDIARY 1000 804 5,50% 30.6.2023 30.6.2024 subsidies BD FARM EOOD 175429573 SUBSIDIARY 200 82 5,50% 30.6.2023 30.6.2024 subsidies BORA ENERGY EOOD 202309677 SUBSIDIARY 6500 6500 5,00% 26.5.2016/28.05.2021/01.01.2023 31.5.2026 BORA ENERGY EOOD 202309677 SUBSIDIARY 5000 5000 5,00% 7.3.2022/01.01.2023 31.3.2027 BORA ENERGY EOOD 202309677 SUBSIDIARY 3000 836 5,00% 7.3.2023 31.3.2028 BORA INVEST EOOD 103794531 SUBSIDIARY 5000 2542 5,00% 26.2.2016/25.02.2021/03.01.2023 26.2.2026 GRUVAR EOOD 200673632 SUBSIDIARY 100 0 5,50% 30.6.2023 30.6.2024 subsidies DIASVET EOOD 117595265 SUBSIDIARY 150 13 5,50% 30.6.2023 30.6.2024 subsidies ECO HERBS EAD 204522624 UNRELATED PARTY 50 36 5,50% 30.6.2023 30.6.2024 subsidies ELIT - 86 EOOD 124718585 SUBSIDIARY 100 19 5,50% 30.6.2023 30.6.2024 subsidies KRISTERA-AGRO EOOD 125506526 SUBSIDIARY 2240 2044 5,50% 30.6.2023 30.6.2024 subsidies KRISTERA-AGRO EOOD 125506526 SUBSIDIARY 5000 4980 5,00% 4.1.2022/03.01.2023 31.12.2027 KRISTERA-AGRO EOOD 125506526 SUBSIDIARY 4000 0 5,00% 20.12.2023 31.12.2028 TONI-M EOOD 124620498 SUBSIDIARY 200 57 5,50% 30.6.2023 30.6.2024 subsidies TONI-M EOOD 124620498 SUBSIDIARY 1000 303 6,00% 22.12.2023 31.12.2028 SILK GAS BG EOOD 200491658 SUBSIDIARY 2000 2000 5,00% 1.3.2022/03.01.2023 1.3.2027 SILK GAS BG EOOD 200491658 SUBSIDIARY 2000 2000 5,00% 20.6.2022/03.01.2023 30.6.2027 SILK GAS BG EOOD 200491658 SUBSIDIARY 2000 632000 5,00% 26.7.2022/03.01.2023 31.7.2027 CORN STAR OOD 206566256 RELATED PARTY 900 704 5,50% 30.6.2023 30.6.2024 subsidies CORN STAR OOD 206566256 RELATED PARTY 500 164 5,00% 13.6.2023 31.12.2024 Agra EAD KRISTERA-AGRO EOOD 125506526 RELATED PARTY 4500 3068 5,00% 01.12.2017/02.01.2018/01.09.2018/18.12.2019/14.01.2019/16.12.2019/15.06.2020/30.12.2021/03.01.2023 31.12.2024 KRISTERA-AGRO EOOD 125506526 RELATED PARTY 2000 2000 5,00% 08.11.2022/03.01.2023 31.12.2024 Agro EOOD KRISTERA-AGRO EOOD 125506526 RELATED PARTY 1000 390 5,00% 10.12.2019/29.12.2020/03.01.2023 31.12.2024 KRISTERA-AGRO EOOD 125506526 RELATED PARTY 1000 1000 5,00% 01.08.2022/03.01.2023 31.12.2024 KRISTERA-AGRO EOOD 125506526 RELATED PARTY 500 500 5,00% 19.08.2022/03.01.2023 31.12.2024 ALMAGEST EOOD Agria Group Holding AD 148135254 RELATED PARTY 10000 10000 6,00% 15.3.2023 31.12.2024 Agria Group Holding AD 148135254 RELATED PARTY 3000 181 6,00% 1.12.2023 31.12.2024 Aris Agro EOOD KRISTERA-AGRO EOOD 125506526 RELATED PARTY 1300 1300 5,00% 10.04.2020/01.12.2020/03.01.2023 31.12.2024 KRISTERA-AGRO EOOD 125506526 RELATED PARTY 100 40 5,00% 8.2.2023 31.12.2024 BD Agri EOOD KRISTERA-AGRO EOOD 125506526 RELATED PARTY 1500 1500 5,00% 05.05.2020/01.03.2021/03.01.2023 31.12.2024 KRISTERA-AGRO EOOD 125506526 RELATED PARTY 1100 1100 5,00% 20.06.2022/03.01.2023 31.12.2024 KRISTERA-AGRO EOOD 125506526 RELATED PARTY 2000 2000 5,00% 28.8.2023 31.12.2024 KRISTERA-AGRO EOOD 125506526 RELATED PARTY 2000 40 5,00% 10.10.2023 31.12.2024 Agra EAD 124690525 RELATED PARTY 160 160 5,00% 25.7.2023 31.12.2024 BD Farm EOOD KRISTERA AD 103273795 RELATED PARTY 5000 0 5,00% 23.12.2021/03.01.2023 31.12.2024 KRISTERA-AGRO EOOD 125506526 RELATED PARTY 4500 3643 5,00% 16.11.2017/16.12.2017/02.01.2018/28.12.2018/27.12.2019/29.12.2020/30.12.2021/03.01.2023 31.12.2024 BORA ENERGY EOOD AGRIA GROUP HOLDING AD 148135254 RELATED PARTY 6000 0 5,00% 02.07.2018/03.01.2023 31.12.2023 ENERGY SOLAR TECHNOLOGIES JSC 206589858 RELATED PARTY 200 200 5,10% 11.04.2022/03.01.2023/30.01.2023 1.2.2024 ENERGY SOLAR TECHNOLOGIES JSC 206589858 RELATED PARTY 200 200 5,10% 01.09.2022/03.01.2023 1.9.2024 ENERGY SOLAR TECHNOLOGIES JSC 206589858 RELATED PARTY 2500 2500 5,10% 18.11.2022/03.01.2023 31.12.2024 ENERGY SOLAR TECHNOLOGIES JSC 206589858 RELATED PARTY 250 70 5,10% 1.3.2023 31.12.2024 Bora Invest EOOD 0,00% Gruver EOOD KRISTERA-AGRO EOOD 125506526 RELATED PARTY 10000 4300 5,00% 26.09.2016/05.01.2017/02.01.2018/.02.01.2018/20.12.2021/03.01.23 31.12.2024 KRISTERA-AGRO EOOD 125506526 RELATED PARTY 1000 775 5,00% 3.1.2023 31.12.2024 Diasvet EOOD KRISTERA-AGRO EOOD 125506526 RELATED PARTY 2500 1918 5,00% 01.08.2022/03.01.2023 31.12.2024 Elit 86 EOOD KRISTERA-AGRO EOOD 125506526 RELATED PARTY 1000 1000 5,00% 01.08.2022/03.01.2023 31.12.2024 KRISTERA-AGRO EOOD 125506526 RELATED PARTY 1000 354 5,00% 22.11.2022/03.01.2023 31.12.2024 Kehlibar EOOD 0,00% AG PROPERTY IVEST EOOD AB INVESTMENTS JSG 206405947 UNRELATED PARTY 1476 1476 5,00% 29.3.2022/03.01.2023 31.12.2023 AB INVESTMENTS JSG 206405947 UNRELATED PARTY 978 978 5,00% 12.7.2022/03.01.2023 12.7.2024 AB INVESTMENTS JSG 206405947 UNRELATED PARTY 2738 2738 5,50% 23.05.2023/30.6.2023 16.7.2025 Korn Star OOD Korn Trade EOOD ECO HERBS EAD 204522624 UNRELATED PARTY 1000 0 2,00% 21.2.2022 31.8.2026 ECO HERBS EAD 204522624 UNRELATED PARTY 2000 0 2,00% 30.3.2022 31.8.2026 KRISTERA-AGRO EOOD 125506526 RELATED PARTY 5400 0 3,00% 28.3.2022 31.12.2023 SILK GAS BG EOOD 200491658 RELATED PARTY 2000 2000 5,00% 04.03.2022/02.01.2023 31.12.2023 AG PROPERTY IVEST EOOD 131362354 RELATED PARTY 1000 978 5,00% 30.7.2022/03.01.2023 30.7.2024 Kristera Agro KOMERCE EOOD 125044589 UNRELATED PARTY 5000 5000 5,00% 24.09.2021/03.01.2023 31.12.2026 KOMERCE EOOD 125044589 UNRELATED PARTY 5000 1843 5,00% 01.08.2022/03.01.2023 31.12.2026 ET KAMEN SHISHKOV 117618493 UNRELATED PARTY 10000 4300 3,00% 04.08.2016/04.08.2021 4.8.2024 AGRICORN STAR EAD 204462180 UNRELATED PARTY 4000 4000 5,00% 01.11.2018/10.06.2020/03.01.2023 31.12.2024 AGRICORN STAR EAD 204462180 UNRELATED PARTY 4000 4000 5,00% 02.08.2021/03.01.2023 31.12.2024 AGRICORN STAR EAD 204462180 UNRELATED PARTY 4000 1568 5,50% 25.7.2023 31.12.2025 EKO HERBS EAD 204522624 UNRELATED PARTY 4000 1787 5,00% 15.09.2021/03.01.2023 31.8.2026 Kristera AD AGRIA GROUP HOLDING AD 148135254 RELATED PARTY 10000 3478 5,00% 8.8.2016/02.08.2021/03.01.2023 8.8.2026 KRISTERA-AGRO EOOD 125506526 RELATED PARTY 10000 0 5,00% 3.2.2020/03.01.2023 3.2.2025 BORA INVEST EOOD 103794531 RELATED PARTY 1000 1000 5,00% 26.09.2013/23.09.2021/03.01.2023 26.6.2026 BORA INVEST EOOD 103794531 RELATED PARTY 5000 1182 5,00% 1.3.2019/03.01.2023 1.3.2024 ECO HERBS EAD 204522624 UNRELATED PARTY 6000 3680 5,00% 2.8.2021/03.01.2023 31.8.2026 AGRICORN STAR EAD 204462180 UNRELATED PARTY 1000 1000 5,00% 12.8.2022/03.01.2023 31.8.2027 AGRICORN STAR EAD 204462180 UNRELATED PARTY 4000 4000 5,00% 12.1.2023 31.1.2028 AGRICORN STAR EAD 204462180 UNRELATED PARTY 10000 7250 5,00% 20.2.2023 28.2.2033 AGRICORN STAR EAD 204462180 UNRELATED PARTY 7000 0 5,00% 24.7.2023 31.7.2028 BORA ENERGY EOOD 202309677 RELATED PARTY 200 200 5,00% 31.8.2022/03.01.2023 1.9.2024 BORA ENERGY EOOD 202309677 RELATED PARTY 250 250 5,00% 25.11.2022/03.01.2023 31.12.2024 BORA ENERGY EOOD 202309677 RELATED PARTY 2000 2000 5,00% 10.1.2023 31.1.2025 BORA ENERGY EOOD 202309677 RELATED PARTY 2000 2000 5,00% 1.7.2023 31.7.2025 BORA ENERGY EOOD 202309677 RELATED PARTY 2000 906 5,00% 23.10.2023 31.10.2028 TERRA PROTECT EOOD 202946357 RELATED PARTY 400 249 5,00% 2.12.2022 31.12.2024 KOMERCE EOOD 125044589 UNRELATED PARTY 2000 1942 5,00% 27.6.2023 30.6.2028 AG PROPERTY IVEST EOOD 131362354 RELATED PARTY 2738 2738 5,50% 11.7.2023 31.7.2023 SILK GAS BG EOOD NO 0,00% TERA PROTECT EOOD AGRIA GROUP HOLDING AD 148135254 RELATED PARTY 400 0 5,00% 10.08.2020/03.01.2023 10.8.2025 Toni M EOOD KRISTERA-AGRO EOOD 125506526 RELATED PARTY 2000 1118 5,00% 16.12.2019/19.12.2022/03.01.2023 31.12.2024 KRISTERA-AGRO EOOD 125506526 RELATED PARTY 500 434 5,00% 01.08.2022/03.01.2023 31.12.2024 KRISTERA-AGRO EOOD 125506526 RELATED PARTY 500 200 5,00% 18.9.2023 31.12.2023 ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 94 Transactions with related parties During the past year of 2023 Agria Group Holding AD entered into no large transactions with related parties, with the exception of ordinary economic activity transactions. No related party transactions that are outside the usual scope of activity of the issuer or are materially diverging from market conditions have been entered into. No events or indicators of unusual nature with regard to the issuer exist. There is no off-balance-sheet reporting of transactions of Agria Group Holding AD. Information on the equity stakes held by Agria Group Holding AD in other companies is provided above in the present Activity report. As at 31.12.2023 Agria Group Holding AD has the following liabilities to bank loans in: Company Financing institution Type of loan Currency Authorized amount in KEUR Drawn amount in KEUR - 31.12.2023 Maturity Agria Group Holding DSK Bank Working Capital EUR 22 000 15 625 Nov 2024 Agria Group Holding DSK Bank Working Capital EUR 3 068 2 255 Jun 2024 Agria Group Holding DSK Bank Investment EUR 2 000 48 Jan 2024 Agria Group Holding DSK Bank Investment EUR 2 000 24 Feb 2024 Agria Group Holding DSK Bank Investment EUR 3 068 1 250 Aug 2027 Agria Group Holding Unicredit Investment EUR 3 000 167 Mar 2024 Agria Group Holding Unicredit Investment EUR 3 000 453 Feb 2025 Agria Group Holding Unicredit Investment EUR 2 000 582 Sep 2026 Agria Group Holding Unicredit Investment EUR 8 200 4 110 Oct 2028 Agria Group Holding DSK Bank Investment / Working capital EUR 3 068 2 013 Dec 2026 ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 95 The management of the company’s financial resources is subject to the requirement for achieving maximum effectiveness, while at the same time meeting the terms of payment agreed with suppliers and clients. This includes a balanced approach with regard to own and attracted financial resources, which leads to lower financial costs. The result of such financial resources management policy is the faster reduction of the debt recovery period versus the debt payment period, which maintains a high liquidity of payments. This leads to the effective increase of the cash funds of the company and to the possibility of financing investment costs, without this always being at the expense of a financial resource extended by a bank, which optimises the payment of interest costs. The senior management of Agria Group Holding AD, represented by corporate governance, performs a key role and carries responsibility for the establishment of an internal control system and risk management and carries out routine monitoring in this direction. The company elaborated a risk management and internal audit system. The elected Audit Committee applies the principle of rotation in the election of auditor. In view of the dynamics of the market environment, the risk management system cannot be fully guaranteed, due to which all of the risks, facing any operating company, cannot be completely eliminated. Information about used by the company financial instruments as well as related to them risk management policy is presented in the attachment to the annual financial report of the company. In 2023 the Company has not issued any securities. No change has occurred in the basic management principles of the issuer during the reporting period. There are no arrangements known to the Company, as a result of which future changes may occur in the relative proportion of shares or bonds held by present shareholders or bondholders. As at 31.12.2023 the member of the Board of Directors Anna Dimitrova Belchinska owns 1600 shares from the capital of Agria Group Holding AD. In 2023 there were no changes in the members of the Board of Directors of Agria Group Holding AD. There are no pending judicial, administrative or arbitration proceedings, pertaining to liabilities or receivables of the issuer amounting to at least 10 per cent of its equity. Agria Group Holding Interlease Investment EUR 118 59 Jul 2026 Agria Group Holding Interlease Investment EUR 14 621 13 711 Feb 2030 ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2023 AGRIA GROUP HOLDING JSC 96 INFORMATION IN ACCORDANCE TO ARTICLE 10, ITEM 4 OF ORDINANCE NO. 2 OF FSC Link to the place on the website of the public company where the internal information under Art. 7 of Regulation (EU) № 596/2014 on the circumstances that occurred during the respective six months, or link to the news agency or other media selected by the issuer, through which the company publicly discloses inside information on market abuse (Regulation on market abuse) and repealing Directive 2003/6 / EC of the European Parliament and the Council and Directives 2003/124 / EC, 2003/125 / EC and 2004/72 / EC of the Commission (OJ, L) 173/1 of 12 June 2014) (Regulation (EU) № 596/2014) on the circumstances that occurred during the past year, or an electronic reference to the news agency or other media selected by the issuer through which the company discloses public inside information. The internal information under Art. 7 of Regulation (EU) № 596/2014 on the circumstances that occurred during the past year are available on the website of Extras (www.x3news.com), on the website of the Company (www.agriabg.com), "For investors” section, in the" Financial Statements " submenu and in the "News" section. Investor Relations Director: Teodora Ivanova Ivanova Tel.052/554000; 554014 E-mail t.ivanova@agriabg.com Address: 111 Knyaz Boris I Blvd., fl.9, Varna Emil Raykov – Executive member of the Board of Directors of Agria Group Holding AD of Agria Group Holding AD 97 INFORMATION REGARDING AGRIA GROUP HOLDING AD, VARNA, UNDER SUPPLEMENT No 3 TO Art. 10 FROM ORDINANCE No 2 OF FSC FOR INITIAL AND FOLLOWING DISCLOSURE OF INFORMATION FOR PUBLIC OFFERING OF SECURITIES AND ADMITTING SECURITIES TO TRADING ON A REGULATED MARKET 1. Information regarding securities which were not admitted to trading on a regulated market in the Republic of Bulgaria or another member state The capital of Agria Group Holding AD as at 31 December 2023 is BGN 6,800,000 (six million and eight hundred thousand leva), distributed in 6,800,000 (six million and eight hundred thousand) ordinary, registered, dematerialized, voting shares with par value of BGN 1 (one) each. The subscribed capital of the Company has been fully paid in and has been entered into the Commercial Register of the Registry Agency. The shares in the Company are ordinary, registered, dematerialized, freely transferable conferring the right to 1 (one) vote in the General Meeting of Shareholders, they confer the same rights to their holders and are of one class. Every share confers the right to one vote in the General Meeting of Shareholders in the Company, right to dividend in the distribution of the profit and right to a liquidation share in the event of winding up the Company and liquidation of its property in proportion to its nominal value and the ratio of the share to the overall capital. The shares of the Company are listed on the Main Market Premium Equities Segment of the Bulgarian Stock Exchange AD. The stock exchange ticker symbol attached is AGH. There is no information on securities which are not admitted to trading on a regulated market in the Republic of Bulgaria or another member state. 2. Information concerning the direct and indirect holding of 5 per cent or more of the voting rights in the General Meeting of the company, including details about the shareholders, the extent of their shareholding and the way the shares are held. As at 31 December 2023 the following shareholders hold shares in the capital of Agria Group Holding AD, representing 5 per cent or more of the votes in the General Meeting of Shareholders: Shareholder structure of Agria Group Holding AD as at 31 December 2023 Name/Shareholder’s name Number of shares/votes in GM Percent of capital Emra EOOD Varna 2 955 500 43.46 % of capital Equity Investment EOOD Targovishte 1 695 639 24.94 % of capital Svetlomir Iliev Todorov 697 355 10.26 % of capital Other legal entities and natural persons 1 451 506 21.34 % of capital 98 3 Details about the shareholders enjoying special control rights and description of those rights. The Company has no shareholders enjoying special control rights. 4. Agreements between the shareholders which are known to the Company and which can lead to restrictions regarding transfer of shares or the right to vote. The Company is not aware of agreements between shareholders which can lead to restrictions regarding transfer of shares or the right to vote. 5. Substantial contracts entered into by the Company which give rise to action, undergo changes or are terminated due to a change in control of the Company when having a mandatory tender offering, and the consequences of those, except in the cases when disclosure of such information may cause serious damage to the Company; the exception provided for in the preceding sentence does not apply when the company is obligated to disclose the information by virtue of the law. The Company has not entered into substantial contracts which give rise to action, undergo changes or are terminated due to a change in control of the Company when having a mandatory tender offering. ………………………………………….. For Agria Group Holding AD Emil Raykov – BoD Chairman and Executive Director DECLARATION ON CORPORATE GOVERNANCE AGRIA GROUP HOLDING JSC 100 DECLARATION ON CORPORATE GOVERNANCE The Declaration on Corporate Governance aims to present information to the investors and interested parties referring to specific actions and measures undertaken by the management of Agria Group Holding AD for keeping the basic principles of the National Code for Corporate Governance and good practices in the field of corporate management. The declaration contains information and is based on the principles and norms for good corporate governance regulated by the Bulgarian legislation as laid down in the provisions of the National Code for Corporate Governance, Commercial Law, Law on public offering of securities, Accounting Act, Law on Independent Financial Audit and other laws and regulations and internationally accepted standards in the field of corporate management. In this relation the requirement under Art. 100n (7) from POSA for the preparation and presentation of a Declaration for corporate governance as part of the Annual report on the operations of the Company for 2023 should be considered fulfilled. In accordance with Art. 100n (8) from POSA the Declaration on corporate governance contains: 1. Information regarding compliance, as appropriate, on part of the issuer Agria Group Holding AD with the National Code for Corporate Governance. 2. Information regarding practices of corporate governance which are applied by the issuer Agria Group Holding AD in accordance with the National Code for Corporate Governance. 3. Description of the main features of the measures for inside control and risk management of the issuer Agria Group Holding AD in relation to the financial reporting process. 4. Information under Directive 2004/25/EO of the European Parliament and the Council from 21 April 2004 referring to take over propositions. 5. The composition and functioning of the administrative and managerial bodies of the issuer Agria Group Holding AD and their Committees. 