Granolio d.d.

Quarterly Report • Oct 30, 2018

Consolidated financial results for the nine months period ended 30 September 2018 (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 the Zdenka mliječni proizvodi d.o.o. (further "Zdenka-m.p. d.o.o.") and Žitar d.o.o companies. The above companies have been consolidated into the Granolio Group since 2011.

Subsidiary Žitar d.o.o. has founded another company, Žitar konto d.o.o., which is fully owned by it. Žitar konto d.o.o. financial statements are part of the consolidated financial statements.

Ownership in subsidiaries is presented in the organizational chart below:

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 farms in the companies Zdenačka farma d.o.o. and Žitar d.o.o.

Wholesale trade segment comprises grain and oilseed trade and trade of sowing materials performed by the companies Granolio d.d. and Žitar d.o.o.

The segment Other comprises animal feed production (Žitar d.o.o.), pig farming and beef cattle farming (Žitar d.o.o., beef cattle farming in the company Granolio d.d.), and rendering the silo services and the storage of trade goods (Granolio d.d. and Žitar d.o.o.).

Granolio Group's financial indicators for the nine months period of 2018

			In thousands of HRK
	1-9 2018	1-9 2017	change
Operating income	381.413	426.505	(45.092)	(11%)
Operating expenses	(384.647)	(437.485)	52.838	12%
EBIT	(3.234)	(10.980)	7.746	(71%)
EBIT margin	-1%	(3%)
EBITDA	19.724	13.128	6.596	50%
EBITDA margin	5%	3%
Net financial result	(1.199)	(20.334)	19.135	94%
Net result for the period	(4.433)	(31.314)	26.881	86%
Attributable to the Group	(6.789)	(28.987)	22.198	77%
Non-controlling interest	2.356	(2.327)	4.683	201%

In the nine months of 2018, the Group has made more favorable operating result compared to the same period last year. Operating result has improved in almost all companies within the Group besides Granolio. In the observed period, Granolio recorded significant one-off extraordinary expenses and that was the reason for operating result to decrease compared to the same period last year.

Net financial result in the nine months of 2018 is more favorable than in the same period last year due to the fact that mother company was charged with no interest for the interest bearing debt.

Financial indicators			In thousands of HRK
	30.9.2018	31.12.2017	change
Net assets (Capital and reserves)*	16.256	20.356	(4.100)	(20%)
Total debt	488.805	485.138	3.667	1%
Cash and cash equivalents	5.329	3.605	1.724	48%
Given loans, deposits and similar**	38.743	28.750	9.993	35%
Net debt	444.733	452.783	(8.050)	(2%)
Net debt/ EBITDA	19,82	-28,59
EBITDA for the last 12 months	22.435	(15.839)

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

** Loans given, securities and deposits

Compared to 31 December 2017, net assets decreased due to the negative result for the period.

As at 29 January 2018 Company received a notice on the acquisition of 150,000 shares by HOK osiguranje (that represent 7,89% of ownership). HOK acqured shares in OTC transaction with the pension fund PBZ CROATIA OSIGURANJE. As at 30 September 2018, company HOK held 19,9% of ownership in Granolio.

As at 17 October 2018, Commercial court in Zagreb has determined that the date of the hearing, on which voting for the restructuring plan should take place, is going to be the 22 November 2018. It is expected that the creditors will accept the restructuring plan and that the Company will continue to operate and repay it's debt according to the proposed settlement.

Separate business results for the nine months period of 2018

Granolio d.d. In thousands of HRK
	1-9 2018	1-9 2017	change
Operating income	194.771	267.922	(73.151)	(27%)
EBIT	(10.415)	(8.608)	(1.807)	(21%)
margin %	(5%)	(3%)
EBITDA	(2.612)	(414)	(2.198)	531%
margin %	(1%)	(0%)
Net financial result	319	(17.804)	18.123	102%
Net result	(10.096)	(26.412)	16.316	62%
margin %	(5,2%)	(9,9%)

In the nine months in 2018, Company has made less favorable operating result (EBIT) compared to the same period last year. It was caused by extraordinary one-off costs.

In the nine months in 2018, interest expense on loans received were not charged due to the prebankruptcy process still ongoing. Therefore, in the first half-year 2018, the Company has made net financial income.

As at 14 March 2018, Company and started process of merging it's related party Prerada žitarica into Granolio.

As at 30 April 2018, Commercial court in Zagreb has reached a resolution on the forementioned merger by which the company Prerada žitarica ceased to exist.

Zdenka - mliječni proizvodi d.o.o.			In thousands of HRK
	1-9 2018	1-9 2017		change
Operating income	110.866	110.964	(98)	(0%)
EBIT	5.225	(2.021)	7.246	359%
margin %	5%	(2%)
EBITDA	14.434	7.550	6.884	91%
margin %	13%	7%
Net financial result	(577)	(1.144)	567	50%
Net result	4.648	(3.165)	7.813	247%
margin %	4%	(3%)

In nine months of 2018, the company has made better operating result compared to the result in the same period last year.

