COMPANY ANNOUNCEMENT

The following is a Company Announcement issued by MaltaPost p.l.c. (the Company) pursuant to the Capital Market Rules of the MFSA.

QUOTE

The Board of Directors of MaltaPost p.l.c. today approved the audited financial statements for the financial year ended 30 September 2021 and resolved that these statements be submitted for approval at the forthcoming Annual General Meeting to be held on 16 February 2022. The attached Annual Report is being published in terms of the Capital Markets Rules of the MFSA.

The Board of Directors further resolved to recommend for the Annual General Meeting, the payment of a final gross dividend of €0.0615 (Net: €0.04) per nominal €0.25 share.

The dividend, if approved at the Annual General Meeting, will be paid on 16 March 2022 to shareholders on the Company's share register at the Central Securities Depositary of the Malta Stock Exchange as at close of business of 17 January 2022.

Shareholders on the Company's share register at the Central Securities Depositary of the Malta Stock Exchange as at close of business of 17 January 2022 will receive the notice of the Annual General Meeting.

UNQUOTE

Graham A. Fairclough Company Secretary

20 December 2021

MALTAPOST p.l.c.

Annual Financial Report and Consolidated Financial Statements

30 September 2021

Pages

Chairman's statement to the members	1 - 2
Chief Executive Officer's review of operations	3 - 5
Directors' report	6 - 13
Statement of compliance with the principles of good corporate governance	14 - 22
Remuneration report	23 - 24
Company information	25 - 26
Independent auditor's report	27 - 37
Statements of financial position	38 - 39
Income statements	40
Statements of comprehensive income	41
Statements of changes in equity	42 - 45
Statements of cash flows	46
Notes to the financial statements	47 - 94
Five year summary	95
Financial highlights in major currencies	96
Supplementary information	97 - 99

Chairman's statement to the members

In a period of unprecedented worldwide upheaval arising from the continued impact of the COVID-19 pandemic, it is reassuring to note that MaltaPost responded well to the challenges it faced in the year under review. Against this background your board of directors is pleased to report a satisfactory set of results in respect of the financial year ended 30 September 2021 which show a pre-tax profit for the year of €2.35 million. The decrease of 15% over the previous year is to be viewed in the context of the global pandemic which, apart from health considerations, also continues to threaten world economies.

Earnings per Share remain constant allowing your Board to propose a final net dividend of €0.04 per nominal €0.25 share at the Annual General Meeting.

Shareholders' Funds stand at €28.37 million, ensuring that the Group remains well positioned to progress its diversification strategy and investment programme, which includes increasing our fleet of electric delivery vehicles, operational infrastructure enhancements and strengthening of the post office network, so as to meet customer expectations and facilitate the introduction of new services. Concurrently, we remain committed to diversifying our business through ventures in the insurance sector. Investment in our IT infrastructure continued to enable the Company to efficiently handle additional demands arising from Customs and Regulatory requirements and consistent and accelerating industry changes.

We continue to play a central role in the Maltese economy and in the daily life of the community. However, MaltaPost remains unfairly expected to deliver certain services at significant financial loss. This is a situation that has been accentuated by the continued fall in Letter Mail volumes more so since the outbreak of the pandemic. In this regard, we seek to liaise closely with the Malta Communications Authority in a continuous effort to find reasonable solutions. MaltaPost simply cannot be expected to continue fulfilling certain services at a financial loss.

Following the introduction earlier this year of virtually insignificant postal tariff revisions, the Company still awaits the approval of the Malta Communications Authority to implement pricing revision requests some of which were first proposed three years ago. Therefore, such a tariff revision is necessary to address the loss-making postal services we provide under the Universal Service Obligation. These losses have been accentuated as a result of the year-on-year shrinkage in Letter Mail volumes as well as to cushion the impact of increasing labour and operating costs.

The tariffs of mail services in Malta remain significantly lower compared to all other European jurisdictions even though we are an island-nation and totally dependent on the more expensive air connectivity routes. The shift to an increasingly e-commerce-oriented environment underlines the need for us to continuously adapt our local and international product and service offerings.

During this financial year much of the focus of our management team centred around the response to the pandemic while implementing various international regulatory requirements resulting from Brexit and the decision by the EU to remove the exemption from VAT, of goods originating from outside the EU irrespective of amount.

Notwithstanding the challenges, we shall continue in our endeavour to deliver a high-quality service, a fair return to our shareholders and to provide a secure and rewarding workplace for our staff complement that now exceeds 830 persons.

Chairman's statement to the members - continued

My fellow board directors join me in expressing our sincere appreciation to the staff and management at MaltaPost for their dedication and commitment. I also thank my fellow directors for their valued contribution and support throughout the year. Sincere thanks are also extended to our customers for their continued trust and confidence, and you, the shareholders, for your consistent support.

We strongly believe that the Group shall continue to be resilient while remaining responsive to the opportunities that arise and to evolving market circumstances.

Joseph Said Chairman

Chief Executive Officer's review of operations

The MaltaPost Group financial results for the financial year ended 30 September 2021 include the financial performance of MaltaPost p.l.c., together with its subsidiary and associate companies.

REVIEW OF FINANCIAL PERFORMANCE

In a year of continued and significant disruption arising from the spread of the COVID-19 pandemic, the Company achieved a Group Profit before tax of £2.35 million, a decrease of 15% when compared to the previous year's €2.78 million.

Group Total Revenue for the year increased by 11% to €37.93 million (2020: €34.09 million) with that of postal revenue remaining constant at 87%. Other non-postal income arose from document services, bill collection, financial services and insurance.

Group Total Expenses stood at €35.82 million (2020: €31.72 million) driven by increases in international postal tariffs payable to postal operators at destination as set by the Universal Postal Union as well as increases of over 50% in airfreight costs. We also experienced increases in the local cost of labour as per our Collective Agreement, coupled with the challenges we continue to face to recruit and retain staff.

OPERATIONAL PERFORMANCE

The national measures taken to mitigate the spread of the pandemic resulted in a further drop in traditional postal volumes - a reality that was experienced globally throughout the postal sector. Cross-border inbound and outbound postal volumes were also affected by a reduction in airline flights. This lack of connectivity resulted in unpredictability in the quality of service provided.

Last summer, our regulator, the Malta Communications Authority, approved very limited tariff increases which had minimal impact on our revenue. The tariff revisions approved were far below what was requested within a context where tariffs of Letter Mail services in Malta remain the European region. We are disappointed that we remain inadequately compensated for the highly onerous range of universal services we provide to the general public and in spite that it is not commercially viable to do so.

The activity of inbound parcel volumes continued to attract strong local and international competition creating constant pressure on tariffs and quality of service requirements. We remain committed to be the partner of choice and in this regard are regularly our processes to meet the ever-increasing demands and expectations of our customer base. We continue to re-engineer our operations to increase delivery capacity and improve efficiency. Nine further electric vehicles were acquired during the year and we are expecting delivery of forty electric vehicles early next financial year. These changes also bring about improvements in the working conditions and well-being of our delivery staff. Cost management and cost-efficiency efforts continued throughout the year.

Furthermore, during the past year the Company had to deal with a major change in its operations due to the implications of Brexit and the EU's decision to withdraw VAT exemption on all items valued below €22 and bought from outside the EU. We are also proud to report that our full network of Post Offices remained open for business throughout the most challenging times of the pandemic. We also continued our last mile deliveries without any major interruptions six days a week. These results are strong testimony to the determination of our work force and the skill and the tenacity of the management team in navigating through this year of turbulence.

Chief Executive Officer's review of operations - continued

NEW PROJECTS AND INTIATIVES

Post Offices were opened for business in Attard and Fgura while our Post Office in St. Julians was completely refurbished. Finishing works on a new property to serve as a Post Office in Zejtun are underway. This property shall replace the existing Post Office of the locality.

The nationwide EasiPik parcel locker network was increased to 24 locations available 24/7 across Malta and Gozo mostly located in our Post Offices. They continue to provide a flexible, convenient and yet free-of-charge collection option to customers.

Major IT projects triggered by EU Customs and Regulatory requirements were implemented.

Our investment in digital transformation is facilitating access to our products and services and driving our response to meet the ever-growing local and international customer expectations.

CORPORATE SOCIAL RESPONSIBILITY

The Group continued to extend its support to the Malta Community Chest Fund, Id-Dar tal-Providenza and other select social and cultural organisations.

We also continue to help preserve Malta's postal heritage in the running of the Malta Postal Museum through the newly established foundation 'Fondazzjoni Muzew tal-Posta' whose aim is to protect and promote postal heritage and history for the benefit of future generations.

Our continued investment in our fleet of electric vehicles also confirms our commitment to reducing our carbon footprint by minimising our impact on the environment.

OUTLOOK

We are set for another challenging year where forecasts are difficult to make following the onset of yet another COVID-19 variant. The pandemic has accelerated the postal trends we have been seeing for the past years as parcel volumes continue to increase while Letter Mail maintains its downward turn. This reaffirms the belief that our strategy to rebalance our service offering towards the parcel sector is the right one. Furthermore, the highly onerous Universal Service Obligation must be become sustainable as we simply cannot continue to carry an unfair financial burden in providing the services covered by the Obligation.

While we reaffirm our commitment to make postal services more accessible to all, we cannot be expected do this at a financial loss and in an environment wherein tariff revisions cannot be carried out unless and until these are approved by the Malta Communications Authority. We shall continue to request that the Authority revise the pricing of our loss-making services and that a three-year tariff revision programme be agreed upon. This will ensure that the Company can plan ahead to remain in a position to provide services by making the necessary capital investment to sustain the long-term viability of the Universal Service Obligation.

Chief Executive Officer's review of operations - continued

We shall also continue to manage the non-postal sectors of the business to further supplement our core activity with distinct revenue streams. We are confident that our diversification into logistics, document management, insurance and financial services bodes well for the future and shall provide a fair return on investment. The foundations are being laid to make the Company stronger.

Finally, I wish to thank the Board of Directors for their strategic guidance and support; our shareholders and customers for their solidarity throughout the pandemic; and our staff and management team who by working harmoniously together continue to steer the Company successfully.

Joseph Gafa' Chief Executive Officer

Directors' report

The Directors present their annual financial report and the consolidated audited financial statements of MaltaPost p.l.c. for the year ended 30 September 2021.

PRINCIPAL ACTIVITIES

The MaltaPost Group comprises MaltaPost p.l.c. (the Company) and its subsidiary companies, Tanseana Limited (Tanseana), Ciantar Brothers Limited, Postalnsure Agency Limited (Postalnsure), and its associate company IVALIFE Limited.

MaltaPost p.l.c. was registered in 1998 and listed on the Malta Stock Exchange (MSE) in 2008. The Company is a public limited liability company under the provisions of the Companies Act (Cap. 386).

As the designated Universal Service Provider, MaltaPost provides a series of universal postal services in terms of the Postal Services Act (Chapter 254 of the Laws of Malta) and in line with the terms of the Universal Postal Union on behalf of the Government of Malta. It is regulated by the Malta Communications Authority. The Company operates a network of 6 Postal Hubs, 42 Post Offices and 26 Sub-Post Offices around Malta and Gozo providing an extensive range of postal and financial services.

Tanseana, a company wholly owned by MaltaPost, was registered and commenced operations in 2016. The company was established to provide document management services and to carry on such services which include, but are not restricted to, scanning, printing, shrage and retrieval of digital and/ or physical documents.

Ciantar Brothers Limited, a company wholly owned by MaltaPost, provides warehousing services.

Postalnsure, a company 49% owned by MaltaPost p.l.c. was granted enrolment in the agents list to act as an insurance agent under Article 13 of the Insurance Intermediaries Act (CAP 487).

IVALIFE Insurance Limited, formerly IVALIFE Limited, a company 25% owned by MaltaPost p.l.c. was licensed on 1 February 2021 to provide Class I and Class III long term business of insurance.

REVIEW OF PERFORMANCE

Profit before tax registered amounted to €2.35 million, a decrease of 15% when compared to last year's €2.78 million, resulting in an Earnings per Share of €0.04.

Revenue increased to €37.93 million). Postal revenue represented 87% of total revenue, while the balance stemmed from non-postal services such as document management, bill collection and financial services.

Total expenses increased to €35.82 million (2020: €31.72 million) in line with increases in revenue, as well as a result of increases in employee expenses increased by 7% to €16.17million (2020: €15.17 million).

Remuneration policy

Details of total employee expense for the year and the average number of persons employed by the Company, including part- timers, during the year is included in Note 22 to the financial statements.

Information on the Company's remuneration policy and practices is disclosed in the Remuneration Report within the Annual Financial Report on page 23. The Remuneration Report will be subject to an advisory vote at the forthcoming Annual General Meeting.

Social and employee matters

The Company is aware that a professional approach to appointments within the Company helps it to attract those individuals having the necessary qualifications, skills and attributes compatible with achieving its overall objectives.

Thus, the Company ensures that appointments at all levels are based on each individual's knowledge, skills, expertise and merit, as required by Maltese legislation and in line with best practice.

Bearing its objectives in mind, the Company acknowledges the benefit of appointing directors with diverse skills and expertise that allow the Board to create value for shareholders by ensuring that the specific risks as well as risks that are intrinsic to its business are appropriately managed and mitigated within the Board's risk appetite. The Company will continue to promote this diversity by recruiting the ideal individual for any vacant position that may arise.

Taking cognisance of the Company's size and business model, it considers that as a policy it endeavours to have a varied Board, particularly in terms of diverse educational and professional backgrounds as well as extensive and specialised experience. It is confident that for this reason and in light of the fact the Company is controlled by Lombard Bank Malta p.l.c., it benefits from satisfactory diversified views and expertise which allows for a good understanding of current affairs, the environment in which the Company operates and long-term risks and opportunities related to the Company's business.

The Company remains committed to achieving further diversity among its Board members.

The Company is an equal opportunities employer as certified by the local authorities through the Equality Certification Mark. The Company's policy is to:

· eliminate any forms of discrimination;
· deal with any incidents of inappropriate behaviour;
· promote equal opportunities for all employees;
· create an environment in which the individual characteristics of all employees are recognised and valued.

All applications for employment are given full and fair consideration, due regard being given to the aptitude and ability of the individual and the requirements of the position concerned. All staff are treated on equal terms with regard to training, career development and promotion. The employment of people with special needs far exceeds the obligation of 2% set under the Persons with Disability (Employment) Act, 1969. The Company is committed to ensure the highest safety standards and safe practices for its employees, management and contractors and members of the public in accordance with the Occupational Health and Safety Authority Act, (Cap. 424 of the Laws of Malta), 2000. Conscious of the fact that legal obligations are the minimum acceptable standard, the Company is striving for excellence in this area and is continuing to increase awareness among employees and contractors.

The Statement of Compliance with the Principle of Good Corporate Governance in this Annual Financial Report, describes the non-finance indicators relevant to the Group, including information relating to employee and environmental matters.

The Company aims to minimise the environmental impact of our business operations. Being environmental friendly also contributes to manage costs. Such initiatives include the installation of solar panels and the continued investment in a new fleet of electric last mile delivery vehicles.

Further information in respect of these matters is disclosed within the Directors' Report in the Annual Financial Report and Financial Statements of the Company's parent, Lombard Bank Malta p.l.c. in terms of paragraph 10 of the Sixth Schedule (Article 177) of the Companies Act Cap. 386,

OUR PRINCIPAL RISKS AND UNCERTAINTIES

Traditional mail evolution

MaltaPost is the designated Universal Service Obligation provider in Malta. It is responsible to deliver various postal services to the public including the clearance and delivery of letters and packages six days a week both domestically and internationally even when the costs involved render such select services not financially viable.

Furthermore, the same obligations of the Universal Postal Service have for years been conditioned by a year on year decline in both Domestic and Outbound Single-Piece and Bulk Mail volumes due to esubstitution. A decline that was further accelerated by the measures taken to contain the spread of the pandemic and which led to further digitization and e-substitution.

In addition to the year-on-year decline in traditional mail volumes, the Company also had to manage three further challenges to its core business model during the past year. It had to deal with the measures introduced to contain the spread of the COVID-19 pandemic which measures led to significant loss of business and revenue. Then, in the midst of the pandemic we had to manage the impact of Brexit where a drop in postal traffic from the UK was experienced. Last but not least, inbound postal volumes took a hit as a consequence of the EU's decision to withdraw VAT exemption on all items bought from outside the EU and costing below €22.

It is for these reasons that the Company has once again requested the Regulator to approve tariff revisions that are aligned with the real cost of providing both single and bulk mail services and the outbound mail services in order to safequard the viability of the Universal Postal service going forward.

Intensifying competition in international business

The last mile delivery of inbound business in Malta is becoming increasingly competitive. A situation driven by relatively low barriers to entry, the attractiveness of growth in eCommerce volumes and the presence of competitors that are unburdened by regulatory and universal service costs and obligations.

Inability to maintain staff resourcing in line with business needs

Our performance and our operating as well as our future growth depend on our ability to attract and retain staff with the appropriate level of knowledge and experience. This is becoming more challenging as time passes and is placing unneccessary wage pressure emboldened by labour shortages and rising living costs.

Legislative and/or regulatory repercussions

The Company strives to comply with a wide and diverse set of laws and regulations. This is set to increase in line with the Company's diversification initiatives in highly regulated industries. Failure to comply could translate in regulatory scrutiny, liabilities for both the Company and its Directors as well as reputational damage.

Financial risk management

The Company's activities potentially expose it to a variety of financial risks: market risk (including foreign exchange risk, cash flow and fair value interest rate risk), credit risk, and liquidity risk. The Company's overall risk management, covering risk exposures for its subsidiaries, focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the respective Company's financial performance. The Audit and Risk Committee has overall responsibility for the establishment and oversight of the Company's risk management framework. Accordingly, the Committee provides principles for overall risk management, as well as risk management policies in line with the risk apetite covering the risks referred to above. A detailed review of the risk management policies employed by the Company is included in Note 2 to the financial statements.

RESULTS AND DIVIDENDS

The income statements are set out on page 40. The Directors recommend the payment of a final net dividend of €0.04 per share amounting to €1,506,189 (2020:€1,506,189).

CAPITAL

The Authorised Share Capital of the Company was fourteen million euro (€14,000,000) made up of fifty-six million (56,000,000) ordinary shares of a nominal value of €0.25 each. The Issued and Fully Paid Up Share Capital was nine million, four hundred and thirteen thousand, six hundred and eighty euro (€9,413,680) made up of thirty-seven million, six hundred and fifty four thousand, seven hundred and twenty (37,654,720) ordinary shares of a nominal value of €0.25 each, all of one class.

BOARD OF DIRECTORS, OFFICERS AND SENIOR MANAGEMENT

The Directors of the Company who held office during the year were:

Joseph Said (Chairman) David P. Attard James Dunbar Cousin Graham A. Fairclough Eugenio Farrugia Paul Muscat Aurelio Theuma

In accordance with the Company's Articles of Association, a member of the Company holding, or number of members, who between them hold, such number of equity securities having voting rights as may be sufficient to constitute one or more qualifying holdings, shall be entitled to appoint one (1) director for every qualifying holding held. Other members shall be entitled to participate and vote in an election of directors to take place once in every year at a general meeting of the Company. Unless appointed for a longer or shorter period, or unless they resign or are removed, directors, unless otherwise specified in the letter of their appointment, hold office for a period of one year. Notwithstanding the period for which a director has been appointed, on the lapse of such period a director will be eligible for re-appointment. An election of directors shall take place every year, if there are vacancies on the board which are not filled by the appointment of directors by the member holding, or number of members who between them hold, such number of equity securities having voting rights as may be sufficient to constitute one or more qualifying holdings. The composition of Officers and Senior Management is further disclosed under section 'Company Information'. Further information is also given in the 'Statement of Compliance with the Principles of Good Corporate Governance'.

DIRECTORS' STATEMENT OF RESPONSIBILITIES IN RELATION TO THE FINANCIAL STATEMENTS

The Directors are required by the Maltese Companies Act (Cap. 386) to prepare financial statements which give a true and fair view of the state of affairs of the Company as at the end of each reporting period and of the profit or loss for that period.

