Grenergy Renovables S.A.

Audit Report / Information • Feb 27, 2020

Audit Report on Financial Statements issued by an Independent Auditor

GRENERGY RENOVABLES, S.A. AND SUBSIDIARIES Consolidated Financial Statements and Consolidated Management Report for the year ended December 31, 2019

AUDIT REPORT ON CONSOLIDATED FINANCIAL STATEMENTS ISSUED BY AN INDEPENDENT AUDITOR

Translation of a report and consolidated financial statements originally issued in Spanish. In the event of discrepancy, the Spanish-language version prevails (See Note 28)

To the shareholders of GRENERGY RENOVABLES, S.A.:

Audit report on the consolidated financial statements

Opinion

We have audited the consolidated financial statements of GRENERGY RENOVABLES, S.A. (the parent) and its subsidiaries (the Group), which comprise the consolidated balance sheet at December 31, 2019, the consolidated income statement, the consolidated statement of other comprehensive income, the consolidated statement of changes in equity, the consolidated cash flow statement, and the notes thereto, for the year then ended.

In our opinion, the accompanying consolidated financial statements give a true and fair view, in all material respects, of consolidated equity and the consolidated financial position of the Group at December 31, 2019 and of its financial performance and its consolidated cash flows, for the year then ended in accordance with International Financial Reporting Standards, as adopted by the European Union (IFRS-EU), and other provisions in the regulatory framework applicable in Spain.

Basis for opinion

We conducted our audit in accordance with prevailing audit regulations in Spain. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the consolidated financial statements section of our report.

We are independent of the Group in accordance with the ethical requirements, including those related to independence, that are relevant to our audit of the consolidated financial statements in Spain as required by prevailing audit regulations. In this regard, we have not provided non-audit services nor have any situations or circumstances arisen that might have compromised our mandatory independence in a manner prohibited by the aforementioned requirements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key audit matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the current period. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our audit opinion thereon, and we do not provide a separate opinion on these matters.

Acquisition of Parque Eólico Quillagua SpA

Description As described in Note 5 to the accompanying financial statements, on November 8, 2019, the Parent Company acquired all of the shares of Parque Eólico Quillagua, SpA for 7,010 million euros. This Company operates a 95 MW photovoltaic power plant in Chile.

The transaction falls within the scope of IFRS 3, "Business Combinations," and therefore, as explained in Note 5 to the accompanying consolidated financial statements, the identifiable assets acquired, and the liabilities assumed, must be recorded in the Group's consolidated financial statements at their fair value on the acquisition date. The Group has received assistance from independent experts to determine these values.

Given that recording this transaction requires that Group Management make certain judgments and assumptions and due to the significance of the related amounts, we determined this to be a key audit matter.

Our response Our audit procedures included the following:

• Analyzing the consideration established in the purchase agreement to verify that the cost of the business combination was correctly determined.
• Reviewing the acquired company's financial information substantiating its key balance sheet headings.
• Assessing the reasons for which business combinations were valued under favorable terms, by verifying the amount of the negative difference on consolidation, including the estimate of deferred taxes arising as a result of the provisional adjustment made by the Group.
• Evaluating Group Management's and its independent experts' analysis for determining the reasonable amount of the acquired net assets.
• Confirming the independence of the independent experts that assisted the Group.
• Reviewing the disclosures made in the notes to the consolidated financial statement comply with the applicable financial reporting framework.

Recognition of income from construction contracts

Description The Grenergy Group carries out a significant part of its business though contracts for the construction of Photovoltaic solar plants. The information on the recognition of revenue from these contracts is provided in Note 4.13 of the accompanying consolidated financial statements.

Since it affects the valuation of uncertified work carried out, which at December 31, 2019 amounts to 6,371 thousand euros, and that it likewise affects an exceedingly relevant amount of the total volume of consolidated revenue, requiring that Group Management make significant estimates related primarily to total costs, costs incurred, completion costs, and the expected profit or loss earned upon project completion, all of which fall within the scope of the criteria established in IFRS 15, "Revenue from Contracts with Customers," we determined this revenue recognition method to be a key audit matter.

Our response Our audit procedures included the following:

• Gaining an understanding of the process used to manage projects under construction, including evaluation of the design and implementation of the relevant controls.
• Choosing a selected sample of contracts, based on their significance, and verifying that their terms and conditions, as well as the invoiced income and related sales costs at year end, were recognized in the income statement in accordance with the input method (based on costs incurred in proportion to estimated total costs) over time, ensuring that costs are allocated at the correct amount and to the correct period, and checking against bank statements that invoiced amounts have been collected.
• Inquiring with Company Management about the development stage of the most relevant projects to ensure that there are no significant deviations between the projected and actual costs.
• Checking that the balances of uninvoiced completed construction recognized at December 31, 2019 from invoices issued after year-end have been billed correctly.
• Performing analytical testing on construction margins.
• Verifying against supporting documentation that 100% of completed construction was provisionally accepted.
• Reviewing the disclosures made in the notes to the consolidated financial statement comply with the applicable financial reporting framework.

Other information: consolidated management report

Other information refers exclusively to the 2019 consolidated management report, the preparation of which is the responsibility of the parent company's directors and is not an integral part of the consolidated financial statements.

Our audit opinion on the consolidated financial statements does not cover the consolidated management report. In conformity with prevailing audit regulations in Spain, our responsibility in terms of the consolidated management report is to assess and report on the consistency of the management report with the consolidated financial statements based on the knowledge of the Group we obtained while auditing the consolidated financial statements, and not including any information not obtained as evidence during the course of the audit. In addition, our responsibility is to assess and report on whether the content and presentation of the consolidated management report are in conformity with applicable regulations. If, based on the work carried out, we conclude that there are material misstatements, we are required to disclose them.

Based on the work performed, as described in the above paragraph, the information contained in the consolidated management report is consistent with that provided in the 2019 consolidated financial statements and their content and presentation are in conformity with applicable regulations.

Other matters

On April 3, 2019 other auditors issued their audit report on the 2018 consolidated financial statements, in which they expressed an unqualified opinion.

Responsibilities of the parent company´s directors and the audit committee for the consolidated financial statements

The directors of the parent company are responsible for the preparation of the accompanying consolidated financial statements so that they give a true and fair view of the equity, financial position and results of the Group, in accordance with IFRS-EU, and other provisions in the regulatory framework applicable to the Group in Spain, and for such internal control as they determine is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, the directors of the parent company are responsible for assessing the Group's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group or to cease operations, or has no realistic alternative but to do so.

The audit committee is responsible for overseeing the Group's financial reporting process.

Auditor's responsibilities for the audit of the consolidated financial statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion.

Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with prevailing audit regulations in Spain will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

As part of an audit in accordance with prevailing audit regulations in Spain, we exercise professional judgement and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group's internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
• Conclude on the appropriateness of the directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Group to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

We communicate with the audit committee of the parent company regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide the audit committee of the parent company with a statement that we have complied with relevant ethical requirements, including those related to independence, and to communicate with them all matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with the audit committee, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters.

We describe these matters in our auditor's report unless law or regulation precludes public disclosure about the matter.

Report on other legal and regulatory requirements

Additional report to the audit committee

The opinion expressed in this audit report is consistent with the additional report we issued to the audit committee on February 26, 2020.

Term of engagement

The ordinary general shareholders' meeting held on June 17, 2019 appointed us as auditors for three years, commencing on December 31, 2019.

ERNST & YOUNG, S.L. (Registered in the Official Register of Auditors under No. S0530)

(signed in the original version)

David Ruiz-Roso Moyano (Registered in the Official Register of Auditors under No. 18336)

___________________________

February 26, 2020

CONSOLIDATED ANNUAL ACCOUNTS AND MANAGEMENT REPORT CORRESPONDING TO THE YEAR ENDED AT DECEMBER 31, 2019

Translation of a report issued in Spanish. In the event of a discrepancy, the Spanish language version prevails.

CONSOLIDATED STATEMENT OF FINANCIAL POSITION AT DECEMBER 31, 2019 AND DECEMBER 31, 2018

(Euros)

ASSETS	Notes	12.31.2019	12.31.2018 (*)	EQUITY AND LIABILITIES Notes		12.31.2019	12.31.2018 (*)
NON-CURRENT ASSETS		88,044,141	18,715,488 EQUITY			37,097,475	25,310,682
Intangible assets	Note 7	9,445,907		2,697,418 CAPITAL AND RESERVES		37,247,581	25,539,372
Software		70,720		3,093 Share capital	Note 13.1	8,507,177	3,645,933
Patents, licenses, and trademarks		9,375,187		2,694,325 Issued capital		8,507,177	3,645,933
				Share premium	Note 13.2	6,117,703	6,117,703
Property, plant, and equipment	Note 6	70,346,859	14,774,624 Reserves		Note 13.3	15,444,869	8,373,059
Plant and other PP&E items		1,271,860		609,331 (Shares and participation units of the Parent)	Note 13.4	(3,328,497)	(2,062,970)
PP&E under construction and prepayments		69,074,999		14,165,293 Profit for the year attributable to the Parent	Note 21	11,436,955	9,725,962
				Valuation adjustment	Note 14	(930,626)	(260,315)
Right-of-use assets	Note 8.1	4,564,434		182,641 Hedging transactions		(477,733)	-
				Exchange profit/(loss)		(452,893)	(260,315)
Investments in group companies and associates	Note 9.1	-		11,474 Minority interests	Note 15	(150,106)	(228,690)
Equity instruments		-	11,474
				NON-CURRENT LIABILITIES		73,437,618	9,734,836
Financial investments	Note 9.2	188,991		92,737 Non-current provisions	Note 16	2,748,384	-
Non-current financial assets		102,067		- Borrowings	Note 17	67,239,122	9,734,836
Other financial assets		86,924		92,737 Bonds and other marketable securities		21,539,686	-
				Bank borrowings		41,764,740	9,333,447
Deferred tax assets	Note 20	3,497,950		956,594 Finance lease liabilities		3,726,447	134,854
Deferred tax assets		3,497,950		956,594 Other financial liabilities		208,249	266,535
				Deferred tax liabilities	Note 20	3,450,112	-
CURRENT ASSETS		69,582,869		41,856,191 CURRENT LIABILITIES		47,091,917	25,526,161
Inventories	Note 10	8,851,116		11,624,696 Current provisions	Note 16	828,909	64,150
Raw materials and other consumables		1,015,452	1,115,309
Plant in progress		7,777,484		10,479,885 Borrowings	Note 17	9,642,204	7,333,584
Prepayments to suppliers		58,180		29,502 Bank borrowings		4,953,157	6,061,848
Trade and other receivables		24,762,622		14,596,075 Finance lease liabilities		692,217	27,662
Trade receivables for sales and services	Note 11	12,419,040		12,484,921 Derivatives		654,429	-
Other receivables		160,220		11,817 Other financial liabilities		3,342,401	1,244,074
Receivables from employees		20,290	7,486
Current tax assets	Note 20	16,112		- Payables to group companies and associates	Note 18 and 24.1	-	333,769
Other receivables from public administrations	Note 20	12,146,960	2,091,851
Investments in group companies and associates		40,512		45,830 Trade and other payables		36,620,804	17,763,282
Loans to group companies and associates	Note 9.1 and 24.1	40,512		45,830 Suppliers		23,388,491	10,662,365
Financial investments	Note 9.2	6,873,062		2,360,303 Suppliers, group companies, and associates	Note 22.1	5,436	27,759
Loans to companies		-		2,236,465 Other payables		1,938,348	466,153
Other financial assets		6,873,062		123,838 Employee benefits payable		536,097	467,792
Accruals		282,470		110,246 Current income tax liabilities	Note 20	730,798	-
Cash and cash equivalents	Note 12	28,773,087		13,119,041 Other payables to public administrations	Note 20	1,370,551	299,458
Cash		28,773,087		13,119,041 Clients prepayments	Note 11	8,651,083	5,839,755
				Accruals		-	31,376
TOTAL ASSETS		157,627,010		60,571,679 TOTAL EQUITY AND LIABILITIES		157,627,010	60,571,679

(*) Restated figures (Note 2.4)

The accompanying Notes 1 to 28 and the Appendixes are an integral part of the consolidated statement of financial position at December 31, 2019 and 2018.

CONSOLIDATED INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31, 2019 AND DECEMBER

31, 2018 (Euros)

	Notes	12.31.2019	12.31.2018 (•)
CONTINUING OPERATIONS
Revenue	Note 26	72,289,630	26,577,205
Sales revenue		70,931,791	25,567,266
Revenue from services rendered		1,357,839	1,009,939
Changes in inventories of finished goods and work in progress		(2,702,401)	1,009,770
Work performed by the entity and capitalized	Note 19	12,239,733	8,190,763
Cost of sales	Note 21	(62,588,351)	(22,061,075)
Consumption of raw materials and other consumables		(62,574,844)	(21,703,217)
Subcontracted work		(13,507)	(357,858)
Other operating income		51,772	68,885
Ancillary income and other operating income		51,772	68,885
Employee benefits expense		(4,784,016)	(3,152,305)
Wages, salaries, et al		(4,011,197)	(2,726,285)
Social security costs	Note 21	(772,819)	(426,020)
Other operating expenses		(4,846,025)	(3,617,168)
External services Taxes other than income tax	Note 21	(4,028,078) (53,188)	(3,399,488) (28,137)
Losses on, impairment of, and changes in trade provisions	Note 16	(764,759)	(142,930)
Other current management expenses		-	(46,613)
Depreciation and amortization	Note 6 & 7	(660,945)	(881,431)
Impairment losses and gains (losses) on disposal of non-current assets	Note 6	(290,804)	9,357,919
Impairment and losses		(291,320)	(2,174,486)
Gains (losses) on disposals		516	11,532,405
Gains (losses) due to loss of control over consolidated interests		19,747	(84,433)
Other gains (losses)	Note 5	8,790,226	-
OPERATING PROFIT		17,518,566	15,408,130
Finance income	Note 21	55,019	-
Finance costs	Note 21	(1,141,769)	(1,559,392)
Third-party borrowings		(1,141,769)	(1,559,392)
Currency translation differences	Note 21	(2,307,056)	(2,798,088)
Impairment and gains or losses on disposal of financial instruments	Note 21	(25,000)	(122,714)
Impairment losses		(25,000)	(122,714)
FINANCE COST		(3,418,806)	(4,480,194)
PROFIT BEFORE TAX		14,099,760	10,927,936
Income tax	Note 20	(2,663,443)	(1,395,478)
CONSOLIDATED PROFIT FOR THE YEAR		11,436,317	9,532,458
PROFIT (LOSS) ATTRIBUTABLE TO MINORITY INTERESTS		(638)	(193,504)
PROFIT (LOSS) FOR THE PERIOD ATTRIBUTABLE TO THE PARENT		11,436,955	9,725,962
Earnings (losses) per share	Note 13.6	0.48	0.41

(*) Restated figures (Note 2.4)

The accompanying Notes 1 to 28 and the Appendixes are an integral part of the consolidated statement of income statement at December 31, 2019 and 2018.

CONSOLIDATED STATEMENT OF CHANGES FOR THE YEAR ENDED DECEMBER 31, 2019 AND DECEMBER 31, 2018

A) CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

(Euros)

	12.31.2019	12.31.2018(*)
CONSOLIDATED PROFIT (LOSS) FOR THE PERIOD (I)	11,436,317	9,532,458
Income and expense recognized directly in equity - Currency translation differences - Other - Tax effect	(18,476) (477,733) -	(319,917) - -
TOTAL INCOME AND EXPENSE RECOGNIZED DIRECTLY IN CONSOLIDATED EQUITY (II)	(496,209)	(319,917)
Amounts transferred to consolidated income statement - Currency translation differences - Tax effect	- 1,492	- 4,696
TOTAL AMOUNTS TRANSFERRED TO CONSOLIDATED INCOME STATEMENT (III)	1,492	4,696
TOTAL CONSOLIDATED COMPREHENSIVE INCOME FOR THE PERIOD (1+11+111)	10,941,600	9,217,237
Attributable to: Parent Minority interests	10,942,238 (638)	9,410,740 (193,503)

(*) Restated figures (Note 2.4)

The accompanying Notes 1 to 28 and the Appendixes are an integral part of the consolidated statement of comprehensive income at December 31, 2019 and 2018.