6. Description of the diversity policy applied by the issuer Agria Group Holding AD to the administrative and managerial bodies in view of age, gender or education and professional experience, the targets of the diversity policy, manner of application and results during the reporting period and in case of non-application of such policy – explanation of the reasons why not applied. At a meeting of the Board of Directors of Agria Group Holding AD, Varna, conducted on 19 March 2008, a resolution was passed Agria Group Holding AD, Varna, in its capacity of public company registered for trade on the Parallel market of Segment «А» shares on the Bulgarian Stock Exchange AD with a BSE code AGR, to accept and follow the National Code for Corporate Governance approved by the Board of Directors of BSE-Sofia AD, by applying and following its main principles. By joining the National Code for Corporate Governance the Company expresses its engagement in keeping the principles of corporate governance which are part of the document. The Code’s application is based on the principle “observe and explain” which means that the Company observes the Code and in case of lapse the corporate management of the Company is expected to clarify the reasons for that. 101 DECLARATION ON CORPORATE GOVERNANCE The Company has announced its decision to adopt and comply with the National Corporate Governance Code in FSC’s E-REGISTER system for disclosure of regulated information to the commission by the public companies and other issuers of securities, in the EXTRI system used for disclosure and filing information, data and documents to BSE, as well as in the X3News system for disclosure and provision of information to the public. From the date of joining the National Code for Corporate Governance, the Company carries out its activity in accordance with the Code’s principles and decrees by conforming, applying and observing the corporate practices and internationally accepted standards for good corporate management in its activity. This is achieved by applying the principles for timely information disclosure; responsibility, independence and transparency of the activities of the corporate management; protecting shareholders’ rights and equality; respecting the interested parties. The Company has not deviated from the rules and norms in the Code and has observed and applied the good practices and principles of the corporate governance. In accordance with the principle for timely information disclosure, in 2023 the Company disclosed all regulated information in the time and manner provided for in the POSA and its regulations. The corporate management created preconditions for transparency in its relationship with investors, financial media and market analysts. There are rules for inside information and inside persons which regulate the obligations, manner and responsibility for public disclosure of inside information. In the website of the Company a section “For investors” can be found which facilitates the access to timely and up-to-date information for the Company’s investors (shareholders and potential investors), for the financial media and analysts and also aims to create maximum transparency in their relationship with the management of Agria Group Holding AD. The management of the Company discloses its investment program for each financial year to its investors. Investors receive the information in a timely manner through the website of the company, email and via X3NEWS. The Company identifies as interested parties all persons who have interest in the economic prosperity of Agria Group Holding AD (shareholders, employees, clients, suppliers, banks and the public). The corporate management encourages the partnership between the Company and the interested parties aiming to achieve higher welfare for all parties and in view of the stable development of the Company while balancing the interests of all parties involved. The interested parties are presented with the necessary information regarding the Company’s activities, up -to-date data for its economic and financial condition and any other activity information which contributes for the right orientation and decision making. In its interested parties policy the Company complies with the legal requirements based on the principles of transparence, accountancy and business ethics. In 2023 the corporate management activity is carried out in compliance with the legal requirements of POSA and its regulations, the Article of Association of the Company, as well as the National Code for Corporate Governance. Agria Group Holding AD is a public company with a single- tier management system. All members of the Board of Directors meet the legal requirements to hold such a position, and have the required qualifications, knowledge and experience necessary to fulfil it. 102 DECLARATION ON CORPORATE GOVERNANCE The functions and obligations of the corporate management, as well as its structure and competence, comply with the requirements of the Commerce Act, the Articles of Association of the Company, and the Code. The Board of Directors of the Company manages the Company in accordance with the goals and vision established by the Company and the interests of the shareholders. In their activities the members of the Board of Directors are guided by the generally accepted principles of integrity and managerial and professional competence and avoid and do not allow a real or potential conflict of interests. The annual report discloses the remuneration of the members of the Board of Directors as determined by the General Meeting, and this information is easily available to shareholders. The membership of the Board of Directors guarantees the independent and impartial actions and decisions of its members. The Board of Directors consists of five members, two of whom are independent within the meaning of POSA. Management The Company has a single-tier management system - a Board of Directors. Names, functions and remuneration of the members of the corporate management Agria Group Holding AD, Varna, has a single-tier management system and is managed and represented by a Board of Directors, which operates under the supervision of the General Meeting. The remunerations of the members of the Board of Directors are determined in accordance with the Remuneration Policy for the members of the Board of Directors of Agria Group Holding AD approved by the General Meeting of Shareholders. The Remuneration Policy was adopted by the Extraordinary General Meeting of Shareholders of the company held on 29th September 2020 and was amended by a resolution of an Ordinary General Meeting of Shareholders of the company held on 29th June 2021 and by a resolution of an Ordinary General Meeting of the company held on 26th June 2023. Agria Group Holding AD pays the members of the Board of Directors a regular remuneration which is approved by the General Meeting of Shareholders of the company, taking into account the obligations and the contribution of each members of the Board of Directors to the activity and the results of the company, as well as the opportunity recruit and retain qualified and loyal members of the Board of Directors and compliance of the interests of the members of the Board of Directors with the long-term interests of the Company to coincide. 103 DECLARATION ON CORPORATE GOVERNANCE The fixed remuneration of the members of the Board of Directors of AGRIA GROUP HOLDING AD is not based on the accomplished results. The amount of the fixed remuneration is in line with main activity of AGRIA GROUP HOLDING AD and the income from it, and taking into account that as a holding under the meaning of art. 277 and art. 278 of the Commercial Act, the company does not directly carry out its own production or commercial activity, but the latter depends mainly on the activity and the results of the subsidiary companies it controls, and the income of the company mainly comprise dividends from subsidiaries controlled by the latter. In view of the financial and economic standing of the Company and the certain input of the members of the Board of Directors of AGRIA GROUP HOLDING AD, during the reporting 2023 the members of the Board of Directors received fixed remunerations, which certain amount was approved by the General Meeting of Shareholders of the Company. The amount of the permanent monthly remuneration of the members of the Board of Directors, was determined by a resolution of the Ordinary the General Meeting of Shareholders of AGRIA GROUP HOLDING AD, held on 26th June 2023, is as follows: permanent monthly remuneration of the non-executive members of the Board of Directors in the amount of BGN 7,000; permanent monthly remuneration of the Executive Director in the amount of BGN 20,000. The fixed monthly Remunerations for the members of the Board of Directors of AGRIA GROUP HOLDING AD set by the General Meeting of Shareholders, held on 26 th June 2023: Position Full monthly remuneration in BGN Executive member of BoD and Executive Director Emil Raykov BGN 20 000 Member of BOD Deyan Ovcharov BGN 7 000 Member of BOD Stanimir Buzhev BGN 7 000 Member of BOD Daniela Taneva BGN 7 000 Member of BOD Anna Belchinska BGN 7 000 During the reporting financial year 2023 AGRIA GROUP HOLDING AD have paid to the members of the Board of Directors of AGRIA GROUP HOLDING AD the following gross remuneration. Gross remuneration of the members of the Board of Directors of AGRIA GROUP HOLDING AD received by subsidiaries for 2023 in BGN: 1. ANNA DIMITROVA BELCHINSKA 320 323,82 by KORN TRADE EOOD 2. STANIMIR RUSEV BUZHEV 209 325,00 by KRISTERA AD and SILK GAS BG OOD TOTAL: 529 648,82 Gross remuneration of the members of the Board of Directors of AGRIA GROUP HOLDING AD received by Agria Group Holding AD for 2023 in BGN: 104 DECLARATION ON CORPORATE GOVERNANCE Permanent remuneration Additional remuneration Total remuneration for 2023.: 1. EMIL VESELINOV RAYKOV 180 000,00 600 000,00 780 000,00 2. DEYAN ROSENOV OVCHAROV 66 000,00 66 000,00 3. STANIMIR RUSEV BUZHEV 66 000,00 200 000,00 266 000,00 4. DANIELA DIMITROVA TANEVA 66 000,00 66 000,00 5. ANNA DIMITROVA BELCHINSKA 66 000,00 200 000,00 266 000,00 TOTAL: 444 000,00 1 000 000,00 1 444 000,00 The percentage ratio of the total amount of the permanent remunerations compared to the total amount of the remunerations of the members of the Board of Directors of Agria Group Holding AD for 2023 (constants plus variables) is 22.50%. The percentage ratio of the total amount of variable remuneration compared to the total amount of remuneration of the members of the Board of Directors of Agria Group Holding AD for 2023 (constants plus variables) is 77.50%. Therefore, fixed remuneration represents a sufficiently large part of the total remuneration (fixed and variable). Note: The total amount of the additional remuneration of the members of the Board of Directors of the company does not include the payment of the independent directors, whose remuneration is a basic one without additional incentives. The senior management of Agria Group Holding AD, represented by the corporate management, performs a key role and is responsible for the establishment of an internal control system and risk management and carries out routine monitoring in this direction. Agria Group Holding AD applies diversity policy regarding the administrative and managerial bodies of the Company in view of age, gender or education and professional experience. The persons in the administrative and managerial bodies of the issuer possess the required education, professional qualification, competency and experience to conduct the respective activity and meet the requirements of the Commercial Law, POSA and other legal norms and regulations referring to such position and they are selected/respectively hired with no restrictions on age and gender. Through encouraging diversity, the Company reveals its social engagement with the aim for sustainable development while observing the legal requirements. The diversity policy is instrumental in the effective distribution of the functions and obligations of the corporate management while its structure and competency follow the principles of diversification and diversity within the obligatory professional and managerial competence and contributes to the effective operation of the holding structure in the different type of operations of Agria Group Holding AD. Type of Operations of Agria Group Holding AD Agria Group Holding AD, through its subsidiaries, is engaged in the following types of business: ● Agribusiness in North-Eastern Bulgaria. 105 DECLARATION ON CORPORATE GOVERNANCE ● Processing industry (storage and processing of grain and oil-bearing cultures) centred in the towns of Lyaskovets and Ihtiman. ● Trade/export operations - main administrative and logistic centres – towns of Sofia, Popovo, Devnya, Varna, Dobrich and Ihtiman. As a company carrying out activities in the public interest, in accordance with the Independent Financial Audit Act, Agria Group Holding AD in its capacity of public company, has elected through its competent body (GMS) an Audit Committee, whose members meet the legal requirements for performing this type of activity and whose activity, functions and reporting is in compliance with the decrees of the Independent Financial Audit Act. Guided by the principle of shareholders’ rights’ protection, the corporate management of Agria Group Holding AD guarantees the equal treatment of all the Company’s shareholders (including minority and foreign shareholders) and carries out a policy for protection of rights and assistance to shareholders in exercising their rights by facilitating their effective participation in the work of the General Meetings by means of timely announcement of the materials for the GMS; implementation of clear procedures with regard to the convening and carrying out of General Meetings of Shareholders; preparation of rules regarding the representation of shareholders in the General Meeting; possibility for participation in the distribution of profits by the Company in the event that the General Meeting of Shareholders adopts a specific resolution on the distribution of dividend. Through the Investor Relations Director of Agria Group Holding AD the company pursues its overall policy for assisting shareholders in the exercise of all their rights. Pursuant to the principles of the National Code for Corporate Government and the good practices in the field of corporate governance, the corporate management follows a policy of balanced interaction between shareholders, management and interested parties. 106 DECLARATION ON CORPORATE GOVERNANCE Agria Group Holding AD has a working system for inside control and risk management in place, which guarantees correct identification of risks related to the Company’s activity and supports their effective management, ensures the adequate functioning of the accountancy and information disclosure systems. Inside control components Control environment 1. Control environment covers the following elements: a) Communication and embracing honesty and ethical values. Embracing honesty and ethical values includes actions on behalf of the management to eliminate or diminish the incentives or temptations, which could suborn the personnel toward dishonest, unlawful or unethical actions. b) Competence. Competence means knowledge and skills necessary to execute the tasks determining the job description of an employee. c) Participation of the persons occupying operative management positions. The persons occupying operative management positions significantly influence control awareness in the company. The responsibilities of the persons working in management include supervision over the design of the model and the effective functioning of the warning procedures and processes for reviewing the efficiency of the Company’s inside control. d) Structure. The establishment of an adequate structure includes taking into consideration the main fields of competence and responsibilities and adequate hierarchy levels of accountancy and reporting. e) Attribution of responsibility and power. Attribution of responsibility and power includes the policy related to the relevant business practices, knowledge and experience of the main personnel and resources provided for performing their duties. It also includes the policies and communications guaranteeing that the personnel understands the goals of the company, understands how each individual’s actions are connected and contribute to these goals as well as who and in what manner is held accountable and responsible. f) Policy and practice related to human resources. The policy and practice related to human resources reveal important questions in view of Company control awareness. The standards for selecting the most qualified individuals – focusing on education, former professional experience, achievements and proof for honesty and ethical conduct, demonstrate the Company’s engagement to employ competent and promising employees. Promotions based on periodic assessments of results show Company’s engagement to promote qualified personnel to more responsible positions. Company’s risk assessment process 2. For the purposes of financial reporting the Company’s risk assessment process includes the manner of business risk identification by the management, which risks are essential for the preparation of a financial statement in accordance with the applicable for the company financial reporting 107 DECLARATION ON CORPORATE GOVERNANCE framework; assesses their meaning and the likelihood of their occurrence and makes decisions how to meet and manage them and how to evaluate the results. 3. Risk related to dependable financial reporting including outside and inside events, transactions and circumstances, which can occur or have negative effect on the ability of the company to initiate, register, process and report financial data corresponding to the management statements for genuineness in the financial report. Risk can occur or change due to circumstances listed below: • Changes in the operational environment. Changes in legislation or in the operational environment can lead to change in pressure from the competition and different risks. • New personnel. New personnel can have different focus on inside control or different understanding on it. • New or renovated information systems. Substantial or fast changes in the information systems can change internal control related risks. • Fast growth. Substantial and fast expansions of business can limit control and increase the risk for defect in its operation. • New technologies. Introducing new technologies in the production processes or information systems can change internal control risks. • New business models, products and activities. Introducing new business fields or transactions and operations with which the company has little experience, can lead to new risks related to internal control • Corporate reorganization. Reorganization can be followed by cuts in employments and changes in supervision and obligations distribution, which can change internal control risks. • Expanding business abroad. Expansion or acquisition of businesses abroad lead to new and often unique risks which can affect internal control, e.g. additional or changed risks in result of exchange operations. • New accountancy standards and clarifications. Introducing new accountancy principles or changes in the accountancy principles can affect risks related to preparation of the financial statements. The Company has developed information system including related business processes referring to financial reporting and communication. The information system includes infrastructure (physical and hardware components), software, people, procedures and data and actively uses IT. 108 DECLARATION ON CORPORATE GOVERNANCE The information system related to financial reporting includes financial reporting system and consists of methods and documentation which: • Identify and reflect all valid transactions and operations; • Describe in a timely manner the transactions and operation and detailed enough to allow appropriate classification for the purposes of financial reporting; • Evaluate the transaction and operation in a manner allowing reflection in a fitting money value in the financial report; • Determine the timeframe during which the transactions and operation have arisen so that their reflection in the relevant financial report can be allowed; • Present in a fitting manner the transactions and operation and related disclosure in the financial report. Control measures 4. Control measures related to audit are categorized as policies and procedures and refer to the following: • Reviews on the execution and results. These control measures include reviews and analyses of the actual results in view of budgets, prognoses and results from previous periods; binding different data groups – operational or financial, together with analyses for interconnections and research and corrective measures; comparison of internal data with external sources of information; review on performance results grouped by functions and operations. • Information processing • Physical controls. They include: • Physical security of assets, including measures for safekeeping, e.g. secure facilities and conditions for access to assets and documentation; • Restricted access to computer programs and files; • Periodic amount counting and comparing with the amounts reflected in the control documentation (e.g. comparing the cash counting results and the results from inventories with the accounting documents) • Separation of duties. Allocating the responsibilities for transactions and operations approval, registry and responsibility for the assets to different persons. The separation of duties aims to decrease the possibilities for a certain person to be in position to conduct or cover mistakes or fraud in their usual line of duties. 