Žitar d.o.o. (consolidated) In thousands of HRK

	1-9 2018	1-9 2017		change
Operating income	62.016	38.090	23.926	63%
EBIT	843	(299)	1.142	(382%)
margin %	1%	(1%)
EBITDA	4.518	3.574	944	26%
margin %	7%	9%
Net financial result	(779)	(1.182)	403	34%
Net result	64	(1.481)	1.545	104%
margin %	0%	(4%)

Žitar's operating activities include agriculture, production of milk on a dairy farms, cattle breeding, rendering services of storing goods and trade in crops.

Zdenačka farma d.o.o.				In thousands of HRK
	1-9 2018	1-9 2017		change
Operating income	17.415	15.197	2.218	15%
EBIT	1.231	500	731	146%
margin %	7%	3%
EBITDA	3.362	2.655	707	27%
margin %	19%	17%
Net financial result	(516)	(656)	140	21%
Net result	715	(156)	871	(558%)
margin %	4%	(1%)

In the nine months of 2018 total sales of milk by Zdenačka farma amounted to 3,4 million kilos (1-9 2017: 3,4 million kilos). Average sales price realised in the nine months of 2018 was almost as equal as the average sales price realised in the same period last year. In 2018 the income was also made from trade in goods.

Employees

In the nine months 2018 the Group employed 423 employees based on man-hour basis (in the nine months 2017: 452 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 nine months period 2018.

Annex 1.
Reporting period		1.1.2018	to		30.9.2018
			Quarterly financial report TFI-POD
Tax number (MB):	01244272
Company registration number (MBS):	080111595
Personal identification number (OIB):	59064993527
Issuing company: GRANOLIO d.d.
Postal code and place	10000		ZAGREB
Street and house number: BUDMANIJEVA 5
E-mail address: granolio@granolio.hr
Internet address www.granolio.hr
Municipality/city code and name 133
County code and name 21	GRAD ZAGREB				Number of employees:	423
Consolidated report: YES					(period end) NKD code:	1061
Companies of the consolidation subject (according to IFRS):			Seat:		MB:
	GRANOLIO D.D.			ZAGREB	01244272
ZDENAČKA FARMA D.O.O.				VELIKI ZDENCI	02095777
PRERADA ŽITARICA D.O.O.				GRUBIŠNO POLJE	02095696
ZDENKA - MLIJEČNI PROIZVODI D.O.O.				VELIKI ZDENCI	01623982
	ŽITAR D.O.O.			DONJI MIHOLJAC	01443119
	ŽITAR KONTO D.O.O.			DONJI MIHOLJAC	04212517
Bookkeeping service:
JASENKA KORDIĆ Contact person:
Telephone: 01/6320-261	(only surname and name)			Telefax:	01/6320-224
E-mail address: jkordic@granolio.hr
Family name and name: HRVOJE FILIPOVIĆ	(person authorized to represent the company)
Documentation for public disclosure: 1. Financial statements (balance sheet, income statement, cash flow statement, statement of changes in equity, notes to the financial statements) 2. Non-consolidated financial results for the 12 months period ended 31 December 2016, 3. Management Board statement of liability and Statements of responsibility of executives responsible for preparing financial statements.
		L.S.			(signature of the person authorized to represent the company)

