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Ericsson Nikola Tesla d.d.

Quarterly Report Apr 29, 2021

2119_10-q_2021-04-29_11e90cc5-fed7-45b0-a44d-d0614f2a940f.pdf

Quarterly Report

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PRESS INFO April 29, 2021

ERICSSON NIKOLA TESLA d.d. Krapinska 45 10000 Zagreb

SECURITY: ERNT (ISIN: HRERNTRA0000) LEI: 5299001W91BFWSUOVD63 HOME MEMBER STATE: Republic of Croatia REGULATED MARKET SEGMENT: Regular market of the Zagreb Stock Exchange

Ericsson Nikola Tesla Group

Management Report on the Company and Ericsson Nikola Tesla Group business performance with comments on the financial results for Q1 2021

Highlights:

  • Sales revenue: MHRK 445.9
  • Gross margin: 14.2%
  • Operating profit: MHRK 45.3
  • Profit before tax: MHRK 48.4
  • Net profit: MHRK 40.8
  • Cash flow from operating activities: MHRK 22.6

Gordana Kovačević, the President of Ericsson Nikola Tesla, commented:

"In Q1 2021, the life and business in Croatia and globally were strongly impacted by the continued spread of the COVID-19 pandemic. Considering the persistence of extraordinary circumstances in which we operate, Ericsson Nikola Tesla Group realized solid business results. Compared to Q1 2020, sales revenue is lower by 8.6% and amount to MHRK 445.9, as a result of cyclical investments of our main customers in the networks, while gross margin improved to 14.2% (10.2%), primarily due to lower transition and transformation costs and the effect of cost-efficiency program. With a share of 60.1% in the total revenue generated in export markets, the company remains one of the largest Croatian exporters.

In regard to investments/ plans for 2021, telecom operators on the domestic market announced continuation of investments in infrastructure, high-speed Internet coverage and 5G. By implementing these plans, the domestic telecom operators, as well as the overall telecommunication market, follow European and global trends that in spite of pandemic, but also because of it, show the direction of accelerated development of communication technologies and services. The beginning of the full implementation of 5G in Croatia is expected in Q3 2021, after HAKOM assigns the necessary radio frequency spectrum. Therefore, we are especially pleased that we have signed a new five-year agreement with A1 Hrvatska. Thus we have continued to be the supplier of the radio part of the mobile network of this operator and at the same time a strategic partner in the field of 5G technology.

PRESS INFO

April 29, 2021

With the strategic partner Hrvatski Telekom, we continue to cooperate on all projects contracted during 2020. We would like to single out Management Services Agreement for the construction and maintenance of fixed and mobile telecommunications infrastructure which is carried out by our subsidiary Ericsson Nikola Tesla Servisi d.o.o., as well as the cooperation agreement in the field of radio access networks with emphasis on 5G. In the segment of ICT solutions for Industry and Society in the domestic market, we have signed new agreements with the Croatian Ministry of the Interior, the Croatian Ministry of Justice and Public Administration, and State Geodetic Administration.

In export markets, sales revenue is lower year-over-year due to the dynamics of operators' investments in networks, and along with the challenges brought by COVID-19 pandemic, the realization of projects is aggravated by the political and economic situation in some markets. Our activities in these markets continue with a strong focus on risk mitigation. The implementation of the Central Software Platform for the Centralized e-Health System of the Republic of Belarus, which is financed by a loan from the International Bank for Reconstruction and Development within the World Bank project, is ongoing as planned.

The delivery of services to Ericsson is stable. At the regular semi-annual R&D Management Business Review meeting, our Research and Development Center (R&D) confirmed the position of highly evaluated center in the global organization, with a customer satisfaction level of more than 90%. The evaluations in all categories are very high, and represent an increase in comparison to a previous evaluation, which proves that even in extraordinary circumstances, Ericsson Nikola Tesla's R&D Center continues to build positive perception within global Ericsson and contribute to the results of our company.

The strength of Ericsson's 5G portfolio was recently confirmed by Gartner report, naming Ericsson a leader in 5G network infrastructure for communications service providers. With over 130 commercial 5G agreements with communication service providers and 85 live 5G networks worldwide, consulting firm Frost & Sullivan in its latest report Frost Radar™ also named Ericsson the leader in the global 5G network infrastructure market in 2020.

By creating innovative solutions, based on the capabilities provided by the modern information-communication technology, Ericsson Nikola Tesla Group enables digital transformation of other industries, but also society itself. In this way, we create new opportunities for our customers and their end users, and through continuous internal transformation we secure the sustainability and competitiveness of our business. Through close cooperation with our customers we create solutions that speed up processes and contribute to a more quality work. As an example, the solution MOST (Managed Operations Support Tool) needs to be mentioned, which is our tool for monitoring the delivery of services to our strategic partner Hrvatski Telekom. By putting this tool into operation in this quarter, an important step was made in the realization of this complex project in which many experts from Ericsson Nikola Tesla and Ericsson Nikola Tesla Servisi have participated, as well as experts from Hrvatski Telekom. By integrating several previously used tools into one, which is also connected to the customer's relevant IT system, we simplify business and achieve a high level of quality.

A recent survey conducted on a sample of joint stock companies with over 500 employees verified the importance that these companies attach to the significance and risks of climate change. The results confirm the correctness of linking our goals in the field of sustainability and corporate responsibility with the strategic determinants of the company. Special emphasis was placed on the best practice that our company has in reporting on climate change at the highest management level; leadership in reporting about the risks of negative impact on the climate ; practice of reporting on business opportunities linked to climate, and leadership in reporting on climate change mitigation. Following our strategic orientation and concrete activities in a form of calculating our own carbon footprint, which comes mostly from energy consumption and transport, to a successful realization of the energy

efficiency project at Ericsson Nikola Tesla, we are ready for new challenges. In this sense, a key goal in the field of positive impact on climate change has already been defined - to reduce our CO2 emissions by 50% by 2030.

In Q1 2021, intensive vaccinations against COVID-19 began in Croatia and worldwide. Unfortunately, the increase in the number of infected people in Croatia and globally, and the fact that the vaccination is progressing in a slower pace than expected, results in constant updating of local /global restrictive measures to limit the flow of people and goods, which affects business planning and requires great flexibility. Therefore, as main risks, we see the ramp-down of the existing contracts realization, decrease/postponement of investments, restrictions in travelling, delays in equipment delivery due to reduced production and logistics capacities as well as physical and mental health of employees. With the primary focus on the safety, health and well-being of our employees, customers, partners and suppliers, we remain focused on risk management, profitability, and operating cash flow.

The global pandemic has significantly increased the need for networking and communication resulting in strong data traffic growth and increased awareness of the need for faster digital transformation of society with an emphasis on the digitalization of public services. Therefore, in 2021 we will continue to invest in 5G and new technologies, digital transformation of the Group, retaining key people and attracting new talents and developing competencies, because only through technological leadership and with highly qualified experts we can create and implement modern ICT solutions that contribute to digital transformation with positive impact on industry, society and individuals. "

Financial Highlights for the Group:

  • Sales revenue amounted to MHRK 445.9 (Q1 2020: MHRK 487.7), 8.6% lower year-over-year. Of the total sales revenue, the domestic market accounted for 39.9%, services to Ericsson accounted for 48.7%, while other export markets accounted for 11.4%.
  • Sales in the Networks segment amounted to MHRK 219.9 (Q1 2020: MHRK 303.7), Digital Services amounted to MHRK 118.8 (Q1 2020: MHRK 103.1), Managed Services amounted to MHRK 105.4 (Q1 2020: MHRK 78.8), and Emerging Business and Other amounted to MHRK 1.7 (Q1 2020: MHRK 2.0).
  • Gross profit amounted to MHRK 63.1 (Q1 2020: MHRK 49.7), up by 26.9% year-over-year, due to lower transition and transformation costs, and the impact of cost-efficiency program. Gross margin increased to 14.2% (Q1 2020: 10.2%).
  • Selling and administrative expenses increased by 2.8% year-over-year to MHRK 21.8 (Q1 2020: MHRK 21.2), due to increased presales activities related to 5G radio access and core networks, and broadband network implementation projects.
  • Operating profit increased by 35.2% year-over-year to MHRK 45.3 (Q1 2020: MHRK 33.5), as a result of significant increase of gross profit.
  • Gain from financial activities amounted to MHRK 3.2 (Q1 2020: MHRK 1.1) because of positive exchange differences.
  • Profit before tax increased by 40.1% year-over-year to MHRK 48.4 (Q1 2020: MHRK 34.6).
  • Net profit amounted to MHRK 40.8 (Q1 2020: MHRK 29.6) up by 38.2% year-over-year. Return on sales (ROS) was 9.2% (Q1 2020: 6.1%).

