Granolio d.d.

Annual / Quarterly Financial Statement • Feb 28, 2020

Consolidated financial results for the twelve months period ended 31 December 2019 (unaudited)

General information on Granolio d.d.

GRANOLIO d.d. ("The Company") is a joint-stock company registered with the Commercial Court of Zagreb, Croatia. The Company's tax number (OIB) is 59064993527, and its registration number (MBS) 080111595.

The Company's headquarter is located in Zagreb at Budmanijeva 5.

Subsidiaries

The Company holds 100% of the shares in Zdenačka farma d.o.o.

It has a controlling influence in the decision-making process in Zdenka mliječni proizvodi d.o.o. which has been consolidated into the Granolio Group since 2011.

The Company also holds minority interests in the Žitozajednica d.o.o., Zagrebačke pekarne Klara d.o.o. and Prehrana trgovina d.d. companies.

Ownership in subsidiaries is presented in the organizational chart below:

Granolio d.d.
Zdenačka farma d.o.o.	Zdenka mliječni proizvodi
100%	d.o.o. 50%

The Group monitors its business operations through four business segments:

• Milling
• Dairy and cheese production
• Wholesale trade
• Other

Milling is the segment that comprises flour production and sale of flour. This business segment is comprised in the holding company exclusively.

Dairy and cheese production ("Dairy") comprises cheese production and cheese sale realized in the company Zdenka – mliječni proizvodi d.o.o., but also milk production and sale of milk by dairy farm in Zdenačka farma d.o.o.

Wholesale trade segment comprises grain and oilseed trade and trade of sowing materials performed by holding company Granolio d.d.

The segment Other comprises beef cattle farming and rendering the silo services and the storage of trade goods (Granolio d.d.)

Granolio Group's financial indicators for the twelve months period of 2019

	In thousands of HRK
	1-12 2019	1-12 2018	change
Operating income	486.134	538.571	(52.437)	(10%)
Operating expenses	(493.897)	(542.722)	48.825	9%
EBIT	(7.763)	(4.151)	(3.612)	87%
EBIT margin	-2%	(1%)
EBITDA	19.345	32.600	(13.255)	(41%)
EBITDA margin	4%	6%
Net financial result	(7.179)	89.105	(96.284)	108%
Net result for the period	(14.942)	83.940	(98.882)	118%
Attributable to the Group	(16.044)	81.861	(97.905)	120%
Non-controlling interest	1.101	2.079	(978)	47%

Group's EBITDA in 2019 amounted to HRK 19.3 million. It decreased in comparisson to the previous year as a result of lower profit margins and increase in employee costs realised in all members of Granolio group.

Net financial result represents the difference between financial revenues and financial expenses. In 2019, financial expense is greater due to holding company starting to account for an interest on financial debt, which is part of the pre-bankruptcy settlement, and loss realized from sale of part of financial assets. Net financial result was positive in 2018 due to recognition of revenue from liabilities write off according to the pre-bankruptcy settlement in the amount of HRK 91.4 million.

Financial indicators In thousands of HRK
	31.12.2019	31.12.2018 change
Net assets (Capital and reserves)*	46.313	104.806	(58.493)	(56%)
Total debt	359.460	457.466	(98.006)	(21%)
Cash and cash equivalents	3.298	10.340	(7.042)	(68%)
Given loans, deposits and similar**	27.237	32.821	(5.584)	(17%)
Net debt	328.925	414.305	(85.380)	(21%)
Net debt/ EBITDA	17,00	12,71
EBITDA for the last 12 months	19.345	32.600

* Net assets = capital and reserves attributable to the equity holders of the parent and to the minority interests

** Loans given, securities and deposits

Net assets of the Group are lower compared to the value stated at 31 December 2018 due to deconsolidation of financial statements of Žitar d.o.o. and its subsidiary Žitar konto d.o.o. As at 4 March 2019 the Company has signed a contract on the sales of investments into Žitar, and on 14 March 2019 this business event has been recorded in the Court register.

Total debt of the Group has decreased mainly due to deconsolidation of financial liabilities of Žitar, for the amount of compensation of loan liability and receivables in mother company and, in smaller portion, due to repayment of debt by Zdenka – mliječni proizvodi and Granolio d.d.

Separate business results for the twelve months period of 2019

Granolio d.d. In thousands of HRK
	1-12 2019	1-12 2018	change
Operating income	306.355	291.448	14.907	5%
EBIT	(10.795)	(29.342)	18.547	63%
margin %	(4%)	(10%)
EBITDA	(169)	2.885	(3.054)	(106%)
margin %	(0%)	1%
Net financial result	(3.441)	91.110	(94.551)	104%
Net result	(14.236)	61.767	(76.003)	123%
margin %	(4,6%)	21,2%

In 2019 the Company has made lower operating result (EBIT) compared to the last year. The reason for that are high prices of wheat that are not followed by equal increase in sales prices of flour. The second reason is that Company does not have enough working capital to increase volume of trading in sowing materials and crops.