B) CONSOLIDATED STATEMENT ALL CHANGES IN EQUITY (Euros)

	Share capital	Share premium	Reserves	(Parent company shares)	Profit for the period attributable to the Parent Company	Valuation adjustment	Minority interests	Total
BALANCE AT DECEMBER 31, 2017	3,645,933	6,117,703	3,823,537	(1,133,498)	3,512,835	54,906	21,178	16,042,594
Adjustments for charges in criteria and misstatements	-	-	-	-	-	-	-	-
ADJUSTED OPENING BALANCE 2018	3,645,933	6,117,703	3,823,537	(1,133,498)	3,512,835	54,906	21,178	16,042,594
Total consolidated comprehensive income	-	-	-	-	13,279,402	(315,221)	(193,503)	12,770,678
Transactions with shares of the Parent (net)	-	-	800,410	(929,472)	-	-	-	(129,062)
Increase (reduction) in equity arising from a business
combination	-	-	-	-	-	-	(6,577)	(6,577)
Other changes in equity	-	-	3,749,112	-	(3,512,835)	-	(49,788)	186,489
BALANCE AT DECEMBER 31, 2018	3,645,933	6,117,703	8,373,059	(2,062,970)	13,279,402	(260,315)	(228,690)	28,864,122
Adjustments for charges in criteria and misstatements
(Note 2.4)	-	-	-	-	(3,553,440)	-	-	(3,553,440)
ADJUSTED OPENING BALANCE 2019	3,645,933	6,117,703	8,373,059	(2,062,970)	9,725,962	(260,315)	(228,690)	25,310,682
Total consolidated comprehensive income	-	-	-	-	11,436,955	(494,717)	(638)	10,941,600
Capital increase	4,861,244		- (4,861,244)	-	-	-	-	-
Transactions with shares of the Parent (net)	-	-	2,110,720	(1,265,527)	-	-	-	845,193
Increase (reduction) in equity arising from a business
combination	-	-	96,372	-	-	(175,594)	79,222	-
Other changes in equity	-	-	9,725,962	-	(9,725,962)		-	-
BALANCE AT DECEMBER 31, 2019	8,507,177	6,117,703	15,444,869	(3,328,497)	11,436,955	(930,626)	(150,106)	37,097,475

The accompanying Notes 1 to 28 and the Appendixes are an integral part of the consolidated statement of changes in equity at December 31, 2019 and 2018

CONSOLIDATED CASH FLOW STATEMENT OF CORRESPONDING TO THE YEAR ENDED DECEMBER 31, 2019 AND DECEMBER 31, 2018

(Euros)

	Notes	12.31.2019	12.31.2018(*)
A) CASH FLOWS FROM OPERATING ACTIVITIES
1. Profit before tax		14,099,760	10,927,936
2. Adjustments to profit		(3,654,912)	(3,789,215)
a) Depreciation and amortization (+)	6 and 7	660,945	881,431
b) Valuation allowances for impairment losses (+/-).		291,320	2,317,416
c) Changes in provisions (+/-)		764,759	64,150
e) Gains (losses) from derecognition and disposal of non-current assets (+/-)	6 and 7	(516)	(11,532,405)
f) Proceeds from disposals of financial instruments (+/-)			-
g) Finance income (-)		(55,019)	-
h) Finance expenses (+)	21	1,141,769	1,559,392
i) Currency translation differences (+/-)	21	2,307,056	2,798,088
j) Change in fair value of financial instruments (+/-).		25,000	122,713
k) Other income and expenses (-/+)	5	(8,790,226)	-
3. Changes in working capital.		9,177,718	6,610,882
a) Inventories (+/-)	10	2,773,580	1,795,999
b) Trade and other receivables (+/-)	11	(10,166,547)	6,140,435
c) Other current assets (+/-)		(166,906)	(19,002)
d) Trade and other payables (+/-)		14,009,109	1,545,284
e) Other current liabilities (+/-)		(31,376)	(2,851,834)
f) Other non-current assets and liabilities (+/-).		2,759,858	-
4. Other cash flows from operating activities		(3,740,961)	(4,057,308)
a) Interest paid (-)	21	(1,141,769)	(1,559,392)
c) Interest received (+)		55,019	-
d) Income tax receipts (payments) (+/-)	21	(2,654,211)	(2,497,916)
5. Cash flows from operating activities (+/-1+/-2+/-3+/-4)		15,881,605	9,692,295
B) CASH FLOWS FROM INVESTING ACTIVITIES
6. Payments on investments (-)		(56,081,472)	(29,349,117)
a) Group companies, net of cash in consolidated companies	5	(4,862,103)	(48,162)
b) Intangible assets	7	(81,501)	-
c) Property, plant and equipment	6	(46,503,855)	(26,926,181)
e) Other financial assets		(4,634,013)	(2,374,774)
7. Proceeds from disposals (+)		-	37,135,820
a) Group companies, net of cash in consolidated companies		-	23,009
c) Property, plant and equipment	6	-	37,075,606
e) Other financial assets	8.2	-	37,205
8. Cash flows from/(used in) investing activities (7+6)		(56,081,472)	7,786,703
C) CASH FLOWS FROM FINANCING ACTIVITIES
9. Proceeds from and payments on equity instruments		845,192	50,850
c) Acquisition of equity instruments of the Parent (-)	13	(3,882,063)	(1,869,232)
c) Disposal of equity instruments of the Parent	13	4,727,255	1,920,082
10. Proceeds from and payments of financial liabilities		55,039,454	(7,200,433)
a) Issues (+)		59,014,369	34,741,508
1. Bonds and other marketable securities (+).		21,539,686	-
2. Bank borrowings (+).	17.1	34,949,805	34,741,508
4. Other borrowings (+).	17.2	2,524,878	-
b) Repayment and amortization of:		(3,974,915)	(41,941,941)
2. Bank borrowings (-)		(3,916,629)	(41,941,941)
4. Other borrowings (-).		(58,286)	-
12. Cash flows from financing activities (+1-9+/-10-11)		55,884,646	(7,149,583)
D) Effect of changes in exchange rates		(30,733)	(163,789)
E) NET INCREASE / (DECREASE) IN CASH AND CASH EQUIVALENTS
(+/-A+/-B+/-C+/- D)		15,654,046	10,165,626
Cash and cash equivalents at beginning of period	12	13,119,041	2,953,415
Cash and cash equivalents at end of year	12	28,773,087	13,119,041

(*) Restated figures (Note 2.4)

The accompanying Notes 1 to 28 and the Appendixes are an integral part of the consolidated statement of cash flow statement at December 31, 2019 and 2018

NOTES TO THE YEAR ENDED CONSOLIDATED FINANCIAL STATEMENTS AT DECEMBER 31, 2019

1. Group companies

1.1 Parent

GRENERGY RENOVABLES, S.A. ("the Parent") was incorporated in Madrid on July 2, 2007 via public deed, as filed at the Mercantile Register of Madrid in Tome 24.430, Book 0, Folio 112, Section 8, Page M-439.423, 1st inscription. On November 15, 2019 the parent company changed its registered and fiscal office to Rafael Botí, nº 26, Madrid.

The corporate purpose of the Parent and the sectors in which the Grenergy Group performs its activities are as follows: the promotion and commercialization of renewable energy installations, production of electric energy as well as any complementary activities, and management and operation of such renewable energy installations.

At December 31, 2019 the Grenergy Renovables Group is comprised of 111 companies, including the Parent (100 subsidiaries held directly by the Parent and 10 held indirectly via majority shareholdings of a subsidiary). The subsidiaries were consolidated using the full consolidation method. In each of the countries in which the Group operates, its Parent conducts the outsourcing functions arranged under EPC (Engineering, Procurement and Construction), O&M (Operation and Maintenance), and asset-management contracts using company personnel. The remainder of subsidiaries are considered Special Purpose Vehicles (SPVs) where each of the solar plants or wind farms are located. At 2019, total of 82 subsidiaries were inactive.

The shares of the Parent, Grenergy Renovables, S.A., have been listed on the Spanish Alternative Stock Market for Expanding Companies ("MAB-EE") since July 8, 2015. As a consequence of being listed on the MAB-EE, the Parent lost its status as a sole shareholder company, which had been declared during 2014. On November 15, 2019, authorization was given by the shareholders in general meeting to request exclusion from negotiations of their shares on Spain's Alternative Stock Market, while also soliciting their admission to trading of the shares on the Barcelona, Bilbao, Madrid, and Valencia exchanges, as well as inclusion on the Electronic Trading Platform, among other decisions made. As a result, the Board of Directors of Administración de Bolsas y Mercados Españoles, Sistemas de Negociación, S.A. agreed to exclude the 24,306,221 shares from the above market effective December 16, 2019, the same date upon which the shares were admitted for trading on the Barcelona, Bilbao, Madrid, and Valencia exchanges (Note 13).

On March 29, 2019 the Board of Directors of the Parent authorized the Group's annual consolidated financial statements for the year ended December 31, 2018, prepared in accordance with Spanish GAAP and the Standards for the Preparation of Consolidated Financial Statements. Said financial statements were approved by the shareholders in general meeting on June 17, 2019. At that date, the Board of Directors was delegated with the capacity to initiate the steps for requesting admission of the Parent's shares on the Madrid, Barcelona, Bilbao, and/or Valencia stock exchanges. Thus, and in compliance with the Spanish Securities Market Act, the Board decided to apply the International Financial Reporting Standards adopted by the EU ("IFRS-EU") for the first time. On July 23, 2019 the Board of Directors of the Parent authorized the special purpose consolidated financial statements prepared under IFRS-EU for the years 2018, 2017, and 2016.

The Parent is in turn a member of the Daruan Group, the parent of which is Daruan Group Holding, S.L., a company resident in Spain which prepares and publishes the annual consolidated financial statements.

The Daruan Group's annual consolidated financial statements corresponding to the year ended December 31, 2018, as well as the related management and audit reports, were filed at the Madrid Mercantile Register on July 29, 2019.

1.2 Subsidiaries

Subsidiaries included in the consolidation scope and the information on these are presented in Appendix I. of the accompanying financial statements.

The financial statements of the subsidiaries are consolidated with those of the Parent by applying the full consolidation method, thereby eliminating all balances and transactions between consolidated companies during the consolidation process.

The results of subsidiaries acquired or sold during the year are recognized in the consolidated income statement from the effective acquisition or disposal date, as appropriate. Interests owned by third parties in Group equity and third parties' share in profit or loss for the year are recorded under "Minority interests" in the consolidated statement of financial position and consolidated income statement, respectively.

The separate financial statements of the Parent and the subsidiaries used for the preparation of the accompanying consolidated financial statements all refer to the same reporting period.

There are no other companies other than those indicated above which, in accordance with prevailing regulations, form a part of said Group. None of the subsidiaries issued any shares listed on a stock exchange.

1.3 Regulatory framework

Regulation of the sector in Spain

The renewable energies sector is a regulated sector which saw fundamental changes in recent years, receiving a new regulatory framework in 2013. Within said framework, the main legislative reference is Act 24/2013, of December 26, on the Electricity Sector, which repealed Act 54/1997 of November 27, on the Electricity Sector.

The new Sector Act (Law 24/2013), published on December 26, 2013, ratified the provisions of Royal Decree-Law 9/2013, eliminating the so-called special regime and proposing a new remuneration regime for facilities that generate power from renewable sources, cogeneration, and waste. The new remuneration regime (known as specific remuneration, to be applied to the new installations exceptionally) is additional to the revenue obtained from the sale of energy in the market and is composed of a term per unit of installed capacity to cover, where applicable, the investment costs which cannot be recovered in the market, and a term for the operation to cover, where applicable, the difference between the operating costs and the market price.

This new specific remuneration is calculated based on a standard installation over the length of its useful regulatory life in the context of the activity performed by an efficient and wellmanaged company, as per the following:

• standard revenues from the sale of energy valued at the market price;
• standard operating costs; and
• the standard value of the original investment.

This remuneration regime is underpinned by a "reasonable return" on investment which is defined as the yield on the 10-year sovereign bond plus a spread (which has initially been set at 300 basis points).

The new regime establishes regulatory periods of six years and sub-periods of three years. Every three years there is scope for changing the remuneration parameters related to market price forecasts, factoring in any deviations that may have arisen during the sub-period.

Every six years the standard parameters for installations can be modified, except for the amount of initial investment and the regulatory useful lives, which remain unchanged throughout the life of the installations. Likewise, every six years the interest rate for remuneration can be changed, but only with respect to future remuneration.

The value of the standard investment for the new installations is determined via a competitive procedure.

This new remuneration is applicable from July 2013, the date on which Royal Decree Law 9/2013 entered into force.

On June 6, 2014, Royal Decree Law 413/2014 was published, regulating the production of electric energy from renewable energy sources, cogeneration, and waste. Subsequently, on June 16, 2014, Order IET/1045/2014, of the Ministry for Industry, Energy, and Tourism, was published, approving the remuneration parameters of standard facilities applicable to certain installations that produce electricity from renewable sources, cogeneration, and waste. In accordance with this new regulation, in addition to the revenue obtained from the sale of energy valued at market prices, the installations will receive specific remuneration during their regulatory life composed of a term per unit of installed capacity to cover, where applicable, the investment costs of each standard facility which cannot be recovered by the sale of energy in the market, known as investment remuneration, and a term for the operation to cover, where applicable, the difference between operating costs and revenue from participating in the market for production of a standard facility, known as operational remuneration.

It is worth highlighting that at December 31, 2019 the Group does not own any assets in Spain which could be classified as a renewable energy plant or installation whose remuneration is determined by the aforementioned regulatory framework.

The parent company has focused its efforts on carrying out new developments and building new facilities in Latin America, through the subsidiaries.

On 23 November 2019, Royal Decree-Law 17/2019 of 22 November 2019 was published, adopting urgent measures for the necessary adaptation of remuneration parameters affecting the electricity system and responding to the process for the discontinuance of activities in thermal power plants. The main aspects of this Royal Decree-Law are described below:

• It establishes the reasonable return for renewables, cogeneration and waste and the financial yield for production in non-mainland territories for the period 2020-2025. The relevant rate is updated to 7.09%, compared with 7.398% or 7.503% depending on the type of facility.
• It provides that the Government will approve, by 29 February 2020, the remaining remuneration parameters that will be applicable between 2020 and 2025, which previously required the definition of reasonable return provided for in the law.
• It incorporates a mechanism that will be available to facilities that were eligible for prioritised remuneration when Royal Decree-Law 9/2013 came into force: it gives operators the option of maintaining a reasonable return on their facilities of 7.398% until 2031. This measure will not apply where there is a right to receive compensation as a result of a final judgment or arbitration award, or when ongoing arbitral or judicial proceedings are still in progress, unless the waiver of the right to receive such compensation or of the continuation or resumption of such proceedings can be duly attested to. In addition, facilities that so wish may waive the remuneration framework regulated by this Royal Decree-Law and avail themselves of the ordinary framework, subject to review every six years.

At December 31, 2019, the Group did not have any wind farms in operation.

Sector regulation in Latin America

With respect to the regulatory framework in Latin America which will affect operations of the Grenergy Group in Chile, Peru, Mexico, Colombia, and Argentina in the short and medium term, it is worth highlighting that above all else the energy market is a private market without any support in the form of public premiums or subsidies for renewable energies as was the case in Spain some years ago. Thus, there is no regulatory or legal uncertainty with respect to investments in photovoltaic installations or wind farms.

Chile

Until now the Group has operated in Chile via photovoltaic installations operated under the regime for small power producers ("SPP"). The SPPs comprise all those means of generation with excess capacity less than or equal to 9 MW, connected via medium voltage networks in the distribution systems. These types of projects make up the short term Grenergy project portfolio in Chile.

The main difference in the commercialization of energy between an SPP and other producers consists in sales made at a stabilized price. This stabilized price is offered by the distributing company to the which the producer sells. This price is in turn set by the National Energy Commission every six months. It is based on the forecast made for marginal costs over the following 48 months for each base price. As it corresponds to an average performance of marginal costs over the next four years and 24 hours a day, this price does not change significantly, remaining stable in comparison with spot prices.

In addition, all producing companies can sign contracts with their clients at freely agreed-upon prices (non-regulated clients) and with the transmission/distribution companies at the base price, determined by the National Energy Commission as explained above. Another type of commercialization of generated energy is via a regulated process for supply tenders involving distributor companies. The distributor companies in turn sell their energy to final regulated clients or to unregulated clients who do not wish to freely agree upon supply contracts with producer companies.

The producing companies must notify the CDEC six months in advance with respect to the option of selling energy they will choose (at the base price or stabilized price). In order to change the option, advance notice of 12 months must be provided, with the minimum term for each option corresponding to four years.

Nonetheless, regulatory changes are currently afoot in the SPP segment which will affect product remuneration schemes (stabilized price), as well as red tape and procedures. Behind the scenes of this change, certain participants consider this stabilized price as tantamount to a cross-subsidy which is no longer necessary to foster the installation of new renewable capacity.

Amendments approved by the Ministry of Energy (Regulations for small-scale generation measures) establish a transitional regime for projects already under the current remuneration scheme, as well as those in late stages of progress. Projects already under operation may continue to receive the current stable price for a period of up to 14 years commencing the entry into force of the newer regulations, which is also applicable to projects in their final stages of development. To be eligible, the projects must be granted connection permission, or present the environmental paperwork within a period of 7 months, while also having obtained the construction declaration prior to 18 months of the entry into force of the new standards. Should the above conditions not be met, new projects will continue at the stable price, although based on a different calculation method, linked to the timeframe during which each sells its energy. The abovementioned amendment is pending approval by the Office of the Comptroller General of the Republic of Chile, and thereby could undergo changes.

Peru

The electricity sector in Peru is regulated by the Electricity Concession Law, in accordance with Decree Law No. 25844, Supreme Decree No. 009-93-EM and its modifications and extensions. In accordance with this law, the electric energy sector in Peru is divided into three principal segments: generation, transmission, and distribution. Since October 2000, the Peruvian electricity system has been comprised of the National Interconnected Electricity System ("SEIN" in its Spanish acronym) as well as other connecting systems. The Group supplies renewable electric energy in the segment which belongs to SEIN based on Law No. 28832 of 2006, which ensures the efficient generation of electric energy, introducing important changes in the regulation of the sector.

In accordance with the Electricity Concession Law, the operation of energy generation installations and transmission systems is subject to the regulations of the National Committee for Economic Operations - ("COES-SEIN") so as to coordinate operations at a minimum cost, ensuring the secure supply of electricity, as well as the best use of energy resources.

The COES-SEIN regulates electric energy prices and transmission prices between energy producers, as well as the consideration for owners of the transmission systems.

To foster installation of renewable energy, the Peruvian government has on several occasions held public tenders in which it offered long-term contracts (20 years) with energy prices set at a fixed rate.

During August 2019, the Peruvian government published a new regulation acknowledging fixed capacity, i.e., granting wind power projects the maximum power generated by a generation unit with a high level of security. This is a relevant step forward, considering that generation projects must deliver fixed amounts of energy once a supply contract has been signed. Peru's government is working to publish a regulation which also makes it possible to recognize solar energy as fixed power.

Colombia

Colombia liberated its electricity sector in 1995 thanks to its Electricity Public Service Act and Electricity Law (both during 1994). Regulation of this market was implemented by the Energy and Gas Regulation Commission. It enacted the basic rules and launched this new approach in July, 1995. The sector separates its activities into the following segments: generation, transmission, distribution, and sales.

Energy purchase-sale transactions between generators and sellers takes place on the wholesale market as defined under Article 11 of Law 143 of 1994, in the following terms: "It is the market in which generators and sellers buy and sell energy and power on the national inter-connected system".

Considering the system's huge proportion of hydraulic generation, as well as the existence of different climatological phenomena in the country which seriously affect the availability of hydraulic resources, the "reliability charge" was created: plants receive an additional amount for their fixed power, which is that which will likely be distributed during a drought year, in which the system guarantees there will be installed capacity to generate the country's demand when necessary. Renewable plants are entitled to receive this additional income for this or part of their annual energy output.

To foster the presence of renewable energy there, the Colombian government has held renewable energy tenders. Long-term contracts at set prices are offered during these bidding processes (listed at the price index) signed with sellers. To boost sellers' interest, the government expects that 10% of energy supplied to regulated users originate from unconventional renewable energy sources.

Argentina

Argentina's energy sector has undergone three differentiated stages which have impacted its current system. Until 1992, the scheme was based on a centralized market under heavy government control. That year, Law 24,065 went into effect, establishing the bases for creating the following: ENTRE (the National Electricity Regulatory Board), the MEM administration (Wholesale Electricity Market), setting prices on the spot wholesaler market, determining tariffs for regulated businesses, as well as evaluating assets to be privatized.