Balance Sheet

as of 30.09.2018

Company: GRANOLIO d.d.
Position	AOP	Previous period	Current period
1	2	3	4
ASSETS
A) RECEIVABLES FOR SUBSCRIBED BUT NOT PAID-IN CAPITAL	001
B) LONG-TERM ASSETS (003+010+020+031+036)	002	468.986.689	452.702.893
I. INTANGIBLE ASSETS (004 do 009)	003	124.767.302	123.367.193
1. Assets development	004	0	0
2. Concessions, patents, licenses, trademarks, service marks, software and other rights	005	120.737.135	120.586.526
3. Goodwill	006	0	0
4. Prepayments for purchase of intangible assets 5. Intangible assets in preparation	007	0	0
6. Other intangible assets	008 009	0 4.030.167	0 2.780.667
II. TANGIBLE ASSETS (011 do 019)	010	328.212.154	313.328.466
1. Land	011	23.610.097	23.643.097
2. Buildings	012	223.325.464	216.348.685
3. Plant and equipement	013	56.943.128	49.455.477
4. Tools, working inventory and transportation assets	014	2.917.588	2.131.113
5. Biological assets	015	10.110.572	9.716.952
6. Prepayments for tangible assets	016	355.095	283.777
7. Tangible assets in progress	017	10.437.015	11.237.609
8. Other tangible assets	018	81.195	79.756
9. Investments in buildings	019	432.000	432.000 13.892.234
III. LONG-TERM FINANCIAL ASSETS (021 do 030) 1. Investments (shares) with related parties within the Group	020 021	13.892.233 0	0
2. Investments in other securities of related parties within the Group	022	0	0
3. Loans, deposits and similar assets to related parties within the Group	023	0	0
4. Investments (shares) with entrepreneurs in whom the entity holds participating interests	024	0	0
5. Investments in other securities of entrepreneurs in whom the entity holds participating interests	025	0	0
6. Loans, deposits and similar assets to entrepreneurs in whom the entity holds participating
interests	026	0	0
7. Investments in securities	027	0	0
8. Loans, deposits and similar assets	028	396.143	396.144
9. Other investments accounted by equity method	029	0	0
10. Other long - term financial assets	030	13.496.090	13.496.090 15.000
IV. RECEIVABLES (032 do 035) 1. Receivables from related parties within the Group	031 032	15.000 0	0
2. Receivables from participating parties	033	0	0
3. Accounts receivable	034	0	0
4. Other receivables	035	15.000	15.000
V. DEFERRED TAX ASSET	036	2.100.000	2.100.000
C) SHORT TERM ASSETS (038+046+053+063)	037	254.673.903	282.385.752
I. INVENTORIES (039 do 045)	038	74.430.389	91.449.874
1. Raw materials and supplies	039	23.586.432	23.976.900
2. Work in progress	040	8.376.188	6.525.847
3. Finished goods	041	33.251.567	37.528.396
4. Merchandise 5. Prepayments for inventories	042	9.130.745	23.403.159 15.572
6. Long term assets held for sale	043 044	85.457 0	0
7. Biological assets	045	0	0
II. RECEIVABLES (047 do 052)	046	148.285.115	147.260.711
1. Receivables from related parties within the Group	047	492.726	492.724
2. Receivables from participating parties	048	0	0
3. Accounts receivable	049	112.470.877	107.839.431
4. Receivables from employees and members of related parties	050	3.526	3.686
5. Receivables from government and other institutions	051	8.710.729	9.691.198
6. Other receivables	052	26.607.258	29.233.672
III. SHORT TERM FINANCIAL ASSETS (054 do 062)	053	28.353.437	38.346.660
1. Investments (shares) with related parties within the Group	054	0	0 0
2. Investments in other securities of related parties within the Group 3. Loans, deposits and similar assets to related parties within the Group	055 056	0 14.676.132	14.656.132
4. Investments (shares) with entrepreneurs in whom the entity holds participating interests	057	0	0
5. Investments in other securities of entrepreneurs in whom the entity holds participating interests	058	0	0
6. Loans, deposits and similar assets to entrepreneurs in whom the entity holds participating	059	0	0
7. Investments in securities	060	178.441	179.272
8. Loans, deposits and similar assets	061	13.498.864	23.511.255
9. Other financial assets	062	0	0
IV. CASH AND CASH EQUIVALENTS	063	3.604.962	5.328.507
D) PREPAID EXPENSES AND ACCRUED REVENUE	064	1.278.706	1.442.582