Net financial result represents the difference between financial revenues and financial expenses. In 2019 the Company started to account for an interest on the financial debt which is part of the prebankruptcy settlement.

As at 4 March 2019 the Company has signed a contract on the sales of investments into Žitar, one of its subsidiaries. Since the value of the investment has been impaired to its net realizable value in financial statements for 2018, no profit nor loss from sale of investment has been recognized in Statement of total comprehensive income.

During 2019, the Company diposed 50,000 shares of Zagrebačke pekarne Klara d.d. (17.62% of share capital) form it's portfolio. Disposal resulted in accounting loss in the amount of HRK 3.8 million.

Zdenka - mliječni proizvodi d.o.o.				In thousands of HRK
	1-12 2019	1-12 2018	change
Operating income	156.058	148.587	7.471	5%
EBIT	3.784	5.802	(2.018)	35%
margin %	2%	4%
EBITDA	16.404	20.133	(3.729)	(19%)
margin %	11%	14%
Net financial result	(779)	(780)	1	0%
Net result	3.005	4.025	(1.020)	25%
margin %	2%	3%

In 2019 average prices of raw materials increased compared to the last year. Sales prices of finished goods could not rise proportionally and that has caused decrease in sales margins in 2019 compared to the previous period. Other than that, employee costs have increased compared to the last year.

Zdenačka farma d.o.o. In thousands of HRK

	1-12 2019	1-12 2018	change
Operating income	23.660	23.460	200	1%
EBIT	(331)	850	(1.181)	(139%)
margin %	(1%)	4%
EBITDA	2.711	3.677	(966)	(26%)
margin %	11%	16%
Net financial result	(584)	(679)	95	14%
Net result	(915)	171	(1.086)	(635%)
margin %	(4%)	1%

In 2019 total sales of milk by Zdenačka farma amounted to 4.3 million kilos (2018: 4.5 million kilos). Average sales price realized in 2019 was lower than the average sales price realized in the last year by 6%. Other than by sale of milk, the income was also made from trade in goods.

Employees

In the twelve months 2019 the Group employed 384 employees based on man-hour basis (in the twelve months 2018: 426 employees).

Environment

Regarding the environmental protection, the Group has implemented comprehensive and systematic solutions and established environment-friendly production processes.

Other

Supervisory Board has approved Granolio Group's financial statements for the twelve months period 2019.

Annex 1
		ISSUER'S GENERAL DATA
Reporting period:		1.1.2019	to	31.12.2019
Year:		2019
Quarter:		4.
		Quarterly financial statements
Registration number (MB):	01244272		Issuer's home Member State code:	Croatia
Entity's registration number (MBS):	080111595
Personal identification number (OIB):	59064993527		LEI:	213800O3Z6ZSDBAKG321
Institution code:	15989
Name of the issuer: Granolio d.d
Postcode and town:	10000		Zagreb
Street and house number: Budmanijeva 5
	E-mail address: granolio@granolio.hr
	Web address: www.granolio.hr
Number of employees (end of the reporting	377
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:
	GRANOLIO D.D.			ZAGREB	1244272
	ZDENAČKA FARMA D.O.O.			VELIKI ZDENCI	2095777
	ZDENKA - MLIJEČNI PROIZVODI D.O.O.			VELIKI ZDENCI	1623982
	ŽITAR D.O.O.			DONJI MIHOLJAC	1443119
	ŽITAR KONTO D.O.O.			DONJI MIHOLJAC	4212517
					Yes No
Bookkeeping firm:	No	(Yes/No)		(name of the bookkeeping firm)
	Contact person: Mirjana Kelava
	(only name and surname of the contact person) Telephone: 01/6320-233
	E-mail address: mkelava@granolio.hr
	Audit firm: BDO Croatia d.o.o.
	(name of the audit firm)
Certified auditor: Hrvoje Stipić	(name and surname)

BALANCE SHEET balance as at 31.12.2019.