109 DECLARATION ON CORPORATE GOVERNANCE Information under Art. 10 Para 1 Letters ‘c’, ‘d’, ‘f’, ‘h’ and ‘i’ from Directive 2004/25/EC of the European Parliament and of the Council dated 21 April 2004 regarding takeover Para. 1, l. ‘c’ “S ignificant direct and indirect shareholdings (including indirect shareholdings through pyramid structures and cross-shareholdings) within the meaning of Article 85 of Directive 2001/34/EC ” Agria Group Holding AD does not possess direct or indirect shareholdings under Article 85 of Directive 2001/34/EC Para. 1, l. ‘d’ “T he holders of any securities with special control rights and a description of those rights ” Agria group Holding AD does not have holders of securities with special control rights. Para. 1, l. ‘f’ “A ny restrictions on voting rights, such as limitations of the voting rights of holders of a given percentage or number of votes, deadlines for exercising voting rights, or systems whereby, with the company’s cooperation, the financial rights attaching to securities are separated from the holding of securities” There are no restriction on voting rights in Agria Group Holding AD Para. 1, l. ‘h’ “T he rules governing the appointment and replacement of board members and the amendment of the articles of association” The rules governing the appointment and replacement of board members and the amendment of the articles of association are described in the Charter of Agria Group Holding AD Para. 1., l. ‘i’ “T he powers of board members, and in particular the power to issue or buy back shares ” The powers of board members are settled in the Constitution documents of Agria Group Holding AD. Agria Group Holding AD: Emil Raykov Executive Director 110 REPORT OF THE BOARD OF DIRECTORS OF AGRIA GROUP HOLDING AD ON THE APPLICATION OF THE REMUNERATION POLICY FOR THE COMPANY'S MEMBERS OF THE BOARD OF DIRECTORS, DRAWN UP IN COMPLIANCE WITH THE REQUIREMENTS OF ORDINANCE NO 48 OF THE FINANCIAL SUPERVISION COMMISSION AS OF 20 TH MARCH 2013 ON THE REQUIREMENTS FOR THE REMUNERATIONS, ADOPTED BY A RESOLUTION OF THE EXTRAORDINARY GENERAL MEETING OF THE COMPANY’S SHAREHOLDERS, HELD ON 29 TH SEPTEMBER 2020, AS AMENDED BY A RESOLUTION OF AN ORDINARY GENERAL MEETING OF THE COMPANY’S SHAREHOLDERS HELD ON 29 TH JUNE 2021 AND BY A RESOLUTION OF AN ORDINARY GENERAL MEETING OF THE COMPANY’S SHAREHOLDERS HELD ON 26 TH JUNE 2023. The present report was prepared by the Board of Directors of AGRIA GROUP HOLDING AD in accordance with the provision of Art. 12 (1) and Art.13 of ORDINANCE № 48 of the Financial Supervision Commission of 20 March 2013 on the Requirements for the Remunerations and constitutes a separate document to the company's annual financial statements as at 31.12.2023. The report contains a review of the way in which the Remuneration Policy was enacted during 2023 and herewith is also attached information on the application of the Remuneration Policy for the next financial year. 1. Information about the decision-making process in elaborating the Remuneration policy, including, if applicable, information about the term and members of the Remuneration Committee, the name of the external consultants, whose services have been used in elaborating the Remuneration policy. The Remuneration policy for the members of the Board of Directors of AGRIA GROUP HOLDING AD, as well as any amendments and supplements thereto, is elaborated by the Board of Directors and approved by the General Meeting of Shareholders. Proposals for the adoption of a remuneration policy, respectively for amendments and / or supplements therein or for its revision are included and voted as a separate item on the agenda of the General Meeting of the shareholders of the company. A description and explanation of the significant changes and the way in which the vote results of the General Meeting have been taken into account, the opinions of the shareholders and the minutes of the General Meetings at which the remuneration policy was considered and voted are presented in an Appendix, which is an integral part of the policy, containing a Protocol for amendments or supplements to the remuneration policy. The present Policy was developed by the Company's Board of Directors in accordance with the procedure for adoption of decisions by the corporate board set out in the Company's Articles of Association. Pursuant to the regulatory requirements, the Policy was adopted by the Extraordinary General Meeting of Shareholders of AGRIA GROUP HOLDING AD, held on 29 th September 2020 and was amended by a resolution of an Ordinary General Meeting of Shareholders of Agria Group Holding AD held on 29 th June 2021 and by a resolution of an Ordinary General Meeting of Shareholders of Agria Group Holding AD held on 26 th June 2023. All legal requirements and recommendation of the National Corporate Governance Code were taken into account in the development of the Remuneration policy for the members of the Board of Directors of AGRIA GROUP HOLDING AD. Under the Remuneration policy in force for the members of the Board of Directors of AGRIA GROUP HOLDING AD, the company has not set up a remuneration committee. When developing the Remuneration policy, the Board of Directors of AGRIA GROUP HOLDING AD have not used external consultants. The Remuneration policy for the members of the Board of Directors of AGRIA GROUP HOLDING AD aims to provide objective criteria for determining the corporate board's remuneration of the company with a view to attracting and retaining qualified and loyal members of the board and motivating them to work for the benefit of the company and its shareholders, as to avoid potential and actual conflicts of interest. 111 During the reporting financial year AGRIA GROUP HOLDING AD has implemented the Remuneration policy for the members of the Board of Directors pursuant to the regulatory requirements for public companies, the objectives, long-term interests and development strategy of the company, as well as its financial and economic standing in the context of the national and European economic environment, as taking into account the recommendations of the National Corporate Governance Code. AGRIA GROUP HOLDING AD has disclosed the Remuneration policy for the members of the Board of Directors through publishing it on the corporate website of the company. 2. Information about the relative weight of the variable and fixed remuneration of the members of management and controlling bodies Pursuant to the Remuneration policy in force for the members of the Board of Directors of AGRIA GROUP HOLDING AD, during the reporting financial year the Company paid to the members of the Board of Directors fixed remuneration, which certain amount has been approved by the General Meeting of Shareholders of the Company and considered: 1.1. The obligations and contribution of each member of the Board of Directors in the operations and results of the company; 1.2. The opportunity of recruiting and retaining qualified and loyal members of the Board of Directors; 1.3. Compliance of the interests of the Board members with the long-term interests of the company. The fixed remuneration of the members of the Board of Directors of AGRIA GROUP HOLDING AD is not based on the accomplished results. The volume of the fixed remuneration is in line with main activity of AGRIA GROUP HOLDING AD and the income from it, and taking into account that as a holding under the meaning of art. 277 and art. 278 of the Commercial Act, the income of the company mainly comprise dividents from subsidiaries controlled by the latter. In view of the financial and economic standing of the Company and the certain input of the members of the Board of Directors of AGRIA GROUP HOLDING AD, during the reporting 2023 the members of the Board of Directors received fixed remunerations, which certain amount was approved by the General Meeting of Shareholders of the Company. The amount of the permanent monthly remuneration of the members of the Board of Directors, was determined by a resolution of the Ordinary the General Meeting of Shareholders of AGRIA GROUP HOLDING AD, held on 26 th June 2023, is as follows: permanent monthly remuneration of the non-executive members of the Board of Directors in the amount of BGN 7,000; permanent monthly remuneration of the Executive Director in the amount of BGN 20,000. Remunerations for the members of the Board of Directors of AGRIA GROUP HOLDING AD set by the General Meeting of Shareholders, held on 26th June 2023: Position Full monthly remuneration in BGN Executive member of BoD and Executive Director Emil Raykov BGN 20 000 Member of BOD Deyan Ovcharov BGN 7 000 Member of BOD Stanimir Buzhev BGN 7 000 Member of BOD Daniela Taneva BGN 7 000 Member of BOD Anna Belchinska BGN 7 000 112 During the reporting financial year 2023 AGRIA GROUP HOLDING AD have paid to the members of the Board of Directors of AGRIA GROUP HOLDING AD the following gross remuneration. Gross remuneration of the members of the Board of Directors of AGRIA GROUP HOLDING AD received by subsidiaries for 2023 in BGN: 1. ANNA DIMITROVA BELCHINSKA 320 323,82 by KORN TRADE EOOD 2. STANIMIR RUSEV BUZHEV 209 325,00 by KRISTERA AD and SILK GAS BG OOD TOTAL: 529 648,82 Gross remuneration of the members of the Board of Directors of AGRIA GROUP HOLDING AD received by Agria Group Holding AD for 2023 in BGN: Permanent remuneration Additional remuneration Total remuneration for 2023.: 1. EMIL VESELINOV RAYKOV 180 000,00 600 000,00 780 000,00 2. DEYAN ROSENOV OVCHAROV 66 000,00 66 000,00 3. STANIMIR RUSEV BUZHEV 66 000,00 200 000,00 266 000,00 4. DANIELA DIMITROVA TANEVA 66 000,00 66 000,00 5. ANNA DIMITROVA BELCHINSKA 66 000,00 200 000,00 266 000,00 TOTAL: 444 000,00 1 000 000,00 1 444 000,00 The percentage ratio of the total amount of the permanent remunerations compared to the total amount of the remunerations of the members of the Board of Directors of Agria Group Holding AD for 2023 (constants plus variables) is 22.50%. The percentage ratio of the total amount of variable remuneration compared to the total amount of remuneration of the members of the Board of Directors of Agria Group Holding AD for 2023 (constants plus variables) is 77.50%. Therefore, fixed remuneration represents a sufficiently large part of the total remuneration (fixed and variable). Note: The total amount of the additional remuneration of the members of the Board of Directors of the company does not include the payment of the independent directors, whose remuneration is a basic one without additional incentives. 3. Information about the criteria for accomplished results, based on which, stock options, stocks of the Company or other types of variable remuneration are provided and an explanation how the criteria under Art. 14, Para 2 and 3 from Ordinance № 48 contribute to the long-term interests of the Company The Remuneration policy for the members of the Board of Directors of AGRIA GROUP HOLDING AD does not provide an option for granting company stocks, stock options and other appropriate financial instruments. The Remuneration policy of AGRIA GROUP HOLDING AD provide an option for additional variable remuneration to the members of the Board of Directors of Agria Group Holding AD. The total amount of the additional variable remuneration to the members of the Board of Directors (except for the independent directors who receive only base remuneration without additional incentives) is determed with a view to the financial- econonomic standing of the company, the input of the members of the Board of Directors and the accomplished results. 113 The criteria for achieved results are subject to encourage the stability of the Company in the long term and to also include non-financial indicators, which are essential for the long-term activity of the Company, for example compliance with the applicable rules and procedures. 4. Clarifications regarding the applied methods for assessment whether the criteria for accomplished results have been achieved According to the Remuneration policy for the members of the Board of Directors of AGRIA GROUP HOLDING AD, the members of the Board of Directors of Agria Group Holding AD can receive additional variable remunerations, which total amount depends on the financial-economic standing ot the company, the input of the members of BoD and the accomplished results of the activity. The variable remuneration is determined by the accomplished results of the activity on a consolidated basis. The total amount of the additional remuneration of the members of the Company’s Board of Directors (with the exception of th e independent directors, whose remuneration is only fixed without additional incentives) is no more than 3% (three percent) of the net consolidated profit of Agria Group Holding AD for the corresponding financial year. The amount of the additional remuneration proposed as a maximum is based on the consolidated financial results, as the holding company does not directly engage in commercial activities but depends on the activity and results of its subsidiaries. The variable remuneration of the members of the Board of Directors is accrued and paid in compliance with financial and non-financial criteria for achieved results. The criteria for achieved results should promote the long-term stability of the company and include non-financial indicators that are relevant for the long-term activity of the company, such as compliance with applicable rules and procedures. The criteria related to financial indicators are selected in accordance with how they reflect the creation of value by the Company and how this relates to the market capitalization. Financial indicators may include criteria related to consolidated profit before taxes, interest and depreciation, growth in consolidated income, consolidated profit, efficiency and value of new business. The non-financial criteria are related to the clients egagements and employees of the company, operational efficiency and corporate social responsibility, contributing to the stable and sustainable development of the Company and the holding group in economic, social and environmental aspects. The regular remuneration must represent a sufficiently large proportion of the total remuneration so as to allow the company to apply a flexible policy on variable remuneration, including the option not to pay when the criteria for achieved results are not met and where there is a significant deterioration in the company's financial situation. 5. Clarification regarding the correlation between the remuneration and the accomplished results During the reporting financial year 2023 AGRIA GROUP HOLDING AD have paid additional remuneration to the Executive director in the amount of BGN 600 000.00 which amount of additional remuneration was determined by the General Meeting of Shareholders held on 26 th June 2023. The variable remuneration is formed on the basis of achieved consolidated financial results, as the holding company does not perform direct commercial activity as it depends on the activity and results of its subsidiaries, subject to the upper limit of not more than 3% (three percent) of net consolidated profit for the financial year 2022 of Agria Group Holding AD. 114 6. Base remunerations and justification of the annual scheme for bonus payments and/or all other non- monetary additional remunerations The General Meeting of Shareholders convened on 16 July 2014, the General Meeting of Shareholders convened on 16 July 2015, the General Meeting of Shareholders convened on 22 June 2016, the General Meeting of Shareholders convened on 27 June 2017, the General Meeting of Shareholders convened on 25 June 2018, the General Meeting of Shareholders convened on 19 June 2019 and the General Meeting of Shareholders convened on 29 July 2020, the General Meeting of Shareholders convened on 29 June 2021, the General Meeting of Shareholders convened on 28 th June 2022 and the General Meeting of Shareholders convened on 26 th Juny 2023 did not determine additional remuneration to the members of the Board of Directors of AGRIA GROUP HOLDING AD through payment of bonuses and/or other non-monetary additional remunerations to the members of the company's corporate board. 7. Description of the main characteristics of the scheme for additional voluntary retirement insurance and information about the paid and/or due contributions by the Company in favor of the Director for the respective financial year, when applicable In terms of members of the Board of Directors of AGRIA GROUP HOLDING AD, there is no commitment on the part of the company in respect of additional voluntary pension insurance for board members and the company does not have liabilities for payment of contributions in favour of the directors for the reporting financial year. 8. Information regarding the deferment period for payment of variable remunerations The option for deferred payment of variable remunerations is in accordance with the mandatory provisions of the regulatory framework in force. 9. Information about the compensation policy upon contract termination Under the Remuneration policy of Agria Group Holding AD, the maximum amount of compensation payable by the company, other than the compensation payable by law (where applicable) in event of early termination of the contract with a member of the Board of Directors of Agria Group Holding AD, representing the company according to an entry in the Commercial Register at the Registry Agency, may not exceed the total amount of gross monthly remuneration payabe to them for the remainder of the period, but not more than 12 months. The amount of the compensation shall be fixed in the contract or an agreement between the parties and shall not exceed the amount specified in Remuneration policy. The Company is not liable for compensation in event of termination of a contract with a member of the Board of Directors of Agria Group Holding AD due to expiration and non-renewal of the term the member was elected for. The Company is not liable for compensetaion in event of early termination of the contract with a member of the BoD of Agria Group Holding AD due to failure to comply with the clause, which forbids the carry out of a competitive activity, or other failure to fulfill an obligation under the contract with a member of the BoD of the Company. During the reporting financial 2023 year a contract with a member of the Board of Directors has not been terminated. 