Agria Group Holding AD

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AGRIA GROUP HOLDING AD CONSOLIDATED FINANCIAL STATEMENTS ANNUALL CONSOLIDATED REPORT December 31, 2022 AGRIA GROUP HOLDING AD Consolidated financial statements December 31, 2022 2 CONTENTS: CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2022.............. 3 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS........................8 ANNUAL CONSOLIDATED REPORT..................................................................44 ADDITIONAL INFORMATION UNDER SUPPLEMENT No 3 TO ART. 10..........................................................................97 CONSOLIDATED DECLARATION ON CORPORATE GOVERNANCE.............99 CONSOLIDATED REPORT OF THE BOARD OF DIRECTORS OF AGRIA GROUP HOLDING AD ON THE APPLICATION OF THE REMUNERATION POLICY...................................................................................................................110 DECLARATION UNDER ART. 100n (4), ITEM 4 OF POSA................................118 AGRIA GROUP HOLDING AD Consolidated financial statements December 31, 2022 3 CONSOLIDATED FINACIAL STAEMENTS AS AT DECEMBER 31, 2022 AGRIA GROUP HOLDING AD _____________ Notes 31.12.2022 31.12.2021 No BGN'000 BGN'000 ASSETS Non-current assets Property, plant and equipment 4 259 712 189 766 Intangible assets 5 111 128 Non-current investments 6 10 634 512 Non-current receivables 7 2 097 2 097 Goodwill 8 2 326 - Other non-current assets 274 880 192 503 Current assets Inventories 9 108 645 118 742 Accounts receivable and loans granted 10 110 024 127 471 Cash and cash equivalents 11 4 548 1 852 Total current assets 223 217 248 065 Total assets 498 097 440 568 EQUITY AND LIABILITIES Equity Share capital 12 6 800 6 800 Own shares buy-back (1 390) - Reserves 13 108 073 65 494 Retained earnings 171 687 105 489 Total 285 170 177 783 Minority interest - 519 Total equity 285 170 178 302 Non-current liabilities Interest bearing bank loans 14 34 954 38 104 Lease contracts obligations 15 15 944 12 067 Deferred tax liabilities, net 16 8 670 4 712 Trade loans 17 - 145 Other non-current liabilities 18 1 141 1 277 Total non-current liabilities 60 709 56 305 Current liabilities 19 152 218 205 961 Total liabilities 212 927 262 266 Total equity and liabilities 498 097 440 568 Emil Raykov Asya Yordanova (Executive Director) (Chief Accountant) Audit company Marian Nikolov Priomorska Audit Company OOD registered auditor, responsible for the audit Reg. N: 086 Reg. N: 0601 Iliya Iliev managing partner April 28, 2023 The accompanying notes are an integral part of these financial statements. CONSOLIDATED STATEMENT OF FINANCIAL POSITION as at December 31, 2022 ____________ Consolidated financial statements as of December 31, 2022 4 AGRIA GROUP HOLDING AD _______________ Notes Year Year ended ended 31.12.2022 31.12.2021 BGN'000 BGN'000 Income from sales 20 696 429 430 825 Income from grovernment grants 21 7 697 6 190 Other income 22 1 917 3 221 Carrying amount of goods sold 463 099 309 547 Materials expenses 23 108 535 61 458 Hired services 24 21 034 12 571 Personnel expenses 25 22 240 14 061 Depreciation and amortization 4,5 11 861 10 753 Other expenses 26 1 199 820 Impairment 27 6 760 2 146 Changes in inventories (7 436) (2 094) Total operating expenses 627 292 409 262 Financial income 28 3 291 1 201 Financial expenses 29 (5 320) (6 558) Profit before tax 76 722 25 617 Income tax expense 30 8 142 2 738 Profit for the period 68 580 22 879 Other components of comprehensive income: Components not to be reclassified in proft or loss: Profit from revaluation of property, plant and equipment 47 355 - Revaluation of retirement benefit obligations 86 (32) Income tax expense, concerning other components of the comprehensive income (4 744) 2 Other comprehensive income, net of tax 42 697 (30) Total comprehensive income for the period 111 277 22 849 Referring to: Owners of parent company 111 277 22 807 Minority interest - 42 111 277 22 849 Earnings per share (BGN) 31 10.09 3.36 Emil Raykov Asya Yordanova (Executive Director) (Chief Accountant) Audit company Marian Nikolov Priomorska Audit Company OOD registered auditor, responsible for the audit Reg. N: 086 Reg. N: 0601 Iliya Iliev managing partner April 28, 2023 The accompanying notes are an integral part of these financial statements. CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME for the year ended December 31, 2022 ________________ Consolidated financial statements as of December 31, 2022 5 AGRIA GROUP HOLDING AD _____________________ Attributable to the owners of the parent company Share Shares Legal Revaluation Revaluation of Premium Retained Total Minority Total capital buy-back Reserves reserve defined benefit obligations reserves earnings equity interest BGN'000 BGN'000 BGN'000 BGN'000 BGN'000 BGN'000 BGN'000 BGN'000 BGN'000 BGN'000 Balance at January 1, 2021 6 800 - 1 766 50 311 (11) 13 668 83 442 155 976 477 156 453 Profit for the period - - - - - - 22 837 22 837 42 22 879 Other comprehensive income for the period, net of tax - - - (30) - - (30) - (30) Total comprehensive income for the period - - - - (30) - 22 837 22 807 42 22 849 Revaluation reserve written off - - - (230) - - 230 - - - Increase of legal reserves - - 20 - - - (20) - - - Dividends dsitribution - - - - - - (1 000) (1 000) - (1 000) Balance at December 31, 2021 6 800 - 1 786 50 081 (41) 13 668 105 489 177 783 519 178 302 Profit for the period - - - - - - 68 580 68 580 - 68 580 Other comprehensive income for the period, net of tax - - - 42 620 77 - - 42 697 - 42 697 Total comprehensive income for the period - - - 42 620 77 - 68 580 111 277 - 111 277 Share buy-back - (1 390) (1 390) - (1 390) Revaluation reserve written off - - - (250) - - 250 - - - Increase of legal reserves - - 132 - - - (132) - - - Effect of acquiring a minority interest - - - - - - - (519) (519) Dividends dsitribution - - - - - - (2 500) (2 500) - (2 500) Balance at December 31, 2022 6 800 (1 390) 1 918 92 451 36 13 668 171 687 285 170 - 285 170 Emil Raykov Asya Yordanova (Executive Director) (Chief Accountant) Audit company Marian Nikolov Priomorska Audit Company OOD registered auditor, responsible for the audit Reg. N: 086 Reg. N: 0601 Iliya Iliev managing partner April 28, 2023 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY for the year ended December 31, 2022 __________________ Consolidated financial statements as of December 31, 2022 6 AGRIA GROUP HOLDING AD ______________ Year Year ended ended 31.12.2022 31.12.2021 BGN'000 BGN'000 Cash and cash equivalents at January 1 1 852 2 030 Cash flows from operating activities Proceeds from clients and other debtors 707 244 422 598 Payments to suppliers and other creditors (609 954) (439 332) Payments, related to personnel (21 030) (13 376) Paid / refunded other taxes (5 735) (1 852) Other payments (11) - Net cash flows from operating activities 70 514 (31 962) Cash flows from investing activities Purchase of property, plant and equipment (19 491) (6 219) Sale of property, plant and equipment 1 771 853 Transactions with financial derivative instruments, net 1 182 (2 541) Payments, related to investments (15 684) (2) Net cash flows from investing activities (32 222) (7 909) Cash flows from financing activities Interest bearing bank loans received, paid, net (33 566) 52 289 Trade loans granted and received, net 7 807 (1 862) Payments to lease contracts (5 423) (7 060) Payments related to share buy-back (1 390) - Interest paid (3 585) (2 698) Interest received 3 136 805 Dividends paid (2 538) (1 000) Bank taxes and comissions paid (761) (711) Net cash flows from financing activities (36 320) 39 763 Changes in cash and cash equivalents during the period 1 972 (108) Net effect of changes in exchange rates 724 (70) Cash and cash equivalents at period end 4 548 1 852 Emil Raykov Asya Yordanova (Executive Director) (Chief Accountant) Audit company Marian Nikolov Priomorska Audit Company OOD registered auditor, responsible for the audit Reg. N: 086 Reg. N: 0601 Iliya Iliev managing partner April 28, 2023 The accompanying notes are an integral part of these financial statements. CONSOLIDATED CASH FLOW STATEMENT for the year ended December 31, 2022 _____________ Consolidated financial statements as of December 31, 2022 7 AGRIA GROUP HOLDING AD Consolidated financial statements December 31, 2022 8 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS AT DECEMBER 31, 2022 AGRIA GROUP HOLDING AD Consolidated financial statements as of December 31, 2022 9 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2022 1. Incorporation and registration. Legal status and legal framework “AGRIA GROUP HOLDING” (the parent company) is registered under Company File 3875 / 2007 of Varna District Court, with a seat and management address in the town of Varna, 111 Kniyaz Boris I Blvd., Business centre, floor 9. The parent company is registered in the Commercial Register at the Registry Agency, UIC 148135254. As of 2007 the shares of the parent company are listed for trading at Bulgarian Stock Exchange AD and thus, it has the status of a public company. With a decision of 2007 of the Financial Supervision Commission of Bulgaria the Group was entered in the register of public companies. The main activity of the parent company and its subsidiaries, together called the Group, consists in the production, storage, processing and sale of agricultural products. The parent company has one-tier management system and is managed by a Board of Directors and is represented by an Executive Director. These financial statements were approved for issue by the management of the Group on April 28, 2023. 2. Basis of preparation of the consolidated financial statements and accounting principles. 2.1. Applicable general framework for financial statements The Group manages its current accounting and prepares its financial statements in compliance with the requirements of the Bulgarian commercial and accounting legislation. These consolidated financial statements have been prepared in accordance with International Accounting Standards (IAS), an edition of the International Accounting Standards Board and adopted by the European Union. As at December 31, 2022, IASs include International Accounting Standards, International Financial Reporting Standards (IFRSs), Interpretations of the Standing Interpretations Committee and Interpretations of the Interpretations Committee of IFRSs. IASs are reissued every year and are valid only for the year of issue and include all changes, as well as new standards and interpretations. Many of them are not applicable to the activities of the Group due to the specific issues addressed in them. 2.2. Initial application of new and amended IFRSs effective for the current reporting period The management of the Group has reviewed the changes in the existing accounting standards that came into force on January 1, 2022 and believes that they do not require significant changes in terms of the accounting policy applied in the current year. (a) Initial application of new amendments to existing standards effective during the current reporting period The Group has applied for the first time certain standards and amendments that are effective for annual periods beginning on or after 1 January 2022. The Group has not previously applied any standard, clarification or amendment that has been published but not yet entered into force. IFRS 3 Business Combinations; IAS 16 Property, plant and equipment; IAS 37 Provisions, Contingent Liabilities and Contingent Assets, as well as Annual Improvements 2018-2020 AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2022 (continued) Consolidated financial statements as of December 31, 2022 10 2. Basis of preparation of the consolidated financial statements and accounting principles (continued) 2.2. Initial application of new and amended IFRSs effective for the current reporting period (continued) The amendments are effective for annual periods beginning on or after January 1, 2022, with earlier adoption permitted. The IASB publishes narrow-scope amendments to IFRS as follows: IFRS 3 Business Combinations (Amendments) - updated the reference to the previous version of the IASB Conceptual Framework for Financial Reporting in IFRS 3 with a reference to its current version published in 2018, without significant changes to the accounting requirements for business combinations. These amendments have not had an impact on the Group's financial statements. IAS 16 Property, plant and equipment (Amendments) - prohibits enterprises from deducting from the cost of acquisition of property, plant and equipment any proceeds from the sale of items produced while that asset is brought to the place and condition necessary for to be able to function in the manner intended by the management. Instead, businesses recognize these sales revenues and related manufacturing costs in profit or loss. These amendments have not had an impact on the Group's financial statements. IAS 37 Provisions, Contingent Liabilities and Contingent Assets (Amendments) – mentions which costs the enterprise should include when determining the price for the performance of a given contract for the purposes of assessing whether the contract is onerous. The amendments clarify that costs that are directly related to a contract for the provision of goods or services include both intrinsic costs and allocation of costs directly related to contract activities. Annual improvements 2018-2020 - minor amendments are introduced to IFRS 1 First-time Application of International Financial Reporting Standards, IFRS 9 Financial Instruments, IAS 41 Agriculture and the illustrative examples included in IFRS 16 Leases. These amendments have not had an impact on the consolidated financial statements of the Group. IFRS 16 Leases - Lease discounts in the context of Covid 19 after 30 June 2021 (Amendment) The amendment is effective for annual reporting periods beginning on or after April 1, 2021, with earlier application permitted, including in financial statements that have not yet been approved for publication at the date the amendment is issued. In March 2021, the Board amended the terms of the practical expedient measure in IFRS 16, which provides relief for lessees in applying the guidance in IFRS 16 for modifications to leases for rent concessions that occur as a direct consequence of the Covid-19 pandemic. Following the amendment, the practical expedient now applies to rebates where any reduction in lease payments only affects payments that were originally due on or before 30 June 2022, provided that the remaining conditions for the practical expedient to apply are met . These amendments have not had an impact on the Group's financial statements. b) Published standards not yet in effect and not previously adopted The published new and amended standards and the clarifications to them, which are not yet in force by the date of issue of the consolidated financial statements of the Group, are disclosed below. The Group intends to apply these new and amended standards and interpretations provided they are applicable when they become effective. IFRS 17 Insruance contracts In May 2017, the IASB published IFRS 17 Insurance Contracts (IFRS 17), a comprehensive new accounting standard for insurance contracts covering recognition and measurement, presentation and disclosure. The standard is effective for annual periods beginning on or after 1 January 2023. Earlier application is permitted provided the entity also applies IFRS 9 on or before the date it first applies IFRS 17. It is a comprehensive new accounting standard for insurance contracts covering recognition and measurement, presentation and disclosure. IFRS 17 applies to all types of insurance contracts, as well as to certain guarantees and financial instruments representing investment contracts with discretionary participation. This standard is not applicable to the Group. AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2022 (continued) Consolidated financial statements as of December 31, 2022 11 2. Basis of preparation of the consolidated financial statements and accounting principles (continued) 2.2. Initial application of new and amended IFRSs effective for the current reporting period (continued) Amendments to IAS 1: Presentation of Financial Statements and Statement of Practice under IFRS 2: Disclosure of Accounting Policies In January 2021, the IASB published amendments to IAS 1 and Statement of Practice under IFRS 2 Making judgments about the level of materiality (PI), which provides guidance and examples to help entities apply judgments about the level of materiality when disclosing accounting information. policies. The amendments aim to assist businesses in providing accounting policy disclosures that are more useful by: • Replacing the requirement for companies to disclose their "mate rial" accounting policies with a requirement to disclose their "significant" accounting policies; and • Adding guidance on how entities should apply the materiality concept when making decisions about accounting policy disclosures. The amendments are effective for annual reporting periods beginning on or after 1 January 2023. Earlier application of the amendments to IAS 1 is permitted to the extent that this fact is disclosed. The Group will analyze and assess the effects of the new amendments on its financial position or results of operations. Amendments to IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors: Definition of Accounting Estimates In February 2021, the Council published amendments to IAS 8, introducing a new definition of "accounting estimates". The amendments clarify the difference between changes in accounting estimates and changes in accounting policies and correction of errors. They also clarify how entities use estimation techniques and input data to develop accounting estimates. The amended standard explains that the effects on a particular accounting estimate resulting from changes in input data or estimation techniques represent changes in accounting estimates if they do not lead to the correction of errors from a prior period. The Council retains the aspect of the definition of accounting estimates that changes in accounting estimates can result from new information or new developments. The amendments take effect for annual reporting periods beginning on or after January 1, 2023, with early adoption permitted. The company will analyze and evaluate the effects of the amendments on its financial position or results of operations. Amendments to IAS 12 Income taxes: Deferred tax related to assets and liabilities arising as a result of a transaction. In May 2021, the Council published amendments to IAS 12, which narrow the scope of permitted exceptions to initial recognition under IAS 12, so they are no longer applicable to transactions that give rise to equal taxable and tax-deductible temporary differences. The amendments clarify that when payments that settle a liability are recognized for tax purposes, it is a matter of judgment whether those tax deductions can be attributed to the recognized financial liability or the related asset. This judgment is important in determining whether there is a temporary difference in the initial recognition of the asset and liability. According to the amendments, exceptions to initial recognition are not applicable to transactions that, at initial recognition, give rise to equal taxable and tax-deductible temporary differences. They are only applicable if the recognition of a lease asset and lease liability (or a decommissioning liability and a component of the asset subject to decommissioning) gives rise to taxable and tax-deductible temporary differences that are not equal. AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2022 (continued) Consolidated financial statements as of December 31, 2022 12 2. Basis of preparation of the consolidated financial statements and accounting principles (continued) 2.2. Initial application of new and amended IFRSs effective for the current reporting period (continued) The amendments come into effect for annual reporting periods beginning on or after January 1, 2023. The entity must apply the amendments to transactions that occur on or after the beginning of the earliest comparative period presented. Additionally, at the beginning of the earliest comparative period presented, the entity must also recognize a deferred tax asset (provided sufficient taxable profit is available) and deferred tax liability for all deductible and taxable temporary differences related to leases and decommissioning obligations. The company will analyze and assess the effects of the amendments on its financial position or results of operations. Amendments to IAS 1 : Classification of liabilities to current and non-current In January 2020, the Bulgarian National Accounting Standards (NAS) published amendments to paragraphs 69 to 76 of NAS 1, which specifically address the requirements for classifying assets as current or non-current. The amendments clarify the following:  What is meant by a right to defer settlement  That there must be a right to rescheduling at the end of the accounting period  That the classification is not affected by the likelihood that the entity will exercise its deferral right  That only if an embedded derivative in a convertible liability is itself an equity instrument, the terms of the liability will not affect its classification. In July 2021, the Council adopted a preliminary decision to propose several amendments to the clarifications provided in January 2020. In particular, the Board decided to propose that if the right to defer settlement for a period of at least twelve months is subject to the entity's compliance with certain conditions after the reporting date, then those conditions do not affect whether the right to defer settlement exists at the reporting date for the purposes of classifying a liability as current or non-current. Additional filing and disclosure requirements will apply in such circumstances. The Council also took a preliminary decision to postpone the entry into force date to no earlier than 1 January 2024 (from 1 January 2023). The Group will analyze and assess the effects of the changes on the financial position or results of operations. Amendments to IFRS 16 Leases: Lease liabilities under lease back transactions In September 2022, the Bulgarian National Accounting Standards Board (NASB) published amendments to IFRS 16 Leases: Lease liability in sale and leaseback transactions. The amendments are intended to enhance the requirements that a seller-lessee uses to assess the lease liability arising from a sale and leaseback transaction under IFRS 16, without changing the accounting for leases that are not related to these transactions. Specifically, the seller-lessee determines the 'lease payments' or 'adjusted lease payments' in such a way as to not recognize any profit or loss related to the right of use that it retains. However, these requirements do not prevent the seller-lessee from recognizing any profit or loss related to the partial or full termination of the lease in the profit or loss. The seller-lessee applies the amendment retrospectively in accordance with IAS 8 for sale and leaseback transactions entered into after the date of initial application, which is the beginning of the annual reporting period in which the entity first applied IFRS 16. The amendments are effective for annual periods beginning on or after January 1, 2024, with earlier application permitted. The amendments have not yet been endorsed by the European Union. The Group will analyze and evaluate the effects of the amendments on its financial position or results of operations. AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2022 (continued) Consolidated financial statements as of December 31, 2022 13 2. Basis of preparation of the consolidated financial statements and accounting principles (continued) 2.2. Initial application of new and amended IFRSs effective for the current reporting period (continued) Amendments in IFRS 10 and IAS 28 – Sale or contribution of assets between and onvestor and its associate or joint venture In December 2015, the IASB decided to defer the effective date of the amendments to a future date by which it had finalized any amendments arising from the Council's project on the equity method of accounting. The amendments address the conflict between IFRS 10 Consolidated Financial Statements and IAS 28 Investments in Associates and Joint Ventures regarding the accounting for the loss of control of a subsidiary that is sold or contributed to an associate or joint venture. The changes clarify that the full amount of profit or loss is recognized when the transfer to the associated or joint venture includes a business as defined in IFRS 3. However, any profit or loss arising from the sale or contribution of assets that do not constitute a business is only recognized to the extent of the investors' non- controlling interests in the associated or joint venture. The changes have not yet been adopted by the EU. The company will analyze and assess the effects of the changes on its financial position or results of operations. 2.3. Accounting estimates and reasonable assumptions The application of IAS requires the group's management to make certain accounting estimates and reasonable assumptions in the preparation of these consolidated financial statements in order to determine the value of certain assets, liabilities, income and expenses. These estimates and assumptions are based on the best estimate of the management, considering historical experience and analysis of all factors influencing the circumstances at the date of preparation of the consolidated financial statements. The actual results could differ from those presented in these consolidated financial statements. 2.4. Consolidation The consolidated financial statements include the financial statements of the parent company and its subsidiaries as of December 31, 2022 represented as a whole. Subsidiaries are those entities in which the Group holds directly or indirectly more than 50% of the share capital or the management of the Group and thus has the power to exercise control. Where necessary, adjustments have been made in the accounting policies of the subsidiaries so that they are in accordance with the accounting policies of the Group. All material internal transactions and balances between companies of the Group have been eliminated and the financial statements have been prepared by applying the full consolidation method. The results of the subsidiaries are included in the consolidated financial statements from the date of acquisition of control over them and cease to be consolidated from the date on which control is lost. In cases where the owners of the Group have a direct participation in a subsidiary as individuals, their share in the net assets of the company is treated as part of the reserves of the Group, and their share in the financial result for the period is presented in the financial result to the Group. 2.5. Subsidiaries As of December 31, 2022 and 2021 the parent company has direct ownership interests in the following subsidiaries which are included in the consolidated financial statements: AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2022 (continued) Consolidated financial statements as of December 31, 2022 14 2. Basis of preparation of the consolidated financial statements and accounting principles (continued) 2.5. Subsidiaries (continued) company Share of capital % Share of capital % 31.12.2022 BGN’000 31.12.2021 BGN’000 Korn Trade EOOD 100% 100% AJ Property Invest EOOD (previous name Korn Security EOOD) 100% 100% Agro EOOD 100% 100% Aris Agor EOOD 100% 100% Bora Invest EOOD 100% 100% Bora energy EOOD 100% 100% Toni M EOOD 100% 100% Kristera agro EOOD 100% 100% Kristera AD 100 % 100 % Gruver EOOD 100 % 100 % Tera Protect EOOD 100 % 100 % BD Pharma EOOD 100 % 100 % BD Agri EOOD 100 % 100 % Company Share of capital % Share of capital % December 31, 2022 BGN’000 December 31, 2021 BGN’000 Diasvet EOOD 100 % 100 % Agra EAD 100 % 100 % Kehlibar EOOD 100 % 100 % Silk Gas BG EOOD 100 % 55 % AgriVia Oil EOOD 100 % - Kristera AD 99% 99% Korn Star OOD 70 % - In March 2022, a change in the ownership structure of the subsidiary company Silk Gas BG Ltd was registered in the Commercial Register of the Bulgarian Commercial Register Agency. According to the registered circumstances, on February 24, 2022, a share purchase agreement was concluded, under which Agria Group Holding AD acquired the remaining 225 shares of the capital of the company. Thus, Silk Gas BG Ltd became a sole proprietorship with limited liability, with Agria Group Holding AD as the sole owner of the capital. 2.6. Non-controlling interest Minority (non-controlling) interest is that portion of the net assets and the financial result for the period that is not owned directly or indirectly by the group. AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2022 (continued) Consolidated financial statements as of December 31, 2022 15 2. Basis of preparation of the consolidated financial statements and accounting principles (continued) 2.7. Business combinations. Company transformation According to the requirements of IFRS 3 Business Combinations, a business combination is a combination of individual companies or businesses into a single reporting entity. In the event that a company acquires control of another company that is not a separate business, the merger of these companies is not considered a business combination. Business combinations are accounted for using the purchase method in accordance with applicable standards. When in reporting periods after the acquisition of control of the subsidiary additional shares are purchased, the increase in investment is accounted for using the purchase method and the difference between the acquisition price and the share in the acquired identifiable assets, liabilities and contingent liabilities is recorded as goodwill, which is immediately reviewed for indicators of impairment. Where such indicators exist, the goodwill is impaired. Transformations of commercial entities which are carried out under the Bulgarian Commerce Act and relate to entities under common control are treated as restructuring within a business group. A merger of a company is not associated with cash and/or other payments and is presented in the statement of financial position of the receiving company or group at the historical cost of the identifiable assets, liabilities, and equity, which are consolidated line by line. Comparative data are restated as if the transformation is carried out at the beginning of the earliest comparative period. 2.8. Functional and presentation currency of the financial statements Functional currency is the currency of the primary economic environment in which the Group operates and in which cash is mainly generated and spent. It reflects the main transactions, events and conditions relevant to it. The Group keeps accounts and prepares its financial statements in the national currency of the Republic of Bulgaria - Bulgarian lev (BGN). This is the currency accepted as official in the main economic environment in which the Group operates. As of January 1, 1999, BGN has a fixed exchange rate against the EUR: BGN 1.95583 per EUR 1. The presentation currency in these consolidated financial statements is also BGN. Unless otherwise stated in the relevant place, the consolidated financial statements have been prepared and presented in thousands of BGN. 2.9. Foreign currency Transactions denominated in foreign currency are initially recorded at the official exchange rate of the Bulgarian National Bank (BNB) prevailing on the date of transaction. Exchange rate differences arising upon the settlement of monetary items or upon restatement of these items at rates, different from those that were initially recognized, are recognized in profit or loss and other comprehensive income for the period. Monetary items in foreign currencies as of December 31, 2022 and December 31, 2021, are translated using the closing exchange rates of BNB. The closing exchange rate of BGN to USD at the end of the current and prior reporting period is as follows: December 31, 2021: 1 USD = BGN 1.72685 December 31, 2022: 1 USD = BGN 1.83371 AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2022 (continued) Consolidated financial statements as of December 31, 2022 16 2. Basis of preparation of the consolidated financial statements and accounting principles (continued) 2.10. Comparative figures Under the Bulgarian accountancy legislation and IAS, the financial year ends on 31 December and companies are required to submit annual financial statements as at that date, together with comparative data as at this date the prior year. Where the group has made changes to its accounting policies which have been applied retrospectively and/or have adjusted and/or reclassifications of certain items, it presents comparative data for the two prior reporting periods in the consolidated statement of financial position and its accompanying notes as follows: - at the end of the prior reporting period; - at the beginning of the earliest comparative period. In other items of the consolidated financial statements and the accompanying notes, comparative data is presented only as at the end of the prior reporting period. 3. Definition and measurement of items of the financial statements 3.1. Property, plant and equipment and intangible assets Property, plant and equipment and intangible assets, excluding agricultural land, are presented in the consolidated statement of financial position at cost (acquisition cost) and reduced by the amount of amortization and any impairment. The agricultural land owned by the group is stated at revalued amount, which is determined as their fair value at the reporting date, less any impairment losses. Independent licensed appraisers who are appropriately qualified for such appraisals are used to determine fair value. A revaluation reserve was formed from the performed revaluations, presented as part of the capital. The revaluation reserve is recognized as retained earnings after the respective asset is written off. 3.1.1. Initial acquisition Upon initial acquisition, property, plant and equipment and intangible assets are measured at cost, which includes purchase price, customs fees and any other directly attributable costs of bringing the asset to working condition. Directly attributable costs are mainly: costs of site preparation, delivery and handling, installation, related professional fees of persons involved in the project, non-refundable taxes, etc. The group has set threshold value of BGN 700 (BGN seven hundred), under which the acquired assets, regardless of having the characteristics of non-current assets, are recognized as current expenses upon acquisition 3.1.2. Subsequent costs and depreciation Repair and maintenance costs are recognized as current expenses when incurred. Subsequent expenses incurred in relation to property, plant and equipment that have the nature of replacement of certain components, significant parts and aggregates, or improvements and restructuring, and meet the requirements for asset recognition are capitalized in the carrying amount of the respective asset and its residual useful life is reviewed as at the capitalization date. At the same time, the non-depreciated amount of the components replaced is derecognised from the carrying amount of the assets and is recognised as current expenses for the period of restructure. Depreciation of property, plant and equipment and intangible assets is calculated by systematically applying the straight-line depreciation method. Depreciation rates are determined by the management of the group based on their estimated useful life. Depreciation is not charged on land, fully depreciated assets and assets in the process of acquisition or for assets classified as held for sale in accordance with the requirements of IFRS 5 Non-current Assets Held for Sale and AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2022 (continued) Consolidated financial statements as of December 31, 2022 17 3. Definition and measurement of items of the financial statements (continued) 3.1. Property, plant and equipment and intangible assets (continued) The following rates in years of useful life have been applied by groups of assets: Group of assets; 2022 2021 Administrative and commercial buildings 25 25 Machinery and equipment 3,33- 10 3,33- 10 Transport vehicles 4 4 Computers, peripherals, software 2 2 Office equipment 6,67 6,67 Other tangible fixed assets 6,67 6,67 Intangible assets 6,67 6,67 3.2. Impairment of property, plant and equipment and intangible The carrying amounts of assets are reviewed at each year end to determine whether there is any indication of impairment. If any such indication exists, the group estimates the recoverable amount of the asset to determine the amount of impairment loss Where it is not possible to estimate the recoverable amount of an asset, the group estimates the recoverable amount of the cash-generating unit to which the class of assets belong. If the recoverable amount of an asset (or a cash generating unit) is lower than its carrying amount, the carrying amount shall be reduced to the recoverable amount of the asset (or a cash generating unit). Impairment loss is recognized as an expense in the statement of profit or loss and other comprehensive income when incurred. Where an impairment loss subsequently reverses, the carrying amount of the asset (cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognized for the asset (cash-generating unit) in prior years. A reversal of an impairment loss is recognized as income in the statement of profit or loss and other comprehensive income when incurred, unless the relevant asset is carried at revalued amount, in which case the reversal of the impairment loss is treated as an increase in the revaluation reserve. 3.3. Goodwill Goodwill represents the difference between the identifiable assets and liabilities measured at fair value and price actually paid for them in the course of a business combination. Goodwill is recognized as a non-depreciable asset and is tested annually for impairment. Impairment of goodwill cannot be reversed. 3.4. Investments in associates Non-current investments, representing shares and stakes in associates, are presented in the consolidated financial statements at cost, which is the fair value of the consideration paid, including direct costs of acquisition, less accumulated impairment losses. Investments in associates held by the group are subject to annual review for impairment. If conditions for impairment appear, it is recognized in the consolidated statement of profit or loss and other comprehensive income (in the profit or loss for the year). Upon purchase and sale of investments in associated, the entity applies the “closing date “of the transaction. AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2022 (continued) Consolidated financial statements as of December 31, 2022 18 3. Definition and measurement of items of the financial statements (continued) 3.4. Investments in associates (continued) Investments are derecognized when the rights deriving from them are transferred to other parties when the legal grounds for that occurred and thus the control over the economic benefits from the respective investments are considered lost. Profit/(loss) from the selling of such investments is presented respectively as “financial income “or “financial expenses” in the consolidated statement of profit or loss and other comprehensive income (in the profit or loss for the year). 