PRESS INFO

April 29, 2021

  • Cash flow from operating activities amounted to MHRK 22.6 (Q1 2020: MHRK 18.1) positively impacted by solid collection of receivables from certain customers
  • Working Capital Efficiency, expressed in WCD, was 18 days (Q1 2020: 44 days), and excluding services to Ericsson, Working Capital Efficiency was 32 days (Q1 2020: 101 days). Improvement in Working Capital Efficiency is due to completion of demanding network modernization projects which required longer and intensive engagement of material and human resources.
  • Total cash and cash equivalents, including short term financial assets, as at March 31, 2021 amounted to MHRK 338.0 (32% of the total assets), while at the end of 2020, they amounted to MHRK 314.0 (31.6% of the total assets). Total cash increased slightly due to lower outflows from operating activities as well as less investment outflows / activities in the quarter.
  • As at March 31, 2021, the Group had a solid balance sheet with total assets of MHRK 1,038.5, up by 4.4% compared to the end of 2020. The increase in the balance sheet is mostly due to the increase in work in progress (WIP) due to the dynamics of contract execution, new receivables, as well as a slightly lower cash outflows in the quarter. Equity ratio amounted to 37.3% (end of 2020: 34.8%).
  • With related parties, the transactions were as follows: sales of products and services amounted to MHRK 216.1 (Q1 2020: MHRK 217.6), while procurement of products and services amounted to MHRK 60.6 (Q1 2020: MHRK 123.3).
  • As at March 31, 2021, balances outstanding with related parties were as follows: receivables amounted to MHRK 95.2 (end of 2020: MHRK 89.0), and payables amounted to MHRK 29.8 (end of 2020: MHRK 10.9).

Business situation in major markets

In the domestic market, sales revenue amounted to MHRK 178.0 (Q1 2020: MHRK 199.9), down by 10.9% year-over-year.

During Q1 2021, the cooperation between Hrvatski Telekom and Ericsson Nikola Tesla Group has continued on all strategic projects, contracted during 2020. The cooperation is realized through intensive planning of activities for the investment period until the end of 2021, and a continuous realization in line with the announced plans, which aims to further connect society and create the prerequisites for the development of smart industries, modern cities and the society of the future.

Based on the Management Services Agreement for the construction and maintenance of fixed and mobile telecommunications infrastructure, supervision of the telecommunications network, and field maintenance of the active access and passive network, signed by Ericsson Nikola Tesla Servisi d.o.o., we will continue with the realization of FTTH in the network of Hrvatski Telekom. During 2020 alone, optical infrastructure was deployed to over 75,000 new households.

The implementation of the state-of-the-art Ericsson technology in the domain of radio access network and 5G continues, based on the cooperation agreement in which Ericsson Nikola Tesla d.d. is the supplier of the radio part of mobile network. At the same time, through deliveries related to the modernization of microwave transmission technology, based on the contract signed in mid-December 2020, intensive work was done to achieve all the necessary preconditions for the introduction of 5G in rural and hard-to-reach areas, including islands.

5G network of Hrvatski Telekom currently operates on the technology of Dynamic Spectrum Sharing (DSS), the application of which enables the use of the existing frequencies for 5G and a quick implementation of 5G network.

In March 2021, Hrvatski Telekom in cooperation with Ericsson Nikola Tesla d.d., was the first to also start including commercial users in testing on the 3.5 GHz frequency.

A new five-year contract on further development of the radio part of the mobile network of this operator was signed with the strategic partner A1 Hrvatska. The implementation of the contract will provide users with the state-of-the-art and secure radio access technology, and the highest quality standards in the development of 5G infrastructure will support the advanced user experience and the implementation of very high capacity networks at the national level. New capacities will be built on 4G technology and all the existing equipment on base stations will be modernized to 5G technology. The new 5G network will offer an open platform for innovation and a range of new business opportunities in various industries.

With the mobile operator Telemach Hrvatska, we have been working on the expansion of capacities of core network, and maintenance of core and transport network.

In the segment of ICT solutions for Industry and Society, an agreement was signed with the Ministry of the Interior of the Republic of Croatia related to the continuation of the Green Borders project, which aims to establish the surveillance of the state border in line with Schengen rules. In this area, a contract related to stationary systems was signed, which refers to equipping additional locations with video equipment and software that functionally comply with the Schengen rules.

A contract was signed with the Croatian Ministry of Justice and Public Administration for services of improvement, refinement, and upgrade of ZUP IT systems and user education. Contracted work includes the development of IT systems to support process and quality management in public administration.

Successful cooperation with the State Geodetic Administration continued with the signing of a contract for geoinformatics services on the establishment of a building register for the area of Varaždin County and the development of a multi-purpose information system for the building register.

In export markets (Ericsson market excluded) sales revenue decreased by 21.1% year-over-year to MHRK 50.8 (Q1 2020: MHRK 64.4) due to the dynamics of operators' investments in networks. In addition to negative impact of COVID-19 pandemic, the political and economic crisis in some export markets makes business more difficult.

With the operator HT Eronet (Bosnia and Herzegovina), we have been working on the build and modernization of LTE network across Bosnia and Herzegovina. We have also continued the activities on the modernization and maintenance of telecommunications networks with the operators Crnogorski Telekom (Montenegro) and IPKO (Kosovo). In Belarus, LTE network expansion projects are being implemented with the operator beCloud, and activities on the expansion of the transmission network are underway with A1 Belarus.

In ICT for Industry&Society, the activities related to the implementation of the Central Software Platform for the Centralized e-Health System of the Republic of Belarus are ongoing as planned. Our teams are finishing the realization of the first phase that includes the solution design, on which the national platform will be built on.

In Ericsson market, sales revenue amounted to MHRK 217.1 (Q1 2020: MHRK 223.4), down by 2.8% yearover-year.

Ericsson Nikola Tesla's R&D Center started 2021 with excellent results, highly recognized from all stakeholders on Management Business Review held in March. All work and deliveries are going according to plan. In business segment Networks, significant number of features related to classic and 5G products are ongoing at the same time building competence of new teams. Within the business area Digital Services, new responsibilities and complete operations in the area of Home Location Register were successfully transferred to R&D center. In the area Mobile Switching Center, development of feature modernization concluded with successful demo. Cloud development activities verified new features and Centralized User Database continued features development and verification according to plan. In Service Area Networks, Wireline and Legacy, number of customer support

activities were successfully executed.

Ericsson Nikola Tesla Group's experts from the Center for Services and Solutions Center for Networks are included in the activities of integration and optimization of various technologies for Ericsson customers in the United Kingdom, Germany, Sweden, Ireland, Spain, Denmark, Norway, Belgium, Czech Republic, Lithuania, Greece, Malta, Canada, Saudi Arabia, Japan, Indonesia, Malaysia, Taiwan, Hong Kong, etc.

We have continued to work on the development and implementation of software tools for management and optimization of mobile networks (SRS/Smart Rollout Support, ESI/Ericsson Site Integration, RAMT/Rehoming Automation Management Tool, RNPT/ Radio Network Proposal Tools & Gynt) that are used in the network rollout by many operators worldwide, with which Ericsson and Ericsson Nikola Tesla do business.

Experts from Services and Solutions Center in the field of Digital Services, Media and Operations, in addition to projects for the customers of Ericsson Nikola Tesla Group, were also engaged on projects for Ericsson customers in the United Kingdom, Germany, Sweden, Switzerland, Denmark, Finland, France, Luxembourg, Ireland, Norway, Lithuania, Italy, Czech Republic, Australia, Tahiti, Pakistan etc. These are complex projects of introduction of 5G technology, operational and business support systems, as well as projects of introduction of core solutions in Cloud.

The teams working in IT& Engineering Services, in addition to providing excellent support and achieving excellent results on test environment management projects and IT operations for Ericsson corporation, also have a key role in our company's transformation processes, and provide a quality support for smooth work from home and remote support to customers.

In the segment ICT solutions for Industry and Society, in addition to numerous projects for Ericsson Nikola Tesla's customers, quality results are also achieved on projects in the field of IoT platforms and Connected Urban Traffic for the needs of Ericsson corporation.

Other information

At the meeting held on April 23, 2021, Ericsson Nikola Tesla Supervisory Board and Managing Director made a joint proposal to the company's General Meeting to adopt a decision regarding the dividend payment of HRK 82 per share.