in HRK

Submitter: Granolio d.d.
Item	ADP code	Last day of the preceding business year	At the reporting date of the current period
1	2	3	4
A) RECEIVABLES FOR SUBSCRIBED CAPITAL UNPAID	001
B) FIXED ASSETS (ADP 003+010+020+031+036)	002	449.163.043	350.595.812 124.612.411
I INTANGIBLE ASSETS (ADP 004 to 009) 1 Research and development	003 004	122.816.990 0	0
2 Concessions, patents, licences, trademarks, software and other
rights	005	120.452.823	123.689.568
3 Goodwill	006	0	0
4 Advances for the purchase of intangible assets	007	0	0
5 Intangible assets in preparation 6 Other intangible assets	008	0	0 922.843
II TANGIBLE ASSETS (ADP 011 to 019)	009 010	2.364.167 315.055.569	223.628.119
1 Land	011	23.643.099	13.824.219
2 Buildings	012	214.789.139	152.690.506
3 Plant and equipment	013	47.911.643	32.940.054
4 Tools, working inventory and transportation assets	014	2.230.274	1.080.047
5 Biological assets	015	9.939.064	6.237.106
6 Advances for the purchase of tangible assets	016	401.922	0
7 Tangible assets in preparation 8 Other tangible assets	017 018	11.013.777 79.651	11.715.891 93.296
9 Investment property	019	5.047.000	5.047.000
III FIXED FINANCIAL ASSETS (ADP 021 to 030)	020	10.172.484	1.252.282
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	025	0	0
participating interests 6 Loans, deposits etc. to companies linked by virtue of participating	026	0	0
interests			0
7 Investments in securities 8 Loans, deposits, etc. given	027 028	0 302.114	221.945
9 Other investments accounted for using the equity method	029	0	0
10 Other fixed financial assets	030	9.870.370	1.030.337
IV RECEIVABLES (ADP 032 to 035)	031	15.000	0
1 Receivables from undertakings within the group	032	0	0
2 Receivables from companies linked by virtue of participating interests	033	0	0
3 Customer receivables	034	0	0
4 Other receivables	035	15.000	0
V DEFERRED TAX ASSETS	036	1.103.000	1.103.000
C) CURRENT ASSETS (ADP 038+046+053+063)	037	244.282.874	184.526.888
I INVENTORIES (ADP 039 to 045)	038	68.515.150	46.239.654
1 Raw materials and consumables	039	21.261.304	21.625.207
2 Work in progress	040	6.808.217	2.097.780
3 Finished goods	041	33.875.722	9.083.323 13.433.344
4 Merchandise 5 Advances for inventories	042 043	6.531.262 38.645	0
6 Fixed assets held for sale	044	0	0
7 Biological assets	045	0	0
II RECEIVABLES (ADP 047 to 052)	046	132.908.459	107.974.087
1 Receivables from undertakings within the group	047	664.746	779.960
2 Receivables from companies linked by virtue of participating interests	048	0	0
3 Customer receivables	049	95.436.009	78.919.646
4 Receivables from employees and members of the undertaking	050	467	0
5 Receivables from government and other institutions	051	5.687.313	3.735.643
6 Other receivables	052	31.119.924	24.538.838
III CURRENT FINANCIAL ASSETS (ADP 054 to 062) 1 Investments in holdings (shares) of undertakings within the group	053 054	32.519.590 0	27.014.667 0
2 Investments in other securities of undertakings within the group	055	0	0
3 Loans, deposits, etc. to undertakings within the group	056	10.190.819	10.190.819
4 Investments in holdings (shares) of companies linked by virtue of
participating interests	057	0	0
5 Investment in other securities of companies linked by virtue of participating interests	058	0	0

6 Loans, deposits etc. to companies linked by virtue of participating	059	0	0
interests 7 Investments in securities			149.624
8 Loans, deposits, etc. given	060 061	178.441 22.150.330	16.674.224
9 Other financial assets	062	0	0
IV CASH AT BANK AND IN HAND	063	10.339.675	3.298.480
D ) PREPAID EXPENSES AND ACCRUED INCOME	064	666.551	398.663
E) TOTAL ASSETS (ADP 001+002+037+064)	065	694.112.468	535.521.363
OFF-BALANCE SHEET ITEMS	066
LIABILITIES			46.313.479
A) CAPITAL AND RESERVES (ADP 068 to I INITIAL (SUBSCRIBED) CAPITAL	067 068	104.806.286 19.016.430	19.016.430
II CAPITAL RESERVES	069	84.195.807	84.195.807
III RESERVES FROM PROFIT (ADP 071+072-073+074+075)	070	1.208.227	4.296.923
1 Legal reserves	071	408.227	3.496.923
2 Reserves for treasury shares	072	800.000	800.000
3 Treasury shares and holdings (deductible item) 4 Statutory reserves	073	0	0 0
5 Other reserves	074 075	0 0	0
IV REVALUATION RESERVES	076	57.678.142	54.675.895
V FAIR VALUE RESERVES (ADP 078 to 080)	077	0	0
1 Fair value of financial assets available for sale	078
2 Cash flow hedge - effective portion	079
3 Hedge of a net investment in a foreign operation - effective portion	080
VI RETAINED PROFIT OR LOSS BROUGHT FORWARD (ADP 082- 083)	081	-199.590.747	-127.054.694
1 Retained profit	082	0	0
2 Loss brought forward	083	199.590.747	127.054.694
VII PROFIT OR LOSS FOR THE BUSINESS YEAR (ADP 085-086)	084	81.861.224	-16.044.266
1 Profit for the business year	085	81.861.224	0
2 Loss for the business year VIII MINORITY (NON-CONTROLLING) INTEREST	086	0	16.044.266 27.227.384
B) PROVISIONS (ADP 089 to 094)	087 088	60.437.203 0	0
1 Provisions for pensions, termination benefits and similar
obligations	089
2 Provisions for tax liabilities	090
3 Provisions for ongoing legal cases	091
4 Provisions for renewal of natural resources	092
5 Provisions for warranty obligations	093
6 Other provisions C) LONG-TERM LIABILITIES (ADP 096 to 106)	094		383.700.217
1 Liabilities to undertakings within the group	095 096	482.627.602 0	10.000.000
			0
2 Liabilities for loans, deposits, etc. of undertakings within the group	097	0
3 Liabilities to companies linked by virtue of participating interests 4 Liabilities for loans, deposits etc. of companies linked by virtue of	098	0	0
participating interests	099	0	0
5 Liabilities for loans, deposits etc.	100	11.126	159.566.584
6 Liabilities to banks and other financial institutions	101	418.048.934	134.006.035
7 Liabilities for advance payments	102	0	0 38.246.490
8 Liabilities to suppliers 9 Liabilities for securities	103 104	51.906.486 0	29.879.082
10 Other long-term liabilities	105	0	0
11 Deferred tax liability	106	12.661.056	12.002.026
D) SHORT-TERM LIABILITIES (ADP 108 to 121)	107	95.537.341	101.845.405
1 Liabilities to undertakings within the group	108	0	0
2 Liabilities for loans, deposits, etc. of undertakings within the group	109	0	0
3 Liabilities to companies linked by virtue of participating interests	110	0	0
4 Liabilities for loans, deposits etc. of companies linked by virtue of	111	0	0
participating interests 5 Liabilities for loans, deposits etc.			6.494.159
6 Liabilities to banks and other financial institutions	112 113	0 30.535.530	9.847.757
7 Liabilities for advance payments	114	668.221	4.403.875
8 Liabilities to suppliers	115	48.362.280	66.755.631
9 Liabilities for securities	116	8.870.000	9.666.218
10 Liabilities to employees	117	2.255.225	2.209.571
11 Taxes, contributions and similar liabilities	118	3.908.720	2.246.635
12 Liabilities arising from the share in the result 13 Liabilities arising from fixed assets held for sale	119 120	0 0	0 0
14 Other short-term liabilities	121	937.365	221.559
E) ACCRUALS AND DEFERRED INCOME	122	11.141.240	3.662.262
F) TOTAL – LIABILITIES (ADP 067+088+095+107+122) G) OFF-BALANCE SHEET ITEMS	123	694.112.469	535.521.363
	124