In preparing the financial statements, the Directors are responsible for:

· ensuring that the financial statements have been drawn up in accordance with International Financial Reporting Standards as adopted by the EU;
selecting and applying appropriate accounting policies;
making accounting estimates that are reasonable in the circumstances;
ensuring that the financial statements are prepared on the going concern basis unless it is inappropriate to presume that the Company will continue in business as a going concern.

The Directors are also responsible for designing, implementing internal controls relevant to the preparation and the fair presentation of the financial statements that are free from material misstatement, whether due to fraud or error, and that comply with the Maltese Companies Act (Cap. 386). They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

The financial statements of MaltaPost p.l.c. for the year ended 30 September 2021 are included in the Annual Financial Report 2021, which is published in hard-copy printed form and made available on the Company's website. The Directors are responsible for the maintenance and integrity of the Annual Financial Report on the website in view of their responsibility for the controls over, and the security of the website.

Access to information published on the Company's website is available in other countries and jurisdictions, where legislation governing the preparation and dissemination of financial statements may differ from requirements or practice in Malta.

STATEMENT OF THE DIRECTORS PURSUANT TO CAPITAL MARKETS RULE 5.68

The Directors confirm that, to the best of their knowledge:

· the financial statements give a true and fair view of the financial position of the Company as at 30 September 2021, and of its financial performance and its cash flows for the year then ended in accordance with International Financial Reporting Standards as adopted by the EU; and
the Annual Financial Report includes a fair review of the development and performance of the business and the position of the Company, together with a description of the principal risks and uncertainties that they face.

INFORMATION PROVIDED IN ACCORDANCE WITH CAPITAL MARKETS RULE 5.70.1

There were no material contracts to which the Company or any of its subsidiaries were a party, and in which any one of the Company Directors was directly or indirectly interested, except for transactions listed in the notes to the financial statements.

GOING CONCERN BASIS

After making due enquiries, the Directors have a reasonable expectation, at the time of approving the financial statements, that the Company has adequate resources to continue in operational existence for the foreseeable future. For this reason, the Directors continue to adopt the going concern basis in preparing the financial statements.

CAPITAL MARKETS RULES DISCLOSURES

In terms of the Capital Markets Rule 5.64, the Directors are required to disclose the following information:

Amendments to the Memorandum and Articles of Association are effected in conformity with the provisions in the Companies Act (Cap. 386). Furthermore, in terms of the Articles of Association of the Company:

(a) Directors may be authorised by the Company to issue shares subject to the provisions of the Memorandum and Articles of Association and the Companies Act (Cap. 386);
(b) Directors may decline to register the transfer of a share (not being a fully paid share) to a person of whom they shall not approve;
(c) Directors may decline to recognise any instrument of transfer, unless accompanied by the certificate of the shares of which it relates, and/or such other evidence;
(d) no registration of transfer of shares shall be made and no new particulars shall be entered in the register of members when the register is closed for inspection;
(e) the Company may, from time to time, by extraordinary resolution reduce the share capital and any share premium account in any manner.

Currently there are no matters that require disclosures in relation to:

(a) holders of any securities with special rights;
(b) employee share schemes;
(c) restrictions on voting rights or relevant agreements thereto;
(d) agreements pertaining to the change in control of the Company;
(e) any agreements between the Company and its Directors or employees providing for compensation if they resign or are made redundant without valid reason or if their employment ceases because of atakeover hid

The exercise of any share buy back option by the Directors requires the passing of an extraordinary resolution.

NON-FINANCIAL INFORMATION

Information in respect of the above matters is disclosed within the Directors' Report in the Annual Financial Report and Financial Statements of the Company's parent i.e. Lombard Bank Malta p.I.c.

The Company's capital structure, direct and indirect shareholding in the Company, in excess of 5% and the rules governing the changes to the Board members are contained in other parts of this Annual Financial Report.

The only shareholder holding 5% or more of the Issued Share Capital of the Company is Redbox Limited which owned 71.5% as at 30 September 2021 and 3 December 2021.

OTHER INFORMATION

COVID-19 PANDEMIC

The Company implemented its contingency plans to manage the impact of the COVID-19 pandemic. This was executed in line with its Risk Assessment and Management Policies and in full respect of the directives and recommendations issued by Government of Malta, the Public Health Authorities as well as the Regulators.

The spread of the COVID-19 pandemic at MaltaPost remains contained, reflecting the situation at a national level. Sporadic though regular positive cases continue to be reported amongst our employees. More significantly, a number of employees continue to be placed on forced quarantine as a consequence of positive cases being reported outside the operation of the Company. These force majeure' circumstances continue to impact but not disrupt our day-to-day postal operations.

In fact, the Company was able to provide all the Universal Postal Services normally delivered whilst keeping its network of 42 Post Offices spread across the whole Maltese islands fully functional. Select delays were experienced at irreqular intervals in the incoming and outgoing cross-border mail and parcel sectors due to circumstances beyond the company's control. During these challenging times, staff members showed loyalty and dedication to duty as we strove to protect their safety together with their wellbeing on the priority list.

Despite a relative though marginal increase in the number of airline scheduled flights into and out of Malta, the number of mail-carrying flights operated by scheduled airlines remains well below the number of flights operated. This reality has left us with less international cross-border conveyance options to utilize, resulting in an increase in airline conveyance costs.

The Company continues to monitor developments on a day-to-day basis and continued to update its operational and contingency plans as circumstances dictate.

In this respect, the Company is cognisant of its obligations towards all its stakeholders and this remains a priority at all times. Any material developments will be advised as they occur through Company Announcements and/or interim Directors' Financial Reporting Disclosures.

AUDITORS

PricewaterhouseCoopers have indicated their willingness to continue in office and a resolution for their reappointment will be proposed at the Annual General Meeting.

By order of the Board

Joseph Said Chairman

Aurelio Theuma Director

Registered office 305, Qormi Road, Marsa, MTP 1001 Malta

20 December 2021

As a company having its securities admitted to trading on a regulated market, MaltaPost p.l.c. is obliged to report on the extent to which it has adopted the Code of Principles of Good Corporate Governance (the 'Principles') during the period under review, as specified in Appendix 5.1 to Chapter 5 of the Malta Financial Services Authority Capital Markets Rules. The following report highlights the extent to which the Code has been adopted, as well as the reasons for any departure from the Code.

Although compliance with the Code is not mandatory, the Board of Directors of MaltaPost p.l.c. firmly believes that adoption of the Principles ensures the required standards of accountability, transparency and probity, all of which go to safeguard the very best interests of all the Company's stakeholders.

A. COMPLIANCE WITH THE CODE

PRINCIPLE 1: THE BOARD

The Board of Directors is composed of the Chairman and six (6) Directors, six (6) of whom are nonexecutive. Five (5) of the Directors are employed with the ultimate parent Company. While the Board of Directors is elected by the shareholders as stipulated in the Company's statute, the Chairman is elected by the Directors from amongst themselves during the first Board Meeting following the Annual General Meeting. Any Director (other than an alternate Director) may in writing appoint any person who is approved by the majority of the Directors, to be his alternate to act in his place at any meeting of the Directors at which he is unable to be present.

The main responsibility of the Board is to set the strategic direction of the Company and to provide the necessary oversight to ensure adherence to the agreed strategies.

In so doing the Board delegates certain responsibilities to a number of Board committees, notably the Audit and Risk Committee, the Assets and Liabilities Committee and the Remuneration Committee, all of which are regulated by their own terms of reference as approved by the Board of Directors. The Directors possess the necessary skills and competencies to enable them to discharge their responsibilities with integrity, honesty, prudence and professionalism.

PRINCIPLE 2: CHAIRMAN AND CHIEF EXECUTIVE OFFICER

The post of Chairman and that of Chief Executive Officer are held by different individuals. The separation of roles is intended to differentiate between the role of the Chairman as the leader of the Board of Directors and that of the Chief Executive Officer who is responsible for the agreed strategies as well as the day-to-day management of the Company. This separation of roles is meant to ensure that no one individual or small group of individuals have unfettered powers of decision.

PRINCIPLE 3: COMPOSITION OF THE BOARD

The following Directors served on the Board during the period under review:

	First appointment date
Joseph Said	18 August 2006
David P. Attard	16 January 2015
James Dunbar Cousin	27 February 2018
Graham A. Fairclough	27 February 2018
Eugenio Farrugia	1 October 2016
Paul Muscat	15 November 2017
Aurelio Theuma	8 October 2007

Joseph Said is an Executive Director of the ultimate controlling shareholder, while David P. Attard, Graham A. Fairclough, Eugenio Farrygia and Aurelio Theuma are employees of the ultimate controlling shareholder. These relationships are not considered necessarily conducive to the creation of a conflict of interest such as to jeopardise exercise of these Directors' free judgement. James Dunbar Cousin and Paul Muscat are considered to be independent non-Executive Directors of the Company and in determining independence or otherwise, the Board has taken into consideration the relevant Code provisions. David P. Attard is an Executive Director of the Company.

It is considered that the experience, skills and competencies of the Board are sufficient to ensure the proper functioning of the Board.

In terms of Principle 3.4, all the Directors have confirmed in writing that they:

(a) maintain in all circumstances their independence of analysis, decision and action;
(b) do not seek or accept any unreasonable advantages that could be considered as compromising their independence;
(c) clearly express their opposition in the event that a decision of the Board may harm the Company.

Taking cognisance of the Company's size and business model, the Board considers that as a policy it endeavours to have a varied board, particularly in terms of diverse educational and professional backgrounds as well as extensive and specialised experience. The Board is confident that for this reason and in light of the fact that the Company is controlled by Lombard Bank Malta p.l.c., it benefits from a satisfactory diversity of views and expertise which allows for a good understanding of current affairs, the environment in which the Company operates and long-term risks and opportunities related to the Company's business.

The Board will consider formalising its diversity policy and remains committed to achieving further diversity among its members particularly in terms of number, age, gender, experience, educational and professional backgrounds.

PRINCIPLE 4: RESPONSIBILITIES OF THE BOARD

The Board of Directors is responsible for the formulation of the agreed strategy as well as the monitoring of its implementation by management, within the confines of all the applicable rules and regulations.

In so doing, the Board is responsible for:

(a) devising the appropriate strategies of the Company with a view to maximising value;
(b) approving Business Plans which are consonant with approved strategies and monitoring the execution of such plans on a regular basis;
(c) approving Risk Management Plans which are appropriate to the business and monitoring the application of mitigating factors;
(d) ensuring that internal control systems are in place and function appropriately. Although the relative systems are designed to mitigate all the risks in accordance with best practice, they cannot completely eliminate the possibility of material error or fraud;
(e) appointing the Company's Executive Officers, monitoring their performance, approving their compensation as well as ensuring that succession plans are in place;
(f) putting in place a policy to ensure that the Company communicates effectively with shareholders, other stakeholders and the public generally;
(g) putting in place procedures to ensure that the Company and its employees maintain the highest standards of corporate conduct and ethical standards;
(h) delegating specific responsibilities to committees, notably the Audit and Risk Committee, the Assets and Liabilities Committee and the Remuneration Committee.

PRINCIPLE 5: BOARD MEETINGS

Eight (8) Board meetings were held during the period under review and attendance by Board members was as follows:

	Attended
Joseph Said	8
David P. Attard	8
James Dunbar Cousin	8
Graham A. Fairclough	8
Eugenio Farrugia	8
Paul Muscat	8
Aurelio Theuma	8

Both strategic and operational matters are featured in the agenda of Board meetings and the appropriate supporting papers are circulated to each Board member well ahead of the meeting to ensure adequate time for preparation for deliberation at Board meetings. All Board members are given the opportunity of expressing their opinion on all agenda items. Minutes of all Board meetings are prepared immediately after each meeting and circulated amongst all Board members. All the Directors dedicate the necessary attention and time to their duties as Directors of the Company.

PRINCIPLE 6: INFORMATION AND PROFESSIONAL DEVELOPMENT

While the training of management and staff is an on-going process, the Directors are regularly updated with all the relevant information which is considered necessary for the proper discharge of their duties and responsibilities. Furthermore, all Company Directors have direct access to the Company Secretary who is at their disposal and who ensures that the appropriate information flows are maintained at all times. Additionally, and in terms of the Company's statute, the Directors are entitled to seek independent professional advice on any aspect of their duties at the Company's expense.

On first joining the Board, each Director is provided with a dossier containing information pertaining to Director's duties and responsibilities together with relevant legislations, including the Malta Financial Services Authority Capital Markets Rules. Additionally, Directors have access to Senior Executives to update and develop their skills as considered appropriate on an ongoing basis. Furthermore, the directors have access to the Company's external auditors who are invited to attend all the Audit and Risk Committee meetings and the Board of Directors meetings as necessary.

PRINCIPLE 7: EVALUATION OF BOARD'S PERFORMANCE

Vide under Non-Compliance within the Code Section.

PRINCIPLE 8: COMMITTEES

The following committees have been established by the Board of Directors, each having their own Terms of Reference with direct reporting lines to the Board.

AUDIT AND RISK COMMITTEE

The Capital Markets Rules of the Matta Financial Services Authority provide for the establishment of an Audit and Risk Committee, the main functions of which include the monitoring of the financial reporting process, the soundness of the Company's internal control systems as well as the scrutiny and approval of related party transactions in order to ensure that the 'arm's length' principle is observed at all times. The management of the relationship of the external auditors with the Company also falls within the scope of the Audit and Risk Committee's Terms of Reference.

The Audit and Risk Committee was made up of three (3) Non-Executive Directors, viz Paul Muscat (Chairman), James Dunbar Cousin together with Aurelio Theuma.

In terms of Capital Markets Rule 5.117 both Paul Muscat and Aurelio Theuma are competent in Accounting and/or Auditing on the basis that they are both Certified Public Accountants. Furthermore, in terms of Capital Markets Rule 5.118, James Dunbar Cousin and Paul Muscat, are considered by the Board to be independent given that they are from any business, family or other relationship with the Company or its management in a manner that may create a conflict of interest such as to impair their judgement. The Company Secretary acts as secretary to the Audit and Risk Committee.

During the period under review the Audit and Risk Committee met six (6) times. While the external auditors are invited to attend, the Chief Internal Audit Officer and/or Head Internal Audit attend these meetings in terms of Capital Markets Rule 5.131 and has a direct access to the Chairman of the Audit and Risk Committee at all times. It is within the discretion of the Audit and Risk Committee members to invite any other official of the Company to attend any Committee meeting as they deem fit.

ASSETS AND LIABILITIES COMMITTEE

Membership of this Committee is made up of a non-Executive Director, the Chief Executive Officer and the Chief Finance Officer and chaired by the Executive Director. Its main objective is to manage risks and maximise returns by efficient and judicious management of the Company's assets and liabilities. A senior official of the Finance Department acts as a secretary to the Committee.

REMUNERATION COMMITTEE

The report by the Remuneration Committee in terms of Code Provision 8.A.4 is presented on pages 23 and 24. The Chief Executive Officer attends the Remuneration Committee meetings when requested to do so and the Company Secretary acts as secretary to this Committee.

PRINCIPLES 9 AND 10: RELATION WITH SHAREHOLDERS AND WITH THE MARKET AND INSTITUTIONAL SHAREHOLDERS

The Company is cognisant of the importance of maintaining effective and on-going dialogue with its shareholders as well as the market generally. It does so by issuing company announcements and press releases from time to time on matters which are considered important and which may affect the Company.

The announcement of the half-yearly results, as well as the annual results together with the interim Directors' statements are uploaded on the Company's website and that of the Malta Stock Exchange as are all the other company announcements issued. Additionally, the Company's website (www.maltapost.com) contains relevant information about the Company.

The Company also communicates with its members through the Annual General Meeting which shareholders are requested to consider the Annual Financial Report and Accounts, the declaration of a dividend (if any), the election of Directors' remuneration, the appointment of external auditors and the Board's authorisation to set the auditors' fees. Extraordinary General Meetings are held as and when necessary in conformity with both the Company's statute as well as the Companies Act (Cap. 386).

All Directors attend the General Meetings and are available to answer questions if necessary.

PRINCIPLE 11: CONFLICTS OF INTEREST

While Directors are aware of their duty and responsibility to act in the best interests of the Company at all times, policies and procedures are in place to ensure that Directors effectively manage any conflicts of interest, whether actual or potential, in the best interest of the Company.

Specifically, the Company's Memorandum and Articles of Association regulate the behaviour of a Director in the event of a potential conflict of interest.

Furthermore, the Company's Code of Conduct for dealings in securities and which has been adopted and implemented in conformity with The Market Abuse Laws and Regulations, sets out the obligations of a Director when it comes to dealing in any of the Company's securities.

The Directors' interest in the Share Capital of the Company as at 30 September 2021 was as follows:

	Shares held
Eugenio Farrugia	522 Ordinary Shares
Aurelio Theuma	2,646 Ordinary Shares

Joseph Said, who is a Director of the Company, is also a director of the following companies, which as at 30 September 2021 had the following shareholding in the Company:

	Shares held
First Gemini p.l.c.	36,341 Ordinary Shares
Safaco Limited	44,745 Ordinary Shares

In addition, Joseph Said has a minority shareholding in Safaco Limited.

PRINCIPLE 12: CORPORATE SOCIAL RESPONSIBILITY

Fully conscious of the responsibility towards the society in which it operates, MaltaPost p.l.c. not only encourages healthy and balanced lifestyles for its employees, but also seeks to promote environment friendly initiatives particularly those which reduce the Company's overall carbon footprint. Significant investment has been made in this area and the intention is to continue with this investment.

The Company also encourages and promotes philanthropic initiatives towards disadvantaged groups and the intention is to continue in this direction.

MaltaPost p.l.c., therefore, is not only committed to be in full compliance with its legal obligations in this regard, but go well beyond this in pursuit of its social obligations.

NON-COMPLIANCE WITH THE CODE B.

PRINCIPLE 4: RESPONSIBILITIES OF THE BOARD

Code Provision 4.2.7 provides for the development of a succession policy for the future composition of the Board. Given that it is the prerogative of the shareholders of MaltaPost p.l.c. to elect directors to represent them and this in accordance with the Company's Memorandum and Articles of Association, and the Maltese Companies Act (Cap. 386) it has not been considered appropriate to develop a succession policy for the future composition of the Board. However, the recommendation to have a policy in place will be kept under review.

PRINCIPLE 7: EVALUATION OF BOARD'S PERFORMANCE

The Company Secretary arranges for a "Board Effectiveness Questionnaire" which is completed by each Board Member and the findings are analysed by him in liaison with the Chairman. Similarly, an "Effectiveness Questionnaire" is also arranged for the Audit and Risk Committee, by the Company Secretary in liaison with the Chairman.

PRINCIPLE 8: NOMINATION COMMITTEE

This Principle provides for a Nomittee to cater for a formal and transparent procedure for the appointment of new directors to the Board. Such a committee has not been set up given that it is the prerogative of the shareholders of the Company, in accordance with the relative Memorandum and Articles of Association, to appoint directors to the Board.

The Articles of Association of the Company provide that at every General Meeting, seven (7) directors are appointed as follows:

(a) a member of the Company holding, or a number of members, who between them hold, such number of shares having voting rights as may be sufficient to constitute one (1) or more Qualifying Holdings (such number of shares held by a member of the Company amounting to twenty per cent (20%) of the Issued Share Capital of the Company having rights) is entitled to appoint one (1) director for every Qualifying Holding held, by letter addressed to the Company Secretary;
(b) any member who is not entitled to appoint directors in terms of the provisions of paragraph (a) above, or who is not entitled to aggregate his holding with those of other members for the purposes of appointing a director(s) pursuant thereto, is entitled to participate and vote in an election of directors at the General Meeting of the Company;
(c) members who avail themselves of appointing directors pursuant to the provisions of paragraph (a) above are still entitled to participate in the election of directors in terms of paragraph (b) provided that in such an election they may only use such shares not otherwise used for the appointment of directors pursuant to paragraph (a).