Ericsson Nikola Tesla's General Meeting will be held on June 29, 2021. The shareholders who have the Company shares registered on their securities account in the Central Depository & Clearing Company on July 02, 2021 are entitled to dividend payment. Ex-dividend date is July 01, 2021.

Number of
shares
% of share capital
Telefonaktiebolaget LM Ericsson 653,473 49.07
Addiko Bank d.d. / Raiffeisen mandatory pension fund, B category 123,514 9.28
OTP banka d.d. / Erste Plavi mandatory pension fund, B category 53,680 4,03
Addiko Bank d.d. / PBZ Croatia osiguranje mandatory pension fund,
B category
40,458 3.04
PBZ d.d. / The Bank of New York as Custodian 12,619 0.95
OTP banka d.d. / OTP Index fund - open-end alternative investment
fund with public offering
9,474 0.71
PBZ d.d. / custodian client account 8,949 0.67
Addiko Bank d.d. / Raiffeisen voluntary pension fund 8,094 0.61
Vuleta Ivica 4,761 0.36
Addiko Bank d.d. / Raiffeisen mandatory pension fund, A category 3,668 0.28
Other shareholders 412,960 31.00

Ericsson Nikola Tesla major shareholders (as at March 31, 2021)

Share price information in Q1 2021:

Highest (HRK) Lowest (HRK) Closing (HRK) Market cap. (in MHRK)
1,650.00 1,500.00 1,590.00 2,117.3

PRESS INFO April 29, 2021

Ericsson Nikola Tesla d.d. Krapinska 45 Zagreb

OIB: 84214771175

Pursuant to the Articles 462 to 468 of the Capital Market Law (Official Gazette 65/18) the Managing Director of the joint stock company Ericsson Nikola Tesla d.d. Zagreb, Krapinska 45 gives the following:

Statement

of the Management Board responsibility

The accompanying consolidated and non-consolidated financial statements have been prepared in compliance with the International Financial Reporting Standards (IFRS). The financial statements also comply with the provisions of the Croatian Financial Accounting Law valid as of the date of these financial statements.

Unaudited financial statements for the period January 1, 2021 to March 31, 2021 present a true and fair view of the financial position of the Company and the Group and of the financial performance and cash flows in compliance with applicable accounting standards.

Managing Director:

Gordana Kovačević, MSc

PRESS INFO April 29, 2021

For additional information, please contact:

Snježana Bahtijari Orhideja Gjenero Company Communications Director Investor Relations Manager Ericsson Nikola Tesla d.d. Ericsson Nikola Tesla d.d. Krapinska 45 Krapinska 45 HR-10 002 Zagreb HR-10 002 Zagreb Tel.: +385 1 365 4556 Tel.: +385 1 365 4431 Mob.: +385 91 365 4556 Mob.: +385 91 365 4431 Fax: +385 1 365 3156 Fax: +385 1 365 3156 E-mail: [email protected] E-mail: [email protected]

E-mail: [email protected]

For more information about Ericsson Nikola Tesla's business, please visit: http://www.ericsson.hr

Ericsson Nikola Tesla d.d. Consolidated statement of comprehensive income

for the period ended 31 March 2021

2021 2020
HRK '000 HRK '000
Sales revenue 445.858 487.663
Cost of sales -382.732 -437.932
Gross profit __
63.126
__
49.731
Selling expenses -10.617 -11.002
Administrative expenses -11.201 -10.226
Other operating income 4.074 5.054
Other operating expenses -116 -71
Operating profit __
45.267
__
33.486
Finance income __
3.510
__
2.206
Finance expense -338 -1.128
Finance income/(expense) – net __
3.172
__
1.078
Profit before tax __
48.439
__
34.563
Income tax -7.603 -5.008
Profit for the year __
40.836
__
29.555
Other comprehensive income __
-10
__
126
Total comprehensive income for the year _
40.826
_
_
29.681
_

Earnings per share

Ericsson Nikola Tesla d.d.

Consolidated statement of financial position

as at 31 March 2021
2021 2020
ASSETS HRK '000 HRK '000
Non-current assets
Property, plant and equipment 145.472 153.802
Right of use asset 66.533 53.955
Intangible assets 4.499 4.522
Loans and receivables 40.500 37.867
Deferred tax assets 9.548
__
9.541
__
Total non-current assets 266.551
__
259.688
__
Current assets
Inventories 110.956 86.616
Trade receivables 198.440 193.332
Contract assets 0 0
Receivables from related parties
Other receivables
95.168
7.491
89.002
6.226
Income tax receivable 4.307 11.979
Financial assets at fair value through profit or loss 33.165 32.966
Prepayments and accrued income 27.552 33.411
Cash and cash equivalents 294.834 281.056
Total current assets __
771.913
__
734.588
TOTAL ASSETS __
1.038.464
__
994.275
EQUITY AND LIABILITIES __ __
Equity
Share capital 133.165 133.165
Treasury shares -506 -506
Legal reserves 6.658 6.658
Reserve for treasury shares
Translation reserve
13.903
-291
13.903
-281
Retained earnings 234.353 192.935
Total equity __
387.283
__
345.874
__ __
Non-current liabilities
Borrowings 26.895 30.387
Lease liability
Employee benefits
44.207
10.531
37.384
10.388
Other non-curent liabilities 864 1.095
Total non-current liabilities __
82.497
__
79.254
Current liabilities __ __
Payables to related parties 29.843 10.937
Borrowings 14.148 14.315
Lease liability 23.011 17.576
Trade and other payables 195.233 230.553
Contract liabilities
Income tax payable
202.661
3.884
192.322
2.463
Provisions 9.417 13.713
Accrued charges and deferred revenue 90.488 87.267
Total current liabilities __
568.685
__
569.147
Total liabilities __
651.181
__
648.401
TOTAL EQUITY AND LIABILITIES _
1.038.464
_
_
994.275
_

Ericsson Nikola Tesla d.d. Consolidated statement of cash flows for the period ended 31 March 2021

2021 2020
HRK '000 HRK '000
Cash flows from operating activities
Profit before tax 48.439 34.563
_ _
Adjustments for:
Depreciation and amortisation 14.358 13.775
Impairment losses and reversals -114 -111
Gain on sale of property, plant and equipment -49 -108
Net loss/(gain) on remeasurement of financial assets -188 804
Interest income -370 -726
Interest expense 335 326
Foreign exchange losses/(gains) -2.635 -1.838
Equity-settled transactions 583 839
_
60.358
_
47.524
Changes in working capital
In receivables -8.704 -78.258
In inventories -24.340 -4.653
In provisions -4.154 -854
In payables 211 54.696
_ _
Cash generated from operations 23.371 18.455
Interest paid _
-627
_
-247
Income taxes paid -193 -154
Net cash from operating activities _
22.551
_
18.054
_ _
Cash flows from investing activities
Interest received 362 302
Proceeds from sale of property, plant and equipment 15 121
Purchases of property, plant and equipment, and intangible assets -2.166 -11.433
Purchases of financial assets at fair value through profit and loss 3 0
Receipt of government grant 1.241 4.299
_ _
Net cash used in investing activities -546
_
-6.712
_
Cash flows from financing activities
Proceeds from borrowings 0 13.101
Repayment of borrowings -3.522 -487
Dividends paid -3 0
Payment of lease liability -5.730 -5.864
Net cash used in financing activities _
-9.256
_
6.749
_ _
Effects of exchange rate changes on cash and cash equivalents 1.029 968
Net decrease/(increase) in cash and cash equivalents _
13.779
_
19.059
Cash and cash equivalents at the beginning of the year 281.056 97.906
Cash and cash equivalents at the end of the year _
294.834
_
116.965
_ _
Annex 1
ISSUER'S GENERAL DATA
Reporting period: 1.1.2021 to 31.3.2021
Year: 2021
Quarter: 1.
Quarterly financial statements
egistration number (MB): 03272699 Issuer's home Member
State code:
HR
Entity's registration
number (MBS):
0800002028
Personal identification
number (OIB):
84214771175 LEI: 5299001W91BFWSUOVD63
Institution
code:
233
Name of the issuer: ERICSSON NIKOLA TESLA D.D. ZAGREB
Postcode and town: 10000 Zagreb
treet and house number: Krapinska 45
E-mail address: [email protected]
Web address: www.ericsson.hr
Number of employees
(end of the reporting
3289
Consolidated report: KD (KN-not consolidated/KD-consolidated) KN KD
Audited: RN (RN-not audited/RD-audited) RN RD
Names of subsidiaries (according to IFRS): Registered office: MB:
Libratel d.o.o. Zagreb, Selska 93 1449613
ETK BH d.o.o Mostar, Kralja Petra Krešimira 4 65-01-0996-11
son Nikola Tesla d.d. - Branch office of Kosovo Republika Kosova, Kalabria, Obj 1., Bll 1, Kati 1 Nr.13 70633647
Ericsson Nikola Tesla Servisi d.o.o. Zagreb, Krapinska 45 80921748
Ericsson Nikola Tesla BY d.o.o. Bjelorusija, Minsk, Ulica Zibickaja 2 192753195
Yes
No
Bookkeeping firm: No (Yes/No) (name of the bookkeeping firm)
Contact person: Tatjana Ricijaš
(only name and surname of the contact person)
Telephone: +385(0)13653343
E-mail address: [email protected]
Audit firm: KPMG Croatia d.o.o.
(name of the audit firm)
Certified auditor: Domagoj Hrkać
(name and surname)