In 2002, subsequent to the country's financial crisis, the Emergency Law was approved, freezing tariffs (among other measures). This led to a situation in which incentive to invest was strongly dissuaded, with nearly all new generation and transportation projects taken over by the government. However, generation activity continues to be dominated by private-sector participants and is still liberated.

Against a backdrop of energy demand arising due to low private investment, as well as the intention to take advantage of the country's natural resources while also reducing dependence on energy from abroad, new regulations were established declaring electricity production from renewable energy projects of national interest. Specifically, Law 27,191 was approved in 2015, imposed on users consuming 8% of their energy from the above sources in 2017, and up to 20% in 2025. The need for public tenders (under the auspices of the RenovAr plan) was established within the framework of this regulation (the most representative being Law 27,191).

In these tender processes, projects obtain 20-year energy sale PPAs. CAMMESA, the counterparty, is the non-profit entity which oversees the Argentine market; although the contracts are backed by a specific fund created by the Ministry of Energy and Mining, and reports to the World Bank should any claims arise. Apart from the government-backed agreement, RenovAr also offers tax breaks to attract private investment.

2. Basis of preparation

2.1 True and fair view

The consolidated financial statements and corresponding notes at 2018 were prepared in accordance with the International Financial Reporting Standards (IFRS), IAS 34, adopted for application in the European Union (IFRS-EU), approved by the European Commission and in force at December 31, 2018. In this regard, and in accordance with IFRS 1: "First-time adoption of international financial reporting standards," the first-time application of application of International Financial Reporting Standards (IFRS) was 2016, with January 1, 2016 established as the transition date, with no adjustments or reclassifications made to the annual financial statements under the General Chart of Accounts.

Grenergy's annual 2019 consolidated financial statements were prepared based on the accounting records of Grenergy Renovables, S.A. and remaining entities comprising the Group, in accordance with International Financial Reporting Standards ("IFRS") as adopted by the European Union, in conformity with Regulation (EC) 1606/2002 of the European Parliament and Council.

The annual consolidated financial statements were prepared using the historical cost approach, which were modified by the fair value recognition criteria applied to derivative financial instruments and business combinations.

The preparation of the consolidated financial statements and corresponding notes thereto in accordance with IFRS-EU requires making certain significant accounting estimates. It also requires management to exercise its judgment in the process of applying the Group's accounting policies. The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant.

The directors of the Group prepared the consolidated financial statements based on the principle of going concern.

These consolidated financial statements give a true and fair view of Grenergy's consolidated equity and financial position at December 31, 2019, and the consolidated results of its operations, changes in consolidated equity and consolidated cash flow for the year then ended.

The consolidated financial statements are presented in euros, unless indicated otherwise.

2.2 Adoption of International Financial Reporting Standards (IFRS)

a) New standards, modifications, and interpretations of mandatory application for the year

As a consequence of their approval, publication, and entry into force on January 1, 2019, the following standards, interpretations, and modifications adopted by the European Union were applied:

Approved for use in the European Union		Mandatory application for annual periods beginning on or after:
IFRS 16 - Leases	A new standard which replaces IAS 17	January 1, 2019
IFRS 9 (Amendment) - Prepayment Features with Negative Compensation	Permits recognition at amortized cost of certain financial instruments with prepayments	January 1, 2019
IFRIC 23 Uncertainty over Income Tax Treatments	Clarifies recognition and measurement as established in IAS 12 when it is uncertain whether tax authorities will accept a certain tax accounting treatment utilized by the entity	January 1, 2019
IAS 19 (Amendment) - Plan Amendment, Curtailment or Settlement	These modifications require an entity to use updated actuarial assumptions to determine the service costs for the current period as well as net interest for the remainder of the period	January 1, 2019
IAS 28 (Amendment) - Long-term Interests in Associates and Joint Ventures	The amendments clarify application of IFRS 9 to non current interest in an associate or business combination if the equity method is not applied to them	January 1, 2019
Annual Improvements to IFRSs - 2015- 2017 Cycle	Minor amendments to various standards	January 1, 2019

When applying these standards, interpretations and amendments, the only one with a significant impact on the interim financial statements is IFRS 16.

IFRS 16

IFRS 16 - "Leases" supersedes IAS 17, IFRIC 4, SIC-15 and SIC-27. It establishes the principles for accounting treatment of leases using a single balance sheet model for all leases. IFRS 16 took effect on January 1, 2019 and has not been adopted early.

Under IFRS 16 lessees must recognize a financial liability at the present value of the payments due for the remaining term of the lease agreement and a right-of-use asset for the underlying leased asset (by reference to the amount of the associated liability plus any direct upfront costs incurred) in their consolidated statements of financial position.

In addition, IFRS 16 changes how lease expenses are recognized: they are apportioned between the asset depreciation/amortization charges and a finance charge related to the effect of discounting the lease liability to present value. Lessor accounting treatment does not change significantly: they will continue to classify their leases as operating or finance leases depending on the extent to which the risks and rewards of ownership are transferred.

Grenergy has applied the following policies, estimates, and criteria:

• It has applied the recognition exemption provided for leases of low-value assets (less than 5,000 US dollars) and short-term leases (leases of 12 months or less).

• It has applied the practical expedient provided for in Paragraph C3 of Appendix C of IFRS 16, which states that it is not necessary to reassess whether a contract is, or contains, a lease at the date of initial application.

• It opted not to separate the non-lease components from lease components for those classes of underlying assets for which the relative importance of these components is not material with respect to the total value of the lease.
• For purposes of the transition, it elected to apply the modified retrospective approach, based upon which it did not have to restate any prior-year figures.
• It applied an incremental effective interest rate for financing homogeneous portfolios in terms of leases, countries, and lease duration. The weighted average incremental interest rate at the date of initial application was 2.15% in Spain, 1.8% in Chile, 6% in Argentina and 6,14% in Peru.
• To determine the lease terms and the non-cancelable periods Grenergy used the initial term of each contract except where it has the unilateral option of extending or terminating the contract and it is reasonably certain that it will exercise that option, in which case the corresponding extension or early termination terms are factored in.

Effect of applying IFRS 16

- The effect of applying IFRS 16 on the consolidated statement of financial position at January 1, 2019:

• a) Recognition of new assets under "Right-of-use assets" (non-current) in the amount of 1,271 thousand euros and new financial liabilities under "Finance lease liabilities," both non-current and current, in the amount of 1,166 thousand euros and 105 thousand euros, respectively, corresponding to the offices leased in Chile.
• b) With respect to the finance leases prior to the date of first-time adoption, corresponding to lease agreements for vehicles, their accounting does not change as compared to IAS 17; however, the carrying amount of 183 thousand euros for finance leases was reclassified from "Property, plant, and equipment" to "Right-of-use assets."

In sum, the impact of applying IFRS 16 to the consolidated statement of financial position at January 1, 2019 is as follows:

	Thousands of euros
Property, plant, and equipment	(183)
Right-of-use assets	1,582
NON-CURRENT ASSETS	1,399
Finance lease liabilities	1,227
NON-CURRENT LIABILITIES	1,227
Finance lease liabilities	172
CURRENT LIABILITIES	172

The reconciliation of the operating lease commitments disclosed in the "Operating leases - Lessee" section of Note 7.2 to the special purpose consolidated financial statements prepared under IFRS-EU for the year ended December 31, 2018 and the liabilities recognized at January 1, 2019 in the initial application of IFRS 16 is as follows:

	Thousands of euros
Operating lease commitments at December 31, 2018	3,391
Discounted using the corresponding interest rate	(148)
Current and low-value leases and others excluded from the IFRS 16 scope	(1,844)
Lease liabilities recognized at January 1, 2019	1,399

From the analysis performed under the scope of IFRS 16, the following were excluded (among others): the portion of the contract leasing the land to the Kosten (Argentina) wind farm, since the lease installments commencing 2020 are fully dependent on the variability of the energy produced (0.8% per year of the energy sold) and, therefore, are not included in the capitalisation model but will be recognised in the consolidated income statement, since these flows cannot be reliably estimated and, therefore, the lease of the Kosten wind farm in phase 2 would not be within the scope of IFRS 16.

- The effect of applying IFRS 16 on the interim consolidated income statement at December 31, 2019:

The application of IFRS 16 resulted in recognition of lower operating expenses in the interim consolidated financial statements at December 31, 2019, and consequently higher gross operating profits in the amount of 602 thousand euros, as a consequence of operating lease payments which were recognized as operating expenses until application, offset by a greater amortization expense for the new recognized right-ofuse assets in the amount of 396 thousand euros and increased finance expenses for the new lease liabilities in the amount of 106 thousand euros, so that the accounting profit for the period was not significantly affected.

- The effect of applying IFRS 16 on the cash flow statement at December 31, 2019:

The application of IFRS 16 resulted in recognition of an increased cash flow from operating activities in the consolidated cash flow statement at December 31, 2019, amounting to 100 thousand euros, as a consequence of increased gross operating profits, offset by a decrease in cash flows from financing activities corresponding to the reimbursement of the principal on the new lease liabilities, so that cash flow generation was not affected.

b) New standards, amendments, and interpretations effective for periods beginning on or after January 1, 2020:

		Mandatory application for annual periods
Standards issued by the IASB pending adoption by the European Union		beginning on or after:
References to the Conceptual Framework for IFRS (Amendment)	Ensures consistency in the standards and includes a new chapter on measurement, improved definitions and guidelines, and clarifications in important areas such as prudence and assessment of uncertainty	January 1, 2020
IFRS 3 (Amendment) - Business combinations	New definition of "business"	January 1, 2020
IAS 1 and IAS 8 (Amendment) Definition of	New definition of materiality, ensuring	January 1, 2020
"materiality"	consistency with respect to all standards
IFRS 17 - Insurance Contracts	A new standard which replaces IFRS 4	January 1, 2021

None of these standards and amendments were applied early, and from its preliminary analysis no significant impacts are expected.

2.3 Responsibility for the information presented and significant estimates

The Board of Directors of the Parent is responsible for the information contained in the accompanying consolidated financial statements.

The most significant judgments and estimates necessary for application of the accounting policies described in Note 4 are as follows:

• · The fair value of assets and liabilities acquired in business combinations (Note 5)
• · The useful life of intangible assets and PP&E items (Notes 4.3 and 4.4)
• · Impairment losses on certain assets (Notes 4.4, 4.7, and 4.10)
• · The probability of occurrence and amounts corresponding to certain provisions and contingencies (Note 16)
• · The recognition of income based on degree of project completion (Nota 4.13)
• · The market value of derivatives and interest rate swaps (Note 17.4)
• · The recoverability of deferred tax assets (Note 20)

Although these estimates were made based on the best information available regarding the events analyzed, events that take place in the future might make it necessary to change these estimates (upwards or downwards) in coming years. Changes in accounting estimates would be applied prospectively in accordance with the requirements of IAS 8, recognizing the effects of the change in estimates in the corresponding consolidated income statement.

2.4 Comparison of information

For the purposes of comparing the income statement for 2019 with that for 2018, the effects of the application of IFRS 16 described above must be taken into account.

As indicated in Note 1.1, for all prior periods, as well as for the period ended December 31, 2018, the Group prepared its financial statements in accordance with the Spanish GAAP ("PGC" in its Spanish acronym - General Chart of Accounts and "NOFCAC" in its Spanish acronym - Rules for Preparation of Annual Consolidated Financial Statements).

For purposes of the Parent applying for admission to trading of its shares on the Madrid, Barcelona, Bilbao, and/or Valencia stock exchanges, the Group opted for preparation of the special purpose consolidated financial statements for FY 2018 under international regulations (IFRS-EU).

The figures included at December 31, 2018 differ from those in the consolidated financial statements of the Group authorized by the Board of Directors of the Parent on March 29, 2019 and approved by the shareholders in general meeting on July 23, 2019 as a consequence of the restatement and the change in presentation described below:

• Change in presentation beginning from January 1, 2019 In 2019, and effective from January 1, 2019, the Group decided to modify the presentation of revenue with respect to capital gains obtained in the sale of companies owning the photovoltaic solar farms, with a view to improving the presentation of the transaction's economic substance. Until now, the Group recognized gains from the sale of shares of subsidiaries under "Gains (losses) due to loss of control over consolidated interests." Commencing 2019, the amount of the capital gains on the sale of these shares will be recognized under "Revenue" on the consolidated income statement if the park is built for a third party, and under "Impairment losses and gains (losses) on disposal of non-current assets" should the park have been previously classified as "Property, plant, and equipment".
• During the second half of 2018, the Group recorded the sale of shares in a company developing a 100% terminated solar plant in Chile (in "ready to build" status), as it considered that all the asset's risks and rewards had been transferred, as well as its stage of completion. During the second half of the year, the Group initiated admission to trading of its shares on the Madrid, Barcelona, Bilbao, and Valencia stock markets; during the process, the CNMV (Comisión Nacional del Mercado de Valores) made recommendations regarding the recognition of certain construction and development sales contracts, due to differing professional judgment regarding the transfer of the asset's risks and rewards, as well as the advantages of the asset within the controltransfer analysis. Therefore, the figures for the year-end 2018 were adjusted, with an effect on results for the year in the amount of -9,174 thousand euros on revenue, and -3,553 thousand euros on results for the year.

Thus, and exclusively for comparative purposes, the consolidated financial statements for the year ended 31 December 2018 were restated as follows:

STATEMENT OF FINANCIAL POSITION	12.31.2018	Reclassifications	12.31.2018 Restated
CURRENT ASSETS
Inventories	6,003,631	5,621,065	11,624,696
Plants in progress	4,858,820	5,621,065	10,479,885
Trade and other receivables	17,930,825	(3,334,750)	14,596,075
Trade receivables for sales and services	8,265,413	4,219,508	12,484,921
Other receivables	7,566,075	(7,554,258)	11,817
TOTAL ASSETS	58,285,364	2,286,315	60,571,679
STATEMENT OF FINANCIAL POSITION	12.31.2018	Reclassifications	12.31.2018 Restated
EQUITY
Profit for the year attributable to the Parent	13,279,402	(3,553,440)	9,725,962
CURRENT LIABILITIES
Bonds and other marketable securities	11,923,527	5,839,755	17,763,282
Clients prepayments	-	5,839,755	5,839,755
TOTAL EQUITY AND LIABILITIES	58,285,364	2,286,315	60,571,679

			12.31.2018
12.31.2018	Reclassifications	Adjustments	Restated
			26,577,205
			25,567,266
			1,009,770
			(22,061,075)
			(21,703,217)
			9,357,919
			11,532,405
			-
			15,408,130
13,085,899	-	(3,553,440)	9,532,459
	27,286,569 26,276,630 - (26,672,370) (26,314,512) 4,547,502 6,721,988 13,275,558 18,961,570	8,465,141 8,465,141 (4,611,295) 4,611,295 4,611,295 4,810,417 4,810,417 (13,275,558) -	(9,174,505) (9,174,505) 5,621,065 - - - - - (3,553,440)

In contrast, as a consequence of IFRS 16 becoming effective (Note 2.2), certain balances were restated in the consolidated statement of financial position for the year ended December 31, 2018. The accounting treatment of finance leases prior to the date of first-time adoption, and which correspond to rental contracts for vehicles, is maintained without changes as compared to IAS 17; however, the carrying amount of 183 thousand euros for finance leases recognized under "Property, plant, and equipment" was reclassified to "Right-of-use assets."

3. Application of the Parent company's results

The proposal for distribution of the result formulated by the directors of the parent company that will be submitted for approval by the shareholder's meeting is as follows:

	Euros
Basis of Distribution
Profit from the year	7,182,026
	7,182,026
Application
To legal reserve	718,203
To voluntary reserve	6,225,381
To capitalization reserve	238,442
	7,182,026

4. Accounting principles and policies and measurement criteria

4.1 Consolidation principles

4.1.1 Subsidiaries

All companies over which Grenergy Renovables, S.A. exercises control are considered subsidiaries. The Group controls an entity when it is exposed to, or has rights to, variable returns from its involvement with the investee and has the ability to affect those returns through its power over the entity. When assessing whether the Group controls another company, the existence and effect of potential voting rights exercisable at the date to which the assessment relates is taken into account together with possible agreements with other shareholders.

The Group's subsidiaries are consolidated using the full consolidation method: all of their assets, liabilities, income and expenses are included in the consolidated financial statements once the adjustments and eliminations corresponding to intra-group transactions have been performed. Subsidiaries are excluded from consolidation from the date on which they no longer form part of the Group.

The acquisition of subsidiaries is accounted for using the acquisition method. Acquisition cost is the fair value of the assets delivered, equity instruments issued, and liabilities incurred or assumed at the exchange date, plus any costs directly attributable to the acquisition. Any excess of the acquisition cost over the fair value of the identifiable net assets acquired is recognized as goodwill. If the acquisition cost is less than the fair value of the identifiable net assets of the subsidiary acquired, the difference is recognized directly in the consolidated income statement. The latter case is "advantageous purchases" for which they follow the steps indicated in accordance with IFRS 3.

The intangible assets acquired via a business combination are recognized separately to goodwill if the recognition criteria for assets are fulfilled, that is, if they can be separated or arise from legal or contractual rights and when their fair value can be reliably measured.

Identifiable assets acquired and liabilities or contingent liabilities assumed in a business combination are initially measured at their fair values as of the acquisition date, regardless of the percentage of minority interests.

When loss of control over a subsidiary occurs, for exclusive purposes of the consolidation, the gains or losses recognized in the separate financial statements of the company which is reducing its interests must be adjusted by the amount which arose from the reserves held in consolidated companies and generated from the acquisition date, as well as the amount which arose from income and expenses generated by the subsidiary in the year until the date on which control is lost.

With respect to the interest held by external partners, their interest in equity is recognized under "Equity" as "Minority interests" in the Group's consolidated statement of financial position. Likewise, profit for the year attributable to minority interests is recorded under "Results attributable to minority interests" in the consolidated income statement.

4.1.2 Prior standardization of the balances recognized in the separate financial statements

Before proceeding to perform the eliminations upon consolidation, the reporting periods, measurement criteria, and internal operations were standardized.

The Group companies' financial statements correspond to the financial year ended December 31, 2019. The year end of the subsidiary Kosten, S.A. (Argentina) is July 31, 2019; hence, the corresponding adjustments were made to standardize the reporting periods.

In order to standardize internal operations, the amounts recognized for balances arising from internal transactions which were not in agreement, or those for which there were amounts pending recognition, the appropriate adjustments were made to perform the subsequent eliminations.