For an election of directors mentioned in paragraph (b) above, every shareholder entitled to vote thereunder shall be entitled to nominate one (1) person to stand for the election of directors. Such nominee must be seconded by at least such shareholders as in aggregate hold at least point five per cent (0.5%) of the Issued Share Capital of the Company between them.

In the event that there are more nominations than there are vacancies, an election amongst such candidates shall take place for the appointment of such number of directors as will fill the vacancies available on the Board. At an election of directors each member shall be required to vote on the ballot paper provided by the Company by putting such number of votes against the name or names of the preferred candidates as such member may determine, provided that in aggregate the number of votes cast cannot exceed the number of shares held by such member. The candidates obtaining the highest number of votes shall be elected and appointed directors.

PRINCIPLE 9: RELATIONS WITH SHAREHOLDERS AND WITH THE MARKET

Code Provision 9.3 provides for procedures to be in place to resolve conflicts between minority shareholders and controlling shareholders. The Memorandum and Articles of Association of the Company do not provide for a procedure to resolve such conflicts. However, the Company's Senior Management and the Non-Executive Directors maintain an open dialogue to cater for any such conflicts.

The Company also maintains an open channel of communication with its shareholders through the Company Secretariat.

C. INTERNAL CONTROL (CAPITAL MARKETS RULE 5.97.4)

The Board of Directors have set up the required organisational structures in order to effectively manage and control the operational risks which the Company undertakes in its day-to- day operations. It is understood that whereas these risks may be mitigated by the adoption of various control systems, such risks cannot be completely eliminated. Therefore, reasonable but not absolute assurances can be given against material losses, error or fraud.
The more important structures which are in place to consolidate the internal control mechanisms are the Internal Audit Department, the Audit and Risk Committee as well as the Compliance and Risk Management functions.

The Company's system of internal control includes:

(a) the Company operates through an Executive Committee led by the Chief Executive Officer with clear reporting lines and delegation of authority. Through the Executive Committee the Company plans, executes, controls and monitors business operations in order to achieve the set objectives;
(b) the Company is committed to the highest standards of business conduct and seeks to maintain these standards across all its operations. Company policies and employee procedures are in place to detect, report and resolve any fraudulent activities or any infringement of the integrity of mail;
(c) the Executive Committee is responsible to identify and evaluate key risks applicable to areas of business. A member of this same Committee assists the Board of Directors to assess the different types of risks identified, to which the Company is exposed. This function also monitors, on an on-going basis, the effective management of the different types of risk at the same time as ensuring that the Company is in full compliance with all the obligations imposed by codes, rules, legislation and statute relevant to the Company as well as its business;
(d) the Board, through the Audit and Risk Committee, receives periodic management reports on Risk Management and Compliance; and
(e) the Board receives periodic management information giving comprehensive analysis of financial and business performance including variances against the Company's set targets.
D. GENERAL MEETINGS (CAPITAL MARKETS RULE 5.97.6)

A General Meeting is conducted in conformity with the Articles of Association of the Company and is called by giving at least 21 days notice.

The Ordinary Business conducted at the Annual General Meeting consists of receiving or adoption of the Annual Financial Statement, the Declaration of a Dividend, the Appointment and Remuneration of Directors, the Appointment of the External Auditors, as well as the Authority to the Board to fix the external Auditiors' emoluments.

All shareholders on the shareholders register on the record date as defined in the Capital Markets Rules, have the right to attend, participate and vote at the General Meeting.

A member or members holding not less than five per cent (5%) of the voting issued share capital of the Company may:

(a) request the Company to include items on the agenda of the General Meeting provided that each item is accompanied by a justification or a draft resolution to be adopted at the General Meeting; and
(b) table draft resolution for items included in the agenda of a General Meeting. Such requests are to be received by the Company at least forty-six (46) days before the date set for the relative General Meeting.

Every person entered into the register of members shall be entitled to appoint only one (1) person to act as proxy holder to attend and vote at a General Meeting instead of him. The proxy holder shall enjoy the same rights to speak and ask questions in the General Meeting as those to which the member thus represented would be entitled.

Approved by the Board of Directors on 20 December 2021 and signed on its behalf by:

Joseph Said Chairman

Aurelio Theuma Director

Remuneration report

MEMBERSHIP AND TERMS OF REFERENCE

The following Directors of MaltaPost p.l.c. make up the Remuneration Committee: Paul Muscat (Chaiman), Eugenio Farrugia, Aurelio Theuma and David P. Attard. The Remuneration Committee is tasked with maintaining a Remuneration Policy which ensures that MaltaPost p.l.c. attracts, retains and motivates the appropriate calibre of Directors, Senior Executives and Management in the formulation and execution of the Company's strategies and policies. Furthermore, the Remuneration Committee recommends to the Board of Directors remuneration packages for all Directors and Senior Management.

MEETINGS

During the financial year ended 30 September 2021 the Remuneration Committee met three (3) times and these were attended by all members to discuss the following matters:

Review of the Terms of Reference of the Committee and Remuneration Policy
Review of Guiding Principles relative to management salaries and discretionary bonuses
Proposed Salaries and Discretionary Bonuses

REMUNERATION - DIRECTORS

The last Annual General Meeting approved the amount of seventy five thousand euro (€75,000) as the aggregate amount by way of Directors' Remuneration. During the same meeting, the members approved the remuneration report for directors which was a separate agenda item of the Annual General Meeting.

None of the Directors has any service contracts with the Company, and none is entitled to share options, profit sharing, pension benefits or any other remuneration. It is confirmed that no other fees were payable to any of the Directors during the year under review.

Five (5) of the Directors are employees of the ultimate controlling shareholder of MaltaPost p.l.c.

In terms of Code Provision 8.A.5 of the Malta Financial Services Authority Capital Markets Rules, the total emoluments received by Directors for the financial year are specified below:

	FIXED REMUNERATION	VARIABLE REMUNERATION SHARE OPTIONS		OTHERS
2021	€59,600	None	None	None
2020	€59,600	None	None	None
	Directors' emoluments paid for financial year were as follows:
		2021	2020
Joseph Said David P. Attard James Dunbar Cousin Graham A. Fairclough Eugenio Farrugia		€17,000	€17,000 € 7,100 € 7,100 € 7.100 € 7,100
		€ 7,100
		€ 7,100
		€ 7,100
		€ 7,100
Paul Muscat		€ 7,100	€ 7,100
Aurelio Theuma		€ 7,100	€ 7,100
Total		€59,600	€59,600

Remuneration report - continued

In terms of Code Provision 8.A.5 of the Malta Financial Services Authority Capital Markets Rules, during financial year 2020/2021, the Executive Director was paid by the parent company, who in turn recharged MaltaPost €103,162 (2020: €98,664) for his role. The total emoluments received by the Chief Executive Officer for this financial year amounted to €106,461 (2020: €102,501).

REMUNERATION - SENIOR EXECUTIVES

All references to 'Senior Executives' in this report refer specifically to the Chief Officers of MaltaPost p.l.c.

It falls within the Terms of Reference of the Remuneration Committee to recommend to the Board of Directors the appropriate remuneration packages for Senior Executives. In so doing the Committee is mindful of the need to attract, retain and motivate Senior Executives with the qualities which enable them to discharge their obligations professionally and with utmost integrity. The Remuneration Committee also seeks to maintain a sense of fairness and consistency in its recommendations. In this connection it is to be mentioned that there were no material changes to the remuneration policy for Senior Executives during the financial year ended 30 September 2021.

The contracts of all Senior Officers specify their remuneration packages, none of which provide for profit sharing or share options, supplementary pension benefits. All Senior Executives are on indefinite contracts of employment.

Annual salary increases may be awarded to Chief Officers but such increases are not directly related to performance. A discretionary annual bonus, however, is payable to the Chief Officers following an assessment of their performance during the previous financial year.

The Board of Directors and Chief Executive Officer agree upon pre-set quantitative and qualitative objectives for the Chief Executive Officer and a discretionary annual bonus is payable to him based on the attainment of these objectives. The Remuneration Committee considers the linkage between the fixed remuneration and the discretionary annual bonus to be appropriate.

In terms of Code Provision 8.A.5 of the Malta Financial Services Authority Capital Markets Rules, the total emoluments received by Senior Executives during the financial year are as detailed below:

		FIXED REMUNERATION VARIABLE REMUNERATION SHARE OPTIONS OTHERS
2021	€22.000	€18.000	None	See below*
2020	€234.400	€20,000	None	See below*

The foregoing Remuneration Report is being put forward to an advisory vote of the 2021 Annual General Meeting in accordance with the requirements of the Malta Financial Services Authority Capital Markets Rule 12.26 L.

Joseph Said Chairman

Aurelio Theuma Director

*Senior Executives are covered by a group iffe assurance scheme and are entitled to health insurance, communication expenses as well as the use of company car or car allowance.

Independent auditor's report

To the Shareholders of MaltaPost p.l.c.

Report on the audit of the financial statements

Our opinion

In our opinion:

· The Group financial statements and Parent Company financial statements (the "financial statements") give a true and fair view of the Group's and the Parent Company's financial position of MaltaPost p.l.c. as at 30 September 2021, and of the Group's and the Parent Company's financial performance and cash flows for the year then ended in accordance with International Financial Reporting Standards ('IFRSs') as adopted by the EU; and
· The financial statements have been prepared in accordance with the requirements of the Maltese Companies Act (Cap. 386).

Our opinion is consistent with our additional report to the Audit Committee.

What we have audited

MaltaPost p.l.c.'s financial statements, set out on pages 38 to 94, comprise:

· the Consolidated and Parent Company statements of financial position as at 30 September 2021;
· the Consolidated and Parent Company income statements of comprehensive income for the year then ended;
· the Consolidated and Parent Company statements of changes in equity for the year then ended;
· the Consolidated and Parent Company statements of cash flows for the year then ended; and
· the notes to the financial statements, which include significant accounting policies and other explanatory information.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Financial Statements section of our report.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Independence

We are independent of the Group and the Parent Company in accordance with the International Code of Ethics for Professional Accountants (including International Independence Standards) issued by the International Ethics Standards Board for Accountants (IESBA Code) together with the ethical requirements of the Accountancy Profession (Code of Ethics for Warrant Holders) Directive issued in terms of the Accountancy Profession Act (Cap. 281) that are relevant to our audit of the financial statements in Malta. We have fulfilled our other ethical responsibilities in accordance with these Codes.

To the Shareholders of MaltaPost p.l.c.

To the best of our knowledge and belief, we declare that non-audit services that we have provided to the Parent Company and its subsidiaries are in accordance with the applicable law and regulations in Malta and that we have not provided non-audit services that are prohibited under Article 18A of the Accountancy Profession Act (Cap. 281). The non-audit services that we have provided to the Parent Company and its subsidiaries, in the period from 1 October 2020 to 30 September 2021, are disclosed in Note 21 to the financial statements.

Our audit approach

Overview

As part of designing our audit, we determined materiality and assessed the risks of material misstatement in the consolidated financial statements. In particular, we considered where the Directors made subjective judgements; for example, in respect of significant accounting estimates that involved making assumptions and considering future events that are inherently uncertain. As in all of our audits, we also addressed the risk of management override of internal controls, including among other matters consideration of whether there was evidence of bias that represented a risk of material misstatement due to fraud.

Materiality

The scope of our audit was influenced by our application of materiality. An audit is designed to obtain reasonable assurance whether the financial statements are from material misstatements may arise due to fraud or error. They are considered material if individually or in aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the consolidated financial statements.

Based on our professional judgement, we determined certain quantitative thresholds for materiality, including the overall group materiality for the consolidated financial statements as a whole as set out in the table below. These, together with qualitative considerations, helped us to determine the scope of our audit and the nature, timing and extent of our audit procedures and to evaluate the effect of misstatements, both individually and in aggregate on the financial statements as a whole.

To the Shareholders of MaltaPost p.l.c.

Overall group materiality	€130,000
How we determined it	Approximately 5% of profit before tax
Rationale for the materiality benchmark applied	We chose profit before tax as the benchmark because, in our view, it is the benchmark against which the performance of the Group is most commonly measured by users, and is a generally accepted benchmark. We chose 5% which is within the range of quantitative materiality thresholds that we consider acceptable.

We agreed with the Audit Committee that we would report to them misstatements identified during our audit above €13,000 as well as misstatements below that amount that, in our view, warranted reporting for qualitative reasons.

Key audit matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial statements of 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

Risk of fraud in revenue recognition

ISA 240 presumes that there is a risk of material misstatement due to fraud related to revenue recognition and requires the auditor to treat this assessed risk of material misstatement due to fraud as a significant risk, thus requiring special audit consideration.

This comprises the risk that sales revenue is misstated due to fraud as individuals may have incentive to manipulate revenue, and hence results. The risk of fraud in revenue recognition entails the risk that sales revenue is not recognised in accordance with IFRS 15 requirements, and that revenue is not completely or accurately reflected or that fictitious sales revenue is recorded or that the cut-off point at which risks and rewards are transferred is not correctly reflected in the financial statements.

How our audit addressed the key audit matter

We confirmed our understanding and evaluation of the Parent Company's control processes and procedures in respect of revenue recognition, including IT and system controls.

Specifically, in respect of revenue from retail sales, we evaluated the relevant systems and the design of controls, and tested the operating effectiveness of automated and non-automated controls over the:

· capture and recording of revenue transactions comprising products or services supplied to customers;
· authorisation of price changes and updating this information within the operational retail system; and
· calculation of amounts invoiced to customers.

To the Shareholders of MaltaPost p.l.c.

Key audit matter

The Parent Company's revenue consists of revenue from retail sales, comprising sale of stamps, philatelic sales, sale of non-postal stationery and provision of non-postal services, and sales from terminal dues, consisting of remuneration for processing and delivering postal items received from other territories.

Terminal dues are invoiced on a quarterly basis in arrears on the basis of volume data accumulated throughout the respective quarter. Accordingly, the risk of fraud in revenue recognition in respect of terminal dues is principally attributable to the unbilled revenue at year end in respect of the last quarter of the financial year.

Revenue from retail sales is attributable to a large volume of low value transactions handled through an operational retail system in an automated manner, whereby inventory items are updated with sales taking into account standing data in respect of unit prices. In this respect, the risk of fraud in revenue recognition is mainly in respect of the output of the operational retail system not being properly reflected within the accounting system.

How our audit addressed the key audit matter

Accordingly, we validated key controls including automated control procedures in respect of the operational retail system. We tailored our final audit plan based on the results of our assessment of the control environment and operating effectiveness of such controls. We utilised computer assisted audit techniques to recalculate aggregate revenue recognised by extracting independently volume data from the operational retail system and taking into account independently sourced or verified sales prices to address accuracy and existence. We also tested reconciliations between the operational retail and accounting systems to address completeness and cut-off. We have also carried out audit procedures, comprising validation of controls and tests of detail, in respect of cash counts and stock counts covering the retail sales business.

In respect of terminal dues, we have carried out tests of detail by recalculating revenue recognised during the year on the basis of volume data accumulated over time. We have validated volume data to third party documentation or documentation duly approved by third parties. We have also validated volume data by carrying out tests such as sequence checks and other data validation tests. We have validated terminal dues rates to contractual arrangements or other supporting documentation.

We have also tested revenue recognised in respect of terminal dues within the accounting system to amounts invoiced and the subsequent receipt of payment.

In respect of this key audit matter, we found no significant exceptions in our controls testing and no material misstatements were identified in our substantive testing.

Refer to Accounting policy 1.18 and Note 20 of the financial statements

To the Shareholders of MaltaPost p.l.c.

How we tailored our Group audit scope

We tailored the scope of our audit in order to perform sufficient work to enable us to provide an opinion on the financial statements as a whole, taking into account the Group, the accounting processes and controls, and the industry in which the Group operates.

The Group's accounting process is structured around a group finance function at its head office. Within the head office, supporting finance functions exist for each of the key business operating areas, and these report to the Group finance team as appropriate. All work was conducted by the same audit team in Malta.

The Group audit team performed all of this work by applying the overall Group materiality, together with additional procedures performed on the consolidation. This gave us sufficient appropriate audit evidence for our opinion on the Group financial statements as a whole.

Other information

The Directors are responsible for the other information comprises the Chairman's statement to the members, the Chief Executive Officer's review of operations, the Directors' report, the Statement of compliance with the principles of good corporate governance, the Company information, the Five year summary, the Financial highlights in major currencies and the Supplementary information (but does not include the financial statements and our auditor's report thereon).

Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon except as explicitly stated within the Report on other legal and regulatory requirements.

In connection with our audit of the financial statements, our responsibility is to read the other information identified above and, in doing so, consider whether the other information is materially inconsistent with the 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. We have nothing to report in this regard.

To the Shareholders of MaltaPost p.l.c.

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

The Directors are responsible for the preparation of financial statements that give a true and fair view in accordance with IFRSs as adopted by the EU and the requirements of the Maltese Companies Act (Cap. 386), and for such internal control as the Directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the Directors are responsible for assessing the Group's and the Parent Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Directors either intend to liquidate the Group or the Parent Company or to cease operations, or have no realistic alternative but to do so.

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

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the 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 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 financial statements.

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

· 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 and the Parent Company's internal control.
· Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Directors.
· Conclude on the appropriateness of the Directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group's or the Parent Company'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, because not all future events or conditions can be predicted, this statement is not a guarantee as to the Group's or the Parent Company's ability to continue as a going concern. In particular, it is difficult to evaluate all of the potential implications that COVID-19 will have on the Group's and the Parent Company's trade, customers and suppliers, and the disruption to its business and the overall economy.

To the Shareholders of MaltaPost p.l.c.

· Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
· Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the Group audit. We remain solely responsible for our audit opinion.

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

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, actions taken to eliminate threats or safeguards applied.

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

Report on other legal and regulatory requirements

The Annual Financial Report and Financial Statements 2021 contains other areas required by legislation or regulation on which we are required to report. The Directors are responsible for these other areas.

The table below sets out these areas presented within the Annual Financial Report, our related responsibilities and reporting, in addition to our responsibilities and reporting reflected in the Other information section of our report. Except as outlined in the table, we have not provided an audit opinion or any form of assurance.

To the Shareholders of MaltaPost p.l.c.

Area of the Annual Financial Report and Financial Statements 2021 and the related Directors responsibilities

Directors' report

(on pages 6 to 13) The Maltese Companies Act (Cap. 386) requires the directors to prepare a Directors' report, which includes the contents required by Article 177 of the Act and the Sixth Schedule to the Act.

We are required to consider whether the information given in the Directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements.

Our responsibilities

We are also required to express an opinion as to whether the Directors' report has been prepared in accordance with the applicable legal requirements.

In addition, we are required to state whether, in the light of the knowledge and understanding of the Company and its environment obtained in the course of our audit, we have identified any material misstatements in the Directors' report, and if so to give an indication of the nature of any such misstatements.

With respect to the information required by paragraphs 8 and 11 of the Sixth Schedule to the Act, our responsibility is limited to ensuring that such information has been provided.

In our opinion:

Our reporting

the information given in the . . Directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
· the Directors' report has been prepared in accordance with the Maltese Companies Act (Cap. 386).

We have nothing to report to you in respect of the other responsibilities, as explicitly stated within the Other information section.

To the Shareholders of MaltaPost p.l.c.

Area	the	Annual
Financial	Report and
Financial		Statements
2021 and the related
Directors' responsibilities

Statement of Compliance with the Principles of Good Corporate Governance

(on pages 14 to 22)

The Capital Markets Rules issued by the Malta Financial Services Authority require the directors to prepare and include in the Annual Financial Report a Statement of Compliance with the Code of Principles of Good Corporate Governance within Appendix 5.1 to Chapter 5 of the Capital Markets Rules. The Statement's required minimum contents are determined by reference to Capital Markets Rule 5.97. The Statement provides explanations as to how the Company has complied with the provisions of the Code, presenting the extent to which the Company has adopted the Code and the effective measures that the Board has taken to ensure compliance throughout the accounting period with those Principles.