BALANCE SHEET balance as at 31.03.2021

Submitter: ERICSSON NIKOLA TESLA D.D. Last day of the in HRK
At the reporting date
Item ADP
code
preceding business
year
of the current period
1 2 3 4
A) RECEIVABLES FOR SUBSCRIBED CAPITAL UNPAID 001 0 0
B) FIXED ASSETS (ADP 003+010+020+031+036) 002 259.687.508 266.551.186
I INTANGIBLE ASSETS (ADP 004 to 009)
1 Research and development
2 Concessions, patents, licences, trademarks, software and other
003
004
4.522.336
0
4.498.673
0
rights 005 349.090 325.427
3 Goodwill 006 4.173.246 4.173.246
4 Advances for the purchase of intangible assets 007 0 0
5 Intangible assets in preparation 008 0 0
6 Other intangible assets 009 0 0
II TANGIBLE ASSETS (ADP 011 to 019) 010 207.756.432 212.004.269
1 Land 011 15.605.344 15.605.344
2 Buildings 012 77.990.000 95.717.225
3 Plant and equipment 013 60.927.031 55.863.353
4 Tools, working inventory and transportation assets 014 21.111.662 31.007.921
5 Biological assets
6 Advances for the purchase of tangible assets
7 Tangible assets in preparation
015
016
0
0
0
0
8 Other tangible assets
9 Investment property
017
018
019
32.069.751
52.644
0
13.759.729
50.698
0
III FIXED FINANCIAL ASSETS (ADP 021 to 030) 020 23.742.294 24.311.887
1 Investments in holdings (shares) of undertakings within the group 021 0 0
2 Investments in other securities of undertakings within the group 022 0 0
3 Loans, deposits, etc. to undertakings within the group 023 0 0
4. Investments in holdings (shares) of companies linked by virtue of
participating interests
024 0 0
5 Investment in other securities of companies linked by virtue of
participating interests
6 Loans, deposits etc. to companies linked by virtue of participating
025 0 0
interests 026 0 0
7 Investments in securities 027 0 0
8 Loans, deposits, etc. given 028 23.742.294 24.311.887
9 Other investments accounted for using the equity method 029 0 0
10 Other fixed financial assets 030 0 0
IV RECEIVABLES (ADP 032 to 035) 031 14.124.953 16.187.860
1 Receivables from undertakings within the group
2 Receivables from companies linked by virtue of participating
032 0 0
interests 033 0 0
3 Customer receivables 034 13.688.818 15.812.291
4 Other receivables 035 436.135 375.569
V DEFERRED TAX ASSETS 036 9.541.493 9.548.497
C) CURRENT ASSETS (ADP 038+046+053+063) 037 701.176.686 744.361.517
I INVENTORIES (ADP 039 to 045) 038 86.616.332 110.956.252
1 Raw materials and consumables 039 22.285.408 22.477.707
2 Work in progress 040 64.329.125 88.476.745
3 Finished goods 041 0 0
4 Merchandise 042 0 0
5 Advances for inventories 043 1.800 1.800
6 Fixed assets held for sale 044 0 0
7 Biological assets
II RECEIVABLES (ADP 047 to 052)
1 Receivables from undertakings within the group
045
046
0
296.498.370
0
301.365.623
2 Receivables from companies linked by virtue of participating 047 0 0
interests 048 89.001.784 95.167.583
3 Customer receivables 049 193.332.095 198.439.758
4 Receivables from employees and members of the undertaking 050 0 0
5 Receivables from government and other institutions 051 12.714.304 5.126.538
6 Other receivables 052 1.450.188 2.631.744
III CURRENT FINANCIAL ASSETS (ADP 054 to 062) 053 37.006.148 37.205.254
1 Investments in holdings (shares) of undertakings within the group 054 0 0
2 Investments in other securities of undertakings within the group 055 0 0
3 Loans, deposits, etc. to undertakings within the group
4 Investments in holdings (shares) of companies linked by virtue of
056 0 0
participating interests 057 0 0
5 Investment in other securities of companies linked by virtue of 058 0 0
participating interests
6 Loans, deposits etc. to companies linked by virtue of participating
interests
059 0 0
7 Investments in securities 060 32.936.148 33.123.911
8 Loans, deposits, etc. given 061 4.070.000 4.081.343
9 Other financial assets 062 0 0
IV CASH AT BANK AND IN HAND 063 281.055.836 294.834.389
D ) PREPAID EXPENSES AND ACCRUED INCOME 064 33.410.824 27.551.562
E) TOTAL ASSETS (ADP 001+002+037+064) 065 994.275.019 1.038.464.265
OFF-BALANCE SHEET ITEMS
LIABILITIES
066 0 0
A) CAPITAL AND RESERVES (ADP 068 to 067 345.873.801 387.283.221
I INITIAL (SUBSCRIBED) CAPITAL 068 133.165.000 133.165.000
II CAPITAL RESERVES 069 0 0
III RESERVES FROM PROFIT (ADP 071+072-073+074+075) 070 20.055.496 20.055.496
1 Legal reserves 071 6.658.250 6.658.250
2 Reserves for treasury shares 072 13.903.446 13.903.446
3 Treasury shares and holdings (deductible item) 073 -506.200 -506.200
4 Statutory reserves 074 0 0
5 Other reserves 075 0 0
IV REVALUATION RESERVES 076 0 0
V FAIR VALUE RESERVES AND OTHER (ADP 078 to 082) 077 0 0
1 Financial assets at fair value through other comprehensive income
(i.e. available for sale)
078 0 0
2 Cash flow hedge - effective portion 079 0 0
3 Hedge of a net investment in a foreign operation - effective portion 080 0 0
4 Other fair value reserves 081 0 0
5 Exchange differences arising from the translation of foreign 082 0 0
operations (consolidation)
VI RETAINED PROFIT OR LOSS BROUGHT FORWARD (ADP 084-
083 98.113.316 193.226.723
085)
1 Retained profit
084 98.113.316 193.226.723
2 Loss brought forward
VII PROFIT OR LOSS FOR THE BUSINESS YEAR (ADP 087-088)
1 Profit for the business year
085
086
087
0
94.539.989
0
40.836.002
2 Loss for the business year
VIII MINORITY (NON-CONTROLLING) INTEREST
088
089
94.539.989
0
0
40.836.002
0
0
B) PROVISIONS (ADP 091 to 096) 090 24.101.013 19.947.388
1 Provisions for pensions, termination benefits and similar
obligations
091 15.417.275 11.305.827
2 Provisions for tax liabilities 092 0 0
3 Provisions for ongoing legal cases 093 719.915 719.915
4 Provisions for renewal of natural resources 094 0 0
5 Provisions for warranty obligations 095 2.309.588 2.520.697
6 Other provisions 096 5.654.234 5.400.948
C) LONG-TERM LIABILITIES (ADP 098 to 108) 097 68.866.524 71.965.918
1 Liabilities to undertakings within the group 098 0 0
2 Liabilities for loans, deposits, etc. of undertakings within the group 099 0 0
3 Liabilities to companies linked by virtue of participating interests
4 Liabilities for loans, deposits etc. of companies linked by virtue of
100 0 0
participating interests 101 0 0
5 Liabilities for loans, deposits etc. 102 0 0
6 Liabilities to banks and other financial institutions 103 67.771.047 71.101.738
7 Liabilities for advance payments 104 0 0
8 Liabilities to suppliers 105 0 0
9 Liabilities for securities 106 0 0
10 Other long-term liabilities 107 1.095.477 864.180
11 Deferred tax liability 108 0 0
D) SHORT-TERM LIABILITIES (ADP 110 to 123) 109 286.357.067 300.078.973
1 Liabilities to undertakings within the group 110 0 0
2 Liabilities for loans, deposits, etc. of undertakings within the group 111 0 0
3 Liabilities to companies linked by virtue of participating interests 112 10.936.701 29.842.659
4 Liabilities for loans, deposits etc. of companies linked by virtue of
participating interests
113 0 0
5 Liabilities for loans, deposits etc. 114 0 0
6 Liabilities to banks and other financial institutions 115 31.891.618 37.159.184
7 Liabilities for advance payments 116 10.512.321 33.959.839
8 Liabilities to suppliers 117 103.431.782 98.838.059
9 Liabilities for securities
10 Liabilities to employees
11 Taxes, contributions and similar liabilities
118
119
0
99.116.679
0
63.077.657
12 Liabilities arising from the share in the result
13 Liabilities arising from fixed assets held for sale
120
121
122
30.467.967
0
0
37.201.576
0
0
14 Other short-term liabilities
E) ACCRUALS AND DEFERRED INCOME
123 0 0
F) TOTAL – LIABILITIES (ADP 067+090+097+109+124)
G) OFF-BALANCE SHEET ITEMS
124
125
126
269.076.614
994.275.019
0
259.188.766
1.038.464.265
0

