Enea S.A. — Management Reports 2016

Mar 5, 2016

Current Report No.: 11/2016

Date of preparation: 04.03.2016

Short name of issuer: Enea S.A.

Subject: The notification about the intention to disclose the results ofallocation of the acquisition price of the controlling interest inLubelski Węgiel Bogdanka S.A. in 2015 consolidated financial statements

Legal basis: Article 56 item 1(1) of the Act on Offerings - confidentialinformation

Content of report:

The Management Board of Enea S.A. (Issuer, Company) reports that inrelation to the conclusion of works related to the allocation of theacquisition price of the controlling interest of 64.57% of shares ofLubelski Wegiel Bogdanka S.A. (LWB) by Enea S.A., in accordance withIFRS 3, on 4 March 2016 a decision was made on performing the recognisedasset carrying value write-downs.

As a result of the allocation of the acquisition price of LWB thegoodwill item was recognised in the value of PLN 50.2 mln which wasattached to the potential possibility of LWB's obtaining a mininglicence for new coal deposits. However, taking into account the generalsituation on the coal market and the fact that LWB's present recoverablereserve enables the exploitation of the existing coal deposit until2039, the Management Board of Enea S.A. decided to write off thecompany's total goodwill established as a result of the transaction.

LWB's acquisition price settlement resulted in the recognition of theassets due to non-market terms of the agreement for coal acquisitionconcluded between Enea Wytwarzanie Sp. z o.o. and LWB. The Agreementforesees a formula at which the coal price is calculated if next pricenegotiations do not result in the final determination of the price forthe next settlement period. The price calculated based on the saidAgreement significantly diverges from the existing market conditions andtherefore the resultant assets totalling to PLN 94 mln calculatedaccording to IFRS 3, was applied to the other operating expenses of 2015.

At the same time, the Issuer points out that the above mentionedoperation is only of an accounting nature and has no impact on theliquidity situation of the Company and its Capital Group. The Companyreserves that the values presented above are only estimates and maychange. The final results of the acquisition price allocation will bepresented in the financial statements of Enea Capital Group for 2015,which are planned for publication on 21 March 2016.