3.5. Inventories Inventories on their acquisition are valued at acquisition cost, which includes all direct costs related to the delivery of the asset. Finished goods produced are valued at cost, including basic production costs. Work in progress is valued at the cost of basic production costs. The estimation of their consumption is performed by the method of weighted average price. At the end of the year, inventories are valued at the lower of cost and net realizable value, which is determined as the expected selling price in the course of the business, less the expected selling expenses. 3.6. Financial instruments A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity. The financial assets and financial liabilities are recognized in the statement of financial position when the entity becomes a party in the contractual relationship of the respective financial instrument generating this asset or liability. Financial assets are de-recognized from the statement of financial position after the contractual rights for receiving monetary flows have expired or the assets have been transferred and their transfer satisfies the requirements for derecognition in accordance with IFRS 9 Financial instruments. Financial liabilities are de-recognized from the Consolidated Statement of Financial Position only when they have been repaid, i.e., the obligation specified in the contract has been annulled, cancelled, or expired. The Group’s operations do not presuppose the existence of various financial instruments. The main financial instruments included in the Group’s Statement of Financial Position are presented further below. 3.6.1. Trade and other receivables Trade receivables are amounts due from customers for goods and services sold in the ordinary course of business. They are usually due for short-term settlement and are therefore classified as current. Trade receivables are initially recognized in the amount of unconditional remuneration due, unless they contain significant financing components. The Group holds trade receivables with the aim of collecting the contractual cashflows and therefore measures those at amortized cost using the effective interest method. Discounting is not performed in cases where its effect is insignificant. As at the date of preparing the financial statements, the Group assesses whether there is objective evidence for impairment with regard to the trade receivables, which are of individual significance. Impairment is being reported in case there is objective evidence that the company will not be able to collect all amounts, in accordance with the initial conditions, pertaining to the respective receivable. AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2022 (continued) Consolidated financial statements as of December 31, 2022 19 3. Definition and measurement of items of the financial statements (continued) 3.6. Financial instruments (continued) The amount of the impairment is the difference between the balance sheet value and the recoverable amount. The latter is the current value of the anticipated cashflows less the effective interest rate. The amount of the impairment of trade receivables during the current period is reported as income and expense. When a receivable is expected to be collected within a year, it is reported as a current asset. In all other cases, receivables are reported as non-current assets. Future cashflows determined for a group of financial assets, which are collectively measured for impairment, are determined on the basis of historical information pertaining to financial assets with credit risk features similar to the features of the group of financial assets. Assets for which individual impairment is applied are not included in an impairment group. The Group uses a simplified approach when reporting impairments of trade and other receivables and recognizes impairment losses as expected credit losses for the entire period. These represent the expected shortage of contractual cashflows, while considering the probability for non-performance at any moment of the financial instrument’s tenor. Significant financial difficulties of the liable person/entity, a probability for declaring it insolvent and in liquidation, financial restructuring, or impossibility for repayment of the debt (more than 30 days) are being regarded as an indicator that the trade receivable should be impaired. Upon measuring the anticipated credit losses under trade receivables, the Group has used a provision matrix, as well as its expertise in the field of credit losses under trade receivables and receivables from provided loans, to measure as estimates the expected credit losses over the financial assets’ entire tenor. The essential part of contracts with clients, as well as receivables under provided loans are concluded with trade companies, which are related parties, as a result of which the management assesses the probability of occurrence of credit losses as low. The performed analysis proves this assessment and as a result, no accrual of provisions for eventual credit losses is needed after the introduction of the new IFRS 9. 3.6.2. Cash and cash equivalents Cash and cash equivalents in BGN are stated at nominal value and cash denominated in foreign currency – at the closing exchange rate of BNB as of December 31 of the relevant year. For the purposes of preparing the cash flow statement, cash and cash equivalents are presented as non-restricted cash in hand and at banks. 3.6.3. Interest bearing loans Interest-bearing loans are initially recognised at fair value calculated through reduction of received cash proceeds by inherent transaction costs. After initial recognition, interest-bearing loans are measured at amortised cost where any difference between the initial value and the value at maturity date is reported in the profit or loss statement for the period of loan utilisation applying the effective interest rate method. No amortisation applies to received interest-bearing loans characterised with lack of transaction costs upon origination. Received bank overdrafts where the debtor may periodically utilise or repay the loan within a preliminary defined limit are treated in the same manner. Financial expenses, including direct loan attraction costs, are included in the profit or loss statement based on the effective interest method except for transaction costs related to bank overdrafts recognised in the profit or loss statement on a straight-line basis for the overdraft time period. Interest-bearing loans are classified as current when they are to be settled within twelve months after the end of the reporting period. AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2022 (continued) Consolidated financial statements as of December 31, 2022 20 3. Definition and measurement of items of the financial statements (continued) 3.6. Financial instruments (continued) 3.6.4. Payables to suppliers, other non-current payables and received advances Trade and other liabilities arise as a result of the received goods or services. No amortisation applies to short- term payables. Trade payables are recognized initially at fair value, while subsequently at amortized cost, using the effective interest rate method. 3.7. Share capital The share capital of the Group constitutes the parent company’s share capital as it is presented at nominal value and corresponds to its current legal registration. 3.8. Reserves Financial results, capitalized in prior periods, reserves of premiums associated with the issue of shares and reserves from the revaluation of some of the property, plant and equipment (see note 3.1.2), are presented as reserves in the consolidated statement of financial position of the Group. Group's shareholders may dispose of capital reserves upon decision of the General meeting. Revaluation reserves are recognized as realized by transferring them to retained earnings after the disposal of the respective asset. 3.9. Government grants Government grants for non-current assets and those to cover the costs incurred by the group are recognized as deferred income when there is reasonable certainty that they will be received and that the group will be able to meet all related requirements. Income from government grants for non-current assets is recognized in the statement of profit or loss and other comprehensive income on a systematic basis over the useful life of the asset. Government grants received as compensation for expenses incurred by the group are recognized in the statement of profit or loss and other comprehensive income in the period in which the costs associated with the grant were incurred. 3.10. Leases On the effective date of the contract, the Group assesses whether the contract represents or contains a lease. Namely, whether the contract transfers the right to control the use of the identified asset for a certain period of time. The Group as a lesee The Group applies a single approach to the recognition and measurement of all leases, except for short-term leases (ie leases with a lease term of up to 12 months) and leases of low-value assets. The Group recognizes lease liabilities for the payment of lease payments and rights of use that represent the right to use the assets. Right-of-use assets The Group recognizes rights of use from the commencement date of the lease (ie the date on which the underlying asset is available for use). Assets with a right of use are measured at cost less accumulated depreciation and impairment losses and adjusted for any revaluation of lease obligations. The cost of an asset includes the sum of the recognized lease obligations, the incurred initial direct costs and the lease payments made on or before the commencement date of the lease, an estimate of the costs to be incurred by the lessee in dismantling and relocating the lease. the asset, the restoration of the site on which it is located or the restoration of the asset to the condition required under the terms of the lease, less any incentives received under the lease. Assets with a right of use are depreciated on a straight-line basis over the lease term. AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2022 (continued) Consolidated financial statements as of December 31, 2022 21 3. Definition and measurement of items of the financial statements (continued) 3.10. Leases (continued) If, at the end of the lease term, ownership of the leased asset is transferred to the group, or the acquisition price reflects the exercise of a call option, the depreciation is calculated using the expected useful life of the asset. Lease obligations From the starting date of the lease, the Group recognizes lease liabilities measured at the present value of the lease payments that will be made over the lease term. Lease payments include flat-rate installments (including flat-rate payments) less any eligible lease incentives, variable lease payments that depend on an index or interest rate, and amounts that are expected to be paid under guarantees for residual value. Lease payments also include the cost of exercising a call option that is reasonably certain that it will be exercised by the group, as well as penalties for terminating the lease if the lease term reflects the group's exercise of the lease option termination. Variable lease payments that do not depend on an index or interest rate are recognized as an expense in the period in which the event or condition that triggers the payment occurs. In calculating the present value of lease payments, the Group uses an intrinsic interest rate on loans at the commencement date of the lease, as the interest rate set in the lease cannot be reliably determined. After the commencement date, the amount of the lease obligations increases with the interest and decreases with the lease payments madeIn addition, the carrying amount of leased liabilities is revalued if there is a modification, change in lease term, change in lease payments (for example, changes in future payments as a result of a change in the index or interest rate used to determine those lease payments). or a change in the valuation of the option to purchase the underlying asset. Short - term leases and leases of low - value assets The Group applies the exemption from recognition of short-term leases in respect of its short-term leases of buildings and vehicles (for example, leases with a lease term of 12 months or less from the starting date and which do not contain a purchase option). The Group also applies the exemption from recognizing leases of low-value assets to leases of office equipment that is considered to be of low value. Lease payments on short-term leases and leases of low-value assets are stated as an expense on a straight-line basis over the term of the lease. 3.11. Employee benefits 3.11.1. Defined contribution plans The Government of Bulgaria is responsible for providing pensions under defined contribution plans. The expenses related to the group’ s obligation to make contributions under the defined contribution plans are recognized in the statement of profit or loss and other comprehensive income as they incur. 3.11.2. Annual paid leave The Group recognizes the undiscounted amount of the estimated costs related to annual leave expected to be paid to employees in return for their service for the past reporting period. AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2022 (continued) Consolidated financial statements as of December 31, 2022 22 3. Definition and measurement of items of the financial statements (continued) 3.11. Employee benefits (continued) 3.11.3. Defined retirement plans Pursuant to the requirements of the Labour Code, upon termination of the employment contract the employees are entitled to retirement benefits amounting to two gross monthly salaries when the overall length of service of the employee in the group is less than 10 years, or six gross monthly salaries, when the overall length of service is more than 10 consecutive years. The group recognizes as current expenses the discounted amount of the accrued employee retirement benefit payables, and current interest expense based on a valuation of a certified actuary. Valuations of long-term employee benefit obligations are carried out under the projected unit credit method and this assessment as at the date of statement of financial position shall be made by certified actuaries. The amount recognized in the statement of financial position represents the present value of the obligation and in the current period the effect of any liabilities to employees that refer to it was considered, and the effect of past years was reported in the periods to which it relates. 3.12. Income and expenses recognition 3.12.1. Income from sales of services and other income Income from sales and business expenses are accrued when incurred regardless of cash proceeds and payments. The reporting and recognition of income and expenses is performed in compliance with the requirements for a cause-and-effect relationship between them. Income is measured at the fair value of the consideration received or due to be received, less the amount of all granted discounts. The Group recognizes income, when the income amount can be reliably measured, in the cases when the Group can obtain future economic benefits, and also when it meets particular criteria for each activity of the Group, as specified further below. The amounts collected on behalf of third parties, such as sales taxes like the value added tax (VAT), are excluded from income. (a) Income from sales of goods and production Income from sales of goods and production are recognized when:  The significant risks and rewards of ownership of the goods or products are transferred to the buyer;  The Group has not retained continuing managerial involvement or effective control over the goods (products) sold;  It is likely that the company will receive economic benefits as a result of the transaction;  Income and expenses directly related to the transaction can be reliably measured. (b) Income from rent of agricultural land and other assets Income from rents of assets is recognized for the reporting period for which the agricultural land or the other asset is rented. AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2022 (continued) Consolidated financial statements as of December 31, 2022 23 3. Definition and measurement of items of the financial statements (continued) 3.12. Income and expenses recognition (continued) (c) Income from sales of services Income from sales of services (administrative and other) is recognized on monthly basis for the reporting period to which refers. Income from government grants, related to compensation of incurred expenses is recognized in current profits ot losses on a systematic basis for the same period during which expenses are recognized. Income from government grants , related to compensation for investment expenses for the acquisition of an asset are recognized in the current profit or loss on a systematic basis for the entire period of the asset’s useful life, usually in the amount of the amortization recognized as expense. Profit (loss) from sales of property, plant and equipment, intangbible assets and inventories are rcognized as other income (expenses). In case of an exchange of assets , income (expense) is being reported from the exchange transaction in the amount of the difference between the fair value of the received asset and the carrying amount of the exchanged asset. When economic benefits are expected to arise over several financial periods and their relatedness to the income may be defined only in general or indirectly, expenses are recognised in the profit or loss based on procedures for systematic and rational allocation 3.12.2. Financial income and expenses Borrowing costs that are directly attributable to an asset for which the acquisition, construction or production process necessarily takes a significant amount of time before it is ready for its intended use or sale should be capitalized as part of the cost of the asset. this asset. All other financial income and expense are recognized in profit or loss for all instruments measured at amortized cost using the effective interest method. The effective interest method is a method of calculating the amortised cost of a financial asset or liability and for allocating the profit or cost for interest rates during the respective period. The effective interest method is that where expected future cash payments or income are discounted during the life of the financial instrument or in certain cases for a shorter period, from the carrying amount of the financial asset or liability. During the calculation of the effective interest rate, the Group assesses the cash flows by taking into account all contractual conditions of the financial instrument, however, without including potential future credit losses resulting from impairment. The calculation includes fees, transaction costs, premiums or discounts paid or received between the parties to the contract, which are an integral part of the effective interest rate. All other financial income and expenses are reported through profit or loss for all instruments, measured at amortized cost using the effective interest rate method. 3.13. Income tax expense According to the Bulgarian tax legislation for 2022 and 2021, the companies owe corporate tax (corporate income tax), which is determined in the amount of 10% of the tax (taxable) profit. The tax rate for 2022 remains 10%. The taxation of the profit with current tax is based on the financial results of the individual subsidiaries, which are included in the consolidation and according to the requirements of the tax legislation in Bulgaria, no adjustments are made in connection with the preparation and presentation of consolidated financial statements. AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2022 (continued) Consolidated financial statements as of December 31, 2022 24 3. Definition and measurement of items of the financial statements (continued) 3.13. Income tax expense (continued) Up to 60% of the due corporate tax is transferred to the registered agricultural producers at the expense of investments and fulfillment of certain conditions. Income tax expenses represent the sum of current tax expense and tax effects on temporary differences. The current income tax expense is based on the taxable profit (tax loss) for the period using tax rates under the tax legislation as at the date of the financial statements. Deferred tax assets and/or liabilities are the amounts of taxes recoverable and payable in future periods in respect to deductible and taxable temporary differences. Temporary tax differences are differences between the carrying amount of an asset or liability recognized in the statements of financial position and its tax base, resulting from the application of the tax rules. Deferred income taxes are calculated under the liability method. Deferred tax liabilities are calculated and recognized for all taxable temporary differences while deferred tax assets are recognized only if reversal is probable and if the group will be able to generate enough income in the future from which they can be deducted. The effect of the recognition of deferred tax assets and/or liabilities is reported where the effect of the event that incurred them is reported. For events that affect the statement of profit or loss and other comprehensive income, the effect of deferred tax assets and liabilities is also recognized in the statement of profit or loss and other comprehensive income. For events that were recognized initially in equity (revaluation reserve), deferred tax assets and liabilities are also recognized at the expense of equity. Deferred tax assets and/or liabilities are offset in the consolidated financial statements when the income taxes are levied by the same tax authority. 3.14. Critical estimates for the application of the Group ’s accounting policy. Key estimates and assumptions with high uncertainty. In the process of applying the accounting policy, the Group’s management makes estimates, which impact significantly these consolidated financial statements. Such estimates by definition are rarely equal to the actual results. As a result of their nature, they are subject to constant review and update, and they summarize the historical experience and other factors, including expectations about future events, which the management deems reasonable under the current circumstances. The estimates and assumptions entailing significant risk of material adjustment in the carrying amounts of assets and liabilities during the next financial year are stated further below. 3.14.1. Revaluation of property, plant and equipment The management has adopted a policy of appointing and using the professional services of independent licensed appraisers to determine the fair values of the agricultural lands. The following approaches and valuation methods for measuring the fair value of different types of property, plant and equipment have been applied in this valuation:  Comparative market method – derives an indicative value by comparing the asset subject to valuation with identical or similar assets for which price information is available, which is accepted with greater weight due to the nature of the properties and their current use;  Income approach – derives indictive value by presenting future cashflows to a single current capital amount. For application of this approach, it is necessary to determine the permanent generarated net annual income of the real estate (land rent), which is capitalized to present the net current value. Such revaluations should be made frequently enough in the cases when there are indications that the fair value of a certain asset class has changed considerably. AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2022 (continued) Consolidated financial statements as of December 31, 2022 25 3.14. Critical estimates for the application of the Group ’s accounting policy. Key estimates and assumptions with high uncertainty (continued) 3.14.2. Retirement benefit obligations Retirement benefit obligation is determined by actuarial valuation. This valuation requires assumptions to be made about the discount rate, future wages growth, staff turnover and mortality rates. Due to the long-term nature of staff income at retirement, these assumptions are subject to significant uncertainty. 3.14.3. Useful life of property, plant and equipment and intangible assets The financial reporting of property, plant and equipment and intangible assets includes the use of estimates of their expected useful lives and transfer values, which are based on judgments by the management of the Group. 3.14.4. Impairment of accounts receivable The management estimates the amount and period of expected future cash flows associated with receivables based on experience with current circumstances in the following groups: individual accounts, households and other retail and receivables. Due to the inherent uncertainty of this assessment, actual results may differ from those expected. The Group's management reviews the estimates from previous years and the actual results from the previous year. 3.15. Determining fair values Some of the accounting policies and disclosures of the Group require an assessment of fair values for financial and non-financial assets and liabilities. When estimating the fair value of an asset or liability, the Group uses observable data, insofar as possible. The fair values are being categorized in various levels in the Fair Values Hierarchy based on input data in the valuation techniques, as follows: • Level 1: Quoted prices (non-adjusted) on active markets for similar assets or liabilities. • Level 2: Input data other than quoted prices included in Level 1, which directly (i.e. as prices) or indirectly (i e. obtained through prices), are accessible for asset or liability monitoring purposes. • Level 3: Input data about the asset or liability, which are not based on observable market data (non- observable input data). If the input data used for measuring the fair value of an asset or liability may be categorized in different levels in the fair values hierarchy, then the assessment of the fair value is categorized in its entirety at that same level of the fair values hierarchy which input information is of significance for the overall assessment. The Group recognizes transfers between the levels of the fair values hierarchy as at the end of the reporting period, during which the change has occurred. More information about the assumptions made based on the assessment of the fair values is included in the respective appendices. AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2022 (continued) Consolidated financial statements as of December 31, 2022 26 4. Property, plant and equipment Land BGN’000 Buildings BGN’000 Machinery and equipment BGN’000 Transprort vehicles BGN’000 Right-of- use assets BGN’000 Construction in progress BGN’000 Rented assets improvements BGN’000 Total BGN’000 Cost: Balance as of January 1, 2022 125,679 38,790 39,035 17,085 20,116 3,227 - 243,932 Additions 2,955 61 7,041 6,632 5,680 19,542 1,494 43,405 Additions from new subsidiaries 240 37 162 - - - 439 Disposals (450) (64) (185) (2,285) (7,373) (6,807) - (17,164) Revaluation 47,355 - - - - - - 47,355 Balance as of December 31, 2022 175,539 39,027 45,928 21,594 18,423 15,962 1,494 317,967 Accumulated depreciation: - Balance as of January 1, 2022 - 11,525 22,777 12,673 7,191 - - 54,166 Charged for the period - 1,517 3,348 2,424 4,549 - 6 11,844 Depreciation of new subsidiaries assets - 15 2 8 - - - 25 Depreciation of disposals - (58) (175) (2,228) (5,319) - - (7,780) Balance as of December 31, 2022 - 12,999 25,952 12,877 6,421 - 6 58,255 Carrying amount as of December 31, 2022 175,539 26,028 19,976 8,717 12,002 15,962 1,488 259,712 Carrying amount as of December 31, 2021 125,679 27,265 16,258 4,412 12,925 3,227 - 189,766 The Group has lease agreements for land, office space and vehicles used in the ordinary activities. The terms are between 2 and 19 years with extension options. To secure investment and working capital loans received by the Group, the Group has established a pledge and mortgage in favor of the creditor banks on property, plant and equipment, with a carrying amount of BGN 148,824 thousand (see also notes 14 and 19). The Group has included in the property, plant and equipment assets acquired under financial lease agreements with a carrying amount of BGN 8,442 thousand (see note 15). To determine the fair value of the land owned, the Group uses the services of a licensed appraiser with recognized professional qualifications and experience. Fair value is based on the market value, which is the expected amount for which a property can be exchanged on the valuation date between a willing buyer and seller in a market transaction after the relevant marketing in which the parties have acted with awareness. The market value is determined as a weighted-average value of the results obtained by the individual methods and weights, expertly determined according to the reliability of the information used and the experience of the appraiser. AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2022 (continued) Consolidated financial statements as of December 31, 2022 27 4. Property, plant and equipment (continued) The fair value of land is categorized as the fair value of Level 3 based on the inputs for the valuation technique used. Assets under construction presented in the consolidated statement of financial position represent expenses incurred by the Group for construction and acquisition of property, plant and equipment, which at the end of the reporting period have not been completed and have not been put into operation as follows: 31.12.2022 BGN’000 31.12.2021 BGN’000 Construction and modernization of warehouses, agricultural and logistics facilities 15,962 3,227 Total 15,962 3,227 5. Intangible assets Software BGN'000 Rights-of-use BGN'000 Intangible assets under construction BGN'000 Total BGN'000 Cost: Balance on January 1, 2022 372 107 97 576 Additions - - - - Disposals - - - - Balance on December 31, 2022 372 107 97 576 Accumulated depreciation: Balance on January 1, 2022 359 89 - 448 Charged for the period 13 4 - 17 Disposals - - - - Balance on December 31, 2022 372 93 - 465 Carrying amount on December 31, 2022 - 14 97 111 Carrying amount on December 31, 2021 13 18 97 128 6. Non-curent investments December 31, 2022 December 31, 2021 BGN’000 % BGN’000 % „AB Investments Group” AD 10,100 50.00 - - „AgroOil Consult” OOD 505 50.00 505 50.00 „Energy Solar Technology” AD 20 33.33 - - “ Ecobulpack ” AD 9 0.46 5 0.46 “Korn Star” OOD - - 2 40.00 Total 10,634 x 512 x "Energy Solar Technologies" JSC develops activity in the field of energy production from renewable sources, through the utilization of solar energy, through investments in solar parks. Investments in energy projects from renewable sources are within the scope of the Group's activities, as part of the developed business model. AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2022 (continued) Consolidated financial statements as of December 31, 2022 28 6. Non-curent investments (continued) The activity of "Agro Oil Consult" Ltd. is in the field of agriculture and trade in fertilizers, preparations and agricultural products. The activity of "AB Investments Group" AD is focused on the construction and sale of real estate. When preparing the consolidated financial statements for 2022, the management of the Group has considered that there are grounds to treat "Korn Star" OOD as a subsidiary. On March 31, 2022, "Korn Star" OOD, according to a signed contract, acquired the commercial enterprise of the agricultural cooperative "Vedrina". The value that the Group paid for this acquisition is BGN 1,300 thousand. 7. Non-curent receivables During a previous period, the Group has agreed on the settlement of a trade receivable under deferred payment terms. The receivable is to be settled after 2022. The receivable is secured by a real estate, owned by the debtor. An interest of 5 % p.a. is accrued. 8. Goodwill The goodwill presented in the consolidated statement of financial position arose as a result of business combinations carried out during the current year, related to the acquisition of control over the net assets and activities of subsidiaries. The management of the Group has carried out the necessary procedures to carry out the mandatory test for impairment of the goodwill recognized in the consolidated statement of financial position, upon acquisition of subsidiaries, and considers that as of December 31, 2022 there are no conditions for accrual of impairment of the goodwill recognized in the statement of financial position, in the amount of BGN 2,326 thousand. 9. Inventories December 31, 2022 BGN’000 December 31, 2021 BGN’000 Goods 58,133 84,718 Impairment of goods (6,184) - Goods, net of impairment 51,949 84,718 Materials 35,486 20,600 Work in progress 16,031 9,206 Production 5,179 4,218 Total 108,645 118,742 9.1. Goods December 31, 2022 BGN’000 December 31, 2021 BGN’000 Fertilizers 17,212 369 Wheat 16,684 21,214 Corn 11,000 20,989 Sunflower 7,032 42,146 Barley 21 - Total 51,949 84,718 AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2022 (continued) Consolidated financial statements as of December 31, 2022 29 9. Inventories (continued) 9.2. Work in progress December 31, 2022 BGN’000 December 31, 2021 BGN’000 Wheat 7,849 4,016 Sunflower 4,330 2,366 Corn 2,690 2,039 Barley 1,162 785 Total 16,031 9,206 9.3. Production December 31, 2022 BGN’000 December 31, 2021 BGN’000 Raw sunflower oil 3,207 3,151 Corn 1,263 - Cereals 656 333 Refined oil 51 731 Useful waste 2 3 Total 5,179 4,218 In accordance with IAS 41 Agriculture , the Group should measure unprocessed agricultural produce at fair value at the point of harvest. The management of the Group has decided not to carry our such measurement on an ongoing basis during the reporting period, as in the ordinary course of business finished goods are sold on the market through their sale, and the amounts of agricultural produce in stock as at the reporting date are immaterial. The management also believes that the application of this policy does not lead to a change in the reported financial results of the group or a change of current stocks of inventories as compared to the results that would have been reported if the Group had measured unprocessed agricultural products at fair value at the date of production. As collateral the Group has established a pledge on inventories in relation to investment and working capital bank loans (see note 14 and 19). 10. Accounts receivable and loans granted December 31, 2022 BGN’000 December 31, 2021 BGN’000 Receivables from clients 36,391 46,090 Impairment of receivables from clients (866) (3,183) Receivables from clients, net of impairment 35,525 42,907 Receivables form trade loans, incl. interest 33,592 43,577 Advances 25,833 35,739 Impairment of advances (575) (575) Advances, net of impairment 25,258 35,164 Taxes recoverable 11,403 1,463 Receivables from government grants 3,458 3,362 Prepaid expenses 557 319 Receivables from employees 128 183 Other receivables 103 496 Total 110,024 127,471 AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2022 (continued) Consolidated financial statements as of December 31, 2022 30 10. Accounts receivable and loans granted (continued) 10.1. The Group has provided trade loans to other trade companies amounting to BGN 33,592 (as of December 31, 2021 - BGN 43,577 thousand). Loan interest for 2022 is from 1.5 % to 3% p.a. Part of the loans are to be repaid till 2022 but according to the conditions of the contracts signed, in which no repayment schedule has been provisioned, the amounts due may be repaid before the set term. Thus, the management of the Group treats the receivables according to these loan contracts as current. The short-term trade loans provided to related companies and trade counterparties are intended to support and finance the activities of these companies for common business and strategic purposes. 10.2. The receivables from clients as of December 31, 2022, 2021 are mainly from sales of grain, production, and sales of services. Typically, the Group negotiates the payment of receivables on sales of goods and products within 90 days with its clients The Group uses loans from commercial banks in order to offset the credit extended to customers. The credit periods agreed with customers on sales of services do not exceed 60 days. The aging analysis of receivables from clients is presented below: 31.12.2022 BGN’000 31.12.2021 BGN’000 Not overdue 22,076 6,869 Up to 90 days 6,506 32,350 90 – 180 days 3,387 2,405 180 – 360 days 1,708 819 Over 360 days 1,848 464 35,525 42,907 11. Cash and cash equivalents December 31, 2022 BGN’000 December 31, 2021 BGN’000 Cash and cash equivalents in BGN 2,500 1,656 Cash and cash equivalents in foreign currency 2,017 123 Blocked cash and cash equivalents 31 73 Total 4,548 1,852 The Group’s cash and cash equivalents are in bank accounts in banks with stable long -term ratings. The management has assessed the expected credit losses on cash and cash equivalents. The assessed amount is less than 0.3% of the cash gross value, deposited in financial institutions due to which it was deemed as immaterial and was not accrued in the financial statements of the Group as of December 31, 2022. Blocked cash and cash equivalents as of December 31, 2022, presented in the consolidated cashflow statement are in connection with blocked funds on a current bank account, which serve as collateral in connection with a precautionary measure imposed by a private bailiff in an upcoming enforcement case. 12. Share capital The fully paid-in share capital of the parent company amounting to BGN 6,800 thousand is presented at par value and corresponds to the court decision for registration. As at the end of the reporting period, shareholders in the Group are: as of December 31, 2022 name Number of shares: % of capital „ EMRA ” EOOD 2 795 500 41.11 % „KOMERS”EOOD 1 855 639 27.29 % Svetlomir Iliev Todorov 697 355 10.26 % Other individuals and companies with less than 5 % 1 451 506 21.34 % Total 6 800 000 100.00% AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2022 (continued) Consolidated financial statements as of December 31, 2022 31 12. Share capital (continued) as of December 31, 2 2021 Name Number of shares % of capital „ EMRA ” EOOD 2 795 500 41.11% „KOMERS”EOOD 1 838 385 27.04% Svetlomir Iliev Todorov 692 434 10.18% UPF” DOVERIE” 338 624 4.98% Other individuals and companies with less than 5 % 1 135 057 16.69% Total 6 800 000 100.00% On September 27, 2022, Agria Group Holding AD acquired 50,000 of its own shares at a price of BGN 27.80 per share (for a total of BGN 1,390 thousand), representing 0.73% of the registered capital. The purpose of the buyback is to increase the liquidity of the shares of the Parent Company. 13. Reserves The reserves presented in the consolidated statement of financial position include premiums, the accumulated gains of past years, reserves from subsequent evaluations of farmland and buildings, as well as reserves from revaluation of obligations to staff arising from defined benefit plans. 