In order to standardize the groupings, when the structure of the financial statements of a Group company did not agree with that of the consolidated financial statements, the necessary reclassifications were performed.

4.1.3 Conversion of financial statements of companies included in the consolidation scope

All the goods, rights, and obligations of foreign companies are translated into euros using the exchange rate prevailing at the closing date to which the financial statements of said companies refer. The balances in the income statements are converted using the exchange rates prevailing at the dates upon which the transactions were carried out, applying an average rate. The difference between the amount of equity calculated as per the above and the amount of equity converted at the historic exchange rates is recorded under equity in the consolidated statement of financial position under "Currency translation differences."

4.1.4 Goodwill on consolidation or negative consolidation difference

"Goodwill on consolidation or negative consolidation difference" is determined based on the criteria established in Note 4.2, "Business combinations."

Goodwill is not amortized; rather, as indicated in IFRS 3, it is tested for impairment at the end of every reporting period or sooner if there are indications of impairment. Goodwill recognized in a business combination is allocated to the cash-generating units (CGUs) or groups of CGUs in the Group expected to benefit from the synergies of the combination, applying the criteria outlined in section 4.4 herein. Subsequent to initial recognition, goodwill is measured at cost less any accumulated impairment losses.

4.1.5 Transactions between companies included in the consolidation scope

Subsequent to the standardizations described in the previous section, the reciprocal credits and debits as well as income and expenses, and results from internal transactions not carried out with respect to third parties, were eliminated.

4.1.6 Changes in the consolidation scope and main transactions in 2019 and 2018

The main changes to the consolidation scope corresponding to 2019 were as follows:

a) New additions to the consolidation scope:

· On February 20, 2019 the following companies were incorporated in Spain: GR Sison Renovables, S.L.U., GR Porron Renovables, S.L.U., GR Bisbita Renovables, S.L.U., GR Avutarda Renovables, S.L.U., GR Colimbo Renovables S.L.U., GR Mandarin Renovables, S.L.U., GR Danico Renovables, SLU, GR Charran Renovables, S.L.U., GR Cerceta Renovables, S.L.U., GR Calamon Renovables, S.L.U., GR Cormoran Renovables, GR Garcilla Renovables, S.L.U., GR Launico Renovables, S.L.U., GR Malvasia Renovables, S.L.U., GR Martineta Renovables, S.L.U., and GR Faisan Renovables, S.L.U.; with share capital of 3,000 euros for each of them. At December 31, 2019 the share capital of these companies was not yet paid in.

b) Removal from consolidation scope:

· On November 30, 2018, the Parent Company sold its shares in the company GR Chaquihue, S.p.A. The sale of shares contract of the dependent company included clauses that resolved the contract. Therefore, the sale has not been effective until the year 2019, when the park has been connected and then these clauses do not have effect.

• · On April 19, 2019 the Parent sold its interests in GR Tamarugo, SpA.
• · On June 26, 2019 the Parent sold its interests in GR Molle, SpA.
• · On June 28, 2019 the Parent sold its interests in GR Belloto, SpA.

The main changes to the consolidation scope corresponding to the year ended December 31, 2018 were as follows:

a) New additions to the consolidation scope:

• · On January 31, 2018 the following companies were incorporated in Spain: Chambo Renovables, S.L.U., Eiden Renovables, S.L.U., El Águila Renovables, S.L.U., and Mambar Renovables, S.L.U. with a share capital of 3,000 euros each. At December 31, 2018 the share capital of these companies was fully subscribed and paid in.
• · On April 18, 2018 the following companies were incorporated in Chile: GR Pimiento, S.P.A., GR Chañar, S.p.A., GR Carza, S.p.A., GR Pilo, S.p.A., GR Lúcumo, S.p.A., GR Pitao, S.p.A., GR Lleuque, S.p.A., GR Notro, S.p.A., GR Lenga, S.p.A., GR Tepú, S.p.A., GR Lumilla, S.p.A., GR Toromiro, S.p.A., GR Pacama, S.p.A., GR Temo, S.p.A., and GR Ruil, S.p.A. with a share capital of 1,358 euros each. At December 31, 2018 the share capital of these companies was pending disbursement.
• · On September 10, 2018, the companies GR Huacano, SpA, GR Corcolén, SpA, GR Luma, SpA, GR Fuinque, SpA, GR Piñol, SpA, GR Queñoa, SpA, GR Tayú, SpA, GR Petra, SpA, GR Corontillo, SpA, GR Liun, SpA, GR Kewiña, SpA, GR Frangel, SpA, GR Maqui, SpA, GR Petrillo, SpA, GR Tepa, SpA and Grenergy Opex, SpA with a capital of 1,258 euros each . As of December 31, 2018, the Share Capital of these companies was fully subscribed and pending disbursement.
• · On September 14, 2018, the companies Eugaba Renovables, S.L., Take Renovables, S.L. y Negua Renovables, S.L. were incorporated in Spain with a capital of 3,000 euros each. At December 31, 2018, the Share Capital of these companies was fully subscribed and paid up.

b) Removal from consolidation scope:

• · On April 11, 2018 the Parent sold its interests in GR Avellano, SpA.
• · On June 29, 2018 the Parent sold its interests in the following companies: GR Huingan, S.p.A., GR Pacific Pan de Azucar, S.p.A., and GR Arrayán, S.p.A.
• · On August 29, 2018, the Parent Company sold its shares in the companies GR Litre, SpA and GR Laurel, SpA.
• · On November 27, 2018, the Parent Company sold its shares in the company GR Quillay, SpA.
• · On December 21, 2018, the Parent Company sold its interests in the companies GR Alerce, SpA, GR Palma, SpA, GR Lilén, SpA and GR Melí, SpA.
• · On December 31, 2018, the Parent Company sold its interests in the companies GR
• · Tineo, SpA, GR Lingue, SpA and GR Guayacán, SpA.

4.2 Business combinations

The Group applies the acquisition method to account for its business combinations. The acquisition date is that on which the Group obtains control of the acquired business. The consideration transferred to acquire a subsidiary includes:

• · the fair values of the transferred assets
• · liabilities incurred with previous owners of acquired business
• · equity interests issued by the Group
• · the fair value of any asset or liability resulting from a contingent consideration arrangement, and
• · the fair value of any prior holding in the acquiree.

Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination, with certain limited exceptions, are measured initially at their acquisition-date fair values. The Group recognizes any non-controlling interests in an acquired entity at the respective acquisition dates at the percentage interest in the fair value of the identified net assets acquired.

Acquisition-related costs are expensed as incurred.

The excess amount of:

• · the consideration transferred
• · the amount of any non-controlling interests in the acquired entity, and
• · the fair value of any prior holding in the acquired

Any excess of the over the fair value of the identifiable net assets acquired is recognized as goodwill. Should the above amounts be under the fair value of the acquiree's net identifiable assets, the difference is directly recognized as results as a bargain purchase under "Negative goodwill in business combinations."

Where settlement of any portion of cash payments differ, amounts payable in the future are discounted at fair value at the exchange date. The incremental borrowing rate of interest is the discount rate applied, which is that which is obtainable for a similar loan agreement from an independent financial institution, under comparable terms and conditions.

The contingent consideration is classified as equity or a financial liability. Amounts classified as financial liabilities are subsequently remeasured at fair value, with changes in the fair value recognized under results.

If the business combination is achieved in stages, the acquisition-date fair value of the acquirer's previously held equity interest in the acquiree is remeasured to fair value at the acquisition date through profit or loss.

4.3 Intangible assets

Intangible assets are considered to be identifiable non-monetary assets, without physical substance, which arise as a result of a legal business or are developed internally. Only those assets are recognized whose cost can be estimated reliably and from which the Group considers it probable that future economic benefits will be generated.

Intangible assets are initially recognized at acquisition or production cost, and subsequently they are measured at cost less any accumulated amortization and impairment losses.

Licenses, patents, and trademarks (industrial property)

Patents, licenses, and trademarks are initially measured at acquisition price and are amortized on a straight-line basis over the estimated length of their useful lives (25 years).

Software

This heading includes amounts paid to acquire software and licenses to programs and computer applications, provided the Group plans to use them for several years. They are amortized systematically on a straight-line basis over a period of four years.

Expenses for maintenance or global reviews of the systems, or recurring expenses as a consequence of the modification or upgrading of these applications, are recognized directly as expenses in the year in which they are incurred.

4.4 Property, plant and equipment

PP&E items correspond to the assets owned by the Group for use in production and provision of goods and services or for administrative purposes and which are expected to be used during more than one period.

The assets comprising PP&E are recognized at acquisition cost (updated as per various legal provisions if applicable) or production cost, less accumulated depreciation and any impairment losses.

Likewise, "PP&E under construction" includes those expenses relating to the development and construction of certain installations which are still in the process of construction, in their initial phases of design, development, and construction, and which will be operated by the Group once they have started up.

The cost of PP&E constructed by the Group is determined following the same principles applied to acquisitions. Capitalized production costs are recognized under "Work performed by the entity and capitalized" in the consolidated income statement.

Costs incurred to enlarge, upgrade, improve, substitute or renovate PP&E items which increase productivity, capacity or efficiency, or extend the useful life of the asset, are recognized as a greater cost of said assets with the corresponding derecognition of the assets or items that have been substituted or renovated.

The acquisition cost of the PP&E items which require a period of more than one year to be readied for use includes those financial expenses accrued before being readied for use. No corresponding amounts were recorded in this respect during the period. In contrast, finance interest accrued subsequent to said date or used for financing the remaining PP&E items do not increase the acquisition cost and are recognized in the consolidated income statement for the year in which they accrue.

The costs incurred for refurbishing leased premises are classified as installations, and are depreciated systematically on a straight-line basis over a period of 8 years, never exceeding the duration of the lease agreement.

Conservation, repair, and maintenance expenses that do not increase the useful lives of assets are charged to the consolidated income statement of the year in which they are incurred.

Depreciation is calculated systematically on a straight-line basis so as to write off the acquisition or production cost over the estimated useful life of each asset, less the residual value, as follows:

	Years of useful life
Machinery	5-12
Plant and tools	25-33
Transport equipment	5-10
Furniture and fixtures	10
Data processing equipment	4
Other PP&E	6-8

The values and remaining life of these assets are reviewed at each reporting date and adjusted if necessary.

At the end of each period, the Group analyzes whether there are any indications that the carrying amounts of its PP&E assets exceed their corresponding recoverable amounts, that is, whether any of them are impaired. For those assets identified, it estimates the recoverable amount, which is understood to be the greater of (i) fair value less necessary sales costs and (ii) value in use. Where the asset does not generate cash flows independently of other assets, the Group estimates the recoverable amount of the cash-generating unit to which the asset belongs.

If the recoverable amount thus determined is lower than the asset's carrying amount, the difference is recognized in the consolidated income statement, reducing the carrying amount of the asset to the recoverable amount, and future depreciation charges are adjusted in proportion to the adjusted carrying amounts and the new remaining useful life, should a new estimate be necessary.

Similarly, if there is an indication of recovery in the value of an impaired asset, the Group recognizes the reversal of the impairment loss previously recorded and adjusts the future depreciation charges accordingly. Under no circumstances will said reversal result in an increase in the carrying amount of the asset exceeding that amount that would have been recognized had no impairment losses been recognized in previous years.

The gain or loss arising from the disposal or derecognition of a PP&E item is calculated as the difference between the consideration received and the carrying amount of the asset, and is included in the consolidated income statement of the year in which the change occurs.

4.5 Lease agreements

At inception of a contract, the Group assesses whether it is a lease agreement or includes a lease. A contract is a lease agreement, or contains a lease, when it transfers the right to control use of an identified asset for a period of time in exchange for consideration.

The lease term is the non-cancelable period, taking into account the initial term of each contract, unless Grenergy has the unilateral option of extending or terminating the contract and it is reasonably certain that it will exercise that option, in which case the corresponding extension or early termination terms are factored in.

Grenergy subsequently again assesses whether the contract is a lease agreement or contains a lease only if the terms and conditions agreed upon in the contract change.

Lessee

For each of the lease agreements in which it is the lessee, Grenergy will recognize a right-ofuse asset and a financial lease liability (Note 4.6 y 4.7).

Lessor

In the case of lease agreements in which it is the lessor, Grenergy will classify them as either operating leases or finance leases.

A lease is classified as a finance lease when Grenergy substantially transfers all the risks and rewards incidental to ownership of the underlying asset to the client. A lease is classified as an operating lease when the risks and rewards incidental to ownership of the underlying asset are not substantially transferred.

• Operating leases: Payments for operating leases are recognized as income in the income statement of the lessor on a straight-line basis over the term of the contract, except when a different distribution more faithfully reflects the pattern in which the profits deriving from use of the underlying leased asset are distributed.
• Finance leases: Grenergy recognizes the assets it holds in connection with a finance lease as a receivable balance in the consolidated statement of financial position, at an amount equal to the net investment in the lease, utilizing the implicit interest rate of the lease agreement for its valuation.

Subsequently, the lessor recognizes finance income over the term of the lease so that it obtains a constant interest rate for each period with respect to the pending net finance investment relating to the lease (leased asset). Further, the lessor applies the lease payments against the gross investment in order to reduce both the principal as well as the accrued finance income.

4.6 Right-of-use assets

The Group recognizes a right-of-use asset at the inception date of the lease agreement. The cost of the right-of-use asset includes the initial amount of the lease liability, any direct initial costs, payments for leases made prior to the inception date, as well as any dismantling costs related to the asset. Subsequently, the right-of-use asset is recognized at cost less accumulated amortization/depreciation and, if applicable, the associated impairment provision, adjusted to reflect any subsequent valuation or modification of the lease.

The Group applies the extension for leases in the short term (defined as leases with a duration less than or equal to 12 months) and leases of low-value assets. For these leases, the Group recognizes the lease payments as an operating expense on a straight-line basis over the lease term, unless a different approach more faithfully reflects the time pattern over which the economic benefits of the leased asset are consumed.

The right-of-use assets are depreciated/amortized on a straight-line basis over the shorter period of the lease term and the useful life of the underlying asset. If a lease involves transfer of ownership of the underlying asset or the cost of the right-of-use asset reflects the intention of the Group to exercise a purchase option, the asset related to the right-of-use is depreciated/amortized over the useful life of the underlying asset. Depreciation/amortization starts from the inception date of the lease.

4.7 Financial Instruments

A financial instrument is any contract that simultaneously gives rise to a financial asset for one entity and a financial liability or equity instrument for another entity. The Group only recognizes financial instruments in the statement of financial position when it becomes party to such a type of contract.

In the accompanying consolidated statement of financial position, financial assets and liabilities are classified as current depending on whether their maturity is equal to or less than twelve months from the reporting date. In the case of longer maturities, they are classified as non-current.

The financial assets and liabilities which the Group most frequently owns are the following:

• · Financing granted to related parties and personnel of the Group, regardless of the legal manner in which this occurs.
• · Trade receivables
• · Financing received from financial institutions and suppliers
• · Securities, both those representing debt (obligations, bonds, letters of credit, etc.) and those representing equity instruments of other entities (shares) or interests held in collective investment institutions.

a) Financial assets

Based on the characteristics of the contractual cash flows and the entity's business model for managing its financial assets, the Group recognizes the financial assets it holds in the following categories:

a) Assets at amortized cost: these financial assets are held in order to collect contractual cash flows which, based on their contractual terms, give rise to cash flows on specified dates that are solely payments of principal and interest.

This category includes "Trade and other receivables" which are measured at the moment of their recognition in the statement of financial position at market value and subsequently at amortized cost utilizing the effective interest rate. The Group recognizes the corresponding impairment provisions for any differences between the amount of its accounts receivable it reasonably expects to recover and their carrying amounts in accordance with the previous paragraph. The Group recognizes an impairment provision for these items in accordance with the expected losses. As indicated in Note 2.2 the Group has carried out an analysis of expected losses and concluded that this IFRS does not have any significant effect on the consolidated financial statements for the periods reported on in 2019 and 2018.

b) Financial assets at fair value through other comprehensive income: these are assets held with the objective of both obtaining contractual cash flows from them and selling them, and, based on the contractual clauses, the cash flows are received on specified dates that are solely payments of principal and interest. Interest, impairment losses, and translation differences are recognized in the consolidated income statement as per the amortized cost model. The remaining changes in fair value are recognized in consolidated equity balances and can be reclassified to the consolidated income statement when sold.

However, in the cases of equity instruments, provided they are not held for trading, they can be measured under this category without the amounts recognized in consolidated equity subsequently being reclassified to the consolidated income statement upon their sale, with only dividends received being recognized in the consolidated income statement.

c) Financial assets at fair value through profit or loss: this category includes the remaining financial assets not described in the previous categories.

b) Financial liabilities

Financial liabilities are classified based on the agreed-upon contractual terms and taking into account the economic substance of the corresponding transactions.

· Bank borrowings and other remunerated financial liabilities: Loans, bank overdrafts, obligations, and other similar instruments which accrue interest are initially recognized at fair value, which is equivalent to the cash received net of directly attributable transaction costs incurred. Finance expenses accrued, including premiums payable on settlement or redemption and direct issue costs, are recognized in the consolidated income statement using the effective interest rate method, increasing the carrying amount of the financial liabilities to the extent that they are not settled in the period in which they accrue. Said expense likewise include loans at zero interest, recognized at their nominal amounts given that they do not significantly differ from fair value.

Loans repayable in the short term, but whose long-term refinancing is assured at the discretion of Group through available long-term credit facilities, are classified as noncurrent liabilities in the accompanying consolidated statement of financial position.

On the other hand, loans associated with projects that are classified as "Inventories" are classified as current liabilities.

· Trade receivables: The Group's trade receivables in general do not mature in more than one year and do not accrue explicit interest, and are recognized at their nominal value, which is not significantly different to their amortized cost.

The Group derecognizes a financial liability, or a part of the financial liability, as soon as the obligations relating to the corresponding contract have either expired or been settled or canceled.

The substantial modifications of initially-recognized financial liabilities are accounted for as a cancellation of the original financial liability and the recognition of a new financial liability, provided the related conditions of the instruments are substantially different. The Group recognizes the difference between the carrying amount of the financial liability, or part of that liability, that has been extinguished or assigned to a third party and the consideration paid, including any assets assigned (other than cash) or liabilities assumed, in the consolidated income statement.

c) Own equity instruments

An equity instrument is any contract that evidences a residual interest in the Group's assets after deducting all of its liabilities.

The equity instruments issued by the Parent are recognized in equity at the amount received net of any issuance costs.

Share capital

Ordinary shares are classified as equity. No other shares exist.