for the period 01.01.2021 to 31.03.2021 STATEMENT OF PROFIT OR LOSS

in HRK

Submitter: ERICSSON NIKOLA TESLA D.D. Same period of the previous year Current period
Item ADP
code
Cumulative Quarter Cumulative Quarter
1
I OPERATING INCOME (ADP 002 to 006)
2
001
3
492.716.431
4
492.716.431
5
449.931.953
6
449.931.953
1 Income from sales with undertakings within the group
2 Income from sales (outside group)
002
003
0
487.662.540
0
487.662.540
0
445.858.417
0
445.858.417
3 Income from the use of own products, goods and services
4 Other operating income with undertakings within the group
004
005
0
0
0
0
0
0
0
0
5 Other operating income (outside the group) 006 5.053.891 5.053.891 4.073.536 4.073.536
II OPERATING EXPENSES (ADP 08+009+013+017+018+019+022+029)
1 Changes in inventories of work in progress and finished goods
007
008
459.230.808
15.434.219
459.230.808
15.434.219
404.665.336
-24.147.427
404.665.336
-24.147.427
2 Material costs (ADP 010 to 012)
a) Costs of raw materials and consumables
009
010
206.240.323
113.017.616
206.240.323
113.017.616
189.535.521
66.276.155
189.535.521
66.276.155
b) Costs of goods sold
c) Other external costs
011
012
0
93.222.707
0
93.222.707
0
123.259.366
0
123.259.366
3 Staff costs (ADP 014 to 016)
a) Net salaries and wages
013
014
205.831.603
127.024.047
205.831.603
127.024.047
213.022.732
132.822.170
213.022.732
132.822.170
b) Tax and contributions from salary costs
c) Contributions on salaries
015
016
58.153.585
20.653.971
58.153.585
20.653.971
56.818.850
23.381.712
56.818.850
23.381.712
4 Depreciation
5 Other costs
017 13.774.870 13.774.870 14.357.753 14.357.753
6 Value adjustments (ADP 020+021) 018
019
15.503.959
248.098
15.503.959
248.098
10.510.738
661.021
10.510.738
661.021
a) fixed assets other than financial assets
b) current assets other than financial assets
020
021
0
248.098
0
248.098
0
661.021
0
661.021
7 Provisions (ADP 023 to 028)
a) Provisions for pensions, termination benefits and similar obligations
022
023
2.126.812
2.096.939
2.126.812
2.096.939
609.260
153.033
609.260
153.033
b) Provisions for tax liabilities
c) Provisions for ongoing legal cases
024
025
0
0
0
0
0
0
0
0
d) Provisions for renewal of natural resources
e) Provisions for warranty obligations
026
027
0
29.873
0
29.873
0
456.227
0
456.227
f) Other provisions
8 Other operating expenses
028
029
0
70.924
0
70.924
0
115.738
0
115.738
III FINANCIAL INCOME (ADP 031 to 040)
1 Income from investments in holdings (shares) of undertakings within
030
031
2.205.928
0
2.205.928
0
3.509.916
0
3.509.916
0
the group
2 Income from investments in holdings (shares) of companies linked by
0 0 0 0
virtue of participating interests
3 Income from other long-term financial investment and loans granted to
032
undertakings within the group
4 Other interest income from operations with undertakings within the
033 0 0 0 0
group
5 Exchange rate differences and other financial income from operations
034 0 0 0 0
with undertakings within the group
6 Income from other long-term financial investments and loans
035
036
117.645
0
117.645
0
29.803
0
29.803
0
7 Other interest income 037 599.969 599.969 370.404 370.404
8 Exchange rate differences and other financial income
9 Unrealised gains (income) from financial assets
038
039
1.488.314
0
1.488.314
0
2.921.947
0
2.921.947
0
10 Other financial income
IV FINANCIAL EXPENSES (ADP 042 to 048)
040
041
0
1.128.270
0
1.128.270
187.763
337.959
187.763
337.959
1 Interest expenses and similar expenses with undertakings within the
group
042 5.520 5.520 29.658 29.658
2 Exchange rate differences and other expenses from operations with
undertakings within the group
043 0 0 0 0
3 Interest expenses and similar expenses
4 Exchange rate differences and other expenses
044
045
318.970
0
318.970
0
308.301
0
308.301
0
5 Unrealised losses (expenses) from financial assets
6 Value adjustments of financial assets (net)
046
047
0
0
0
0
0
0
0
0
7 Other financial expenses
V SHARE IN PROFIT FROM UNDERTAKINGS LINKED BY VRITUE OF
048 803.780 803.780 0 0
PARTICIPATING INTERESTS
VI SHARE IN PROFIT FROM JOINT VENTURES
049
050
0
0
0
0
0
0
0
0
VII SHARE IN LOSS OF COMPANIES LINKED BY VIRTUE OF
PARTICIPATING INTEREST
051 0 0 0 0
VIII SHARE IN LOSS OF JOINT VENTURES
IX TOTAL INCOME (ADP 001+030+049 +050)
052
053
0
494.922.358
0
494.922.358
0
453.441.869
0
453.441.869
X TOTAL EXPENDITURE (ADP 007+041+051 + 052)
XI PRE-TAX PROFIT OR LOSS (ADP 053-054)
054
055
460.359.078
34.563.280
460.359.078
34.563.280
405.003.295
48.438.574
405.003.295
48.438.574
1 Pre-tax profit (ADP 053-054)
2 Pre-tax loss (ADP 054-053)
056
057
34.563.280
0
34.563.280
0
48.438.574
0
48.438.574
0
XII INCOME TAX
XIII PROFIT OR LOSS FOR THE PERIOD (ADP 055-059)
058
059
5.008.348
29.554.932
5.008.348
29.554.932
7.602.573
40.836.002
7.602.573
40.836.002
1 Profit for the period (ADP 055-059)
2 Loss for the period (ADP 059-055)
060
061
29.554.932
0
29.554.932
0
40.836.002
0
40.836.002
0
DISCONTINUED OPERATIONS (to be filled in by undertakings subject to IFRS only with discontinued operations)
XIV PRE-TAX PROFIT OR LOSS OF DISCONTINUED OPERATIONS
(ADP 063-064)
1 Pre-tax profit from discontinued operations
062
063
0
0
0
0
0
0
0
0
2 Pre-tax loss on discontinued operations
XV INCOME TAX OF DISCONTINUED OPERATIONS
064
065
0
0
0
0
0
0
0
0
1 Discontinued operations profit for the period (ADP 062-065)
2 Discontinued operations loss for the period (ADP 065-062)
066
067
TOTAL OPERATIONS (to be filled in only by undertakings subject to IFRS with discontinued operations)
XVI PRE-TAX PROFIT OR LOSS (ADP 055-+062)
068
1 Pre-tax profit (ADP 068)
2 Pre-tax loss (ADP 068)
069 0 0 0 0
XVII INCOME TAX (ADP 058+065) 070
071
0 0 0 0
XVIII PROFIT OR LOSS FOR THE PERIOD (ADP 068-071)
1 Profit for the period (ADP 068-071)
072
073
2 Loss for the period (ADP 071-068)
APPENDIX to the P&L (to be filled in by undertakings that draw up consolidated annual financial statements)
074
XIX PROFIT OR LOSS FOR THE PERIOD (ADP 076+077)
1 Attributable to owners of the parent
075
076
0
0
0
0
0
0
0
0
2 Attributable to minority (non-controlling) interest
STATEMENT OF OTHER COMPRHENSIVE INCOME (to be filled in by undertakings subject to IFRS)
077 0 0 0 0
I PROFIT OR LOSS FOR THE PERIOD
II OTHER COMPREHENSIVE INCOME/LOSS BEFORE TAX
078 29.554.932
0
29.554.932
0
40.836.002
0
40.836.002
0
(ADP 80+ 87) 079
III Items that will not be reclassified to profit or loss (ADP 081 to 085)
1 Changes in revaluation reserves of fixed tangible and intangible
080 0 0 0 0
assets
2 Gains or losses from subsequent measurement of equity instruments
081 0 0 0 0
at fair value through other comprehensive income
3 Fair value changes of financial liabilities at fair value through
082
083
0
0
0
0
0
0
0
0
statement of profit or loss, attributable to changes in their credit risk
4 Actuarial gains/losses on the defined benefit obligation
084 0 0 0 0
5 Other items that will not be reclassified 085 0 0 0 0
6 Income tax relating to items that will not be reclassified 086 0 0 0 0
IV Items that may be reclassified to profit or loss (ADP 088 to 095) 087 126.056 126.056 -9.517 -9.517
1 Exchange rate differences from translation of foreign operations
2 Gains or losses from subsequent measurement of debt securities at
088 126.056 126.056 -9.517 -9.517
fair value through other comprehensive income
3 Profit or loss arising from effective cash flow hedging
089
090
0
0
0
0
0
0
0
0
4 Profit or loss arising from effective hedge of a net investment in a
foreign operation
091 0 0 0 0
5 Share in other comprehensive income/loss of companies linked by 092 0 0 0 0
virtue of participating interests
6 Changes in fair value of the time value of option
093 0 0 0 0
7 Changes in fair value of forward elements of forward contracts
8 Other items that may be reclassified to profit or loss
094 0 0 0 0
9 Income tax relating to items that may be reclassified to profit or loss 095
096
0
0
0
0
0
0
0
0
V NET OTHER COMPREHENSIVE INCOME OR LOSS (ADP 080+087-
086 - 096)
VI COMPREHENSIVE INCOME OR LOSS FOR THE PERIOD (ADP
097 126.056 126.056 -9.517 -9.517
078+097)
APPENDIX to the Statement on comprehensive income (to be filled in by undertakings that draw up consolidated statements)
098 29.680.988 29.680.988 40.826.485 40.826.485
VI COMPREHENSIVE INCOME OR LOSS FOR THE PERIOD (ADP
100+101)
099 29.680.988 29.680.988 40.826.485 40.826.485
1 Attributable to owners of the parent
2 Attributable to minority (non-controlling) interest
100
101
29.680.988
0
29.680.988
0
40.826.485
0
40.826.485
0