for the period 01.01.2019 to 31.12.2019 STATEMENT OF PROFIT OR LOSS

in HRK

Submitter: Granolio d.d.
Item	ADP	Same period of the previous year		Current period
	code	Cumulative	Quarter	Cumulative	Quarter
1	2	3	4	5	6
I OPERATING INCOME (ADP 126 to 130)	125	538.570.478	157.157.891	486.133.179	137.796.318
1 Income from sales with undertakings within the group	126	0	0	0	0
2 Income from sales (outside group)	127	505.338.648	139.826.874	468.982.531	132.055.277
3 Income from the use of own products, goods and services	128	10.109.051	8.656.642	1.234.608	227.052
4 Other operating income with undertakings within the group	129	0	0	0	0
5 Other operating income (outside the group) II OPERATING EXPENSES (ADP 132+133+137+141+142+143+146+153)	130 131	23.122.779 542.722.055	8.674.375 158.075.002	15.916.040 493.896.345	5.513.989 137.584.915
1 Changes in inventories of work in progress and finished goods			2.864.784	331.590	52.383
2 Material costs (ADP 134 to 136)	132 133	-102.249 452.459.372	127.215.002	417.713.455	118.231.126
a) Costs of raw materials and consumables	134	300.516.794	76.612.028	305.606.512	78.434.817
b) Costs of goods sold	135	109.576.374	39.019.228	80.212.781	30.468.857
c) Other external costs	136	42.366.204	11.583.746	31.894.162	9.327.452
3 Staff costs (ADP 138 to 140)	137	37.889.329	9.669.832	36.411.471	9.063.377
a) Net salaries and wages	138	24.492.300	6.302.853	23.666.109	5.945.402
b) Tax and contributions from salary costs	139	8.068.778	2.018.712	7.952.573	1.938.569
c) Contributions on salaries	140	5.328.251	1.348.267	4.792.789	1.179.406
4 Depreciation	141	30.584.837	7.626.309	27.086.823	6.601.750
5 Other costs	142	7.746.321	2.825.932	6.509.827	1.894.535
6 Value adjustments (ADP 144+145)	143	6.165.808	6.165.808	21.614	0
a) fixed assets other than financial assets	144	3.625.720	3.625.720	17.767	0
b) current assets other than financial assets	145	2.540.088	2.540.088	3.847	0
7 Provisions (ADP 147 to 152)	146	0	0	0	0
a) Provisions for pensions, termination benefits and similar obligations	147	0	0
b) Provisions for tax liabilities	148	0	0
c) Provisions for ongoing legal cases	149	0	0
d) Provisions for renewal of natural resources	150	0	0
e) Provisions for warranty obligations	151	0	0
f) Other provisions	152	0	0
8 Other operating expenses	153	7.978.637	1.707.335	5.821.565	1.741.744
III FINANCIAL INCOME (ADP 155 to 164)	154	93.926.796	91.611.006	1.513.203	380.552
1 Income from investments in holdings (shares) of undertakings within the group	155	0		0	0
2 Income from investments in holdings (shares) of companies linked by virtue of participating interests	156	0	0	0	0
3 Income from other long-term financial investment and loans granted to undertakings within the group	157	0	0	115.219	115.219
4 Other interest income from operations with undertakings within the group	158	0	0	0	0
5 Exchange rate differences and other financial income from operations with undertakings within the group	159	0	0	0	0
6 Income from other long-term financial investments and loans	160	475.200	0	145.858	46.438
7 Other interest income	161	82.460	34.301	683.311	70.193
8 Exchange rate differences and other financial income	162	1.989.038	196.607	299.461	102.850
9 Unrealised gains (income) from financial assets	163	0	0	0	0
10 Other financial income	164	91.380.098	91.380.098	269.354	45.852
IV FINANCIAL EXPENSES (ADP 166 to 172)	165	4.821.561	1.173.366	8.692.194	1.383.965
1 Interest expenses and similar expenses with undertakings within the group	166	0	0	74.685	74.685
2 Exchange rate differences and other expenses from operations with undertakings within the group	167	0	0	0	0
3 Interest expenses and similar expenses	168	3.774.644	1.067.100	4.267.241	1.113.613
4 Exchange rate differences and other expenses	169	1.024.732	106.216	477.354	192.541
5 Unrealised losses (expenses) from financial assets	170	0	0	0	0
6 Value adjustments of financial assets (net)	171	0	0	0	0
7 Other financial expenses	172	22.185	50	3.872.914	3.126
V SHARE IN PROFIT FROM UNDERTAKINGS LINKED BY VRITUE OF			0	0	0
PARTICIPATING INTERESTS	173	0
VI SHARE IN PROFIT FROM JOINT VENTURES	174	0	0	0	0
VII SHARE IN LOSS OF COMPANIES LINKED BY VIRTUE OF	175	0	0	0	0
PARTICIPATING INTEREST
VIII SHARE IN LOSS OF JOINT VENTURES	176	0	0	0	0
IX TOTAL INCOME (ADP 125+154+173 + 174)	177	632.497.274	248.768.897 159.248.367	487.646.382 502.588.539	138.176.870 138.968.880
X TOTAL EXPENDITURE (ADP 131+165+175 + 176) XI PRE-TAX PROFIT OR LOSS (ADP 177-178)	178 179	547.543.616	89.520.530	-14.942.157	-792.010
1 Pre-tax profit (ADP 177-178)	180	84.953.658 84.953.658	89.520.530	0	0