14. Interest bearing bank loans December 31, 2022 December 31, 2021 Type of currency Contracte d loan amount Maturity Non- current portion Current portion Total Non- current portion Current portion Total BGN’000 BGN’000 BGN’000 BGN’000 BGN’000 BGN’000 BGN’000 Investment loans EUR 8,200 30.09.2028 8,038 1,789 9,827 9,815 1,784 11,599 BGN 6,000 30.08.2027 2,444 667 3,111 3,111 667 3,778 BGN 6,000 02.12.2026 3,938 1,360 5,298 5,288 668 5,956 BGN 3,912 12.09.2026 1,138 428 1,566 1,564 428 1,992 BGN 5,867 20.02.2025 886 665 1,551 1,550 666 2,216 BGN 5,867 20.03.2024 326 653 979 978 653 1,631 EUR 2,000 29.02.2024 93 559 652 698 559 1,257 EUR 2,000 30.01.2024 46 559 605 559 559 1,118 BGN 4,000 04.02.2027 2,806 864 3,670 3,670 330 4,000 BGN 10,000 30.04.2024 514 1,116 1,630 1,630 1,116 2,746 BGN 6,000 14.08.2025 1,188 713 1,901 1,901 713 2,614 BGN 10,000 01.12.2026 3,333 1,111 4,444 4,445 1,111 5,556 BGN 5,000 28.06.2028 2,369 526 2,895 2,895 526 3,421 EUR 7,600 01.02.2030 7,835 - 7,835 - - - EUR 357 30.03.2022 - - - - 36 36 EUR 2,000 30.12.2022 - - - - 559 559 Total 34,954 11,010 45,964 38,104 10,375 48,479 Interest on investment loans is payable on a monthly basis, with the agreed interest rates in the range of one- month and three-month EURIBOR, increased by 1,3 and 3,5 % points. AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2022 (continued) Consolidated financial statements as of December 31, 2022 32 14. Interest bearing bank loans (continued) Investment loan agreements also contain clauses for maintaining certain financial ratios, the implementation of which the Group's management currently controls and communicates with the creditor banks. The liabilities on the loans disclosed above have been secured for the benefit of bank creditors with: - Contracted mortgages on real estate owned by the Group (see note 4); - Special pledges on plant and equipment owed by the Group (see note 4); - Special pledges on trade accounts receivable. 15. Lease contracts obligations Operating lease obligations The operating lease obligations presented in the Statement of Financial Position include the liabilities of the Group under leases of land, buildings and vehicles, which are recognized in accordance with the requirements of IFRS 16 Leasing (see also item 3.10 and item. 4). As of December 31, 2022, operating lease obligations amount to BGN 10,062 thousand (December 31, 2021 – BGN 12,061 thousand). The short-term part of them, payable in the next 12 months after the accounting periods presented in this report, is presented in current liabilities (see item 19). Finance lease obligations The Group has concluded finance lease contracts for the acquisition of cars, machinery, equipment and agricultural machinery with a deadline for repayment of the last installments on them in the period 2022 - 2026. According to the terms of the contracts, the group owes an annual interest rate of three-month EURIBOR, increased by a margin of 1.8 % to 6.51 % on the outstanding part of the contractual obligation. As of December 31, 2022 the financial leasing liabilities amounting to BGN 10,915 thousand (December 31, 2021- BGN 4,745 thousand). The short-term part of them, payable in the next 12 months after the reporting periods presented in this report, is presented in current liabilities (see item 19). 16. Deferred tax assets/(liabilities), net December 31, 2022 BGN’000 December 31, 2021 BGN’000 . Deferred tax assets: Tax effect of impairment of receivables 419 362 Tax effect of impairment of inventories 618 - Tax effect of receivables written-off 94 75 Tax effect of current employee benefits 94 28 Tax effect of non-current employee benefits 36 23 Tax effect of unutlized paid leaves 52 15 Ttoal deferred tax assets 1,313 503 Deferred tax liabilities: Tax effect on revaluation reserve of non-depreciable assets (9,899) (5,212) Tax effect of difference of carrying amount of non-current assets (84) (3) Ttoal deferred tax liabiliites (9,983) (5,215) Deferred tax assets/(liabilities), net (8,670) (4,712) AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2022 (continued) Consolidated financial statements as of December 31, 2022 33 17. Trade loans In November 2018 the Group entered into a loan agreement with a related party amounting to BGN 724 thousand. The amount was utilized in November 2018. The agreed interest rates are in the range of 3%. The deadline for repayment of the loan is April 2023. As of December 31, 2022 the loan has been fully utilized, the outstanding principal under the contract amounts to BGN 724 thousand (December 31, 2021 - BGN 724 thousand). The current partion as of December 31, 2022 amounts to BGN 724 thousand (December 31, 2021 - BGN 529 thousand). 18. Other non-current liabilites 18.1. Non-current liabilities to personnel The movement of non-current liabilities to employees is as follows: December 31, 2022 BGN’000 December 31, 2021 BGN’000 Opening balance 396 294 Current service cost 99 71 Expenses paid during the period (40) (5) Recognized actuarial gains/(losses) (11) 2 Financial expenses for future obligations 3 2 Expenses recognized in profit and loss 51 70 Revaluation of retirement benefit obligations regognized in other comprehemsive income (83) 32 Closing balance 364 396 The main actuarial assumptions used in the calculations are as follows: December 31, 2022 BGN’000 December 31, 2021 BGN’000 Discount rate 5.5 0,6 % Expected increase of salaries 3 3 % Weighted-average retirement age for man 64 64 Weighted average retirement age for woman 62 61 In addition, in the event of early retirement due to incapacity for work, staff are entitled to benefits of up to two monthly salaries, increased by 100% for a minimum of five years of service and provided that no such benefits have been received in the last five years. The demographic statistical assumptions used are based on the following: - - rate of staff turnover in the group during the past few years; - mortality rate of the population of Bulgaria for the period 2019 - 2021 according to the National Statistics Institute; - statistics of the National Health Information Centre on disability of the population and early retirement. AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2022 (continued) Consolidated financial statements as of December 31, 2022 34 18. Other non-current liabilities (continued) 18.2. Government grants The Group has received financial assistance under the programme for rural development granted by the State Fund "Agriculture" during the period 2014-2020. The grant amounts to BGN 1,331 thousand. Government grants, presented in statement of financial position as of December 31, 2022, amounting to BGN 880 thousand (December 31, 2021 – BGN 983 thousand) represent deferred income for group of assets acquired, which should be recognized in statement of profit or loss and other comprehensive income on a systematic basis during the lifetime of assets. The current portion amounts to BGN 103 thousand (December 31, 2021 – BGN 102 thousand). 19. Current liabilities 19.1. Current interest-bearing bank loans Type of currency Contracted loan amount in BGN’000 Maturity December 31, 2022 December 31, 2021 BGN’000 BGN’000 Revolving working capital loans EUR 12,000 30.11.2023 18,604 19,560 BGN 6,000 30.06.2023 2,944 3,367 EUR 30,000 12.07.2023 43,915 54,535 BGN 4,000 30.01.2023 3,611 3,504 BGN 2,000 30.01.2023 2,000 2,000 EUR 5,000 31.01.2023 2,151 86 EUR 30,000 31.12.2023 6,229 43,319 EUR 3,000 30.07.2023 - 65 BGN 10,000 11.02.2023 8,309 - BGN 280 31.03.2022 - 280 BGN 1,500 31.03.2022 - 1,500 BGN 720 31.03.2022 - 585 EUR 15,000 12.04.2023 27,491 17,467 BGN 1,000 30.07.2024 600 - BGN 1,200 30.01.2023 1,200 - Total 117,054 146,268 Interest on working capital loans is due monthly, with the agreed interest rates in the range of one-month and three-month EURIBOR, increased by 1.20 and 3 percentage points. In favor of the creditor banks the following collaterals are established: - Agreed mortgages on real estate owned by the Group (see note 4); - Special pledge on machinery and equipment owned by the Group (see note 4); - Special pledges on materials, goods and finished products owned by the Group (see note 8); - Special pledges on trade receivables, as well as current and future receivables of the Group from State Fund "Agriculture" 19.2. Current trade loans In the previous year, the Group received loans from trade companies amounting to BGN 10,000 thousand. The loan interests are 3.2% per annum. As of December 31, 2022, the loan obligation amounts to BGN 4,300 thousand principle and BGN 1,540 thousand interest (December 31, 2021 – BGN 4,300 thousand principle and BGN 1,402 thousand interest). The loan is unsecured. AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2022 (continued) Consolidated financial statements as of December 31, 2022 35 19. Current liabilities (continued) 19.3. Trade and other liabilities December 31, 2022 BGN’000 . December 31, 2021 BGN’000 Current portion of non-current interest-bearing loans, incl. interests 11,010 10,375 Taxes 3,582 2,821 Current portion of finance lease obligations 3,205 1,674 Advances received 2,848 603 Liabilities to suppliers 2,547 32,734 Current portion of operating lease obligations 1,828 3,065 Liabilities to personnel 1,730 1,021 Current portion of non-current trade loans, incl. interest 814 647 Obligations under contracts for rent of agricultural land 811 492 Social security 442 279 Current portion of government grants 103 102 Other liabilities 404 178 Total: 29,324 53,991 20. Income from sales Year ended 31.12.2022 BGN’000 Year ended 31.12.2021 BGN’000 Income from sales of goods and materials 616,487 375,431 Income from sales of production 73,347 50,899 Income from sales of services 6,595 4,495 Total: 696,429 430,825 21. Income from government grants Year ended 31.12.2022 BGN’000 Year ended 31.12.2021 BGN’000 Income from grants, relate to expenses 7,697 6,190 Total: 7,697 6,190 22. Other income Year ended 31.12.2022 BGN’000 Year ended 31.12.2021 BGN’000 Income from penalites 1,384 2,386 Profit from sales of non-current assets, net 442 345 Income from sales of non-current assets 442 891 Carrying amount of assets sold - (546) Other income 91 490 Total: 1,917 3,221 AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2022 (continued) Consolidated financial statements as of December 31, 2022 36 23. Materials expenses Year ended 31.12.2022 BGN’000 Year ended 31.12.2021 BGN’000 Main materials 91,287 51,587 Fuel and lubricants 11,485 6,039 Electricity, natural gas and water 2,584 1,202 Spare parts and materials for repairs 2,472 2,079 Office materials and consumables 47 76 Other 660 475 Total: 108,535 61,458 24. Hired services Year ended 31.12.2022 BGN’000 Year ended 31.12.2021 BGN’000 Logistics, processing, and export expenses 7,564 5,080 Production related hired services 7,135 3,812 Consulting services 1,366 755 Rents 1,361 428 Insurances and subscriptions 1,096 853 Taxes 957 551 Maintenance and repairs 720 241 Notary, legal and administrative services 143 180 Communication expenses 118 102 Other 574 569 Total: 21,034 12,571 Production related hired services include all costs of rents, lease of agricultural machinery, as well as agricultural services. Logistics expenses are related to the transportation of finished goods and production. Insurances are made on non-current assets - agricultural machinery and attached equipment, owned by the Group. The expenses for audit services of the companies of the Group for 2022 and 2021 amounts to BGN 64 thousand (2021:BGN 52 thousand). The auditors of the Group did not provide other consulting services, except those for the independent financial audit. 25. Personnel expenses Year ended 31.12.2022 BGN’000 Year ended 31.12.2021 BGN’000 Salaries and wages 19,243 12,157 Social security 2,667 1,841 Unutilized paid leaves 330 63 Total: 22,240 14,061 AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2022 (continued) Consolidated financial statements as of December 31, 2022 37 26. Other expenses Year ended 31.12.2022 BGN’000 Year ended 31.12.2021 BGN’000 Advertising expenses and donations 380 68 Business trip expenses 217 31 Receivables written-off 184 686 Interests on tax liabilities and penatlies 53 3 Expenses for penalties and compensations 48 - Other 317 32 Total: 1,199 820 27. Impairment Year ended 31.12.2022 BGN’000 Year ended 31.12.2021 BGN’000 Impairment of accounts receivable 6,184 - Impairment of construction in progress expenses 576 2,146 Total 6,760 2,146 28. Financial income Year ended 31.12.2022 BGN’000 Year ended 31.12.2021 BGN’000 Profit from operations with financial assets 1,181 216 Incomes from foreign exchange transactions 1,083 - Interest income 927 985 Dividends income 100 - Total 3,291 1,201 29. Financial expenses Year ended 31.12.2022 BGN’000 Year ended 31.12.2021 BGN’000 Interest expenses on loans and finance leases 4,059 3,014 Bank taxes and commissions 793 752 Expenses on foreign exchange transactions 468 68 Loss from operations with financial assets - 2,724 Total 5,320 6,558 30. Income tax expense Year ended 31.12.2022 BGN’000 Year ended 31.12.2021 BGN’000 Accounting profit 76,722 25,617 Applicable tax rate 10% 10% Income tax at applicable tax rate 7,672 2,562 Net tax effect of permanent tax differences 470 176 Total income tax expense/(benefit) 8,142 2,738 AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2022 (continued) Consolidated financial statements as of December 31, 2022 38 31. Earnings per share and dividends Earnings per share are calculated using the net profit, which is subject to distribution among the shareholders of the Group. Year ended 31.12.2022 BGN’000 Year ended 31.12.2021 BGN’000 Profit attributable to shareholders (in BGN) 68,580,000 22,879,000 Weighted-average number of shares 6,800,000 6,800,000 Earnings per share (in BGN per share) 10.09 3.36 By resolution of the General Meeting in 2022 the Group has distributed dividends in the amount of BGN 2,500 thousand (in 2021 - BGN 1,000 thousand). 32. Financial instruments and financial risk management The carrying amounts of assets and liabilities as of December 31, 2022 and 2021 by categories in accordance with IFRS 9 Financial instruments are presented in the following tables: Financial assets Year ended 31.12.2022 BGN’000 Year ended 31.12.2021 BGN’000 Loans granted 33,592 43,577 Trade receivables 60,783 78,071 Cash and cash equivalents 4,548 1,852 Total 98,923 123,500 Financial liabilities Year ended 31.12.2022 BGN’000 Year ended 31.12.2021 BGN’000 Interest bearing loans 169,672 199,771 Finance lease obligations 10,915 4,745 Operating lease obligations 10,062 12,061 Trade liabilities 5,395 33,337 Total 196,044 249,914 32.1. Financial risk factors The use of financial instruments exposes the group to market, credit and liquidity risk. These paragraphs provide information on the objectives, policies, and processes for managing these risks, as well as on the capital management. The financial risks are currently identified, measured, and monitored using various controlling mechanisms introduced for determining adequate prices of products and services, the cost of borrowings and the forms of maintaining free liquid funds without allowing an unreasonable concentration of a certain risk. Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk includes currency risks, interest rate risk and price risk. Credit risk is the risk that one party to a financial instrument will cause a financial loss for the other party by failing to discharge an obligation to the terms of a contract. Liquidity risk is the risk that an entity will encounter difficulty in meeting obligations associated with financial liabilities. AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2022 (continued) Consolidated financial statements as of December 31, 2022 39 32. Financial instruments and financial risk management (continued) 32.1.1. Currency risk The Group trades in a currency other than its functional currency, which is why it is exposed to risk related to possible changes in exchange rates. Such risk arises mainly from changes in the US dollar exchange rate, as the Group makes purchases denominated in US dollars. Transactions in euros do not expose the group to currency risk, as since January 1, 1999 BGN has been pegged to this currency. The sensitivity analysis to foreign exchange risk shows that the financial results of the Group would not change significantly due to changes in the exchange rate, as the group does not have significant foreign exchange risk exposures. 32.1.2. Interest rate risk The Group is exposed to interest rate risk because some of the loans received have a variable interest rate agreed as a base interest rate (EURIBOR), increased by a certain margin. In 2022 and 2021, loans with variable interest rates are in EUR and BGN. The interest rates are specified in the respective notes. December 31, 2022 BGN’000 December 31, 2021 BGN’000 Instruments with fixed interest rate Financial assets 30,940 43,577 Financial liabilities 5,024 5,024 Instruments with floating interest rate Financial assets - Financial liabilities 163,018 194,747 The sensitivity analysis to interest rate risk is based on the assumption that interest rate positions with variable interest rates at the date of the statement of financial position existed in the same amount throughout the year and reasonably possible increase/decrease in interest rates by 0.5%. If interest rates were higher/lower by 0.5%, provided that all other variables were constant, the financial result after taxes for the year would be BGN 815 thousand (December 31, 2021 - BGN 974 thousand) lower/higher. 32.1.3. Credit risk Credit risk is the risk that one party to a financial instrument will fail to meet its obligation and thereby cause a loss to the other. The financial assets that potentially expose the group to credit risk are mainly sales receivables and interest loans. The Group is mainly exposed to credit risk in the event that customers fail to meet their obligations. The Group's policy in this area is aimed at selling to customers with an appropriate credit reputation and the use of adequate collateral as a means of limiting the risk of financial losses. The credit quality of customers is assessed considering financial condition, past experience and other factors. Credit limits have been introduced, compliance with which is monitored regularly. AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2022 (continued) Consolidated financial statements as of December 31, 2022 40 32. Financial instruments and financial risk management (continued) 32.1.4. Liquidity risk Liquidity risk is the risk that the group will fail to pay its financial liabilities when they fall due. The policy in this area is aimed at ensuring the availability of sufficient liquid funds, which can be used to settle liabilities when they fall due, including in emergency and unforeseen situations. The following table presents the agreed maturities of financial liabilities based on the earliest date on which the Group may be required to pay them. The table shows the undiscounted cash flows, including principal and interest: December 31, 2022 BGN’000 Up to one year Between two and five years Over five years Total Interest bearing loans liabilities 134,718 34,028 926 169,672 Finance lease obligations 3,205 7,710 - 10,915 Trade and other liabilities 5,395 - - 5,395 143,318 41,738 926 185,982 December 31, 2021 BGN’000 Up to one year Between two and five years Over five years Total Interest bearing loans liabilities 157,222 41,656 893 199,771 Finance lease obligations 1,674 2,801 - 4,475 Trade and other liabilities 33,337 - - 33,337 192,233 44,457 893 237,583 32.2. Capital management The Group manages its capital to operate as a going concern while it seeks to maximize returns to shareholders through the optimization of the debt-to-equity ratio (return on capital invested). The aim of the management is to maintain the confidence of investors, creditors, and the market and to ensure the future development of the group. The group's management monitors the capital structure based on the net debt-to-equity ratio. Net debt includes non-current and current interest-bearing loans and non-current and current finance lease liabilities, less cash. Share capital, reserves and accumulated profits form the equity of the Group. December 31, 2022 BGN’000 December 31, 2021 BGN’000 Debt 180,587 204,246 Cash and cash equivalents (4,548) (1,852) Net debt 176,039 202,394 Equity 285,170 178,302 Debt to equity ratio 0.62 1.14 AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2022 (continued) Consolidated financial statements as of December 31, 2022 41 32. Financial instruments and financial risk management (continued) The management of the Group determines the amount of capital required in proportion to the level of risk that characterizes individual activities (projects, business segments). The maintenance and adjustment of the capital structure is carried out in close connection with changes in economic conditions, as well as depending on the level of risk inherent in the relevant assets (projects) in which investments are made. The main tools that are used to manage the capital structure are: sale of assets, to reduce the level of indebtedness, etc. All decisions on changes in this direction are made considering the balance between the price and the risks inherent in the various sources of financing. 32.3. Fair value The Group's policy is to disclose in its financial statements the fair value of financial assets and liabilities, especially where quoted market prices exist. The concept of fair value assumes realisation of financial instruments by way of a sale. However, in many cases, particularly with respect to trade receivables and payables and loans, the group expects to realize these financial assets through their total payment or repayment over time. Therefore, they are presented at their nominal value or amortized cost. Most of the financial assets and liabilities are short-term trade receivables and payables and short-term loans, therefore their fair value approximates their carrying amount. The management of the group considers that in the current circumstances the estimates of financial assets and liabilities presented in the statement of financial position are as reliable, adequate, and reliable as possible for the purposes of financial reporting. 33. Disclosure of related parties transactions During the year, the following major transactions were made with related parties, key management personnel, shareholders, as well as with other companies treated as related parties. 33.1. Key management personnel remuneration Key management personnel of the Group include the Executive Director and the members of the Board of Directors. The key management personnel remuneration includes the following costs: 2022 2021 BGN’000 BGN’000 Current remmunerations: Salaries 812 564 Total 812 564 The Group has entered into transactions with its shareholders as well as with other companies treated as related parties. AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2022 (continued) Consolidated financial statements as of December 31, 2022 42 33.2. Transactions with sahreholders The transactions and outstanding balances as of December 31, 2022 are as follows: Outstanding balance Name Type of transaction Turnover Receivable Liabilitiy BGN’000 BGN’000 Komers AD Trade transactions – purchases 40,729 - 174 Trade transactions – sales 2,013 2,053 - Loans granted 7,168 13,608 - Interest on loans granted 311 562 - Total: х 16,223 174 32.3. Transactions with other related parties Agro Oil Consult OOD Trade transactions – purchases 8,868 - 37 Loans granted 400 400 - Interest on loans granted 9 9 - Loans obtained - - 724 Interest on loans obtained 22 - 90 Dividends received 100 - - Total: х 409 851 Energy Solar Technologies AD Trade transactions – sales 4 4 - Loans granted 650 650 - Interest on loans granted 8 8 - Total: х 662 - All related party transactions are ongoing. The terms of the transactions do not differ from the market terms, which are applied between unrelated parties. 34. Events after the reporting period On February 8, 2023, "Agria Group Holding" JSC entered into a final contract for the purchase and sale of 441,866 ordinary registered non-voting shares from the capital of the trading company "Almagest" JSC, with a nominal value of BGN 80 each, representing 100 % of the capital of "Almagest" AD. On this date, the shares were transferred from the sellers to the buyer through registration of the transfer transaction in the Central Depository AD, in accordance with the requirements of the current legislation, and "Agria Group Holding" AD acquired the ownership of the right of ownership over 100% of the shares from the capital of " Almagest" JSC. The shares have been transferred to the buyer "Agria Group Holding" AD without any obligations, encumbrances, rights and claims of third parties, together with all rights arising from or related to them. AGRRIA GROUP HOLDING AD NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS as of December 31, 2022 (continued) Consolidated financial statements as of December 31, 2022 43 35. Other disclosures At the end of February in the previous year 2022, a military conflict between Russia and Ukraine began. As a result, normal trade relations with the two affected countries are severely disrupted. The European Union and many countries around the world imposed several economic sanctions on Russia. The restrictive economic and financial measures undertaken could lead to a change in the prices of energy carriers and other goods and services that are important for the development of the Bulgarian economy. This, in turn, may indirectly have an adverse impact on the Group’ s activities in subsequent accounting periods. Its management is currently analyzing and monitoring all changes in events, with the aim of determining protective and stabilization measures. With their implementation, it is expected that the negative consequences of the military conflict will be mitigated to the extent that they will not have a significant negative impact on the future viability and the ability of the Group to continue its activities as a going concern. AGRIA GROUP HOLDING AD Annual consolidated report 2022 44 ANNUAL CONSOLIDATED REPORT AS AT DECEMBER 31, 2022 ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 45 AGRIA GROUP HOLDING JSC ANNUAL CONSOLIDATED ACTIVITY REPORT 2022 ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 46 ANNUAL REPORT ON THE OPERATIONS OF AGRIA GROUP HOLDING AD, VARNA FOR THE 2022 FINANCIAL YEAR The present report has been drawn up in accordance with the provisions of Article 39, 44 AND 45 of the Accountancy Act, Article 100n (7) and (8) of the Public Offering of Securities Act (POSA) and Appendix No. 2 to Article 10, item 1, article 11, item 1 of Ordinance No. 2 of FSC on the Prospectuses for Public Offering and Admission of Securities to Trading on a Regulated Market. The report provides comments and analysis of the consolidated financial statements and other material information concerning the financial position and results of the operations of the Company and present fairly the position and the perspectives for development of the Company. The management of the Company, represented by the members of the Board of Directors of Agria Group Holding AD, believe that the circumstances that occurred during the past year of 2022 may be important for investors in deciding whether to invest in the securities of the Company. All circumstances that occurred have been disclosed in the terms and manners provided for in POSA to the investors, the regulated securities market and Financial Supervision Commission, and are available on the Company's website - www.agriabg.com ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 47 1. GENERAL INFORMATION ABOUT AGRIA GROUP HOLDING JSC COUNTRY OF ESTABLISHMENT: Republic of Bulgaria REGISTERED OFFICE AND BUSINESS ADDRESS: 111 Knyaz Boris I Blvd, Primorski District, Varna, Business Center, 9th floor. MAILING ADDRESS: 111 Knyaz Boris I Blvd, Primorski District, Varna, Business Center, 9th floor. TELEPHONE: 052/ 554000; FAX: 052/ 511602 INTERNET ADDRESS: www.agriabg.com E-MAIL ADDRESS: [email protected] , [email protected] LEGISLATION: The Company operates in compliance with the existing Bulgarian legislation. UNIFIED IDENTIFICATION CODE: 148135254 AGRIA GROUP HOLDING AD was established by transformation through change of the legal form under the terms and conditions of Article 264 and the following of the Commerce Act from limited liability company AGRIA GROUP HOLDING into joint-stock company with the same company name. The joint-stock company is registered and entered into the Company Register with Decision from 28 August 2007 under company case No.3875/2007 under the docket of Varna District Court. The same Decision also enters the winding up of the transformed limited liability company and the name of the newly registered joint-stock company is AGRIA GROUP HOLDING. The Company was re-registered by entry into the Commercial Register maintained by the Registry Agency under the terms and conditions stipulated in the Commercial Register Act. There have been no other changes in the legal and organisational form of the Company other than the transformation specified above. The life of the Company is not limited in time and there are no other conditions for its termination. The company has not been wound-up, it has not gone into liquidation, and has not been deleted from the Commercial Register. In December 2007 the Company increased its capital in an initial public offering through the successful issue of 1,700,000 shares with par value of BGN 1 each and issue value of BGN 9.04 each. As at 31.12.2022 the registered capital of the Company was BGN 6,800,000 (six million and eight hundred thousand leva), distributed in 6,800,000 (six million and eight hundred thousand) ordinary, registered, dematerialized, voting shares with par value of BGN 1 (one lev) each. The subscribed capital of the Company has been fully paid in and has been entered into the Commercial Register of the Registry Agency under the batch file of the Company. Trading in shares issued by the Company is carried out on a regulated securities market, in keeping with the requirements of the Public Offering of Securities Act, the Rules of BSE-Sofia AD and the other applicable legislation. ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 48 Agria Group Holding AD holds 50 000 (fifty thousand) own shares, representing 0.74 % of its capital. During the past 2022, own shares aquired as follows: As of 27.09.2022, Agria Group Holding AD has purchased 50 000 (fifty thousand) of its own shares on a regulated market, representing 0.74% of its capital. Management body The Company has a single-tier management system - Board of Directors . In its capacity of joint-stock company, which has issued shares in the initial share offering, which securities are allowed to be traded on the Regulated market, Agria Group Holding AD has fulfilled its obligation for entry in the Commercial Register under the order of the Commercial Register Act of the fact that the Company is public. The shares of the Company are listed on the Main Market of the Bulgarian Stock Excnage AD, Premium Shares Segment, assigned stock code AGH, ISIN code BG1100085072 Shareholding structure of Agria Group Holding AD as at 31 December 2022 Name/Shareholder’s name Number of shares/votes in GM Percent of capital Emra EOOD, Varna 2 795 500 41.11 % of capital Komers EOOD, Targovishte 1 855 639 27.29 % of capital Svetlomir Iliev Todorov 697 355 10.26 % of capital Other legal entities and natural persons 1 401 506 20.61 % of capital   Agria Group Holding AD Board of Directors Други Investor Relations Director Кристера АД Financial Director Агрия Груп Холдниг АД Executive Director ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 49 2. REVIEW OF THE OPERATIONS AND POSITION OF THE COMPANY As a holding company, AGRIA GROUP HOLDING AD depends on the activities and results of its subsidiaries. The main objective of the Company is to participate in any form in other commercial companies or in their management. The business policy of the Company, including investments, should be considered mainly in terms of the operations of its subsidiaries, because Agria Group Holding AD functions as a legal entity-holding company, carrying out investment activities as managing the stakes it holds in its subsidiaries ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 50 Structure of AGRIA GROUP HOLDING AD Agria Group Holding AD is part of the following economic group EMRA EOOD Agria Group Holding AD OTHERS KOMERS EOOD Kristera AD Korn Trade EOOD Agro EOOD Kristera Agro EOOD A G property Invest EOOD Bora Invest EOOD Bora Energy EOOD Aris Agro EOOD Toni-M EOOD Gruvar EOOD Elit-86 EOOD Diasvet EOOD Terra Protect EOOD BD Agri EOOD BD Farm EOOD Agra EAD Kehlibar EOOD Silk Gas BG EOOD Agro Oil Konsult OOD Korn star OOD Agrivia Oil EOOD ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 51 Agria Group Holding AD holds shares in the capital of the following commercial companies:  Kristera AD, Popovo – 59,554 ordinary registered shares with a par value of BGN 100 each, representing 99.26% of the capital in the company;  Korn Trade EOOD, Varna – 68,000 shares of BGN 100 each, representing 100% of the capital in the company;  Agro EOOD, Varna – 50 shares of BGN 100 each, representing 100% of the capital in the company;  Kristera-Agro EOOD, Devnya – 76,000 shares of BGN 100 each, representing 100% of the capital in the company;  AG Property Invest EOOD, Sofia – 122,050 shares of BGN 100 each, representing 100% of the capital in the company;  Bora Invest EOOD, Varna – 11,000 shares of BGN 100 each, representing 100% of the capital in the company;  Bora Energy EOOD, Varna – 622,000 shares of BGN 10 each, representing 100% of the capital in the company;  Aris Agro EOOD, Varna – 500 shares of BGN 10 each, representing 100% of the capital in the company;  Toni-M EOOD, General Toshevo – 500 shares of BGN 10 each, representing 100% of the capital in the company.  Elit-86 EOOD, Varna - 500 shares of BGN 10 each, representing 100% of the capital in the company.  Gruvar EOOD, Varna – 50 shares of BGN 100 each, representing 100% of the capital in the company.  BD Agri EOOD, Varna - 50 shares of BGN 100,000 each, representing 100% of the capital in the company.  BD Farm EOOD, Varna - 50 shares of BGN 100,000 each, representing 100% of the capital in the company.  Diasvet EOOD, village of Pisanets, Russe region - 100 shares of BGN 50 each, representing 100% of the capital in the company.  Terra Protect EOOD, Sofia – 90,000 shares of BGN 10 each, representing 100% of the capital in the company.  Agra EAD, Varna – 119 545 ordinary registered shares with a par value of BGN 100 each, representing 100% of the capital in the company.  Kehlibar EOOD, Lyaskovets – 7,600 shares of BGN 1,000 each, representing 100% of the capital of the company.  Silk Gas BG OOD – 500 shares of BGN 10 each, representing 55% of the capital of the company.  Agro Oil Konsult OOD - 50,500 shares of BGN 10 each, representing 50% of the capital of the company  Korn Star OOD - 52,200 shares of BGN 10 each, representing 40% of the capital of the company  AgriVia Oil EOOD – 4,000,005 shares of BGN 10 each ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 52 Type of Operations of Agria Group Holding AD Agria Group Holding AD, through its subsidiaries, is engaged in the following types of business: ● Agribusiness in North-Eastern Bulgaria ● Processing industry (storage and processing of grain and oil-bearing cultures) centred in Lyaskovets. ● Trade/export operations near the Port of Varna. Main logistic centers – the towns of Popovo, Devnya and Varna. Besides these main activities, the holding also performs other auxiliary activities - trade in farming fertilisers, plant protection chemicals, fuels and lubricants, sowing seeds by world-renowned companies such as Korteva, Baier, Syngenta, Lima, Grain, BASF, etc. The activity of part of the subsidiaries of Agria Group Holding AD is in the field of agribusiness. The Company’s agribusiness activities include: - Cultivation of agricultural land, production of grain and oil-bearing crops; - Services related to various agronomic techniques. Another type of business the holding is engaged in is processing industry and trade in grain and grain derivatives, including export operations . The total capacity of the storage facilities of Agria Group Holding JSC amounts to approx. 290,000 tonnes. The storage bases of the holding are concentrated in three main logistic centers located in the town of Popovo, town of Devnya and town of Lyaskovets. There also are auxiliary warehouse capacities in the main agribusiness centers of the Company in the town of Targovishte, Yankovo village, Belogradets, Osenets, Town of Kardam, village Rositsa, Town of Provadia, Village Pisanets and Slavyanovo. ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 53 Approx 750,000 – 800,000 tonnes of grain and oil-bearing crops are yearly stored and traded in the holding’s grain facilities. Devnya • The most recent of all storage facilties of the holding is the one located in Devnya, Varna municipilaty, whose constuction dates back to 2007 and currently consists of 12 metal silos and a flat warehouse. Its total storage capacity is 65 000 mt of grain, including wheat, corn, barley, rapeseed and sunflower seed. The storage facility has a key location and is in the immediate vicinity of Hemus Highway and very close to Port Varna West and Port Lesport. The base is equiped with modern laboratory in compliance with EU requirements. Popovo • The warehouse facility, which is a property of Kristera AD, with its storage capacity of 170,000 tons of grain forms the logistic center in the Industrial zone of the town Popovo. A modernly equipped laboratory guarantees the quality of the input and output of the traded grain and oil-bearing crops. Lyaskovets • An enterprise for sunflower seed production is based in the town of Lyaskovets, which is a property to the subsidiary Kehlibar EOOD, having a trade mark of the same name. The company’s trading list includes crude and refined sunflower oil, sunflower husk pallets and sunflower meal. The oil- bearing cultures and grain storage capacity is 20 000 tonnes and the annual processing capacity is 50 000 tonnes. Kehlibar EOOD is certified under the requirements of ISO 22000:2005. Main logistic centers ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 54 The Company has built a mature and effective market structure to procure the incoming raw materials (grain crops), a flexible logistic structure and good positioning of the main locations where grain is stored (grain facilities) near cargo terminals (Port of Varna, Port of Bourgas, Port of Constanta). The closed production cycle, which minimizes the effect of outside factors with regard to purchasing prices and the quality of the main raw materials, and the large quantity of cultivated farmland, including land owned or rented by companies from the holding structure engaging in agribusiness, help to largely secure the foreign trade operations of the company as well. The main clients for the export transactions of the of the Group’s companies are global leaders in grain trade, including Cofco International Romania S.R.L., Cofco International Bulgaria EOOD, ADM Bulgaria Trading EOOD, ADM – Germany, Glencore Agriculture Romania, Cargill Bulgaria, Lecureur France, Dimitriaki S.A. – Greece, Luis Dreyfus Commodities, Ameropa AG, SAIPOL France, Soya Hellas – Greece, Soya Mills- Greece, VAIT Austriaetc, The Andersons INC USA. 3. INFORMATION ABOUT IMPLEMENTED INVESTMENTS PER TYPE OF OPERATION OF AGRIA GROUP HOLDING AD IN 2022 Agribusiness During the financial 2022 the subsidiaries continued the process of expanding their own agricultural land through purchase agreements at a total value of EUR 1,400,000. The lands purchased, which are about 1440 hectares, are located in the regions where the companies cultivate agricultural lands, including the agricultural areas of Veliki Preslav, Varna, Provadia, Vetrino, Dobrich and Smyadovo. The investments implemented in augmentation of capacity, reconstruction and modernization of existing storage facilities in the different agricultural bases of the company amount to a total value of EUR 300,000 for the financial 2022. ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 55 As at the end of 2022, the investments implemented in agricultural machinery are in the amount of EUR 2,570,000. Trade/export The investments implemented in the field of transportation, specifically in expanding the fleet of the company and improving the logistic structure amount to EUR 2,830,000. During 2022, the investments implemented in the construction of a new logistics centre in the region of North- Eastern Bulgaria with a storage capacity of 94,000 m3 amounts to EUR 5,800, 000. By the end of 2022, the investments implemented in the acquisition of assets and shareholdings in legal entities developing activities in the field of agricultural production and processing of grain crops and in the design and construction of real estate amounts to EUR 8,000,000. For the financial year 2022, AGRIA GROUP HOLDING А D has direct investments in the process of execution as follows: Agria Group Holding AD has acquired in the procedure provided by the legislation (by means of a contract for transfer of company shares with notarized signatures and content under Article 129 of the Commercial Law and entry in the Commercial Register) from Vasil Yaroslavov Vasilev the ownership of 100% (one hundred percent) of the capital of the commercial company "AgriVia Oil" EOOD, entered in the Commercial Register and in the register of non-profit organizations at the Registry Agency with UIC 205836122. 4. INVESTMENT PROGRAM FOR 2023 Sources of Financing - The Company plans to finance about 40% of the investment program of Agria Group Holding for 2022 with its own funds. - The remaining part of the investments will be financed with long-term debt financial instruments. - In view of the specialisation of the Company mainly in agribusiness sectors, one source of grants is the European Union in the form of grant schemes for supporting the agricultural producers under the Single payment per area scheme, Payment scheme for agricultural practices beneficial for the climate and environment / ‘green’ direct payments GDP / as well as subsidies under Measure 12 – Natura 2000. Investments per Type of Operations of Agria Group Holding AD Agribusiness  Purchase of farmland in the areas where farming subsidiaries of the holding cultivate farmland. Due to the usual trading activity of the companies in the holding group, specializing in agricultural production, the effect of the land purchasing agreements meets the expectations of the Company referring to fulfilment of the Investment Program for expanding its agricultural lands. The lands purchased are located in regions where the companies are already cultivating agricultural lands which will lead to the consolidation of the total lands cultivated by the companies of the Group. For 2023 the Holding plans investments amounting to EUR 1,500,000. ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 56  Augmentation of capacity, reconstruction and modernization of existing storage facilities in the different agricultural bases of the company. For 2023 the Holding plans investment amounting to EUR 700,000.  Investments in agricultural machinery. For 2023 the company plans investments amounting to EUR 1 500,000. Trade/export operations  The investments planned for 2023 in the field of transportation, specifically in expanding the fleet of the company and improving the logistic structure amount to EUR 1 000,000.  In view of increasing the market presence in North- Eastern Bulgaria as well as strengtening the trading and exporting of the company, in the period 2022-2024 the holding plans to establish a new logistic center in the area, which would have a storage capacity of 94 000m3. Based on inconclusive data the investment amounts to EUR 9,400,000, of which EUR 3,400,000 are planned to be invested in 2023.  Investments in acquisition of assets and shares in legal entities, operating in the field of agricultural production and grain processing of grain. The planned investments for 2023 in the indicated directions from the companies of the holding structure amounts to about EUR 26,000,000. Manufacturing industry  Investment in an oilseed processing plant with service storage silos and oil storage tanks, located on the territory of Kristera AD warehouse, town of Popovo. The planned implementation of the investment project is within 2023-2026. According to preliminary data, its total cost amounts to about EUR 50 million, and for 2023 it is planned to spend funds for the investment in the amount of about EUR 10 000 thousand. The economic policy and business goals of the Company, incl. investments are oriented towards sustainable development and strategic investment planning, operational efficiency and corporate social responsibility, contributing to the stable and sustainable development of the Company and the holding group in economic, social and environmental aspects. The company uses the potential of various ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 57 mechanisms that creates prerequisites for sustainable development of the holding group companies through diversification of the risk of adverse climate change and realization of savings of scale in the direction of agricultural production, on one side and through efficiency and value of new business on the other. Taking into account the parameters of the investment program of the companies in the holding structure as well as the conducted analyses and researches, we believe that the impact of the planned investment would cover the Company’s expectations for optimization of the segment of own grain production as well as strengthening the export orientation of the holding. The parameters of the investment program of the companies in the holding structure have been developped in a situation of a stable market and in managing specific risks for the normal business environment and for the holding group. In compliance with the recommendations of the European Securities and Markets Authority on the impact on financial market and considering the military conflict between Russia and Ukraine, and in compliance with the 3% 6% 12% 57% 22% Planned investments for 2023 Agricultural land Agricultural machinery transportt and logistics Warhouse facilities Acquisitions Mnifacturing industry Agricultural land 1 500 Agricultural machinery, transport and logistics 2 500 Warehouse facilities 5 300 Aquisitions 26 000 Manifacturing industry 10 000 Total planned investments for 2023 (in BGN thousand) 45 300 ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 58 requirements of Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse, the Company undertakes to promptly disclose information on the actual or potential impact of the military conflict on its business, financial and economic position and on its planned investment intentions, as it include a quantitative and qualitative assessment of this impact in its financial reporting information as well as in the form of incidental information. 5. FINANCIAL INDICATORS AND FINANCIAL POSITION OF THE COMPANY OPERATING RESULTS A. Analysis of the financial state on a consolidated basis FINANCIAL CONSOLIDATED REPORT OF AGRIA GROUP HOLDING AD (BGN in thousands) ASSESTS Current period Preceding period EQUITY, MINORITY INTERESTS AND LIABILITIES Current period Precedig period а 1 2 а 1 2 A. NON-CURRENT ASSETS A. EQUITY I. Property, plant, and equipment I. Share capital 1. Land (terrains) 175,539 125,679 Subscribed and paid-up capital, incl.: 6,800 6,800 2. Buildings and constructions 26,028 27,265 ordinary shares 6,800 6,800 3. Machines and equipment 19,956 13,355 preference shares - - 4. Plant - 2,697 Redeemed own ordinary shares (1,390) - 5. Vehicles 8,717 4,412 Redeemed own preference shares - - 6. Fixtures and fittings 20 206 Capital not paid in - - 7. Cost of acquisition and disposal of non-current tangible assets 15,962 3,227 Group I total: 5,410 6,800 8. Other 13,490 12,925 II. Reserves Group I total: 259,712 189,766 1. Premium reserves from securities issues 13,668 13,668 II. Investment property - - 2. Reserve related to subsequent measurement of assets and liabilities 92,487 50,040 III. Biological assets - - 3. Specific reserves, including: 1,918 1,786 IV. Intangible assets general reserves 1,918 1,786 1. Property rights 14 18 specialized reserves 2. Software - 13 other reserves 0 0 3. Development products - - Group II Total: 108,073 65,494 4. Other 97 97 III. Financial result Group IV total: 111 128 1. Accumulated profit (loss), including: retained earnings 103,107 82,652 V. Goodwill accumulated losses ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 59 1. Goodwill 2,326 0 one-off effect of changes in accounting policy 2. Negative goodwill 2. Profit for the current period 68,580 22,837 Group V total: 0 0 3. Loss for the current period VI. Financial assets Group III total: 171,687 105,489 1. Investments in: subsidiaries joint ventures SECTION A TOTAL (I+II+III): 285,170 177,783 associates 10,625 507 other enterprises 9 5 2. Held to maturity - - B. MINORITY INTEREST - 519 government securities - - bonds, including: - - C. NON-CURRENT LIABILITIES municipal bonds - - I. Trade and other payables other investments held to maturity - - 1. Payables to related enterprises - - 3. Other - - 2. Payables under loans received from banks and non-banking fin. institutions 42,664 41,174 Group VI Total: 10,634 512 3. Payables under the Settlement of Uncollectible Loans Act - - VII. Trade and other receivables 4. Trade loans - 145 1. Receivables from related enterprises 5. Loan stock payables - - 2. Trade loan receivables - 0 6. Other 8,234 8,997 3. Financial lease receivables - - Group I total: 50,898 50,316 4. Other 2,097 2,097 Group VII Total: 2,097 2,097 II. Other non-current liabilities 364 396 III. Deferred income VIII. Deferred expenses - - IV. Deferred tax liabilities 8,670 4,712 IX. Deferred tax assets - - V. Financing 777 881 SECTION A TOTAL (I+II+III+IV+V+VI+VII+VIII+IX): 274,880 192,503 SECTION C TOTAL (I+II+III+IV+V): 60,709 56,305 B. CURRENT ASSETS I. Inventory D. CURRENT LIABILITIES 1. Materials 35,486 20,600 I. Trade and other payables 2. Production 5,179 4,218 1. Payables under loans received from banks and non-banking financial institutions 131,269 158,325 3. Merchandise 51,949 84,718 3. Current portion of non- current liabilities 4. Work in progress 16,031 9,206 3. Current liabilities, including: 5. Biological assets - - payables to related enterprises 6. Other - - trade loans 6,654 6,349 Group I total: 108,645 118,742 payables to suppliers and clients 2,547 35,784 ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 60 advances received 2,848 603 II. Trade and other receivables payables to employees 1,730 1020 1. Receivables from related enterprises - - payables to insurance institutions 442 280 2. Receivables from customers and suppliers 35,525 42,228 tax liabilities 3,582 2827 3. Advances to suppliers 25,258 35,256 4. Other 3,043 671 4. Trade loan receivables 33,592 43,570 5. Provisons 5. Court receivables and writs 0 576 Group I total: 152,115 205,859 6. Tax reimbursable 11,403 1445 7. Receivables from employees 128 64 8. Other 3,561 4,133 II. Other current liabilities - - Group II Total: 109,467 127,272 III. Deferred income - - IV. Financing 103 102 III. Financial assets 1. Financial assets held for trading, incl.: - - debt securities - - SECTION D TOTAL (I+II+III+IV): 152,218 205,961 derivatives - - other 2. Available-for-sale financial assets - - 3. Other - - Group III total: - - IV. Cash and cash equivalents 1. Cash in hand 369 488 2. Cash in current accounts 4,179 1,364 3. Restricted amounts 4. Cash equivalents Group IV total: 4,548 1,852 V. Deferred expenses 557 199 SECTION B TOTAL (I+II+III+IV+V) 223,217 248,065 TOTAL ASSETS (A + B): 498,097 440,568 EQUITY, MINORITY INTERESTS AND LIABILITIES (A+B+C+D): 498,097 440,568 1. Analysis of Assets The current assets in the issuer’s balance sheet comprise mainly its available inventory and commercial receivables in subsidiaries. As at 31.12.2022 their consolidated amount is BGN 223,217,000. The non-current consolidated assets as at 31.12.2022 amount to BGN 274,880,000. ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 61 2. Analysis of Liabilities The consolidated equity of the Holding as at 31.12.2022 is BGN 285,170,000. The company completed the reporting period with a profit after tax of BGN 68,580,000. B. Analysis of the Consolidated statement of Comprehensive Income INCOME CONSOLIDATED STATEMENT OF AGRIA GROUP HOLDING AD (BGN IN THOUSAND) EXPENSES Current period Preceding period INCOME Current period Preceding period а 1 2 а 1 2 A. Operating expenses A. Operating income I. Expenses by nature I. Net sales of: 1. Materials 108,535 61,458 1. Production 73,347 50,899 2. External services 21,034 12,571 2. Merchandise 611,217 375,431 3. Depreciation 11,861 10,753 3. Services 6,568 4,495 4. Wages 19,517 12,210 4. Other 7,187 3,221 5. Social and health insurance 2,723 1,851 Group I total: 698,346 434,046 6. Carrying value of assets sold (excluding goods) 463,099 309,547 7. Changes in inventory of finished goods and work-in- progress -7,436 -2,094 II. Income from financing 7,697 6,190 8. Other, including: 7,959 2,966 including government financing 7,697 6,190 impairment of assets 6,760 2,146 provisions - - III. Financial income Group I total: 627,292 409,262 1. Interest income 927 985 2. Dividend income 100 - II. Financial expenses 3. Gains from operations in financial assets and instruments 1,181 216 1. Interest expense 4,059 3,014 4. Gains from changes in foreign currency exchange rates 1,083 - 2. Losses from operations in financial assets and instruments 0 2,724 5. Other - - 3. Losses from changes in foreign currency exchange rates 468 68 Group III total: 3,291 1,201 4. Other 793 752 Group II Total: 5,320 6,558 B. Total operating expenses (I + II): 632,612 415,820 B. Total operating income (I + II + III): 709,334 441,437 ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 62 C. Operating profit 76,722 25,617 C. Operating loss - - III. Share of the profit of associates and joint ventures - - IV. Share of the loss of associates and joint ventures - - IV. Extraordinary expenses - - V. Extraordinary income D. Total expenses (B + III + IV) 632,612 415,820 D. Total income (B + IV + V) 709,334 441,437 E. Pre-tax profit 76,722 25,617 E. Pre-tax loss - - V. Tax 8,142 2,738 1. Corporate income tax for the current period 8,457 2,738 2. Expenses (economy) of deferred corporate income tax -315 - 3. Other - - F. Profit after tax (E - V) 68,580 22,879 F. Loss after tax (E + V) - - incl. for minority interest 0 42 incl. for minority interest - - G. Net profit for the period 68,580 22,837 G. Net loss for the period - - Total (D+ V + F): 709,334 441,437 Total (D + F): 709,334 441,437 Because of the economic activity carried out and the reported income, Agria Group Holding AD closed its accounts as at 31.12.2022 with a positive net result on a consolidated basis of its operations to the amount of BGN 65,580,000. As at 31.12.2022, the equity of the Company on a consolidated basis stand at BGN 285,170,000, and it is the Company’s main source of internal liquidity. Of it, BGN 6,800,000 are subscribed and fully paid in share capital. The table below presents the internal sources of liquidity of the company in accordance with the non- consolidated financial statements. BGN in thousands - on a consolidated basis 31.12.2022 31.12.202 1 Share capital 6,800 6,800 Subscribed capital 6,800 6,800 Capital not paid in - - Shares repurchased (1,390) Reserves 108,073 65,494 Financial result 171,687 105,489 Total equity 285,170 177,783 ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 63 C. Liquidity The liquidity ratios are an indicator of the ability of the company to repay its debts in a timely manner. They are connected with the liquidity risk, which is the risk for the issuer not to have sufficient funds available to meet maturing payables to creditors. The Company manages its assets and liabilities in such a way as to guarantee that it will cover its daily payments regularly and without delay. Cash in hand and in bank deposits as at 31.12.2022 stand at BGN 4,548,000 and is 2.98% of short-term liabilities. The liquidity ratios of Agria Group Holding AD, calculated on the basis of its non-consolidated financial statements, are shown in the following table: Liquidity indicators 31.12.2022 31.12.2021 Current ratio Current assets / current liabilities 1.47 1.20 Quick ratio (Cash + Cash equivalents + Receivables) / Current liabilities 0.75 0.62 Cash ratio (Cash + Cash equivalents) / Current liabilities 0.03 0.01 6. RISKS FACING THE COMPANY. GOALS AND POLICY OF THE COMPANY ON RISK MANAGEMENT The operation of each company is exposed to certain risks affecting its performance. The operation of Agria Group Holding AD is exposed to the risks listed below. The risk factors are listed consequentially in accordance with their significance to the operations of the issuer. A. Specific risks 1. Market risks Market risk is related to the changes in market conditions. It includes income risks, profit risks, interest rate, liquidity and currency risks. 2. Income risks The Company’s future sales are subject to normal market risks. The main future income depends on the possibility for AGRIA GROUP HOLDING AD to perform its market and investment strategy, as well as on the current market situation. To reduce those risks considerably, the Company relies on an increased intra-company capability of effective forecasting and planning, as well as on maintaining stable customer relations.. 3. Profit risks The market risk can also influence the Company’s expenses, particularly in cases when the rate of growth of expenses is faster than that of income. 4. Interest rate risk ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 64 The interest rate risk manifests itself in the possibility of a rise in the cost of financing the Company’s activities. Regarding fixed rate loans, in the case of a potential drop in market interest rates, the issuer may not succeed in obtaining resources at the available lower interest rates. If such circumstances arise, the Issuer would be operating under less advantageous conditions than its competitors. Such development would lead to higher interest payments by the Issuer in comparison to other companies which would finance their activities at the current market rates; consequently, this would lead to lower net profit. Regarding floating rate loans, in the case of a potential drop in market interest levels, the interest rate payable by the Company on its loans will also drop. An interest rate risk for floating rate loans exists in the case of a rise in market levels, when the resources used by the Issuer will become more expensive. In order to minimise the interest rate risk, the Issuer diversifies the sources through which it ensures the financing of its activity. 5. Liquidity risk Liquidity risk is a risk related to the ability for the Issuer to cover its trade payables to suppliers and creditors within the negotiated term and amount of payments. Agria Group Holding AD manages its assets and liabilities in such a way as to guarantee that it will cover its daily payments regularly and without delay. This risk component is minimised by accuracy and commitment in agreements with the trade counterparties with which cash revenue or payments are planned. 6. Currency risk Currency risk is the risk that the Issuer may suffer losses due to the fluctuation of market prices of the various currencies it uses. Agria Group Holding AD carries out its operations predominantly in Bulgarian leva (BGN) and Euro (EUR). The Euro is the main currency in which the Issuer settles its foreign trade relations – sales of goods/produce and purchase of materials necessary for its activity. Under the conditions of a currency board and a fixed rate of the BGN against the EUR, the management of the company consider that the Issuer is not exposed to a significant risk of changes in currency rates. B. Operational risks The chief operational risks and the measures taken to minimise those risks are to be considered in terms of the operations of the Issuer’s subsidiaries, because Agria Group Holding AD functions as a legal entity which is a holding company carrying out investment activities, which aims to manage the stake it holds in its subsidiaries, and which does not directly carry out any other production and/or commercial activity of its own. The operational risk is related to damage or loss suffered by the Company due to human error, technological imprecision, and impossibility for machines and equipment to perform a certain task, or to a mistake in the procedure or organisation. The probability that the Issuer may suffer damage or loss due to human error, technological imprecision, and impossibility for machines and equipment to perform a certain task, or to a mistake in the procedure or organisation via its subsidiaries is insignificant. Part of the chief operational risks is related to a potential load on capacities and to providing the necessary raw materials. Potential risks could arise in relation to the workforce available in the regions where the subsidiaries of the Issuer perform their commercial activities. The operational risk is related to damage or loss suffered by the Company due to human error, technological imprecision, and impossibility for machines and equipment to perform a certain task, or to a ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 65 mistake in the procedure or organisation. The probability that the Issuer may suffer damage or loss due to human error, technological imprecision, and impossibility for machines and equipment to perform a certain task, or to a mistake in the procedure or organisation via its subsidiaries is insignificant. Part of the chief operational risks is related to a potential load on capacities and to providing the necessary raw materials. Potential risks could arise in relation to the workforce available in the regions where the subsidiaries of the Issuer perform their commercial activities. The main risk for the Issuer’s subsidiaries which perform commercial activities related to growing and storing agricultural produce includes inclement weather conditions, diseases and other natural risks. In order to minimise those risks and any potential loss, the subsidiaries obtain insurance policies for all areas on the production in progress of all agro-technical activities against all main risks, together with storm, fire and hail, including insurance policies against freezing of all crops being grown. Insurance policies are obtained for all general risks, including earthquake risk for all real estate and production capacities owned by the companies in the group. Despite the tight competition, the Company considers that it has a competitive edge on the market owing to its experienced management staff and its established reputation. In this respect it should be noted that the management staff and the Company’s employees are highly qualified and motivated specialists, organised in relatively independent active structural units which maintain a maximally complete and up-to-date data base of the development and trends of the respective markets. C. Non-specific (systemic) risks The holding company and its subsidiaries are also exposed to systemic risks, mainly related to the macro environment in which they operate. These risks are not subject to supervision and under the control of Agria Group Holding’s management. The main systemic risk to the activity of the company and its subsidiaries can be identified as the military conflict between Russia and Ukraine, the main exporters of grain worldwide. The outbreak of war has complicated grain and oilseed exports, triggering fears of a food crisis and a high spike in commodity prices in 2022, as well as instability on international markets. Despite the establishment of export corridors from Ukraine and the current soothing of markets, the ongoing military situation threatens to deepen the conflict, which could lead to the restriction or hindrance of exports through the imposition of non-market administrative measures. The Company's management does not anticipate any adverse impact on the results of operations and business processes of the holding company as the Company has no direct exposure to related parties, and/or key customers or suppliers in Russia and Ukraine. Effect on liquidity. The management concludes that there are no liquidity restrictions for the company and the group as a whole in short and medium term. To date, the holding group is supported by global financial institutions with which it works, such as European Investment Bank, DSK Bank, UniCredit Bulbank, UBB AD and etc. 7. CORPORATE SOCIAL RESPONSIBILITY ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 66 The Company follows a consistent policy of Social Corporate Responsibility. Agria Group Holding AD is a public company and its social responsibility finds expression in all aspects of its corporate activities. The management of Agria Group Holding prioritizes environmental protection and people’s health in its corporate policy through its products, services and working conditions. The company’s social engagements in its capacity of employer toward workers and employees find expression in providing safe and healthy working conditions as well as following an environmental protection policy. Agria’s senior management encourages following business standards and practices for public social responsibility regarding the environmental and employee policies. The company assess regularly the impact of its activities on the environment and observe strictly the requirements and regulations for environmental protection, health and safety of the employees and the society in production of grains in the following aspects. Agricultural production is highly dependent on climate change, and at the same time is an important factor, influencing natural and climate conditions. The company has taken the necessary measures and activities to adapt grain production to the changing environment and to have a positive impact on climate change and to promote the sustainable development of agricultural holdings in the holding group. An essential priority of corporate management is environment protection. The company combines social, economic and environmental approaches on the way to achieving sustainable agricultural practices and to the practice of reducing the carbon footprint in grain production. 1. Environmental protection The company develops practices in connection with soil nutrition and production of grains appropriate for particular soil type and adapted to the specifications of the soil. Compliance with the following principles and rules is endorsed when using pesticides.  Use of pesticides’ alternatives; use of selective pesticides, ke eping biodiversity and fighting particular wreckers in particular timeframes taking in account the biology life and development; harvest of alternative crops resistant to wreckers; crop rotations; mechanic weed control.  Staff education for using pesticides, observing the quantities recommended by the producers. Pesticides declared by World Health Organization as dangerous are not used.  Storage in original packages in cool and dry places with active ventilation, which can be isolated and marked with appropriate signs. Mixing and moving pesticide can only be performed by educated staff in places with good lightening and ventilation wearing protective clothing/apparel. The access to the premises where the pesticides are stores is strongly restricted. Assessment of the necessity of crop nutrition is made, balancing utilization of food substances, rotating crop sowing, plowing organic waste in the soil; providing buffer zones around the water sources in order to diminish the loss of food substances. In order to prevent loss of genetic resources and in view of providing biodiversity are used plant waste of previous crops for nutritious soil preparation; observation of keeping the eco systems; certified seeds are used. ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 67 Investments are being made in innovative agricultural machinery, equipped with smart farming software to reduce the use of pesticides and fertilizers. Agricultural equipment for harvesting of cereals is provided with devices for uniform dispersion of the crop residues which are plowed into the soil and thus recovering part of the nutrients in the soil horizon. Burning of vegetable waste is not performed, the use of nitrates is reduced. 2. Health and safety of the staff The company follows a consistent policy in order to minimize the risks of:  Physical danger – by qualified and experienced staff for the use of machinery and motor vehicles.  Work in closed spaces – silos, water basins, etc. The access to them is strongly restricted and it is allowed under the supervision of educated staff.  Chemical danger in case of contact with pesticides – a training is conducted for work with pesticides; following the hygiene and safety practices.  Fire and explosions risks – precautions are taken about minimizing the risk of fire in the warehouses for grain storage by using modern and quality production capacity and qualified and experienced staff.  Risk of spread of viruses and infections – the corporate management take precautions and solutions to safeguard the health of the employees and to prevent and limit the spread of viruses and infections. 8. REQUIREMENTS OF THE ACCOUNTANCY ACT FOR DRAWING UP AND PUBLISHING NON-FINANCIAL DECLARATION Requirements of the Accountancy Act for drawing up and publishing non-financial declaration and consolidated non-financial declaration by large enterprises which are public-interest entities in which the average number of employees exceeds 500 for the reporting period. According to the provisions of the Accountancy Act, when enterprises and parent companies of enterprise groups meet certain requirements and criteria, they should draw up and present a non-financial declaration as part of the annual report for the financial year. In particular, the requirements of the law in relation to non- financial declaration are as follows: “ Art. 41. Large enterprises which are public interest enterprises and which, at 31 December of the reporting period, exceed the criterion of the average number of employees during the financial year of 500 people, shall include a non-financial declaration under Article 48 in their report on the operations. ” The Accountancy Act defines criteria for categorization of the enterprises (art. 19) and group of enterprises (art. 21). In addition, according to provision § 4 of the additional provisions of the act, “ Public interest enterprises for ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 68 the purposes of this Act shall be treated as large enterprises, with the exception of the applicable accounting basis, regardless of the book value of the assets, the net sales revenue and the average number of employees. ” Agria Group Holding AD is a public company which transferable securities – shares are admitted to trading and are traded on a regulated security market. In this capacity, according to the text of § 1 , item 22 of the Additional provisions of the Accountancy Act (the act), for the purpose of the applicable basis of the act, the company is deemed an enterprise of public interest (Public Interest Enterprise). In 2022, on a consolidated basis, the company has the following indicators: - Book value of the assets: BGN 508,773,000; - Net sales revenue: BGN 725,813,000, and - Average number of employees (for the reporting year): 485 people. Although the company does not cover the requirements based on quantitative criteria according to the Accountancy Act, for the purpose of application scope of the law and in relation to the requirements for annual closure of accounts for 2022, Agria Group Holding should be considered a large enterprise . In 2022, on a consolidated basis, the group has the following preliminary indicators: - Book value of the assets: BGN 508,773,000; - Net sales revenue: BGN 725,813,000, and - Average number of employees (for the reporting year): 485 people. For the purposes of the application, scope of the Act and in relation to the requirements of annual reporting for 2022, at a group level Agria Group Holding should be deemed a large group . Applicability of the requirements of the Accountancy Act for preparing and publishing non-financial declaration and consolidated non-financial declaration by Agria Group Holding AD as part of the annual reporting for 2022 on a consolidated and consolidated basis. The requirements, which the Accounting Act prescribes in order to assess whether the requirement for preparation and publishing a non-financial declaration is applicable, are cumulative, namely:  The enterprise/Parent company in a large group/ to be a Public Interest Enterprise and to be a large enterprise/accordingly large group;  As at 31 December (of the corresponding year for which is assessed the presence or absence of a legal obligation) to exceed on an individual, respectively on a consolidated basis, the criteria for average number of employees 500 people. In 2022 on a non-consolidated basis, the company has a number of employees – 8 people, on a consolidated basis – 485 people. Therefore, there is no legal cumulative requirement, respectively as long as the requirements of the law are not covered at an individual and consolidated level (Art. 41, Art. 51), Agria Group Holding AD is not obliged to prepare and publish as part of the individual and consolidated activity report for 2022, non-financial declaration. ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 69 9. IMPORTANT EVENTS FOR AGRIA GROUP HOLDING AD THAT TOOK PLACE IN THE 2022 FINANCIAL YEAR DATE EVENT 31.12.2022 1. Agria Group Holding AD has generated consolidated income in the amount of BGN 698,346 thousand which represents 160.89% of the revenues for 2021. 2. Realized profits on a consolidated basis for 2022 amount to BGN 65,580 thousand. 3. The company’s equity on consolidated basis as at 31.12.2022 is BGN 285,170 thousand and it is with BGN 107,387 thousand more compared to 2021. 23.12.2022 The Company has disclosed INSIDE INFORMATION under art. 7 of regulation No596/2014 of the european parliament and the council from 16 april 2014 and in the scope of the exemplary list of facts and CIRCUMSTANCES SUBJECT TO DISCLOSURE IN ACCORDANCE WITH APPENDIX No4 TO ART. 12, PARA 1, ITEM 1 OF ORDINANCE No2 OF FSC with the following content: At a meeting of the Board of Directors of BSE AD held on Minutes No. 81/21.12.2022, the following resolutions were adopted: 1.Pursuant to Article 33, Par. 8 of Part III of the Rules for Admission to Trading, accepts for trading on the BSE Main Market, "Premium" share segment, the shares issued by Agria Group Holding AD Varna, stock code AGH, ISIN code BG1100085072, as of 03.01.2023 (Tuesday). 2.Pursuant to Article 43 of Part III of the Rules for Admission to Trading of the Rules of Procedure of the BSE, the Board of Directors of the BSE shall terminate the registration of the issue of shares issued by Agria Group Holding AD-Varna, stock code AGH, ISIN code BG1100085072, on the "Standard" Share Segment of the BSE Main Market as of 03.01.2023 (Tuesday). 25.11.2022 The company presented quarterly consolidated report for the thirth quarter of 2022 to the FSC, BSE-Sofia AD and the public. 17.11.2022 Agria Group Holding AD concluded a sale-purchase contract of 441,866 ordinary registered dematerialised shares with voting rights from Almagest AD capital, entered in the Commercial Register and in the Register of Legal Entities at the Registry Agency with UIC 175340142, with a nominal value of 80 each, representing 100% of the capital of Almagest AD. Acquisition of the ownership right to 100% of the shares of the capital of Almagest AD is performed according to the procedure stipulated by the legislation and the Articles of Association of Almagest AD and after obtaining a resolution from the Commission on Protection of Competition authorizing the sale of the shares by the seller to the buyer. The shares are transferred to the buyer "Agria Group Holding"AD free of any obligations, encumbrances, rights and claims of third parties, together with all rights arising from or related to them. Almagest AD is developing activities in the field of storage, processing of crops (corn and wheat) for the production of bioethanol used as a substitute for gasoline fuel in internal combustion engines and for the food industry and in the field of trade in grain seeds and ethanol ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 70 produced from them. The production and trade of oilseed grains and vegetable oils are within the scope of Agria Group Holding's business lines as part of the holding's business model. An investment in the acquisition of the shares of the capital of Almagest AD suggests the potential for market presence of Agria Group Holding AD in the market of renewable energy sources (bioethanol), denatured ethanol and DDGS, for the expansion of the regional positioning of the company in different regions of the country and for business practices of synergy with the other business lines of the companies of the holding structure. The nature of such an investment would lead to long-term security and sustainability of the company's business model, better cash flow rhythmicity and value addition on a group level, in parallel with investments in the agribusiness and grain trading sectors. The future transaction is ensurig the implementation of part of the investment program of the holding in the direction of strengthening Agria Group Holding's presence in the renewable energy market, which is within the scope of the holding's business lines, in accordance with the long-term development strategy. Combining the business potential of Agria Group Holding AD and Almagest AD, would be representing a sustainable foundation for future successful growth and diversification of the business lines developed by the company. There are no related and/or interested parties involved in the future transaction. The transaction does not fall within the scope of Article 114(1) of the Securities Act, as this type of transaction, in accordance with the scope of activity of Agria Group Holding AD, in line with the provision of Article 114(10) of the Securities Act, is in the ordinary commercial activity, representing the sum of actions and transactions performed by the company within the scope of its business activity and in accordance with the ordinary commercial practice. 26.10.2022 The company presented quarterly non-consolidated report for the third quarter of 2022 to the FSC, BSE-Sofia AD and the public. 