E) TOTAL ASSETS (001+002+037+064) F) OFF-BALANCE RECORDS	065	724.939.299	736.531.227
	066

EQUITY AND LIABILITIES
A) ISSUED CAPITAL AND RESERVES (068 do 070+076+077+081+084+087)	067	20.356.307	16.255.590
I. SUBSCRIBED SHARE CAPITAL	068	19.016.430	19.016.430
II. CAPITAL RESERVES	069	84.186.547	84.195.807
III.RESERVES FROM PROFIT (071+072-073+074+075)	070	1.208.554	1.208.554
1. Reserves prescribed by law	071	408.554	408.554
2. Reserves for treasury shares	072	800.000	800.000
3. Treasury shares (deductible items)	073
4. Statutory reserves	074
5. Other reserves	075
IV. REVALUATION RESERVES	076	60.117.173	58.428.704
V. FAIR VALUE RESERVES(078-080)	077
1. Fair value of financial assets available for sale	078
2. Efficient part of cash flow hedging	079
3. Efficient part of hedging of a net investment in foreign countries	080
V. RETAINED EARNINGS OR ACCUMULATED LOSS (082-083)	081	-868.634	-200.519.260
1. Retained earnings	082
2. Accumulated loss	083	868.634	200.519.260
VI. PROFIT/LOSS FOR THE CURRENT YEAR (085-086)	084	-201.662.286	$-6.788.765$
1. Profit for the current year	085
2. Loss for the current year	086	201.662.286	6.788.765
VII. MINORITY (NON-CONTROLLING) INTEREST	087	58.358.525	60.714.121
B) PROVISIONS (089 do 094)	088	0	$\mathbf{0}$
1. Provisions for pensions, severance pay and similar libabilities	089
2. Provisions for tax liabilities	090
3. Provisions for ongoing legal cases	091
4. Provisions for costs of natural resources regeneration	092
5. Provisions for guarantees costs	093
6. Other provisions	094
C) LONG - TERM LIABILITIES (096 do 106)	095	85.269.845	71.314.497
1. Liabilites to related parties within the Group	096	0	$\pmb{0}$
2. Liabilities for loans, deposits, etc. to related parties within the Group	097	$\Omega$	$\pmb{0}$
3. Liabilities to entrepreneurs in whom the entity holds participating interests	098	$\Omega$	$\pmb{0}$
4. Liabilities for loans, deposits, etc. to entrepreneurs in whom the entity holds participating	099		$\mathbf 0$
5. Liabilities for loans, deposits, etc.	100	11.270	11.003
6. Liabilities to banks and other financial institutions	101	71.876.349	58.291.909
7. Liabilities for received prepayments	102		$\mathbf{0}$
8. Accounts payable	103	185.773	185.772
9. Liabilities arising from debt securities	104	0	0
10. Other long-term liabilities	105		$\mathbf 0$
11. Deferred tax liability	106	13.196.453	12.825.813
D) SHORT - TERM LIABILITIES (108 do 121)	107	605.933.816	634.891.289
1. Liabilites to related parties within the Group	108	$\Omega$	$\mathbf 0$
2. Liabilities for loans, deposits, etc. to related parties within the Group	109	0	$\pmb{0}$
3. Liabilities to entrepreneurs in whom the entity holds participating interests	110	$\Omega$	$\pmb{0}$
4. Liabilities for loans, deposits, etc. to entrepreneurs in whom the entity holds participating	111	0	$\mathbf 0$
5. Liabilities for loans, deposits, etc.	112	0	17.215.500
6. Liabilities to banks and other financial institutions	113	366.510.252	367.965.548
7. Liabilities for received prepayments	114	2.985.710	2.705.021
8. Accounts payable	115	102.605.008	116.844.105
9. Liabilities arising from debt securities	116	46.740.600	45.320.600
10. Liabilities to employees	117	2.188.819	2.211.382
11. Liabilities for taxes, contributions and similar fees	118	4.014.406	3.341.124
12. Liabilities to share - holders	119	0	0
13. Liabilities for long-term assets held for sale	120	0	$\mathbf 0$
14. Other short - term liabilities	121	80.889.021	79.288.009
E) DEFFERED SETTLEMENTS OF CHARGES AND INCOME DEFERRED TO FUTURE PERIOD	122	13.379.330	14.069.851
F) TOTAL - CAPITAL AND LIABILITIES $(067+088+095+107+122)$	123	724.939.298	736.531.227
G) OFF-BALANCE RECORDS	124
APPENDIX to balance sheet (to be filled in by entrepreneur that prepares consolidated financial statements)
A) CAPITAL AND RESERVES
1. Attributed to equity holders of parent company	125	$-38.002.217$	-44.458.531
2. Attributable to minority interest	126	58.358.525	60.714.121