2 Pre-tax loss (ADP 178-177)	181	0	0	-14.942.157	-792.010
XII INCOME TAX	182	1.013.757	0	0	0
XIII PROFIT OR LOSS FOR THE PERIOD (ADP 179-182)	183	83.939.901	89.520.530	-14.942.157	-792.010
1 Profit for the period (ADP 179-182)	184	83.939.901	89.520.530	0	0
2 Loss for the period (ADP 182-179)	185	0	0	-14.942.157	-792.010
DISCONTINUED OPERATIONS (to be filled in by undertakings subject to IFRS only with discontinued operations)
XIV PRE-TAX PROFIT OR LOSS OF DISCONTINUED OPERATIONS	186	0	0	0	0
(ADP 187-188)
1 Pre-tax profit from discontinued operations	187
2 Pre-tax loss on discontinued operations	188
XV INCOME TAX OF DISCONTINUED OPERATIONS	189
1 Discontinued operations profit for the period (ADP 186-189)	190
2 Discontinued operations loss for the period (ADP 189-186)	191
TOTAL OPERATIONS (to be filled in only by undertakings subject to IFRS with discontinued operations)
XVI PRE-TAX PROFIT OR LOSS (ADP 179+186)	192
1 Pre-tax profit (ADP 192)	193
2 Pre-tax loss (ADP 192)	194
XVII INCOME TAX (ADP 182+189)	195
XVIII PROFIT OR LOSS FOR THE PERIOD (ADP 192-195)	196
1 Profit for the period (ADP 192-195) 2 Loss for the period (ADP 195-192)	197
APPENDIX to the P&L (to be filled in by undertakings that draw up consolidated annual financial statements)	198
XIX PROFIT OR LOSS FOR THE PERIOD (ADP 200+201)	199	83.939.901	89.520.530	-14.942.157	-792.010
1 Attributable to owners of the parent	200	81.861.224	88.295.858	-16.044.267	-1.319.278
2 Attributable to minority (non-controlling) interest	201	2.078.677	1.224.672	1.102.110	527.268
STATEMENT OF OTHER COMPRHENSIVE INCOME (to be filled in by undertakings subject to IFRS)
I PROFIT OR LOSS FOR THE PERIOD	202	83.939.901	89.520.530	-14.942.157	-792.010
II OTHER COMPREHENSIVE INCOME/LOSS BEFORE TAX
(ADP 204 to 211)	203	0	0	0	0
1 Exchange rate differences from translation of foreign operations	204
2 Changes in revaluation reserves of fixed tangible and intangible assets	205
3 Profit or loss arising from subsequent measurement of financial assets
available for sale	206
4 Profit or loss arising from effective cash flow hedging	207
5 Profit or loss arising from effective hedge of a net investment in a foreign operation	208
6 Share in other comprehensive income/loss of companies linked by
virtue of participating interests	209
7 Actuarial gains/losses on the defined benefit obligation	210
8 Other changes in equity unrelated to owners	211
III TAX ON OTHER COMPREHENSIVE INCOME FOR THE PERIOD	212
IV NET OTHER COMPREHENSIVE INCOME OR LOSS (ADP 203-212)	213	0	0	0	0
V COMPREHENSIVE INCOME OR LOSS FOR THE PERIOD (ADP 202+213)	214	83.939.901	89.520.530	-14.942.157	-792.010
APPENDIX to the Statement on comprehensive income (to be filled in by undertakings that draw up consolidated statements)
VI COMPREHENSIVE INCOME OR LOSS FOR THE PERIOD (ADP 216+217)	215	83.939.901	89.520.530	-14.942.157	-792.010
1 Attributable to owners of the parent	216	81.861.224	88.295.858	-16.044.267	-1.319.278
2 Attributable to minority (non-controlling) interest	217	2.078.677	1.224.672	1.102.110	527.268