Remuneration report

(on pages 23 to 24)

The Capital Markets Rules issued by the Malta Financial Services Authority require the directors to prepare a Remuneration report, including the contents listed in Appendix 12.1 to Chapter 12 of the Capital Markets Rules.

Our responsibilities

Our reporting

We are required to report on the Statement of Compliance by expressing an opinion as to whether, in light of the knowledge and understanding of the Company and its environment obtained in the course of the audit, we have identified any material misstatements with respect to the information referred to in Capital Markets Rules 5.97.4 and 5.97.5, giving an indication of the nature of any such misstatements.

We are also required to assess whether the Statement of Compliance includes all the other information required to be presented as per Capital Markets Rule 5.97.

We are not required to, and we do not, consider whether the Board's statements on internal control included in the Statement of Compliance cover all risks and controls, or form an opinion on the effectiveness of the Company's corporate governance procedures or its risk and control procedures.

We are required to consider whether the information that should be provided within the Remuneration report, as required in terms of Appendix 12.1 to Chapter 12 of the Capital Markets Rules, has been included.

In our opinion, the Statement of Compliance has been properly prepared in accordance with the requirements of the Capital Markets Rules issued by the Malta Financial Services Authority.

We have nothing to report to you in respect of the other responsibilities, as explicitly stated within the Other information section.

In our opinion, the Remuneration report has been properly prepared in accordance with the requirements of the Capital Markets Rules issued by the Malta Financial Services Authority.

To the Shareholders of MaltaPost p.l.c.

of Area the Annual Report and Financial Financial Statements 2021 and the related Directors' responsibilities	Our responsibilities	Our reporting
	Other matters on which we are required to report by exception We also have responsibilities under the Maltese Companies Act (Cap. 386) to report to you if, in our opinion:	We have nothing to report to you in respect of these responsibilities.
	adequate accounting records 0 have not been kept, or returns adequate for our audit have not been received from branches not visited by us. the financial statements are not in agreement with the accounting records and returns.
	we have not received all the information and explanations which, to the best of our knowledge and belief, we require for our audit.
	We also have responsibilities under the Capital Markets Rules to review the statement made by the directors that the business is a going concern together with supporting assumptions or qualifications as necessary.

To the Shareholders of MaltaPost p.l.c.

Other matter - use of this report

Our report, including the opinions, has been prepared for and only for the Parent Company's shareholders as a body in accordance with Article 179 of the Maltese Companies Act (Cap. 386) and for no other purpose. We do not, in giving these opinions, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior written consent.

Appointment

We were first appointed as auditors of the Group on 1 May 1998. Our appointment has been renewed annually by shareholder resolution representing a total period of uninterrupted engagement appointment of 23 years. The Parent Company became listed on a regulated market on 24 January 2008.

PricewaterhouseCoopers 78, Mill Street Zone 5, Central Business District Qormi Malta

Partner

20 December 2021

Statements of financial position

		Group		Company
	Notes			As at 30 September
		20221 € 000	2020 € 000	2029 € 000	2020 € 000
ASSETS
Non-current assets
Property, plant and equipment	4	22,289	18,749	22,174	18.749
Right-of-use assets	5	1,534	1,805	1,534	1,805
Intangible assets	6	1,167	948	1,044	948
Investment in subsidiaries	7			416	म
Investment in associate	8	1,507	248	1,875	399
Financial assets at fair value through other
comprehensive income	9	2,900	3,561	2,900	3,561
Deferred tax asset	10	495	448	393	448
Total non-current assets		29,892	25,759	30,336	25,911
Current assets
Inventories	11	700	719	700	719
Trade and other receivables	12	9,981	8,410	9,754	8,410
Current tax asset		10
Deposits with financial institutions	13	6,200	5,600	6,200	5,600
Cash and cash equivalents	14	4,943	6,058	4,206	6.072
Business of insurance accounts	14	448
Total current assets		22,280	20,787	20,860	20,801
Total assets		52,172	46,546	51.196	46.712

Statements of financial position - continued

		Group		Company
				As at 30 September
	Notes	2072 €'000	2020 € 000	20729 €'000	2020 € 000
EQUITY AND LIABILITIES
Capital and reserves
Share capital	15	9,414	9,414	9,414	9,414
Share premium	15	7,367	7,367	7,367	7,367
Other reserves	16	3,808	2,586	3,898	2,586
Retained earnings		7,695	7,802	8,050	7,924
Total equity attributable to equity
holders of the Company		28,374	27,169	28,729	27,291
Non-controlling interest		387
Total equity		28,761	27,169	28,729	27,291
Non-current liabilities
Deferred tax liability	10	1,299	1,028	1,299
Lease liabilities	17	1,290	1,549		1,028
Provision for liabilities and charges	18	1,539	1,586	1,290 1,539	1,549 1,586
Total non-current liabilities		4,128	4,163	4,128	4,163

Current liabilities
Lease liabilities	17	2792	265	272	265
Provision for liabilities and charges	18	139	142	139	142
Trade and other payables	19	18,063	13,963	17,119	14,015
Current tax liability		309	844	309	836
Total current liabilities		19,283	15,214	18,3339	15,258
Total liabilities		23,411	19,377	22,467	19,421
Total equity and liabilities		52,172	46,546	51,196	46,712

The notes on pages 47 to 94 are an integral part of these financial statements.

The financial statements on pages 38 to 94 were authorised for issue by the Board on 20 December 2021 and were signed on its behalf by:

Joseph Said Chairman

Aurelio Theuma Director

Income statements

		Group		Company
		Year ended 30 September
	Notes	2021 € 000	2020 €'000	2024 € 000	2020 € 000
Revenue Employee benefits expense Depreciation and amortisation expense Other expenses Other income	20 22 21 21 23	37,926 (16,165) (1,802) (17,851) 374	34,087 (15,171) (1,496) (15,056) 480	37,528 (16,012) (1,783) (17,610) 374	34.087 (15,171) (1,496) (15,075) 480
Operating profit Share of results of associate Finance costs Finance income	8 17 24	2,482 (217) (54) 139	2,844 (151) (62) 149	2,497 (54) 139	2,825 (62) 149
Profit before tax Tax expense	25	2,350 (951)	2,780 (1,017)	2,582 (950)	2,912 (1,010)
Profit for the year		1,309	1,763	1,632	1,902
Attributable to: Owners of the Company Non-controlling interest		1,399	1,763	1,632	1,902
		1,399	1,763	1,632	1,902
Earnings per share	27	60.04	€0.05

The notes on pages 47 to 94 are an integral part of these financial statements.

Statements of comprehensive income

			Group	Company
		Year ended 30 September
	Notes	2022 € 000	2020 € 000	2022 € 000	2020 C'000
Comprehensive income Profit for the year		1,399	1,763	1,632	1,902

Other comprehensive income Items that may be subsequently reclassified to profit or loss Losses from changes in fair value: Financial assets at fair value through
other comprehensive income	9	(28)	(131)	(58)	(131)
Items that will not be reclassified to profit or loss
Surplus arising on revaluation of land and buildings Remeasurements of defined benefit	4	1,641		1,641
obligations	18		133		133
Income tax relating to components of other comprehensive income: Surplus arising on revaluation of
land and buildings Remeasurements of defined benefit	10	(271)		(271)
obligations	10		(46)		(46)
Total other comprehensive income for the year		1,312	(44)	1,312	(44)
Total comprehensive income for the Year		2,711	1,719	2,944	1,858

The notes on pages 47 to 94 are an integral part of these financial statements.

Statements of changes in equity

Group			Attributable to owners of the Company
	Notes	Share capital € 000	Share premium € 000	other reserves @000	Retained earnings € 000	Total € 000
Balance at 1 October 2019		9,414	7,367	2,630	7,545	26,956
Comprehensive income Profit for the year					1,763	1,763
Other comprehensive income Financial assets at fair value through other comprehensive income:
Losses from changes in fair value	9			(131)		(131)
Remeasurements of defined benefit Obligations Deferred tax thereon	18 10			133 (46)		133 (46)
Total other comprehensive income				(44)		(44)
Total comprehensive income				(44)	1,763	1,719
Transactions with owners in their capacity as owners Distributions to owners:
Dividends paid to equity holders	28				(1,506)	(1,506)
Total transactions with owners in their capacity of owners					(1,506)	(1,506)
Balance at 30 September 2020		9,414	7,367	2,586	7,802	27,169

Statements of changes in equity - continued

Group			Attributable to owners of the Company
	Notes	Share capital € 000	Share premium € 0000	other reserves € 000	Retained earnings € 000	Total €'000	Non controlling interest € 000	Trotal equity € 000
Balance at 1 October 2020		9,414	7,367	2,586	7,802	27,169		27,169
Comprehensive income Profit for the year					1,399	1,399		1,399
Other comprehensive income Surplus arising on revaluation of land and buildings, net of deferred tax	4, 10			1,370		1,370		1,370
Financial assets at fair value through other comprehensive income: Losses from changes in fair value	9			(58)		(58)		(28)
Total other comprehensive income				1,312		1,312		1,312
Total comprehensive income				1,312	1,399	2,711		2,711
Transactions with owners in their capacity as owners Distributions to owners: Dividends paid to equity holders	28					(1,506) (1,506)		(1,506)
Changes in ownership interest: Non-controlling interest arising on acquisition of subsidiary							387	387
Total transactions with owners in their capacity of owners						(1,506) (1,506)	387	(1,119)
Balance at 30 September 2021		9,414	7,367	3,808		7,695 28,374	387	28.761

Statements of changes in equity - continued

Company

	Notes	Share capital € 000	Share premium € 000	other reserves € 000	Retained earnings € 000	Total € 000
Balance at 1 October 2019		9,414	7,367	2,630	7,528	26,939
Comprehensive income Profit for the year					1,902	1,902
Other comprehensive income Financial assets at fair value through other comprehensive income: Gains from changes in fair value	9			(131)		(131)
Remeasurements of defined benefit
obligations	18			133		133
Deferred tax thereon	10			(46)		(46)
Total other comprehensive income				(44)		(44)
Total comprehensive income				(44)	1,902	1,858
Transactions with owners in their capacity of owners Distributions to owners:
Dividends paid to equity holders	28				(1,506)	(1,506)
Total transactions with owners in their capacity of owners					(1,506)	(1,506)
Balance at 30 September 2020		9,414	7,367	2,586	7,924	27,291

Statements of changes in equity - continued

Company

	Notes	Share capital € 0000	Share premium € 0000	other reserves € 000	Retained earnings @000	Total C 000
Balance at 1 October 2020		9,414	7,367	2,586	7,924	27,291
Comprehensive income Profit for the year					1,632	1,632
Other comprehensive income Surplus arising on revaluation of land and buildings, net of deferred tax	4, 10			1,370		1,370
Financial assets at fair value through other comprehensive income: Losses from changes in fair value	9			(58)		(58)
Total other comprehensive income				1,312		1,312
Total comprehensive income				1,312	1,632	2,944
Transactions with owners in their capacity as owners Distributions to owners: Dividends paid to equity holders	28				(1,506)	(1,506)
Total transactions with owners in their capacity as owners					(1,506)	(1,506)
Balance at 30 September 2021		9,414	7,367	3,808	8,050	28,729

The notes on pages 47 to 94 are an integral part of these financial statements.

Statements of cash flows

		Group		Company
		Year ended 30 September
	Note	2022 € 000	2020 €,000	20729 € 000	2020 € 000
Cash flows from operating activities Cash from customers Cash paid to suppliers and employees Cash flows attributable to funds collected		36,196 (30,392)	37,486 (30,722)	36,020 (30,426)	37,486 (30,692)
on behalf of third parties		6:2	(777)	632	(777)
Cash generated from operating activities Net income tax (paid)/ refunded		6,486 (984)	5,987 ea	6,276 (924)	6,017 72
Net cash generated from operating activities		5,552	6,056	5,352	6,089
Cash flows from investing activities Interest charges on lease liabilities Interest received		(54) 149	(62) 169	(54) 149	(62) 169
Purchase of property, plant and equipment Purchase of intangible assets Purchase of investment in subsidiaries Purchase of investment in associate		(3,023) (850) (1,500)	(1,638) (694) (399)	(2,914) (710) (415) (1,500)	(1,638) (694) (399)
Proceeds from disposals/redemptions of financial assets at fair value through other comprehensive income Maturity of deposits with financial institutions		(2019) 4,900	231	(30)a 4,900	231
Placement of deposits with financial institutions		(5,500)	(900)	(5,500)	(900)
Net cash used in investing activities		(5,269)	(3,293)	(5,435)	(3,293)
Cash flows from financing activities Principal element of lease payments Dividends paid		(279) (1,504)	(266) (1,504)	(279) (1,504)	(266) (1,504)
Net cash used in financing activities		(1,783)	(1,770)	(1,783)	(1,770)
Net movement in cash and cash equivalents		(1,500)	વેવારા	(1,866)	1,026
Cash and cash equivalents at beginning of year		6,058	5,065	6,072	5,046
Net cash acquired on acquisition		333
Cash and cash equivalents at end of year	14	5,391	6,058	4,206	6,072

The notes on pages 47 to 94 are an integral part of these financial statements.

a parti de la comer

Notes to the financial statements

1. Summary of significant accounting policies

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

1.1 Basis of preparation

The consolidated financial statements include the financial statements of MaltaPost p.l.c. (the Company) and its subsidiary undertakings (together referred to as 'the Group' and individually as 'Group entities'). The financial statements are prepared in accordance with International Financial Reporting Standards (IFRSs) as adopted by the EU and comply with the requirements of the Maltese Companies Act (Cap. 386). The financial statements are prepared under the historical cost convention, as modified by the fair valuation of the land and buildings class within property, plant and equipment and financial assets at fair value through other comprehensive income.

The preparation of financial statements in conformity with IFRSs as adopted by the EU requires the use of certain critical accounting estimates. It also requires Directors to exercise their judgement in the process of applying the Group's accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements are disclosed in Note 3.

(a) Standards, interpretations and amendments to published standards effective in 2021

In 2021, the Group adopted new amendments and interpretations to existing standards that are mandatory for the Group's accounting period beginning on 1 October 2020. The adoption of these revisions to the requirements of IFRSs as adopted by the EU did not result in changes to the Group's accounting policies impacting the financial performance and position.

(b) Standards, interpretations and amendments to published standards that are not yet effective

Certain new standards, amendments and interpretations to existing standards have been published by the date of authorisation for issue of these financial statements, that are mandatory for the Group's accounting periods beginning after 1 October 2020. The Group has not early adopted these revisions to the requirements of IFRSs as adopted by the EU, and the Company's Directors are of the opinion that there are no requirements that will have a possible significant impact on the Group's financial statements in the period of initial application.

1.2 Consolidation

(a) Subsidiaries

Subsidiaries are all entities (including structured entities) over which the Group has control. The Group controls an entity when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the Group controls another entity. The Group also assesses existence of control where it does not have more than 50% of the voting power but is able to govern the financial and operating policies by virtue of de-facto control may arise in circumstances where, for instance the size of the Group's voting rights relative to the size and dispersion of holdings of other shareholders give the Group the power to govern the financial and operating policies. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are de-consolidated from the date that control ceases. The Group applies the acquisition method of accounting to account for business combinations that fall within the scope of IFRS 3, Business Combinations. The consideration transferred for the acquisition of a subsidiary is the fair values of the assets transferred, the liabilities incurred to the former owners of the acquiree and the equity interests issued by the Group. The consideration transferred includes the fair value of any asset or liability resulting from a contingent consideration arrangement. Acquisition-related costs are expensed as incurred. Identifiable assets acquired and liabilities and contingent liabilities assumed (identifiable net assets) in a business combination are measured initially at their fair values at the acquisition date. On an acquisition-by-acquisition basis, the Group recognises any noncontrolling interest in the acquiree either at fair value or at the non-controlling interest's proportionate share of the recognised amounts of the acquiree's identifiable net assets.

Goodwill is initially measured as the excess of the consideration transferred, the amount of any noncontrolling interest in the acquiree and the acquisition-date fair value of any previous equity interest in the acquiree over the fair value of the identifiable net assets acquired. If this is less than the fair value of the identifiable net assets of the subsidiary acquired in the case of a bargain purchase, the difference is recognised directly in profit or loss.

Upon consolidation, inter-company transactions, balances and unrealised gains on transactions between Group companies are eliminated. Unrealised losses are also eliminated but considered an impairment indicator of the asset transferred. Accounting policies of subsidiaries are changed where necessary to ensure consistency with the policies adopted by the Group.

In the Company's separate financial statements, investments in subsidiaries are accounted for by the cost method of accounting, i.e. at cost less impairment. Cost is adjusted to reflect changes in consideration arising from contingent consideration amendments. Cost also includes directly attributable costs of acquiring the investment. Provisions are recorded where, in the opinion of the Directors, there is an impairment in value. Where there has been an impairment in the value of an investment, it is recognised as an expense in the period in which the diminution is identified. The results of subsidiaries are reflected in the Company's separate financial statements only to the extent of dividends receivable. On disposal of an investment, the difference between the net disposal proceeds and the carrying amount is charged or credited to profit or loss.

(b) Disposal of subsidiaries

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

1.2 Consolidation - continued

(c) Associates

Associates are all entities over which the Group has significant influence but not control, generally accompanying a shareholding of between 20% and 50% of the voting rights. Investments in associates are accounted for using the equity method of accounting in the consolidated financial statements. Under the equity method, the investment is initially recognised at cost, and the carrying amount is increased or decreased to recognise the investor's share of the profit or loss of the investee after the date of acquisition. The Group's investment in associates includes goodwill identified on acquisition.

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

The Group's share of post-acquisition profit or loss is recognised in the income statement, and its share of post-acquisition movements in other comprehensive income is recognised in other comprehensive income with a corresponding adjustment to the carrying amount of the investment.

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

The Group determines at each reporting date whether there is any objective evidence that the investment in the associate is impaired. If this is the Group calculates the amount of impairment as the difference between the recoverable amount of the associate and its carrying value and recognises the amount adjacent to 'share of profit((loss) of associates' in the income statement.

Profits and losses resulting from upstream and downstream transactions between the Group and its associate are recognised in the Group's financial statements only to the extent of unrelated investor's interests in the associates. Unrealised losses are eliminated unless the transaction provides evidence of an impairment of the asset transferred. Accounting policies of associates have been changed where necessary to ensure consistency with the policies adopted by the Group.

Dilution gains and losses arising in investments in associates are recognised in the income statement.

In the Company's separate financial statements, investments in associates are accounted for by the cost method of accounting, i.e. at cost less impairment. Provisions are recorded where, in the opinion of the Directors, there is impairment in value. Where there has been impairment in the value of an investment, it is recognised as an expense in the period in which the diminution is identified. The results of the associate are reflected in the Company's separate financial statements only to the extent of dividends receivable. On disposal of an investment, the difference between the net disposal proceeds and the carrying amount is charged or credited to profit or loss.

1.3 Foreign currency translation

(a) Functional and presentation currency

Items included in these financial statements are measured using the currency of the primary economic environment in which the entity operates (the functional currency'). The financial statements are presented in euro, which is the Company's functional and presentation currency.

(b) Transactions and balances

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss.

1.4 Property, plant and equipment

All property, plant and equipment is initially recorded at historical cost.

Land and buildings are subsequently shown at fair value based on periodic, but at least triennial, valuations by external independent valuers, less subsequent depreciation for buildings. Valuations are carried out on a regular basis such that the carrying amount of property does not differ materially from that which would be determined using fair values at the end of the reporting period. Any accumulated depreciation at the date of revaluation is eliminated against the gross carrying amount of the asset, and the net amount is restated to the revalued amount of the asset.

All other property, plant and equipment is subsequently stated at historical cost less accumulated depreciation and accumulated impairment losses. Historical cost includes expenditure that is directly attributable to the acquisition of the items. The cost of self-constructed assets includes the cost of materials and direct labour, any other costs directly attributable to bringing the assets to a working condition for their intended use, the costs of dismantling and removing the items and restoring the site on which they are located, and capitalised borrowing costs. Purchased software that is integral to the functionality of the related equipment is capitalised as part of that equipment.