Costs directly attributable to the issue of new shares are recognized under "Equity" are deducted of the total amount.

Treasury shares

Transactions involving treasury shares in 2019 and 2018 are summarized in Note 13.4. They are deducted from equity on the accompanying 2019 and 2018 consolidated statements of financial position.

When the Group acquires or sells own equity instruments, the amount paid or received is recognized directly in consolidated net equity. No gains or losses are recognized under profit or loss on the purchase, sale, or cancellation of the Group's equity instruments.

The Parent's shares are measured at average acquisition price.

Share options (Note 4.17)

The Group has Grenergy Renovables, S.A. share option plans granted to certain employees.

The ceded shares are considered own equity instruments under IFRS 2. Therefore, they are measured at fair value on the concession date, and charged to results using the straight-line method over the life of the plan, depending on the different vesting period of the share options, with a charge to equity.

As market prices are not available, the value of share options was determined using valuation

techniques contemplating all factors and circumstances which, between independent and perfectly informed parties, they would have applied to fix their value.

d) Cash and cash equivalents

This heading in the accompanying consolidated statement of financial position includes cash in hand, demand deposits at credit entities and other short-term highly liquid investments with original maturities of three months or less. The bank overdrafts are classified as borrowings under current liabilities in the accompanying consolidated statement of financial position.

4.8 Financial liabilities by lease

At the inception date of the lease, the Group recognizes a lease liability at the present value of the lease payments to be made over the lease term, discounted using the implicit interest rate of the lease or, if this cannot be easily determined, the incremental borrowing rate.

The lease payments to be made include fixed payments less any receivable lease incentives, variables which depend on an index or rate, as well as guarantees for the residual value expected to arise, the exercise price of a purchase option if it is expected to be exercised, as well as termination penalty payments, if the term of the lease reflects the intention of the lessor to exercise an option to terminate the lease.

Any other variable payment is excluded from recognition of the lease liability and the right-ofuse asset.

Subsequently, the lease liability is increased by the interest on the lease liability, reduced by the payments made. Likewise, the liability will again be measured if there are any modifications to the amounts payable and the lease duration.

4.9 Derivative financial instruments and accounting hedges

The Group's activities expose it to financial risks arising mainly from changes in interest rates. To hedge these exposures, the Group uses interest rate swaps. The Group does not use derivative financial instruments for speculative purposes, irrespective of the fact that in certain cases the conditions for applying hedge accounting are not met.

Derivatives are initially recognised at fair value and the required valuation adjustments are subsequently made to reflect their fair value at each point in time, and are recognised under "Current or Non-Current Financial Assets - Derivatives" in the consolidated statement of financial position if they are positive and under "Current or Non-Current Liabilities - Derivatives" in the consolidated statement of financial position if they are negative.

The gains or losses arising from these fluctuations are recognised in the consolidated income statement for the year, unless the derivative instruments have been designated as accounting hedges and the hedge is highly effective, in which case they are recognised as follows:

• · Fair value hedges: both the hedged item and the hedging instrument are measured at fair value, and changes in the fair value of both instruments attributable to the hedged risk are recognised in the consolidated income statement for the year, with the net effect on the item linked to the hedged item.
• · Cash flow hedges: the changes in the fair value of the hedging derivative financial instruments are recognised, in respect of the portion that was highly effective, net of

the tax effect, under "Adjustments for Changes in Value" in equity in the consolidated statement of financial position. The cumulative gain or loss on this heading associated with the derivative is transferred to the consolidated income statement as the hedged item affects the Group's income statement or in the year in which the hedge is disposed of, and the effect is recognised under the same heading in the consolidated income statement.

In the case of hedges of firm commitments or future transactions that result in the recognition of a non-financial asset or a non-financial liability, the cumulative gain or loss in equity associated with the derivative instrument is taken into account in determining the initial value of the asset or liability that generates the hedged item.

Conversely, the portion of the changes in the fair value of the derivative financial instrument that is determined to be ineffective is recognised immediately in the consolidated income statement.

This type of hedge relates mainly to derivatives contracted to convert floating rate financial debt into fixed rate financial debt.

· Hedge accounting is discontinued when the hedging instrument expires, is sold, terminated or exercised or no longer qualifies for hedge accounting. At that time, the cumulative gain or loss in equity under "Adjustments for Changes in Value" remains in equity until the hedged transaction is completed, at which time the gain or loss on the transaction is adjusted. If the hedged transaction is ultimately not expected to occur, the gain or loss recognised in equity is recognised in the consolidated income statement for the year.

Derivatives embedded in other financial instruments or other host contracts are accounted for separately when their characteristics and risks are not closely related and provided that the aggregate is not being carried at fair value with changes in fair value recognised in the consolidated income statement.

The fair value of the various derivative financial instruments is calculated using the following procedures:

• · Derivatives traded on organised markets: their fair value is obtained from their quoted price at year-end.
• · Derivatives not traded on organised markets: the Group uses standard financial market techniques to measure these derivatives, i.e. discounting all the future flows envisaged in the contract in accordance with its characteristics, such as the notional amount and the collection and payment schedule, based on market conditions at year-end. The values thus obtained by the Group are compared with the valuations submitted by financial intermediaries and independent third parties.

4.10 Inventories

Inventories are measured at the lower of cost or net realizable value. The cost of finished products and products in progress includes design costs, raw material and direct labor costs, as well as any other direct costs and general production overheads (based on the normal working capacity of the production methods), and interest expenses. Net realizable value is the estimated selling price in the ordinary course of business, less applicable variable sales costs.

Fixed assets (basically installations and civil engineering works) at the photovoltaic solar plants of subsidiaries included in the consolidation scope, meant for sale, are classified as inventories including reimbursable external finance expenses until they have been readied for operations.

The Group assesses the net realizable value of its inventories at each reporting date, recognizing any impairment losses as required if they are overstated. When the circumstances which gave rise to recognition of impairment losses on inventories no longer hold or there is clear evidence justifying an increase in the net realizable value due to changes in economic circumstances, the previously recognized impairment losses are reversed. This reversal is limited to the lower amount corresponding to cost or net realizable value of the inventories. Both impairment losses on inventories as well as their reversal are recognized in the consolidated income statement for the period.

The photovoltaic assets owned by the Group are initially classified as inventories, given that the directors consider that they will be sold. Where a decision is initially made to operate a photovoltaic solar plant, it then becomes apt for classification as PP&E. Should a photovoltaic plant previously-classified as inventory spend a year since construction without having been sold, it is then reclassified under the heading "Property, plant, and equipment."

4.11 Foreign currency translation

Functional and presentational currency

The balances included in the consolidated financial statements and the corresponding notes thereto for each of the Group's entities are measured using the currency of the main economic environment in which they operate ("the functional currency"). Group companies use the currencies of the countries in which they are located as their functional currency, apart from Grenergy Atlantic, S.A., Kosten, S.A., and Parque Eólico Quillagua, SpA, which uses the US dollar as its functional currency. This is due to the fact that they are reference in US currency, with investments and the majority of its expenses in this denomination.

The consolidated financial statements of the Group are presented in euros, unless explicitly stated otherwise.

Transactions and balances in foreign currency

As the Group's functional currency is the euro, all balances and transactions denominated in currencies other than the euro are deemed to be denominated in foreign currency. Said transactions are recognized in euros applying the spot exchange rates prevailing at the transaction dates.

At financial year end, the monetary assets and liabilities denominated in foreign currencies are converted to euros utilizing the spot exchange rate prevailing at said date in the corresponding currency markets.

The gains or losses obtained from settling transactions denominated in foreign currency and the conversion at closing date exchange rates of the monetary assets and liabilities denominated in foreign currencies are recognized in the consolidated income statement for the year under "Currency translation differences".

The exchange rates against the euro (EUR) of the Group companies' main currencies at December 31, 2019 and December 31, 2018 were as follows:

	December 31, 2019		December 31, 2018
	Closing exchange rate	Cumulated average rate (1)	Closing exchange rate	Cumulated average rate (1)
American Dollar (USD)	1.12	1.12	1.15	1.18
Argentine Peso (ARS)	67.27	67.27	43.11	43.11
Brazilian Real (BRL)	4.52	4.41	4.44	4.31
Chilean Peso (CLP)	845.31	786.7	794.63	757.34
Mexican Peso (MXN)	21.22	21.56	22.49	22.71
Australian Dollar (AUD)	1.60	1.61	1.62	1.58

4.12 Income tax

Income tax expense for the year is calculated as the sum of current tax, resulting from applying the corresponding tax rate to taxable income for the year (after applying any possible tax deductions), and any changes in deferred tax assets and liabilities.

The tax effect relating to items directly recognized in equity is recognized under equity in the consolidated statement of financial position.

Deferred taxes are calculated in accordance with the liability method, considering the temporary differences that arise between the tax bases of assets and liabilities and their carrying amounts, applying the regulations and tax rates that have been approved or are about to be approved at the reporting date and which are expected to apply when the corresponding deferred tax asset is realized or deferred tax liability is settled.

Deferred tax liabilities are recognized for all taxable temporary differences except for those arising from the initial recognition of goodwill or other assets and liabilities in a transaction that is not a business combination and affects neither taxable profit or accounting profit. Deferred tax assets are recognized when it is probable that the Group will generate sufficient taxable profit in the future against which the deductible temporary differences or the unused tax loss carryforwards or tax assets can be utilized.

At each reporting date the Group reviews the deferred tax assets and liabilities recognized to verify that they remain in force, making any appropriate adjustments on the basis of the results of the analysis performed.

The Spanish companies which belong to the Group file their tax returns under a consolidated regime, together with the parent of the Group, Daruan Group Holding, S.L. and the remaining companies that make up the tax group comprised of Daruan Group Holding, S.L. and subsidiaries, with tax identification number 0381/14. Thus, the deductions on payable taxes affect the calculation of the Group's tax obligations by the effective amount applicable under the consolidated tax regime and not by the amount that would result under an individual tax regime.

On December 16, 2019, the Parent placed a package of private shares on the market, by virtue of which the Company's majority shareholder, Daruan Group Holding, S.L., now is holds a majority, with 68% of the shares (Note 12). Therefore, and as a result of a 70% ownership decrease, the Parent and its Spanish subsidiaries no longer belong to Daruan Group Holding, S.L. and subsidiaries; as a result, each files separate corporation tax returns.

4.13 Income and expense recognition

a) General

Revenue derived from contracts with customers is recognised based on compliance with performance obligations with customers in accordance with IFRS 15.

Revenue reflects the transfer of goods or services to customers at an amount that reflects the consideration to which Naturgy expects to be entitled in exchange for such goods or services.

Five steps are established for the recognition of revenue:

• 1. Identify the customer's contracts.
• 1. Identify the performance obligations.
• 1. Determine the price of the transaction.
• 1. Allocate the transaction price to the performance obligations.
• 1. Recognise the revenue according to the fulfilment of each obligation.

Based on this recognition model, sales are recognised when products are delivered to the customer and have been accepted by the customer, even if they have not been invoiced, or if applicable, services are rendered, and it is probable that the economic benefits associated with the transaction will flow to the entity. Revenue for the year includes the estimate of the energy supplied that has not yet been invoiced.

Expenses are recognised on an accruals basis, immediately in the case of disbursements that are not going to generate future economic profits or when the requirements for recording them as assets are not met.

Sales are stated net of tax and discounts and transactions between Grenergy companies are eliminated.

b) Income from construction contracts

For engineering, procurement and construction contracts (EPC contracts), carried out on land owned by third parties, in general, the performance obligations that the Group performs are satisfied over time and not at a specific time, since:

• The client simultaneously receives and consumes the benefits provided by the entity's performance as the service is provided.
• The asset does not have an alternative use for the Group.
• The Group has the enforceable right to pay for the performance completed to date. For these purposes, the existence of resolving clauses will also be taken into account.

For EPC contracts, in the absence of significant deviations from actual and budgeted costs, Grenergy recognizes revenue, as a general rule according to the "Input-based method" or "Degree of progress on costs", recognizing ordinary revenue based on the efforts or costs that the Group has allocated to meet the performance obligation in relation to the total costs planned to meet the performance obligation. Losses which may arise on the contracted projects are recognized, in their totality, at the moment said losses become apparent and can be estimated. The difference between revenue recognized for a project and the amount invoiced for that project is recognized in the following manner:

• if it is positive, such as "Work completed pending invoice" (deferred invoicing), under "Trade and other receivables;"
• if it is negative, such as "Advance collections" (early invoicing), under "Accruals".
• c) Income from the sale of solar farms

Income from the sale of the solar farms is recognized when the ownership of the underlying goods and services have been transferred to the buyer to meet the performance commitment.

Specifically, the sale of farms with PP&E classified under "Inventories" (Note 4.10) is recognized under "Revenue" on the consolidated income statement as the sum of the price of the photovoltaic park's shares, plus the amount of its net debt (total debt less working capital); at the same time, "Inventories" are derecognized with a charge to "Changes in inventory of finished goods and work in progress" on the consolidated income statement. The difference between these two amounts is the operating profit on the sale.

The sale of shares in solar plants deemed 100% ready to build takes place when the buyer has been transferred the control of the underlying services for the performance obligation and sale to be considered legally irrevocable. The existence of termination rights are also taken into account in this regard.

d) Revenue from the rendering of services

Revenue from rendering of services, such as those related to operation and maintenance agreements and photovoltaic park administration are recorded when the entity satisfies a performance obligation by transferring a promised good or service to a customer, regardless of when actual payment or collection occurs.

4.14 Provisions and contingencies

An preparing the consolidated financial statements, the Directors of the Parent made a distinction between:

• · Provisions: existing obligations at the reporting date arising from past events that are uncertain as to amount or timing, but for which it is probable that the Group will suffer an outflow of resources the amount of which can be reliably estimated.
• · Contingent liabilities: possible obligations arising as a consequence of past events, materialization of which is conditional upon one or more events occurring in the future not entirely within control of the Group and which do not meet the requirements for recognition as provisions. There were no significant other contingent liabilities at the end of 2019 and 2018.

The consolidated financial statements of the Group record all significant provisions with respect to which it considers there is a high probability that the related obligation will have to be met. These liabilities are quantified based on the best information available at the reporting date regarding the consequences of the triggering event and taking into account the time value of money, if significant.

Their allocation is made with a charge against the consolidated income statement for the year in which the obligation arises (legal, contractual, or implicit), and can be fully or partially reversed with a credit to the consolidated income statement when the obligations cease to exist or decrease.

Dismantling provisions

The Group recognises a provision for the costs of dismantling solar and wind farms. Dismantling costs are determined as the present value of the expected costs to settle the obligation using estimated cash flows and are recognised as part of the cost of the asset. Cash flows are discounted at a pre-tax discount rate that reflects the specific risks of the dismantling obligation. The reversal of the discount is recognised in the income statement as a finance cost as it occurs.

Estimated future decommissioning costs are reviewed annually and adjusted accordingly. Changes in estimated future costs or in the discount rate applied are added to or reduced to the cost of the asset.

Provisions are determined by discounting expected future cash flows using pre-tax market interest rates and, where appropriate, risks specific to the liability; if discounting has a material effect. When the discount method is used, the increase in the provision due to the passage of time is recognised as a finance cost.

The Group's policy is to recognise this provision when the plant becomes operational.

4.15 Environmental assets and liabilities

Environmental assets are classified as those the Group utilizes in its activities over a long period of time whose primary purpose is to minimize the environmental impact and protect or improve the environment, including those assets designed to reduce or eliminate future contamination from the Group's activities.

The criteria for initial recognition, allocation, amortization/depreciation, and possible valuation adjustments due to impairment losses on said assets are as described in Note 3.3 above.

Given the Group's activities, and in accordance with prevailing legislation, it controls the degree of contamination produced by waste and emissions by applying an appropriate waste disposal policy. Expenses for these purposes are charged to the consolidated income statement for the year in which they are incurred.

4.16 Employee benefits expenses

Employee benefits expenses include all the Group's duties and obligations of a social nature, whether mandatory or voluntary, recognizing the obligations for bonus salary payments, holidays, and variable remuneration, as well as associated expenses.

a) Short-term employee benefits

This type of remuneration is measured at the undiscounted amount payable in exchange for services received. These benefits are generally recognized as personnel expenses for the year and are presented as a liability in the consolidated statement of financial position corresponding to the difference between the total expense accrued and the amount settled at the reporting date.

b) Termination benefits

In keeping with prevailing legislation, Group entities are obliged to pay indemnities to employees who are dismissed through no fault of their own. Said termination benefits are payable when employment is terminated by the Group before the normal retirement date, or whenever an employee accepts voluntary redundancy in exchange for these benefits. The Group recognizes termination benefits when it has a demonstrable commitment to terminate its current labor contracts under an irrevocable and detailed plan or to provide the benefits as part of an offer to encourage voluntary redundancy.

At the closing of the periods ended December 31, 2019 and December 31, 2018 there were no plans for reducing personnel which would require a corresponding provision.

4.17 Share-based payments

Transactions in which the company receives goods or services, including services rendered by employees, in exchange for its own equity instruments, or an amount based on the value of its equity instruments, such as share options or share appreciation rights, are considered equity-settled share-based payment transactions.

The Group shall first recognize the goods and services received as an asset or an expense, based on their nature, at the date obtained and, subsequently, the corresponding increase in equity if the transaction is settled with equity instruments or the corresponding liability if settled with a cash amount based on the value of equity instruments.

If the Group has the option to settle with equity instruments or in cash, it must recognize a liability to the extent that it has incurred a present obligation to settle in cash or with other assets; alternatively, it shall recognize an increase in equity. If the choice corresponds to the supplier of the goods or services, the Group will recognize a compound financial instrument, which shall include a liability component, for the other party's right to demand payment in cash, and an equity component, for the right to receive the consideration in equity instruments.

In transactions in which services must be completed throughout a certain period of time, these services shall be recognized as rendered during said period.

In transactions with employees which are settled with equity instruments, both the services rendered and the increase in equity to be recognized shall be measured at fair value of the equity instruments assigned on the grant date.

Equity-settled transactions which relate to goods or services other than those offered by employees shall be measured at the fair value of those goods or services, if this can be measured reliably, at the date received. If the fair value of the goods or services received cannot be reliably measured, the goods or services received and the increase in equity shall be measured at the fair value of the equity instruments granted at the date the Group obtains the goods or the other party renders the services.

After recognition of the goods and services received, as established in the above paragraphs, as well as the corresponding increase in equity, no additional adjustments shall be made to equity after the vesting date.