STATEMENT OF CASH FLOWS - indirect method for the period 01.01.2019. . to 31.12.2019.

Submitter: Granolio 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 2 Adjustments (ADP 003 to 010):	001 002	84.953.659 -62.338.177	-14.942.157 25.545.114
a) Depreciation	003	30.584.836	27.086.823
b) Gains and losses from sale and value adjustment of fixed tangible and	004	3.052.704	235.531
intangible assets c) Gains and losses from sale and unrealised gains and losses and value
adjustment of financial assets	005	-87.769.620	3.670.374
d) Interest and dividend income	006	-1.512.715	-1.329.482
e) Interest expenses	007	3.663.482	4.281.776
f) Provisions g) Exchange rate differences (unrealised)	008 009	0 0	0 37.210
h) Other adjustments for non-cash transactions and unrealised gains and
losses	010	-10.356.864	-8.437.118
I Cash flow increase or decrease before changes in working capital (ADP 001+002)	011	22.615.482	10.602.957
3 Changes in the working capital (ADP 013 to 016)	012	18.850.007	14.897.740
a) Increase or decrease in short-term liabilities	013	-4.810.322	5.920.118
b) Increase or decrease in short-term receivables	014	14.902.384	15.519.539
c) Increase or decrease in inventories d) Other increase or decrease in working capital	015 016	8.757.945 0	-6.541.917 0
II Cash from operations (ADP 011+012)	017	41.465.489	25.500.697
4 Interest paid	018	-3.659.221	-4.143.617
5 Income tax paid	019	-490.000	0
A) NET CASH FLOW FROM OPERATING ACTIVITIES (ADP 017 to 019)	020	37.316.268	21.357.080
Cash flow from investment activities
1 Cash receipts from sales of fixed tangible and intangible assets	021	176.784	894.178
2 Cash receipts from sales of financial instruments	022	0	0
3 Interest received	023	146.327	1.222.099
4 Dividends received	024	0	0
5 Cash receipts from repayment of loans and deposits 6 Other cash receipts from investment activities	025 026	7.437.230 38.488	4.480.801 11.248.563
III Total cash receipts from investment activities (ADP 021 to 026)	027	7.798.829	17.845.641
1 Cash payments for the purchase of fixed tangible and intangible assets	028	-9.847.820	-11.293.862
2 Cash payments for the acquisition of financial instruments	029	0	0
3 Cash payments for loans and deposits for the period	030	-15.987.384	-24.107.591
4 Acquisition of a subsidiary, net of cash acquired	031	0	0
5 Other cash payments from investment activities	032	0	0
IV Total cash payments from investment activities (ADP 028 to 032)	033	-25.835.204	-35.401.453
B) NET CASH FLOW FROM INVESTMENT ACTIVITIES (ADP 027 +033)	034	-18.036.375	-17.555.812
Cash flow from financing activities 1 Cash receipts from the increase in initial (subscribed) capital
2 Cash receipts from the issue of equity financial instruments and debt	035	0	0
financial instruments	036	0	0
3 Cash receipts from credit principals, loans and other borrowings 4 Other cash receipts from financing activities	037 038	43.551.515 0	17.500.000 0
V Total cash receipts from financing activities (ADP 035 to 038)	039	43.551.515	17.500.000
1 Cash payments for the repayment of credit principals, loans and other borrowings and debt financial instruments	040	-53.211.686	-23.479.351
2 Cash payments for dividends	041	0	-2.000.085
3 Cash payments for finance lease	042	-1.465.009	-763.027
4 Cash payments for the redemption of treasury shares and decrease in initial (subscribed) capital	043	0	0
5 Other cash payments from financing activities	044	-1.420.000	-2.100.000
VI Total cash payments from financing activities (ADP 040 to 044)	045	-56.096.695	-28.342.463
C) NET CASH FLOW FROM FINANCING ACTIVITIES (ADP 039 +045)	046	-12.545.180	-10.842.463
1 Unrealised exchange rate differences in respect of cash and cash equivalents	047	0	0
D) NET INCREASE OR DECREASE IN CASH FLOWS (ADP 020+034+046+047)	048	6.734.713	-7.041.195
E) CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE PERIOD	049	3.604.962	10.339.675
F) CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD(ADP 048+049)	050	10.339.675	3.298.480