Borrowing costs which are incurred for the purpose of acquiring a qualifying asset are capitalised as part of its cost. Borrowing costs are capitalised while acquisition or construction is actively underway. Capitalisation of borrowing costs is ceased once the asset is substantially complete, and is suspended if the development of the asset is suspended. Subsequent costs are included in the asset's carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably.

The carrying amount of the replaced part is derecognised. All other repairs and maintenance are charged to profit or loss during the financial period in which they are incurred.

Increases in the carrying amount arising on revaluation of land and buildings are credited to other comprehensive income and shown as a revaluation reserve in shareholders' equity. Decreases that offset previous increases of the same individual asset are charged in other comprehensive income and debited against the revaluation reserve directly in equity; all other decreases are charged to profit or loss. Any subsequent increases are recognised in profit or loss up to the amount previously charged to profit or loss, and then reflected in other comprehensive income and shown as a revaluation reserve.

1.4 Property, plant and equipment - continued

Land is not depreciated as it is deemed to have an indefinite life. Depreciation on other assets is calculated using the straight-line method to allocate their cost or revalued amounts to their residual values over their estimated useful life. Leased assets are depreciated over the shorter of the lease term and their useful lives unless it is reasonably certain that the Group will obtain ownership by the end of the lease term.

The rates of depreciation used for the current and comparative periods are as follows:

	0/0
Buildings
Fixtures, furniture and fittings	4 - 15
Equipment	20 - 25
Motor vehicles	25
Improvements to premises:
Property leased out from Government	Up to 2028
Property leased out from other third parties	Over the period of the lease agreements
MaltaPost p.l.c. owned properties	Over 15 years

Assets in the course of construction and artefacts are not depreciated. Artefacts are not depreciated since in the opinion of management, their residual value is not less than their original cost.

The asset's residual values and useful lives are reviewed and adjusted if appropriate, at the end of each reporting period. An asset's carrying amount is written down immediately to its recoverable amount if the asset's carrying amount is greater than its estimated recoverable amount (Note 1.7).

Gains and losses on disposal of an item of property, plant and equipment are determined by comparing the proceeds from disposal with the carrying amount and are recognised in profit or loss. When revalued assets are sold, the amounts included in the revaluation reserve relating to the asset are transferred to retained earnings.

1.5 Intangible assets

Computer software

The Group's computer software comprises software purchased from third parties. Costs associated with maintaining computer software programmes are recognised as an expense as incurred. Development costs that are directly attributable to the design of identifiable and unique software products controlled by the Group are recognised as intangible assets when the following criteria are met:

· it is technically feasible to complete the software product so that it will be available for use;
management intends to complete the software product and use or sell it;
there is an ability to use or sell the software product;
it can be demonstrated how the software product will generate probable future economic benefits;
adequate technical, financial and other resources to complete the development and to use or 0 sell the software product are available; and
the expenditure attributable to the software product during its development can be reliably measured.

1.5 Intangible assets - continued

Directly attributable costs that are capitalised as part of the software product include the software development employee costs and an appropriate portion of relevant overheads. Other development expenditures that do not meet these criteria are recognised as an expense as incurred. Development costs previously recognised as an expense are not recognised as an asset in a subsequent period.

Computer software development costs recognised as assets are amortised over their estimated useful lives.

Leasehold rights on buildings

Leasehold rights are initially recognised at their acquisition cost and then amortised over their estimated useful life, which does not exceed the expected lease period, on a straight line basis.

1.6 Impairment of non-financial assets

Assets that have an indefinite useful life, for example goodwill or certain intangible assets, are not subject to amortisation and are tested annually for impairment. Assets that are subject to amortisation are reviewed for impairment whenever events or changes indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cashgenerating units). Non-financial assets other than goodwill that suffered impairment are reviewed for possible reversal of the impairment at the end of each reporting period. Goodwill that forms part of the carrying amount of an investment in a joint venture is not recognised separately, and therefore is not tested for impairment separately. Instead, the entire amount of the investment in a joint venture is tested for impairment as a single asset when there is objective evidence that the investment in a joint venture may be impaired.

Financial assets 1.7

Classification

The Group classifies its financial assets in the following measurement categories:

those to be measured subsequently at fair value (either through Other Comprehensive Income, or through profit or loss); and
those to be measured at amortised cost.

The classification depends on the entity's business model for managing the financial assets and the contractual terms of the cash flows. For assets measured at fair value, gains and losses will either be recorded in profit or loss or Other Comprehensive Income (OCI). For investments in equity instruments that are not held for trading, this will depend on whether the Group has made an irrevocable election at the time of initial recognition to account for the equity investment at fair value through other comprehensive income (FVOCI).

The Group reclassifies debt investments when and only when its business model for managing those assets changes.

1.7 Financial assets - continued

Recognition and derecognition

The Group recognises a financial asset in its statement of financial position when it becomes a party to the contractual provisions of the instrument.

Regular way purchases and sales of financial assets are recognised on settlement date, the date on which an asset is delivered to or by the Group. Financial assets are derecognised when the rights to receive cash flows from the financial assets have expired or have been transferred and the Group has transferred substantially all the risks and rewards of ownership or has not retained control of the asset.

Measurement

At initial recognition, the Group measures a financial asset at its fair value plus, in the case of a financial asset not at fair value through profit or loss (FVPL), transaction costs that are directly attributable to the acquisition of the financial asset. Transaction costs of financial assets carried at FVPL are expensed in profit or loss.

Financial assets with embedded derivatives are considered in their entirety when determining whether their cash flows are solely payment of principal and interest.

Debt instruments

Subsequent measurement of debt instruments depends on the Group's business model for managing the asset and the cash flow characteristics of the asset. There are three measurement categories into which the Group classifies its debt instruments:

· Amortised cost: Assets that are held for collection of contractual cash flows where those cash flows represent solely payments of principal and interest are measured at amortised cost. Interest income from these financial assets is included in finance income using the effective interest rate method. Any gain or loss arising on derecognition is recognised directly in profit or loss and presented in other gains/(losses) together with foreign exchange gains and losses. Impairment losses are presented as a separate line item in the statement of profit or loss, subject to materiality.
FVOCI: Assets that are held for collection of contractual cash flows and for selling the financial assets, where the assets' cash flows represent solely payments of principal and interest, are measured at FVOCI. Movements in the carrying amount are taken through OCI, except for the recognition of impairment gains or losses, interest income and foreign exchange gains and losses which are recognised in profit or loss. When the financial asset is derecognised, the cumulative gain or loss previously recognised in OCI is reclassified from equity to profit or loss and recognised in other gains/(losses). Interest income from these financial assets is included in finance income using the effective interest rate method. Foreign exchange gains and losses are presented in other gains((losses) and impairment losses are presented as a separate line item in the statement of profit or loss.
FVPL: assets that do not meet the criteria for amortised cost or FVOCI are measured at FVPL. A gain or loss on a debt investment that is subsequently measured at FVPL is recognised in profit or loss and presented net within other gains/(losses) in the period in which it arises.

1.7 Financial assets - continued

Equity instruments

The Group subsequently measures all equity investments at fair value. Where the Group's management has elected to present fair value gains and losses on equity investments in OCI, there is no subsequent reclassification of fair value gains and losses to profit or loss following the derecognition of the investment. Dividends from such investments continue to be recognised in profit or loss when the Group's right to receive payments is established.

Changes in the fair value of financial assets at FVPL are recognised in other gains((losses) in the income statement as applicable. Impairment losses (and reversal of impairment losses) on equity investments measured at FVOCI are not reported separately from other changes in fair value.

Impairment

The Group assesses on a forward looking basis the expected credit losses associated with its debt instruments carried at amortised cost and FVOC1. The impairment methodology applied depends on whether there has been a significant increase in credit risk.

For trade receivables and contract assets, the Group applies the simplified approach permitted by IFRS 9, which requires expected lifetime losses to be recognised from initial recognition of the receivables.

For all other financial assets that are subject to impairment under IFRS 9, the Group applies a threestage model for impairment, based on changes in credit quality since initial recognition. A financial asset that is not credit impaired on initial recognition is classified in stage 1.

Financial assets in stage 1, have their expected credit loss measured at amount equal to the portion of lifetime expected credit loss that results from default events possible within the next 12 months, or until contractual maturity if shorter. If the Group identificant increase in credit risk since initial recognition, the asset is transferred to stage 2 and its expected credit loss is measured on a lifetime basis, that is up until contractual maturity. If the Group determines that a financial asset is credit impaired, the asset is transferred to stage 3 and the expected credit loss is measured on a lifetime credit loss basis.

1.8 Inventories

Inventories are stated at the lower of cost and net realisable value. The cost of postal stationery and inventories for resale is determined by a weighted average basis, and other inventory items by a firstin first-out method. The cost of inventories comprises the invoiced value of goods sold and in general includes transport and handling costs. Net realisable value is the selling price in the ordinary course of business, less the costs of completion and selling expenses.

1.9 Trade and other receivables

Trade receivables comprise amounts due from customers for merchandise sold or services performed in the ordinary course of business. If collection is expected in one year or less (or in the normal operating cycle of the business if longer), they are classified as current assets. If not, they are presented as non-current assets.

Trade receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, less expected credit loss allowances in accordance with accounting policy 1.7. The carrying amount of the asset is reduced through the use of an allowance account, and the amount of the loss is recognised in profit or loss. When a receivable is uncollectible, it is written off against the allowance account for trade and other receivables. Subsequent recoveries of amounts previously written off are credited in profit or loss.

1.10 Cash and cash equivalents and deposits with financial institutions

Cash and cash equivalents and deposits with financial institutions are carried in the statement of financial position at face value. In the statement of cash and cash equivalents includes cash in hand and deposits held at call with banks, whereas deposits which exceed the three month term are classified and presented as deposits with financial institutions.

1.11 Share capital and share premium

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new ordinary shares are shown in equity as a deduction, net of tax, from the proceeds. When shares are issued at a premium, the difference between the proceeds and the share's par value is recognised in a share premium reserve.

1.12 Financial liabilities

The Group recognises a financial liability in its statement of financial position when it becomes a party to the contractual provisions of the instrument. Financial liabilities are recognised initially at fair value, being the fair value of consideration received, net of transaction costs that are directly attributable to the acquisition or the issue of the financial liability. These other liabilities are subsequently measured at amortised cost.

The Group derecognises a financial liability from its statement of financial position when the obligation specified in the contract or arrangement is discharged, is cancelled or expires.

1.13 Trade and other payables

Trade payables comprise obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if payment is due within one year or less (or in the normal operating cycle of the business if longer). If not, they are presented as non-current liabilities.

Trade and other payables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method.

1.14 Borrowings

Borrowings are recognised initially at the fair value, net of transaction costs incurred. Borrowings are subsequently carried at amortised cost; any difference between the proceeds (net of transaction costs) and the redemption value is recognised in profit or loss over the period of the borrowings using the effective interest method.

Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at least twelve months after the reporting date.

1.15 Offsetting financial instruments

Financial assets and liabilities are offset and the net amount reported in the statement of financial position when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis, or realise the asset and settle the liability simultaneously.

The Group has agreements in place with third parties to collect, through the Group's outlet network, amounts due to these third parties owed by their customers. Any amounts collected in respect of these agreements are retained by the Group until settlement with the respective third parties, during which time the Group is exposed to the risks and rewards emanating from the amounts collected. Such amounts are therefore presented within assets with a corresponding liability towards the third party presented within trade and other payables.

1.16 Current and deferred tax

The tax expense for the period comprises current and deferred tax. Tax is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, the tax is also recognised in other comprehensive income or directly in equity, respectively.

Deferred tax is recognised, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. However, deferred tax liabilities are not recognised if they arise from the initial recognition of goodwill; deferred tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss. Deferred tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the end of the reporting period and are expected to apply when the related deferred tax asset is realised or the deferred tax liability is settled.

Deferred income tax assets are recognised only to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilised. Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities and when the deferred income tax assets and liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities where there is an intention to settle the balances on a net basis.

1.17 Provisions

Provisions are recognised when the Group has a present legal or constructive obligation as a result of past events, when it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and when a reliable estimate of the amount of the obligation can be made.

Provisions are measured at the present value of the expenditures expected to be required to settle the obligation using a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the obligation.

The Company provides for the obligation arising in terms of Article 8A of the Pensions Ordinance, Cap 93 of the laws of Malta, covering those ex-Government employees who opted to become fulltime employees of the Company, and who continued to be entitled to pension rights which go beyond the National Insurance Scheme.

The liability recognised in the statement of financial position is the present value of the defined benefit obligation at the end of the reporting period. A defined benefit obligation is calculated annually using the projected unit credit method. The present value of a defined benefit obligation is determined by discounting the estimated future cash outflows using interest rate yields of Government bonds that have terms to maturity approximating to the terms of the related pension liability.

Actuarial gains and losses arising from experience adjustments and changes in actuarial assumptions are charged or credited to equity in other comprehensive in the period in which they arise. Past-service costs are recognised immediately in profit or loss.

1.18 Revenue recognition

Revenue comprises the fair value of the consideration receivable for the sale of services in the ordinary course of the Group's activities. Revenue is shown net of sales taxes and discounts and is included in the financial statements as revenue. It comprises revenue directly received from customers, commissions earned on postal and non-postal transactions and income from foreign outbound mail receivable from foreign postal administrators. Revenue is recognised as follows: income from sale of stamps, commissions earned on postal transactions and from foreign inbound mail is recognised when the service is rendered. Allowance is made for the assessed amount of revenue from prepaid product sales at the reporting date for which the service has not yet been provided.

IFRS 15 requires that at contract inception the goods or services promised in a contract with a customer are assessed and each promise to transfer to the customer the good or service is identified as a performance obligation. Promises in a contract can be explicit or implicit if the promises create a valid expectation to provide a good or service based on the customary business practices, published policies, or specific statements.

A contract asset must be recognised if the Company recorded revenue for fulfillment of a contractual performance obligation before the customer paid consideration or before - irrespective of when payment is due - the requirements for billing and thus the recognition of a receivable exist.

A contract liability must be recognised when the customer paid consideration or a receivable from the customer is due before the Company fulfilled a contractual performance obligation and thus recognised revenue.

1.18 Revenue recognition - continued

Multiple-element arrangements involving the delivery or provision of multiple products or services must be separated into distinct performance obligations, each with its own separate revenue contribution that is recognised as revenue on fulfillment of the obligation to the customer. The total transaction price of a bundled contract is allocated among the individual performance obligations based on their relative - possibly estimated - stand-alone selling prices, i.e., based on a ratio of the stand-alone selling price of each separate element to the aggregated stand-alone selling prices of the contractual performance obligations.

A contract modification exists where the Group and the customer approve a modification that either creates new, or changes existing, enforceable rights and obligations of both parties. The Group accounts for a contract modification as a separate contract where the scope of the contract increases because of the addition of distinct promised services, and the price of the contract increases by an amount of consideration that reflects the stand-alone selling price of those additional promised services. A modification that is not accounted for as a separate contract is accounted for as an adjustment to the existing contract, either prospectively or through a cumulative catch-up adjustment. depending on whether the remaining goods or services to be provided to the customer under the modified contract are distinct.

The Group measures revenue on a basis that reflects the amount of consideration that it expects to be entitled to; this measurement of revenue is however limited to amounts to which the Group has enforceable rights, and it excludes amounts collected on behalf of third parties.

Revenue is recognised when the Group satisfies a performance obligation, which occurs when it transfers control of a promised good or service to a customer. Control of a promised good or service is transferred to a customer when the customer is able to direct the use of the promised good or service. A performance obligation is satisfied at a point in time unless it meets certain criteria that indicate that it is satisfied over time.

Management has determined that none of the Group's contracts with customers contain a significant financing component as the period between the recognition of revenue and the payment due date is of less than one year.

Other income is recognised as follows:

(a) finance income is recognised as it accrues on a time proportion basis using the effective interest method, unless collectability is in doubt;
(b) dividend income is recognised when the right to receive payment is established.

1.19 Customer contract assets and liabilities

The timing of revenue recognition may differ from customer invoicing. Trade receivables presented in the statement of financial position represent an unconditional right to receive consideration (primarily cash), i.e. the services and goods promised to the customer have been transferred.

By contrast, contract assets mainly refer to amounts allocated per IFRS 15 as compensation for goods or services provided to customers for which the right to collect payment is subject to providing other services or goods under that same contract. Contract assets, like trade receivables, are subject to impairment for credit risk. The recoverability of contract assets is also verified, especially to cover the risk of impairment should the contract be interrupted.

Contract liabilities represent amounts paid by customers before receiving the goods and/or services promised in the contract. This is typically the case for advances received from customers or amounts invoiced and paid for goods or services not transferred yet, such as contracts payable in advance or prepaid stamps (previously recognised in deferred income).

1.20 Government grants

Grants from Government are recognised at their fair value where there is a reasonable assurance that the grant will be received, and the Group with all attached conditions.

Government grants relating to costs are deferred and recognised in the income statement over the period necessary to match them with the costs that they are intended to compensate.

Government grants relating to property, plant and equipment are included in non-current liabilities as deferred government grants and are credited to profit or loss on a straight-line basis over the expected lives of the related assets.

1.21 Leases

The Group is the lessee

At inception of a contract, an entity shall assess whether the contract is, or contains, a lease. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration.

With effect from 1 October 2020, leases are recognised as a right-of-use asset and a corresponding liability at the date at which the leased asset is available for use by the Group.

1.21 Leases - continued

The Group is the lessee - continued

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

fixed payments (including in-substance fixed payments), less any lease incentives receivable;
variable lease payments that are based on an index or a rate, initially measured using the index or rate as at the commencement date;
amounts expected to be payable by the Group under residual value guarantees;
the exercise price of a purchase option if the Group is reasonably certain to exercise that option; and
payments of penalties for terminating the lease, if the lease term reflects the Group exercising that option.

Lease payments to be made under reasonably certain extension options are also included in the measurement of the liability.

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

To determine the incremental borrowing rate, the Group:

where possible, uses recent third-party financing received by the lessee as a starting point, adjusted to reflect changes in financing conditions since third party financing was received;
uses a build-up approach that starts with a risk-free interest rate adjusted for credit risk for leases held by the Group, where there is no third party financing; and
makes adjustments specific to the lease, e.g. term, country, currency and security.

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

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

the amount of the initial measurement of lease liability;
any lease payments made at or before the commencement date less any lease incentives received; and
any initial direct costs.

Right-of-use assets are generally depreciated over the shorter of the asset's useful life and the lease term on a straight-line basis. If the Group is reasonably certain to exercise a purchase option, the right-of-use asset is depreciated over the underlying asset's useful life.

Payments associated with short-term leases of equipment and vehicles and all leases of low-value assets are recognised on a straight-line basis as an expense in profit or loss. Short-term leases are leases with a lease term of 12 months or less. In determining the lease term, management considers all facts and circumstances that create an economic incentive to exercise an extension option, or not exercise a termination option. Extension options (or periods after termination options) are only included in the lease term if the lease is reasonably certain to be extended (or not terminated).

1.21 Leases - continued

The Group is the lessee - continued

For leases of properties, the following factors are normally the most relevant:

if there are significant penalties to terminate (or not extend), the Group is typically reasonably certain to extend (or not terminate);
if any leasehold improvements are expected to have a significant remaining value, the Group is typically reasonably certain to extend (or not terminate);
. otherwise, the Group considers other factors including historical lease durations and the costs and business disruption required to replace the leased asset.

The lease term is reassessed if an option is actually exercised (or not exercised) or the Group becomes obliged to exercise (or not exercise) it. The assessment of reasonable certainty is only revised if a significant event or a significant change in circumstances occurs, which affects this assessment, and that is within the control of the lessee.