STATEMENT OF CASH FLOWS - indirect method for the period 01.01.2021 to 31.03.2021

in HRK
Submitter: ERICSSON NIKOLA TESLA D.D.
Item
ADP
code
Same period of the
previous year
Current period
1 2 3 4
Cash flow from operating activities
1 Pre-tax profit 001 34.563.280 48.438.574
2 Adjustments (ADP 003 to 010):
a) Depreciation
002 12.960.587
13.774.870
11.919.488
14.357.753
b) Gains and losses from sale and value adjustment of fixed tangible and
intangible assets
003
004
-108.410 -49.492
c) Gains and losses from sale and unrealised gains and losses and value
adjustment of financial assets
005 803.780 -187.763
d) Interest and dividend income 006 -725.660 -370.404
e) Interest expenses 007 325.552 335.363
f) Provisions 008 0 0
g) Exchange rate differences (unrealised) 009 -1.837.502 -2.635.167
h) Other adjustments for non-cash transactions and unrealised gains and
losses
010 727.957 469.197
I Cash flow increase or decrease before changes in working capital
(ADP 001+002)
011 47.523.868 60.358.062
3 Changes in the working capital (ADP 013 to 016) 012 -29.069.027 -36.987.001
a) Increase or decrease in short-term liabilities 013 54.696.375 210.874
b) Increase or decrease in short-term receivables 014 -78.258.047 -8.704.331
c) Increase or decrease in inventories 015 -4.653.013 -24.339.920
d) Other increase or decrease in working capital 016 -854.342 -4.153.625
II Cash from operations (ADP 011+012) 017 18.454.840 23.371.060
4 Interest paid
5 Income tax paid
018 -247.350 -627.419
A) NET CASH FLOW FROM OPERATING ACTIVITIES (ADP 017 to 019) 019
020
-153.604
18.053.887
-192.504
22.551.138
Cash flow from investment activities
1 Cash receipts from sales of fixed tangible and intangible assets 021 120.608 15.362
2 Cash receipts from sales of financial instruments 022 2.663
3 Interest received 023 301.703 361.830
4 Dividends received 024
5 Cash receipts from repayment of loans and deposits 025
6 Other cash receipts from investment activities 026 4.298.850 1.240.572
III Total cash receipts from investment activities (ADP 021 to 026) 027 4.721.161 1.620.428
1 Cash payments for the purchase of fixed tangible and intangible assets 028 -11.432.961 -2.166.310
2 Cash payments for the acquisition of financial instruments 029 0
3 Cash payments for loans and deposits for the period 030
4 Acquisition of a subsidiary, net of cash acquired
5 Other cash payments from investment activities
031
IV Total cash payments from investment activities (ADP 028 to 032) 032
033
0
-11.432.961
-2.166.310
B) NET CASH FLOW FROM INVESTMENT ACTIVITIES (ADP 027 +033) 034 -6.711.800 -545.882
Cash flow from financing activities
1 Cash receipts from the increase in initial (subscribed) capital 035 0
2 Cash receipts from the issue of equity financial instruments and debt
financial instruments
036
3 Cash receipts from credit principals, loans and other borrowings 037 13.100.997
4 Other cash receipts from financing activities 038 0
V Total cash receipts from financing activities (ADP 035 to 038) 039 13.100.997 0
1 Cash payments for the repayment of credit principals, loans and other
borrowings and debt financial instruments
040 -487.202 -3.522.066
2 Cash payments for dividends 041 -390 -3.485
3 Cash payments for finance lease 042
4 Cash payments for the redemption of treasury shares and decrease in
initial (subscribed) capital
043
5 Other cash payments from financing activities 044 -5.863.949 -5.729.997
VI Total cash payments from financing activities (ADP 040 to 044) 045 -6.351.541 -9.255.548
C) NET CASH FLOW FROM FINANCING ACTIVITIES (ADP 039 +045) 046 6.749.455 -9.255.548
1 Unrealised exchange rate differences in respect of cash and cash
equivalents
047 967.556 1.028.845
D) NET INCREASE OR DECREASE IN CASH FLOWS (ADP
020+034+046+047)
048 19.059.098 13.778.553
E) CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE
PERIOD
049 97.906.291 281.055.836
F) CASH AND CASH EQUIVALENTS AT THE END OF THE
PERIOD(ADP 048+049)
050 116.965.389 294.834.389
STATEMENT OF CHANGES IN EQUITY
for the period from
1.1.2021
to
31.3.2021 in HRK
Attributable to owners of the parent
ADP Fair value of
financial assets
Hedge of a net Exchange rate Minority (non Total capital and
Item code Initial (subscribed)
capital
Capital reserves Legal reserves Reserves for
treasury shares
Treasury shares
and holdings
Statutory reserves Other reserves Revaluation
reserves
through other
comprehensive
Cash flow hedge -
effective portion
investment in a
foreign operation -
Other fair value
reserves
differences from
translation of
Retained profit /
loss brought
Profit/loss for the
business year
Total attributable to
owners of the
controlling)
interest
reserves
(deductible item) income (available effective portion foreign operations forward parent
1 2 3 4 5 6 7 8 9 10 for sale)
11
12 13 14 15 16 17 18 (3 to 6 - 7 19 20 (18+19)
Previous period + 8 to 17)
1 Balance on the first day of the previous business year
2 Changes in accounting policies
01
02
133.165.000 6.658.250 14.872.546 240.540 0 160.297.640
0
0
0
314.752.896
0
0
0
314.752.896
0
3 Correction of errors 03 0 0 0 0 0
4 Balance on the first day of the previous business year (restated) (ADP 01 to
03)
04 133.165.000 0 6.658.250 14.872.546 240.540 0 0 0 0 0
0
0 0 160.297.640 0 314.752.896 0 314.752.896
5 Profit/loss of the period
6 Exchange rate differences from translation of foreign operations
05 0 0 0 0 0 0 0 0 0 0
0
0 94.539.989 94.539.989 0 94.539.989
7 Changes in revaluation reserves of fixed tangible and intangible assets 06 0 0 0 0 0 0 -221.682 0 0 0
0
0 0 -221.682 0 -221.682
07 0 0 0 0 0 0 0 0 0 0
0
0 0 0 0 0