10. Information about the period, during which the stocks cannot be transferred and the options on stocks cannot be exercised, concerning variable remuneration, based on stocks The current Remuneration policy for the members of the Board of Directors of AGRIA GROUP HOLDING AD does not provide such option. 115 11. Information about the policy for retaining a definite number of shares until the end of the term of the members of the management and controlling bodies after expiration of the period under item 10 The Remuneration policy in force for the members of the Board of Directors of AGRIA GROUP HOLDING AD does not provide such option. 12. Information about the contracts of the members of the management and controlling bodies, including the term of each contract, the notice period for termination and details regarding the compensations and/or other due payments in the event of early termination The Contracts with all members of the Board of Directors are entered for a period of five years as of July 2020. Information on compensations and/or other payments due in the event of early termination are presented in Item 9 of the present Report 13. Full amount of the remuneration and other incentives of the members of the management and controlling bodies for the respective financial year For 2023 the following remunerations have been calculated from Agria Group Holding AD to the members of the company's Board of Directors: Position gross annual remuneration in BGN for 2023 Executive member of BoD and Executive Director Emil Raykov BGN 180 000 Member of BOD Deyan Ovcharov BGN 66 000 Member of BOD Stanimir Buzhev BGN 66 000 Member of BOD Daniela Taneva BGN 66 000 Member of BOD Anna Belchinska BGN 66 000 During the reporting financial year 2023 AGRIA GROUP HOLDING AD have paid additional remuneration for 2022 to the members of the Board of Directors in total amount of BGN 1 000 000.00 divided between the members of the Board of Directors in accordance with the adopted Remuneration Policy for the members of the Board of Directors of Agria Group Holding AD along with all adopted amendments of the latter, as follows: additional remuneration of the Chairman of the Board of Directors and Executive Director Emil Veselinov Raykov in amount of BGN 600 000,00; additional remuneration of the member of the Board of Directors Stanimir Rusev Buzhev in amount of BGN 200 000,00; additional remuneration of the member of the Board of Directors Anna Dimitrova Belchinska in amount of BGN 200 000,00. 14. Information about the remuneration of each person, who has been a member of a management or controlling body of a public company for a certain period in the respective financial year: a) full amount of the paid and/or accrued remuneration of the person for the respective financial year For 2023 the following remunerations have been calculated from Agria Group Holding AD to the members of the company's Board of Directors: Position Gross annual remuneration in BGN for 2023 Executive member of BoD and Executive Director Emil Raykov BGN 180 000 116 Member of BOD Deyan Ovcharov BGN 66 000 Member of BOD Stanimir Buzhev BGN 66 000 Member of BOD Daniela Taneva BGN 66 000 Member of BOD Anna Belchinska BGN 66 000 During the reporting financial year 2023 AGRIA GROUP HOLDING AD have paid additional remuneration for 2022 to the members of the Board of Directors in total amount of BGN 1 000 000.00 divided between the members of the Board of Directors in accordance with the adopted Remuneration Policy for the members of the Board of Directors of Agria Group Holding AD along with all adopted amendments of the latter, as follows: additional remuneration of the Chairman of the Board of Directors and Executive Director Emil Veselinov Raykov in amount of BGN 600 000,00; additional remuneration of the member of the Board of Directors Stanimir Rusev Buzhev in amount of BGN 200 000,00; additional remuneration of the member of the Board of Directors Anna Dimitrova Belchinska in amount of BGN 200 000,00. In 2023 members of the Company' s Board of Directors have not received non-monetary benefits. The company does not have deferred or contingent liabilities arising during the year, even if the remuneration is due at a later stage As of 31.12.2023 AGRIA GROUP HOLDING AD does not owe amounts for payment of pensions or retirement benefits. b) remuneration and other material and non-material incentives received by the person from companies belonging to the same group Name Position gross remuneration in BGN for 2023 Anna Belchinska Manager of Korn Trade EOOD 320 323.82 Stanimir Buzhev Executive Director of Kristera AD 209 325.00 c) remuneration received by the person in the form of distribution of profit and/or bonuses and the reasons for their payment In 2023 no member of the Board of Directors of AGRIA GROUP HOLDING AD has received remuneration from the Company in the form of profit distribution and/or other bonuses from AGRIA GROUP HOLDING AD. d) any additional payments for services provided by the person beyond his usual functions when such payments are permitted under contract concluded with him The contracts with the members of the Board of Directors of AGRIA GROUP HOLDING AD do not provide payment for services beyond their usual functions. e) paid and/or accrued compensation on the occasion of termination of duties during the past financial year In 2023 compensations have not been paid and/or accrued on the occasion of termination of the functions of the Board of Directors of AGRIA GROUP HOLDING AD. f) overall assessment of all non-cash benefits, treated as remuneration, except for those pointed out under letters “a” - “e” 117 In 2023 none of the member of the Board of Directors of AGRIA GROUP HOLDING AD has received non- cash benefits treated as remuneration than those specified under letters “a” – “e”. g) information on all loans granted, payments of welfare costs and guarantees on the part of the company or its subsidiaries or other companies subject to consolidation in the annual financial statements, including data on the remaining outstanding part and the interest As of the end of 2023, there are no active and unpaid cash loans from members of the Board of Directors of the company. In 2023, in respect of all of the members of the Board of Directors of AGRIA GROUP HOLDING AD, owes no payments of social and household expenses and guarantees from the company or its subsidiaries or other companies that are subject to consolidation in the annual his financial statement. 15. Information about stocks and/or stock options and/or other incentive schemes based on stocks: The Remuneration policy in force for the members of the Board of Directors of AGRIA GROUP HOLDING AD does not provide an option for granting stock options, company shares or other types of incentive schemes based on stock for members of the corporate board, respectively, such have not been paid or provided. 16. Annual change in the remunerations, the results of the company and the average volume of the remunerations of full-time employees, who are not directors, during the last at least 5 financial years, presented altogether in a way that can be compared 17. Information on exercising the option to request a refund of the variable remuneration The Company applies a flexible policy on variable remuneration, including exercising the option for the same to be refunded, when there is no compliance with the clause prohibiting the carry out of competition, due to other culpable failure to comply with the provisions of the management contract by a member of the Board, including significant deterioration of the financial situation of the company as a result of actions and transactions by a member of the Board of Directors, which significantly deviate from the market conditions, as well as actions of any nature harmful to the company. 18. Information on any deviations from the procedure for the implementation of the remuneration policy in connection with exceptional circumstances referred to in Article 11, para 13, including the explanation of the nature of the exceptional circumstances and the indication of the specific elements derogated from. During 2023 there are no exceptional circumstances in which the company has temporarily suspended the implementation of the Remuneration policy. Year Number of persons 2018 2019 Change 2019 compared to 2018 % 2020 Change 2020 compared to 2019 % 2021 Change 2021 compared to 2020 % 2022 Change 2022 compared to 2021 % 2023 Change 2023 compared to 2022 % Gross remuneration of all members of the BoD for the year 5 216 000,00 216 000,00 0,00% 216 000,00 0,00% 564 000,00 161,11% 812 000,00 43,97% 1 437 781,04 77,07% Average remuneration of a member of the BoD per year 5 43 200,00 43 200,00 0,00% 43 200,00 0,00% 112 800,00 161,11% 162 400,00 43,97% 287 556,21 77,07% Company results - profit х 1 839 640,29 628 057,65 -65,86% 2 016 819,99 221,12% 2 086 000,43 3,43% 42 181 441,46 1922,12% 8 839 343,03 -79,04% Gross remuneration on the basis of full time employees in the company who are not directors for the year 11 336 509,95 339 154,92 0,79% 136 526,78 -59,75% 157 949,18 15,69% 223 300,46 41,37% 326 051,71 46,01% Average remuneration on a full-time basis of employees in the company who are not directors for the year 11 48 072,85 48 450,70 0,79% 19 503,83 -59,75% 15 794,92 -19,02% 22 330,05 41,37% 32 605,17 46,01% 118 Information on application of the Remuneration Policy of the members of the Board of Directors of AGRIA GROUP HOLDING AD for the next financial year As of the date of preparation of the present report the Board of Directors of Agria group holding AD has not observed a need to adopt any amendments to the Remunartion policy for the members of the Board of Directors, adopted and endorsed by the General Meeting of the company. The Board of Directors shall discuss the Remunaration policy at a session and propose amendments to it, if deemed necessary, at the forthcoming annual General Meeting of shareholders in 2024. ………………………………………………. Emil Raykov – executive member of the Board of Directors Of Agria Group Holding AD 0 CONSOLIDATED NON-FINANCIAL DECLARATION FOR 2023 Part of the Consolidated Financial Statement of Agria Group Holding JSC 120 CONTENTS I. INTRODUCTION............................................................................................................................... 1 1. BACKGROUND................................................................................................................................. 1 2. SUMMARY....................................................................................................................................... 1 II. ABOUT US ....................................................................................................................................... 1 1. ACTIVITIES ....................................................................................................................................... 2 2. PRODUCTS ...................................................................................................................................... 3 3. OUR BUSINESS MODEL ................................................................................................................... 3 4. CUSTOMERS .................................................................................................................................... 4 5. SUPPLIERS ....................................................................................................................................... 4 III. MATERIAL TOPICS AND RELATED RISKS.......................................................................................... 5 IV. ENVIRONMENT................................................................................................................................ 7 V. SOCIAL RESPONSIBILITY ................................................................................................................ 13 1. SAFE WORKING CONDITIONS ....................................................................................................... 13 2. EMPLOYEE RIGHTS ........................................................................................................................ 15 3. DIVERSITY...................................................................................................................................... 17 4. LOCAL COMMUNITIES .................................................................................................................. 20 5. PRODUCT SAFETY ......................................................................................................................... 21 VI. GOVERNANCE............................................................................................................................... 22 VII. DISCLOSURES ON ENVIRONMENTALLY SUSTAINABLE ECONOMIC ACTIVITIES ........................... 22 1. BACKGROUND............................................................................................................................... 22 2. CONCLUSIONS FROM OUR ELIGIBILITY AND ALIGNMENT ANALYSIS ........................................... 24 3. ACCOUNTING ................................................................................................................................ 24 4. KPIS CALCULATIONS – TURNOVER, CAPEX, OPEX ....................................................................... 25 APPENDIX I ............................................................................................................................................ 26 APPENDIX II ........................................................................................................................................... 27 APPENDIX III .......................................................................................................................................... 28 APPENDIX IV .......................................................................................................................................... 29 1 I. INTRODUCTION 1. BACKGROUND This Non-Financial Declaration has been prepared pursuant to Article 41 of the Accountancy Act and complies with the requirements of Articles 48 - 52 thereof. 2. SUMMARY The Non-Financial Declaration has been prepared on a consolidated level and accordingly includes information on Agria Group Holding AD and its subsidiaries within the scope of the Consolidated Financial Statement for the period 1 January 2023 - 31 December 2023. It presents information on material environmental and social topics for all companies in the scope. The disclosures follow the principles of relevance, reliability, usefulness and verifiability of the information. Since 2023 is the first year of non-financial reporting for Agria Group Holding plc, the comparison of data for 2022 is partially applicable by aiming to do not prejudice the other information quality principles. II. ABOUT US Our beginning dates back to 1997, and over the years we have transformed and restructured in order to address all legal requirements as well as to meet the needs of the market, to ensure sustainable growth and a flexible business model. This is accompanied by the introduction of certified systems for quality management, food control and safety and good manufacturing practices for some of our companies, where detailed information is provided in Appendix IV. The unstable geopolitical situation and economic instability on a global scale, caused by various factors in 2023. have not affected our determination to follow our predetermined path to improvement and expansion through the implementation of carefully considered and validated investment plans. The award we received from the Bulgarian Stock Exchange (BSE) for 2023 - Third Place for Best Liquid Issuer of the PREMIUM Shares segment on the main market of the Bulgarian Stock Exchange proves that we are in the right direction of our development. Other key indicators of our resilient growth this year are as follows: ✓ 23 companies – in early 2023 Almagest AD, subsequently transformed into EOOD, join our Group. ✓ More than 600 employees on permanent contracts ✓ 36 new customers ✓ Over 18 000 ha of cultivated agricultural areas ✓ 5 Logistics centers in Bulgaria ✓ Approximately 380 000 tons of warehouse capacity ✓ 2 production facilities in the country ✓ BGN 78 566 thousand investments made 2 1. ACTIVITIES Agria Group Holding AD through its subsidiaries operates in the following main economic areas: ✓ Agribusiness ✓ Processing and production ✓ Trade/export In the table below we have presented a detailed description of the activities for each company within the scope of this reporting. Table №1 Activities Company Activities Agria Group Holding JSC Involvement in subsidiary management, decision-making, new strategies, investment planning, etc; Renting out its own office spaces and lease of agricultural land for use by subsidiaries. Almagest EOOD Fermentation of cereals, wheat, corn or similar to produce alcohol Kristera AD Wholesale of cereals, seeds, feed; Road freight transport, including transportation of products from cereals producers and provision of transport services to third parties with own transport; Storage of cereals. Korn Trade EOOD Wholesale of cereals, seeds, feed. Kristera - Agro EOOD Soil tillage, sowing, harvesting, production handling and storage Agro EOOD • Soil tillage, sowing, harvesting, production handling and storage AG Property Invest EOOD Activities related to the implementation of investment projects Bora Invest EOOD • Activities related to the implementation of investment projects Bora Energy EOOD Purchase of agricultural land and lease to subsidiaries and other external contractors Aris-Agro EOOD Soil tillage, sowing, harvesting, production handling and storage Toni- М EOOD Soil tillage, sowing, harvesting, production handling and storage Gruvar EOOD Soil tillage, sowing, harvesting, production handling and storage Elit-86 EOOD Soil tillage, sowing, harvesting, production handling and storage Diasvet EOOD Soil tillage, sowing, harvesting, production handling and storage Terra Protect EOOD • Security activities on agricultural bases BD Agri EOOD Soil tillage, sowing, harvesting, production handling and storage BD Farm EOOD Soil tillage, sowing, harvesting, production handling and storage Agrа EAD Soil tillage, sowing, harvesting, production handling and storage Kehlibar EOOD Sunflower oil production; Transport of sunflower and sunflower oil. Silk Gaz BG OOD Wholesale of cereals, seeds, feed; cereals storage; Road freight transport, including transport of production from cereals producers and sales with own transport. Korn Star ОО D • Soil tillage, sowing, harvesting, production handling and storage AgriVia Oil ЕОО D • Wholesale of cereals, seeds, feed 3 2. PRODUCTS Our products are characterized by uncompromised quality that meets the high requirements of our customers and guarantees product safety. Table № 2 Our products Company Products Tonnes of production for 2023. % increase in production compared to 2022 * Almagest EOOD Neutral ethyl alcohol Technical ethanol Bioethanol Feed materials - DDGS and corn oil when working with corn feedstock Ethyl alcohol 24 452 t.; Dehydrated ethanol 20 401 t.; DDSG 23 939 t.; - Kristera - Agro ЕОО D • Cereals 35 601 t. 43.59% Agro EOOD • Cereals 1 913 t. - Aris - Agro EOOD • Cereals 1 407 t. - Тoni- М EOOD • Cereals 3 630 t. - Gruvar EOOD Cereals 3 952 t. - Elit-86 EOOD Cereals 2 292 t. 8.9% Diasvet EOOD Cereals 3 862 t. - BD Agri EOOD Cereals 13 154 t. 31.7% BD Farm EOOD Cereals 2 589 t. - Agra ЕА D Cereals 582 t. - Kehlibar EOOD Unrefined oil Sunflower meal Sunflower husk pellets Unrefined oil- 13 190 t. Sunflower meal - 15 059 t. Sunflower husk pellets – 844 t. Korn Star ОО D Cereals 15 644 t. - * For the fields without values, no increase in production in comparison to 2022 was detected. 