in HRK

STATEMENT OF CHANGES IN EQUITY

for the period from 1.1.2019	to 31.12.2019															in HRK
Item	ADP code	Initial (subscribed) capital	Capital reserves	Legal reserves	Reserves for treasury shares	Treasury shares and holdings (deductible item)		Statutory reserves Other reserves	Attributable to owners of the parent Revaluation reserves	Fair value of financial assets available for sale	Cash flow hedge - effective portion	Hedge of a net investment in a foreign operation -	Retained profit / loss brought forward	Profit/loss for the business year	Total attributable to owners of the parent	Minority (non controlling) interest	Total capital and reserves
1	2	3	4	5	6	7	8	9	10	11	12	effective portion 13	14	15	16 (3 to 6 - 7 + 8 to 15)	17	18 (16+17)
Previous period
1 Balance on the first day of the previous business year 2 Changes in accounting policies	01 02	19.016.430 0	84.186.547 0	408.227 0	800.000	0 0 0		0 0 0 0	60.117.173 0		0 0	0 0 0 0	-868.308 0	-201.658.850 0	-37.998.781 0	58.358.525 0	20.359.744 0
3 Correction of errors	03	0	0	0		0 0		0 0	0		0	0 0	0	0	0	0	0
4 Balance on the first day of the previous business year (restated) (ADP 01 to 03)	04	19.016.430	84.186.547	408.227	800.000	0		0 0	60.117.173		0	0 0	-868.308	-201.658.850	-37.998.781	58.358.525	20.359.744
5 Profit/loss of the period	05	0	0	0		0 0		0 0	0		0	0 0	0	81.861.224	81.861.224	0	81.861.224
6 Exchange rate differences from translation of foreign operations	06	0	0	0		0 0		0	0		0	0 0	0	0	0	0	0
7 Changes in revaluation reserves of fixed tangible and intangible assets	07	0	0	0		0 0		0 0	-2.996.109		0	0 0	2.996.109		0	0	0
8 Profit or loss arising from subsequent measurement of financial assets available for sale	08	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
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
11 Share in other comprehensive income/loss of companies linked by virtue of participating interests	11	0	0	0		0 0		0 0	0		0	0 0	0		0	0	0
12 Actuarial gains/losses on the defined benefit obligation	12	0	0	0		0 0		0 0	0		0	0 0	0		0	0	0
13 Other changes in equity unrelated to owners	13	0	9.260	0		0 0		0 0	679.363		0	0 0	-726.812	0	-38.189	0	-38.189
14 Tax on transactions recognised directly in equity	14	0	0	0		0 0		0 0	-122.285		0	0 0	492.925		370.640	0	370.640
15 Increase/decrease in initial (subscribed) capital (other than from reinvesting profit and other than arising from the pre-bankruptcy settlement procedure)	15							0	0		0	0 0	0		0	0	0
16 Increase in initial (subscribed) capital arising from the reinvestment of profit	16							0	0		0	0 0	0		0	0	0
17 Increase in initial (subscribed) capital arising from the pre-bankruptcy settlement procedure	17							0	0		0	0 0	0		0	0	0
18 Redemption of treasury shares/holdings	18							0	0		0	0 0	0		0	0	0
19 Payment of share in profit/dividend	19							0	0		0	0 0	0		0	0	0
20 Other distribution to owners	20							0	0		0	0 0	0		0	0	0
21 Transfer to reserves according to the annual schedule 22 Increase in reserves arising from the pre-bankruptcy settlement procedure	21 22							0 0	0 0		0 0	0 0 0 0	-201.662.286 0	201.662.286	0 0	2.355.597 0	2.355.597 0
23 Balance on the last day of the previous business year reporting period (04 to
22)	23	19.016.430	84.195.807	408.227	800.000	0		0 0	57.678.142		0	0 0	-199.768.372	81.864.660	44.194.894	60.714.122	104.909.016
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 OF THE PREVIOUS PERIOD, NET OF TAX (ADP 06 to 14)	24	0	9.260	0		0 0		0 0	-2.439.031		0	0 0	2.762.222	0	332.451	0	332.451
II COMPREHENSIVE INCOME OR LOSS FOR THE PREVIOUS PERIOD (ADP 05+24)	25	0	9.260	0		0 0		0 0	-2.439.031		0	0 0	2.762.222	81.861.224	82.193.675	0	82.193.675
III TRANSACTIONS WITH OWNERS IN THE PREVIOUS PERIOD RECOGNISED DIRECTLY IN EQUITY (ADP 15 to 22)	26	0	0	0		0 0		0 0	0		0	0 0	-201.662.286	201.662.286	0	2.355.597	2.355.597
Current period
1 Balance on the first day of the current business year	27	19.016.430	84.195.807	408.227	800.000	0		0 0	57.678.142		0	0 0	-199.590.748	81.861.224	44.369.082	60.437.203	104.806.285
2 Changes in accounting policies	28	0	0	0		0 0		0 0	0		0	0 0	0	0	0		0