Note 1.: Appendix to the balance sheet to be filled by entrepreneurs that prepare consolidated financial statements.

Income statement

period 01.01.2018 to 30.09.2018

Position	AOP		Previous period		Current period
		Cummulative	Quarter	Cummulative	Quarter
1	2	3	4	5	6
I. OPERATING REVENUE (125+130)	125	426.504.773	138.732.815	381.412.587	143.308.649
1. Sales revenue with related parties with the Group	126	0	0	0	0
2. Sales revenue (other parties)	127	411.728.634	132.439.521	365.511.774	135.684.175
3. Revenue from the use of own products, goods and services	128	1.443.129	1.443.129	1.452.409	437.141
4. Other operating revenue with related parties with the Group	129	0	0 4.850.165	0 14.448.404	0 7.187.333
5. Other operating revenue (other parties)	130	13.333.010	137.903.919	384.647.053	143.406.175
II. OPERATING COSTS (132+133+137+141+142+143+146+153) 1. Changes in value of work in progress and finished products	131 132	437.485.371 -1.894.911	3.245.425	-2.967.033	3.763.642
2. Material costs (133 do 136)	133	368.774.704	113.046.553	325.244.370	119.159.898
a) Raw material and material costs	134	199.127.782	65.035.409	223.904.766	79.732.490
b) Cost of goods sold	135	137.119.147	37.109.904	70.557.146	26.170.128
c) Other external costs	136	32.527.775	10.901.240	30.782.458	13.257.279
3. Staff costs (138 do 140)	137	31.427.220	9.602.101	28.219.497	9.633.564
a) Net salaries and wages	138	19.702.246	6.133.908	18.189.447	6.227.435
b) Tax and contributions from salary expenses	139	7.084.444	2.047.036	6.050.066	2.051.607
c) Contributions on gross salaries	140	4.640.530	1.421.157	3.979.985	1.354.522
4. Depreciation and amortisation	141	24.107.445	7.933.008	22.958.526	7.605.885
5. Other costs	142	5.608.608	1.676.111	4.920.389	1.446.644
6. Impairment (144+145)	143	1.377	1.377	0	0
a) Impairment of long-term assets (financial assets excluded)	144
b) Impairment of short - term assets (financial assets excluded)	145	1.377	1.377
7. Provisions (147 do 152)	146				0
a) Provisions for pensions, severance pay and similar libabilities b) Provisions for tax liabilities	147
c) Provisions for ongoing legal cases	148 149
d) Provisions for costs of natural resources regeneration	150
e) Provisions for guarantees costs	151
f) Other provisions	152
8. Other operating costs	153	9.460.928	2.399.344	6.271.304	1.796.542
III. FINANCIAL INCOME (155 do 164)	154	4.441.704	728.421	2.449.494	273.817
1. Income from investment in shares in related parties within the Group	155	0	0	0	0
2. Income from investment in shares of entrepreneurs in whom the entity holds participating	156	0	0	0	0
3. Income from other long-term financial investment and loans granted to related parties	157	0	0	0	0
4. Other income arising from interests with related parties within the Group	158	0	0	0	0
5. Foreign exchange gains and similar financial income with related parties within the Group	159	0	0 0	0 542.052	0 189.776
6. Income from other long-term financial investment and loans 7. Other income arising from interests	160 161	593.736 171.853	0	48.159	28.240
8. Foreign exchange gains and similar financial income	162	2.536.858	672.884	1.859.283	55.801
9. Unrealized gains (income) from financial assets	163	0	0	0	0
10. Other financial income	164	1.139.256	55.537	0	0
IV. FINANCIAL EXPENSES (166 do 172)	165	24.775.358	8.632.139	3.648.196	1.448.492
1. Expenses arising from interests and similar expenses with related parties within the Group	166	0	0	0	0
2. Foreign exchange losses and similar financial expenses with related parties within the	167	0	0	0	0
3. Expenses arising from interests and similar expenses	168	22.650.457	6.538.702	2.707.545	835.283
4. Foreign exchange losses and similar financial expenses	169	2.092.173	2.092.173	918.516	612.685
5. Unrealized losses (expenses) on financial assets	170	0	0	0	0
6. Financial assets impairment (net)	171	0	0 1.264	0 22.135	0 524
7. Other financial expenses	172	32.728
V. SHARE IN PARTICIPATING INTERESTS PROFIT	173
VI. SHARE IN JOINT-VENTURE PROFIT	174
VII. SHARE IN PARTICIPATING INTERESTS LOSS	175
VIII. SHARE IN JOINT-VENTURE LOSS	176
IX. TOTAL INCOME (125+164+173 + 174)	177	430.946.477	139.461.236	383.862.081	143.582.466
X. TOTAL EXPENSES (131+165+175 + 176)	178	462.260.729	146.536.058	388.295.249	144.854.667
XI. PROFIT OR LOSS BEFORE TAXES (177-178)	179	-31.314.252	-7.074.822	-4.433.168	-1.272.201
1. Profit before taxes (177-178)	180	0	0	0	0
2. Loss before taxes (178-177)	181	31.314.252	7.074.822	4.433.168	1.272.201
XII. PROFIT TAX	182
XIII. PROFIT OR LOSS FOR THE PERIOD (179-182)	183	-31.314.252	-7.074.822	-4.433.168	-1.272.201
1. Profit for the period (179-182) 2. Loss for the period (182-179)	184	0 31.314.252	0 7.074.822	0 4.433.168	0 1.272.201
APPENDIX to income statement (to be filled in by entrepreneur that prepares consolidated financial statements)	185
XIV. PROFIT OR LOSS FOR THE PERIOD
1. Attributed to equity holders of parent company	186	-28.986.676	-5.952.575	-6.788.765	-2.554.892
2. Attributable to minority interest	187	-2.327.576	-1.122.246	2.355.597	1.282.691
STATEMENT OF OTHER COMPREHENSIVE INCOME (only for IFRS adopters)
I. PROFIT OR LOSS FOR THE PERIOD	188	-31.314.252	-7.074.822	-4.433.168	-1.272.201
II. OTHER COMPREHENSIVE INCOME/LOSS BEFORE TAXES (190 do 197)	189	0	0	0	0
1. Exchange differences on translation of foreign operations	190
2. Movements in revaluation reserves of long - term tangible and intangible assets	191
3. Profit or loss arising from re-evaluation of financial assets available for sale 4. Gains or losses arising on efficient cash flow hedging	192 193
5. Gains or losses arising on efficient hedge of a net investment in foreign countries	194
6. Share in other comprehensive income / loss of participating interest companies	195
7. Actuarial gains / losses on defined benefit plans	196
8. Other changes in equity non related to the owners	197
III. TAX ON OTHER COMPREHENSIVE INCOME FOR THE PERIOD	198
IV. NET OTHER COMPREHENSIVE INCOME OR LOSS FOR THE PERIOD (158-166)	199	0	0	0	0
V. COMPREHENSIVE INCOME OR LOSS FOR THE PERIOD (188+199)	200	-31.314.252	-7.074.822	-4.433.168	-1.272.201
APPENDIX to other comprehensive income statement (to be filled in by entrepreneur that prepares consolidated financial statements)
VI. COMPREHENSIVE INCOME OR LOSS FOR THE PERIOD
1. Attributed to equity holders of parent company 2. Attributed to minority interest	201 202	-28.986.676 -2.327.576	-5.952.575 -1.122.246	-6.788.765 2.355.597	-2.554.892 1.282.691