3. OUR BUSINESS MODEL The business model we have created aims to maximize the principles of the circular economy, aiming to reduce waste and pollution and ensure sustainable production and consumption of our products within the Group. 4 4. CUSTOMERS Table № 3 Market share based on total revenues from sale of products and services Company Domestic Market Foreign Market Agria Group Holding JSC 100% - Almagest EOOD 65.05% 34.95% Kristera А D 100% - Korn Trade ЕОО D 89.89% 10.11% Kristera - Agro ЕОО D 100% - А gr о ЕОО D 100% - AG Property Invest ЕОО D Not applicable Not applicable Bora Invest ЕОО D Not applicable Not applicable Bora Energy ЕОО D 100% - Aris-Agro ЕОО D 100% - Т oni- М ЕОО D 100% - Gruvar ЕОО D 100% - Elit- 86 ЕОО D 100% - Diasvet ЕОО D 100% - Terra Protect ЕОО D 100% - BD Agri ЕОО D 100% - BD Farm ЕОО D 100% - А gra ЕА D 100% - Kehlibar ЕОО D 91% 9% Silk Gaz BG ЕОО D 100% - Korn Star ОО D 100% - AgriVia Oil ЕОО D 21% 79% 5. SUPPLIERS Table № 4 Geographical distribution of our suppliers based on total supply costs Company Domestic Market Foreign Market Agria Group Holding JSC 100% - Almagest EOOD 34.85% 65.15% Kristera АD 99.89% 0.11% Korn Trade ЕООD 99.95% 0.05% Kristera - Agro ЕООD 100% - Аgrо ЕООD 100% - AG Property Invest ЕООD no significant supply costs no significant supply costs Bora Invest ЕООD 100% - Bora Energy ЕООD 100% - Aris- Agro ЕООD 100% - Тoni - М ЕООD 100% - Gruvar ЕООD 100% - Elit- 86 ЕООD 100% - Diasvet ЕООD 100% - Terra Protect ЕООD 100% - BD Agri ЕООD 100% - BD Farm ЕООD 100% - Аgra ЕАD 100% - Kehlibar ЕООD 100% - Silk Gaz BG ЕООD 97.71% 2.29% Korn Star ООD 100% - AgriVia Oil ЕООD 52% 48% 5 Management III. MATERIAL TOPICS AND RELATED RISKS To determine the material topics to be addressed in the Declaration, we have carefully analysed the activities of all companies in the scope and related requirements of national legislation in the areas of Environment, Occupational health and safety and Governance. We subsequently carried out a review of best practice for disclosure of non-financial information from our clients and other companies in relevant sectors. The obtained information on various material topics was compared to the sectoral standards of internationally recognized Frameworks for non-financial reporting such as the Global Reporting Initiative (GRI) and Sustainability Accounting Standards Board (SASB). The selection of material information to be disclosed was led in addition by the Guidelines of the Task Force on Climate-related Financial Disclosures (TCFD) and the Task Force on Nature-related Financial Disclosures (TNFD). We have carefully analyzed the sustainability-related dependencies and risks relevant to our operations, some of the most significant ones being in the areas of climate, energy, protection of natural capital, waste reduction, and safe working conditions. Also, given the fact that Agria Holding JSC is a BSE listed company and as such shares commonly accepted values of responsible business, we strive to ensure full compliance with national environmental and human resources legislation and to comply with the International Bill of Human Rights, the UN Guiding Principles on Business and Human Rights, the OECD Guidelines for Multinational Enterprises, the European Convention on Human Rights, the OECD Principles of Corporate Governance and other International Standards. Therefore, the process of identifying material topics and information was consistent with all of the above as well. The information gathered based on our review and analysis process was discussed with representatives of all companies and systematized into material topics and information. The outcomes were subsequently discussed and validated by the Managing Directors of the companies in the scope and the Board of Directors of Agria Group Holding JSC. Based on the above mentioned, the Declaration covers the following material topics: Environment • Greenhouse gas emissions • Energy • Pollutants • Water • Waste and circular economy • Biodiversity Social Responsibility • Safe working conditions • Employee rights • Diversity • Product safety • Local communities • Anti-corruption - transparency and reputation • Competitive behavior • Political influence • Responsible business conduct • Suppliers Management 6 Table № 5 Distribution of essential topics on a company level * The dynamic of the sustainability regulatory environment requires analysis of our activities and risks on an annual basis. Therefore, the material topics listed in Table № 1 are subject to ongoing monitoring and analysis, based on which the reporting areas and details of disclosed information may be reviewed, supplemented and amended at each subsequent stage of the Annual sustainability reporting cycle. In this regard, we would like to inform all stakeholders that, with a view to preparing the first Sustainability Report pursuant to Directive 2022/2464 of the European Parliament and of the Council of 14 December 2022 (CSRD) and Commission Delegated Regulation (EU) 2023/2772 of 31 July 2023, all companies in the scope of current reporting have undertaken a thorough review of their activities, a reassessment of risks, an inventory of available data and an analysis of the need to gather additional information. GHG Emissions Energy Pollutants Biodiversity Waste and circular economy Water withdrawal Water discharge Product safety Local communities Safety working conditions Employee rights Diversity Political influence Anti- corruption Competitive behaviour Responsible business conduct Suppliers Management Agria Group Holding JSC х х х х х х х х Almagest EOOD х х х х х х х х х х х х х х х х Kristera АD х х х х х х х х х х Korn Trade ЕООD х х х х х х х х х Kristera - Agro ЕООD х х х х х х х х х х х х х Аgrо ЕООD х х х х х х х х х х AG Property Invest ЕООD х х х х х Bora Invest ЕООD х х х х х х Bora Energy ЕООD х х х х х х Aris-Agro ЕООD х х х х х х х х х х Тoni-М ЕООD х х х х х х х х х х Gruvar ЕООD х х х х х х х х х х х Elit-86 ЕООD х х х х х х х х х х Diasvet ЕООD х х х х х х х х х х Terra Protect ЕООD х х х х х х х BD Agri ЕООD х х х х х х х х х х х х х х х BD Farm ЕООD х х х х х х х х х х Аgra ЕАD х х х х х х х х х х Kehlibar ЕООD х х х х х х х х х х х х х х х х Silk Gaz BG ЕООD х х х х х х х х х х Korn Star ООD х х х х х х х х х х х х х х х AgriVia Oil ЕООD х х х х х х х х х Име на дружеството Environment Social Responsibility Governance 7 IV. ENVIRONMENT 1. GREENHOUSE GAS EMISSIONS AND ENERGY The activities in the agricultural sector are highly dependent on climate change. The potential occurrence of physical climate-related risks such as heavy rainfall, storms, floods and drought could have a significant adverse impact on the yield and quality of our agricultural products or other companies’ assets, while also adversely affect the companies' financial results and overall performance. The transition to a low-carbon and climate-resilient economy may also pose certain legal, market, reputational or technological risks for us. These are subject to detailed analysis and assessment. We are currently considering the development of a specific Transition Plan, that will allow us to identify adequate risks and opportunities to address them, and to set measurable and achievable decarbonization targets. According to the 2019 Intergovernmental Panel on Climate Change (IPCC) Special Report on Climate Change and Land, agriculture is responsible for a large portion of greenhouse gas (GHG) emissions. From 2007 to 2016, the sector was responsible for approximately 13% of carbon dioxide (CO2), 44% of methane (CH4), and 82% of nitrous oxide (N2O) emissions from human activities globally, accounting for 23% of total net anthropogenic GHG emissions during this period. As of the date of this Declaration, we were unable to disclose data for Scope 1 and Scope 2 emissions that would ensure completeness, accuracy and correctness. In this regard, we have envisaged establishing a common approach to collecting, analysing, monitoring and managing GHG emissions data that will enable us to disclose the information for the Year 2024. To minimize the potential negative effect of these risks, insurances are established for all areas on the work in progress of agrotechnical activities covering all risks including storm, fire, hail and crop frost on all crops grown. In addition, insurance against all generally accepted risks, including earthquake risk, is established for all real estate and production facilities owned by the companies in the Group. It is therefore critical for us to establish a management and monitoring process for greenhouse gas emissions from our operations and to reduce them by introducing good agricultural practices in: 1) soil cultivation aiming to preserve soil quality to absorb greenhouse gas emissions; 2) the use of fertilizers and pesticides by investing in new technologies to help reduce the carbon footprint of our operations; as well as by implementing of carbon capture mechanisms. 8 Table № 6 Information on type and quantity of fuels used Company Quantity purchased (liters) Quantity Consumed (liters) Diesel Gas Oil for off-road machineries and tractors Gasoline Diesel Gas Oil for off-road machineries and tractors Gasoline Almagest EOOD 29 567.66 - 595.48 29 567.66 - 595.48 Kristera АD 1 899 058 - - 1 899 058 - Korn Trade ЕООD - - 2 088 - - 2 088 Kristera - Agro ЕООD 94 107.27 933 243.29 10 807.18 94 107.27 933 243.29 10 807.18 Аgrо ЕООD 36 889.46 - - 36 889.46 - - Aris-Agro ЕОО D 22 108.11 - - 22 108.11 - - Т oni- М ЕОО D - 61 723.97 - - 61 723.97 - Gruvar ЕОО D - 113 847.80 - - 113 847.80 - Elit- 86 ЕОО D - 23 528.76 - - 23 528.76 - Diasvet ЕОО D - 39 495.48 - - 39 495.48 - BD Agri ЕОО D 19 228.89 253 383 - 19 228.89 253 383 - BD Farm ЕОО D - 32 671.68 - - 32 671.68 - Agra ЕАD 43 914.66 - - 43 914.66 - - Kehlibar ЕОО D 156 000 - - 156 000 Silk Gaz BG ЕОО D 516 000 - - 487 000 - - Korn Star ООD 25 472.16 266 642.72 148.12 25 472.16 266 642.72 148.12 In the case of ordered and unused fuel, the same is stored in licensed modular gas stations located at dedicated sites, thus taking all preventive measures to protect the environment and ensure safe working conditions in case of a leakage. Regarding energy used, we considered the subject to be essential for the companies whose operations are related to the production and/or storage of products. Table № 7 Information on type and quantity of energy used Company Energy consumption (MWh) Natural Gas Purchased electricity from supplier* Renewable sources (purchased) Renewable sources (own) Nuclear sources Almagest EOOD 22 315 17 820 105 855 - - Kristera АD 140.85 889.06 - - - Kristera - Agro ЕООD - 128.07 - - - BD Agri ЕООD - 39.62 - - - Kehlibar ЕООD - 20 054 2 329 17 725 - Silk Gaz BG ЕООD - 100.28 - - - Korn Star ООD - 69.03 - - - * The invoices from the electricity suppliers do not provide information on the energy mix 9 ✓ Photovoltaic power plant for the needs of Kehlibar EOOD with an installed capacity of 140 kWp has been commissioned; ✓ A new natural gas cauldron has been installed (Almagest EOOD); ✓ Replacement of luminescent lamps with LED ones has been carried out (Almagest EOOD); ✓ Purchased 18 freight wagons for rail transport (AgriVia Oil EOOD); ✓ Preservation of soil quality as a natural carbon absorber by: ▪ using alternatives to pesticides; ▪ use of selective pesticides, preserving biodiversity and controlling well-defined pests and at well- defined time scales, taking into account the biology and development of species; ▪ investing in innovative agricultural soil treatment equipment with "smart farming" software to reduce the use of pesticides and fertilizers ▪ harvesting pest-resistant crops, also resistant to unfavorable weather conditions; ▪ mechanical weed control; ▪ periodic assessments of the need for crop enrichment by adding the necessary types and quantities of nutrients during the different stages of plant growth; ▪ a balanced use of nutrients against needs, determined based on measurement and laboratory analyses; ▪ rotational sowing of crops by introducing well-founded rotation to avoid the negative impacts and apply good sanitary practices; ▪ plowing of organic residues in the soil, including plant residues from previous crops in order to restore part of the nutrients in the soil horizon; ▪ use of agricultural machinery for harvesting of cereals, equipped with devices for uniform dispersal of crop residues; ▪ providing buffer zones around water sources to protect biodiversity and reduce nutrient loss. 2. POLLUTANTS AND OTHER EMISSIONS In soil treatment we use selective, second and non-professional category pesticides as well as mineral and organic fertilizers. Table № 8 Information on pesticides and fertilisers used for soil treatment Company Amount of organic substances used (kg) Intensity of organic substances used Quantity of pesticides used (kg) Intensity of pesticides used Kristera АD 48 120 10kg/ha 4 333 Integrated approach Kristera - Agro ЕООD 7 430 10kg/ha 526 Integrated approach Aris-Agro ЕОО D 3 047 10kg/ha 421 Integrated approach Т oni- М ЕОО D 6 636 10kg/ha 14 Integrated approach Gruvar ЕОО D 6 227 10kg/ha 152 Integrated approach Е lit- 86 ЕОО D 3 326 10kg/ha 494 Integrated approach Diasvet ЕОО D 6 133 10kg/ha 82 Integrated approach BD Agri ЕОО D 21 474 10kg/ha 2 263 Integrated approach BD Farm ЕОО D 4 488 10kg/ha 1 090 Integrated approach А gra ЕА D 7 403 10kg/ha 1 284 Integrated approach Korn Star ОО D 52 942 10kg/ha 1 205 Integrated approach Good practices 10 To manage the potential risks of soil acidification and erosion, in addition to the good practices already mentioned above, we have put in place the following measures: ✓ Preparation and periodic updating of soil management and conservation plans; ✓ Preparation and periodic updating of pesticide management plans; ✓ Implementing an integrated approach to pesticide use; ✓ Soil cultivation tailored to its topography; ✓ Use of selective products; ✓ Periodic soil analyses; ✓ Sowing intercrops tailored to the variety and type of main crop; ✓ Use of biologically active substances. The activities of Almagest EOOD and Kehlibar EOOD are associated with the release of other emissions to air and water. The installations owned by these two companies are subject to monitoring and reporting, and according to national legislation for Almagest EOOD this is done on an annual basis, whereas for Kehlibar EOOD measurements are carried out every two years. Due to the fact that the last measurement of other air emissions for the relevant installation of Kehlibar EOOD was carried out in 2022, the company is unable to provide data for the current non-financial reporting. Table № 9 Information on other emissions and pollutants from the activities of Almagest EOOD Category Type Quantity (kg) Norm under the applicable law Other emissions Dust 3 290.0225 50 000 Carbon monoxide 0 500 000 Total organic carbon 200.7865 500 000 Nitrogen oxides 15 352.5394 100 000 Sulphur oxides 0 150 000 Other pollutants Total Nitrogen 809.8279 50 000 Total phosphorus 44.6802 5 000 * The emission measurement methodology is in accordance with Regulation 166/2006 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 18 January 2006 concerning the establishment of a European Pollutant Release and Transfer Register and amending Council Directives 91/689/EEC and 96/61/EC (EPTR). To reduce these emissions and pollutants, Almagest EOOD has implemented Best Available Techniques (BAT). In 2023 inspections were carried out by competent authorities, where no violations were found. 3. WATER Water is a critical resource for the operations of some of our companies. By analysing their operations, it was identified that the most intensive water withdrawals for 2023 are based on the activities of our production facilities, as well as in maize cultivation. During our reporting period, we were not aware of any water sources used that were in a water stress area, as a result of which no Good practices 11 additional measures were imposed on us by the competent authorities and/or consideration of significant risks in this area was not required. Table №10 Water consumption information Company Method of use Water source Quantity(cubic m) Almagest EOOD In technological processes; Cauldron water; Cooling; Backer Dere dam 395 821 Kristera - Agro ЕОО D Irrigation Surface water body Kamchia River 701 827 Gruvar ЕООD Irrigation Irrigation canal fed by the Ticha dam 401 660 Kehlibar ЕООD For the production of steam; Cooling; In technological processes; Maintaining hygiene for employees and production premises. Central water supply and high groundwater capture system. 50 128* *The quantity indicated is only for water consumed from the central water supply. At this stage, Kehlibar EOOD does not perform quantity measurements on water consumed from the high groundwater capture system. Managing the quality of wastewater from our production facilities is another important priority for us, both in terms of meeting the requirements of our national legislation and our commitment to protect the environment and people's health as a responsible business partner. In this regard, we have put in place best practices to ensure that no hazardous substances enter our wastewater. In addition, Almagest EOOD has its own Wastewater Treatment Plant (WWTP). Таблица №11 Wastewater information Company Discharge Quantity (cubic m) Almagest EOOD Surface water – M ати vir River 279 251 Kehlibar ЕОО D* Urban sewerage - * The company has no practice in place to measure the quantity of wastewater 4. WASTE Reducing waste is part of the circular economy principles we aim to apply. Therefore, various waste management practices have been introduced, including the implementation of BAT (Almagest EOOD) and the use of recyclable plastic for packaging (Kehlibar EOOD), which are tailored to its type and degree of hazard. In cases where hazardous waste is present, it is stored and handed over in accordance with the statutory procedures, with particular attention also being paid to adequate training and awareness of our employees involved in this process. In addition, it should be noted that no infringements in this area have been detected during the inspections carried out by the competent authorities in 2023. 12 Table №12 Information regarding waste by type and quantity Company Waste code Quantity(tonne) Almagest EOOD Household waste Not applicable 17 04 05 iron and steel 0 15 01 10* packaging containing residues of or contaminated by hazardous substances 0 15 02 02* absorbents, filter materials (including oil filters not otherwise specified), wiping cloths, protective clothing contaminated by hazardous substances 0 20 01 21* fluorescent tubes and other mercury-containing waste 0 Kehlibar ЕООD 02 03 01 sludges from washing, cleaning, peeling, centrifuging and separation 33 15 01 01 paper and cardboard packaging 0.32 15 01 02 plastic packaging 1.09 10 01 01 slag, dross, boiler ash 16 Kristera - Agro ЕОО D 16 01 07 oil filters 0.3 16 06 01* lead batteries 0.7 15 01 10* packaging containing residues of or contaminated by hazardous substances 9.23 16 01 03 end-of-life tires 0 BD Agri ЕООD 16 01 07 oil filters 0.06 16 06 01* lead batteries 0.60 15 01 10* packaging containing residues of or contaminated by hazardous substances 2.08 16 01 03 end-of-life tires 0 Korn Star ООD 15 01 10* packaging containing residues of or contaminated by hazardous substances 2.68 ✓ Almagest EOOD - 100 % reduction of waste with codes 17 04 05, 15 01 10*, 15 02 02*, 20 01 21*; ✓ Kehlibar EOOD - 5% reduction of waste with code 02 03 01, 19% reduction of waste with code 15 01 01, 84% reduction of waste with code 15 01 02, 14% reduction of waste with code 10 01 01; ✓ Kristera - Agro EOOD - 33% reduction in the total quantity of waste; ✓ BD Agri EOOD - 45% reduction in total quantity of waste. 