The Group is the lessor

Operating leases

Assets leased out under operating leases are included in property, plant and equipment in the statement of financial position and are accounted for in accordance with Note 1.4. They are depreciated over their expected useful lives on a basis consistent with similar owned property, plant and equipment. Rental income from operating leases is recognised in profit or loss on a straight-line basis over the lease term.

1.22 Dividends

Dividend distribution to the Company's shareholders is recognised as a liability in the Company's financial statements in the period in which the dividends are approved by the Company's shareholders.

The Company measures a liability to distribute non-cash as a dividend to its owners at the fair value of the assets to be distributed. Upon settlement of the dividend payable the Company recognises the difference between the carrying amount of the assets to be distributed and the carrying amount of the dividend payable in profit or loss.

1.23 Segment reporting

The Group determines and presents operating segments based on the information that internally is provided to the Board of Directors, which is the Group's chief operating decision-maker in accordance with the requirements of IFRS 8, Operating Segments. An operating segment is a component of the Group that engages in business activities from which it may earn revenues and incur expenses, including revenues and expenses that relate to transactions with any of the Group's other components, and for which discrete financial information is available. An operating segment's operating results are reviewed regularly by the Board of Directors to make decisions about resources to be allocated to the segment and to assess its performance executing the function of the chief operating decision-maker.

1.24 Earnings per share

The Company presents earnings per share (EPS) data for its ordinary shares. EPS is calculated by dividing the profit or loss attributable to ordinary shareholders of the weighted average number of ordinary shares outstanding during the period.

Financial risk management 2.

2.1 Financial risk factors

The Group's activities potentially expose it to a variety of financial risk (including currency risk, fair value interest rate risk, cash flow interest rate risk), credit risk and liquidity risk. The Group's overall risk management focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the financial performance.

The Board provides principles for overall risk management, as well as policies covering specific areas, such as foreign exchange risk, interest rate risk, use of derivative financial instruments and non-derivative financial instruments, and investment of excess liquidity.

(a) Market risk

(i) Foreign exchange risk

Foreign exchange risk arises from future commercial transactions and recognised assets and liabilities which are denominated in a currency that is not the functional currency. The Group is exposed to foreign exchange risk arising primarily from the Group's sales and purchases attributable to its postal activities, a part of which are denominated in SDR. The table below summarises the main exposure to foreign currencies analysing the exposure of assets and liabilities by foreign currency, focusing on invoiced amounts:

	Group and Company 20129 2020
Financial assets Trade receivables	€ 000	€ 000
SDR	1,404	920
Financial liabilities Trade payables SDR	(6,013)	(3,911)
Net exposure to foreign currency risk	(4,609)	(2,991)

Management does not deem the Group's exposure to foreign currencies reflected in the table above to be significant. Foreign exchange risk is not considered significant, taking cognisance of the impact of exchange fluctuations on the net financial position exposures as at the reporting dates and the staged short settlement periods for both assets and liabilities denominated in SDR. A sensitivity analysis for foreign exchange risk disclosing how profit or loss and equity would have been affected by changes in foreign exchange rates that were reasonably possible at the end of the reporting periods is not accordingly deemed necessary since the Directors are of the opinion that the net impact would be insignificant. Also foreign exchange risk attributable to future transactions is not deemed to be significant.

2. Financial risk management - continued

2.1 Financial risk factors - continued

(a) Market risk continued
(ii) Cash flow and fair value interest rate risk

The Group's interest rate risk arises principally from term deposits (subject to fixed interest rates), fixed income debt securities and cash and cash equivalents (subject to floating interest rates). Assets earning interest at variable rates expose the Group to cash flow interest rate risk whereas assets earning interest at fixed rates expose the Group to fair value interest rate risk.

The Group's fixed income debt securities, categorised as financial assets at fair value through other comprehensive income, consist principally of corporate and Government debt securities, and constitute the Group's only financial instruments carried at fair value.

Management does not consider cash flow and fair value interest rate risk to be significant in view of the nature and terms of the instruments highlighted above. Accordingly, a sensitivity analysis for this risk disclosing how profit or loss and equity would have been affected by changes in interest rates that were reasonably possible at the end of the reporting period is not deemed necessary.

(b) Credit risk

Credit risk arises from cash and cash equivalents, deposits with banks, financial investments, as well as credit exposures to customers including outstanding receivables and committed transactions. The carrying amount of the financial assets represents the maximum credit exposure. The maximum exposure to credit risk at the reporting date was:

	Notes	Group		Company
		2029 (3000)	2020 € 0,00	2021 E 000	2020 € 000
Financial assets: At fair value through other comprehensive income:
Debt securities	9	2,900	3,561	2,900	3,561
At amortised costs:
Trade and other receivables	12	9.357	7,809	9,172	7,809
Deposits with financial institutions	13	6,200	5,600	6,200	5,600
Cash and cash equivalents	14	4,943	6,058	4,206	6.072
Business of insurance accounts	14	448
		23,848	23,028	22,478	23.042

The maximum exposure to credit risk at the reporting date as reflected by the carrying amount of financial investments, credit exposures to customers and cash equivalents is disclosed in the table above and the respective notes to the financial statements. The figures disclosed in the table above in respect of trade and other receivables exclude prepayments and indirect taxation.

2. Financial risk management - continued

2.1 Financial risk factors - continued

(b) Credit risk - continued

Financial assets at fair value through other comprehensive income

The Group's financial investments comprise listed sovereign debt securities having a carrying amount of €1.6 million (2020: €1.7 million) with a credit rating of A, as well as listed debt securities issued by corporates having a carrying amount of €0.6 million (2020: €0.6 million) with a credit rating of BBB. The remaining investments in listed debt instruments issued by local corporates with a carrying amount of €0.6 million (2020: €1.3 million) are unrated. Low credit risk simplification is applied for listed sovereign debt securities. Other listed debt securities are considered by the Directors to have low credit risk as the probability of default is considered to be close to zero as the counterparties have a strong capacity to meet their contractual obligations in the near term. As a result, financial assets at fair value through other comprehensive income are classified under Level 1 and no loss allowance has been recognised based on 12-month expected credit loss, as any such impairment would be wholly insignificant to the Group and the Company.

Deposits with financial institutions, Cash and cash equivalents and Business of insurance accounts

Entities forming part of the Group principally bank with local and European financial institutions with high-quality standing or rating. Balances are primarily callable on demand or within a maximum period of 1 week. Low credit risk simplification is applied and the Directors consider the probability of default to be close to zero as the counterparties have a strong capacity to meet their contractual obligations in the near term. As a result, no loss allowance has been recognised based on 12-month expected credit loss as any such impairment would be wholly insignificant to the Group and the Company.

Amounts owed by related parties

The Group's receivables include amounts owed by related parties (Note 12). The Group monitors credit exposures with related parties at an individual entity level on a regular basis and ensures timely performance of these assets in the context of overall Group liquidity management. The Group assesses the credit quality of these related parties taking into account financial position, performance and other factors. The Group takes cognisance of the related party relationship with these entities and management does not expect any significant losses from non-performance or default.

Expected credit losses, based on the assumption that repayment of the balance is on demand, are deemed to be insignificant to the Group and the Company.

Trade and other receivables (including contract assets)

The Group assesses the credit quality of its customers taking into account financial position, past experience and other factors. It has policies in place to ensure that sales of products and services are effected to customers with an appropriate credit history in the case of credit sales to retail customers are effected in cash.

Standard credit terms are in place for individual clients, however, wherever possible, new corporate customers are analysed individually for creditworthiness before the Group's standard payment and service delivery terms and conditions are offered. The Group establishes an allowance for impairment that represents its estimate of incurred losses in respect of trade and other receivables. This allowance represents specific provisions against individual exposures.

Financial risk management - continued 2.

2.1 Financial risk factors - continued

(b) Credit risk - continued

The Group applies the IFRS 9 simplified approach to measuring expected credit losses which uses a lifetime expected loss allowance for all trade receivables and contract assets. To measure the expected credit losses, trade receivables and contract assets have been grouped based on shared credit risk characteristics and the days past due. Contract assets have substantially the same risk characteristics as the trade receivables for the same types of contracts.

The Group monitors the performance of its financial assets on a regular basis to identify incurred collection losses which are inherent in the Group's receivables taking into account historical experience in collection of accounts receivable.

The expected loss rates are based on the payment profiles of sales over a period of time before the reporting date and the corresponding historical credit losses experienced within this period. The historical loss rates are adjusted to reflect current and forward-looking information on macroeconomic factors affecting the ability of the customers to settle the receivables. The Group adjusts the historical loss rates based on expected changes in these factors. Credit loss allowances include specific provisions against credit impaired individual exposures with the amount of the provisions being equivalent to the balances attributable to credit impaired receivables. As a result of the outbreak of COVID-19, the Group engaged in routine monitoring of the account activity and repayment patterns of its receivables. For this purpose, customers were segmented based on shared credit risk characteristics predominantly by economic sector, and accordingly receivables pertaining to those segments which have been impacted by COVID-19 were subjected to more rigorous monitoring. The Group has not experienced a material shift in repayment patterns attributable to its customers post the COVID-19 outbreak, with no significant deterioration in collection rates detected. The Group has also engaged in monitoring information available on macro-economic factors affecting customer repayment ability, with a view to also assess the actual and projected impact of the pandemic on the business models of the customers serviced by the Group and accordingly on their repayment ability. As a result of these assessments, at 30 September 2021, the Group determined that the level of expected credit losses has not materially changed taking cognisance of the projected impact on the repayment ability of the Group's customers, the repayment pattern actually experienced, and the estimated life of trade receivables.

2. Financial risk management - continued

2.1 Financial risk factors - continued

(b) Credit risk - continued

As at 30 September 2021 the Group was exposed to concentration of credit risk with 50% (2020: 44%) of its trade receivables being attributable to three (2020: three) postal administrators. The Group assesses the credit quality of these administrators by taking into account financial position, performance and other factors. The Group also takes cognisance of the fact that balances with postal administrators in respect of terminal dues are generally cleared and settled through a central clearing house which acts as a credit risk mitigant. Trade receivables include €6.7 million (2020: €5.3 million) terminal due receivables.

The Group established an allowance for impairment that represented its estimate of expected credit losses in respect of trade receivables. The individually credit impaired trade receivables mainly relate to a number of independent customers which are in unexpectedly difficult economic situations and which are accordingly not meeting repayment obligations. Hence, provisions for impairment in respect of credit impaired balances with corporate trade customers relate to entities which are in adverse trading and operational circumstances.

As at 30 September 2021, the Group and the Company had trade receivables amounting to €6,092,000 (2020: €4,315,000) and €5,856,000 (2020: €4,315,000) respectively which were fully performing whilst trade receivables amounting to €248,000 (2020: €428,000) and €238,000 (2020: E428,000) were past due but not impaired. These dues relate to a number of independent parties for whom there is no recent history of default. Trade receivable amounting to €311,000 (2020: €189,000) for the Group and €129,000 (2020: €189,000) for the Company were overdue by at least three months, whereas €109,000 (2020: €239,000) were overdue by at least nine months for the Group and the Company. The movement in provisions for credit loss in respect of trade receivables during the year was as follows:

	Group		Company
	2021 € 000	2020 € 000	2022 = 000	2020 € 000
At beginning of year Acquisition of subsidiary	104 172	77	104	77
Increase in provisions	2	27	2	27
At end of year	278	104	106	104

Reversals of provisions of impaired receivables arise in those situations where customers recover from unfavourable circumstances and accordingly start meeting repayment obligations.

The Group does not hold any significant collateral as security in respect of the credit impaired assets. The movements in credit loss allowances of these receivables are disclosed above.

Trade receivables and contract assets are written off when there is no reasonable expectation of recovery. Indicators that there is no reasonable expectation of recovery include, amongst others, the failure of a debtor to engage in a repayment plan with the Group, and a failure to make contractual payments for a period of greater than a year past due.

Credit losses on trade receivables and contract assets are presented as net expected credit losses and other impairment charges within operating profit. Subsequent recoveries of amounts written off are credited against the same line item.

2. Financial risk management - continued

2.1 Financial risk factors - continued

(b) Credit risk - continued

The Group considered that there was evidence of impairment if any of the following indicators were present:

· significant financial difficulties of the debtor;
· probability that the debtor will enter bankruptcy or financial reorganisation; and
· default or late payments.

Receivables for which an expected credit loss provision was recognised were written off against the provision when there was no expectation of recovering additional cash.

(c) Liquidity risk

The Group is exposed to liquidity risk in relation to meeting future obligations associated with its financial liabilities, which comprise principally lease liabilities and trade and other payables (Notes 17 and 19). Prudent liquidity risk management includes maintaining sufficient cash and committed credit lines to ensure the availability of an adequate amount of funding to meet the Group's obligations.

Management monitors liquidity risk by means of cash flow forecasts on the basis of expected cash flows over a twelve month period and ensures that adequate financing facilities are in place for the coming year. The carrying amounts of the Group's assets and liabilities are analysed into relevant maturity groupings based on the remaining period at the end of the reporting period to the contractual maturity date in the respective notes to the financial statements, where deemed applicable.

The Group's liquidity risk is not deemed material in view of the matching of cash inflows and outflows arising from expected maturities of financial instruments, coupled with financing facilities that it can access to meet liquidity needs. The Group's trade and other payables are entirely repayable within one year from the end of the reporting period.

2.2 Capital risk management

Capital is managed by reference to the level of the Company's equity and borrowings or debt as disclosed in the financial statements of the Company. The Group's objectives when managing capital are to safeguard the Company's ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders, and to maintain an optimal structure to reduce the cost of capital. In order to maintain or adjust the capital structure, the Company may issue new shares or adjust the amount of dividends paid to shareholders.

The Group's equity, as disclosed in the statement of financial position, constitutes its capital. The Group maintains the level of capital by reference to its financial obligations and commitments arising from operational requirements. In view of the nature of the Company's activities and the extent of borrowings or debt, the capital level as at the end of the reporting period is deemed adequate by the Directors.

2. Financial risk management - continued

2.3 Fair values of financial instruments

In accordance with IFRS 7, for financial instruments that are measured in the statement of financial position at fair value, disclosure of fair value measurements by level of the following fair value measurement hierarchy is required:

· quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1);

· inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices) (Level 2);
· inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs) (Level 3).

	Group and Company Leve 1
	20221 = 000	2020 € 000
Assets Financial assets at fair value through other comprehensive income:
Debt securities (Note 9)	2,900	3.561

The fair value of financial assets at fair value through other comprehensive income which are traded in active markets, is based on quoted market prices at the reporting date. The quoted market price used for financial assets held by the entity is the current bid price.

The carrying amounts of cash and cash equivalents, term placements, receivables (net of impairment provisions) and payables are assumed to approximate their fair values in view of the short term nature of the instruments.

3. Critical accounting estimates and judgements

Estimates and judgements are continually evaluated and based on historical experience and other factors including expectations of future events that are believed to be reasonable under the circumstances.

The Group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. These estimates and assumptions present a risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year. The Group's management also makes judgements, apart from those involving estimations, in the process of applying the entity's accounting policies that may have a significant effect on the amounts recognised in the financial statements.

The Group's land and buildings category of property, plant and equipment is fair valued on the basis of professional advice, which considers current market prices for the properties. Fair valuation of property requires the extensive use of judgement and estimates.

Assessment of matters referred to above

In the opinion of the Directors, the accounting estimates and judgements made in the course of preparing these consolidated financial statements, which have been highlighted above, are not difficult, subjective or complex to a degree which would warrant their description as critical in terms of the requirements of IAS 1.

The Directors also draw attention to the fact that there are no assumptions and other major sources of estimation uncertainty at the end of the reporting period, that have a significant risk of resulting in a material adjustment to the carrying amounts of assets and liabilities within the next financial year.

4. Property, plant and equipment

Group

	Land and buildings €.000	Improvements to leasehold properties € 000	Fixtures, furniture and fittings €.000	Equipment € 000	Motor vehicles € 000	Total € 000
At 1 October 2019 Cost or valuation Accumulated depreciation	13,644 (45)	1,357 (632)	6,936 (4,210)	7,070 (6,358)	387 (246)	29,394 (11,491)
Net book amount	13,599	725	2,726	712	141	17,903
Year ended 30 September 2020 Opening net book amount	13,599	725	2,726	712	141	17,903
Additions Disposals and write-offs	618	120 (2)	248 (897)	370 (1,433)	385 (a)	1,741 (2,341)
Depreciation	(49)	(105)	(288)	(380)	(73)	(895)
Depreciation released on disposals and write-offs		2	897	1,433	9	2,341
Closing net book amount	14,168	740	2,686	702	453	18,749
At 30 September 2020
Cost or valuation	14,262	1,475	6,287	6,007	783	28,794
Accumulated depreciation	(94)	(735)	(3,601)	(5,305)	(310)	(10,045)
Net book amount	14,168	740	2,686	702	453	18,749
Year ended 30 September 2021
Opening net book amount	14,168	740 127	2,686	702	453	18,749
Additions Acquisition of subsidiary	1,976		470 2	220 4	52	2,845 6
Reclassifications	48	(41)	(7)
Disposals and write-offs Depreciation	(58)	(124)	(298)	(9) (318)	(154)	(9) (952)
Depreciation released on disposals and write-offs Revaluation surplus arising during the year:				9		9
Effect on cost or valuation Effect on accumulated	1,489					1,489
depreciation	152					152
Closing net book amount	17,775	702	2,853	603	351	22,289
At 30 September 2021 Cost or valuation	17,775	1,561	6,822	6,467	815	33,440
Accumulated depreciation		(859)	(3,969)	(5,859)	(464)	(11,151)
Net book amount	17,775	702	2,853	203	351	22,289

Company

	Land and buildings €.000	Improvements to leasehold properties €,000	Fixtures, Furniture and fittings €,000	Equipment € 000	Motor vehicles € 000	Total €,000
At 1 October 2019
Cost or valuation	13,644	1,357	6,936	7,070	387	29,394
Accumulated depreciation	(45)	(632)	(4,210)	(6,358)	(246)	(11,491)
Net book amount	13,599	725	2,126	712	141	17,903
Year ended
30 September 2020 Opening net book amount	13,599	725	2,726	712	141
Additions	618	120	248	370	385	17,903 1,741
Disposals and write-offs		(2)	(897)	(1,433)	(a)	(2,341)
Depreciation	(49)	(105)	(288)	(380)	(73)	(895)
Depreciation released on
disposals and write-offs		2	897	1,433	0	2,341
Closing net book amount	14.168	740	2,686	702	453	18,749

At 30 September 2020 Cost or valuation	14,262	1,475	6,287	6,007	763
Accumulated depreciation	(94)	(735)	(3,601)	(5,305)	(310)	28,794 (10,045)
Net book amount	14,168	740	2,686	702	453	18,749
Year ended 30 September 2021
Opening net book amount	14,168	740	2,686	702	453	18,749
Additions	1,976	17	470	220	52	2,735
Reclassification	48	(41)	(7)
Disposals and write-offs Depreciation	(58)	(124)	(297)	(9)		(9)
Depreciation released on				(318)	(154)	(951)
disposals and write-offs Revaluation surplus arising				9		9
during the year: Effect on cost or valuation Effect on accumulated	1,489					1,489
depreciation	152					152
Closing net book amount	17,775	292	2,852	604	351	22,174

At 30 September 2021
Cost or valuation Accumulated depreciation	17,775	1,451 (859)	6,750 (3,898)	6,218 (5,614)	815 (464)	33,009 (10,835)

Net book amount	17,775	592	2,852	204	351	22,174

Property, plant and equipment include assets relating to the Company's postal museum as follows:

	Group and Company Carrying amount
2021	2020
	€'000
1,995	1.153
878	943
2,873	2,096
	€ 000

Fair valuation of property

The land and buildings within property, plant and equipment were revalued on 30 September 2021 by an independent firm of property valuers having appropriate recognised professional qualifications and experience in the location and category of the property being valued. Management had reviewed the carrying amounts of the properties as at 30 September 2021 and adjustments to the carrying amount amounted to €1,641,000.