For cash-settled transactions, the goods or services received and the liability to be recognized shall be measured at the fair value of the liability corresponding to the date recognition requirements are met.

Thereafter, and until settlement, the fair value of the corresponding liability shall be remeasured at each year end and any changes in value during the year shall be recognized in the income statement.

At December 31, 2019 the Parent had granted an incentive plan to its employees consisting of options on its shares. Said plan establishes that the transactions shall be settled via delivery of equity instruments (Note 13.5).

4.18 Related party transactions

Transactions carried out between related companies are in general measured initially at fair value. When the agreed-upon prices differ from fair value, the differences are recognized based on the economic reality of the transaction. Subsequent measurements are carried out as established in the corresponding regulations.

Notwithstanding the above, in the case of merger transactions, spin-offs, or non-monetary contributions of a business, the Group applies the following criteria:

• a) For transactions between related companies in which the Parent is involved, or the parent of a subgroup and one of its subsidiaries (directly or indirectly owned), the items comprising the acquired business are measured at the corresponding amount, once the transaction has been carried out, recorded in the consolidated financial statements of the Group or subgroup.
• b) In the case of transactions between other Group companies, the assets and liabilities of the business are measured at the amounts at which they were carried in the separate financial statements prior to the transaction.

The difference which may arise is recognized under reserves.

4.19 Earnings per share

Basic earnings per share are calculated by dividing consolidated profit for the year attributable to the Parent by the weighted average number of ordinary shares outstanding during the year, excluding the average number of Parent shares held by the Group.

Diluted earnings per share are calculated by dividing consolidated profit for the year attributable to ordinary shareholders adjusted by the effect attributable to the dilutive potential ordinary shares by the weighted average number of ordinary shares outstanding during the year, adjusted by the weighted average number of ordinary shares that would be issued on the conversion of all the potential ordinary shares into ordinary shares of the Parent. For these purposes, conversion is deemed to take place at the beginning of the period or at the time of issue of the potential ordinary shares, if they had been issued during the period.

5. Business combinations

On November 8, 2019, the Parent owned 100% of the share capital of Parque Eólico Quillagua SpA (PEQ). PEQ is devoted to the development, generation, production, distribution, and sale, in any form, be it on its own behalf or that of third parties of all types of energy, including renewable, conventional, or non-conventional.

According to its share purchase-sale agreement, the price was 8,873,959 euros payable as follows, and subject to revision as indicated further on:

• 4,862,103 euros payable on the closing date (November 8, 2019);
• 4,011,856 payable when either of the following takes place: provisional reception of the built project (95 MW of nominal capacity), or the 15 months subsequent to closing.
• Should the project exceed the 95MW of nominal capacity, the price would then rise in the amount of 72,500 euros for each additional MW of nominal capacity exceeding 95 MW.

Price adjustment:

The price is adjusted downward in the amount equal to the costs incurred to refurbish the substation in order to offload energy to the tap-off standardization grid, in line with applicable legislation, as follows:

• The share purchase-sale agreement indicates that the parties agree to estimate the tap-off normalization cost at 1,863,526 euros, with PEQ carrying out its execution when considered appropriate, based on its own criteria.
• The sellers agree to guarantee Grenergy reimbursement of the excess amount paid in the equivalent amount of the effectively-incurred costs until it reaches tap-off standardization cost (considering it is a price reduction).
• The above was obtained based on a quote from the engineering company in charge.

On the basis of the foregoing and in accordance with IFRSs, the cost of the business combination is provisional at 31 December 2019 and there is a period of 12 months from the acquisition to complete it.

The provisional business combination cost is the following:

	Euros
Price paid	4,862,103
Amount outstanding	4,011,856
Variable price depending on MW higher than the nominal 95MW	-	(1)
Tap-off standardization adjustment	(1,863,526)	(2)
TOTAL	7,010,433

(1) Nominal power output is not expected to exceed 95 MW.

(2) The amount reflected above included in the share purchase-sale agreement was obtained based on a quote from the engineering company in charge of carrying out the project.

The tap-off standardization adjustment is discounted from the outstanding amount; therefore, the amount payable to the subsidiary's sellers is estimated at 2,148,330 euros during 2019 (Note 17).

The following assets and liabilities were identified during the acquisition:

	Net carrying amount	Fair value
Installations	8,062,996	10,467,171
Development costs	-	5,709,366
Deferred tax assets	1,934,376	1,934,376
Other assets	3,386	3,386
Other liabilities	(122,984)	(122,984)
TOTAL	9,877,773	17,991,314

Therefore, a previsional negative difference on consolidation was generated from the business combination:

	Euros
Cost of the business combination	7,010,433
Assets and liabilities acquired	17,991,314
Difference	10,980,882
Deferred tax liability (27%) (*)	(2,190,656)
Negative difference on consolidation	8,790,226

(*) The deferred tax liability in the above table corresponds to the difference between fair value and the net carrying amount of the installations and stage of development on the acquisition date.

The fair value of the installations was determined by an independent expert based on their replacement value.

The valuation was performed contemplating aspects such as the project's plant, forecasted sales price of energy output, the project's location, specific production of nearly 3,000 MWh/MW, and the price of other similar transactions. It should also be noted that one of the items adding value to this development is the fact that the project was ready to build at the time of the purchase-sale transaction.

The negative consolidation difference arose as this was a bargain purchase, since the seller had been unsuccessfully trying to find a buyer for several years.

6. Property, plant, and equipment

The breakdown and movements during the year ended December 31, 2019 and 2018 of balances recognized under this heading in the accompanying consolidated statement of financial position are as follows:

	Machinery and	Other installations,		PP&E under
	technical installations	tools and furniture	Other PP&E	construction	TOTAL
COST
Balance at 12.31.2017	15,467,216	506,017	275,578	1,293,467	17,542,278
Additions	162,241	5,833	72,095	26,570,743	26,810,912
Derecognitions and decreases	(25,551,747)	(32,705)	(28,073)	-	(25,612,525)
Reclassifications	153,399	68,894	(222,293)	-	-
Transfers	11,524,431	-	-	(11,524,431)	-
Balance at 12.31.2018	1,755,540	548,039	97,307	16,339,779	18,740,665
Business combinations (Note 5)	-	-	-	10,467,171	10,467,171
Additions	282,857	706,545	79,145	44,633,916	45,702,463
Derecognitions and decreases	-	(156,710)	(77,991)	-	(234,701)
Balance at 12.31.2019	2,038,397	1,097,874	98,461	71,440,866	74,675,598
DEPRECIATION
Balance at 12.31.2017	(700,259)	(221,562)	(66,244)	-	(988,065)
Allowance for the period	(810,120)	(40,290)	(14,939)	-	(865,349)
Decreases	17,974	20,191	23,694		61,859
Balance at 12.31.2018	(1,492,405)	(241,661)	(57,489)	-	(1,791,555)
Allowance for the period	(138,766)	(33,862)	(40,286)	-	(212,914)
Decreases	-	1,665	39,932		41,597
Balance at 12.31.2019	(1,631,171)	(273,858)	(57,843)	-	(1,962,872)
IMPAIRMENT
Balance at 12.31.2017	-	-	-	-	_
Allowance for the period	-	-	-	(2,174,486)	(2,174,486)
Decreases	-	-	-	-
Balance at 12.31.2018	-	-	-	(2,174,486)	(2,174,486)
Allowance for the period	-	-	-	(191,381)	(191,381)
Decreases	-	-	-	-	-
Balance at 12.31.2019	-	-	-	(2,365,867)	(2,365,867)
Carrying amount at 12.31.2018	263,135	306,378	39,818	14,165,293	14,774,624
Carrying amount at 12.31.2019	407,226	824,016	40,618	69,074,999	70,346,859

The useful lives and depreciation criteria used for these items are disclosed in Note 4.3.

The main additions of the 2019 and 2018 fiscal years correspond to farms built during both exercises maintained for exploitation and that are in progress at the end of both exercises.

There were no significant derecognitions during 2019. The principal derecognitions during 2018 mainly correspond to the sale of the solar plants associated with the following Group companies: Grupo GR Huingan SpA, GR Litre SpA, GR Laurel SpA, GR Tineo SpA, GR Lingue SpA, GR Guayacan SpA, and GR Pan de Azucar Spa. These sales generated profit in the amount of 11,532,405 euros recognized under "Impairment and gains on disposal of non-current assets" on the accompanying consolidated income statement.

The fixed assets under construction in the previous table correspond to the cost of fixed assets related to solar and wind farms. The detail by park at the end of the 2019 and 2018 exercises is as follows:

Farm name	Technology	Country	Capacity (MW)	12.31.2019	12.31.2018
Kosten	Wind	Argentina	24	31,102,578	11,320,119
Duna & Huambos	Wind	Peru	36	15,011,985	1,363,303
Quillagua(*)	Solar	Chile	103	19,358,155	-
Other developments	Solar	Spain/Chile/Peru/Colombia	-	3,602,281	1,481,871
TOTAL				69,074,999	14,165,293

(*) The cost corresponds to the additions by business combination amounting to 10,467 thousand euros (Note 5) and 8,891

thousand euros for additions in the year.

Impairment losses

During the period ended December 31, 2019 the Group recognized impairment losses on PP&E in the amount of 191 thousand euros (2018: 2,174 thousand euros), mainly corresponding to various ongoing projects principally located in Mexico and a plant in Chile (reclassified from inventories to fixed assets in 2018).

Fully depreciated assets

At year-end 2019, the Group held fully-depreciated assets still in use under "Property, plant, and equipment" totaling 30,035 euros (2018: 96,623 euros).

Firm purchase and sale commitments.

The Group had not commitments for buying or selling any of its items of PP&E in a significant amount. Assets corresponding to the Kosten, Duna & Huambos, and Quillagua farms are subject to guarantees within the project finance contracts signed for each park (Note 17.2).

Insurance

The Group has arranged several insurance policies to cover the potential risks which could affect its items of property, plant and equipment. The coverage of these insurance policies is considered sufficient.

7. Intangible assets

The composition and movements during the years 2019 and 2018 in the accounts included in this heading of the accompanying consolidated statement of financial position have been the following:

	Patents, licenses and trademarks	Software	TOTAL
COST
Balance at 12.31.2017	2,845,760	10,737	2,856,497
Additions	-	-	-
Business combinations	(151,435)	-	(151,435)
Balance at 12.31.2018	2,694,325	10,737	2,705,062
Business combinations (Note 5)	5,709,366	-	5,709,366
Additions	957,720	81,501	1,039,221
Currency translation differences	13,776	-	13,776
Balance at 12.31.2019	9,375,187	92,238	9,467,425
DEPRECIATION
Balance at 12.31.2017	-	(6,772)	(6,772)
Allowance for the period	-	(872)	(872)
Decreases	-	-	-
Balance at 12.31.2018	-	(7,644)	(7,644)
Allowance for the period	-	(13,874)	(13,874)
Decreases	-	-	-
Balance at 12.31.2019	-	(21,518)	(21,518)
Carrying amount at 12.31.2018	2,694,325	3,093	2,697,418
Carrying amount at 12.31.2019	9,375,187	70,720	9,445,907

The useful lives of these assets, as well as the amortization criteria used are detailed in Note 4.4 of this consolidated report.

"Patents, licenses, trademarks, and similar" chiefly correspond to the fair value of the development acquired from Parque Eólico Quillagua, SpA in the amount of 5,709,366 euros (Note 5).

Impairment losses

The Group's Directors consider that there are no indications of impairment of the different assets of intangible assets at the end of the 2019 and 2018 financial years, so no impairment has been made during the year.

Fully amortized assets

At the close of the 2019 and 2018 financial years, the Group kept intangible assets fully amortized and still in use amounting to 6,160 euros.

Lease agreements

At year-end 2019 and 2018, the Group did not have any intangible assets under finance leases. It did not have any operating lease agreements for any of its intangible assets.

Firm purchase and sale commitments

The Group has no commitments for the acquisition or sale of intangible fixed assets for a significant amount nor are there intangible fixed assets in litigation or guarantees related to third parties.

8. Right of use assets and operating leases

8.1 Right of use assets

The detail of the right-of-use assets as well as the movement of the year ended December 31, 2019 is as follows:

	Lands	Offices	Transportation equipment	Total
First adoption of the IFRS 16 at 01.01.2019	176	1,223	183	1,582
Additions	2,799	584	33	3,416
Amortization	(95)	(301)	(38)	(434)
Accrued interests	-	-	-	-
Payments	-	-	-	-
Balance at 12.31.2019	2,880	1,506	178	4,564

"Land" includes rental agreements for the land upon which the Kosten, Duna & Huambos, and Quillagua parks are being built.

"Offices" includes the lease agreements for the office space in Spain and Chile.

"Transportation equipment" includes finance leases for certain vehicles.

8.2 Operating leases - Leases

To conduct its business, the Group leases the right to use certain goods from third parties, and other Daruan Group companies. The terms outlined in the main lease agreements were in force during 2019 and 2018, which do not fall under the scope of IFRS 16 because they are short-term contracts are as follows (Note 2.2):

Year ended December 31, 2019:

		Period expense		Renewal
Element	Due date	2019	Contingent payments	Year	Purchase option	Price revision
Office lease (Spain)	2020	108,000	b)	2019	N/A	2019
Office lease (Chile)	2019	25,441	b)	2016	N/A	-
Office lease (Peru)	2020	10,479	b)	2019	N/A	2019
Office lease (Argentina)	2020	7,469	b)	2019	N/A	2019
Apartment lease (Chile)	2020	11,342	b)	2019	N/A	2019
Apartment lease (México)	2019	9,857	b)	2018	N/A	-
Other	2020	8,677	b)	2019	N/A	-
Total		181,265

a) Monthly payments

b) IPC based

Year ended December 31, 2018:

		Period expense		Renewal
Element	Due date	2018	Contingent payments	Year	Purchase option	Price revision
Office lease (Spain)	2019	108,000	b)	2018	N/A	2019
Office lease (Chile)	2019	69,352		2016	N/A	2018
Office lease (Peru)	2019	24,938		2018	N/A	2019
Apartment lease (Chile)	2019	7,790		2018	N/A	2019
Apartment lease (México)	2019	21,798		2018	N/A	2019
Total		231,878

a) Monthly payments

b) IPC Based

During 2019 and 2018, the Group had the guarantees which were contractually mandated by lessors totaling 86,924 euros and 91,989 euros respectively (Note 9.2).

The breakdown of non-cancelable minimum future operating lease payments, broken down by installment date at year end 2019 and 2018, is as follows:

		2019		2018
		Between 1			Between 1
	1 year	and 5 years	+ 5 year	1 year	and 5 years	+ 5 year
Office lease (España)	108,000	-	-	108,000	-	-
Office lease (Perú)	10,479	-	-	10,479	-	-
Office lease (Argentina)	7,469	-	-	-	-	-
Apartment lease (Chile)	7,616	-	-	7,904	-	-
Apartment lease (México)	-	-	-	21,798	-	-
Other	16,870	-	-	-	-	-
Total	150,434	-	-	148,181	-	-

None of the goods leased by the Group were subleased to third parties during 2019 and 2018.

9. Financial assets

9.1 Investments in related companies

The breakdown and movements during 2019 and FY 2018 of balances recognized under this heading in the accompanying consolidated statement of financial position are as follows:

	Balance at 12.31.2017	Additions	Retirements	Balance at 12.31.2018	Additions	Retirements	Balance at 12.31.2019
Non-current investments
Equity instruments	- -	11,474 11,474	- -	11,474 11,474	- -	(11,474) (11,474)	- -
Current financial investments
Loans to companies	32,151	45,830	(32,151)	45,830	40,512	(45,830)	40,512
	32,151	45,830	(32,151)	45,830	40,512	(45,830)	40,512
Total	32,151	57,304	(32,151)	57,304	40,512	(57,304)	40,512

Equity instruments correspond to the participation that the Parent Company has in certain Group companies that in 2018 were not included in the consolidation scope because they did not have a significant interest. In fiscal year 2019 all these entities have been included in the consolidation perimeter.

Loans to companies correspond to loans granted to certain Group companies not included in the consolidation scope as they were inactive and not significant, including the tax related borrowings which some of the Group companies held with the Parent of the Daruan Group Holding, S.L. Group, the parent of the tax group (Note 20).

9.2 Other financial investments

The movements during year ended 2019 and FY 2018 of the different balances recognized under the headings for financial investments in the accompanying consolidated statement of financial position are as follows:

	Balance at 12.31.2017	Additions	Retirements	Balance at 12.31.2018	Additions	Retirements	Balance at 12.31.2019
Non-current investment Equity instruments Other financial assets	- 6,453	-	- (5,705)	- 748	102,067 (748)	- -	102,067 -
Security deposits and guarantees	84,387 90,840	7,602 7,602	- (5,705)	91,989 92,737	- 101,319	(5,065) (5,065)	86,924 188,991
Current financial investments
Loans to companies Other financial assets	- 147,345	2,236,465 130,707	- (154,214)	2,236,465 123,838	- 6,873,062	(2,236,465) (123,838)	- 6,873,062
	147,345	2,367,172	(154,214)	2,360,303	6,873,062	(2,360,303)	6,873,062
Total	238,185	2,374,774	(159,919)	2,453,040	6,974,381	(2,365,368)	7,062,053

"Equity instruments" correspond to the 34.02% investment made in AIE Renovables Nudo Villanueva de los Escuderos, A.I.E during the year with two partners, to build an electricity substation for use by different solar park partners. The above AIE was inactive at year-end 2019.

Current loans to companies at December 31, 2018 correspond to three loans which the subsidiary Grenergy Pacific Limitada granted to entities which left the Group at December 31, 2018 (GR Tineo S.p.A, GR Lingue S.p.A. y GR Guayacan S.p.A.). These loans were repaid in February 2019.

Other financial assets recognized under current assets at December 31, 2019 correspond to short-term deposits at financial entities which bear interest at market rates.

The breakdown on the other financial investments of the ended year December 31, 2019 is as the follow:

Year ended December 31, 2019:

	Fair value through	Loans and other
	profit or loss	financial assets	Total
Non-current investments
Equity instruments	102,067	-	102,067
Security deposits and guarantees	-	86,924	86,924
	102,067	86,924	188,991
Current financial investments
Other financial assets	-	6,873,062	6,873,062
	-	6,873,062	6,873,062
Total	102,067	6,959,986	7,062,053

Year ended December 31, 2019:

	Loans and other financial assets	Total
Non-current investments
Other financial assets	748	748
Security deposits and guarantees	91,989	91,989
	92,737	92,737
Current financial investments
Loans to companies	2,236,465	2,236,465
Other financial assets	123,838	123,838
	2,360,303	2,360,303
Total	2,453,040	2,453,040

In 2019 and 2018, no financial assets were reclassified from one heading to another, and no cessions or transfers took place.