Cash flow statement - indirect method period 01.01.2018 to 30.09.2018

Company: GRANOLIO d.d.
Position	AOP	Previous	Current period
1	2	period 3	4
CASH FLOWS FROM OPERATING ACTIVITIES
1. Profit before tax	001	(31.314.250)	(4.433.169)
2. Adjustments (003 do 010)	002	47.393.179	21.068.252
a.) Depreciation and amortisation	003	24.107.445	22.958.527
b.) Gains and losses from the sale and impairment of long-term tangible and		3.086.935
intangible assets	004		2.465.398
c.) Gains and losses from the sale and unrealised gains and losses and		(926.192)
impairment of financial assets	005
d.) Interests and dividends income	006	0	(589.947)
e.) Interests expense	007	21.525.275	2.567.460
f.) Provisions	008
g .) Foreign exchange differences (unrealised)	009	-	(1.035.612)
h.) Other adjustments for non-cash transactions and unrealised gains and
losses	010	(400.285)	(5.297.573)
I. Cash flow increase or decrease before changes in the working capital
(001 do 002)	011	16.078.929	16.635.083
3. Working capital changes ( 013 do 016)	012	50.978.054	1.288.502
a.) Increase or decrease in short term liabilities	013	22.800.707	13.487.803
b.) Increase or decrease in short term receivables	014	14.161.618	4.870.927
c.) Increase or decrease in inventories	015	18.843.226	(17.070.228)
d.) Other increase or decrease in the working capital	016	(4.827.497)
II. Cash from operations (011+012)	017	67.056.983	17.923.585
4. Interests paid	018	0	(2.619.238)
5. Income tax paid	019	(1.500.633)	(490.000)
A) NET CASH FLOW FROM OPERATING ACTIVITIES (017 do 019)	020	65.556.350	14.814.347
CASH FLOW FROM INVESTING ACTIVITIES
1. Cash inflows from sales of long-term tangible and intangible assets	021	80.917	-
2. Cash inflow from the sale of financial instruments	022	-	-
3. Interests receipts	023	929.629	83.945
4. Dividends receipts	024	0
5. Cash inflow from repayment of given loans and other borrowings	025	4.807.320	153.498
6. Other cash inflows from investing activities	026	795.584	(9.786)
III. Total cash inflows from investing activities (021 do 026)	027	6.613.450	227.657
1. Cash outflow for purchase of long-term tangible and intangible assets	028	(6.719.086)	(5.990.004)
2. Cash outflow for acquisition of financial instruments	029
3. Cash outflow for granting loans and other borrowings in the given period	030	(21.937.319)	(10.136.103)
4. Aquisition of associates decreased by the acquired cash	031
5. Other cash outflow for investing activities	032	0
IV. Total cash outflow for investing activities (028 do 032)	033	(28.656.405)	(16.126.107)
B) NET CASH FLOW FROM INVESTING ACTIVITIES (027+033)	034	(22.042.955)	(15.898.450)
CASH FLOW FROM FINANCING ACTIVITIES
1. Cash inflow from increase of the share (subscribed) capital	035	0
2. Cash inflow from issuing property and debt financial instruments	036	0
3. Cash proceeds from the credit principals, promissory notes, borrowings and
other loans	037	87.540.589	35.551.515
4. Other proceeds from financial activities	038
V. Total cash inflows from financial activities (027 do 029)	039	87.540.589	35.551.515
1. Cash outflow for repayment of credit principals, promissory notes,
borrowings and other loans	040	(113.540.558)	(30.187.042)
2. Cash outflow for dividends paid	041	-
3. Cash outflow for financial lease	042	(1.577.583)	(1.136.826)
4. Cash outflow for purchase of treasury shares and decrease of share
(subscribed) capital	043
5. Other cash outflow for financial activities	044	(22.779.309)	(1.420.000)
VI. Total cash outflow for financial activities (031 do 035)	045	(137.897.450)	(32.743.868)
C) NET CASH FLOW FROM FINANCIAL ACTIVITIES	046	(50.356.861)	2.807.647
1. Unrealised foreign exchange differences in cash and cash equivalents	047	0
D) NET INCREASE OR DECREASE IN CASH FLOW (020+034+046+047)	048	(6.843.465)	1.723.545
E) CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE PERIOD	049	9.729.371	3.604.962
F) CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD	050	2.885.905	5.328.507