3 Correction of errors	29	0	0	327		0 0		0 0	0		0	0 0	0	0	327		327
4 Balance on the first day of the current business year (restated) (ADP 27 to 29)	30	19.016.430	84.195.807	408.554	800.000	0		0 0	57.678.142		0	0 0	-199.590.748	81.861.224	44.369.409	60.437.203	104.806.612
5 Profit/loss of the period	31	0	0	0		0 0		0 0	0		0	0 0	0	-16.044.266	-16.044.266	1.102.110	-14.942.156
6 Exchange rate differences from translation of foreign operations	32	0	0	0		0 0		0	0		0	0 0	0	0	0	0	0
7 Changes in revaluation reserves of fixed tangible and intangible assets	33	0	0	0		0 0		0 0	-3.002.247		0	0 0	3.002.247		0	0	0
8 Profit or loss arising from subsequent measurement of financial assets available for	34	0	0	0		0 0		0 0	0			0 0			0	0	0
sale 9 Profit or loss arising from effective cash flow hedge	35	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	36	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 participating interests	37	0	0	0		0 0		0							0	0	0
12 Actuarial gains/losses on the defined benefit obligation	38	0	0	0		0 0		0							0	0	0
13 Other changes in equity unrelated to owners	39												-9.898.078	0	-9.898.078	-32.311.844	-42.209.922
14 Tax on transactions recognised directly in equity 15 Increase/decrease in initial (subscribed) capital (other than from reinvesting profit	40	0	0	0		0 0		0					659.030	0	659.030	0	659.030
and other than arising from the pre-bankruptcy settlement procedure)	41												0	0	0	0	0
16 Increase in initial (subscribed) capital arising from the reinvestment of profit	42												0	0	0	0	0
17 Increase in initial (subscribed) capital arising from the pre-bankruptcy settlement procedure	43												0	0	0	0	0
18 Redemption of treasury shares/holdings	44												0	0	0	0	0
19 Payment of share in profit/dividend	45												0	0	0	-2.000.085	-2.000.085
20 Other distribution to owners	46												0	0	0	0	0
21 Transfer to reserves according to the annual schedule 22 Increase in reserves arising from the pre-bankruptcy settlement procedure	47	0	0	3.088.369		0 0		0 0	0		0	0 0	78.772.855	-81.861.224 0	0	0	0
23 Balance on the last day of the current business year reporting period (ADP	48												0		0	0	0
30 to 48)	49	19.016.430	84.195.807	3.496.923	800.000	0		0 0	54.675.895		0	0 0	-127.054.694	-16.044.266	19.086.095	27.227.384	46.313.479
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	50	0	0	0		0 0		0 0	-3.002.247		0	0 0	-6.236.801	0	-9.239.048	-32.311.844	-41.550.892
(ADP 32 to 40)
II COMPREHENSIVE INCOME OR LOSS FOR THE CURRENT PERIOD (ADP 31+50)	51	0	0	0		0 0		0 0	-3.002.247		0	0 0	-6.236.801	-16.044.266	-25.283.314	-31.209.734	-56.493.048
III TRANSACTIONS WITH OWNERS IN THE CURRENT PERIOD RECOGNISED DIRECTLY IN EQUITY (ADP 41 to 48)	52	0	0	3.088.369		0 0		0 0	0		0	0 0	78.772.855	-81.861.224	0	-2.000.085	-2.000.085

NOTES TO FINANCIAL STATEMENTS - TFI (drawn up for quarterly reporting periods)

Name of the issuer: Granolio d.d. Personal identification number (OIB): 59064993527

Reporting period:01.01.2019. -31.12.2019.

Notes to financial statements for quarterly periods include:

The same accounting policies are applied while drawing up financial statements for the six month reporting period as in the latest annual financial statements except for IFRS 16 that applies to the financial statements starting on 1 January 2019. The

effect of applying IFRS 16 on lease contracts concluded prior to January 1, 2019 is reported in the position Loss brought forward.

As at March 4, 2019 the Group carried out the deconsolidation of Žitar d.o.o. and its subsidiary Žitar konto d.o.o.

Deconsolidation caused decrease in value of assets and liabilities as at December 31, 2019 compared to December 31, 2018.

Total debt of the Group has decreased mainly due to deconsolidation of financial liabilities of Žitar, for the amount of compensation of loan liability and receivables in mother company and, in smaller portion, due to repayment of debt by Zdenka – mliječni proizvodi and Granolio d.d.

The result of deconsolidation is shown in the value of Capital and reserves and the value of Noncontrolling Interest.