11.10.2022 The Company has disclosed INSIDE INFORMATION under art. 7 of regulation No596/2014 of the european parliament and the council from 16 april 2014 and in the scope of the exemplary list of facts and CIRCUMSTANCES SUBJECT TO DISCLOSURE IN ACCORDANCE WITH APPENDIX No4 TO ART. 12, PARA 1, ITEM 1 OF ORDINANCE No2 OF FSC with the following content: As a result of research and preliminary negotiations between Agria Group Holding AD and the owners of the capital of Almagest AD with UIC 175340142, Agria Group Holding AD has made an offer to acquire the ownership of 441,866 ordinary registered dematerialised shares with voting rights representing 100% of the capital of Almagest AD, which has been confirmed by the holders of the shares. Almagest AD is developing activities in the field of storage, processing of crops (corn and wheat) for the production of bioethanol used as a substitute for gasoline fuel in internal combustion engines and for the food industry and in the field of trade in grain seeds and ethanol produced from them. The production and trade of oilseed grains and vegetable oils are within the scope of Agria Group Holding's business lines as part of the holding's business model. An investment in the acquisition of the shares of the capital of Almagest AD suggests the potential ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 71 for market presence of Agria Group Holding AD in the market of renewable energy sources (bioethanol), denatured ethanol and DDGS, for the expansion of the regional positioning of the company in different regions of the country and for business practices of synergy with the other business lines of the companies of the holding structure. The nature of such an investment would lead to long- term security and sustainability of the company's business model, better cash flow rhythmicity and value addition on a group level, in parallel with investments in the agribusiness and grain trading sectors. Following the successful completion of negotiations and an empowering decision by the corporate management of Agria Group Holding AD, a deal is to be concluded for the acquisition of ownership of 441,866 ordinary registered dematerialised shares with voting rights representing 100% of the capital of Almagest AD. A possible future transaction would ensure the implementation of part of the investment program of the holding in the direction of strengthening Agria Group Holding's presence in the renewable energy market, which is within the scope of the holding's business lines, in accordance with the long-term development strategy. Combining the business potential of Agria Group Holding AD and Almagest AD, would be representing a sustainable foundation for future successful growth and diversification of the business lines developed by the company. There are no related and/or interested parties involved in the future transaction. The transaction does not fall within the scope of Article 114(1) of the Securities Act, as this type of transaction, in accordance with the scope of activity of Agria Group Holding AD, in line with the provision of Article 114(10) of the Securities Act, is in the ordinary commercial activity, representing the sum of actions and transactions performed by the company within the scope of its business activity and in accordance with the ordinary commercial practice. 01.10.2022 – 31.12.2022 Pursuant to the planned construction of a new logistics center of the holding in the region of Northeast Bulgaria within 2022-2023, in order to increase the market presence and strengthen the company's trade and export activities in the period covering the fourth quarter of 2022, Silk Gas BG EOOD, a subsidiary of Agria Group Holding AD, has performed investment project activities, obatined construction permits, entered into subcontracts and commenced construction and installation works for the construction of a silo facility with access to the republican railway network to improve the logistics of loading goods. 01.10.2022 – 31.12.2022 Pursuant to the Investment Program of the companies in the holding group, during the fourth quarter of 2022, the subsidiaries of Agria Group Holding AD continued the process of expanding their own agricultural land through purchase agreements. The lands purchased are located in the regions where the companies are already cultivating agricultural lands. Due to the usual trading activity of the companies in the holding group, specializing in agricultural production, the fulfilment of the Investment Program of the holding for expanding its agricultural lands leads to consolidation of the total agricultural lands cultivated by the companies in the Group. ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 72 01.10.2022 – 31.12.2022 During the fourth quarter of 2022, Kehlibar EOOD, a subsidiary of Agria Group Holding AD, handled transactions related to its usual business activities of storing, processing and trading in grain crops and oilseeds and products thereof. During the fourth quarter of 2022, Agrvia Oil EOOD, a subsidiary of Agria Group Holding AD, handled transactions related to its usual business activities of storing, processing and trading in grain crops and oilseeds and products thereof. 01.10.2022 – 31.12.2022 During the fourth quarter of 2022, Kristera AD, a subsidiary of Agria Group Holding AD, handled transactions related to its usual business activities of storing and trading in grain crops and oilseeds and products thereof. 01.10.2022 – 31.12.2022 During the fourth quarter of 2022, Kristera-Agro EOOD, Agro EOOD, Aris Agro EOOD, Toni-M EOOD, Elit-86 EOOD, Gruvar EOOD, Diasvet EOOD, BD Agri EOOD, BD Farm EOOD and Agra EAD, subsidiaries of Agria Group Holding AD, handled transactions related to their usual business activities of producing and trading in grains. 01.10.2022 – 31.12.2022 During the fourth quarter of 2022, Korn Trade EOOD, subsidiary of Agria Group Holding AD, handled transactions related to the export of grain crops with counterparties in the EU. 28.09.2022 The company has presentd to the Financial Supervision Commission (FSC), the Bulgarian Stock Exchange AD (BSE) and the public a notice of repurchased its own shares as of 27.09.2022 as follows: As of 27.09.2022 Agria Group Holding AD has repurchased 50 000 (fifty thousand) company shares on a regulated market, representing 0.74% of its capital. 26.09.2022 The company has presentd to the Financial Supervision Commission (FSC), the Bulgarian Stock Exchange AD (BSE) and the public a notice concerning the repurchased its own shares up to 50 000 (fifthy thousand) ordinary company shares on a regulated market with starting date as of 27.09.2022. The order for repurchasing is given to Elana Trading AD. 21.09.2022 An increase of the capital of Tera Protekt EOOD from BGN 300,000 to BGN 900,000 was registered in the Commercial Register through the subscription of 60,000 new shares with a value of BGN 10 each, the new capital shares has being acquired by the sole owner of the capital of Agria Group Holding AD. 08.09.2022 A decision was adopted to increase the capital of Tera Protekt EOODfrom BGN 300,000 to BGN 900,000, or by an amount of BGN 600,000, by subscribing for 60,000 new shares of BGN 10 each, with the new shares of the capital to be fully subscribed by the sole owner of the capital, Agria Group Holding AD. The sole owner of the capital "Agria Group Holding "AD has paid the full amount of the capital increase by making an actual payment into the current bank account of "Tera Protekt "EOOD. "Agria Group Holding" AD subscribed and acquired the new 60 000 shares of 10 BGN each for a total value of 600 000 BGN. As a result of the increase, the capital of "Tera Protekt "EOOD amounts to a total of BGN 900,000, divided into 90,000 shares of BGN 10 each. 18.08.2022 The company presented a half-yearly consolidated report for the first half of 2022 to the FSC, BSE-Sofia AD and the public. 11.08.2022 On 11 th August 2022, the increase of the capital of "AgriVia Oil" EOOD was entered in the Commercial Register and in the Register of Legal Entities at the Registry Agency from BGN 5 to BGN 4,000,005 or in the amount of BGN 4,000,000, by subscribing new 4,000,000 shares worth BGN 1 each , with the new ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 73 shares of the capital being aquired entirely by the sole owner of the capital "Agria Group Holding" AD. "Agria Group Holding" AD has subscribed and acquired the new 4,000,000 shares worth BGN 1 each for a total value of BGN 4,000,000. As a result of the increase, the capital of "AgriVia Oil" EOOD amounts to a total amount of BGN 4,000,005, divided into 4,000,005 shares of BGN 1 each. 25.07.2022 The company presented a half-yearly non-consolidated report for the first half of 2022 to the FSC, BSE-Sofia AD and the public. 25.07.2022 On 25th July 2022 Agria Group Holding AD was entered in the Commercial Register and in the Register of Legal Entities at the Registry Agency as the sole owner of the capital of AgriaVia Oil ЕОО D. 19.07.2022 On 19th July 2022, Agria Group Holding AD declared dividend income from Agria Group Holding AD's subsidiary Kristeria-Agro EOOD in the amount of BGN 4 000 000. 13.07.2022 Agria Group Holding AD has concluded a contract for the acquisition in the procedure provided for by the legislation (through a contract for the transfer of company shares with notarized signatures and content under Article 129 of the Commercial Law) of the ownership of 100% of the shares of the capital of the trading company AgriVia Oil ЕООD developing activities in the field of trade in grain oilseeds and vegetable oils. The production and trade of grain oilseeds and vegetable oils are within the scope of Agria Group Holding AD's activities as part of the holding's business model. The nature of such an investment would lead to long-term cash flow security, sustainability, and profitability at a group level, in line with investments in the agribusiness and grain-trading sector. The transaction ensures the implementation of part of the investment program of the holding in the direction of strengthening the processing and export orientation of the company in line with the long-term development strategy. Combining the business potential of Agria Group Holding AD and AgriVia Oil EOOD in the direction of trade and logistics of bulk grain (oilseed grains) and vegetable oils, represents a sustainable foundation for future successful development and diversification of the business lines developed by the company. The Company has disclosed on 13 July 2022 INSIDE INFORMATION about the transaction pursuant to Article 7 of Regulation No 596/2014 of the European Parliament and of the Council of 16 April 2014 and within the scope of the indicative list of facts and circumstances subject to disclosure pursuant to Annex 4 to Article 12, paragraph 1, item 1 of Regulation No 2 of the FSC. 01.07.2022 On 1st July 2022 Agria Group Holding AD has disclosed to the Financial Supervision Commission, Bulgarian Stock Exchange-Sofia AD and Central Depository AD a cash dividend notification containing the terms and conditions for the payment of dividend for 2020 and for 2021 as follows, adopted a resolution to distribute the Company's net profit for 2021 amounting to BGN 2 086 000.43 as a cash dividend to the shareholders, together with a part of the Company's undistributed net profit for 2020 amounting to BGN 413 999.57, the total amount of the dividend being BGN 2 500 000.00. The persons registered in the records of the Central Depository as being entitled to receive the dividend as ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 74 at the 14th day following the date of the General Meeting, namely 12 July 2022, shall be entitled to receive the dividend for 2020 and 2021. Gross dividend per share - BGN 0.3676471. Net dividend per share for individual shareholders after deduction of 5% tax - BGN 0.3492647. Selected commercial bank for dividend payment - UniCredit Bulbank AD. Starting date for payment of the dividend - 15 August 2022. The dividend will be paid as follows: for shareholders with customer accounts opened with investment intermediaries - through the respective investment intermediary; for shareholders without accounts with investment intermediaries - through the branches of UniCredit Bulbank AD in the country until 29 December 2022. 01.07.2022 - 30.09.2022 Pursuant to the Investment Program of the companies in the holding group, during the third quarter of 2022, the subsidiaries of Agria Group Holding AD continued the process of expanding their own agricultural land through purchase agreements. The lands purchased are located in the regions where the companies are already cultivating agricultural lands. Due to the usual trading activity of the companies in the holding group, specializing in agricultural production, the fulfilment of the Investment Program of the holding for expanding its agricultural lands leads to consolidation of the total agricultural lands cultivated by the companies in the Group. 01.07.2022 - 30.09.2022 During the thirth quarter of 2022, Kehlibar EOOD, a subsidiary of Agria Group Holding AD, handled transactions related to its usual business activities of storing, processing and trading in grain crops and oilseeds and products thereof. 01.07.2022 - 30.09.2022 During the thirth quarter of 2022, Kristera AD, a subsidiary of Agria Group Holding AD, handled transactions related to its usual business activities of storing and trading in grain crops and oilseeds and products thereof. 01.07.2022 - 30.09.2022 During the thirth quarter of 2022, Kristera-Agro EOOD, Agro EOOD, Aris Agro EOOD, Toni-M EOOD, Elit-86 EOOD, Gruvar EOOD, Diasvet EOOD, BD Agri EOOD, BD Farm EOOD and Agra EAD, subsidiaries of Agria Group Holding AD, handled transactions related to their usual business activities of producing and trading in grains. 01.07.2022 - 30.09.2022 During the thirth quarter of 2022, Korn Trade EOOD, subsidiary of Agria Group Holding AD, handled transactions related to the export of grain crops with counterparties in the EU. 30.06.2022 The Company has presented the minutes of the Ordinary General Meeting of Shareholders of Agria Group Holding AD Varna held on 28 June 2022 to the FSC, BSE-Sofia and the public. 28.06.2022 Ordinary General Meeting of shareholders of Agria Group Holding AD, Varna was held and the following resolutions were passed: 1. The General Meeting approves the audited annual financial statement of the Company for 2021, prepared in accordance with Delegated Regulation (EU) 2019/815 and submitted to the Financial Supervision Commission (FSC), Bulgarian Stock Exchange AD (BSE) and the public. 2. The General Meeting approves the Audited annual consolidated activity report of the Company for 2021, prepared in accordance with Delegated Regulation (EU) 2019/815 and submitted to the Financial Supervision Commission (FSC), Bulgarian Stock Exchange AD (BSE) and the public. 3. The ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 75 General Meeting of Shareholders adopts a resolution to distribute the Company's generated net profit for 2021 amounting to BGN 2 086 000.43 as a cash dividend to the shareholders, together with a part of the Company's undistributed net profit for 2020 amounting to BGN 413 999.57, as the total amount of the dividend amounts to BGN 2 500 000.00. The persons entitled to receive dividend should be entered in the registers of the Central Depository as holders of dividend rights as of the 14th day following the General Meeting at which the Annual Financial Statements and the resolution on the distribution of profits are adopted. The General Meeting of Shareholders authorizes the Board of Directors of the Company to take all necessary factual and legal actions regarding the dividend pay-off, including selection of servicing bank, the initial and final date for the payment of the dividend. 4. The General Meeting discharges from liability the members of the Board of Directors of the Company with regard to their activity in 2021. 5. The General Meeting approves the report of the Investor Relations Director of the Company for 2021. 6. The General Meeting approves the report on the activity of the Auditing Committee of the Company for 2021. 7. The General Meeting passes a resolution for election of the Audit Committee of Agria Group Holding AD in the following composition: Simeon Parvanov Milev, Svetla Valentinova Gancheva and Milena Ivanova Gigova. 8. The General Meeting determines a mandate of 1 year for the Audit Committee of Agria Group Holding AD and remuneration of its members as follows: monthly remuneration for The Chairman of the Audit Committee amounting to BGN 1300 and monthly remuneration for all the members of Audit committee amounting to BGN 500. 9. The General Meeting passes a resolution for election of a registered auditor of the Company for 2022 in accordance with the proposal presented by the Auditing Committee namely: Audit company „Primorska Audit Company“ OOD, entered into the register under Art.20 of IFAA, having number 086, lead auditor – Marian Nikolov, Certified Public Accountant, registered auditor, entered into the register under Art.20 of IFAA, having number 061.” 10. The General Meeting approves the report on the implementation of the Policy for remuneration of the members of the Board of Directors of Agria Group Holding AD for 2021. 11. The General Meeting of Shareholders passes a resolution for buy- back of Company’s own shares under the following conditions: Number of shares subject to buy-back – up to 3% of the total voting shares, issued by the company or up to 204 000 shares. – Minimum buy-back price – BGN 28.00 – Maximum buy-back price – BGN 33.00 – Initial date of buy-back – 30th June 2022 – Final date of buy-back – not later than 30th June 2023 – Payment term of buy-back shares – according to the legislation in force. The General Meeting of Shareholders authorizes the Board of Directors to conduct unlimited procedures for buy-back during the buy-back period; in the term of each procedure, depending on the market conditions, to change under their discretion the buy-back price within the price limits set by the General Meeting of shareholders; to determine an investment broker who shall be ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 76 assigned to proceed the buy-back order; to determine all remaining parameters of the buy-back and take all necessary factual and legal actions pursuant to the resolution of the General Meeting. Buy-back goal – increase in the liquidity of the Company’s shares; 12. The General Meeting of Shareholders authorizes the Board of Directors of the Company to determine additional remuneration for 2021 for the members of the Board of Directors to a total amount of BGN 500 000 and to distribute additional remuneration to the members of the Board of Directors in the voted amount, in compliance with the approved Remuneration Policy for the members of the Board of Directors of Agria Group Holding AD. 14.06.2022 The Company determined the circle of members with voting rights in The Ordinary General Meeting of Shareholders, scheduled for 28 June 2022 on the basis of a list / book of shareholders of the Company, presented by the Central Depository. 25.05.2022 The company presented a quarterly consolidated report on the first quarter of 2022 to the FSC, BSE-Sofia AD and the public. 20.05.2022 The company presented an invitation for the Ordinary General Meeting of shareholders of Agria Group Holding AD on 28 June 2022 to the FSC, BSE-Sofia AD and the public. 20.05.2022 The company presented an invitation for the Ordinary General Meeting of shareholders of Agria Group Holding AD on 28 June 2022 and the General Meeting materials to the FSC, BSE-Sofia AD and the public. 03.05.2022 The Company presented an annual consolidated report for 2021 prepared in accordance with Delegated Regulation (EU) 2019/815 of the Financial Supervision Commission (FSC), the Bulgarian Stock Exchange AD (BSE) and the public. 29.04.2022 The company presented a quarterly non-consolidated report for the first quarter of 2022 to the FSC, BSE-Sofia AD and the public. 13.04.2022 On 13th of April 2022, Agria Group Holding's subsidiary Bora Energy Ltd. acquired the ownership of 20,000 ordinary registered shares with voting rights, representing 1/3 of the capital of Energy Solar Technologies Ltd., developing activity in field of renewable energy production through the utilization of solar energy by investing in solar parks. Investments in renewable energy projects is within the scope of the business lines of Agria Group Holding JSC, as part of the holding's business model. Investments in renewable energy projects is within the scope of the business lines of Agria Group Holding JSC, as part of the holding's business model. The ownership acquisition of the shares is executed in accordance to the required legislation procedure, by means of a giro of the temporary certificates representing the shares and entry in the shareholders register. The nature of such investment would lead to long-term cash flow security and sustainability as well as profitability on a group level, in line with investments in the agribusiness and grain trading sectors. 07.04.2022 On 7th of April 2022, in the Commercial Register and in the Register of Legal Entities at the Registry Agency, the following changes were entered in the account of the subsidiary of Agria Group Holding AD Korn Security Ltd: ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 77 1.Increase of the capital of Korn Security LTD. from BGN 5,000 to BGN 12,205,000 or with the amount of BGN 12,200,000, by subscription of 122,000 new shares of BGN 100 each, the new shares of the capital being fully assumed by the sole owner of the capital Agria Group Holding JSC. 2.The former manager of Korn Security Ltd., Ilko Hristov Iliev, has been erased and Emil Veselinov Raykov, who has been elected and empowered as manager to represent the company, was registered. 3.The company name has been changed from Korn Security Ltd. to AG Property Invest Ltd. 06.04.2022 On 6th of April 2022, in the Commercial Register and in the Register of Legal Entities at the Registry Agency, was registered the transfer of the commercial company ZKPU "VEDRINA" with its registered administration and management address in the village of Vedrina, Dobrich Municipality, Dobrich Region, as a set of rights, obligations and factual relations within the meaning of Article 15 of the Commercial Law to the subsidiary of Agria Group Holding AD company Korn Star Ltd. 31.03.2022 – 30.06.2022 In the period covering the second quarter of 2022, Agria Group Holding AD recorded dividend income from Agria Group Holding AD subsidiaries (Korn Trade Ltd, Amber Ltd, Agro Ltd, BD Agri Ltd, BD Farm Ltd, Tony-M Ltd, Agra EAD, Kristera Plc) in the total amount of BGN 29,000 thousand. 01.01.2022 – 30.06.2022 Pursuant to the Investment Program of the companies in the holding group, during the first half of 2022, the subsidiaries of Agria Group Holding AD continued the process of expanding their own agricultural land through purchase agreements. The lands purchased are located in the regions where the companies are already cultivating agricultural lands. Due to the usual trading activity of the companies in the holding group, specializing in agricultural production, the fulfilment of the Investment Program of the holding for expanding its agricultural lands leads to consolidation of the total agricultural lands cultivated by the companies in the Group. 31.03.2022 The subsidiary of Agria Group Holding AD, Korn Star LTD., concluded a contract for acquiring the right of ownership of the trading company ZKPU “Vedrina”, with headquarters and management address in the village of Vedrina, Dobrich Municipality, Dobrich Region, as a set of rights, obligations and factual relations within the meaning of Article 15 of the Commercial Law. The agreement is in line with the structure and scale of Agria Group Holding's investments, as well as with the holding's growing potential for development in production of grain and trading. The purpose of the acquisition of the trading company is orientated towards the optimization of the processes of structuring the farmland properties by territories, consolidation of the total cultivated farmlands and right positioning of the farms with the scope of the territory in which the companies of the Holding develop commercial activity, which is a main priority in the strategy for development of the Group and is a next step to improving the structure of the production, supply and trade in grains. 29.03.2022 The subsidiary of Agria Group Holding JSC, Korn Security Ltd., acquired the ownership of 10 031 430 ordinary registered shares with voting rights, ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 78 representing 50% of the capital of the trading company AB INVESTMENTS GROUP JSC, developing activity in acquisition of real estate investments with exclusive locations. The ownership acquisition of the shares is executed in accordance with the required legislation procedure, by means of a giro of the temporary certificates representing the shares and entry in the shareholders register. The transaction is in line with the Company potential to create additional value by generating new business strands in the operations of the holding companies. The nature of such investment would lead to long-term cash flow security and sustainability as well as profitability on a group level, in line with investments in the agribusiness and grain trading sectors. 25.03.2022 The Company presented an annual non-consolidated report for 2021 to the FSC, BSE-Sofia AD and the public. 16.03.2022 The transfer of 45% (forty-five percent) of the share capital of Silk Gas BG OOD to Agria Group Holding JSC have been entered in the Commercial register and register of NPLE at the Registry Agency. Silk Gas BG has been transformed from a limited liability company to a sole-owned limited liability company with sole owner of the capital Agria Group Holding JSC. 28.02.2022 The company presented a quarterly consolidated report for the fourth quarter of 2021 to the FSC, BSE-Sofia AD and the public. 28.01.2022 The company presented a quarterly non-consolidated report for the fourth quarter of 2021 to the FSC, BSE-Sofia AD and the public. 01.01.2022- 31.03.2022 During the first quarter of 2022, Agria Group Holding AD has generated dividend income of BGN 500,000 from the subsidiary Korn Trade EOOD, BGN 5,400,000 from the subsidiary “Kristera- Agro” EOOD and BGN 6,300,000 from the subsidiary Kristera AD. 01.01.2022- 31.03.2022 Pursuant to the Investment Program of the companies in the holding group, during the first quarter of 2022, the subsidiaries of Agria Group Holding AD continued the process of expanding their own agricultural land through purchase agreements. The purchased lands are located in the regions where the companies are already cultivating agricultural lands. Due to the usual commercial activity of the companies in the holding group, specializing in agricultural production, the fulfilment of the Investment Program of the holding for expanding its agricultural lands leads to consolidation of the total agricultural lands cultivated by the companies in the Group. 01.01.2022 – 30.06.2022 During the first half of 2022, Kehlibar EOOD, a subsidiary of Agria Group Holding AD, handled transactions related to its usual business activities of storing, processing and trading in grain crops and oilseeds and products thereof. 01.01.2022 – 30.06.2022 During the first half of 2022, Kristera AD, a subsidiary of Agria Group Holding AD, handled transactions related to its usual business activities of storing and trading in grain crops and oilseeds and products thereof. 01.01.2022 – 30.06.2022 During the first half of 2022, Kristera-Agro EOOD, Agro EOOD, Aris Agro EOOD, Toni-M EOOD, Elit-86 EOOD, Gruvar EOOD, Diasvet EOOD, BD Agri EOOD, BD Farm EOOD and Agra EAD, subsidiaries of Agria Group Holding AD, handled transactions related to their usual business activities of producing and trading in grains. 01.01.2022 – 30.06.2022 During the first half of 2022, Korn Trade EOOD, subsidiary of Agria Group Holding AD, handled transactions related to the export of grain crops with counterparties in the EU. ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 79 10. INFORMATION ON LARGE TRANSACTIONS ENTERED INTO BETWEEN RELATED PARTIES IN 2022 During the 2022 financial year Agria Group Holding AD entered into no large transactions with related parties, with the exception of ordinary economic activity transactions. 11. INFORMATION UNDER ART. 187E AND ART. 247 OF THE COMMERCIAL ACT The Company owns 50 000 (fifty thousand) of its own shares representing 0.74% of its capital. Own shares were acquired during the past 2022, as follows: As of 27.09.2022 "Agria Group Holding" AD has purchased 50 000 (fifty thousand) own shares on a regulated market, representing 0.74% of its capital. Names, functions, remuneration and equity held in other companies of the members of the management and supervisory body Agria Group Holding AD, Varna, has a single-tier management system and is managed and represented by a Board of Directors, which operates under the supervision of the General Meeting. The remunerations of the members of the Board of Directors are determined in accordance with the Remuneration Policy for the members of the Board of Directors of Agria Group Holding AD approved by the General Meeting of Shareholders. Agria Group Holding AD pays the members of the Board of Directors a regular remuneration which is approved by the General Meeting of Shareholders of the company, taking into account the obligations and the contribution of each members of the Board of Directors to the activity and the results of the company , as well as the opportunity recruit and retain qualified and loyal members of the Board of Directors and compliance of the interests of the members of the Board of Directors with the long-term interests of the Company to coincide. In view of the financial and economic standing of the Company and the certain input of the members of the Board of Directors of AGRIA GROUP HOLDING AD, during the reporting 2022 the members of the Board of Directors received fixed remunerations, which certain amount was approved by the General Meeting of Shareholders of the Company. The amount of the permanent monthly remuneration of the members of the Board of Directors, until the date of the resolution from Ordinary the General Meeting of Shareholders of AGRIA GROUP HOLDING AD,held on 29 th June 2021 is determined as follows: permanent monthly remuneration of the non-executive members of the Board of Directors in the amount of BGN 4,000; permanent monthly remuneration of the Executive Director in the amount of BGN 10,000. Remunerations for the members of the Board of Directors of AGRIA GROUP HOLDING AD set by the General Meeting of Shareholders, held on 29th June 2021: Position Full monthly remuneration in BGN Executive member of BoD and Executive Director Emil Raykov BGN 10 000 Member of BOD Deyan Ovcharov BGN 4 000 ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 80 Member of BOD Stanimir Buzhev BGN 4 000 Member of BOD Daniela Taneva BGN 4 000 Member of BOD Anna Belchinska BGN 4 000 During the reporting financial year 2022 AGRIA GROUP HOLDING AD have paid additional remuneration to the executive director in the amount of BGN 500 000.00 which amount of remuneration was determined by the General Meeting of Shareholders held on 28th June 2022. For 2022 the following remunerations have been calculated from Agria Group Holding AD to the members of the company's Board of Directors: Position gross annual remuneration in BGN for 2022 Executive member of BoD and Executive Director Emil Raykov BGN 120 000 Member of BOD Deyan Ovcharov BGN 48 000 Member of BOD Stanimir Buzhev BGN 48 000 Member of BOD Daniela Taneva BGN 48 000 Member of BOD Anna Belchinska BGN 48 000 Remuneration and other material and non-material incentives received by the person from companies belonging to the same group: Name Position gross remuneration in BGN for 2022 Anna Belchinska Manager of Korn Trade EOOD 183 381.34 Stanimir Buzhev Executive Director of Kristera AD 243 655.00 Gross remuneration of the members of the Board of Directors of AGRIA GROUP HOLDING AD for 2022 in BGN: Permanent remuneration Additional remuneration Total remuneration for 2022.: 1. EMIL VESELINOV RAYKOV 120 000,00 500 000,00 620 000,00 2. DEYAN ROSENOV OVCHAROV 48 000,00 48 000,00 3. STANIMIR RUSEV BUZHEV 48 000,00 48 000,00 4. DANIELA DIMITROVA TANEVA 48 000,00 48 000,00 5. ANNA DIMITROVA BELCHINSKA 48 000,00 48 000,00 TOTAL: 312 000,00 500 000,00 812 000,00 ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 81 Gross remunerations, received by members of the Board of Directors of Agria Group Holding AD for 2022 from subsidiaries in BGN: 1. ANNA DIMITROVA BELCHINSKA 183 381.34 from Korn Trade EOOD 2. STANIMIR RUSEV BUZHEV 243 655.00 from Kristera AD and Silk Gaz BG EOOD TOTAL: 427 036.34 Note: The total amount of the additional remuneration of the members of the Board of Directors of the company does not include the payment of the independent directors, whose remuneration is a basic one without additional incentives. Emil Veselinov Raykov holds interests in the following companies as well: - Manager of Bora Invest EOOD, Varna; - Manager of Bora Energy EOOD, Varna; - Sole owner and manager of Emra EOOD, Varna; - Executive Director of RR Invest AD; - Member of the Board of Directors of Agra EAD - Member of the Board of Directors and Executive Director of Agri Grain AD - Holder of 223 shares in the capital of Kristera AD, Popovo. Anna Dimitrova Belchinska holds interests in the following companies as well: - Manager of Korn Trade EOOD, Varna. Stanimir Rusev Buzhev holds interests in the following companies as well: - Executive Director of Kristera AD, Popovo. - Executive Director of Kehlibar Pro EAD. Daniela Dimitrova Taneva and Deyan Rosenov Ovcharov are independent members of the BoD within the meaning of POSA. They hold no interests in any form whatsoever neither in companies part of the group, nor in any other companies. The members of the BoD may freely acquire shares in the Company, as well as bonds of the Company. No contracts have been entered into with the Company by members of the BoD or related parties that are outside the ordinary operations of the Company or are materially diverging from market conditions. Business policy of the Company planned for the next year, including expected investments and personnel development, expected income from investments and development of the Company, as well as forthcoming transactions of material importance for the Company The main objective of the Company is to participate in any form in other commercial companies or in their management. As a holding company, AGRIA GROUP HOLDING AD depends on the activities and results of its subsidiaries. The business policy of the Company, including investments, should be considered mainly in terms of the operations of its subsidiaries. ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 82 12. SUMMARY INFORMATION ABOUT IMPLEMENTED AND PLANNED INVESTMENTS AND BASIC TRENDS IN THEIR SPENDING Pursuant to the Investment program for 2022, Agria Group Holding AD has made the following investments: 1. Investments in purchase of agricultural land and acquisition of company equity shares – EUR 9,400,000. 2. Investments in the purchase of agricultural machinery and inventory – EUR 2,570,000. 3. Investments in storage facilities, transport and logistics – EUR 3,130,000. 13. DECLARATION ON CORPORATE GOVERNANCE The Declaration on Corporate Governance aims to present information to the investors and interested parties referring to specific actions and measures undertaken by the management of Agria Group Holding AD for keeping the basic principles of the National Code for Corporate Governance and good practices in the field of corporate management. The declaration contains information and is based on the principles and norms for good corporate governance regulated by the Bulgarian legislation, laid down in the provisions of the National Code for Corporate Governance, Commercial Law, Law on public offering of securities, Accounting Act, Law on Independent Financial Audit and other laws and regulations and internationally accepted standards in the field of corporate management. In this relation, the requirement under Art. 100n (7) from POSA for the preparation and presentation of a Declaration for corporate governance as part of the Annual report on the operations of the Company for 2022 should be considered fulfilled. 0 2000 4000 6000 8000 10000 storage facilities, transport and logistics agricultural machinery and inventory agricultural land and acquisition of company equity shares Investments in 2022 in BGN thousand ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 83 In accordance with Art. 100n (8) from POSA the Declaration on corporate governance contains: 1. Information regarding compliance, as appropriate, on part of the issuer Agria Group Holding AD with the National Code for Corporate Governance. 2. Information regarding practices of corporate governance which are applied by the issuer Agria Group Holding AD in accordance with the National Code for Corporate Governance. 3. Description of the main features of the measures for inside control and risk management of the issuer Agria Group Holding AD in relation to the financial reporting process. 4. Information under Directive 2004/25/EO of the European Parliament and the Council from 21 April 2004 referring to take over propositions. 5. The composition and functioning of the administrative and managerial bodies of the issuer Agria Group Holding AD and their Committees. 