Statement of changes in equity Obrazac POD-PK 01.01.2018-30.09.2018

Obrazac POD-PK

Company: GRANOLIO D.D. ,OIB 59064993527
			Attributable to the equity holders of the parent									Minority
Position	AOP	Note no.	Share (subscribed) capital	Capital reserves	Legal reserves	Reserves for treasury shares	Treasury shares (deductible)	Statutory reserves	Other reserves	Revaluation reserve	Fair value of financial assets available for sale	Efficient part of cash flow hedging	Efficient part of hedging of a net investment	Retained earnings / accumulate d loss	Profit / loss for the current year	Total attributable to the equity holders of the parent	(non controlling) interest	Total capital and reserves
1	2	3	4	5	6	7	8	9	10	11	12	13	14	15	16	17 (4 do 7 - 8	18	19 (17+18)
Prior period
1. Balance 1 January of the prior period	01		19.016.430	84.186.547	283.227	800.000				61.561.956				7.812.413		2.406.269 176.066.842 61.141.415 237.208.257
2. Changes in accounting policies	02															0		0
3. Correction of errors	03															0		0
4. Balance 1 January of the prior period (AOP 01 do 03)	04		19.016.430	84.186.547	283.227	800.000		0 0		0 61.561.956		0 0		0 7.812.413		2.406.269 176.066.842 61.141.415 237.208.257
5. Profit / loss for the period	05															-28.986.676 -28.986.676 -2.327.576 -31.314.252
6. Exchange differences on translation of foreign operations	06															0		0
7. Changes in revaluation reserves of long-term tangible and intangible assets	07									-2.237.874				2.237.874		0		0
8. Profit or loss from re-evaluation of financial assets available for sale	08															0		0
9. Gains or losses arising on efficient cash flow hedging	09															0		0
10. Gains or losses arising on efficient hedge of a net investment in foreign countries	10															0		0
11. Share in other comprehensive income / loss of participating interest companies	11															0		0
12. Actuarial gains / losses on defined benefit plans	12															0		0
13. Other changes in equity non related to the owners	13													34.943		34.943		34.943
14. Taxation recognised directly in equity	14									1.539.049				491.241		2.030.290		2.030.290
15. Increase/decrease in share (subscribed) capital (other than from reinvesting profit and other than arising from the pre-bankuptcy settlement procedure)	15															0		0
16. Increase of share (subscribed) capital by reinvesting profit	16															0		0
17. Increase of share (subscribed) capital arising from the pre-bankruptcy settlement procedure	17															0		0
18. Redemption of own (treasury) shares	18															0		0
19. Payment of share in profit / dividends	19															0		0
20. Other distribution of profits to the owners	20															0		0
21. Transfer to reserves by annual schedule	21				125.327										2.280.942 -2.406.269	0		0
22. Increase in reserves arising from the pre-bankruptcy settlement procedure	22															0		0
23. Balance 30 of Yune the prior period (04 do 22)	23		19.016.430	84.186.547	408.554	800.000		0 0		0 60.863.131		0 0				0 12.857.413 -28.986.676 149.145.399 58.813.839 207.959.238
APPENDIX TO THE STATEMENT OF CHANGES IN EQUITY (to be filled in by entrepreneur that prepares financial statements in accordance to IFRS)
I. OTHER COMPREHENSIVE INCOME OF THE PRIOR PERIOD, NET OF TAX (AOP 06 to 14)	24		0	0		0 0		0 0		0	0	0 0	0		0	0	0 0	0
II. COMPREHENSIVE INCOME OR LOSS OF THE PRIOR PERIOD (AOP 05+24)	25		0	0		0 0		0 0		0	0	0 0	0		0	0	0 0	0
III. TRANSACTIONS WITH THE OWNERS OF THE PRIOR PERIOD RECOGNISED DIRECTLY IN EQUITY (AOP 15 to 22)	26		0	0		0 0		0 0		0	0	0 0	0		0	0	0 0	0

Statement of changes in equity Obrazac POD-PK 01.01.2018-30.09.2018

Company: GRANOLIO D.D. ,OIB 59064993527
										Attributable to the equity holders of the parent							Minority
Position	AOP	Note no.	Share (subscribed) capital	Capital reserves	Legal reserves	Reserves for treasury shares	Treasury shares (deductible)	Statutory reserves	Other reserves	Revaluation reserve	Fair value of financial assets available for	Efficient part of cash flow hedging	Efficient part of hedging of a net	Retained earnings / accumulate d loss	Profit / loss for the current year	Total attributable to the equity holders of	(non controlling) interest	Total capital and reserves
1	2	3	4	5	6	7	8	9	10	11	sale 12	13	investment 14	15	16	the parent 17 (4 do 7 - 8	18	19 (17+18)
Current period
1. Balance 1 January of the current period	27		19.016.430	84.186.547	408.554	800.000				60.117.173					-868.634 -201.662.286 -38.002.216 58.358.525 20.356.309
2. Changes in accounting policies	28															0		0
3. Correction of errors	29															0		0
4. Balance 1 January of the current period (AOP 27 do 29)	30		19.016.430	84.186.547	408.554	800.000	0	0		0 60.117.173	0	0			0 -868.634 -201.662.286 -38.002.216 58.358.525 20.356.309
5. Profit / loss for the period	31															-6.788.765 -6.788.765 2.355.597 -4.433.168
6. Exchange differences on translation of foreign operations	32															0		0
7. Changes in revaluation reserves of long-term tangible and intangible assets	33									-2.245.547				2.245.547		0		0
8. Profit or loss from re-evaluation of financial assets available for sale	34															0		0
9. Gains or losses arising on efficient cash flow hedging	35															0		0
10. Gains or losses arising on efficient hedge of a net investment in foreign countries	36															0		0
11. Share in other comprehensive income / loss of participating interest companies	37															0		0
12. Actuarial gains / losses on defined benefit plans	38															0		0
13. Other changes in equity non related to the owners	39			9.260						679.363				-726.812		-38.189		-38.189
14. Taxation recognised directly in equity	40									-122.285				492.925		370.640		370.640
15. Increase/decrease in share (subscribed) capital (other than from reinvesting profit and other than arising from the pre-bankuptcy settlement procedure)	41															0		0
16. Increase of share (subscribed) capital by reinvesting profit	42															0		0
17. Increase of share (subscribed) capital arising from the pre-bankruptcy settlement procedure	43															0		0
18. Redemption of own (treasury) shares	44															0		0
19. Payment of share in profit / dividends	45															0		0
20. Other distribution of profits to the owners	46															0		0
21. Transfer to reserves by annual schedule	47														-201.662.286 201.662.286	0		0
22. Increase in reserves arising from the pre-bankruptcy settlement procedure	48															0		0
23. Balance 30 Yune of the prior period (04 do 22)	49		19.016.430	84.195.807	408.554	800.000	0	0		0 58.428.704	0	0			0 -200.519.260 -6.788.765 -44.458.530 60.714.122 16.255.592
APPENDIX TO THE STATEMENT OF CHANGES IN EQUITY (to be filled in by entrepreneur that prepares financial statements in accordance to IFRS)
I. OTHER COMPREHENSIVE INCOME OF THE CURRENT PERIOD, NET OF TAX (AOP 32 to 40)	50		0	0		0	0 0	0		0 0	0	0	0	0	0	0	0	0
II. COMPREHENSIVE INCOME OR LOSS OF THE CURRENT PERIOD (AOP 31 + 50)	51		0	0		0	0 0	0		0 0	0	0	0	0	0	0	0	0
III. TRANSACTIONS WITH THE OWNERS OF THE CURRENT PERIOD RECOGNISED DIRECTLY IN EQUITY (AOP 41 to 48)	52		0	0		0	0 0	0		0 0	0	0	0	0	0	0	0	0