8 Gains or losses from subsequent measurement of financial assets at fair value
through other comprehensive income (available for sale)
08 0 0 0 0 0 0 0 0 0 0
0
0 0 0 0 0
9 Profit or loss arising from effective cash flow hedge 09 0 0 0 0 0 0 0 0 0 0
0
0 0 0 0 0
10 Profit or loss arising from effective hedge of a net investment in a foreign
operation
10 0 0 0 0 0 0 0 0 0 0
0
0 0 0 0 0 0 0
11 Share in other comprehensive income/loss of companies linked by virtue of 11 0 0 0 0 0 0 0 0 0 0
0
0 0 0 0 0 0 0
participating interests
12 Actuarial gains/losses on the defined benefit obligation
12 0 0 0 0 0 0 0 0 0 0 0
13 Other changes in equity unrelated to owners 13 0 0 0 0 0 0 0 0 0 0
0
0 0 0 0 0 0 0
14 Tax on transactions recognised directly in equity
15 Decrease in initial (subscribed) capital (other than arising from the pre
14 0 0 0 0 0 0 0 0 0 0
0
0 0 0 0 0 0 0
bankruptcy settlement procedure or from the reinvestment of profit) 15 0 0 0 0 0 0 0 0 0 0
0
0 0 0 0 0 0 0
16 Decrease in initial (subscribed) capital arising from the pre-bankruptcy
settlement procedure
16 0 0 0 0 0 0 0 0 0 0
0
0 0 0 0 0 0 0
17 Decrease in initial (subscribed) capital arising from the reinvestment of profit 17 0 0 0 0 0 0 0 0 0 0
0
0 0 0 0 0 0 0
18 Redemption of treasury shares/holdings
19 Payments from members/shareholders
18
19
0 0 0 0 1.234.760
0
0 0 0 0 0
0
0 0 0
0
0
0
-1.234.760
0
0
0
-1.234.760
0
20 Payment of share in profit/dividend
21 Other distributions and payments to members/shareholders
20 0 -65.230.956 0 -65.230.956 0 -65.230.956
22 Transfer to reserves according to the annual schedule 21
22
0 0 0 -969.100
0
-969.100
0
0 0 0 0 0
0
0
0
0 3.268.314
0
0
0
3.268.314
0
0
0
3.268.314
0
23 Increase in reserves arising from the pre-bankruptcy settlement procedure
24 Balance on the last day of the previous business year reporting period (ADP
23 0 0 0 0 0 0 0 0 0 0
0
0 0 0 0 0 0 0
04 to 23)
APPENDIX TO THE STATEMENT OF CHANGES IN EQUITY (to be filled in by undertakings that draw up financial statements in accordance with the IFRS)
24 133.165.000 0 6.658.250 13.903.446 506.200 0 -221.682 0 0 0
0
0 0 98.334.998 94.539.989 345.873.801 0 345.873.801
I OTHER COMPREHENSIVE INCOME OF THE PREVIOUS PERIOD, NET OF
TAX (ADP 06 to 14) 25 0 0 0 0 0 0 -221.682 0 0 0
0
0 0 0 0 -221.682 0 -221.682
II COMPREHENSIVE INCOME OR LOSS FOR THE PREVIOUS PERIOD (ADP 26 0 0 0 0 0 0 -221.682 0 0 0
0
0 0 0 94.539.989 94.318.307 0 94.318.307
05+25)
III TRANSACTIONS WITH OWNERS IN THE PREVIOUS PERIOD RECOGNISED
DIRECTLY IN EQUITY (ADP 15 to 23)
27 0 0 0 -969.100 265.660 0 0 0 0 0
0
0 0 -61.962.642 0 -63.197.402 0 -63.197.402
Current period
1 Balance on the first day of the current business year
2 Changes in accounting policies
28
29
133.165.000 6.658.250 13.903.446 506.200 -221.682 192.874.987 345.873.801
0
345.873.801
0
3 Correction of errors 30 0 0
4 Balance on the first day of the current business year (restated) (AOP 28 to 30) 31 133.165.000 0 6.658.250 13.903.446 506.200 0 -221.682 0 0 0
0
0 0 192.874.987 0 345.873.801 0 345.873.801
5 Profit/loss of the period
6 Exchange rate differences from translation of foreign operations
32
33
0
0
0
0
0
0
0
0
0
0
0
0
0
-9.517
0
0
0
0
0
0
0
0
0
0
40.836.002
0
40.836.002
-9.517
40.836.002
-9.517
7 Changes in revaluation reserves of fixed tangible and intangible assets 34 0 0 0 0 0 0 0 0 0
0
0 0
8 Gains or losses from subsequent measurement of financial assets at fair value
through other comprehensive income (available for sale)
9 Profit or loss arising from effective cash flow hedge
35 0 0 0 0 0 0 0 0 0
0
0 0
10 Profit or loss arising from effective hedge of a net investment in a foreign 36 0 0 0 0 0 0 0 0 0 0 0 0
operation 37 0 0 0 0 0 0 0 0 0 0 0 0
11 Share in other comprehensive income/loss of companies linked by virtue of
participating interests
38 0 0 0 0 0 0 0 0
12 Actuarial gains/losses on the defined benefit obligation
13 Other changes in equity unrelated to owners
39 0 0 0 0 0 0 0 0
14 Tax on transactions recognised directly in equity 40
41
0 0 0 0 0 0 0
0
0
0
15 Decrease in initial (subscribed) capital (other than arising from the pre
bankruptcy settlement procedure or from the reinvestment of profit)
42 0 0
16 Decrease in initial (subscribed) capital arising from the pre-bankruptcy
settlement procedure
43 0 0
17 Decrease in initial (subscribed) capital arising from the reinvestment of profit 44 0 0
18 Redemption of treasury shares/holdings 45 0 0
19 Payments from members/shareholders 46 0 0
20 Payment of share in profit/dividend
21 Other distributions and payments to members/shareholders
47
48
582.936 0
582.936
0
582.936
22 Carryforward per annual plane 49 0 0
23 Increase in reserves arising from the pre-bankruptcy settlement procedure
24 Balance on the last day of the current business year reporting period (ADP
50 0 0
31 to 50) 51 133.165.000 0 6.658.250 13.903.446 506.200 0 -231.199 0 0 0
0
0 0 193.457.923 40.836.002 387.283.221 0 387.283.221
APPENDIX TO THE STATEMENT OF CHANGES IN EQUITY (to be filled in by undertakings that draw up financial statements in accordance with the IFRS)
I OTHER COMPREHENSIVE INCOME FOR THE CURRENT PERIOD, NET OF
TAX (ADP 33 to 41) 52 0 0 0 0 0 0 -9.517 0 0 0
0
0 0 0 0 -9.517 0 -9.517
II COMPREHENSIVE INCOME OR LOSS FOR THE CURRENT PERIOD (ADP 32
do 52)
53 0 0 0 0 0 0 -9.517 0 0 0
0
0 0 0 40.836.002 40.826.485 0 40.826.485
III TRANSACTIONS WITH OWNERS IN THE CURRENT PERIOD RECOGNISED
DIRECTLY IN EQUITY (ADP 42 to 50)
54 0 0 0 0 0 0 0 0 0 0
0
0 0 582.936 0 582.936 0 582.936

NOTES TO FINANCIAL STATEMENTS - TFI

(drawn up for quarterly reporting periods) Name of the issuer: ERICSSON NIKOLA TESLA D.D.