6. Description of the diversity policy applied by the issuer Agria Group Holding AD to the administrative and managerial bodies in view of age, gender or education and professional experience, the targets of the diversity policy, manner of application and results during the reporting period and in case of non- application of such policy – explanation of the reasons why it is not applied. At a meeting of the Board of Directors of Agria Group Holding AD, Varna, conducted on 19 March 2008, a resolution was passed Agria Group Holding AD, Varna, in its capacity of public company registered for trade on the Parallel market of the Bulgarian Stock Exchange AD, Segment «А», with a BSE code AGR, to accept and follow the National Code for Corporate Governance approved by the Board of Directors of BSE-Sofia AD , by applying and following its main principles. By joining the National Code for Corporate Governance the Company expresses its engagement in keeping the principles of corporate governance which are part of the document. The Code’s application is based on the principle “observe and explain” which means that the Company observes the Code and in the event of deviation the corporate management of the Company shall clarify the reasons for that. The Company has announced its decision to adopt and comply with the National Corporate Governance Code in FSC’s E-REGISTER system for disclosure of regulated information to the commission by the public companies and other issuers of securities, in the EXTRI system used for disclosure and filing information, data and documents to BSE, as well as in the X3News system for disclosure and provision of information to the public. From the date of joining the National Code for Corporate Governance, the Company carries out its activity in accordance with the Code’s principles and decrees by conforming, applying and observing the corporate practices and internationally accepted standards for good corporate management in its activity. This is achieved by applying the principles for timely information disclosure; responsibility, independence and transparency of the activities of the corporate management; protecting shareholders’ rights and equality; respecting the interested parties. The Company has not deviated from the rules and norms in the Code and has observed and applied the good practices and principles of the corporate governance. In accordance with the principle for timely information disclosure, in 2022 the Company disclosed all regulated information in the time and manner provided for in the POSA and its regulations. The corporate management ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 84 created preconditions for transparency in its relationships with investors, financial media and market analysts. There are rules for inside information and inside persons which regulate the obligations, manner and responsibility for public disclosure of inside information. In the website of the Company a section “For investors” can be found which facilitates the access to timely and up-to- date information for the Company’s investors (shareholders and potential investors), for the financial media and analysts and it also aims to create maximum transparency in their relationship with the management of Agria Group Holding AD. The management of the Company discloses its investment program for each financial year to its investors. Investors receive the information in a timely manner through the website of the company, email and via X3NEWS. The Company identifies as interested parties all persons who have interest in the economic prosperity of Agria Group Holding AD (shareholders, employees, clients, suppliers, banks and the public). The corporate management encourages the partnership between the Company and the interested parties aiming to achieve higher welfare for all parties and in view of the stable development of the Company while balancing the interests of all parties involved. The interested parties are presented with the necessary information regarding the Company’s activities, up -to-date data for its economic and financial condition and any other activity information that contributes for the right orientation and decision-making. In its policy with regard to the interested parties, the Company complies with the legal requirements based on the principles of transparence, accountancy and business ethics. In 2022 the corporate management activity is carried out in compliance with the legal requirements of POSA and its regulations, the Article of Association of the Company, as well as the National Code for Corporate Governance. Agria Group Holding AD is a public company with a single-tier management system. All members of the Board of Directors meet the legal requirements to hold such position, and have the required qualifications, knowledge and experience necessary to fulfil it. The functions and obligations of the corporate management, as well as its structure and competence, comply with the requirements of the Commerce Act, the Articles of Association of the Company, and the Code. The Board of Directors of the Company manages the Company in accordance with the goals and vision established by the Company and the interests of the shareholders. In performing their duties the members of the Board of Directors are guided by the generally accepted principles of integrity, managerial and professional competence, avoid and do not allow a real or potential conflict of interests. The annual report discloses the remuneration of the members of the Board of Directors as determined by the General Meeting, and this information is easily available to shareholders. The structure of the Board of Directors guarantees the independent and impartial actions and decisions of its members. The Board of Directors consists of five members, two of whom are independent within the meaning of POSA. The senior management of Agria Group Holding AD, represented by the corporate management, performs a key role and is responsible for the establishment of an internal control system and risk management and carries out routine monitoring in this direction. Agria Group Holding AD applies diversity policy regarding the administrative and managerial bodies of the Company in view of age, gender or education and professional experience. The persons in the administrative and managerial bodies of the issuer possess the required education, professional qualification, competency and experience to conduct the respective activity and meet the requirements of the Commercial Law, POSA and other legal norms and regulations referring to such position and they are selected/respectively hired with no ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 85 restrictions on age and gender. Through encouraging diversity, the Company reveals its social engagement with the aim for sustainable development while observing the legal requirements. The diversity policy is instrumental in the effective distribution of the functions and obligations of the corporate management while its structure and competency follow the principles of diversification and diversity within the obligatory professional and managerial competence and contributes to the effective operation of the holding structure in the different type of operations of Agria Group Holding AD. As a company carrying out activities in the public interest, in accordance with the Independent Financial Audit Act, Agria Group Holding AD in its capacity of public company, has elected through its competent body (GMS) an Audit Committee, whose members meet the legal requirements for performing this type of activity and whose activity, functions and reporting is in compliance with the decrees of the Independent Financial Audit Act. Guided by the principle of shareholders’ rights’ protection, the corporate management of Agria Group Holding AD guarantees the equal treatment of all the Company’s shareholders (including minority and foreign shareholders) and carries out a policy for protection of rights and assistance to shareholders in exercising their rights by facilitating their effective participation in the work of the General Meetings by means of timely announcement of the materials for the GMS; implementation of clear procedures with regard to the convening and carrying out of General Meetings of Shareholders; preparation of rules regarding the representation of shareholders in the General Meeting; possibility for participation in the distribution of profits by the Company in the event that the General Meeting of Shareholders adopts a specific resolution on the distribution of dividend. Through the Investor Relations Director of Agria Group Holding AD the company pursues its overall policy for assisting shareholders in the exercise of all their rights. Pursuant to the principles of the National Code for Corporate Government and the good practices in the field of corporate governance, the corporate management follows a policy of balanced interaction between shareholders, management and interested parties. Agria Group Holding AD has a working system for inside control and risk management in place, which guarantees correct identification of risks related to the Company’s activity and supports their effective management, ensures the adequate functioning of the accountancy and information disclosure systems. Inside control components Control environment Control environment covers the following elements: a) Communication and embracing honesty and ethical values. Embracing honesty and ethical values includes actions on behalf of the management to eliminate or diminish the incentives or temptations, which could suborn the personnel toward dishonest, unlawful or unethical actions. b) Competence. Competence means knowledge and skills necessary to execute the tasks determining the job description of an employee. ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 86 c) Participation of the persons occupying operative management positions. The persons occupying operative management positions significantly influence control awareness in the company. The responsibilities of the persons working in management include supervision over the design of the model and the effective functioning of the warning procedures and processes for reviewing the efficiency of the Company’s inside control. d) Structure. The establishment of an adequate structure includes taking into consideration the main fields of competence and responsibilities and adequate hierarchy levels of accountancy and reporting. e) Attribution of responsibility and power. Attribution of responsibility and power includes the policy related to the relevant business practices, knowledge and experience of the main personnel and resources provided for performing their duties. It also includes the policies and communications guaranteeing that the personnel understands the goals of the company, understands how each individual’s actions are connected and contribute to these goals as well as who and in what manner is held accountable and responsible. f) Policy and practice related to human resources. The policy and practice related to human resources reveal important questions in view of Company control awareness. The standards for selecting the most qualified individuals – focusing on education, former professional experience, achievements and proof for honesty and ethical conduct, demonstrate the Company’s engagement to employ competent and promising employees. Promotions based on periodic assessments of results show Company’s engagement to promote qualified personnel to more responsible positions. Company’s risk assessment process 2. For the purposes of financial reporting the Company’s risk assessment process includes the manner of business risk identification by the management, which risks are essential for the preparation of a financial statement in accordance with the applicable for the company financial reporting framework; assesses their meaning and the likelihood of their occurrence and makes decisions how to meet and manage them and how to evaluate the results. 3. Risk related to dependable financial reporting including outside and inside events, transactions and circumstances, which can occur or have negative effect on the ability of the company to initiate, register, process and report financial data corresponding to the management statements for genuineness in the financial report. Risk can occur or change due to circumstances listed below:  Changes in the operational environment. Changes in legislation or in the operational environment can lead to change in pressure from the competition and different risks.  New personnel. New personnel can have different focus on inside control or different understanding on it.  New or renovated information systems. Substantial or fast changes in the information systems can change internal control related risks. ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 87  Fast growth. Substantial and fast expansions of business can limit control and increase the risk for defect in its operation.  New technologies. Introducing new technologies in the production processes or information systems can change internal control risks.  New business models, products and activities. Introducing new business fields or transactions and operations with which the company has little experience, can lead to new risks related to internal control  Corporate reorganization. Reorganization can be followed by cuts in employments and changes in supervision and obligations distribution, which can change internal control risks.  Expanding business abroad. Expansion or acquisition of businesses abroad lead to new and often unique risks which can affect internal control, e.g. additional or changed risks in result of exchange operations.  New accountancy standards and clarifications. Introducing new accountancy principles or changes in the accountancy principles can affect risks related to preparation of the financial statements. The Company has developed information system including related business processes referring to financial reporting and communication. The information system includes infrastructure (physical and hardware components), software, people, procedures and data and actively uses IT. The information system related to financial reporting includes financial reporting system and consists of methods and documentation which:  Identify and reflect all valid transactions and operations;  Describe in a timely manner the transactions and operation and detailed enough to allow appropriate classification for the purposes of financial reporting;  Evaluate the transaction and operation in a manner allowing reflection in a fitting money value in the financial report;  Determine the timeframe during which the transactions and operation have arisen so that their reflection in the relevant financial report can be allowed;  Present in a fitting manner the transactions and operation and related disclosure in the financial report. Control measures 4. Control measures related to audit are categorized as policies and procedures and refer to the following:  Reviews on the execution and results. These control measures include reviews and analyses of the actual results in view of budgets, prognoses and results from previous periods; binding different data groups – operational or financial, together with analyses for interconnections ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 88 and research and corrective measures; comparison of internal data with external sources of information; review on performance results grouped by functions and operations.  Information processing  Physical controls. They include: o Physical security of assets, including measures for safekeeping, e.g. secure facilities and conditions for access to assets and documentation; o Restricted access to computer programs and files; o Periodic amount counting and comparing with the amounts reflected in the control documentation (e.g. comparing the cash counting results and the results from inventories with the accounting documents) Separation of duties. Allocating the responsibilities for transactions and operations approval, registry and responsibility for the assets to different persons. The separation of duties aims to decrease the possibilities for a certain person to be in position to conduct or cover mistakes or fraud in their usual line of duties. Information under Art. 10 Para 1 Letters ‘c’, ‘d’, ‘f’, ‘h’ and ‘i’ from Directive 2004/25/EC of the European Parliament and of the Council dated 21 April 2004 regarding takeover Para. 1, l. ‘c’ “Significant direct and indirect shareholdings (including indirect shareholdings through pyramid structures and cross-shareholdings) within the meaning of Article 85 of Directive 2001/34/EC ” Agria Group Holding AD does not possess direct or indirect shareholdings under Article 85 of Directive 2001/34/EC Para. 1, l. ‘d’ “T he holders of any securities with special control rights and a description of those rights ” Agria group Holding AD does not have holders of securities with special control rights. Para. 1, l. ‘f’ “A ny restrictions on voting rights, such as limitations of the voting rights of holders of a given percentage or number of votes, deadlines for exercising voting rights, or systems whereby, with the company’s cooperation, the financial rights attaching to securities are separated from the holding of securities ” There are no restriction on voting rights in Agria Group Holding AD Para. 1, l. ‘h’ “T he rules governing the appointment and replacement of board members and the amendment of the articles of association ” The rules governing the appointment and replacement of board members and the amendment of the articles of association are described in the Charter of Agria Group Holding AD Para. 1., l. ‘i’ “T he powers of board members, and in particular the power to issue or buy back shares ” The powers of board members are settled in the Constitution documents of Agria Group Holding AD.. ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 89 14. ADDITIONAL INFORMATION UNDER APPENDIX NO. 2 TO ARTICLE 10, ITEM 1 OF ORDINANCE NO. 2 OF FSC ON THE PROSPECTUSES FOR PUBLIC OFFERING AND ADMISSION OF SECURITIES TO TRADING ON A REGULATED MARKET The information, in terms of quantity and quality, regarding the main categories of goods, products and/or services provided, as well as in connection with revenue by main types of activities, markets, sources of supply of raw materials, is to be considered in terms of the operations of the Issuer’s subsidiaries, because Agria Group Holding AD functions as a legal entity which is a holding company carrying out investment activities, which aims to manage the stakes it holds in its subsidiaries, and which does not directly carry out any other production and/or commercial activity of its own. Information about the income dispersed by separate activity categories, inside and outside markets • Agribusiness – BGN 62 000 thousand; • Processing industry (storage and grain processing) – BGN 98 200 thousand; • Trading/export operations and services – BGN 971 000 thousand. Information on the average production in 2022 of the grain crops harvested by the holding companies - wheat, barley, sunflower and corn. Barley - 6 432 t. Wheat - 46 427 t. Sunflower - 16 782 t. Corn - 24 426 t. 5% 9% 86% Agribussiness Processing industry Trading/exportt operations and services ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 90 Information on the harvested yields per hectare of the crops concerned. Barley - 698 kg/ha Wheat - 695 kg/ha Sunflower - 290 kg/ha Corn - 570 kg/ha Irrigated corn - 1 274 kg/ha For the financial year 2022, AGRIA GROUP HOLDING AD has direct investments in the process of execution as follows: Agria Group HoldingAD has acquired in the procedure provided for by the legislation (by means of a contract for transfer of company shares with notarized signatures and contents under Article 129 of the Commercial Law and entry in the Commercial Register) from Vasil Yaroslavov Vassilev the ownership of 100% (one hundred percent) of the capital of the commercial company "AgriVia Oil" EOOD entered in the Commercial Register and in the register of non-profit organizations at the Registry Agency with UIC 205836122. During the reporting period, there were no large transactions and transactions of material importance to the issuer’s operations. Information on the loan agreements indicating conditions under them concluded by the issuer and its subsidiaries, in their capacity as borrowers, including the deadlines for repayment, as well information provided on guarantees and commitments. Information on loans granted by the issuer and its subsidiaries, providing guarantees or commitments in total to one person or its subsidiary, including related parties, indicating the name and title and UIC of the person, nature of the relationship between the issuer or its subsidiaries and the borrower, the amount of unpaid principal, interest rate, date of conclusion of the contract, deadline for repayment, amount of commitment, specific conditions and the purpose for which they are granted, if concluded as a target. ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 91 1. Loans granted as at 31.12.2022 BGN in thousand Company Loan Granted From UIC Relationship subsidiary related/unrelated parties Obligation Amount Unpaid Principal Interest Rate Conclusion of contract incl. additional agreements Repayment date Guarantees Earmarked loans (if applicable, specify the purpose for which the loan was granted) specific conditions other than the listed in par. 9 of Appendix 2 to the Ordinance Agria Group Holding AD Agra ЕAD 124690525 SUBSIDIARY 450 450 3.00% 01-06-22 30-06-23 SUBSIDIES yes/no AGRIKORN STAR ЕAD 204462180 UNRELATED PARTY 350 350 3.00% 01-06-22 30-06-23 SUBSIDIES Agro EOOD 103765583 SUBSIDIARY 400 400 3.00% 01-06-22 30-06-23 SUBSIDIES Aris-Agro EOOD 124608460 SUBSIDIARY 100 100 3.00% 01-06-22 30-06-23 SUBSIDIES BD AGRI EOOD 103960661 SUBSIDIARY 950 950 3.00% 01-06-22 30-06-23 SUBSIDIES BD FARM EOOD 175429573 SUBSIDIARY 250 250 3.00% 01-06-22 30-06-23 SUBSIDIES Bora Energy EOOD 202309677 SUBSIDIARY 6500 6500 3.00% 26.5.2016/28.05.2021 31-05-26 Bora Energy EOOD 202309677 SUBSIDIARY 5000 2614 3.00% 07-03-22 31-03-27 BORA INVEST EOOD 103794531 SUBSIDIARY 5000 1813 3.00% 26.2.2016/25.02.2021 26-02-26 GRUVAR EOOD 200673632 SUBSIDIARY 150 150 3.00% 01-06-22 30-06-23 SUBSIDIES DIASVET EOOD 117595265 SUBSIDIARY 200 200 3.00% 01-06-22 30-06-23 SUBSIDIES EKO HERBS ЕAD 204522624 UNRELATED PARTY 250 250 3.00% 01-06-22 30-06-23 SUBSIDIES ELIT - 86 EOOD 124718585 SUBSIDIARY 100 100 3.00% 01-06-22 30-06-23 SUBSIDIES KOMERS EOOD 125044589 UNRELATED PARTY 15000 1809 2.20% 23.3.2015/18.12.2020 31-12-22 KORN SECURITYEOOD 131362354 SUBSIDIARY 450 0 0.00% 10.12.2012/05.12.2017 31-12-22 Kristera - Agro EOOD 125506526 SUBSIDIARY 1600 1600 3.00% 01-06-22 30-06-23 SUBSIDIES Kristera - Agro EOOD 125506526 SUBSIDIARY 5000 346 3.00% 04-01-22 31-12-27 TONI - M EOOD 124620498 SUBSIDIARY 300 300 3.00% 01-06-22 30-06-23 SUBSIDIES SILK GAZ BG EOOD 200491658 SUBSIDIARY 2000 2000 3.00% 01-03-22 01-03-27 SILK GAZ BG EOOD 200491658 SUBSIDIARY 2000 2000 3.00% 20-06-22 30-06-27 SILK GAZ BG EOOD 200491658 SUBSIDIARY 2000 332 3.00% 26-07-22 31-07-27 KORN STAR ООД 206566256 RELATED PARTY 900 900 3.00% 01-06-22 30-06-23 SUBSIDIES Agra ЕAD Kristera Agro EOOD 125506526 RELATED PARTY 4500 4428 3.00% 01.12.2017/02.01.2018/01.09.2018/18.12.2019/14.01.2019/16.12.2019/15.06.2020/30.12.2021 31-12-23 Agro EOOD Kristera Agro EOOD 125506526 RELATED PARTY 1000 1000 3.00% 10.12.2019/29.12.2020 31-12-22 Kristera Agro EOOD 125506526 RELATED PARTY 1000 1000 3.00% 01-08-22 31-12-24 Kristera Agro EOOD 125506526 RELATED PARTY 500 356 3.00% 19-08-22 31-12-24 Aris Agro EOOD Kristera - Agro EOOD 125506526 RELATED PARTY 1300 1253 3.00% 10.04.2020/01.12.2020 31-12-22 BD AGRI EOOD Kristera - Agro EOOD 125506526 RELATED PARTY 1500 1159 3.00% 05.05.2020/01.03.2021 31-12-22 Kristera - Agro EOOD 125506526 RELATED PARTY 1100 1100 3.00% 20-06-22 31-12-24 BD FARMEOOD Kristera AD 103273795 RELATED PARTY 5000 3259 3.00% 23-12-21 31-12-24 Kristera - Agro EOOD 125506526 RELATED PARTY 4500 2877 3.00% 16.11.2017/16.12.2017/02.01.2018/28.12.2018/27.12.2019/29.12.2020/30.12.202131-12-23 Bora Energy EOOD Agria Group Holding AD 148135254 RELATED PARTY 6000 0 3.00% 02-07-18 31-12-23 ENERGY SOLAR TECHNOLOGY AD 206589858 UNRELATED PARTY 200 200 3.00% 11-04-22 01-02-23 ENERGY SOLAR TECHNOLOGY AD 206589858 UNRELATED PARTY 200 200 3.00% 01-09-22 01-09-24 BORA INVEST EOOD 0.00% GRUVAR EOOD Kristera Agro EOOD 125506526 RELATED PARTY 3000 710 3.00% 20.12.2017/02.01.2018/02.12.2019/01.12.2020/20.12.2021 31-12-24 GRUVAR EOOD Kristera Agro EOOD 125506526 RELATED PARTY 10000 4300 3.00% 26.09.2016/05.01.2017/02.01.2018/.02.01.2018/20.12.2021 31-12-24 DIASVET EOOD Kristera - Agro EOOD 125506526 RELATED PARTY 2000 60 3.00% 01.12.2019/01.08.2020/31.12.2021 31-12-24 Kristera - Agro EOOD 125506526 RELATED PARTY 2500 1770 3.00% 01-08-22 31-12-24 ELIT 86 EOOD Kristera - Agro EOOD 125506526 RELATED PARTY 1000 1000 3.00% 01-08-22 31-12-24 KEHLIBAR EOOD 0.00% AG PROPERTY INVEST EOOD AB INVESTMENT GROUP AD 206405947 UNRELATED PARTY 1476 1476 2.00% 29-03-22 29-03-23 AB INVESTMENT GROUP AD 206405947 UNRELATED PARTY 978 978 2.00% 12-07-22 12-07-23 KORN STAR ООD KORN TRADE EOOD KOMERS EOOD 125044589 UNRELATED PARTY 3000 0 3.00% 01-12-21 31-12-22 EKO HERBS ЕAD 204522624 UNRELATED PARTY 1000 0 2.00% 21-02-22 31-08-26 EKO HERBS ЕAD 204522624 UNRELATED PARTY 2000 0 2.00% 30-03-22 31-08-26 Kristera Agro EOOD 125506526 RELATED PARTY 5400 0 3.00% 28-03-22 31-12-23 SILK GAZ BG EOOD 200491658 RELATED PARTY 2000 1080 3.00% 04-03-22 31-12-23 AG PROPERTY INVEST EOOD 131362354 RELATED PARTY 1000 978 3.00% 20-07-22 30-07-24 AGRIVIA OIL EOOD 205836122 RELATED PARTY 5000 0 3.00% 01-09-22 30-09-22 AGRIVIA OIL EOOD 205836122 RELATED PARTY 1500 3.00% 12-09-22 30-09-22 Kristera Agro EOOD KOMERS EOOD 125044589 UNRELATED PARTY 5000 5000 3.00% 24-09-21 31-12-26 KOMERS EOOD 125044589 UNRELATED PARTY 5500 3561 3.00% 01.11.2013/30.05.2014/01.05.2015/28.12.2015/04.01.2017/01.02.2018/02.01.2019/29.12.2020 31-12-22 KOMERS EOOD 125044590 UNRELATED PARTY 5000 2850 3.10% 01-08-22 31-12-26 ET KAMEN SHISHKOV 117618493 UNRELATED PARTY 10000 4300 3.00% 04.08.2016/04.08.2021 04-08-24 AGRIKORN STAR ЕAD 204462180 UNRELATED PARTY 4000 4000 3.00% 01.11.2018/10.06.2020 31-12-23 AGRIKORN STAR ЕAD 204462180 UNRELATED PARTY 4000 2244 3.00% 02-08-21 31-12-24 EKO HERBS ЕAD 204522624 UNRELATED PARTY 4000 1512 1.50% 15-09-21 31-08-26 EKO HERBS ЕAD 204522624 UNRELATED PARTY 5000 0 3.00% 09.12.2019/20.02.2020 31-12-22 Kristera AD Agria Group Holding AD 148135254 RELATED PARTY 10000 1205 3.00% 8.8.2016/02.08.2021 08-08-26 KORN SECURITYEOOD 131362354 RELATED PARTY 4000 0 0.00% 03.01.2010/05.12.2017 31-12-22 Kristera - Agro EOOD 125506526 RELATED PARTY 10000 0 3.00% 03-02-20 03-02-25 BORA INVEST EOOD 103794531 RELATED PARTY 1000 1000 3.00% 26.09.2013/23.09.2021 26-06-26 BORA INVEST EOOD 103794531 RELATED PARTY 5000 1182 3.00% 01-03-19 01-03-24 EKO HERBS ЕAD 204522624 UNRELATED PARTY 6000 0 1.50% 02-08-21 31-08-26 AGRO OIL KONSULT OOD 124561854 UNRELATED PARTY 400 400 3.00% 12-04-22 31-03-23 Agrikorn Star EAD 204462180 UNRELATED PARTY 1000 270 3.00% 12-08-22 31-08-27 Bora Energy EOOD 202309677 RELATED PARTY 200 200 2.90% 31-08-22 01-09-24 SILK GAZ BG EOOD N/A 0.00% TERA PROTEKT EOOD Agria Group Holding AD 148135254 RELATED PARTY 400 0 3.00% 10-08-20 10-08-25 TONI - М EOOD Kristera Agro EOOD 125506526 RELATED PARTY 2000 2000 3.00% 16-12-19 31-12-22 Agria Group Holding AD 148135254 RELATED PARTY 4000 2179 3.00% 03.10.2016/05.01.2017/01.10.2021/30.09.2022 03-10-22 Kristera Agro EOOD 125506526 RELATED PARTY 500 104 3.00% 01-08-22 31-12-24 ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 92 2.Loans received as at 31.12.2022 BGN in thousand Company Loan granted from UIC Relationship subsidiary related/UNRELATED PARTY Obligation Amount Unpaid Principal Interest Rate Conclusion of contract incl. additional agreements Repayment date Guarantees Earmarked loans (if applicable, specify the purpose for which the loan was granted) specific conditions other than the listed in par. 9 of Appendix 2 to the Ordinance AGRIA GROUP HOLDING AD KRISTERA AD 103273795 RELATED PARTY 10000 505 3.00% 8.8.2016/02.08.2021 08-08-26 yes/no yes/no BORA ENERGY EOOD 202309677 RELATED PARTY 6000 0 3.00% 02-07-18 31-12-23 TONI- М EOOD 124620498 RELATED PARTY 4000 2179 3.00% 3.10.2016/05.01.2017 03-10-22 TERA PROTEKT EOOD 202946357 RELATED PARTY 400 0 3.00% 10-08-20 10-08-25 AGRA ЕAD AGRIA GROUP HOLDING AD 148135254 RELATED PARTY 450 450 3.00% 01-06-22 30-06-23 SBSIDIES AGRO EOOD AGRIA GROUP HOLDING AD 148135254 RELATED PARTY 400 400 3.00% 01-06-22 30-06-23 SBSIDIES ARIS AGRO EOOD AGRIA GROUP HOLDING AD 148135254 RELATED PARTY 100 100 3.00% 01-06-22 30-06-23 SBSIDIES BD AGRI EOOD AGRIA GROUP HOLDING AD 148135254 RELATED PARTY 950 950 3.00% 01-06-22 30-06-23 SBSIDIES BD FARM EOOD AGRIA GROUP HOLDING AD 148135254 RELATED PARTY 250 250 3.00% 01-06-22 30-06-23 SBSIDIES BORA ENERGY EOOD AGRIA GROUP HOLDING AD 148135254 RELATED PARTY 6500 6500 3.00% 26.5.2016/28.05.2021 31-05-26 AGRIA GROUP HOLDING AD 148135254 RELATED PARTY 5000 2614 3.00% 07-03-22 31-03-27 KRISTERA AD 103273795 RELATED PARTY 200 200 2.90% 31-08-22 01-09-24 BORA INVEST EOOD AGRIA GROUP HOLDING AD 148135254 RELATED PARTY 5000 1863 3.00% 26.2.2016/25.02.2021 26-02-26 KRISTERA AD 103273795 RELATED PARTY 1000 1000 3.00% 26.09.2013/23.09.2021 26-06-26 KRISTERA AD 103273795 RELATED PARTY 5000 1182 3.00% 01-03-19 01-03-24 0.00% GRUVAR EOOD ET KAMEN SHISHKOV 8601315380 UNRELATED PARTY 10000 4300 3.20% 04.08.2016/04.08.2021 04-08-24 GRUVAR EOOD AGRIA GROUP HOLDING AD 148135254 RELATED PARTY 150 150 3.00% 01-06-22 30-06-23 SBSIDIES 0.00% DIASVET EOOD AGRIA GROUP HOLDING AD 148135254 RELATED PARTY 200 200 3.00% 01-06-22 30-06-23 SBSIDIES ELIT 86 EOOD AGRIA GROUP HOLDING AD 148135254 RELATED PARTY 100 100 3.00% 01-06-22 30-06-23 SBSIDIES KEHLIBAR EOOD A G PROERTY INVEST EOOD AGRIA GROUP HOLDING AD 148135254 RELATED PARTY 450 0 0.00% 10.12.2012/05.12.2017 31-12-22 KRISTERA AD 103273795 RELATED PARTY 4000 0 0.00% 03.01.2010/05.12.2017 31-12-22 KORN TRADE EOOD 103647462 RELATED PARTY 1000 978 3.00% 20-07-22 30-07-24 KORN STAR ООD AGRIA GROUP HOLDING AD 148135254 RELATED PARTY 900 900 3.00% 01-06-22 30-06-23 SBSIDIES KORN TRADE EOOD N/A 3.00% KRISTERA AGRO EOOD AGRIA GROUP HOLDING AD 148135254 RELATED PARTY 1600 1600 3.00% 01-06-22 30-06-23 AGRIA GROUP HOLDING AD 148135254 RELATED PARTY 5000 346 3.00% 04-01-22 31-12-27 AGRO EOOD 103765583 RELATED PARTY 1000 1000 3.00% 10.12.2019/29.12.2020 31-12-22 AGRO EOOD 103765583 RELATED PARTY 1000 1000 3.00% 01-08-22 31-12-24 AGRO EOOD 103765583 RELATED PARTY 500 356 3.00% 19.08.022 31-12-24 ELIT - 86 EOOD 124718586 RELATED PARTY 1000 1000 3.00% 01-08-22 31-12-24 GRUVAR EOOD 200673632 RELATED PARTY 3000 710 3.00% 20.12.2017/02.01.2018/02.12.2019/01.12.2020/20.12.2021 31-12-24 GRUVAR EOOD 200673632 RELATED PARTY 10000 4300 3.00% 26.09.2016/05.01.2017/02.01.2018/.02.01.2018/20.12.2021 31-12-24 BD FARM EOOD 175429573 RELATED PARTY 4500 2877 3.00% 16.11.2017/16.12.2017/02.01.2018/28.12.2018/27.12.2019/29.12.2020/30.12.2021 31-12-23 DIASVET EOOD 117595265 RELATED PARTY 2000 60 3.00% 01.12.2019/01.08.2020/31.12.2021 31-12-24 DIASVET EOOD 117595265 RELATED PARTY 2500 1770 3.00% 01-08-22 31-12-24 AGRA ЕAD 124690525 RELATED PARTY 4500 4428 3.00% 01.12.2017/02.01.2018/01.09.2018/18.12.2019/14.01.2019/16.12.2019/15.06.2020/30.12.2021 31-12-23 ARIS -AGRO EOOD 124608460 RELATED PARTY 1300 1253 3.00% 10.04.2020/01.12.2020 31-12-22 TONI- М EOOD 124620498 RELATED PARTY 2000 2000 3.00% 16-12-19 31-12-22 TONI- М EOOD 124620498 RELATED PARTY 500 104 3.00% 01-08-22 31-12-24 BD AGRI EOOD 103960661 RELATED PARTY 1500 1159 3.00% 05.05.2020/01.03.2021 31-12-22 BD AGRI EOOD 103960662 RELATED PARTY 1100 1100 3.00% 20-06-22 31-12-24 AGRO OIL KONSULT OOD 124561854 UNRELATED PARTY 724 724 3.00% 16-11-18 30-04-23 KRISTERA AD BD FARM EOOD 175429573 5000 3259 3.00% 23-12-21 31-12-24 SILK GAZ BG EOOD AGRIA GROUP HOLDING AD 148135286 RELATED PARTY 2000 2000 3.00% 01-03-22 01-03-27 AGRIA GROUP HOLDING AD 148135286 RELATED PARTY 2000 2000 3.00% 20-06-22 30-06-27 AGRIA GROUP HOLDING AD 148135286 RELATED PARTY 2000 332 3.00% 26-07-22 31-07-27 KORN TRADE EOOD 103746472 RELATED PARTY 2000 1080 3.00% 04-03-22 31-12-23 TERA PROTEKT EOOD KRISTERA AD 103273795 RELATED PARTY 200 0 3.00% 15-09-22 15-09-23 TONI - М EOOD AGRIA GROUP HOLDING AD 148135286 RELATED PARTY 300 300 3.00% 01-06-22 30-06-23 SBSIDIES FOR "AGRIA GROUP HOLDING" AD: EMIL RAYKOV - EXECUTIVE DIRECTOR ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 93 Transactions with related parties During the past year of 2022 Agria Group Holding AD entered into no large transactions with related parties, with the exception of ordinary economic activity transactions. The dealings with related parties were not carried out under special conditions and no guarantees were either provided or received. BGN thousand ASSET PER INVOICE LOANS AND PARTICIPATING INTEREST TOTAL RECEIVABLES, INCL..: 16 35,332 35,348 BORA INVEST EOOD 0 2,279 2,279 KRISTERA-AGRO EOOD 3 5,290 5,293 AGRO EOOD 3 2,203 2,206 KORN STAR OOD 0 613 613 AG PROPERTY INVEST EOOD 0 0 0 ELIT-86 EOOD EOOD 2 523 525 BORA ENERGY EOOD 0 10,466 10,466 KRISTERA AD 0 4,700 4,700 EMIL RAYKOV 0 153 153 BD AGRI EOOD 2 1,501 1,503 DIASVET EOOD 0 57 57 BD FARM EOOD 0 181 181 AGRA EAD 0 2,526 2,526 GRUVAR EOOD 2 33 35 TONI-M EOOD 2 4,774 4,776 ARIS-AGRO EOOD 2 33 35 LIABILITIES PER INVOICE LOAN TOTAL LIABILITIES, INCL..: 34 4,644 4,678 TONI-M EOOD 0 2,728 2,428 TERA PROTEKT EOOD 34 6 23 KRISTERA AD 0 1,910 1,910 No related party transactions that are outside the usual scope of activity of the issuer or are materially diverging from market conditions have been entered into. No events or indicators of unusual nature with regard to the issuer exist. There is no off-balance-sheet reporting of transactions of Agria Group Holding AD. ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 94 Information on the equity stakes held by Agria Group Holding AD in other companies is provided above in the present Report. The management of the company’s financial resources is subject to the requirement for achieving maximum effectiveness, while at the same time meeting the terms of payment agreed with suppliers and clients. This includes a balanced approach with regard to own and attracted financial resources, which leads to lower financial costs. The result of such financial resources management policy is the faster reduction of the debt recovery period versus the debt payment period, which maintains a high liquidity of payments. This leads to the effective increase of the cash funds of the company and to the possibility of financing investment costs, without this always being at the expense of a financial resource extended by a bank, which optimises the payment of interest costs. As at 31.12.2022 Agria Group Holding AD has the following liabilities to bank loans in: Company Financing institution Type of loan Currency Authorized amount in KEUR Drawn amount in KEUR - 31.12.2022 Maturity Agria Group Holding DSK Bank Working Capital EUR 12 000 9 511 Nov 2023 Agria Group Holding DSK Bank Working Capital EUR 3 068 1 502 June 203 Agria Group Holding DSK Bank Investment EUR 2 000 333 Jan 2024 Agria Group Holding DSK Bank Investment EUR 2 000 310 Feb 2024 Agria Group Holding DSK Bank Investment EUR 3 068 1 591 Aug 2027 Agria Group Holding Unikcredit Investment EUR 3 000 500 Mar 2024 Agria Group Holding Unicredit Investment EUR 3 000 792 Feb 2025 Agria Group Holding Unicredit Investment EUR 2 000 800 Sept 2026 Agria Group Holding Unicredit Investment/Working capital EUR 8 200 5 019 Oct 2028 Agria Group Holding DSK Bank Investment / Working capital EUR 3 068 2 703 Dec 2026 Agria Group Holding Interlease Investment EUR 118 75 Jul 2026 ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 95 The senior management of Agria Group Holding AD, represented by corporate governance, performs a key role and carries responsibility for the establishment of an internal control system and risk management and carries out routine monitoring in this direction. The company elaborated a risk management and internal audit system. The elected Audit Committee applies the principle of rotation in the election of auditor. In view of the dynamics of the market environment, the risk management system cannot be fully guaranteed, due to which all of the risks, facing any operating company, cannot be completely eliminated. Information about used by the company financial instruments as well as related to them risk management policy is presented in the attachment to the annual financial report of the company. In 2022 the Company has not issued any securities. No change has occurred in the basic management principles of the issuer during the reporting period. There are no arrangements known to the Company, as a result of which future changes may occur in the relative proportion of shares or bonds held by present shareholders or bondholders. As at 31.12.2022, the member of the Board of Directors Anna Dimitrova Belchinska owns 1600 shares from the capital of Agria Group Holding AD. In 2022 there were no changes in the members of the Board of Directors of Agria Group Holding AD. There are no pending judicial, administrative or arbitration proceedings, pertaining to liabilities or receivables of the issuer amounting to at least 10 per cent of its equity. Events occurring after the end of the 2022 financial year By Resolution of 12.01.2023, the Commission for Protection of Competition adopted the following decisions: 1. APPROVES the concentration between companies to be implemented by acquisition of sole control over Almagest AD (UIC 175340142) by Agria Group Holding AD (UIC 148135254). 2. Immediate execution of the decision under item 1. On 8th of February 2023 Agria Group Holding AD concluded final sale-purchase contract of 441,866 ordinary registered dematerialised shares with voting rights from Almagest AD trading company capital, entered in the Commercial Register and in the Register of Legal Entities at the Registry Agency with UIC 175340142, with a nominal value of 80 each, representing 100% of the capital of Almagest AD. On that date, the shares were transferred from the sellers to the buyer by registering the transfer transaction with the Central Depository AD, in accordance with the requirements of the current legislation, and Agria Group Holding AD acquired the ownership of 100% of the shares of the capital of Almagest AD. The shares have been transferred to the buyer, Agria Group Holding AD, free of any third party liabilities, encumbrances, rights and claims, together with all rights arising from or related to them. The transaction supports the implementation of part of the investment program of the holding in the direction of strengthening Agria Group Holding's presence in the renewable energy market, which is within the scope of ANNUAL CONSOLIDATED ACTIVITY REPORT FOR 2022 AGRIA GROUP HOLDING JSC 96 the holding's business lines, in accordance with the long-term development strategy. Combining the business potential of Agria Group Holding AD and Almagest AD, would be representing a sustainable foundation for future successful growth and diversification of the business lines developed by the company. There are no related and/or interested parties involved in the future transaction. The transaction does not fall within the scope of Article 114(1) of the Securities Act, as this type of transaction, in accordance with the scope of activity of Agria Group Holding AD, in line with the provision of Article 114(10) of the Securities Act, is in the ordinary commercial activity, representing the sum of actions and transactions performed by the company within the scope of its business activity and in accordance with the ordinary commercial practice. As a consequence of the military conflict between Russia and Ukraine at the end of February of the previous year, normal trade relations with the two countries involved have been disrupted. The European Union and many countries around the world have imposed a number of economic sanctions on Russia. The restrictive economic and financial measures taken could lead to changes in the prices of energy sources and other goods and services that are important for the development of the Bulgarian economy. The corporate management analyses and monitors all developments in order to determine protective and stabilisation measures. With their implementation, the negative consequences of the military conflict are expected to be mitigated to the extent that they do not have a material adverse impact on the future viability and the Company's ability to continue as a going concern. Information in accordance to Article 10, Item 4 of Ordinance No. 2 of FSC Link to the place on the website of the public company where the internal information under Art. 7 of Regulation (EU) No 596/2014 on the circumstances that occurred during the respectiv e six months, or link to the news agency or other media selected by the issuer, through which the company publicly discloses inside information on market abuse (Regulation on market abuse) and repealing Directive 2003/6 / EC of the European Parliament and the Council and Directives 2003/124 / EC, 2003/125 / EC and 2004/72 / EC of the Commission (OJ, L) 173/1 of 12 June 2014) (Regulation (EU) No 596/2014) on the circumstances that occurred during the past year, or an electronic reference to the news agency or other media selected by the issuer through which the company discloses public inside information. The internal information under Art. 7 of Regulation (EU) No 596/2014 on the circumstances that occurred during the past year are available on the website of Extras (www.x3news.com), on the website of the Company (www.agriabg.com), "For investors” section, in the" Financial Statements " submenu and in the "News" section. Investor Relations Director: Teodora Ivanova Ivanova Tel.052/554000; 554014 E-mail [email protected] Address: 111 Knyaz Boris I Blvd., fl.9, Varna Emil Raykov – Executive member of the Board of Directors of Agria Group Holding AD 97 INFORMATION REGARDING AGRIA GROUP HOLDING AD, VARNA, UNDER SUPPLEMENT No 3 TO Art. 10 FROM ORDINANCE No 2 OF FSC FOR INITIAL AND FOLLOWING DISCLOSURE OF INFORMATION FOR PUBLIC OFFERING OF SECURITIES AND ADMITTING SECURITIES TO TRADING ON A REGULATED MARKET 1. Information regarding securities which were not admitted to trading on a regulated market in the Republic of Bulgaria or another member state The capital of Agria Group Holding AD as at 31 December 2022 is BGN 6,800,000 (six million and eight hundred thousand leva), distributed in 6,800,000 (six million and eight hundred thousand) ordinary, registered, dematerialized, voting shares with par value of BGN 1 (one) each. The subscribed capital of the Company has been fully paid in and has been entered into the Commercial Register of the Registry Agency. The shares in the Company are ordinary, registered, dematerialized, freely transferable conferring the right to 1 (one) vote in the General Meeting of Shareholders, they confer the same rights to their holders and are of one class. Every share confers the right to one vote in the General Meeting of Shareholders in the Company, right to dividend in the distribution of the profit and right to a liquidation share in the event of winding up the Company and liquidation of its property in proportion to its nominal value and the ratio of the share to the overall capital. The shares of the Company are listed on the Main Market Premium Equities Segment of the Bulgarian Stock Exchange AD. The stock exchange ticker symbol attached is AGH. There is no information on securities which are not admitted to trading on a regulated market in the Republic of Bulgaria or another member state. 