During 2019 and 2018, financial assets with established maturities or which may be determined using remaining installments have a 5-year duration.

No financial assets were delivered or accepted as guarantees for operations during 2019 and 2018.

10. Inventories

The composition of inventories at the end of 2019 and 2018 is as follows:

	12.21.2019			12.31.2018
	Cost	Impairment losses	Balance	Cost	Impairment losses	Balance
Raw materials and other consumables Plant in progress Prepayments to suppliers	1,015,452 7,777,484 58,180	- - -	1,015,452 7,777,484 58,180	1,115,309 10,479,885 29,502	- - -	1,115,309 10,479,885 29,502
Total	8,851,116	-	8,851,116	11,624,696	-	11,624,696

At year-end 2019 and 2018, the Group recognized materials still not used in the solar plants under "Raw materials and other consumables" in the respective amounts of 1,015,452 and 1,115,309 euros.

Movements in inventories of raw materials and work in progress during 2019 and 2018 follow:

	12.31.2019	12.31.2018
Initial balance	11,595,194	9,647,193
Change in stocks of work in progress	(2,702,401)	1,009,770
Change in stocks of raw materials	(99,857)	938,231
Final balance	8,792,936	11,595,194

"Plants in progress" reflects a balance of 7,777,484 euros at December 31, 2019 (2018: 10,479,885 euros), which includes construction costs for two photovoltaic farms located in Chile (Quinta and Sol de Septiembre); there are sales agreements for both. During 2018, this heading included the construction costs for the Rovián, Doñihue, and Santa Rosa plants.

The Group has arranged insurance policies to cover the potential risks to which its inventories are exposed. The coverage of these insurance policies is considered sufficient.

In 2019 and 2018, there were no inventories with collateral granted as a guarantee.

11. Trade receivables for sales and services and client prepairments

This heading in the accompanying consolidated statement of financial position presents receivable balances from construction activities and sales of photovoltaic solar plants as well as income from operating and maintenance services in connection with photovoltaic solar plants.

At December 31, 2019, "Trade receivables for sales and services" mainly records the amounts pending collection for the sale of photovoltaic solar plants in the amount of 14,211 thousand euros (2018: 11,898 thousand euros). At December 31, 2019, of the aforementioned amount, 6,371 thousand euros correspond to invoices pending issue in connection with "work completed pending invoice" resulting from the positive difference between income recognized for each construction project and the amount invoiced for each such project (2018: 0 thousand euros), in accordance with the recognition criteria for income based on the degree of completion.

The Group signed share purchase-sale agreements in 2019 and 2018, which included termination clauses rendering the sale revocable. Amounts received in this regard were classified under "Customer advances" under current liabilities on the accompanying consolidated statement of financial position in the amounts of 8,651,083 and 5,839,755 euros, respectively.

The breakdown of sales to external customers invoiced amounts equal to or higher than 10% of net turnover during 2019 and 2018 is the following:

	Euros
Clients	2019	2018
AD CAPITAL TRALKA ENERGÍAS RENOVABLES	17,874,002	10,464,240
CARBONFREE CHILE, SPA	19,707,120	3,683,242
SONNEDIX	12,392,620	-
DE ENERGIA, SPA (DAELIM)	19,752,738	-
Total	69,726,480	14,147,482

At the closing of the interim period ended December 31, 2019 and the closing of FY 2018 there were no balances recognized as doubtful debts.

The entirety of balances reflected under this heading mature in the upcoming 12 months; the directors considered that the amount recognized on the accompanying statement of financial position is in line with fair value.

12. Cash and cash equivalents

The breakdown of this heading at the closing of the interim period ended 2019 and 2018 is as follows:

	Balance at 12.31.2019	Balance at 12.31.2018
Cash in hand	28,773,087	13,119,041
Total	28,773,087	13,119,041

Of the amounts shown in the table above, at December 31, 2019 and December 31, 2018, 1,243,653 euros and 7,098,860 euros, respectively, correspond to current accounts pledged for obtaining guarantees.

13. Capital and reserves

13.1 Share capital

At December 31, 2019 the Parent's share capital amounted to 8,507,177 euros corresponding to 24,306,221 shares with a nominal value of 0.35 euros each.

The shareholders in general meeting at June 17, 2019 agreed upon a capital increase of 4,861,244 euros with a charge to the Parent's voluntary reserves, via increase of the nominal value of already issued shares by 0.2 euros per share, resulting in a value of 0.35 euros per share.

Since 8 July 2015, the Parent's shares have been listed on the Alternative Stock Market, in the Expanding Companies segment ("MAB-EE"). As a result of the admission to listing on the MAB-EE, the company lost its status as a single-member company, which was declared in 2014. On 15 November 2019, the Parent's shareholders at the Annual General Meeting approved, a request for the delisting of its shares from the Alternative Stock Market and, simultaneously, a request for their admission to trading on the Barcelona, Bilbao, Madrid and Valencia Stock Exchanges and their inclusion in the Spanish Stock Market Interconnection System. As a result, the Board of Directors of Bolsas y Mercados Españoles, Sistemas de Negociación, S.A. resolved to delist the 24,306,221 shares of the Parent from the market, with effect from 16 December 2019, the same date on which the Parent's shares were admitted to listing on the Madrid, Barcelona, Bilbao and Valencia Stock Exchanges. As a previous step to delisting all the Parent's shares from the Spanish alternative equity market (MAB), and simultaneous admission to trading of the shares on the Madrid, Barcelona, Bilbao, and Valencia stock exchanges; Daruan Group Holding S.L.U. and certain minority shareholders placed a package of 2,429,000 shares on the market through an accelerated bookbuilding process, representing 10% of share capital.

At December 31, 2019 the following shareholders of the Parent held a direct stake of more than 10% of share capital:

Shareholder	No, of shares	Percentage of ownership interest
Daruan Group Holding, S.L.	16,539,590	68%

13.2 Share premium

The share premium amounted to 6,117,703 euros at December 31, 2019. This balance can be used for the same purposes as the voluntary reserves of the Parent, including conversion to capital.

13.3 Reserves

The consolidated statement of changes in equity which forms a part of these consolidated financial statements provides a breakdown of the aggregate balances and movements for the ended 2019 and 2018. The composition of the different line items are shown below:

	Balance at 12.31.2017	Increase	Decrease	Transfers	Balance at 12.31.2018	Increase	Decrease	Balance at 12.31.2019
Parent company reserves: Non distributable reserves
Legal reserve	729,187	-	-	-	729,187	-	-	729,187
Capitalization	315,027	-	-	20,194	335,221	204,237	-	539,458
Unrestricted reserves
Voluntary reserves	7,394,946	3,801,634	-	836,371	12,032,951	12,732,727	(7,124,981)	17,640,697
Total reserves of the Parent	8,439,160	3,801,634	-	856,565	13,097,359	12,936,964	(7,124,981)	18,909,342
Reserves in consolidated companies	(4,615,622)	1,473,192	(725,305)	(856,565)	(4,724,300)	2,771,589	(1,511,762)	(3,464,473)
Total	3,823,538	47,369	(3,279,488)	-	8,373,059	15,708,553	(8,636,743)	15,444,869

Legal Reserve

The Parent's legal reserve was appropriated in accordance with Article 274 of the Spanish Companies Law, which stipulates that 10% of income for each year must be transferred to the reserve until it represents at least 20% of the share capital.

It may not be distributed and if it is used to offset losses, in the event that no other reserves are available for this purpose, it must be replenished with future profits.

Voluntary Reserve

These reservations are freely available.

The profits or losses obtained from the purchase and sale of treasury stock are recorded directly in voluntary reserves. The increase in voluntary reserves for this item recorded in 2019 amounts to 2,110,720 euros (800,410 euros in 2018).

Capitalization Reserve

In 2017, the Parent Company Grenergy Renovables S.A. recognised, with a charge to the available reserves, the capitalisation reserve corresponding to 10% of the increase in equity for 2016, in accordance with Article 25 of Spanish Corporation Tax Law 27/2014 of 27 November (Note 20).

This reserve will be unavailable for a period of 5 years. In 2019 this reserve has been increased by 204,237 euros (20,194 euros in 2018) corresponding to 10% of the increase in equity for 2018

Reserve in fully consolidated companies

The detail of this caption in the accompanying consolidated statement of financial position by company is as follows:

Entities	12.31.19	12.31.18
GREENHOUSE RENEWABLE ENERGY S.L.	(299)	(137)
GREENHOUSE SOLAR ENERGY S.L.	(414)	(276)
GREENHOUSE SOLAR FIELDS S.L.	(576)	(414)
GUIA DE ISORA SOLAR 2 S.L.	(6,592)	(6,344)
GR SOLAR 2020 S.L.	(1,901)	(1,136)
GR SUN SPAIN S.L.	(2,505)	(2,502)
GR EQUITY WIND AND SOLAR S.L.	273,911	198,154
GR AITANA RENOVABLES S.L.	(593)	(593)
GR ASPE RENOVABLES S.L.	(620)	(620)
GR BANUELA RENOVABLES S.L.	(617)	(617)
GR TURBON RENOVABLES S.L.	(611)	(611)
GR TAKE RENOVABLES, S.L.U.	(391)	-
GR EUGABA RENOVABLES, S.L.U.	(368)	-
GR NEGUA RENOVABLES, S.L.U.	575	-
LEVEL FOTOVOLTAICA S.L.	(161,331)	(7,644)
EIDEN RENOVABLES, S.L.	(349)	(289)
CHAMBO RENOVABLES, S.L.	(349)	(289)
MAMBAR RENOVABLES, S.L.	(348)	(289)
EL AGUILA RENOVABLES, S.L.	(289)	(289)
GR RENOVABLES MEXICO S.A.	(1,504,405)	(1,112,855)
GRENERGY PERU SAC	(774,827)	(537,292)
GR PAINO SAC	121,848	91,052
GR TARUCA SAC	121,277	90,815
GRENERGY RENOVABLES PACIFIC, LTDA.	(870,146)	(3,321,746)
GRENERGY COLOMBIA SAS	(145,292)	(89,488)
FAILO 3, LTDA.	(9,214)	(1,601)
GRENERGY ATLANTIC S.A.	(100,758)	(3,616)
KOSTEN S.A.	116,313	(6,509)
GREEN HUB SA de CV	(513,212)	-
GR PACIFIC OVALLE, LTDA.	45,542	(9,164)
MESO 4 SOLAR SA de CV	(23,392)	-
CRISON 2 SOLAR SA de CV	(2,370)	-
ASTILO 1 SOLAR SA de CV	(26,641)	-
MIRGACA 6 SOLAR SA de CV	(400)	-
ORSIPO 5 SOLAR SA de CV	4,871	-
Total Entities	(3,464,473)	(4,724,300)

13.4 Treasury stock

On 19 May 2015, the Extraordinary General Meeting of Shareholders of the Parent Company Grenergy Renovables, S.A. unanimously agreed, in accordance with Article 146 of the Spanish Companies Act, to authorise the Company's Board of Directors to acquire, on one or more occasions, a maximum of 2,000,000 shares of the Company, at a maximum price of EUR 5 and a minimum of EUR 0.01 per share. The acquisition may be made by purchase, swap, donation, allotment, dation in payment and, in general, by any form of acquisition of the shares for consideration.

Therefore, in a share purchase deed dated 29 June 2015, the majority shareholder, Daruan Group Holding, S.L., agreed to transfer 520,000 shares to Grenergy Renovables, S.A., to form a treasury stock. The purchase price was determined to be the price set in the subscription offer for Grenergy Renovables, S.A.

In December 2019, the Parent signed a new liquidity agreement for the management of its treasury shares with Banco de Sabadell. The contract came into force on December 16, 2019 and has a term of twelve months.

The shares acquired as treasury stock are intended to meet the obligations arising from the contract signed with the liquidity provider, in compliance with the provisions of Circular 1/2017 of the National Securities Market Commission.

The Parent Company has allocated a total of 26,525 shares to the associated securities account and 500,000 euros to the cash account for the new liquidity contract.

Banco Sabadell will carry out the transactions covered by this contract, on the regulated markets and in the Spanish multilateral trading systems, through the order market, in accordance with the trading rules, as established in the CNMV Circular.

On 11 September 2018, the Parent Company acquired 365,426 treasury shares from persons related to the Company at a price of.

The treasury share portfolio at the year ended 2019 and 2018 is comprised of the following:

	Balance at 12.31.2019	Balance at 12.31.2018
No. of shares in treasury share portfolio	556,815	888,177
Total treasury share portfolio	3,328,497	2,062,970
Liquidity Account	2,423,479	1,198,776
Fixed Own Portfolio Account	905,018	864,194

During the year ended 2019 and FY 2018, the movements in the treasury sure portfolio of the Parent were as follows:

Year ended December 31, 2019

		Treasury shares
	Number of shares	Nominal amount	Average purchase / sales price
Balance at 12.31.2018	888,177	2,062,969	2.32
Acquisitions	389,978	3,882,063	9.95
Disposals	(721,340)	(2,616,535)	3.63
Balance at 12.31.2019	556,815	3,328,497	5.98

Year ended December 31, 2018:

	Treasury shares
	Number of	Nominal	Average purchase /
	shares	amount	sales price
Balance at 12.31.2017	741,577	1,133,498	1.55
Acquisitions	658,055	1,869,232	2.84
Disposals	(511,455)	(939,761)	1.84
Balance at 12.31.2018	888,177	2,062,969	2.32

The purpose of holding the treasury shares is to maintain them available for sale in the market and for the incentive plan approved for directors, executives, employees, and key collaborators of the Group (Note 13.5).

At December 31, 2019 treasury shares represent 2.3% (2018: 3.7%) of all the Parent's shares.

13.5 Employee incentive plan

At the meeting held on June 26, 2015, the Board of Directors of the Parent approved an incentive plan for certain executives and key personnel based on the granting of options on the Parent's shares. At December 31, 2019 the number of shares set aside for covering this plan totaled 22,000 shares. The exercise price of the share options was established as 1.38 euros per share.

The beneficiary will be able to acquire:

• A third of the shares granted for the option from the date on which two years have elapsed counting from the grant date.
• A third of the shares granted for the option from the date on which three years have elapsed counting from the grant date.
• A third of the shares granted for the option from the date on which four years have elapsed counting from the grant date.

At June 2, 2016 a second incentive plan was approved based on the granting of options on the Parent's shares with similar characteristics to the first one. At December 31, 2019 the number of shares set aside for covering this plan totaled 48,667 shares. The exercise price of the share options was established as 1.90 euros per share.

At November 27, 2018 a third incentive plan was approved based on the granting of options on the Parent's shares with similar characteristics to the previous two plans. At December 31, 2018 the number of shares set aside for covering this plan totaled 157,143 shares. The exercise price of the share options was established as 3.50 euros per share.

At March 29, 2019 a fourth incentive plan was approved based on the granting of options on the Parent's shares with similar characteristics to the previous three plans. At December 31, 2019 the number of shares set aside for covering this plan totaled 62,200 shares. The exercise price of the share options was established as 6.90 euros per share.

Said incentive plans establish that their settlement will be carried out by delivery of equity instruments to the employees should they exercise the options granted. The exercise prices of the options on shares were established by reference to the fair value of the corresponding equity instruments at the grant date. The Group did not recognize any amounts relating to this item since it considered that the fair value of the option price is not significant.

At December 31, 2019 there were 54,445 exercisable options (2018: 198,000). In 2019, 263,333 options were exercised.

13.6 Earnings (loss) per share

Basic

The basic earnings (losses) per share from continuing operations corresponding to the interim periods ended December 31, 2019 and December 31, 2018 were as follows:

	Euros
	12.31.2019	12.31.2018
Profit attributable to the partners of the Parent	11,436,955	9,725,962
Weighted average number of ordinary shares outstanding	23,583,725	23,491,344
Earnings (losses) per share	0.48	0.41

Basic earnings per share are calculated by dividing the profit attributable to the partners of the Parent by the weighted average number of ordinary shares outstanding during the year.

Diluted

There are no significant agreements for diluting basic earnings per share as calculated in the previous paragraph.

14. Unrealized gains/(losses) reserve

Hedge transactions

This corresponded to the fair value of hedging instruments contracted by the Group at December 31, 2019 (Note 17.5).

Currency translation differences

The detail of this heading of the consolidated statement of financial position attached by each company included in the consolidation scope is as follows:

	12.31.19	12.31.18
GR RENOVABLES MEXICO S.A. DE C.V.	54,857	135,885
GRENERGY GREENHUB S.A. DE C.V.	6,956	(48)
GRENERGY PERU SAC	(14,924)	7,743
GR PAINO SAC	123,481	(112,777)
GR TARUCA SAC	112,498	(112,382)
GRENERGY RENOVABLES PACIFIC, LTDA.	(640,845)	(116,367)
FAILO 3, LTDA.	6,522	634
GR COLOMBIA, SAS	27,766	9,788
PARQUE EÓLICO QUILLAGUA, SpA	(200,201)	-
GR PACIFIC OVALLE, LTDA.	(39,004)	(38,592)
ORSIPO 5 SOLAR	11,507	38
MESO 4 SOLAR	(1,383)	1,179
CRISON 2 SOLAR	136	26
ASTILO 1 SOLAR	(1,423)	263
MIRGACA 6 SOLAR	(27)	-
GR MOLLE SpA	-	746
GR BELLOTO SpA	-	746
GRENERGY OPEX, SpA	(2,527)	-
GRENERGY ATLANTIC S.A.	37,196	15,153
KOSTEN S.A.	66,522	(52,350)
Total	(452,893)	(260,315)

15. Non-controlling interests

The movement for each society is as follows:

Year ended December 31, 2019

		Changes in the consolidation			Currency translation
	12.31.2018	scope	Others	Result	differences	12.31.2019
GR. Renovables México, S.A.	(28,999)	-	1,071	(4,334)	(1,654)	(33,916)
Grenergy Perú SAC	(7,748)	-	-	(3,606)	(229)	(11,583)
GR Paino, SAC	-	13,539	-	3,847	13,720	31,106
GR Taruca, SAC	-	13,475	-	5,685	12,500	31,660
Grenergy Renovables Pacific, Ltda.	20	-	(118)	220	(20)	102
Failo 3, Ltda.	(8,581)	-	-	-	5,888	(2,693)
Grenergy Pacific Ovalle, Ltda.	(21,012)	-	21,153	(3)	(8)	130
Level Fotovoltaica S.L.	(161,331)	-	-	(2,447)	-	(163,778)
Meso 4 Solar	(453)	-	(1)	-	(52)	(506)
Crison 2 Solar	(48)	-	-	-	2	(46)
Astilo 1 Solar	(538)	-	(1)	-	(34)	(573)
Mirgaca 6 Solar	-	-	(8)	-	(1)	(9)
Total	(228,690)	27,014	22,096	(638)	30,112	(150,106)

Year ended December 31, 2018

	12.31.2017	Changes in the consolidation scope	Others	Result	Currency translation differences	12.31.2018
GR. Renovables Mexico, S.A.	(19,033)	-	(3,679)	(9,061)	2,773	(29,000)
Grenergy Perú SAC	(5,117)	-	(364)	(2,399)	132	(7,748)
Grenergy Renovables Pacific, Ltda.	(12)	-	2	41	(12)	19
Failo 3, Ltda.	(1,341)	-	(260)	(7,612)	634	(8,579)
Grenergy Pacific Ovalle, Ltda.	(225)	-	38	(20,038)	(788)	(21,013)
Level Fotovoltaica S.L.	(6,140)	-	(1,504)	(153,687)	-	(161,331)
Meso 4 Solar	-	-	-	(477)	24	(453)
Crison 2 Solar	-	-	-	(48)	1	(47)
Astilo 1 Solar	-	-	-	(544)	6	(538)
Grenergy Pan de Azúcar, Ltda. (*)	53,046	(53,046)	-	-	-	-
Total	21,178	(53,046)	(5,767)	(193,826)	2,770	(228,690)

(*) Entity sold in 2018

The balance shown in the consolidated income statement attached in the heading "Result attributed to non-controlling interests" represents the participation of minority shareholders in the consolidated results for the year.