Personal identification number (OIB): 84214771175 Reporting period: Q1 2021

Notes to financial statements for quarterly periods include:

a) explanation of business events relevant to understanding changes in the statement of financial position and financial performance for the reporting semi-annual period of the issuer with respect to the last business year: information is provided regarding these events and relevant information published in the last annual financial statement is updated (items 15 to 15C

IAS 34 - Interim financial reporting) b) information on the access to the latest annual financial statements, for the purpose of understanding information published in the notes to financial statements drawn up for the semi-annual reporting period

c) a statement explaining that the same accounting policies are applied while drawing up financial statements for the semiannual reporting period as in the latest annual financial statements or, in the case where the accounting policies have changed, a description of the nature and effect of the changes (item 16.A (a) IAS 34 - Interim financial reporting)

d) a description of the financial performance in the case of the issuer whose business is seasonal (items 37 and 38 IAS 34 -

Interim financial reporting) e) other comments prescribed by IAS 34 - Interim financial reporting f) in the notes to quarterly periods financial statements, in addition to the information stated above, information in respect of the following matters shall be disclosed: 1. undertaking's name, registered office (address), legal form, country of establishment, entity's registration number and, if applicable, the indication whether the undertaking is undergoing liquidation, bankruptcy proceedings, shortened termination proceedings or extraordinary administration

2. adopted accounting policies (only an indication of whether there has been a change from the previous period)

  1. the total amount of any financial commitments, guarantees or contingencies that are not included in the balance sheet, and an indication of the nature and form of any valuable security which has been provided; any commitments concerning pensions of the undertaking within the group or company linked by virtue of participating interest shall be disclosed separately

4. the amount and nature of individual items of income or expenditure which are of exceptional size or incidence 5. amounts owed by the undertaking and falling due after more than five years, as well as the total debts of the undertaking

covered by valuable security furnished by the undertaking, specifying the type and form of security 6. average number of employees during the financial year

7. where, in accordance with the regulations, the undertaking capitalised on the cost of salaries in part or in full, information

on the amount of the total cost of employees during the year broken down into the amount directly debiting the costs of the period and the amount capitalised on the value of the assets during the period, showing separately the total amount of net salaries and the amount of taxes, contributions from salaries and contributions on salaries 8. where a provision for deferred tax is recognised in the balance sheet, the deferred tax balances at the end of the financial year, and the movement in those balances during the financial year

9. the name and registered office of each of the undertakings in which the undertaking, either itself or through a person acting in their own name but on the undertaking's behalf, holds a participating interest, showing the proportion of the capital held, the amount of capital and reserves, and the profit or loss for the latest financial year of the undertaking concerned for which financial statements have been adopted; the information concerning capital and reserves and the profit or loss may be omitted where the undertaking concerned does not publish its balance sheet and is not controlled by another undertaking

  1. the number and the nominal value or, in the absence of a nominal value, the accounting par value of the shares

subscribed during the financial year within the limits of the authorised capital 11. the existence of any participation certificates, convertible debentures, warrants, options or similar securities or rights, with an indication of their number and the rights they confer

  1. the name, registered office and legal form of each of the undertakings of which the undertaking is a member having unlimited liability 13. the name and registered office of the undertaking which draws up the consolidated financial statements of the largest group of undertakings of which the undertaking forms part as a controlled group member 14. the name and registered office of the undertaking which draws up the consolidated financial statements of the smallest group of undertakings of which the undertaking forms part as a controlled group member and which is also included in the group of undertakings referred to in point 13

15. the place where copies of the consolidated financial statements referred to in points 13 and 14 may be obtained, provided that they are available

  1. the nature and business purpose of the undertaking's arrangements that are not included in the balance sheet and the financial impact on the undertaking of those arrangements, provided that the risks or benefits arising from such arrangements are material and in so far as the disclosure of such risks or benefits is necessary for the purposes of assessing the financial position of the undertaking

17. the nature and the financial effect of material events arising after the balance sheet date which are not reflected in the profit and loss account or balance sheet

Explanation of business events relevant to understanding changes in the statement of financial position and financial performance are published in Press info/Management letter

b) The financial statements have been prepared in accordance with International Financial Reporting Standards adopted by the European Union (IFRSs), on the historical cost basis, with the exception of financial instruments which are carried at fair value through profit or loss. Policies have been consistently applied to all the periods presented.

Last issued annual financial statements are available at ZSE and as well at www.ericsson.hr/en/reports www.ericsson.hr/en/reports

31.3.2021 31.3.2020 HRK 000 HRK 000

c) The interim financial statements for the first quarter of 2021 are prepared applying the same accounting policies as in the latest annual

d) financial statements presented in the Annual Report.

The issuer does not have sesonal bussines activities. e)

a)

Segment reporting 31.03.2021. 31.03.2020. 31.03.2021.31.03.2020. 31.03.2021.31.03.2020. 31.03.2021.31.03.2020. 31.03.2021.31.03.2020. 1.03.2021. 31.03.2020. Other Networks Digital Services Total Unallocated Managed Services

'000 kn '000 kn '000 kn '000 kn '000 kn '000 kn '000 kn '000 kn '000 kn '000 kn '000 kn '000 kn
Segment sales revenu 219.871 303.672 118.800 103.146 105.444 78.799 1.742 2.046 0 0 445.857 487.663
Operating profit 33.280 29.235 13.882 7.691 9.201 4.090 102 141 -11.198 -7.672 45.267 33.485
Transactions with related parties:
Sales 216.132 217.673
Purchases 60.635 123.299
Balances with related parties
31.3.2021 31.12.2020
HRK 000 HRK 000
Receivable 95.168 89.002
Payable 29.843 10.937
  1. Issuer's name, registered office (address), legal form, country of establishment, entity's registration number are disclosed in the sheet

  2. General data of this document.

Accounting policies have not been changed in relation to previous reporting period. 3.

Financial commitments in term of guarantees that are not included in the balance sheet are not material and Management Board believes that possibility of any outflow is remote. The Group has no commitments concerning pensions that are in scope of IAS 19.

4.

In the reporting period there were no individual items of income or expenditure of exceptional size or incidence. 5.

The Group has no debt falling due after more than five years. At the balance sheet date, the Group does not have debts covered by valuable securities/insurance.

6.

The average number of employees during the reporting period is 3262 (Q12020: 3217). The Group does not categorise employees. 7.

8. Provision for deferred tax is calculated annualy, at balance sheet date 31 December. There were no movement in deferred tax balances

No cost of salaries was capitalised in the reporting period. during reporting period.

9. The Group has no participating interest.

  1. There were no shares subscribed during the financial year within the limits of the authorised capital.

11. The Group has no participation certificates, convertible debentures, warrants, options or similar securities or rights.

  1. The Group has no shares in companies having unlimited liability.

13. and 14. The company Telefonaktiebolaget LM Ericsson (Sweden, Torshamnsgatan 21, SE-164 83 Stockholm) prepares the consolidated financial statements for the larger Group of companies, in which Ericsson Nikola Tesla Group is included as an associate member of Ericsson.

  1. Those consolidated reports are available at www.ericsson.com/en/investors/financial-reports.

16.

  1. The Company did not have any arrangements that are not included in the balance sheet, where the risks or benefits arising from such arrangements are material.

There are no material events arising after the balance sheet date which are not reflected in the profit and loss account or balance sheet.

APPENDIX (Reconciliation of the differences arrising due to structure and classification of the positions in TFI-POD in XLS format compared to classification of the positions in the audited annual report in PDF):

Balance Sheet

Within the category Current liabilities in Statement of financial position total amount of Trade and other payables and Income tax payable is indicated in TFI-POD in AOP 117 Liabilities to suppliers,119 Liabilities to employees,120 Taxes, Also, within the category Current liabilities in Statement of financial position total amount of Provisions, Accrued charges and deferred revenue and Contract liabilities is indicated in TFI-POD form under AOP 091 Provisions for pensions, termination benefits and similar obligations, 093 Provisions for ongoing legal cases,095 Provisions for warranty Within the category Non-current assets in Statement of financial position total amount of Loans and receivables is indicated in TFI-POD form under AOP 028 Loans, deposits, etc. given,034 Customer receivables,035 Other receivables. Within the category Current assets in Statement of financial position total amount of Other receivables, Income tax receivables, Financial assets at fair value through profit or loss is indicated in TFI-POD form under AOP 051 Receivables from government and other institutions,052 Other receivables,060 Investments in securities,061 Loans, deposits, etc. given. Within the category Equity in Statement of financial position total amount of Retained earnings is indicated in TFI-POD form under AOP 083 Retaind profit/loss brought forward and 086 Profit or Loss for the business year.

obligations,096 Other provisions,116 Liabilities for advance payments,124 Accruals and deferred income.

P&L

Cost structure in Statement of comprehensive income (FS form) is according to function and the presentation is different from TFI-POD forms where cost is presented by nature. Total amount of Cost of Sales, Selling, Administrative and Other operating expenses equals to amount of AOP 007 Operating expenses.

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