2. Information concerning the direct and indirect holding of 5 per cent or more of the voting rights in the General Meeting of the company, including details about the shareholders, the extent of their shareholding and the way the shares are held. As at 31 December 2022 the following shareholders hold shares in the capital of Agria Group Holding AD, representing 5 per cent or more of the votes in the General Meeting of Shareholders: Shareholder structure of Agria Group Holding AD as at 31 December 2022 Name/Shareholder’s name Number of shares/votes in GM Percent of capital Emra EOOD, Varna 2 795 500 41.11 % of capital Komers EOOD, Targovishte 1 855 639 27.29 % of capital Svetlomir Iliev Todorov 697 355 10.26 % of capital Other legal entities and natural persons 1 401 506 20.61 % of capital 98 3 Details about the shareholders enjoying special control rights and description of those rights. The Company has no shareholders enjoying special control rights. 4. Agreements between the shareholders which are known to the Company and which can lead to restrictions regarding transfer of shares or the right to vote. The Company is not aware of agreements between shareholders which can lead to restrictions regarding transfer of shares or the right to vote. 5. Substantial contracts entered into by the Company which give rise to action, undergo changes or are terminated due to a change in control of the Company when having a mandatory tender offering, and the consequences of those, except in the cases when disclosure of such information may cause serious damage to the Company; the exception provided for in the preceding sentence does not apply when the company is obligated to disclose the information by virtue of the law. The Company has not entered into substantial contracts which give rise to action, undergo changes or are terminated due to a change in control of the Company when having a mandatory tender offering. .................................................. For Agria Group Holding AD Emil Raykov – BoD Chairman and Executive Director DECLARATION ON CORPORATE GOVERNANCE AGRIA GROUP HOLDING JSC 100 DECLARATION ON CORPORATE GOVERNANCE The Declaration on Corporate Governance aims to present information to the investors and interested parties referring to specific actions and measures undertaken by the management of Agria Group Holding AD for keeping the basic principles of the National Code for Corporate Governance and good practices in the field of corporate management. The declaration contains information and is based on the principles and norms for good corporate governance regulated by the Bulgarian legislation as laid down in the provisions of the National Code for Corporate Governance, Commercial Law, Law on public offering of securities, Accounting Act, Law on Independent Financial Audit and other laws and regulations and internationally accepted standards in the field of corporate management. In this relation the requirement under Art. 100n (7) from POSA for the preparation and presentation of a Declaration for corporate governance as part of the Annual report on the operations of the Company for 2022 should be considered fulfilled. In accordance with Art. 100n (8) from POSA the Declaration on corporate governance contains: 1. Information regarding compliance, as appropriate, on part of the issuer Agria Group Holding AD with the National Code for Corporate Governance. 2. Information regarding practices of corporate governance which are applied by the issuer Agria Group Holding AD in accordance with the National Code for Corporate Governance. 3. Description of the main features of the measures for inside control and risk management of the issuer Agria Group Holding AD in relation to the financial reporting process. 4. Information under Directive 2004/25/EO of the European Parliament and the Council from 21 April 2004 referring to take over propositions. 5. The composition and functioning of the administrative and managerial bodies of the issuer Agria Group Holding AD and their Committees. 6. Description of the diversity policy applied by the issuer Agria Group Holding AD to the administrative and managerial bodies in view of age, gender or education and professional experience, the targets of the diversity policy, manner of application and results during the reporting period and in case of non-application of such policy – explanation of the reasons why not applied. At a meeting of the Board of Directors of Agria Group Holding AD, Varna, conducted on 19 March 2008, a resolution was passed Agria Group Holding AD, Varna, in its capacity of public company registered for trade on the Parallel market of the Bulgarian Stock Exchange AD with a BSE code AGR, to accept and follow the National Code for Corporate Governance approved by the Board of Directors of BSE-Sofia AD , by applying and following its main principles. By joining the National Code for Corporate Governance the Company expresses its engagement in keeping the principles of corporate governance which are part of the document. The Code’s application is based on the principle “observe and explain” which means that the Company observes the Code and in case of lapse the corporate management of the Company is expected to clarify the reasons for that. 101 DECLARATION ON CORPORATE GOVERNANCE The Company has announced its decision to adopt and comply with the National Corporate Governance Code in FSC’s E -REGISTER system for disclosure of regulated information to the commission by the public companies and other issuers of securities, in the EXTRI system used for disclosure and filing information, data and documents to BSE, as well as in the X3News system for disclosure and provision of information to the public. From the date of joining the National Code for Corporate Governance, the Company carries out its activity in accordance with the Code’s principles and decrees by conforming, applying and observing the corporate practices and internationally accepted standards for good corporate management in its activity. This is achieved by applying the principles for timely information disclosure; responsibility, independence and transparency of the activities of the corporate management; protecting shareholders’ rights and equality; respecting the interested parties. The Company has not deviated from the rules and norms in the Code and has observed and applied the good practices and principles of the corporate governance. In accordance with the principle for timely information disclosure, in 2022 the Company disclosed all regulated information in the time and manner provided for in the POSA and its regulations. The corporate management created preconditions for transparency in its relationship with investors, financial media and market analysts. There are rules for inside information and inside persons which regulate the obligations, manner and responsibility for public disclosure of inside information. In the website of the Company a section “For investors” can be found which facilitates the access to timely and up-to- date information for the Company’s investors (shareholders and potential investors), for the financial media and analysts and also aims to create maximum transparency in their relationship with the management of Agria Group Holding AD. The management of the Company discloses its investment program for each financial year to its investors. Investors receive the information in a timely manner through the website of the company, email and via X3NEWS. The Company identifies as interested parties all persons who have interest in the economic prosperity of Agria Group Holding AD (shareholders, employees, clients, suppliers, banks and the public). The corporate management encourages the partnership between the Company and the interested parties aiming to achieve higher welfare for all parties and in view of the stable development of the Company while balancing the interests of all parties involved. The interested parties are presented with the necessary information regarding the Company’s activities, up -to-date data for its economic and financial condition and any other activity information which contributes for the right orientation and decision making. In its interested parties policy the Company complies with the legal requirements based on the principles of transparence, accountancy and business ethics. In 2022 the corporate management activity is carried out in compliance with the legal requirements of POSA and its regulations, the Article of Association of the Company, as well as the National Code for Corporate Governance. Agria Group Holding AD is a public company with a single- tier management system. All members of the Board of Directors meet the legal requirements to hold such a position, and have the required qualifications, knowledge and experience necessary to fulfil it. 102 DECLARATION ON CORPORATE GOVERNANCE The functions and obligations of the corporate management, as well as its structure and competence, comply with the requirements of the Commerce Act, the Articles of Association of the Company, and the Code. The Board of Directors of the Company manages the Company in accordance with the goals and vision established by the Company and the interests of the shareholders. In their activities the members of the Board of Directors are guided by the generally accepted principles of integrity and managerial and professional competence and avoid and do not allow a real or potential conflict of interests. The annual report discloses the remuneration of the members of the Board of Directors as determined by the General Meeting, and this information is easily available to shareholders. The membership of the Board of Directors guarantees the independent and impartial actions and decisions of its members. The Board of Directors consists of five members, two of whom are independent within the meaning of POSA. Management The Company has a single-tier management system - a Board of Directors. Names, functions and remuneration of the members of the corporate management Agria Group Holding AD, Varna, has a single-tier management system and is managed and represented by a Board of Directors, which operates under the supervision of the General Meeting. The remunerations of the members of the Board of Directors are determined in accordance with the Remuneration Policy for the members of the Board of Directors of Agria Group Holding AD approved by the General Meeting of Shareholders. Agria Group Holding AD pays the members of the Board of Directors a regular remuneration which is approved by the General Meeting of Shareholders of the company, taking into account the obligations and the contribution of each members of the Board of Directors to the activity and the results of the company , as well as the opportunity recruit and retain qualified and loyal members of the Board of Directors and compliance of the interests of the members of the Board of Directors with the long-term interests of the Company to coincide. In view of the financial and economic standing of the Company and the certain input of the members of the Board of Directors of AGRIA GROUP HOLDING AD, during the reporting 2022 the members of the Board of Directors received fixed remunerations, which certain amount was approved 103 DECLARATION ON CORPORATE GOVERNANCE by the General Meeting of Shareholders of the Company. The amount of the permanent monthly remuneration of the members of the Board of Directors, until the date of the resolution from Ordinary the General Meeting of Shareholders of AGRIA GROUP HOLDING AD,held on 29th June 2021 is determined as follows: : permanent monthly remuneration of the non-executive members of the Board of Directors in the amount of BGN 4,000; permanent monthly remuneration of the Executive Director in the amount of BGN 10,000. Remunerations for the members of the Board of Directors of AGRIA GROUP HOLDING AD set by the General Meeting of Shareholders, held on 29th June 2021: Position Full monthly remuneration in BGN Executive member of BoD and Executive Director Emil Raykov BGN 10 000 Member of BOD Deyan Ovcharov BGN 4 000 Member of BOD Stanimir Buzhev BGN 4 000 Member of BOD Daniela Taneva BGN 4 000 Member of BOD Anna Belchinska BGN 4 000 During the reporting financial year 2022 AGRIA GROUP HOLDING AD have paid additional remuneration to the executive director in the amount of BGN 500 000.00 which amount of remuneration was determined by the General Meeting of Shareholders held on 28th June 2022. For 2022 the following remunerations have been calculated from Agria Group Holding AD to the members of the company's Board of Directors: Position gross annual remuneration in BGN for 2022 Executive member of BoD and Executive Director Emil Raykov BGN 120 000 Member of BOD Deyan Ovcharov BGN 48 000 Member of BOD Stanimir Buzhev BGN 48 000 Member of BOD Daniela Taneva BGN 48 000 Member of BOD Anna Belchinska BGN 48 000 Remuneration received by members of the Board of Directors from companies belonging to the same group: Name Position gross remuneration in BGN for 2022 Anna Belchinska Manager of Korn Trade EOOD 183 381.34 Stanimir Buzhev Executive Director of Kristera AD 243 655.00 104 DECLARATION ON CORPORATE GOVERNANCE Gross remuneration of the members of the Board of Directors of AGRIA GROUP HOLDING AD for 2022 in BGN: Permanent remuneration Additional remuneration Total remuneration for 2022.: 1. EMIL VESELINOV RAYKOV 120 000,00 500 000,00 620 000,00 2. DEYAN ROSENOV OVCHAROV 48 000,00 48 000,00 3. STANIMIR RUSEV BUZHEV 48 000,00 48 000,00 4. DANIELA DIMITROVA TANEVA 48 000,00 48 000,00 5. ANNA DIMITROVA BELCHINSKA 48 000,00 48 000,00 TOTAL: 312 000,00 500 000,00 812 000,00 Note: The total amount of the additional remuneration of the members of the Board of Directors of the company does not include the payment of the independent directors, whose remuneration is a basic one without additional incentives. The senior management of Agria Group Holding AD, represented by corporate management, performs a key role and carries responsibility for the establishment of an internal control system and risk management and carries out routine monitoring in this direction. Agria Group Holding AD applies diversity policy regarding the administrative and managerial bodies of the Company in view of age, gender or education and professional experience. The persons in the administrative and managerial bodies of the issuer possess the required education, professional qualification, competency and experience to conduct the respective activity and meet the requirements of the Commercial Law, POSA and other legal norms and regulations referring to such a position and they are selected/respectively hired with no restrictions on age and gender. Through encouraging diversity, the Company reveals its social engagement and aims for stable development while observing legal requirements. The diversity policy is instrumental in the effective distribution of the functions and obligations of the corporate management while its structure and competency follow the principles of diversification and diversity within the obligatory professional and managerial competence and contributes for the effective operation of the Holding structure in the different types of operation of Agria Group Holding AD. Type of Operations of Agria Group Holding AD Agria Group Holding AD, through its subsidiaries, is engaged in the following types of business: 105 DECLARATION ON CORPORATE GOVERNANCE ● Agribusiness in North-Eastern Bulgaria. ● Processing industry (storage and processing of grain and oil- bearing cultures) centred in Lyaskovets. ● Trade/export operations near the Port of Varna. Main logistic centers – the towns of Popovo, Devnya and Varna. As a company carrying out activities in the public interest, in accordance with the Independent Financial Audit Act, Agria Group Holding AD in its capacity of public company, has elected through its competent body (GMS) an Audit Committee, whose members meet the legal requirements for performing this type of activity and whose activity, functions and reporting is in compliance with the decrees of the Independent Financial Audit Act. Guided by the principle for protection of shareholders’ rights, the corporate management of Agria Group Holding AD guarantees the equal treatment of all the Company’s shareholders (including minority and foreign shareholders) and carries out a policy for protection of rights and assistance to shareholders in exercising their rights by facilitating their effective participation in the work of the General Meetings by means of timely announcement of the materials for the GMS; implementation of clear procedures with regard to the convening and carrying out of General Meetings of Shareholders; preparation of rules regarding the representation of shareholders in the General Meeting; possibility for participation in the distribution of profits by the Company in the event that the General Meeting of Shareholders adopts a specific resolution on the distribution of dividend. Through the Investor Relations Director of Agria Group Holding AD the company pursues its overall policy for assisting shareholders in the exercise of all their rights. Pursuant to the principles of the National Code for Corporate Government and the good practices in the field of corporate governance, the corporate management follows a policy of balanced interaction between shareholders, management and interested parties. Agria Group Holding AD has a working system for inside control and risk management in place, which guarantees correct identification of risks related to the Company’s activity and supports their effective management, ensures the adequate functioning of the accountancy and information disclosure systems. Inside control components 106 DECLARATION ON CORPORATE GOVERNANCE Control environment 1. Control environment covers the following elements: a) Communication and embracing honesty and ethical values. Embracing honesty and ethical values includes actions on behalf of the management to eliminate or diminish the incentives or temptations which could suborn the personnel toward dishonest, unlawful or unethical actions. b) Competence. Competence means knowledge and skills necessary to execute the tasks determining the job description of an employee. c) Participation of the persons occupying operative management positions. Control awareness in the company is significantly influenced by the persons occupying operative management positions. The responsibilities of the persons working in management include supervision over the design of the model and the effective functioning of the warning procedures and processes for reviewing the efficiency of the Company’s inside control. d) Structure. The establishment of an adequate structure includes taking into consideration the main fields of competence and responsibilities and adequate hierarchy levels of accountancy and reporting. e) Attribution of responsibility and power. Attribution of responsibility and power includes the policy related to the relevant business practices, knowledge and experience of the main personnel and resources provided for performing their duties. It also includes the policies and communications guaranteeing that the personnel understands the goals of the company, understands how each individual’s actions are connected and contribute to these goals as well as who and in what manner is held accountable and responsible. f) Policy and practice related to human resources. The policy and practice related to human resources reveal important questions in view of Company control awareness. The standards for selecting the most qualified individuals – focusing on education, former professional experience, achievements and proof for honesty and ethical conduct, demonstrate the Company’s engagement to employ competent and promising employees. Promotions based on periodic assessments of results show Company’s engagement to promote qualified personnel to more responsible positions. Company’s risk assessment process 2. For the purposes of financial reporting the Company’s risk assessment process includes the manner of business risk identification by the management, which risks are essential for the preparation of a financial statement in accordance with the applicable for the company financial reporting framework; assesses their meaning and the likelihood of their 107 DECLARATION ON CORPORATE GOVERNANCE occurrence and makes decisions how to meet and manage them and how to evaluate the results. 3. Risk related to dependable financial reporting including outside and inside events, transactions and circumstances which can occur or have negative effect on the ability of the company to initiate, register, process and report financial data corresponding to the management statements for genuineness in the financial report. Risk can occur or change due to circumstances listed below: - Changes in the operational environment. Changes in legislation or in the operational environment can lead to change in pressure from the competition and different risks. - New personnel. New personnel can have different focus on inside control or different understanding on it. - New or renovated information systems. Substantial or fast changes in the information systems can change internal control related risks. - Fast growth. Substantial and fast expansions of business can limit control and increase the risk for defect in its operation. - New technologies. Introducing new technologies in the production processes or information systems can change internal control risks. - New business models, products and activities. Introducing new business fields or transactions and operations with which the company has little experience, can lead to new risks related to internal control - Corporate reorganization. Reorganization can be followed by cuts in employments and changes in supervision and obligations distribution, which can change internal control risks. - Expanding business abroad. Expansion or acquisition of businesses abroad lead to new and often unique risks which can affect internal control, e.g. additional or changed risks in result of exchange operations. - New accountancy standards and clarifications. Introducing new accountancy principles or changes in the accountancy principles can affect risks related to preparation of the financial statements. The Company has developed information system including related business processes referring to financial reporting and communication. The information system includes hardware, software, people, procedures and data and actively uses IT. The information system related to financial reporting includes financial reporting system and consists of methods and documentation which: - Identify and reflect all valid transactions and operations; - Describe in a timely manner the transactions and operation and detailed enough to allow appropriate classification for the purposes of financial reporting. 108 DECLARATION ON CORPORATE GOVERNANCE - Evaluate the transaction and operation in a manner allowing reflection in a fitting money value in the financial report. - Determine the timeframe during which the transactions and operation have arisen so that their reflection in the relevant financial report can be allowed. - Present in a fitting manner the transactions and operations and related disclosure in the financial report. Control measures 4. Control measures related to audit are categorized as policies and procedures and refer to the following: - Reviews on the execution and results. These control measures include reviews and analyses of the actual results in view of budgets, prognoses and results from previous periods; binding different data groups – operational or financial, together with analyses for interconnections and research and corrective measures; comparison of internal data with external sources of information; review on performance results. - Information processing - Physical controls. These activities include:  Physical security of assets, including measures for safekeeping, e.g. secure facilities and conditions for access to assets and documentation;  Restricted access to computer programs and files;  Periodic amount counting and comparing with the amounts reflected in the control documentation (e.g. comparing the cash counting results and the results from inventories with the accounting documents) - Separation of duties. Allocating the responsibilities for transactions and operations approval, registry and responsibility for the assets to different persons. The separation of duties aims to decrease the possibilities for a certain person to be in position to conduct or cover mistakes or fraud in their usual line of duties. Information under Art. 10 Para 1 Letters ‘c’, ‘d’, ‘f’, ‘h’ and ‘i’ from Directive 2004/25/EC of the European Parliament and of the Council dated 21 April 2004 regarding takeover. Para. 1, l. ‘c’ “Significant direct and indirect shareholdings (including indirect shareholdings through pyramid structures and cross-shareholdings) within the meaning of Article 85 of Directive 2001/34/EC ” Agria Group Holding AD does not possess direct or indirect shareholdings under Article 85 of Directive 2001/34/EC Para. 1, l. ‘d’ “T he holders of any securities with special control rights and a description of those rights ” Agria group Holding AD does not have holders of securities with special control rights. 109 DECLARATION ON CORPORATE GOVERNANCE Para. 1, l. ‘f’ “A ny restrictions on voting rights, such as limitations of the voting rights of holders of a given percentage or number of votes, deadlines for exercising voting rights, or systems whereby, with the company’s cooperation, the financial rights attaching to securities are separated from the holding of securities ” There are no restriction on voting rights in Agria Group Holding AD Para. 1, l. ‘h’ “T he rules governing the appointment and replacement of board members and the amendment of the articles of association” The rules governing the appointment and replacement of board members and the amendment of the articles of association are described in the Charter of Agria Group Holding AD Para. 1., l. ‘i’ “T he powers of board members, and in particular the power to issue or buy back shares ” The powers of board members are settled in the Constitution documents of Agria Group Holding AD. Agria Group Holding AD: Emil Raykov Executive Director 110 REPORT OF THE BOARD OF DIRECTORS OF AGRIA GROUP HOLDING AD ON THE APPLICATION OF THE REMUNERATION POLICY FOR THE COMPANY'S MEMBERS OF THE BOARD OF DIRECTORS, DRAWN UP IN COMPLIANCE WITH THE REQUIREMENTS OF ORDINANCE NO 48 OF THE FINANCIAL SUPERVISION COMMISSION AS OF 20TH MARCH 2013 ON THE REQUIREMENTS FOR THE REMUNERATIONS, ADOPTED BY A RESOLUTION OF THE ORDINARY GENERAL MEETING OF THE SHAREHOLDERS, HELD ON 29 TH SEPTEMBER 2020, AS AMENDED BY RESOLUTION OF AN ORDINARY GENERAL MEETING OF SHAREHOLDERS HELD ON 29TH JUNE 2021. The present report was prepared by the Board of Directors of AGRIA GROUP HOLDING AD in accordance with the provision of Art. 12 (1) and Art.13 of ORDINANCE No 48 of the Financial Supervision Commission of 20 March 2013 on the Requirements for the Remunerations and constitutes a separate document to the company's annual financial statements as at 31.12.2022. The report contains a review of the way in which the Remuneration Policy was enacted during 2022 and herewith is also attached information on the application of the Remuneration Policy for the next financial year. 1. Information about the decision-making process in elaborating the Remuneration policy, including, if applicable, information about the term and members of the Remuneration Committee, the name of the external consultants, whose services have been used in elaborating the Remuneration policy. The Remuneration policy for the members of the Board of Directors of AGRIA GROUP HOLDING AD, as well as any amendments and supplements thereto, is elaborated by the Board of Directors and approved by the General Meeting of Shareholders. Proposals for the adoption of a remuneration policy, respectively for amendments and / or supplements therein or for its revision are included and voted as a separate item on the agenda of the General Meeting of the shareholders of the company. A description and explanation of the significant changes and the way in which the vote results of the General Meeting have been taken into account, the opinions of the shareholders and the minutes of the General Meetings at which the remuneration policy was considered and voted are presented in an Appendix, which is an integral part of the policy, containing a Protocol for amendments or supplements to the remuneration policy. The present Policy was developed by the Company's Board of Directors in accordance with the procedure for adoption of decisions by the corporate board set out in the Company's Articles of Association. Pursuant to the regulatory requirements, the Policy was adopted by the Extraordinary General Meeting of Shareholders of AGRIA GROUP HOLDING AD, held on 29 th September 2020 and was amended by a resolution of an Ordinary General Meeting of Shareholders of Agria Group Holding AD held on 29th June 2021. All legal requirements and recommendation of the National Corporate Governance Code were taken into account in the development of the Remuneration policy for the members of the Board of Directors of AGRIA GROUP HOLDING AD. Under the Remuneration policy in force for the members of the Board of Directors of AGRIA GROUP HOLDING AD, the company has not set up a remuneration committee. When developing the Remuneration policy, the Board of Directors of AGRIA GROUP HOLDING AD have not used external consultants. The Remuneration policy for the members of the Board of Directors of AGRIA GROUP HOLDING AD aims to provide objective criteria for determining the corporate board's remuneration of the company with a view to attracting and retaining qualified and loyal members of the board and motivating them to work for the benefit of the company and its shareholders, as to avoid potential and actual conflicts of interest. During the reporting financial year AGRIA GROUP HOLDING AD has implemented the Remuneration policy for the members of the Board of Directors pursuant to the regulatory requirements for public companies, the 111 objectives, long-term interests and development strategy of the company, as well as its financial and economic standing in the context of the national and European economic environment, as taking into account the recommendations of the National Corporate Governance Code. AGRIA GROUP HOLDING AD has disclosed the Remuneration policy for the members of the Board of Directors through publishing it on the corporate website of the company. 2. Information about the relative weight of the variable and fixed remuneration of the members of management and controlling bodies Pursuant to the Remuneration policy in force for the members of the Board of Directors of AGRIA GROUP HOLDING AD, during the reporting financial year the Company paid to the members of the Board of Directors fixed remuneration, which certain amount has been approved by the General Meeting of Shareholders of the Company and considered: 1.1. The obligations and contribution of each member of the Board of Directors in the operations and results of the company; 1.2. The opportunity of recruiting and retaining qualified and loyal members of the Board of Directors; 1.3. Compliance of the interests of the Board members with the long-term interests of the company. The fixed remuneration of the members of the Board of Directors of AGRIA GROUP HOLDING AD is not based on the accomplished results. The volume of the fixed remuneration is in line with main activity of AGRIA GROUP HOLDING AD and the income from it, and taking into account that as a holding under the meaning of art. 277 and art. 278 of the Commercial Act, the income of the company mainly comprise dividents from subsidiaries controlled by the latter. In view of the financial and economic standing of the Company and the certain input of the members of the Board of Directors of AGRIA GROUP HOLDING AD, during the reporting 2022 the members of the Board of Directors received fixed remunerations, which certain amount was approved by the General Meeting of Shareholders of the Company. The amount of the permanent monthly remuneration of the members of the Board of Directors, was determined by a resolution of the Ordinary the General Meeting of Shareholders of AGRIA GROUP HOLDING AD,held on 29 th June 2021, is as follows: permanent monthly remuneration of the non-executive members of the Board of Directors in the amount of BGN 4,000; permanent monthly remuneration of the Executive Director in the amount of BGN 10,000. Remunerations for the members of the Board of Directors of AGRIA GROUP HOLDING AD set by the General Meeting of Shareholders, held on 29th June 2021: Position Full monthly remuneration in BGN Executive member of BoD and Executive Director Emil Raykov BGN 10 000 Member of BOD Deyan Ovcharov BGN 4 000 Member of BOD Stanimir Buzhev BGN 4 000 Member of BOD Daniela Taneva BGN 4 000 Member of BOD Anna Belchinska BGN 4 000 112 During the reporting financial year 2022 AGRIA GROUP HOLDING AD have paid additional remuneration to the executive director in the amount of BGN 500 000.00 which amount of remuneration was determined by the General Meeting of Shareholders held on 28th June 2022. Gross remuneration of the members of the Board of Directors of AGRIA GROUP HOLDING AD for 2022 in BGN: Permanent remuneration Additional remuneration Total remuneration for 2022.: 1. EMIL VESELINOV RAYKOV 120 000,00 500 000,00 620 000,00 2. DEYAN ROSENOV OVCHAROV 48 000,00 48 000,00 3. STANIMIR RUSEV BUZHEV 48 000,00 48 000,00 4. DANIELA DIMITROVA TANEVA 48 000,00 48 000,00 5. ANNA DIMITROVA BELCHINSKA 48 000,00 48 000,00 TOTAL: 312 000,00 500 000,00 812 000,00 The percentage ratio of the total amount of the permanent remunerations compared to the total amount of the remunerations of the members of the Board of Directors of Agria Group Holding AD for 2022 (constants plus variables) is 38.42%. The percentage ratio of the total amount of variable remuneration compared to the total amount of remuneration of the members of the Board of Directors of Agria Group Holding AD for 2022 (constants plus variables) is 61.57%. Therefore, fixed remuneration represents a sufficiently large part of the total remuneration (fixed and variable). Note: The total amount of the additional remuneration of the members of the Board of Directors of the company does not include the payment of the independent directors, whose remuneration is a basic one without additional incentives. 3. Information about the criteria for accomplished results, based on which, stock options, stocks of the Company or other types of variable remuneration are provided and an explanation how the criteria under Art. 14, Para 2 and 3 from Ordinance No 48 contribute to the long-term interests of the Company The Remuneration policy for the members of the Board of Directors of AGRIA GROUP HOLDING AD does not provide an option for granting company stocks, stock options and other appropriate financial instruments. The Remuneration policy of AGRIA GROUP HOLDING AD provide an option for additional variable remuneration to the members of the Board of Directors of Agria Group Holding AD. The total amount of the additional variable remuneration to the members of the Board of Directors (except for the independent directors who receive only base remuneration without additional incentives) is determed with a view to the financial- econonomic standing of the company, the input of the members of the Board of Directors and the accomplished results. 113 The criteria for achieved results are subject to encourage the stability of the Company in the long term and to also include non-financial indicators, which are essential for the long-term activity of the Company, for example compliance with the applicable rules and procedures. 4. Clarifications regarding the applied methods for assessment whether the criteria for accomplished results have been achieved According to the Remuneration policy for the members of the Board of Directors of AGRIA GROUP HOLDING AD, the members of the Board of Directors of Agria Group Holding AD can receive additional variable remunerations, which total amount depends on the financial-economic standing ot the company, the input of the members of BoD and the accomplished results of the activity. The variable remuneration is determined by the accomplished results of the activity on a consolidated basis. The total amount of the additional remuneration of the members of the Company’s Board of Directors (with the exception of the independent directors , whose remuneration is only fixed without additional incentives) is no more than 3% (three percent) of the net consolidated profit of Agria Group Holding AD for the corresponding financial year. The amount of the additional remuneration proposed as a maximum is based on the consolidated financial results, as the holding company does not directly engage in commercial activities but depends on the activity and results of its subsidiaries. The variable remuneration of the members of the Board of Directors is accrued and paid in compliance with financial and non-financial criteria for achieved results. The criteria for achieved results should promote the long-term stability of the company and include non-financial indicators that are relevant for the long-term activity of the company, such as compliance with applicable rules and procedures. The criteria related to financial indicators are selected in accordance with how they reflect the creation of value by the Company and how this relates to the market capitalization. Financial indicators may include criteria related to consolidated profit before taxes, interest and depreciation, growth in consolidated income, consolidated profit, efficiency and value of new business. The non-financial criteria are related to the clients egagements and employees of the company, operational efficiency and corporate social responsibility, contributing to the stable and sustainable development of the Company and the holding group in economic, social and environmental aspects. The regular remuneration must represent a sufficiently large proportion of the total remuneration so as to allow the company to apply a flexible policy on variable remuneration, including the option not to pay when the criteria for achieved results are not met and where there is a significant deterioration in the company's financial situation. 