Budmanijeva 5, HR-10000 Zagreb tel.: +385 1 6320 200; faks: +385 1 6320 222; e-mail: granolio@granolio.hr; http://www.granolio.hr

In Zagreb, 30 October 2018

Pursuant to the article 407. to 410. of the Capital market Law (Official Gazette 88/08, 146/08 and 74/09) the President of the Management Board of the Company Granolio d.d., Budmanijeva 5, Zagreb provides:

MANAGEMENT BOARD'S STATEMENT OF LIABILITY

The separate and consolidated financial statements of Granolio d.d. have been prepared pursuant to the International Financial Reporting Standards (IFRS) and Croatian Accounting Law.

The non-consolidated and consolidated financial statements for the period from 1 January 2018 till 30 September 2018 present complete and fair view of assets and liabilities, profit and loss, financial position and operations of the Company.

The management report for the nine months period ended 30 September 2018 presents true and fair presentation of development and results of the Company's operations with description of significant risks and uncertainties the Company is facing.

President of the Management Board

Hrvoje Filipović

4 d. Rudmanijeva š Zagrab

Contact: Granolio d.d. Budmanijeva 5 10 000 Zagreb Hrvatska

DNV-GL

$NMSG1$

Tel: +385 1 6320 200 e-mail: trzistekapitala@granolio.hr

MB: 1244272; OIB: 59064993527; IBAN HR6024020061100063532 Erste&Steiermarkische bank d.d. Rijeka, IBAN HR1423400091110416692 Privredna banka Zagreb, IBAN HR5123900011100014261 Hrvatska poštanska banka Zagreb; temeljni kapital: 19.016.430,00 kn uplaćen u cijelosti podijeljen na 1.901.643 redovnih dionica serije A nominalnog iznosa 10,00 kn; tvrtka je upisana u Trgovačkom sudu u Zagrebu, MBS: 080111595; predsjednik Uprave: Hrvoje Filipović, članovi Uprave: Vladimir Kalčić i Drago Šurina, predsjednik Nadzornog odbora: Franjo Filipović

Budmanijeva 5, HR-10000 Zagreb tel.: +385 | 6320 200; faks: +385 | 6320 222; e-mail: granolio@granolio.hr; http://www.granolio.hr

Zagreb, 30 October 2018

Statement of Executives responsible for preparing financial statements for the nine months period

Pursuant to the current Croatian Accounting Act (Official Gazzette 109/07), the Management Board is required to ensure that the financial statements of Granolio d.d. for each financial period are prepared in accordance with the International Financial Reporting Standards (IFRS), issued by the International Accounting Standards Board (IASB) and that they give a true and fair view of the financial position and results of the Company's operations in the given period.

To the best of our knowledge, the complete shorten set of unaudited financial statements for the nine months period give a true presentation of the Company's position as at 30 September 2018.

Reports prepared by:

Jasenka Kordić Accounting Director

MB: 1244272; OIB: 59064993527; IBAN HR6024020061100063532 Erste&Steiermarkische bank d.d. Rijeka, IBAN HR1423400091110416692 Privredna banka Zagreb, IBAN HR5123900011100014261 Hrvatska poštanska banka Zagreb; temeljni kapitaľ: 19.016.430,00 kn uplaćen u cijelosti podijeljen na 1.901.643 redovnih dionica serije A nominalnog iznosa 10,00 kn; tvrtka je upisana u Trgovačkom sudu u Zagrebu, MBS: 080111595; predsjednik Uprave: Hrvoje Filipović, članovi Uprave: Vladimir Kalčić i Drago Šurina, predsjednik Nadzornog odbora: Franjo Filipović