5. BIODIVERSITY The current topic is closely related to climate, pollution and water. Therefore, in addition to the activities mentioned above, which are directly related to biodiversity conservation also, we would like to inform our stakeholders about the cultivation of Natura 2000 land and to point out specific measures implement in this regard. Achievements 2023/2022. 13 Table № 13 Information on Natura 2000 sites Company Object Type occupied area (ha) Natura 2000 Kristera - Agro ЕОО D Agricultural land 696.16 Yes Тoni М ЕООD Agricultural land 123.56 Yes BD Agri ЕОО D Agricultural land 1 979.35 Yes BD Farm ЕОО D Agricultural land 406.35 Yes Аgrа ЕАD Agricultural land 380.48 Yes When cultivating land in Natura 2000, we strictly comply with the requirements of the National Environment Act and the National Biodiversity Act. We do not carry out agricultural activities on lands that can be classified as pastures, meadows and grassland. In addition, we: ✓ Do not remove landscape features (boundary strips, single and group trees) when using agricultural land as such; ✓ Do not use non-selective pest control agents in agriculture. V. SOCIAL RESPONSIBILITY 1. SAFE WORKING CONDITIONS In terms of our social responsibility, we strive to be consistent both in complying with all legal requirements and our policies and principles. Part of this responsibility is to provide a safe working environment for our employees and external workers. For us, achieving healthy and safe working conditions is a prerequisite for the effectiveness of our operations and for achieving the Group's strategic objectives. To achieve this, we have policies and standards in place, as well as processes to identify, assess, monitor and analyse risks. The main risks identified in this area relate to physical safety when working with machinery and equipment, handling chemicals, including pesticides, fires and explosions, and the spread of viruses and infections. Adequate preventive measures have been taken in this regard, which include, for example, training of employees, restricted access to machinery only by certain employees with the necessary experience and qualifications, hygiene practices in place, use of modern machinery and equipment, etc. Other good practices implemented by us are periodic instructions of employees, which depending on the nature of the work may be on a monthly, six monthly or annual basis, and for all newly recruited employees and outsourced workers, an introduction instruction is mandatory within the first days of employment. With regard to Terra Protect EOOD, the company is licensed to carry out security activities and these are implemented without the use of guns. In particular, all security guards have the necessary qualifications and experience to carry out their specific duties and follow clear rules and procedures ensuring that human rights are not violated. STRICTLY OBSERVED AND ENFORCED RESTRICTIONS 14 In 2023, there were no work-related accidents recorded for our Group companies, except for Silk Gaz BG EOOD, where there was 1 accident of a minor nature recorded, resulting in temporary absence from work of the employee concerned. Table №14 Information on safe working conditions training * Company Subject Number of employees trained Agria Group JSC 10.02.2023 - Training in accordance with Article 24 of the Occupational Health and Safety (OHS) Act and Article 6, paragraph 1, item 1, item 2, item 3 and item 4 of Decree RD-07-02/16.12.2009 on the conditions and procedure for periodic training and instruction of employees on the rules for ensuring healthy and safe working conditions. 1 Almagest EOOD OSH training in accordance with Article 26, paragraph 2, Article 25a, paragraph 1, item 5 of the OHS Act in conjunction with Article 2, paragraph 1 and Article 6, paragraph 1, items 2,3,4 of Decree № RD-07-2 on the conditions and procedure for conducting periodic training and instruction of employees on the rules for ensuring OHS 2 Periodic instruction on OHS, in accordance with Decree № RD-07-2 on the conditions and procedure for conducting periodic training and instruction of employees on the rules for ensuring OHS 140 Annual emergency plans exercises 140 Training of personnel in the safe handling of pressure equipment and natural gas fired installations 11 Kristera AD Healthy and safe working conditions 3 Occupational Safety Qualification Group Course - Electrical Facility Work 4 Korn Trade ЕОО D Training in accordance with Article 24 of the Occupational Health and Safety Act and Article 6, paragraph 1, item 1, item 2, item 3 and item 4 of Decree № RD -07-2/16.12.2009 on the conditions and procedure for periodic training and instruction of employees on the rules for ensuring healthy and safe working conditions. 1 Kristera - Agro ЕОО D Training in accordance with Article 24 of the Occupational Health and Safety Act and Article 6, paragraph 1, item 1, item 2, item 3 and item 4 of Decree № RD -07-2/16.12.2009 on the conditions and procedure for periodic training and instruction of employees on the rules for ensuring healthy and safe working conditions. 7 Bora Energy ЕОО D Not applicable - Terra Protect ЕОО D Training in accordance with Article 24 of the Occupational Health and Safety Act and Article 6, paragraph 1, item 1, item 2, item 3 and item 4 of Decree № RD -07-2/16.12.2009 on the conditions and procedure for periodic training and instruction of employees on the rules for ensuring healthy and safe working conditions. 1 BD Agri ЕОО D Training in accordance with Article 24 of the Occupational Health and Safety Act and Article 6, 3 15 paragraph 1, item 1, item 2, item 3 and item 4 of Decree № RD -07-2/16.12.2009 on the conditions and procedure for periodic training and instruction of employees on the rules for ensuring healthy and safe working conditions. Kehlibar ЕОО D Personal hygiene and staff behavior. 4 Silk Gaz BG ЕОО D Training in accordance with Article 24 of the Occupational Health and Safety Act and Article 6, paragraph 1, item 1, item 2, item 3 and item 4 of Decree № RD -07-2/16.12.2009 on the conditions and procedure for periodic training and instruction of employees on the rules for ensuring healthy and safe working conditions. 1 Korn Star ОО D - - AgriVia Oil ЕОО D Training in accordance with Article 24 of the Occupational Health and Safety Act and Article 6, paragraph 1, item 1, item 2, item 3 and item 4 of Decree № RD -07-2/16.12.2009 on the conditions and procedure for periodic training and instruction of employees on the rules for ensuring healthy and safe working conditions. 4 * The companies Agro EOOD, AG Property Invest EOOD, Bora Invest EOOD, Aris Agro EOOD, Toni-M EOOD, Gruvar EOOD, Elit-86 EOOD, Diasvet EOOD, BD Farm EOOD, Agra EAD do not have any permanent employees for 2023. 2. EMPLOYEE RIGHTS Ensuring equal rights for all employees regardless of gender, race, ethnicity, beliefs and age is our primary responsibility and priority. In this regard, we are guided strictly by the requirements of national legislation and generally accepted international principles and best practices. Our employees can be any person who meets the requirements for the respective position. We do not have a practice of employing children or minors, and we monitor compliance with this principle for all external workers carrying out activities within our organizations. Remuneration is according to objective indicators such as complexity of work, responsibilities, workload, years of experience and the parameters of the work environment. In addition, a Remuneration policy for the members of the Board of Directors of Agria Group Holding JSC has been developed and published on the Company's website: https://www.agriabg.com. The employment relationships with all our employees are clearly justified in contracts. The duties of our employees are described in job descriptions that are part of the employment contracts. Upon commencement of employment, each new employee must familiarize himself/herself with the Internal Labor Manual and other rules and policies of the respective company, depending on the responsibilities of the position occupied. The working week for each employee is also within the statutory limits. We have no practice of delaying payment to our employees, and in the case of overtime, work on weekends and/or shift work, we mandatory follow the specific requirements of the Labor Code (LC) and the Ordinance for Working Hours, Breaks and Leave (OWHBL), while providing additional payment and complying with the periodicity of breaks for the respective employees in accordance with the LC and the Ordinance on the Structure and Organization of Wages. Lunch breaks as well as physiological breaks are in accordance with national legislation and are included in the working time. 16 Employees shall be entitled to all types of leave under the terms and conditions laid down in the Labor Code and the OWHBL. Annual paid leave shall be authorized in a written order after consultation with the line manager, ensuring that continuity of company processes and excessive workload of employees is not disturbed. Childbirth and maternity leaves are available from the day specified in the application by the mother/father and the employee's job is guaranteed for that period. Our employees are insured in accordance with the Social Security Code and its implementing acts. Employees may be additionally insured in accordance with the terms and conditions established in the regulations. We encourage getting feedback on the work process from our employees, each of whom has direct access to their line manager and to a Human Resources representative. As a responsible employer, we value good performance and recognize the importance of engaging our employees in teamwork and sharing our business values. In this regard, we implement various mechanisms such as additional financial and social incentives, team building, rewards, etc. We support our employees on their path to continuous knowledge and skills development by combining the acquisition of professional experience through practice with additional specialized training. Table №15 Information about other specialized trainings Company Subject Number of employees trained Agria Group Holding JSC Annual accounting and tax closure for 2023; Expected legislative changes in 2024. 1 2023 Annual Jubilee Meeting of Association of Bulgarian Investor Relations Directors 1 Introduction and discussion of the new Whistleblowing law. Obliged entities and internal organization. 1 Almagest EOOD Annual training in relation to ISM, in accordance with the requirements of BDS EN ISO 9001, HACCP, GMP, ISCC-EU 140 Training for the confirmation of a qualification group of personnel servicing electrical installations and equipment 3 Training on simulated crisis in the event of a product recall 9 Annual training in connection with the Complex Permit 9 Training in compliance with Article 26c of the Feed Law 140 Kristera AD "Grain Academy" 2 Amendments to the Labor Code 1 Annual closure, Corporate Income Tax Act, Personal Income Taxes Act, Value Added Tax Act 4 Korn Trade ЕОО D Annual accounting and tax closing for 2023. Expected changes in legislation in 2024. 1 "Grain Academy" 2 Kristera - Agro ЕОО D Annual accounting and tax closing for 2023. Expected changes in legislation in 2024. 2 Preparation of users agreements with CadIS 1 17 Tax aspects of related party transactions 2 Bora Energy ЕОО D - - Terra Protect ЕОО D - - BD Agri ЕОО D Record keeping and working with the National Waste Information System (NWIS) 1 Annual accounting and tax closure for 2023. Expected legislative changes in 2024. 1 Kehlibar ЕОО D Training of operators for monitoring of Critical control points 40 Silk Gaz BG ЕОО D - - Korn Star ОО D - - AgriVia Oil ЕОО D - - 3. DIVERSITY We strongly condemn any act of discrimination. We share the principles of equal treatment between men and women regardless of racial or ethnic origin, religion or belief, physical disability, sexual orientation and age. Given the specific nature of our operations, as well as the labor market characteristics in the regions in which we operate, a major challenge we still face is achieving equality related to the number of employees by gender. Table №16 Information on the total number of permanent staff Company Total number of employees Men Women Agria Group Holding JSC 17 6 11 Almagest EOOD 142 106 36 Kristera AD 130 110 20 Korn Trade EOOD 8 2 6 Kristera - Agro EOOD 102 69 33 Agro EOOD 0 - - AG Property Invest EOOD 0 - - Bora Invest EOOD 0 - - Bora Energy EOOD 1 1 0 Aris-Agro EOOD 0 - - Toni- М EOOD 0 - - Gruvar EOOD 0 - - Elit-86 EOOD 0 - - Diasvet EOOD 0 - - Terra Protect EOOD 54 52 2 BD Agri EOOD 25 15 10 BD Farm EOOD 0 - - Agrа EAD 0 - - Kehlibar EOOD 78 70 8 Silk Gaz BG OOD 44 34 10 Korn Star ООD 34 30 4 AgriVia Oil ЕООD 15 10 5 TOTAL 650 505 145 18 Table №17 Information on the total number of employees on temporary or seasonal contracts * Company Total number of temporary/seasonal staff Men Women Kristera AD 26 21 5 Kristera - Agro ЕОО D 47 43 4 TOTAL 73 64 9 * Applicable for the above-mentioned companies only Table №18 Information on the total number of employees on management positions* Company Total number of managerial staff Men Women Agria Group Holding JSC 6 3 3 Almagest EOOD 20 15 5 Kristera AD 14 12 2 Korn Trade EOOD 1 - 1 Kristera - Agro EOOD 13 11 2 Bora Energy ЕОО D 1 1 - Terra Protect ЕОО D 1 1 - BD Agri ЕОО D 2 2 - Kehlibar EOOD 5 5 - Silk Gaz BG OOD 3 2 1 Korn Star ООD 3 3 - AgriVia Oil ЕООD 1 1 - ОБЩО 69 55 14 *The definition of a management position includes an executive director, financial director, managing director, member of the Board of Directors, member of the General Assembly, directors and department/production heads 19 Table №19 Information on the total number of resigned employees and employees returning to work after maternity leave in 2023.* Company Total number of resigned employees on permanent contract Number of men Position held Number of women Position held Number of permanent employees returning to work after maternity leave Agria Group Holding JSC 2 - - 2 Accountant Investor Control Manager Almagest EOOD 19 11 Technologist Head of Department Economist Silo worker Electrician Technical process operator Dispatch organiser 8 Technologist Project Manager Hygienist Laboratory Technician Dispatch organiser Kristera AD 3 - - 3 Technical Director Reporting Officer Laboratory Technician 1 Kristera - Agro ЕОО D 18 13 Driver, AM Mechanic, agricultural machinery Unskilled worker 5 Specialist, land management and lease relations Accountant Technical Assistant Hygienist 1 Terra Protect ЕОО D 8 6 Security Guard 2 Security Guard BD Agri ЕОО D 1 - - 1 Accountant Kehlibar EOOD 15 14 Stoker Fader Production Manager Unskilled worker Electrician Driver Industrial production service worker 1 Technical Secretary Silk Gaz BG OOD 6 5 Driver 1 Technical Secretary Korn Star ООD 2 2 Driver, AM Guard, porter - - AgriVia Oil ЕООD 3 1 Unskilled worker 2 Technical Assistant Logistics Manager TOTAL 77 52 25 2 * Applicable only to the companies mentioned 20 4. LOCAL COMMUNITIES According to the information presented in Table № 4, a significant part of our suppliers are from Bulgaria. In addition, between 75% and 100% of the permanent employees of our companies within the Group are residents of the geographical areas in which we operate. With all this, we believe that we contribute to the development of the country's economy, to local businesses and to the well- being of local communities. In addition, we continue to support the cultural development of local communities and making donations to other noble causes to support our society. Table № 20 Information about donations Company Donation date Recipient Purpose of the donation Amount in BGN* Agria Group Holding JSC 02.05.2023 PROCESS-SPACE FOUNDATION Organization of art events in Balchik 10 000 03.10.2023 Beloslav Municipality Organizing events in honor of the celebration of the town of Beloslav 3 000 19.12.2023 BULGARINA NATIONAL TELEVISION THE BULGARIAN CHRISTMAS - helping children with medical needs and disabilities 10 000 Almagest EOOD 06.04.2023 Ihtiman Municipality Constructing a bas-relief of the great person from the Bulgarian Revival period from the town of Ihtiman - Genady of Ihtiman 10 000 03.08.2023 Ihtiman Municipality Conducting events related to the cultural and mass activities of Ihtiman Municipality 10 000 Kristera AD 27.10.2023 Beloslav Municipality Organizing events in honor of the celebration of the town of Beloslav 3 000 Kristera - Agro EOOD 27.03.2023 THE CHURCH OF ST. DIMITER village of Yankovo Helping to meet the needs of the organization 600 07.04.2023 COMMUNITY CENTRE SAGLASIE 1891 village of Osenets Helping to meet the needs of the organization 258.74 02.05.2023 Petrov dol Village Hall Ceremonial opening of the harvest season 800 05.06.2023 COMMUNITY CENTRE SAGLASIE 1891 Village of Osenets Helping to meet the needs of the organization 332.20 28.06.2023 COMMUNITY CENTRE SAGLASIE 1891 Village of Osenets Helping to meet the needs of the organization 200 01.08.2023 COMMUNITY CENTRE PROBUDA Helping to meet the needs of the organization 900 21 1928 village of Lomtsi 29.08.2023 COMMUNITY CENTRE SAGLASIE 1891 village of Osenets Helping to meet the needs of the organization 145.10 08.12.2023 COMMUNITY CENTRE SAGLASIE 1891 village of Osenets Helping to meet the needs of the organization 90.59 21.12.2023 Lomtsi Village Hall Organizing a Christmas celebration 200 BD Agri EOOD 24.04.2023 COMMUNITY CENTRE NADEZHDA-1901 village of Gradinarovo Helping to meet the needs of the organization 1 660 19.07.2023 COMMUNITY CENTRE SVETLINA - 1911- village of Ravna Helping to meet the needs of the organization 900 Korn Star OOD 04.10.2023 COMMUNITY CENTRE YORDAN YOVKOV 1941 village of Zmeevo Helping to meet the needs of the organization 200 TOTAL * All amounts from donations can be tracked in the Consolidated Financial Statement under note Other Expenses - Donations. 