5. Clarification regarding the correlation between the remuneration and the accomplished results During the reporting financial year 2022 AGRIA GROUP HOLDING AD have paid additional remuneration to the executive director in the amount of BGN 500 000.00 which amount of remuneration was determined by the General Meeting of Shareholders held on 28 th June 2022. The variable remuneration is formed on the basis of achieved consolidated financial results, as the holding company does not perform direct commercial activity as it depends on the activity and results of its subsidiaries, subject to the upper limit of not more than 3% (three percent) of net consolidated profit for the financial year 2022 of Agria Group Holding AD. 6. Base remunerations and justification of the annual scheme for bonus payments and/or all other non- monetary additional remunerations 114 The General Meeting of Shareholders convened on 16 July 2014, the General Meeting of Shareholders convened on 16 July 2015, the General Meeting of Shareholders convened on 22 June 2016, the General Meeting of Shareholders convened on 27 June 2017, the General Meeting of Shareholders convened on 25 June 2018, the General Meeting of Shareholders convened on 19 June 2019 and the General Meeting of Shareholders convened on 29 July 2020, the General Meeting of Shareholders convened on 29 June 2021 and General Meeting of Shareholders convened on 28 th June 2022, did not determine additional remuneration to the members of the Board of Directors of AGRIA GROUP HOLDING AD through payment of bonuses and/or other non-monetary additional remunerations to the members of the company's corporate board. 7. Description of the main characteristics of the scheme for additional voluntary retirement insurance and information about the paid and/or due contributions by the Company in favor of the Director for the respective financial year, when applicable In terms of members of the Board of Directors of AGRIA GROUP HOLDING AD, there is no commitment on the part of the company in respect of additional voluntary pension insurance for board members and the company does not have liabilities for payment of contributions in favour of the directors for the reporting financial year. 8. Information regarding the deferment period for payment of variable remunerations The option for deferred payment of variable remunerations is in accordance with the mandatory provisions of the regulatory framework in force. 9. Information about the compensation policy upon contract termination Under the Remuneration policy of Agria Group Holding AD, the maximum amount of compensation payable by the company, other than the compensation payable by law (where applicable) in event of early termination of the contract with a member of the Board of Directors of Agria Group Holding AD, representing the company according to an entry in the Commercial Register at the Registry Agency, may not exceed the total amount of gross monthly remuneration payabe to them for the remainder of the period, but not more than 12 months. The amount of the compensation shall be fixed in the contract or an agreement between the parties and shall not exceed the amount specified in Remuneration policy. The Company is not liable for compensation in event of termination of a contract with a member of the Board of Directors of Agria Group Holding AD due to expiration and non-renewal of the term the member was elected for. The Company is not liable for compensetaion in event of early termination of the contract with a member of the BoD of Agria Group Holding AD due to failure to comply with the clause, which forbids the carry out of a competitive activity, or other failure to fulfill an obligation under the contract with a member of the BoD. the Company. During the reporting financial 2022 year a contract with a member of the Board of Directors has not been terminated. 10. Information about the period, during which the stocks cannot be transferred and the options on stocks cannot be exercised, concerning variable remuneration, based on stocks The current Remuneration policy for the members of the Board of Directors of AGRIA GROUP HOLDING AD does not provide such option. 11. Information about the policy for retaining a definite number of shares until the end of the term of the members of the management and controlling bodies after expiration of the period under item 10 The Remuneration policy in force for the members of the Board of Directors of AGRIA GROUP HOLDING AD does not provide such option. 115 12. Information about the contracts of the members of the management and controlling bodies, including the term of each contract, the notice period for termination and details regarding the compensations and/or other due payments in the event of early termination The Contracts with all members of the Board of Directors are entered for a period of five years as of July 2020. Information on compensations and/or other payments due in the event of early termination are presented in Item 9 of the present Report 13. Full amount of the remuneration and other incentives of the members of the management and controlling bodies for the respective financial year For 2022 the following remunerations have been calculated from Agria Group Holding AD to the members of the company's Board of Directors: Position gross annual remuneration in BGN for 2022 Executive member of BoD and Executive Director Emil Raykov BGN 120 000 Member of BOD Deyan Ovcharov BGN 48 000 Member of BOD Stanimir Buzhev BGN 48 000 Member of BOD Daniela Taneva BGN 48 000 Member of BOD Anna Belchinska BGN 48 000 During the reporting financial year 2022 AGRIA GROUP HOLDING AD have paid additional remuneration to the executive director in the amount of BGN 500 000.00 which amount of remuneration was determined by the General Meeting of Shareholders held on 28th June 2022. For 2022 the members of the Board of Directors of the Company have not received other material incentives from Agria Group Holding AD. 14. Information about the remuneration of each person, who has been a member of a management or controlling body of a public company for a certain period in the respective financial year: a) full amount of the paid and/or accrued remuneration of the person for the respective financial year For 2022 the following remunerations have been calculated from Agria Group Holding AD to the members of the company's Board of Directors: Position Gross annual remuneration in BGN for 2022 Executive member of BoD and Executive Director Emil Raykov BGN 120 000 Member of BOD Deyan Ovcharov BGN 48 000 Member of BOD Stanimir Buzhev BGN 48 000 Member of BOD Daniela Taneva BGN 48 000 Member of BOD Anna Belchinska BGN 48 000 During the reporting financial year 2022 AGRIA GROUP HOLDING AD have paid additional remuneration to the executive director in the amount of BGN 500 000.00 which amount of remuneration was determined by the General Meeting of Shareholders held on 28th June 2022. 116 In 2022 members of the Company' s Board of Directors have not received non-monetary benefits. The company does not have deferred or contingent liabilities arising during the year, even if the remuneration is due at a later stage As of 31.12.2022 AGRIA GROUP HOLDING AD does not owe amounts for payment of pensions or retirement benefits. b) remuneration and other material and non-material incentives received by the person from companies belonging to the same group Name Position gross remuneration in BGN for 2022 Anna Belchinska Manager of Korn Trade EOOD 183 381.34 Stanimir Buzhev Executive Director of Kristera AD 243 655.00 c) remuneration received by the person in the form of distribution of profit and/or bonuses and the reasons for their payment In 2022 no member of the Board of Directors of AGRIA GROUP HOLDING AD has received remuneration from the Company in the form of profit distribution and/or other bonuses from AGRIA GROUP HOLDING AD. d) any additional payments for services provided by the person beyond his usual functions when such payments are permitted under contract concluded with him The contracts with the members of the Board of Directors of AGRIA GROUP HOLDING AD do not provide payment for services beyond their usual functions. e) paid and/or accrued compensation on the occasion of termination of duties during the past financial year In 2022 compensations have not been paid and/or accrued on the occasion of termination of the functions of the Board of Directors of AGRIA GROUP HOLDING AD. f) overall assessment of all non-cash benefits, treated as remuneration, except for those pointed out under letters “a” - “e” In 2022 none of the member of the Board of Directors of AGRIA GROUP HOLDING AD has received non- cash benefits treated as remuneration than those specified under letters “a” – “e”. g) information on all loans granted, payments of welfare costs and guarantees on the part of the company or its subsidiaries or other companies subject to consolidation in the annual financial statements, including data on the remaining outstanding part and the interest As of the end of 2022, there are no active and unpaid cash loans from members of the Board of Directors of the company. In 2022, in respect of all of the members of the Board of Directors of AGRIA GROUP HOLDING AD, owes no payments of social and household expenses and guarantees from the company or its subsidiaries or other companies that are subject to consolidation in the annual his financial statement. 15. Information about stocks and/or stock options and/or other incentive schemes based on stocks: The Remuneration policy in force for the members of the Board of Directors of AGRIA GROUP HOLDING AD does not provide an option for granting stock options, company shares or other types of incentive schemes based on stock for members of the corporate board, respectively, such have not been paid or provided. 117 16. Annual change in the remunerations, the results of the company and the average volume of the remunerations of full-time employees, who are not directors, during the last at least 5 financial years, presented altogether in a way that can be compared 17. Information on exercising the option to request a refund of the variable remuneration The Company applies a flexible policy on variable remuneration, including exercising the option for the same to be refunded, when there is no compliance with the clause prohibiting the carry out of competition, due to other culpable failure to comply with the provisions of the management contract by a member of the Board, including significant deterioration of the financial situation of the company as a result of actions and transactions by a member of the Board of Directors, which significantly deviate from the market conditions, as well as actions of any nature harmful to the company. 18. Information on any deviations from the procedure for the implementation of the remuneration policy in connection with exceptional circumstances referred to in Article 11, para 13, including the explanation of the nature of the exceptional circumstances and the indication of the specific elements derogated from. During 2022 there are no exceptional circumstances in which the company has temporarily suspended the implementation of the Remuneration policy. Information on application of the Remuneration Policy of the members of the Board of Directors of AGRIA GROUP HOLDING AD for the next financial year As of the date of preparation of the present report the Board of Directors of Agria group holding AD has not observed a need to adopt any amendments to the Remunartion policy for the members of the Board of Directors, adopted and endorsed by the General Meeting of the company. The Board of Directors shall discuss the Remunaration policy at a session and propose amendments to it, if deemed necessary, at the forthcoming annual General Meeting of shareholders in 2023. 28th April 2023 ....................................................... Emil Raykov – executive member of the Board of Directors Of Agria Group Holding AD Year Number of persons 2015 2016 Change 2016 compared to 2015 % 2017 Cahnge 2017 compared to 2016 % 2018 Change 2018 compared to 2017 % 2019 Change 2019 compared to 2018 % 2020 Change 2020 compared to 2019 % 2021 Change 2021 compared to 2020 % 2022 Change 2022 compared to 2021 % Gross remuneration of all members of the BoD for the year 5 146 674,44 216 000,00 47,26% 216 000,00 0,00% 216 000,00 0,00% 216 000,00 0,00% 216 000,00 0,00% 564 000,00 161,11% 812 000,00 43,97% Average remuneration of a member of the BoD per year 5 29 334,89 43 200,00 47,26% 43 200,00 0,00% 43 200,00 0,00% 43 200,00 0,00% 43 200,00 0,00% 112 800,00 161,11% 162 400,00 43,97% Company results - profit х 1 951 827,60 3 085 836,77 58,10% 4 732 937,79 53,38% 1 839 640,29 -61,13% 628 057,65 -65,86% 2 016 819,99 221,12% 2 086 000,43 3,43% 42 181 441,46 1922,12% Gross remuneration on the basis of full time employees in the company who are not directors for the year 10 120 797,89 301 944,82 149,96% 330 464,59 9,45% 336 509,95 1,83% 339 154,92 0,79% 136 526,78 -59,75% 157 949,18 15,69% 238 300,46 50,87% Average remuneration on a full-time basis of employees in the company who are not directors for the year 10 17 256,84 43 134,97 149,96% 47 209,23 9,45% 48 072,85 1,83% 48 450,70 0,79% 19 503,83 -59,75% 15 794,92 -19,02% 23 830,05 50,87% 118 DECLARATION under Article 100n (4), Item. 4 of POSA We, the undersigned Emil Veselinov Raykov, in the capacity of Chairman of the Board of Directors and Executive Director of Agria Group Holding AD, and Asya Stancheva Yordanova, in the capacity of Accountant of Agria Group Holding AD, hereby declare that to the best of our knowledge: 1. The set of annual financial statements of 2022, prepared in compliance with the applicable accounting standards, provides true and fair information on the assets and liabilities, the financial standing and profit of Agria Group Holding AD and the companies included in the consolidation; 2. The report on the operations of Agria Group Holding AD for 2022 contains an accurate overview of the development and activity outcome of Agria Group Holding AD along with the state of the Issuer and the companies included in the consolidation, together with a description of the main risks and insecurities the Issuer is facing. Declarants: Emil Raykov – Executive Director ................................................... Asya Yordanova – Accountant .................................................... INDEPENDENT AUDITOR’S REPORT To the shareholders of Agria Group Holding AD Varna Report on the audit of the consolidated financial statements Qualified audit opinion 1. We have audited the separate financial statements of Agria Group Holding AD (the Group ), which comprise the consolidted statement of financial position as at December 31, 2022, the consolidted statement of profit or loss and other comprehensive income, consolidted statement of changes in equity and consolidted statement of cash flows for the year then ended, and notes to the consolidted financial statements, including a summary of significant accounting policies and other explanatory information. 2. In our opinion, except for the possible effects from the matters described in “Basis for qualified audit opinion” section of our report, the accompanying consolidated financial statements present fairly, in all material respects, the financial position of the Group as at December 31, 2022 and its financial performance and its changes in cash flows for the year then ended in accordance with the International Accounting Standards (IASs), approved for application by the European Commission (EC). Basis for qualified audit opinion 3. The Group has presented in the consolidated statement of changes in equity as at December 31, 2022 a revaluation reserve amounting to BGN 92,451 thousand. One part of this revaluation reserve, amounting to BGN 5,390 thousand as at December 31, 2022 has been derived from a one-time revaluation during previous reporting periods of part of land and buildings in two subsidiaries, which are owned by the Group, to their fair value. The fair value of these assets as at the date of their valuation was determined by independent appraisers with appropriate qualifications for such valuations. In our opinion, a one-time valuation on only part of land and buildings owned by the Group is not in accordance with IAS 16 Property, Plant and Equipment , which requires a group of non-current assets to be subsequently measured in the financial statements using the same valuation method, as well as to determine their fair value with sufficient frequency so as to present fairly the changes in the value of assets in different periods. Due to the specific way of determining the fair value of land and buildings, we are not able to estimate the value effect of such one-time valuation, amounting to BGN 5,390 thousand on their carrying value as well as on the revaluation reserve and the Group’s net assets as at December 31, 202 2. 2 4. We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Group in accordance with the Code of Ethics for Professional Accountants issued by the International Ethics Standards Board for Accountants (IESBA Code), and the ethical requirements of the Independent Financial Audit Act (IFAA) that are relevant to our audit of the financial statements in Bulgaria, and we have fulfilled our other ethical responsibilities in accordance with the requirements of IFAA and IESBA Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Emphasis of matter 5. We draw attention to the disclosure in Note 35, Other Disclosures: "In late February of the previous year, 2022, a military conflict began between Russia and Ukraine. As a result, normal trade relations with both affected countries have been severely disrupted. The European Union and many countries around the world have imposed a series of economic sanctions on Russia. The restrictive economic and financial measures could lead to changes in the prices of energy and other goods and services that are important to the development of the Bulgarian economy. This could indirectly have an adverse effect on the Group's operations in future reporting periods. Management is currently analyzing and monitoring all changes in events in order to identify protective and stabilization measures. The application of these measures is expected to mitigate the negative consequences of the military conflict to an extent that will not have a significant adverse impact on the future viability and ability of the Group to continue its operations as a going concern Our opinion is not modified concerning this matter. Key audit matters 6. Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements for the current period. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. Key audit matter How this key audit matter was addressed in our audit 1. Valuation of goods Valuation of goods in the Group is a key audit matter as the goods available as at the year- end are a material part of the total amount of available inventories. Also, a major part of the Group’s revenues is generated from sale of goods. The valuation of goods depends on market prices at which these goods are traded In this area, our audit procedures comprised: - evaluation whether the applicable accounting policy of testing inventories, and goods in particular, for impairment is adequate and is consistently applied by the Group; - check of the method for calculation of obsolete inventories and for evaluation of the opportunities for their future sale in terms of dynamic markets; 3 on the respective markets, and for this reason we have assessed this valuation as a risk. As disclosed in note 3.5. of the Notes to the consolidated financial statements, goods available as at the year-end are presented at the lower of the acquisition cost and their net realizable value, determined as the expected selling price in the ordinary course of business, less the estimated costs to sell. 2 . Valuation to fair value of owned agricultural land Note 3.1 and note 4 to the consolidated financial statements. The Group has chosen to measure the agricultural land it owns at fair value, as determined by an independent appraiser as at the date of the financial statements. The measurement of agricultural land is an essential matter for our audit, as it requires a significant level of judgement and at the same time, agricultural land comprises a significant part of the Group’s assets. We have identified the use of many assumptions in the preparation of the measurements as a significant risk. The Group’s policy is to use external independent appraisers at least once a year. The measurements of the properties contain assumptions, for example expected rental income, employment rates, information about market transactions, market assumptions, risks related to property development, etc. 3. Valuation of right-of-use assets, including related to them lease obligations, according to the application of IFRS 16 Note 3.10, 4, and 15. of the consolidated financial statements. The business model of the Group includes performing agribusiness, which is associated with rent of big cultivable plots of land. The - analysis of the adequacy of market data used by the Group in the tests for impairment of inventories; - tests of the effectiveness and consistency of application of the control procedures implemented in the Group regarding the valuation of inventories. Based on the procedures we performed, we have not found any overvalued inventories and goods in particular, and have not identified any indications of the need for material impairment. Our audit procedures in this area include:  studies on the objectivity, independence and expertise of the external appraisers;  we assessed the correctness of the input data contained in the appraisers’ reports;  we conducted a critical analysis of the major assumptions;  we performed additional procedures in order to assess the adequacy of the values received;  we inspected the completeness and adequacy of the disclosures made in the financial statements with regard to the measurement of agricultural land. Our audit procedures in this area include:  Recognizing of the process of concluding a rent contract, analysis of their terms and conditions and check of the correct classification, valuation and disclosure.;  Study and review the Group's internal rules to gain an understanding of key controls in significant business processes related to the rent of assets; 4 number of the contracts signed is significant, as the rent contract’s structure is complicated in terms of time for which they are concluded, as well as the conditions for renewal. The complicated time structure of the rent contracts signed, as well as their conditions have been identified by us as a significant risk, related to the correct classification, valuation and disclosure of assets with right of use and the related to them obligations, in accordance with the applications of IFRS 16  Procedures related to confirmation of fulfillment of the terms of the contracts;  Testing, through recalculation of certain calculations, used in determining the carrying amount of assets with right of use and the lease obligations, related to them.;  Analysis and valuation of used input data and significant estimates (discount rate, rent price, term of contract, etc.) in determining the amount of recognized assets and liabilities; Reviewing the completeness and adequacy of the disclosures in the consolidated financial statements to determine whether they comply with the requirements of IFRS 16. Information other than the consolidated financial statements and auditor’s report thereon 7. The management is responsible for the other information. The other information comprises the annual management report and the corporate governance statement prepared by the management in accordance with Chapter Seven of the Accountancy Act, but does not include the consolidated financial statements and our auditor’s report thereon , and this other information we received before the date of our audit report. Our opinion on the consolidated financial statements does not cover the other information and we do not express any form of assurance conclusion thereon, unless explicitly stated in our report and to the extent stated. In connection with our audit of the consolidated financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the consolidated financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. As described in paragraph 3 of “Basis for qualified audit opinion” section above, we were unable to estimate the value effect of the valuation in previous periods of a part of the land and buildings up to their their carrying value, respectively on the revaluation reserve and the Group’s net assets. As a result, we are unable to conclude whether the other information contains any significant misstatements in respect of these matters. Responsibilities of management for the consolidated financial statements 8. The management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with International Accounting Standards, endorsed for application by the European Commission and for such internal control as the management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. 5 In preparing the consolidated financial statements, the management is responsible for assessing the Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the management either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so. Those charged with governance are responsible for supervision of the financial reporting process in the Group. Auditor’s respons ibilities for the audit of the consolidated financial statements 9. Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with IFAA and ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements. As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional scepticism throughout the audit. We also: — identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. — obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group ’s internal control. — evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Management. — c onclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group ’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Group to cease to continue as a going concern. — evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation. — obtain sufficient appropriate audit evidence about the financial information of the entities or entities within the Group to express an opinion on the consolidated financial statements. We are responsible for 6 instructing, overseeing and performing the Group's audit. We have sole responsibility for our audit opinion. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards. From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated financial statements for the current period and are therefore the key audit matters. We describe these matters in our auditor's report unless a law or a regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication. Report on other legal and regulatory requirements Additional matters to report in accordance with the Accountancy Act and Public Offering of Securities Act 10. In addition to our responsibilities and reporting in accordance with ISAs described above in “Information other than the consolidated financial statements and auditor’s report thereon” section with respect to the annual management report and the corporate governance statement, we have performed the procedures, in addition to those required under ISAs, in accordance with the Guidelines of the professional body of certified public accountants and registered auditors in Bulgaria – the Institute of Certified Public Accountants (ICPA). These procedures refer to checks of the existence, form and content of this other information in order to support us in forming an opinion whether the other information contains the disclosures required by Chapter Seven of the Accountancy Act and by the Public Offering of Securities Act (Art. 100m, par. 10 of the POSA in conjunction with Art. 100m, paragraph 8 (3) and (4) of the POSA), applicable in Bulgaria. Opinion in connection with Art. 37, par. 6 of the Accountancy Act Based on the procedures we have performed, our opinion is that: a) The information included in the annual management report for the financial year presented in the consolidated financial statements corresponds to those consolidated financial statements on which we have expressed a qualified opinion in “Report on the audit of the consolidated financial statements” section above. b) The annual management report has been prepared in accordance with the requirements of Chapter Seven of the Accountancy Act and Art. 100m, par 7 of the Public Offering of Securities Act. 7 c) The declaration for corporate governance for the financial year presented in these consolidated financial statements, which is part of the annual management report, contains the information required by Chapter Seven of the Accountancy Act and Art. 100m, par. 8 of the Public Offering of Securities Act. Opinion in connection with Art. 100m, par 10 in conjunction to Art. 100m, par 8, points 3 and 4 of the Public Offering of Securities Act Based on the procedures performed and the knowledge and understanding obtained of the Group ’s activities and the environment in which it operates, in our opinion, the description of major characteristics of the Group ’s internal control and risk management systems relevant to the financial reporting process which is part of the corporate governance statement and the information under Art. 10 paragraph 1(c), (d), (f), (h) and (i) of Directive 2004/25/EC of the European Parliament and the Council of 21 April 2004 on Takeover Bids, do not contain any material misrepresentations Reporting on compliance with the electronic format of the consolidated financial statements included in the annual consolidated financial statements for the activity under art. 100n, para 5 of Public offering of securities Act (POSA) with the requirements of EEEF Regulation We are committed to expressing a reasonable degree of certainty regarding the compliance of the electronic format of the consolidated financial statements of Agria Group Holding AD for the year ending December 31, 2022, attached to the electronic file „8945006WNW5407G58156-20221231-BG- CON.zip “,, with the requirements of Commission Delegated Regulation (EU) 2019/815 of December 17, 2018 supplementing Directive 2004/109 / EC of the European Parliament and of the Council through regulatory technical standards on the definition of the uniform electronic reporting format "EEF Regulation" ). Our opinion is only regarding the electronic format of the consolidated financial statements and does not cover the other information included in the annual consolidated financial statements for the activity under Art. 100n, para. 5 of the POSA. Description of the subject and applicable criteria The management has prepared an electronic format of the consolidated financial statements of the Group for the year ended December 31, 2022 under the EEEF Regulation in order to comply with the requirements of the POSA. The rules for the preparation of consolidated financial statements in this electronic format are set out in the EEEF Regulation and, in our view, have the characteristics of appropriate criteria for forming a reasonable assurance opinion. Responsibilities of management and those charged with governance The management of the Group is responsible for applying the requirements of the EEEF Regulation when preparing the electronic format of the consolidated financial statements in XHTML. These responsibilities include the selection and application of appropriate iXBRL markings using the taxonomy of the EEEF Regulation, as well as the introduction and implementation of such internal control system as management deems necessary for the preparation of the electronic format of the Group's annual consolidated financial statements. does not contain significant inconsistencies with the requirements of the EEEF Regulation. 8 The persons in charge of general management are responsible for overseeing the process of preparing the Group's annual consolidated financial statements, including the implementation of the EEEF Regulation. Auditor's responsibilities Our responsibility is to express an opinion on the reasonable level of certainty as to whether the electronic format of the consolidated financial statements is in conformity with the requirements of the EEEF Regulation. To this purpose, we have complied with the Guidelines on the Audit Opinion on the Implementation of the Single European Electronic Format (EEEF) for the Financial Statements of Companies "whose securities are admitted to trading on a regulated market in the European Union (EU)" of the professional organization. of Registered Auditors in Bulgaria, Institute of Certified Public Accountants (ICPA) "and we have committed to expressing a reasonable level of assurance in accordance with IAS 3000 (revised) Assurance Exercises Other than Audits and Reviews of Historical Financial Information" ( IPSAS 3000 (revised)) “Assurance engagements other than audits and reviews of historical financial information” (IAS 3000 (revised)). This standard requires us to comply with ethical requirements, plan and perform appropriate procedures to obtain reasonable assurance whether the electronic format of the Group's consolidated financial statements has been prepared in all material respects in accordance with the applicable criteria set out above. The nature, timing and scope of the procedures selected depend on our professional judgment, including the assessment of the risk of material non-compliance with the requirements of the EEEF Regulation, whether due to fraud or error. A reasonable level of assurance is a high level of assurance, but there is no guarantee that a commitment made in accordance with IAS 3000 (revised) will always reveal a material non-compliance where applicable. Requirements for quality control We apply the requirements of the International Standard on Quality Management (ISQM) 1 and, accordingly, maintain a comprehensive quality control system, including documented policies and procedures regarding compliance with ethical requirements, professional standards and applicable legal and regulatory requirements for registered auditors in Bulgaria. We meet the ethical and independence requirements of the International Code of Ethics for Professional Accountants (including International Standards of Independence) of the International Ethics Standards Board for Accountants (CMSA Code), adopted by institute of Certified Public Accountants (ICPA) through Independence Financial Audit Act (IFAA). Summary of work performed The purpose of the procedures planned and performed by us was to obtain a reasonable degree of assurance that the electronic format of the consolidated financial statements has been prepared, in all material respects in accordance with the requirements of the EEEF Regulation. As part of our assessment of compliance with the EEEF Regulation's electronic (XHTML) format for reporting on the Group's consolidated accounts, we maintained professional skepticism and used professional judgment. We also: — comprehensed the internal control and the processes related to the implementation of the EEEF Regulation regarding the consolidated financial statements of the Group and including the preparation 9 of the consolidated financial statements of the Group in XHTML format and its marking in machine readable language (iXBRL); — checked if the applied XHTML format is valid; — checked whether the human readable part of the electronic format of the consolidated financial statements corresponds to the audited consolidated financial statements; — assessed the completeness of the markings in the consolidated financial statements of the Group in the use of machine-readable language (iXBRL) in accordance with the requirements of the EEEF Regulation; — assessed the appropriateness of the iXBRL markings selected from the main taxonomy used, as well as the creation of an extended taxonomy element in accordance with the EEEF Regulation where there is no appropriate element in the basic taxonomy; — assess the appropriateness of the correlation (fixation) of the elements of the extended taxonomy in accordance with the EEEF Regulation. We believe that the evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Opinion on the compliance of the electronic format of the consolidated financial statements with the requirements of the EEEF Regulation In our opinion, based on the procedures performed by us, the electronic format of the consolidated financial statements of Agria Group Holding AD for the year ended 31 December 2022, on which the consolidated financial statements we express a modified audit opinion contained in the attached electronic file 8945006WNW5407G58156-20221231-BG- CON.zip“,” has been prepared in all essential aspects in accordance with the requirements of the EEEF Regulation. Reporting according to art. 10 of Regulation (EU) No 537/2014 in connection with the requirements of Art. 59 of the Independent Financial Audit Act According to the requirements of the Independent Financial Audit Act in connection with Art. 10 of Regulation (EU) No 537/2014, we also report the following i nformation. Primorska Audit Company Ltd. has been appointed as the mandatory auditor of the consolidated financial statements for the year ending 31 December 2022 of Agria Group Holding AD (the Group) by the general meeting of the Group held on 28 June 2022, for a period of one year. The auditor engagement was accepted by letter dated 9 August 2022. The audit of the consolidated financial statements for the year ended December 31, 2022 of the Group represents the first full ongoing engagement to a statutory audit of this entity performed by us. We confirm that the audit opinion expressed by us is in accordance with the additional report submitted to the audit committee of the Group, in accordance with the requirements of Art. 60 of the Independent Financial Audit Act. We confirm that we have not provided the information specified in Art. 64 of the Independent Financial Audit Act prohibited services outside the audit. 10 We confirm that in performing the audit we remained independent from the Group. For the period covered by our statutory audit, other than the audit, we have not provided services to the Group and its controlled entities that are not specified in the Group's activity report or consolidated financial statements. Audit company Primorska Audit Company OOD Registration number 086 Iliya Iliev Managing partner Marian Nikolov Registed auditor, responsible for the audit Registration number 0601 April 28, 2023

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