Valuations were made on the basis of open market value taking cognisance of the specific location of the properties, the size of the sites together with their development potential, the availability of similar properties in the area, and whenever possible, having regard to recent market transactions for similar properties in the same location.

The Group is required to analyse non-financial assets carried at fair value by level of the fair value hierarchy within which the recurring fair value measurements are categorised in their entirety (Level 1, 2 or 3). The different levels of the fair value hierarchy have been defined as fair value measurements using:

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

The Group's land and buildings, within property, plant and equipment, comprises the head office, mail delivery hubs and retail outlets. All the recurring property fair value measurements use significant unobservable inputs and are accordingly categorised within Level 3 of the fair valuation hierarchy.

The Group's policy is to recognise transfers into and out of fair value hierarchy levels as of the beginning of the reporting period. There were no transfers between different levels of the fair value hierarchy during the year ended 30 September 2020 and 30 September 2021.

A reconciliation from the opening balance to the closing balance of land and buildings for recurring fair value measurements categorised within Level 3 of the value hierarchy, is reflected in the table above.

Valuation processes

The valuations of the properties will be performed regularly on the basis of valuation reports prepared by independent and qualified valuers. These reports are based on both:

· information provided by the Group which is derived from the Group's financial systems and is subject to the Group's overall control environment; and
assumptions and valuation models used by the valuers the assumptions are typically market related. These are based on professional judgement and market observation.

The information provided to the valuers, together with the assumptions and the valuation models used by the valuers, are reviewed by the Chief Financial Officer (CFO). This includes a review of fair value movements. When the CFO considers that the valuation report is appropriate, the valuation report is recommended to the Audit and Risk Committee. The Audit and Risk Committee considers the valuation report as part of its overall responsibilities.

At the end of every reporting period, the CFO will assess whether any significant changes or developments have been experienced since the last external valuation. This is supported by an assessment performed by the independent firm of property valuers. The CFO reports to the Audit and Risk Committee on the outcome of this assessment.

Valuation techniques

The external valuations of the Level 3 property have been performed using an adjusted sales comparison approach for the land component and the replacement cost approach for the buildings component.

In view of a limited number of similar sales in the local market, the valuations have predominantly been performed using unobservable inputs. The significant input to the adjusted sales comparison approach is generally a sales price per square metre related to transactions in comparable properties located in proximity to the Group's property, with significant adjustments for differences in the size, age, exact location and condition of the property. The significant input to the replacement cost approach is the estimated development costs per square metre.

Information about fair value measurements using significant unobservable inputs (Level 3)

At 30 September 2021 and 2020

Group and Company Description by class based on highest and best use	Fair value (5	technique	Significant Valuation unobservable input	Range of unobservable inputs (weighted average)
Current use as office premises, retail outlets and mail delivery hubs	17.8 million (2020: 14.2 million)	Adjusted sales comparison approach	Sales price per square metre	1,200 - 4,400

The Group's improvements to premises not owned by the Group, with a carrying amount of €1,118,000 (2020: €715,000), have not been included in the analysis above.

The higher the sales price per square metre or the development costs per square metre, the higher the resultant fair valuation.

The highest and best use of the Group's properties is equivalent to their current use.

If the land and buildings were stated on the historical cost basis, the carrying amounts would be as follows:

		Group and Company
	2022	2020
	€'000	€'000
Cost	13,524	11,555
Accumulated depreciation	(525)	(449)
Net book amount	12,999	11,106

5. Right-of-use assets

The statement of financial position reflects the following assets relating to leases:

	Group and Company
	2021	2020
	€'000	€'000
Properties	1,338	1,548
Motor vehicles	196	257
Total right-of-use assets	1,534	1,805

The movement in the carrying amount of these assets is analysed in the following table:

	Group and Company
2021 #000	2020 €'000
1,805 25 (296)	2,080 (275)
1,534	1,805

6. Intangible assets

Group	Leasehold € 000	Computer software € 0000	Total €'000
At 1 October 2019 Cost Accumulated amortisation		859 (171)	859 (171)
Net book amount		688	688
Year ended 30 September 2020 Opening net book amount Additions Amortisation		688 586 (326)	638 586 (326)
Closing net book amount		948	948
At 30 September 2020 Cost Accumulated amortisation		1,445 (497)	1,445 (497)
Net book amount		948	948
Year ended 30 September 2021 Opening net book amount Acquisition of subsidiary Additions Amortisation	141 (18)	948 632 (536)	948 141 632 (554)
Closing net book amount	123	1,044	1,167
At 30 September 2021 Cost Accumulated amortisation	141 (18)	2,077 (1,033)	2,218 (1,051)
Net book amount	123	1,044	1,167

	MALTAPOST p.l.c.
Annual Financial Report and Consolidated Financial Statements - 30 September 2021

6. Intangible assets - continued

Company	Computer software €,000
At 1 October 2019 Cost Accumulated amortisation	859 (171)
Net book amount	688
Year ended 30 September 2020 Opening net book amount Additions Amortisation	688 586 (326)
Closing net book amount	948
At 30 September 2020 Cost Accumulated amortisation	1,445 (497)
Net book amount	948
Year ended 30 September 2021 Opening net book amount Additions Amortisation	948 632 (536)
Closing net book amount	1,044
At 30 September 2021 Cost Accumulated amortisation	2,077 (1,033)
Net book amount	1,044

7. Investment in subsidiaries

	Company
	2021 €'000	2020 €'000
Cost and carrying amount at beginning of year Additions	415
Cost and carrying amount at end of year	416

The carrying amount of the investment at 30 September 2021 and 2020 is equivalent to the cost of investment. The subsidiaries at 30 September 2021 and 2020 is shown below:

Subsidiary	Registered office	Percentage of 2012	Nature of business
Tanseana Limited	305, Qormi Road, Marsa, MTP 1001. Malta	100%	100% ordinary shares Document	management services
Ciantar Brothers Limited	22, Warehouse il- Moll tal-Pont. Marsa MRS1400. Malta	100%	- ordinary shares Warehousing
Limited	Postalnsure Agency 4, Old Bakery Street, Valletta, VLT 1450 Malta	49%		- ordinary shares Insurance agent

Acquisition of controlling stake in subsidiaries

Ciantar Brothers Limited

On 26 April 2021, MaltaPost entered into a share purchase agreement with Ciantar Brothers Limited (CBL), a limited liability company registered in Malta under the Companies Act (Cap.386), with registration number C 577 and registered office at 22, Warehouse il-Moll tal-Pont, Marsa MRS1400, for the purchase of 100% of the issued share capital for a consideration of €140,000. The transfer of shares was affected on 6 May 2021.

	€'000
Fair value of 100% equity holding in CBL as at acquisition date	139

The fair value of identifiable assets and liabilities of CBL as at date of acquisition was as follows:

Group	€'000
Net identifiable liabilities acquired Leasehold intangible	(2) 141
	139

7. Investment in subsidiaries - continued

In the twelve-month period to 30 September 2021, CBL did not operate. CBL is principally engaged in leasing warehouse space, a service offering that is ancillary to services currently provided by MaltaPost. This acquisition is expected to give rise to synergies within the Group. The impact of this acquisition on MaltaPost's consolidated and stand-alone financial statements was insignificant.

Payments for acquisition of subsidiaries, net of cash acquired

The amounts presented in the statement of cash flows comprise the payments referred to above of €139,000, net of cash and cash equivalents attributable to the operations taken over at acquisition date.

Postalnsure Agency Limited

On 5 November 2020, MaltaPost entered into a share purchase agreement with Postalnsure Agency Limited (Postalnsure), formerly Untours Insurance Agents Limited liability company registered in Malta under the Companies Act (Cap.386), with registration number C 5655 and registered office at 4, Old Bakery Street, Valletta, for the purchase of 49% of the issued share capital for a consideration of €275,000. The transfer of shares was affected on 9 December 2020, at which date MaltaPost also acquired de-facto control in view of its representation on the board of directors.

Details of the purchase consideration are as follows:

	€'000
Fair value of 49% equity holding in Postalnsure as at acquisition date	275

Non-controlling interests have been measured at the related proportion of the net identifiable assets at acquisition.

In the twelve-month period to 30 September 2021, Postalnsure contributed revenue of €398,000 and loss of €2,000.

Postalnsure is principally engaged in providing general insurance services, a service offering that is ancillary to services currently provided by MaltaPost. This acquisition is expected to give rise to synergies within the Group.

Payments for acquisition of subsidiaries, net of cash acquired

The amounts presented in the statement of cash flows comprise the payments referred to above of €275,000, net of cash and cash equivalents attributable to the operations taken over at acquisition date.

7. Investment in subsidiaries - continued

Non-controlling interests (NCI)

Set out below is summarised financial information for the subsidiary that has non-controlling interest. The amounts disclosed are before inter-company eliminations.

Summarised balance sheet	PostaInsure
	2021 €'000
Current assets Current liabilities	1,425 (870)
Current net assets	555
Net assets	662
Accumulated NCI	387

Summarised statement of comprehensive income

	Period from
	1 October 2020
	to 30 September
	2021
	€.000
Revenue	311
Loss for the period	2
Profit allocated to NCI

Summarised cash flows
Cash flows from operating activities	49
Net increase in cash and cash equivalents	49

8. Investment in associate

	Group		Company
	2021	2020	20729	2020
	€ 000	€ 000	€ 000	€ 000
Year ended 30 September
Opening carrying amount	248		399
Additions	1.476	399	1,476	399
Share of results	(217)	(151)
Closing carrying amount	1,507	248	1,875	399
At 30 September
Cost	1.875	399	1,875	399
Share of results	(368)	(151)	1
Carrying amount	1.507	248	1,875	399

The associate at 30 September 2021 and 2020 is shown below:

Associate	Registered office	Percentage of shares and voting rights held	Nature of business
IVALIFE Insurance Limited	Gaba Buildings Level 2, Naxxar Road İklin İKL 9026 Malta	25% of ordinary shares	Insurance

Further investment in IVALife

During the year ended 30 September 2021, the Company further invested €1,500,000 in its associate IVALIFE Insurance Limited (IVALIFE). The 25% stake giving rise to an equivalent shareholding in this entity was acquired for a total amount of €1,875,000.

The associate has capital and reserves as at 30 September 2021 amounting to €6,029,000 (2020: €897,735) and registered a loss for the year amounting to €861,000 (2020: €602,265).

9. Financial assets at fair value through other comprehensive income

Financial instruments, other than loans and receivables, are summarised in the table below:

	Group and Company
	20729 € 000	2020 € 000
Financial assets at fair value through other comprehensive income: Non-current	2,900	3,561
Year ended 30 September Opening carrying amount Disposals/redemptions Net fair value movements (Note 16) Amortisation	3,561 (601) (58) (2)	3,925 (231) (131) (2)
Closing carrying amount	2,900	3,561
At 30 September Amortised cost Accumulated fair value gains	2,506 304	3,109 452
Carrying amount	2,900	3,561

Financial assets at fair value through other comprehensive income consist of debt securities listed on the Malta Stock Exchange. These debt securities are subject to fixed interest rates ranging from 3% to 6% (2020: 3% to 6%). The weighted average effective interest rate as at 30 September 2021 was 4% (2020: 4%). For investments traded on the Malta Stock Exchange, fair value is determined by reference to quoted market prices.

10. Deferred tax assets and liabilities

Deferred taxes are calculated on all temporary differences under the liability method and are measured at the tax rates that are expected to apply to the period when the asset is realised or the liability is settled based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period. The principal tax rate used is 35% (2020: 35%), with the exception of deferred taxation on the fair valuation of non-depreciable property, which is computed on the basis applicable to disposals of immovable property i.e. tax effect of 8% of the transfer value, amounting to €1,299,000 as at 30 September 2021 (2020: €1,028,000).

10. Deferred tax assets and liabilities - continued

The balance at 30 September represents temporary differences attributable to:

		Group		Company
	2022	2020	2022	2020
	€ 000	€ 000	€ 000	COOO
Assets
Reflected within profit or loss
Depreciation of property, plant and equipment	40	95	40	95
Provisions	36	36	36	36
Reflected within other comprehensive income
Provision for liabilities and charges	317	317	317 .	317
Reflected upon acquisition of subsidiary
Depreciation of property, plant and equipment	42
Provisions	60
	495	448	393	448
Liabilities
Reflected within other comprehensive income
Fair valuation of land and buildings	(1,299)	(1,028)	(1,299)	(1,028)
	(1,299)	(1,028)	(1,299)	(1,028)

The movement in the deferred tax assets and liabilities during the year is as follows:

	Group		Company
	20221 € 000	2020 € 000	2012 € 000	2020 € 000
Assets
At beginning of year	448	543	443	543
Charge to profit or loss (Note 25) Charge to other comprehensive	(55)	(49)	(55)	(49)
income (Note 16)		(46)		(46)
Reflected upon acquisition of subsidiary	102
At end of year	495	448	393	448
Liabilities
At beginning of year Charge to other comprehensive	(1,028)	(1,028)	(1,028)	(1,028)
income (Note 16)	(271)		(279)
At end of year	(1,299)	(1,028)	(1,299)	(1,028)
Net deferred tax liability	(804)	(580)	(805)	(580)

The recognised deferred tax assets and liabilities are expected to be recovered or settled principally after more than twelve months from the end of the reporting period. The deferred tax liabilities and assets reflected in other comprehensive income relate to temporary differences attributable to fair valuation of land and buildings within property, plant and equipment (Note 16) and to provision for actuarial losses in respect of pension obligations (Note 18) respectively.

11. Inventories

		Group and Company
	2021 €'000	2020 €,000
Inventories for resale	250	266
Other inventory items	238	282
Stamps and postal stationery	162	171
	700	719

There were no inventory write-downs during the current and preceding financial years.

12. Trade and other receivables

	Group		Company
	20921 € 000	2020 €'000	2021 € 000	2020 € 000
Current
Trade receivables - gross Receivables arising on insurance	4,934	3,579	4,934	3,579
transactions	333
Provisions for expected credit loss	(278)	(104)	(106)	(104)
Trade receivables - net	5,044	3,475	4,828	3.475
Amounts due from parent undertaking	89	36	89	36
Amounts due from subsidiary undertakings			61
Amounts due from related undertakings	1,206	1,232	1,176	1,232
Contract assets	3,018	3,066	3,018	3.066
Prepayments and accrued income	624	601	5:372	601
	9,981	8,410	9,754	8.410

Amounts due from group and from related undertakings are interest free, unsecured and repayable on demand. The Group's exposures to credit and currency risks together with impairment losses relating to trade and other receivables are disclosed in Note 2.

13. Deposits with financial institutions

	Group and Company
2021	2020 €'000

6,200	5,600
	€ 000

Deposits with financial institutions comprise placements with a maturity of more than three months but less than one year.

14. Cash and cash equivalents

For the purposes of the statement of cash flows, cash and cash equivalents comprise the following:

	Group		Company
	2021 € 000	2020 € 000	2021 € 0000	2020 € 000
Cash and balances with banks Business of insurance accounts	4,943 448	6,058	4,206	6.072
	5,391	6,058	4,206	6,072

Cash and cash equivalents as at 30 September 2021 include amounts collected on behalf of third parties, amounting to €960,000 (2020: €734,000) as disclosed in Note 19.

The use of the business of insurance accounts is restricted in terms of Chapter 8 of the Insurance Distribution Rules, 2019.

15. Share capital

		Company
	2021 E 000	2020 €'000
Authorised 56,000,000 ordinary shares of €0.25 each	14.000	14.000
Issued and fully paid up 37,654,720 ordinary shares of €0.25 each	9,414	9.414

Utilisation of the share premium account is governed by the requirements of Article 114 within the Companies Act (Cap. 386) of the laws of Malta.

MALTAPOST p.l.c. Annual Financial Report and Consolidated Financial Statements - 30 September 2021

16. Other reserves

Group and Company	Notes	Property revaluation reserve € 000	Investment fair value reserve € 000	Other reserve € 000	Total €0000
At 1 October 2019		2,712	583	(665)	2,630
Financial assets at fair value through other comprehensive income: Gains from changes in fair value	9		(131)		(131)
Remeasurements of defined benefit obligations:
Actuarial losses	18			133	133
Deferred taxes	10			(46)	(46)
At 30 September 2020		2,712	452	(578)	2,586
At 1 October 2020		2,712	452	(578)	2,586
Surplus arising on revaluation of land and buildings Deferred tax liability on revalued land and buildings determined on the	ปี	1,641			1,641
basis applicable to property disposals	10	(271)			(271)
Financial assets at fair value through other comprehensive income:
Losses from changes in fair value	9		(58)		(58)
At 30 September 2021		4,082	394	(578)	3,898

Property revaluation reserve

The revaluation reserve relates to fair valuation of the land and buildings component of property, plant and equipment, and the balance represents the cumulative net increase in fair value of such property, net of related deferred tax.

Fair value through other comprehensive income revaluation reserve

The fair value reserve represents changes in fair value of financial assets measured at fair value through other comprehensive income which are unrealised at financial reporting date. U on dis vosal, realised fair value gains are reclassified to profit or loss as a reclassification adjustment.

Other reserve

The other reserve reflects the impact of actuarial gains and losses with respect to pension obligations (Note 18) recognised in other comprehensive income in accordance with the Group's accounting policy, net of any related deferred tax impacts.

17. Lease liabilities

The lease liabilities associated with the recognised right-of-use assets are analysed below:

	Group and Company
	2021	2020
	€ 000	€'000
Non-current
Properties	1,138	1,349
Motor vehicles	152	200
Total non-current lease liabilities	1,290	1,549
Current
Properties	227	208
Motor vehicles	45	57
Total current lease liabilities	272	265
Total lease liabilities	1,562	1,814

Most extension options in property and motor vehicle leases have been included in the lease liability as the lease term reflects the exercise of such options.

The total cash outflows for leases in 2021 was €331,000 (2020: €328,000).

Included in lease liabilities for properties are amounts of €559,000 (2020: €571,000) which are attributable to arrangements with related parties.

The movement in the carrying amount of these assets is analysed in the following table:

	Group and Company
	2022	2020
	e 000	€ 000
At beginning of year	1,814	2,080
Impact of reassessment	25
Payments	(331)	(328)
Interest charge	54	62
At end of year	1,562	1,814

18. Provision for liabilities and charges

The amount recognised in the statement of financial position is as follows:

	Group and Company
	2021 € 000	2020 €'000
Present value of unfunded obligation Crystallised obligation Fair value of obligation to be reimbursed by Government	3.988 (1,611) (699)	3,873 (1,446) (699)
Provision reflected in financial statements	1,678	1,728

The provision is analysed in the statement of financial position as follows:

		Group and Company
	2021	2020
	€'000	€'000
Non-current	1,539	1,586
Current	139	142
	1,678	1,728

The movement for the year is made up of:

	Group and Company
	2021 3 000	2020 €,000
Charge to profit or loss Credit to other comprehensive income (Note 16) Crystallised obligation	(115)	(35) 133
	165	183
	50	281

18. Provision for liabilities and charges - continued

The amount recognised in other comprehensive income is as follows:

	Group and Company
Net actuarial gains	2072 € 000	2020 €000
- attributable to financial assumptions		133

Crystallised obligations relate to amounts which became payable as at the end of the reporting period. In computing the provision, the Group used a weighted average discount rate of 1.46% (2020: 1.41%). Assumptions regarding future mortality experience are based on published mortality tables in Malta, which translate into an average life expectancy of 83 (83 in 2020) depending on age and gender of the beneficiaries.

These factors are deemed to be the key assumptions used in the computation of the liability. The sensitivity of the obligation to changes in the key assumptions is considered immaterial for disclosure purposes.

Trade and other payables 19.