5. PRODUCT SAFETY Ensuring the safety of our products is part of our mission to provide access to quality food and products for the people. The measures we have taken and the best practices we have implemented support this mission. ✓ All of our suppliers of critical raw materials/products are required to have certificates of origin and quality including ISO 9001, ISO 22000/HACCAP and etc.; ✓ Raw materials/products received from our suppliers are analyzed/tested in licensed laboratories for various indicators depending on the raw material/product, such as: Benzopyrenes, Phosphorus, Mineral oils, Allergens, Acidity, GMOs, % Analytical Purity, % Germination, % Moisture, Fat content, Impurities, Phosphohydrogen, Live Contaminants and Noxious Impurities, Aflatoxins - SOP PG 13-03 "Grain Input Control", Heavy Metals, Salmonella and Pesticides etc. ✓ The quality of the products manufactured by us is also tested in our licensed laboratories before certification is issued by us. In addition, we have put in place a mechanism for the results of our analyses to be tested and confirmed by external independent laboratories. The indicators we monitor by product type may be as follows: Cereals - % analytical purity, % germination, % moisture; Ethanol for food industry- alcohol content, esters, aldehydes, higher alcohols, methanol, absorption from 220nm to 270nm, total acidity; Feed grade DDGS - moisture, crude protein, crude fat, crude ash, crude fiber, calcium and phosphorus; Crude corn germ oil - Good practices 22 moisture and volatile matter, free fatty acids and acidity, acid value, insoluble impurities and sludge; oil - indicators according to a monitoring program certified by the Bulgarian Food Safety Agency. ✓ In addition, prior to acceptance of our products by our customers, they also carry out product tests and analyses in their designated licensed laboratories. VI. GOVERNANCE The success of our business is built on compliance with the laws, rules and ordinances of our country. All our actions are based on responsible and honest treatment of our business partners, customers, suppliers, competitors, employees and the society. In this regard, we strive to comply with the Principles for Responsible Business Conduct in accordance with the OECD Guidelines for Multinational Enterprises. We have zero tolerance for corruption and strongly dissociate ourselves from any actions that may constitute a direct or indirect form of bribery and/or lobbying and other illegality. Keeping full, true and accurate financial records is an important control mechanism to ensure this. We strictly observe and prohibit the giving and accepting of incentives in any form that may impair our integrity and objectivity in decision making. We respect the right of everyone to exercise their civil rights and to participate in the political life of the country, but at the same time, we insist that representatives of a management position in our organization do not hold key political positions. Each of our employees and person holding a leadership position in our organization should not allow the interests of the company to be compromised at the favor of his or her personal interests. The professional performance of everyone's duties requires objectivity, responsibility and integrity in order to avoid conflicts of interest. Applying the principles of fair competition is key to our resilient development and positioning ourselves on the market as a responsible business partner. We accept the existence of competition in the sectors we operate as an incentive to improve and build on our strengths. We do not engage in actions directly or indirectly that may violate competition laws and consequently may damage our reputation. We expect our suppliers to comply with the minimum principles of responsible business conduct set out here, while building on them in our reported areas of environmental and social responsibility. VII. DISCLOSURES ON ENVIRONMENTALLY SUSTAINABLE ECONOMIC ACTIVITIES 1. BACKGROUND Current reporting is based on the requirements of: ✓ REGULATION (EU) 2020/852 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 18 June 2020 on the establishment of a framework to facilitate sustainable investment, and amending Regulation (EU) 2019/2088 (Regulation 2020/852); 23 ✓ COMMISSION DELEGATED REGULATION (EU) 2021/2139 of 4 June 2021 supplementing Regulation (EU) 2020/852 of the European Parliament and of the Council by establishing the technical screening criteria for determining the conditions under which an economic activity qualifies as contributing substantially to climate change mitigation or climate change adaptation and for determining whether that economic activity causes no significant harm to any of the other environmental objectives (Regulation 2021/2139); ✓ COMMISSION DELEGATED REGULATION (EU) 2021/2178 of 6 July 2021 supplementing Regulation (EU) 2020/852 of the European Parliament and of the Council by specifying the content and presentation of information to be disclosed by undertakings subject to Articles 19a or 29a of Directive 2013/34/EU concerning environmentally sustainable economic activities, and specifying the methodology to comply with that disclosure obligation (Regulation 2021/2178) . ✓ COMMISSION DELEGATED REGULATION (EU) 2022/1214 of 9 March 2022 amending Delegated Regulation (EU) 2021/2139 as regards economic activities in certain energy sectors and Delegated Regulation (EU) 2021/2178 as regards specific public disclosures for those economic activities (Regulation 2022/1214). ✓ COMMISSION DELEGATED REGULATION (EU) 2023/2485 of 27 June 2023 amending Delegated Regulation (EU) 2021/2139 establishing additional technical screening criteria for determining the conditions under which certain economic activities qualify as contributing substantially to climate change mitigation or climate change adaptation and for determining whether those activities cause no significant harm to any of the other environmental objectives (Regulation 2023/2485). ✓ COMMISSION DELEGATED REGULATION (EU) 2023/2486 of 27 June 2023 supplementing Regulation (EU) 2020/852 of the European Parliament and of the Council by establishing the technical screening criteria for determining the conditions under which an economic activity qualifies as contributing substantially to the sustainable use and protection of water and marine resources, to the transition to a circular economy, to pollution prevention and control, or to the protection and restoration of biodiversity and ecosystems and for determining whether that economic activity causes no significant harm to any of the other environmental objectives and amending Commission Delegated Regulation (EU) 2021/2178 as regards specific public disclosures for those economic activities (Regulation 2023/2486) . In preparing these disclosures we also consider the European Commission's Notices of Interpretation of certain legal provisions of the Delegated Acts on disclosure under Article 8 of Regulation 2020/852, published in the Official Journal of the European Union, and known to us at the date of preparation of the Non-Financial Statement for 2023. We would like to note that the dynamics of the evolving European regulatory framework related to the determination and disclosure of Taxonomy eligible and aligned economic activities, as well as the continuous updating of the European Commission's interpretations in this regard, may require some revisions or reassessments, that could be reflected in a subsequent stage of the Annual Sustainability Report. 24 2. CONCLUSIONS FROM OUR ELIGIBILITY AND ALIGNMENT ANALYSIS In analyzing the activities of the companies in the scope of this reporting, we found that: ✓ The activity of Agria Group Holding JSC in terms of management and rental of its own office buildings and premises falls within the scope of Regulation 2021/2139, code 7.7. "Acquisition and ownership of buildings". In this regard, the company's activity is eligible under environmental objectives climate change mitigation and climate change adaptation; ✓ The activity of К ristera AD related to the provision of transport services falls within the scope of Regulation 2021/2139, code 6.6. "Freight transport services by road". As of the reporting year 2023 the company owns 10 vehicles category N3, falling under the scope of EURO IV, step E. In this regard, the company's activities carried out with the above-mentioned vehicles are eligible under environmental objectives climate change mitigation and climate change adaptation; ✓ The activity of AG Property Invest EOOD related to the implementation of investment projects falls within the scope of Regulation 2023/2486, code 3.1. "Construction of new buildings" from Annex II. In this regard, this activity of the company is eligible under environmental objective transition to a circular economy; ✓ The activity of Silk Gaz BG EOOD related to the provision of transport services falls within the scope of Regulation 2021/2139, code 6.6. "Freight transport services by road". As of the reporting year 2023 the company owns 10 vehicles category N3, falling under the scope of EURO IV, step E. In this regard, the company's activities carried out with the above-mentioned vehicles are eligible under environmental objectives climate change mitigation and climate change adaptation. For all Taxonomy-eligible activities we carried out a review for alignment with the technical screening criteria. As a result of the review, we may conclude that they should not be considered Taxonomy- aligned. Based on that, we will analyze in detail the available opportunities to allow us to determine the applicable measures and the time horizon for their implementation. 3. ACCOUNTING The definitions used for this reporting and the values determined by Key Performance Indicators (KPI) Turnover, Capital Expenses (CapEx) and Operating Expenses (OpEx) are based on the International Financial Reporting Standards (IFRS) and International Accounting Standards (IAS) as follows: KPI Turnover The denominator covers the net turnover at a consolidated level and is defined as per Article 2, point (5), of Directive 2013/34/EU. The turnover includes the revenue recognized pursuant to International Accounting Standard (IAS) 1, paragraph 82(a), as adopted by Commission Regulation (EC) No 1126/2008. The numerator covers the net turnover derived from products or services, including intangibles, associated with Taxonomy eligible economic activities. It is determined in accordance with IFRS 15 “Revenue from Contracts with Customers”. References to the related line items in the Annual Consolidated Financial Statement of Agria Group Holding JSC for the year 2023 are as follows: n ote 20 “Income from sales” and note 22” Other income”. 25 KPI CapEx The denominator covers costs that are accounted based on IAS 16 Property, Plant and Equipment, IAS 38 Intangible Assets, IAS 41 Agriculture, IFRS 16 Leases. Leases that do not lead to the recognition of a right-of-use over the asset are not counted as CapEx. The numerator covers capital expenditures defined in point (a) of Section 1.1.2.2 of Annex I to Regulation 2021/2178, namely: CapEx related to assets or processes that are associated with to Taxonomy-eligible economic activity. Companies within the scope do not have costs as of 2023 that can be attributed to points (b) and (c) of Section 1.1.2.2 of Annex I to Regulation 2021/2178. The reported CapEx for Silk Gas BG EOOD are related to the purchase of vehicles from category N3, falling under the scope of EURO IV, step E. References to the related line items in the Annual Consolidated Financial Statement of Agria Group Holding JSC for the year 2023: note 4 “ Property, plant and equipment ” and note 5 “ Intangible assets”. KPI OpEX The denominator covers all costs specified in section “Costs by economic elements” from the Annual Consolidated Financial Statement of Agria Group Holding AD for the year 2023 and respectively referred to note 23 “ Materials expenses ” , note 24 “Cost of services”, note 25 “ Personnel expenses ”, note 26 “Other expenses ” and note 27 “Impairment”. The numerator covers operational expenditures defined in point (a) of Section 1.1.3.2 of Annex I to Regulation 2021/2178, namely: OpEx related to assets or processes that are associated with Taxonomy-eligible economic activity. Companies within the scope do not have costs as of 2023 that can be attributed to points (b) and (c) of Section 1.1.3.2 of Annex I to Regulation 2021/2178. 4. KPIS CALCULATIONS – TURNOVER, CAPEX, OPEX Our calculations for Turnover, Capital and Operating Expenses are detailed in the following Appendices: Appendix I Proportion of turnover from products or services associated with Taxonomy-eligible economic activities; Appendix II Proportion of CapEX from products or services associated with Taxonomy-eligible economic activities; Appendix III Proportion of OpEx from products or services associated with Taxonomy-eligible economic activities. The activities "Acquisition and ownership of buildings" and " Freight transport services by road " are related to environmental objectives climate change mitigation and climate change adaptation. Having this in mind, we presented CapEx and/or OpEx separately for each environmental objective in the above-mentioned Appendices. To avoid double counting, OpEx for these activities is associated with the environmental objective adaptation to climate change. ……………………………………………… Emil Raykov Managing Director 26 APPENDIX I Proportion of turnover from products or services associated with Taxonomy-eligible economic activities 27 APPENDIX II Proportion of CapEX from products or services associated with Taxonomy-eligible economic activities 28 APPENDIX III Proportion of OpEx from products or services associated with Taxonomy-eligible economic activities 29 APPENDIX IV Active Certificates of the companies within the scope of current reporting Company Certificate № Issued by: System Validity Kristera AD EU-ISCC-CERT-PL214-06422132 BUEREAU VERITAS ISCC EU – RED II 26 May 2024 Almagest EOOD BG16/93127 SGS ISO 9001:2015 24 May 2025 Almagest EOOD BG16/93129 SGS HACCP 31 May 2025 Almagest EOOD BG16/93050 SGS ICH Q7 31 January 2025 Almagest EOOD EU-ISCC-Cert-PL-214-03602432 BUREAU VERITAS ISCC EU-RED II 6 August 2024 151 DECLARATION under Article 100n (4), Item. 4 of POSA We, the undersigned Emil Veselinov Raykov, in the capacity of Chairman of the Board of Directors and Executive Director of Agria Group Holding AD, and Asya Stancheva Yordanova, in the capacity of Accountant of Agria Group Holding AD, hereby declare that to the best of our knowledge: 1. The set of annual financial statements of 2023, prepared in compliance with the applicable accounting standards, provides true and fair information on the assets and liabilities, the financial standing and profit of Agria Group Holding AD and the companies included in the consolidation. 2. The report on the operations of Agria Group Holding AD for 2023 contains an accurate overview of the development and activity outcome of Agria Group Holding AD along with the state of the Issuer and the companies included in the consolidation, together with a description of the main risks and insecurities the Issuer is facing. Declarants: Emil Raykov – Executive Director ................................................... Asya Yordanova – Accountant .................................................... INDEPENDENT AUDITOR’S REPORT To the shareholders of Agria Group Holding AD Varna Report on the audit of the consolidated financial statements Qualified audit opinion 1. We have audited the consolidated financial statements of Agria Group Holding AD (the Group), comprising the consolidated statement of financial position as at 31 December 2023, the consolidated statement of profit or loss and other comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the year ending on that date, as well as the explanatory notes to the consolidated financial statement, also containing substantial information about the accounting policy. 2. In our opinion, except for the possible effects from the matters described in “Basis for qualified audit opinion” section of our report, the accompanying consolidated financial statements present fairly, in all material respects, the financial position of the Group as at December 31, 2023 and its financial performance and its changes in cash flows for the year then ended in accordance with the International Accounting Standards (IASs), approved for application by the European Commission (EC). Basis for qualified audit opinion 3. The Group has presented in the consolidated statement of the financial position as of December 31, 2023, a revaluation reserve in the amount of BGN 90,953 thousand. A part of it amounting to BGN 3,892 thousand was formed as a result of a one-time revaluation to fair value of part of the owned land and buildings in two of the Group's subsidiaries, carried out in previous periods by independent certified appraiserIn our opinion, a one-time valuation on only part of land and buildings owned by the Group is not in accordance with IAS 16 Property, Plant and Equipment , which requires a group of non-current assets to be subsequently measured in the financial statements using the same valuation method, as well as to determine their fair value with sufficient frequency so as to present fairly the changes in the value of assets in different periods. Thus, we are not able to determine whether the carrying amount of the revaluation reserve of the Group and related land and buildings as at 31 December 2023 has not been increased by the above amount and what the effects are on the net assets as at 31 December 2023 and the financial result of the Group for the year ending on that date. 2 4. As disclosed in note 9 of notes to the financial statements to the consolidated financial statements as of December 31, 2023, the Group owns inventories with a carrying amount of 149,421 BGN thousand, one part of which is goods (corn, wheat and barley) in the amount of 20,911 BGN thousand, the sales prices of which registered a decline as a result of the ongoing military conflict between Russia and Ukraine. As a result of the unfavorable market conditions in the first quarter of 2024, the Group has realized a loss from the sale of part of the goods available as of December 31, 2023 in the amount of BGN 2,408 thousand, with which the net realizable value of the assets owned as of this year has not been adjusted date goods. As a result of this, the carrying amount of the inventories available as of December 31, 2023 was overestimated by this value, accordingly, no deferred tax asset was formed in the amount of BGN 241 thousand, which led to an increase in the Group's net activities to December 31, 2023 and the financial result for the year ending with these data with BGN 2,167 thousand. 5. As disclosed in note 7 and note 10 in notes to the consolidated financial statement as of December 31, 2023, the Group has granted loans and receivables in the total amount of BGN 131,482 thousand. A part of them include non-current trade receivables in the amount of BGN 2,097 thousand and current receivables from customers for services provided in the amount of BGN 1,122 thousand. In the process of our audit, we were not able to satisfy ourselves to a sufficient extent that the above-stated receivables could be collected in full, despite the agreements reached to renegotiate the deadlines for their repayment. As a result, we could not obtain sufficient and persuasive audit evidence that the value of current and non- current receivables presented in the consolidated statement of financial position as of December 31, 2023 does not exceed their possible recoverable amount at that date and to what extent the Group's policy on accounting for expected credit losses has been correctly determined. 6. We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Group in accordance with the Code of Ethics for Professional Accountants issued by the International Ethics Standards Board for Accountants (IESBA Code), and the ethical requirements of the Independent Financial Audit Act (IFAA) that are relevant to our audit of the financial statements in Bulgaria, and we have fulfilled our other ethical responsibilities in accordance with the requirements of IFAA and IESBA Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Emphasis of matter 7. We draw attention to the disclosure in note 36, Other Disclosures: " At the end of February 2022, an armed conflict between Russia and Ukraine began in Europe. As a result, normal trade relations with the two affected countries have been greatly disrupted, and many countries in Europe, as well as the United States, have imposed several economic sanctions on Russia. All these events and measures could lead to changes in the prices of energy carriers and many other goods and services, as well as negatively affect 3 the global and European economy in the coming years, as well as negatively affect the Group's activities and lead to a change in investment plans . Our opinion is not modified concerning this matter. Key audit matters 8. Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements for the current period. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. Key audit matter How this key audit matter was addressed in our audit 1. Valuation to fair value of owned agricultural land Note 3.1 and note 4 to the consolidated financial statements. The Group has chosen to measure the agricultural land it owns at fair value, as determined by an independent appraiser as at the date of the financial statements. The measurement of agricultural land is an essential matter for our audit, as it requires a significant level of judgement and at the same time, agricultural land comprises a significant part of the Group’s assets. We have identified the use of many assumptions in the preparation of the measurements as a significant risk. The Group’s policy is to use external independent appraisers at least once a year. The measurements of the properties contain assumptions, for example expected rental income, employment rates, information about market transactions, market assumptions, risks related to property development, etc. 2. Valuation of right-of-use assets, including related to them lease obligations, according to the application of IFRS 16 Note 3.10, 4, and 15. of the consolidated financial statements. The business model of the Group includes performing agribusiness, which is associated with rent of big cultivable plots of land. The Our audit procedures in this area include: • studies on the objectivity, independence and expertise of the external appraisers; • we assessed the correctness of the input data contained in the appraisers’ reports; • we conducted a critical analysis of the major assumptions; • we performed additional procedures in order to assess the adequacy of the values received; we inspected the completeness and adequacy of the disclosures made in the financial statements with regard to the measurement of agricultural land Our audit procedures in this area include • Study and review the Group's internal rules to gain an understanding of key controls in significant business processes related to the rent of assets; • Study and review the Group's internal rules to gain an understanding of key controls in 4 number of the contracts signed is significant, as the rent contract’s structure is complicated in terms of time for which they are concluded, as well as the conditions for renewal. The complicated time structure of the rent contracts signed, as well as their conditions have been identified by us as a significant risk, related to the correct classification, valuation and disclosure of assets with right of use and the related to them obligations, in accordance with the applications of IFRS 16 significant business processes related to the rent of assets; • Procedures related to confirmation of fulfillment of the terms of the contracts; • Testing, through recalculation of certain calculations, used in determining the carrying amount of assets with right of use and the lease obligations, related to them.; • Analysis and valuation of used input data and significant estimates (discount rate, rent price, term of contract, etc.) in determining the amount of recognized assets and liabilities; • Reviewing the completeness and adequacy of the disclosures in the consolidated financial statements to determine whether they comply with the requirements of IFRS 16. Information other than the consolidated financial statements and auditor’s report thereon 9. The management is responsible for the other information. The other information comprises the annual management report and the corporate governance statement prepared by the management in accordance with Chapter Seven of the Accountancy Act, but does not include the consolidated financial statements and our auditor’s report thereon , and this other information we received before the date of our audit report. Our opinion on the consolidated financial statements does not cover the other information and we do not express any form of assurance conclusion thereon, unless explicitly stated in our report and to the extent stated. 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. As described: - in p.3 of the " Basis for expressing a qualified auditor's opinion " section above, we were not able to determine the value effect of the valuation adopted in previous periods of part of the land and buildings owned by the Group on their carrying value, respectively on the revaluation reserve and the Group's net assets. 5 - in p.5 of the " Basis for expressing a qualified auditor's opinion " section above, we were not able to determine the value effect of the adopted subsequent valuation of the non-current and part of the current receivables from customers presented in the consolidated statement of financial position. Accordingly, we are unable to reach a conclusion as to whether the other information is free of material misstatement with respect to these matters. In addition, as described in p.4 of the “ Basis for expressing a qualified auditor's Opinion ” section above, the Group has made a material misstatement in relation to the measurement of the carrying value of inventories as at 31 December 2023. We have concluded that the other information is materially misstated because of the impact of the effects of that material misstatement on the financial performance and related disclosures for that entity included in the other information. Responsibilities of management for the consolidated financial statements 10. The management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with International Accounting Standards, endorsed for application by the European Commission and for such internal control as the management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the consolidated financial statements, the management 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 the management either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so. Those charged with governance are responsible for supervision of the financial reporting process in the Group. Auditor’s respons ibilities for the audit of the consolidated financial statements 11. 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 auditor’s 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 IFAA and 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 scepticism throughout the audit. We also: 6 — identify and assess the risks of material misstatement of the 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 Management. — c onclude on the appropriateness of management’s 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 auditor’s report to the related disclosures in the 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 auditor’s 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 financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation. — obtain sufficient appropriate audit evidence about the financial information of the entities or entities within the Group to express an opinion on the consolidated financial statements. We are responsible for instructing, overseeing and performing the Group's audit. We have sole responsibility 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. We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards. 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 for the current period and are therefore the key audit matters. We describe these matters in our auditor's report unless a law or a regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication. 7 Report on other legal and regulatory requirements Additional matters to report in accordance with the Accountancy Act and Public Offering of Securities Act 12. In addition to our responsibilities and reporting in accordance with ISAs described above in “Information other than the consolidated financial statements and auditor’s report thereon” section with respect to the annual management report and the corporate governance statement, we have performed the procedures, in addition to those required under ISAs, in accordance with the Guidelines of the professional body of certified public accountants and registered auditors in Bulgaria – the Institute of Certified Public Accountants (ICPA). These procedures refer to checks of the existence, form and content of this other information in order to support us in forming an opinion whether the other information contains the disclosures required by Chapter Seven of the Accountancy Act and by the Public Offering of Securities Act (Art. 100m, par. 10 of the POSA in conjunction with Art. 100m, paragraph 8 (3) and (4) of the POSA), applicable in Bulgaria. Opinion in connection with Art. 37, par. 6 of the Accountancy Act Based on the procedures we have performed, our opinion is that: a) The information included in the annual management report for the financial year presented in the consolidated financial statements corresponds to those consolidated financial statements on which we have expressed a qualified opinion in “Report on the audit of the consolidated financial statements” section above. b) The annual management report has been prepared in accordance with the requirements of Chapter Seven of the Accountancy Act and Art. 100m, par 7 of the Public Offering of Securities Act. c) The declaration for corporate governance for the financial year presented in these consolidated financial statements, which is part of the annual management report, contains the information required by Chapter Seven of the Accountancy Act and Art. 100m, par. 8 of the Public Offering of Securities Act. (d) The non-financial declaration is presented and prepared in accordance with the requirements of the Accountancy Act. Opinion in connection with Art. 100m, par 10 in conjunction to Art. 100m, par 8, points 3 and 4 of the Public Offering of Securities Act Based on the procedures performed and the knowledge and understanding obtained of the Group ’s activities and the environment in which it operates, in our opinion, the description of major characteristics of the Group’s internal control and risk management systems relevant to the financial reporting process which is part of the corporate governance statement and the information under Art. 10 paragraph 1(c), (d), (f), (h) and (i) of Directive 2004/25/EC of the European Parliament and the Council of 21 April 2004 on Takeover Bids, do not contain any material misrepresentations. 8 Reporting on compliance with the electronic format of the consolidated financial statements included in the annual consolidated financial statements for the activity under art. 100n, para 5 of Public offering of securities Act (POSA) with the requirements of EEEF Regulation We are committed to expressing a reasonable degree of certainty regarding the compliance of the electronic format of the consolidated financial statements of Agria Group Holding AD for the year ending December 31, 2023, attached to the electronic file „ 8945006WNW5407G58156-20231231-BG-CON.zip “, with the requirements of Commission Delegated Regulation (EU) 2019/815 of December 17, 2018 supplementing Directive 2004/109 / EC of the European Parliament and of the Council through regulatory technical standards on the definition of the uniform electronic reporting format "EEF Regulation" ). Our opinion is only regarding the electronic format of the consolidated financial statements and does not cover the other information included in the annual consolidated financial statements for the activity under Art. 100n, para. 5 of the POSA. Description of the subject and applicable criteria The management has prepared an electronic format of the consolidated financial statements of the Group for the year ended December 31, 2023 under the EEEF Regulation in order to comply with the requirements of the POSA. The rules for the preparation of consolidated financial statements in this electronic format are set out in the EEEF Regulation and, in our view, have the characteristics of appropriate criteria for forming a reasonable assurance opinion. Responsibilities of management and those charged with governance The management of the Group is responsible for applying the requirements of the EEEF Regulation when preparing the electronic format of the consolidated financial statements in XHTML. These responsibilities include the selection and application of appropriate iXBRL markings using the taxonomy of the EEEF Regulation, as well as the introduction and implementation of such internal control system as management deems necessary for the preparation of the electronic format of the Group's annual consolidated financial statements. does not contain significant inconsistencies with the requirements of the EEEF Regulation. The persons in charge of general management are responsible for overseeing the process of preparing the Group's annual consolidated financial statements, including the implementation of the EEEF Regulation. Auditor's responsibilities Our responsibility is to express an opinion on the reasonable level of certainty as to whether the electronic format of the consolidated financial statements is in conformity with the requirements of the EEEF Regulation. To this purpose, we have complied with the Guidelines on the Audit Opinion on the Implementation of the Single European Electronic Format (EEEF) for the Financial Statements of Companies "whose securities are admitted to trading on a regulated market in the European Union (EU)" 9 of the professional organization. of Registered Auditors in Bulgaria, Institute of Certified Public Accountants (ICPA) "and we have committed to expressing a reasonable level of assurance in accordance with IAS 3000 (revised) Assurance Exercises Other than Audits and Reviews of Historical Financial Information" (IPSAS 3000 (revised)) “Assurance engagements other than audits and reviews of historical financial information” (IAS 3000 (revised)). This standard requires us to comply with ethical requirements, plan and perform appropriate procedures to obtain reasonable assurance whether the electronic format of the Group's consolidated financial statements has been prepared in all material respects in accordance with the applicable criteria set out above. The nature, timing and scope of the procedures selected depend on our professional judgment, including the assessment of the risk of material non-compliance with the requirements of the EEEF Regulation, whether due to fraud or error. A reasonable level of assurance is a high level of assurance, but there is no guarantee that a commitment made in accordance with IAS 3000 (revised) will always reveal a material non-compliance where applicable. Requirements for quality control We apply the requirements of the International Standard on Quality Control (ISQC) 1 and, accordingly, maintain a comprehensive quality control system, including documented policies and procedures regarding compliance with ethical requirements, professional standards and applicable legal and regulatory requirements for registered auditors in Bulgaria. We meet the ethical and independence requirements of the International Code of Ethics for Professional Accountants (including International Standards of Independence) of the International Ethics Standards Board for Accountants (CMSA Code), adopted by institute of Certified Public Accountants (ICPA) through Independence Financial Audit Act (IFAA). Summary of work performed The purpose of the procedures planned and performed by us was to obtain a reasonable degree of assurance that the electronic format of the consolidated financial statements has been prepared, in all material respects in accordance with the requirements of the EEEF Regulation. As part of our assessment of compliance with the EEEF Regulation's electronic (XHTML) format for reporting on the Group's consolidated accounts, we maintained professional skepticism and used professional judgment. We also: — obtained an understanding on the internal control and the processes, related related to the application of the EEAS Regulation in relation to the Group's consolidated financial statements and including the preparation of the Group's consolidated financial statements in XHTML format and its markup in machine-readable language (iXBRL); — checked if the applied XHTML format is valid; — checked if the applied XHTML format is valid; 10 — assessed the completeness of the markings in the consolidated financial statements of the Group in the use of machine-readable language (iXBRL) in accordance with the requirements of the EEEF Regulation; — assessed the appropriateness of the iXBRL markings selected from the main taxonomy used, as well as the creation of an extended taxonomy element in accordance with the EEEF Regulation where there is no appropriate element in the basic taxonomy; — assess the appropriateness of the correlation (fixation) of the elements of the extended taxonomy in accordance with the EEEF Regulation. We believe that the evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Opinion on the compliance of the electronic format of the consolidated financial statements with the requirements of the EEEF Regulation In our opinion, based on the procedures performed by us, the electronic format of the consolidated financial statements of Agria Group Holding AD for the year ended 31 December 2023, on which the consolidated financial statements we express a modified audit opinion contained in the attached electronic file „ 8945006WNW5407G58156-20231231-BG-CON.zip “, has been prepared in all material aspects in accordance with the requirements of the EEEF Regulation. Reporting according to art. 10 of Regulation (EU) № 537/2014 in connection with the requirements of Art. 59 of the Independent Financial Audit Act According to the requirements of the Independent Financial Audit Act in connection with Art. 10 of Regulation (EU) № 537/2014, we also report the following information. Primorska Audit Company Ltd. has been appointed as a mandatory auditor of the consolidated financial statements of Agria Group Holding AD (the Company) for the year, ending December 31, 2023 by the general meeting od the Group held on June 26, 2023 for a period of one year. The audit engagement was accepted by a letter dated October 17, 2023. The audit of the consolidated financial statements for the year ended December 31, 2023 of the Group represents the third full ongoing engagement to a statutory audit of this entity performed by us. We confirm that the audit opinion expressed by us is in accordance with the additional report submitted to the audit committee of the Group, in accordance with the requirements of Art. 60 of the Independent Financial Audit Act. We confirm that we have not provided the information specified in Art. 64 of the Independent Financial Audit Act prohibited services outside the audit. 11 We confirm that in performing the audit we remained independent from the Group. For the period covered by our statutory audit, other than the audit, we have not provided services to the Group and its controlled entities that are not specified in the Group's activity report or consolidated financial statements. Audit company Primorska Audit Company OOD Registration number 086 Iliya Iliev Managing partner Marian Nikolov Registed auditor, responsible for the audit Registration number 0601 April 29, 2024