	Group		Company
	2021	2020	2021	2020
	€ 000	e ooo	€ 000	C 000
Current
Trade payables	7,763	5,698	7,683	5,635
Payables arising on insurance
Transactions	180
Amounts due to principals	527
Amounts owed to subsidiary undertakings			37	101
Amounts collected on behalf of third
parties (Note 14)	960	734	080	734
Amounts owed to related undertakings	1,664	1,507	1,640	1,507
Other payables	43	18	43	18
Indirect taxes and social security	3,147	1,271	3,058	1,246
Contract liabilities	130	221	180	221
Accruals and deferred income	3,599	4,514	3,518	4,553
	18,063	13,963	17,119	14.015

Amounts owed to subsidiary and to related undertakings are interest free, unsecured and repayable on demand.

The Group's exposures to currency and liquidity risks relating to trade and other payables are disclosed in Note 2.

20. Revenue

Revenue is analysed as follows:

	Group		Company
	2022	2020	2022	2020
	€ 000	e 000	€ 000	€ 000
By activity
Postal	32,889	29,594	32,889	29,594
Philatelic	364	242	364	242
Insurance commission	398
Other	4,275	4,251	4,275	4,251
	37,926	34,087	37,528	34,087
By geographical segments
Local	17,661	17,562	17,263	17,562
International cross-border	20,265	16,525	20,265	16,525
	37,926	34.087	37,528	34.087

The Group primarily operates in one segment that comprises the provision of postal and related retail services to customers, which activities are substantially subject to the same risks and returns. Accordingly, the presentation of segment information as required by IFRS 8, Operating segments, within these financial statements is not deemed applicable.

21. Expenses by nature

	Group		Company
	2021 e 000	2020 € 000	2022 E 000	2020 € 000
Employee benefits expense (Note 22) Depreciation and amortisation	16,165	15,171	16,012	15,171
(Notes 4, 5, 6)	1,802	1.496	1,783	1,496
Foreign direct mail costs	11,268	8,901	11,268	8,901
Property operating lease rentals	62	46	62	46
Motor vehicle operating lease and rental
costs	546	526	546	526
Other expenses	5.975	5,583	5.734	5,602
	35,818	31,723	35,405	31,742

21. Expenses by nature - continued

Fees for work carried out by the external auditor were as follows:

	Group		Company
	2021 € 000	2020 €000	2021 € 000	2020 €000
Annual statutory audit Other assurance services	60 18	29	38	26
Tax advisory and compliance services	2	16 5	18 2	16 ব
Other non-assurance services	43	2	23	2
	123	52	81-	48

Other non-assurance services to the Company include advisory services related to the insurance license application and cyber-security testing.

22. Employee benefits expense

	Group		Company
	2021	2020	2012-	2020
	3000	€ 000	€ 000	€000
Wages and salaries	14.607	13,647	14.059	13.155
Other staff costs	37/7/	387	7:34	925
Social security and indirect tax	1.181	1,137	1.169	1.091
	16,165	15,171	16,012	15,171

Average number of persons employed during the year:

		Group		Company
	2021	2020	20929	2020
Operational Management	744 61	663 57	684 60	619 57
	805	720	744	676

23. Other income

	Group and Company
	2021 €'000	2020 €'000
COVID-19 related grants	246	426
Other grants	128	54
	374	480

The COVID-19 related grants represented funds received by the Company to provide employees with a minimum wage cover to address the disruption caused by the pandemic.

24. Finance income

	Group and Company
	2021 € 000	2020 € 000
Interest income from bank balances and debt securities	139	149

25. Tax expense

	Group		Company
	2021	2020	2021	2020
	€ 000	€ 000	(2000	€ 000
Current tax expense	396	968	895	961
Deferred tax expense (Note 10)	55	49	55	49
Tax expense	051	1,017	050	1,010

The tax on profit before tax differs from the theoretical amount that would arise using the basic tax rate as follows:

	Group		Company
	20229 E 000	2020 € 000	2022 € 000	2020 € 000
Profit before tax	2,3550	2,780	2,582	2,912
Tax at 35% Tax effect of:	823	973	903	1,019
Income taxed at different rates	(30)	(36)	(30)	(36)
Impact of share of results of associate	76	53
Other differences	82	27	77	27
Tax expense	951	1,017	950	1,010

26. Directors' emoluments

		Group and Company
	2021 €'000	2020 €'000
Directors' fees	60	60

The Company paid insurance premia of €9,800 (2020: €6,205) during the year, in respect of professional indemnity.

27. Earnings per share

Earnings per share is based on the profit for the year attributable to the equity holders of MaltaPost p.l.c. divided by the weighted average number of ordinary shares in issue and ranking for dividend during the year.

	Group
	2021	2020
Profit attributable to equity holders (€'000)	1,399	1,763
Weighted average number of ordinary shares in issue (thousands)	37,655	37,655
Earnings per share (basic and diluted)	€0.04	€0.05

The Company has no instruments or arrangements which give rise to potential ordinary shares and accordingly diluted earnings per share is equivalent to basic earnings per share.

28. Dividends

	Company
	2021 €'000	2020 €'000
Dividends declared on ordinary shares	1,506	1.506
€ per share (net)	€0.04	€0.04

At the forthcoming Annual General Meeting, a final net dividend of €0.04 in respect of the financial year ended 30 September 2021 is to be proposed. These financial statements do not reflect this final dividend of €1,506,189 which, subject to approval by the shareholders at the forthcoming Annual General Meeting, will be accounted for in shareholders' equity as an appropriation of retained earnings in the year ending 30 September 2022.

29. Commitments

Operating lease commitments

The Group leases various premises and other assets under operating leases. The future minimum lease payments under non-cancellable operating leases, with a remaining lease term of less than 12 months amounted to €608,000 (2020: €572,000).

Specific lease arrangements include an option to renew the lease after the original term but the amounts presented in the table above do not reflect lease charges applicable to the renewal period.

The Company is also committed to pay an annual licence fee of 1.50% of its total gross revenue from postal services within the scope of the universal services.

Capital commitments

	Group		Company
	2022 € 000	2020 €'000	207291 € 000	2020 €'000
Authorised and contracted for: Property, plant and equipment	543	260	527	260
Investment in associate		1,500		1.500

30. Contingencies

As a result of its operations and activities in the ordinary course of business, the Group has, as at 30 September 2021, contingent liabilities arising from guarantees in favour of third parties and from performance bonds amounting to €165,000 (2020: €131,000).

31. Related party transactions

The following entities are considered to be related parties of the Company:

· Tanseana Limited (MaltaPost p.l.c.'s wholly-owned subsidiary)
· Redbox Limited (direct parent company)
· Lombard Bank Malta p.l.c. (indirect parent company)
· National Development and Social Fund
all entities controlled by the above

Lombard Bank Malta p.l.c. (via its wholly-owned subsidiary Redbox Limited) holds 71.5% Shareholding in MaltaPost p.l.c. In turn, the National Development and Social Fund (NDSF) holds 49.01% shareholding in Lombard Bank Malta p.l.c. Consequently, Government of Malta and other government entities are considered to be parties related to MaltaPost p.l.c. Nevertheless, in its Company Announcement dated 10 August 2018, Lombard Bank Malta p.l.c., reported that:

Quote

The NDSF had reaffirmed that:

· it does not intend to increase its holdings in the Bank;
· it shall not act in concert with any other shareholders;
· it will seek to reduce its shareholding in the Bank in an orderly manner, at the right market conditions and by agreement with the regulatory authorities;
· it has no intention of exerting any influence on the operations of the Bank; and
· this acquisition will not result in a change in control of the Bank.

Unquote

The sale of stamps to entities referred to above is made directly by the Company in the normal course of business at arm's length prices and is included within revenue. Disclosure of these amounts, which are not material, is not deemed necessary for the purpose of understanding the Company's financial results or its financial position.

In addition, the following transactions were carried out by the Company with related parties:

Company
2021	2020
€ 000	€ 000
458	2 537
2029	2020
€ 000	€000
222	211
292	382
7,390	6,361
1,421	433
304	304
	Group and Company

31. Related party transactions - continued

Year end balances with related parties arising from the above transactions are disclosed in Notes 12 and 19 to these financial statements. Included in 'Amounts collected on behalf of third parties' within 'Trade and other payables' are amounts that the Company processes on behalf of government entities which result in revenue, amounting to €822,000 (2020: €567,000).

Financial assets at fair value through other comprehensive income include:

	Group		Company
	20221 E 000	2020 € 000	2021 E 000	2020 €'000
Related party
Malta Government debt securities	1,679	2.100	1,679	2,100
Cash and cash equivalents include:
	Group		Company
	2021 E 000	2020 € 000	2021 E 000	2020 € 000
Indirect parent Term placements and bank balances held
with Lombard Bank Malta p.I.c.	508	8.023	448	8,018

Key management personnel comprise the Directors of the Company. Total fees and emoluments paid to the Directors have been disclosed in Note 26.

32. Statutory information

MaltaPost p.l.c. is a limited liability company and is incorporated in Malta.

Five year summary

Accounting ratios

	01 / 10/20	01/10/19	01/10/18	01/10/17	01/10/16
	to	to	to	to	to
	30/09/21	30/09/20	30/09/19	30/09/18	30/09/17
	%	%	%	%	%
Gross profit margin	18.32	21.64	21.04	17.90	18.13
Operating profit margin	6.65	8.29	8.03	6.12	7.56
Operating profit to total assets	4.88	6.07	6.43	5.14	6.98
Operating profit to capital employed	8.69	10.35	10.30	9.32	12.30
Profit before tax to total equity	8.99	10.67	11.01	9.94	12.91
Profit after tax to total equity	5.68	6.98	7.21	6.51	8.51
	30/09/24	30/09/20	30/09/19	30/09/18	30/09/17
Shares in issue of €0.25 each ('000s)	37,655	37,655	37,655	37,655	37,655
Net assets per share (€ cents)	76	72	72	70	63
Earnings per share (€ cents)	4	5	5	5	5

Financial highlights in major currencies

	Company
	USD	GBP
	000's	000's
For the year ended 30 September 2021
Revenue	43.453	32,294
Gross profit	7,959	5,915
Operating profit	2,891	2,149
Profit before tax	2,990	2,222
Net profit after tax	1,890	1,405
At 30 September 2021
Total assets less current liabilities	38,045	28,274
Total equity	33,265	24,722
Per share
Earnings	0.00050	0.000373
Net asset value	0.88	0.66

At currency rates of exchange ruling on 30 September 2021:

USD 1.16 = EUR 1 GBP 0.86 = EUR 1

Supplementary information

MaltaPost p.l.c. Post Offices

HEAD OFFICE - MARSA 305, Qormi Road, Marsa, MTP 1001

ATTARD 1, John Paul II Square, Attard, ATD 2200

BIRKIRKARA 58, Valley Road, Birkirkara, BKR 9013

BIRŽEBBUGA 48, Žarenu Dalli Street, Birżebbuga, BBG 1522

BORMLA Block 14, Fug San Pawl, Bormla, BML 1910

FGURA 419. Zabbar Road. Fgura, FGR 1018

FLORIANA 15A, San Kalčidonju Square, Floriana, FRN 1533

GHAJNSIELEM J. F. De Chambrai Street. Ghajnsielem, GSM 1051

GHARB Visitation Street, Gharb, GRB 1044

GZIRA 21, Meme' Scicluna Square, Gzira, GZR 1120

HAMRUN 18, Old Railway Street, Hamrun, HMR 1900

KALKARA SmartCity Malta, Building SCM 01 Level G, Ricasoli, Kalkara, SCM 1001

LIJA 2, Mikielang Borg Street, Lija, LJA 1440

LUQA 11, Dun Gulju Muscat Street, Luqa, LQA 1450

Malta International Airport, M.I.A. Hall, Luqa, LQA 5001

MARSASKALA St Anthony Street, Marsaskala, MSK 9059

MELLIERA 100, New Mill Street, Mellieha, MLH 1107

MOSTA Civic Centre, Constitution Street, Mosta, MST 9059

MSIDA University Campus, Msida, MSD 2080

NADUR 13, North Street, Nadur, NDR 1220

NAXXAR Civic Centre, 21st September Avenue, Naxxar, NXR 1018

PAOLA Civic Centre, Antoine de Paule Square, Paola, PLA 1266

PIETA' Gwardamanga Hill, Pieta', PTA 1310

QORMI 343, Victory Street, Qormi, QRM 2504

RABAT Civic Centre, St. Rita Street. Rabat, RBT 1001

SAN GILJAN Paceville Street, Paceville, San Giljan, STJ 3103

SAN GWANN 95, Naxxar Road, San Gwann, SGN 9031

SAN PAWL IL-BAHAR 6. Dolmen Street. Bugibba, San Pawl il-Bahar, SPB 2400

St Paul Street. San Pawl il-Bañar , SPB 3416 SLIEMA 42. Rudolph Street. Sliema, SLM 1275

39, Sir Adrian Dingli Street, Sliema, SLM 1902

SWIEQI Civic Centre, G. Bessiera Street, Swieqi, SWQ 2261

VALLETTA 1, Dar Annona, Castille Square, Valletta, VLT 1060

75, Old Bakery Street, Vailetta, VLT 1458

Malta Postal Museum, 135, Archbishop Street, Valletta, VLT 1444

25, South Street, Valletta, VLT 1102

VICTORIA 5, Sir Adrian Dingli Street, Victoria, VCT 1441

XAGHRA 132. Race Course Street. Xagħra, XRA 2013

ŻABBAR Civic Centre, Convent Street, Žabbar, ZBR 1351

ŽEBBUG

Sciortino Street, Żebbug, ZBG 1962

ŻEJTUN 37. St Lucian Street. Zejtun, ZTN 1834

ZURRIEQ 75, Main Street, Žurrieq, ZRQ 1317

MALTAPOST p.l.c. Annual Financial Report and Consolidated Financial Statements - 30 September 2021

MaltaPost p.l.c. Sub-Post Offices BAHAR IC-CAGHAQ Allstat Stationery, Lampara Street, Bahar ic-Caghaq, NXR 5134

BIRGU Step In, Victory Square, Birgu, BRG 1300

BIRKIRKARA 84, Landau Stationery, Dun Gejtanu Mannarinu Street, Birkirkara, BKR 9085

D Spiral Stationery, Victory Street, Birkirkara, BKR 2691

DINGI I Ghajn Stationery Main Street, Dingli, DGL 1837

GHARGHUR Aquavel, St Bartholomew Street, Gharghur, GHR 1014

GHASRI Kunsill Lokali Ghasri, 6, Dun Karm Caruana Street, Ghasri, GSR 1021

GHAXAQ 4, Marchams, Wesgña Bir id-Deheb, Ghaxaq, GXQ 1651

KALKARA 68, Troy DVD Rentals, Archbishop Gonzi Square, Kalkara, KKR 1510

KERČEM Kercem Local Council, Orvieto Square, Kercem, KCM 1360

MARSASKALA Needz Stationery, Vajrita Street, Marsakala, MSK 3325

MELLIEHA 51, G. Borg Olivier Street, Mellieña, MLH 1024

МОАВВА 12, Alessio's Old Cottage, Parish Street, Mqabba, MQB 1511

MSIDA Wigwam, Tal- Qroqq Street, Msida, MSD 1702

NAXXAR Zaky's, St Publius Street, San Pawl tat-Targa, NXR 1490

QORMI Electroit Stationery, Federico Maemple Square, Qormi, QRM 1011

QRENDI Papel Stationery, Saviour Street, Qrendi, QRD 1701

SAN GILJAN Papier, Level 0, Spinola Park, Mikielang Borg Street San Giljan, SPK 1000

SAN GWANN 6, S.G.S., Felic Borg Street, San Gwann, SGN 2040

SAN LAWRENZ 22A, San Lawrenz Local Council, Our lady of Sorrows Street, San Lawrenz, SLZ 1261

SANTA LUČIJA Willand Bargain Store, Dun M. Mifsud Street, Santa Lucija, SLC 1441 SANTA VENERA C@C, Fleur-De-Lys Junction, Santa Venera, SVR 1580

SIGGIEWI Many Things Stationery, Old Church Street, Siggiewi, SGW 1704

TARXIEN 16/17, Forex, Market Square, Tarxien, TXN 1951

ZURRIEQ Pinpoint Stationery, 57, Independence Avenue, Zurrieq, ZRQ 2339

Collection of postal articles from public letterboxes is held as follows (exceptions may apply as announced to the public in agreement with the Malta Communications Authority).

Monday Friday 17:15 hrs
Saturday 12:30 hrs

Delivery of postal articles generally commences as from 07:00 hrs and ends in accordance with operational exigencies.

Further information on our products and services, including prices and a full list of letterboxes and stamp vendors, may be found on our website on www.maltapost.com or by request from our Post Offices or from our Customer Care Department on (+356) 21224421.

The postal schemes which deal with a number of postal services may also be located and downloaded from our website or available upon request from our Post Offices or our Customer Care. During the year under review, Customer complaints accounted for 0.002% of all mail items handled.

AI Terminal

MaltaPost Plc

2056_rns_2021-12-20_0f63e35a-440a-429f-9e4e-d6d421b03217.pdf

COMPANY ANNOUNCEMENT

QUOTE

Chairman's statement to the members

Chairman's statement to the members - continued

Chief Executive Officer's review of operations

REVIEW OF FINANCIAL PERFORMANCE

OPERATIONAL PERFORMANCE

Chief Executive Officer's review of operations - continued

NEW PROJECTS AND INTIATIVES

CORPORATE SOCIAL RESPONSIBILITY

OUTLOOK

Chief Executive Officer's review of operations - continued

Directors' report

PRINCIPAL ACTIVITIES

REVIEW OF PERFORMANCE

Remuneration policy

Social and employee matters

OUR PRINCIPAL RISKS AND UNCERTAINTIES

Traditional mail evolution

Intensifying competition in international business

Inability to maintain staff resourcing in line with business needs

Legislative and/or regulatory repercussions

Financial risk management

RESULTS AND DIVIDENDS

CAPITAL

BOARD OF DIRECTORS, OFFICERS AND SENIOR MANAGEMENT

DIRECTORS' STATEMENT OF RESPONSIBILITIES IN RELATION TO THE FINANCIAL STATEMENTS

STATEMENT OF THE DIRECTORS PURSUANT TO CAPITAL MARKETS RULE 5.68

INFORMATION PROVIDED IN ACCORDANCE WITH CAPITAL MARKETS RULE 5.70.1

GOING CONCERN BASIS

CAPITAL MARKETS RULES DISCLOSURES

NON-FINANCIAL INFORMATION

OTHER INFORMATION

COVID-19 PANDEMIC

AUDITORS

A. COMPLIANCE WITH THE CODE

PRINCIPLE 1: THE BOARD

PRINCIPLE 2: CHAIRMAN AND CHIEF EXECUTIVE OFFICER

PRINCIPLE 4: RESPONSIBILITIES OF THE BOARD

PRINCIPLE 5: BOARD MEETINGS

PRINCIPLE 6: INFORMATION AND PROFESSIONAL DEVELOPMENT

PRINCIPLE 7: EVALUATION OF BOARD'S PERFORMANCE

PRINCIPLE 8: COMMITTEES

AUDIT AND RISK COMMITTEE

ASSETS AND LIABILITIES COMMITTEE

REMUNERATION COMMITTEE

PRINCIPLE 11: CONFLICTS OF INTEREST

PRINCIPLE 4: RESPONSIBILITIES OF THE BOARD

PRINCIPLE 8: NOMINATION COMMITTEE

PRINCIPLE 9: RELATIONS WITH SHAREHOLDERS AND WITH THE MARKET

C. INTERNAL CONTROL (CAPITAL MARKETS RULE 5.97.4)

Remuneration report

MEMBERSHIP AND TERMS OF REFERENCE

MEETINGS

REMUNERATION - DIRECTORS

Remuneration report - continued

REMUNERATION - SENIOR EXECUTIVES

Company information

Vision Statement

Mission Statement

Company information - continued

BOARD OF DIRECTORS

COMPANY SECRETARY

CHIEF OFFICERS

CONSULTANT RETAIL OPERATIONS Ray Briffa

HEADS OF DEPARTMENTS

Independent auditor's report

Report on the audit of the financial statements

Our opinion

What we have audited

Basis for opinion

Independence

Our audit approach

Overview

Materiality

Key audit matters

Key audit matter