16. Provisions and contingencies

The movements during the interim period ended December 31, 2019 and FY 2018 in the line items included under this heading in the accompanying consolidated statement of financial position were as follows:

	Provision for dismantling costs	Provision for delays and guarantees	Other provisions	Total
Balance at 12.31.2017	-	-	-	-
Allowances	-	64,150	-	64,150
Amounts used	-	-	-	-
Balance at 12.31.2018	-	64,150	-	64,150
Allowances	2,748,384	764,759	-	3,513,143
Amounts used	-	-	-	-
Balance at 12.31.2019	2,748,384	828,909	-	3,577,293

Provision for penalties

This relates to the estimate of the penalties incurred in the commercial operation of the Kosten wind farm in connection with the power supply agreement entered into with Compañía Administradora del Mercado Mayorista Eléctrico S.A. (CAMMESA). Under the aforementioned agreement, the Group undertook to have the wind farm completed and in commercial operation by 13 August 2019, but due to various circumstances and events, mainly the bankruptcy of the main subcontractor could not be completed. The contractually committed period has expired, and the Group estimates that commercial operation will take place in the first quarter of 2020. At December 31, 2019, the Group's directors and its internal and external legal advisors understood that the risk of meeting the penalties under the contract was probable and decided to record a provision for this item. The recognition of this provision had no impact on the consolidated income statement since the Group has executed guarantees in its favour covering this circumstance with the main subcontractor. Notwithstanding the foregoing, if CAMMESA finally decided to apply penalties for delay to Grenergy, the Group's directors consider that there are legal arguments based on reasons of force majeure that could determine that these penalties are unjustified and, therefore, the relevant claims would be made to avoid the outflow of resources from the Group.

Provision for delays and guarantees

At each year end the Group evaluates the need to recognize a provision for guaranteeing and covering any inconsistencies that may arise with respect to materials, supplies, and spare parts delivered as well as penalties due to delays in connecting solar plants. At December 31, 2019 and December 31, 2018 the Group had set aside provisions for these items based on the best estimates possible.

At December 31, 2019 and December 31, 2018 there were no provisions of a significant nature or contingent liabilities which had not been recognized or disclosed in the consolidated financial statements and the corresponding notes thereto.

Dismantling provision

The Group records a provision for dismantling at the end of the construction period of the solar and wind power plants. This provision is calculated by estimating the present value of the obligations assumed as a result of dismantling or retirement and others associated with the aforementioned asset, such as the costs of refurbishing the site on which the solar plants are located. At 31 December 2019 and 2018 the Group had not recognised any amount in this respect as it had no plants in operation.

17. Non-current and current borrowings

The breakdown of these consolidated statement of financial position headings at December 31, 2019 and December 31, 2018 is as follows:

	Non-current borrowings	Current borrowings	Total at 12.31.2018	Non-current borrowings	Current borrowings	Total at 12.31.2019
Obligations and tradeable values	-	-	-	21,539,686	-	21,539,686
Bank borrowings Loans	9,333,447 9,333,447	6,061,848 2,799,001	15,395,295 12,132,448	41,764,740 41,764,740	4,953,157 3,633,730	46,717,897 45,398,470
Credit facilities	-	2,424,089	2,424,089	-	24,435	24,435
Foreign financing	-	838,758	838,758	-	1,294,992	1,294,992
Other financial liabilities	266,535	1,244,074	1,510,609	208,249	3,342,401	3,550,650
Derivatives	-	-	-		654,429	654,429
Finance lease liabilities	134,854	27,662	162,516	3,726,447	692,217	4,418,664
Total	9,734,836	7,333,584	17,068,420	67,239,122	9,642,204	76,881,326

The only liabilities that are measured at fair value are derivative financial instruments. These were measured using cash flow discounts (see Note 4.9).

The fair value of the other financial assets and liabilities does not differ significantly from the amount at which they are recognised.

At December 31, 2019 and December 31, 2018, the breakdown of borrowings by residual maturities is as follows:

Year ended December 31, 2019

	Obligations and tradeable values	Bank borrowings	Other borrowings	Derivatives	Finance lease liabilities	Total
Until 12.31.2020	-	4,953,157	3,342,401	654,429	692,217	9,642,204
Until 12.31.2021	-	5,979,643	52,060	-	515,209	6,546,912
Until 12.31.2022	-	5,250,801	156,189	-	553,070	5,960,060
Until 12.31.2023	-	5,448,398	-	-	482,268	5,930,666
Until 12.31.2024	21,539,686	5,855,502	-	-	473,019	27,868,207
More than 5 periods	-	19,230,396	-	-	1,702,881	20,933,277
Total	21,539,686	46,717,897	3,550,650	654,429	4,418,664	76,881,326

Year ended December 31, 2018

	Bank borrowings	Other borrowings	Finance lease liabilities	Total
Within one year	6,061,848	1,244,074	27,662	7,333,584
Until 2020	2,618,644	52,060	27,688	2,698,392
Until 2021	1,271,276	52,060	23,168	1,346,504
Until 2022	453,627	52,060	80,887	586,574
Until 2023	453,627	52,060	3,111	508,798
More than 5 periods	4,536,273	58,295	-	4,594,568
Total	15,395,295	1,510,609	162,516	17,068,420

During 2019 and 2018 the Group complied with the payment of all amounts of its financial debt at maturity. Likewise, at the date of authorization of these consolidated financial statements the Group had complied with all related obligations assumed.

17.1 Bonds and other marketable debt securities

In October 2019, the Parent's Board of Directors agreed to establish the "2019 Grenergy fixedincome renewable energy program;" the Company may issue fixed-income securities in the short and long term in a maximum nominal amount of up to 50,000,000 euros. During October, 2019, the corresponding prospectus reported admission to trading on the Alternative Fixed-Income Market (MARF), to incorporate bonds issued within the framework of the "2019 Grenergy fixed-income renewable energy program" during its validity period (1 year commencing the date of inclusion of the prospectus for the admission for trading to MARF).

In November 2019, the Parent issued bonds under the above program in the nominal amount of 22,000,000 euros at a 4.75% interest rate, maturing in November 2024. Accrued interest in the year amounted to 174 thousand euros.

At year end, the Group was in compliance with its bond-issue covenants.

Bank borrowings

The breakdown of loans subscribed and their main contractual conditions at December 31, 2019 and December 31, 2018 is as follows:

Year ended December 31, 2019

					Euros
Financial institution	Maturity date	Interest rate	Type of	Installments	Non-current liabilities	Current liabilities	Total
Banco Sabadell	10/20/2021	2.50%	Corporate	Monthly	534,031	609,693	1,143,724
Banco Sabadell (USD)	04/19/2021	3.60%	Corporate	Monthly	297,229	891,687	1,188,916
Banco Santander	04/10/2020	2.15%	Corporate Project /	Quaterly	-	673,827	673,827
KFW Bank (USD) CAF-Banco de Desarrollo	07/31/2034	5.00%	corporate guarantee	Semi-annual	22,961,222	1,458,523	24,419,745
de América Latina & ICO			Project /
(USD)	04/30/2036	6.79%	corporate guarantee Project /	Semi-annual	8,119,074		8,119,074
Sinia Capital (USD)	11/30/2035	9.50%	corporate guarantee	Semi-annual	-	-	-
Banco Security, Banco del Estado de Chile y Penta
Vida Compañía de			Project /
Seguros de Vida (USD)	11/08/2036		corporate guarantee Project /	Semi-annual	-	-	-
Sinia Capital (USD)	11/08/2036		corporate guarantee	Semi-annual	9,808,555	-	9,808,555
Total					41,764,740	3,633,730	45,398,470

					Euros
Financial institution	Maturity date	Interest rate	Type of	Installments	Non current liabilities	Current liabilities	Total
			Project /
KFW BANK (USD)	07/31/2034	5.00%	corporate guarantee	Semi-annual	6,350,782	-	6,350,782
BANCO SABADELL	10/20/2021	2.50%	Corporate	Monthly	1,143,724	602,127	1,745,851
BANCO SABADELL (USD)	04/19/2021	3.60%	Corporate	Monthly	1,165,114	870,701	2,035,815
BANCO SANTANDER	04/10/2020	2.15%	Corporate	Quaterly	673,827	1,326,173	2,000,000
Total					9,333,447	2,799,001	12,132,448

The three loans backed by corporate guarantees with Banco Sabadell and Banco Santander were arranged to bolster the Group's cash position in the event of upcoming investments in developing projects, and ensuring that Grenergy has sufficient liquidity to carry out its business plan. The abovementioned loans are not subject to covenants, apart from that related to the Kosten project. Interest rates range from 2.15%-3.60%, maturing in between 2 and 5 years.

Project finance

In 2019 the Group had 4 project finance arrangements in the approximate total amount of 127 million euros:

• (i) project finance granted by KFW Bank to the subsidiary Finanduero GR Kosten, S.A.U. to build and operate the Kosten wind farm (24 MW) in Argentina;
• (ii) another two granted by Banco de Desarrollo de América Latina, by Spain's Instituto de Crédito Oficial (ICO), and Sinia Capital, S.A.C.V. to the subsidiary GR Taruca, S.A.C. as lender for building and operating the Duna wind farm, to the subsidiary GR Paino, S.A.C. For construction and operation of the Huambos wind farm, both located in Peru, one of which featuring a capacity of 18 MW, and
• (iii) A project finance granted by Banco Security, Banco del Estado de Chile, Penta Vida Compañía de Seguros de Vida, and Sinia Renovables, S.A.U.to the subsidiary Parque Eólico Quillagua, SpA as lender for construction and operation of the Quillagua 103 MW-capacity solar plant.

Kosten project

The project finance agreement with KFW Bank corresponds to a senior financing contract with a maximum principal amount of 31.7 million US dollars (28.3 million euros at the 2019 exchange rate) maturing on July 31, 2034 and repayable in semi-annual installments at an interest rate of 5%. At year end, the Group was in compliance with its bond-issue covenants. There are certain associated guarantees related to the Company's properties requiring compliance with certain commitments.

Duna & Huambos Project

An addition, during the construction of the Duna and Huambos wind farms, several syndicated loan agreements were arranged during March 2019 in the maximum amount of \$36.8 million (2018: 32.8 million euros at the year-end exchange rate), maturing on March 31, 2037 with CAF-Banco de Desarrollo de América Latina and Spain's Instituto de Crédito Oficial (ICO), with an all-in 6.79% interest rate. Both contracts are mezzanine loans (subordinated to senior financing) totaling \$6 million (2019 exchange rate: 5.3 million euros), maturing on November 30, 2035, with Sinia Capital, S.A. de C.V. at a 9.50% interest rate. There are certain associated guarantees related to the Company's properties requiring compliance with certain commitments.

Quillagua project

In November of the year, the Group arranged financing in the amount to \$60.3 million (yearend 2019 exchange rate: 54.8 million euros) with Banco Security, Banco del Estado de Chile, and Penta Vida Compañía de Seguros de Vida, to build a solar farm with 103 MW capacity in Quillaga, and an estimated output of 301 gigawatts/hour. This park is slated for connection during the third quarter of 2020. The structure is project finance, encompassing financing of the senior debt within 17 years. Sinia Renovables, SAU, is wholly owned by Banco de Sabadell, S.A., which also participates in financing the abovementioned solar farm thanks to a mezzanine loan in the amount of \$11 million (2019 exchange rate: 9.8 million euros). There are certain associated guarantees related to the Company's properties requiring compliance with certain commitments.

17.2 Credit facilities and discount lines

At December 31, 2019 and December 31, 2018 the Group had subscribed credit facilities and credit financing for foreign operations with various financial entities. The breakdown of these items at said dates and their contractual terms are as follows:

		Euros
Financial institution	Maturity	Credit limit	Amount drawn	Drawable amount
BANKIA I	05/27/2020	100,000	-	100,000
BANKIA II	04/21/2020	1,500,000	-	1,500,000
SANTANDER	04/17/2020	300,000	-	300,000
SANTANDER II (ANTES POPULAR)	05/07/2020	200,000	-	200,000
SABADELL	05/10/2020	200,000	23,102	176,898
BANKINTER	Indefinite	500,000	-	500,000
BANKIA (VISA)	Indefinite	3,000	-	3,000
BANCO SABADELL (VISA)	Indefinite	30,000	-	30,000
SECURITY (VISA)	Indefinite	8,000	1,333	6,667
Total credit facilities		2,841,000	24,435	2,816,565
SABADELL (USD)	Indefinite	13,500,000	67,554	2,886,110
SANTANDER (USD)	Indefinite	11,750,000	-	7,024,020
BANKIA (USD)	05/27/2020	11,000,000	1,227,438	3,218,843
BANKINTER (USD)	Indefinite	11,000,000	-	5,531,739
CAIXABANK (USD)	01/23/2021	5,000,000	-	2,985,581
BBVA (USD)	03/01/2020	5,000,000	-	-
Total foreign financing		57,250,000	1,294,992	21,646,293
Total		60,091,000	1,319,427	24,462,858

Year ended December 31, 2019:

Year ended December 31, 2018:

			Euros
Financial institution	Maturity	Credit limit	Amount drawn	Drawable amount
BANKIA I	09/07/2019	100,000	93,524	6,476
BANKIA II	04/21/2019	1,500,000	1,494,422	5,578
SANTANDER	04/14/2019	300,000	281,761	18,239
POPULAR	10/26/2019	200,000	189,852	10,148
SABADELL	05/25/2019	200,000	80,203	119,797
BANKINTER	07/28/2019	300,000	271,616	28,384
BANKIA (VISA)	Indefinite	3,000	-	3,000
BANCO SABADELL (VISA)	Indefinite	30,000	12,711	17,289
Total credit facilities		2,633,000	2,424,089	208,911
SABADELL (USD)	Indefinite	6,500,000	250,952	6,064,509
SANTANDER (USD)	Indefinite	6,000,000	-	2,959,432
BANKIA (USD)	09/07/2019	6,000,000	587,806	2,336,537
POPULAR (USD)	10/26/2019	2,000,000	-	2,000,000
BANKINTER (USD)	07/28/2019	6,500,000	-	6,500,000
CAIXABANK (USD)	01/23/2019	5,000,000	-	5,000,000
BBVA (USD)	07/12/2019	3,000,000	-	1,994,369
Total foreign financing		35,000,000	838,758	26,854,847
Total		37,633,000	3,262,847	27,063,758

The average annual interest rate on the credit facilities during 2019 was 2.15%.

17.3 Other borrowings

At December 31, 2019 and December 31, 2018 the breakdown of other borrowings held by the Group was as follows:

Year ended December 31, 2019:

					Euros
			Type of		Non-current	Current
Financial institution	Maturity	Interest rate	guarantee	Installments	liabilities	liabilities	Total
CDTI	12/05/2022	No interest	No	Monthly	208,249	52,060	260,309
Ministerio de Economía
y Competitividad	20/01/2021	No interest	No	Monthly	-	6,226	6,226
Other borrowings
(Kosten)	-	-	-	-	-	1,169,001	1,169,001
Other borrowings (PEQ)	-	-	-	-	-	2,113,810	2,113,810
Other	-	-	-	-	-	1,304	1,304
Total					208,249	3,342,401	3,550,650

Year ended December 31, 2018:

					Euros
			Type of		Non-current	Current
Financial institution	Maturity	Interest rate	guarantee	Installments	liabilities	liabilities	Total
CDTI	12/05/2022	No interest	No	Monthly	260,308	52,060	312,368
Ministerio de Economía y
Competitividad	20/01/2021	No interest	No	Monthly	6,227	5,926	12,153
Other borrowings	-	-	-	-	-	1,186,088	1,186,088
Total					266,535	1,244,074	1,510,609

This heading corresponds to the following:

· Amount pending payment at year end which was generated by the purchase of Kosten S.A., and integrated into the Group during 2017.

• · Amount pending payment at year end which was generated by the purchase of Parque Eólico Quillagua SpA, and integrated into the Group in 2019 (Note 5).
• · The balance relating to CDTI corresponds to the amount pending repayment at the end of the period of a zero interest loan granted by the CDTI on October 13, 2011 in the amount of 520,609 euros in order to help financing the necessary investments for the project known as "Design and Modeling of a forecasting system for performance and integral control at energy distribution installations."
• · Further, the Parent received a zero interest rate loan granted by the Ministry of Economy and Competition on April 16, 2012 in the amount of 33,756 euros relating to the personnel expenses for carrying out the project known as "Design and Modeling of a forecasting system for performance and integral control at energy distribution installations."

The repayment of these loans can be extended over a maximum period of seven yearly installments at identical amounts, allowing a maximum maturity for the first annual installment of five years counted from the date on which they were granted. The first of said annual installments fell due for the year 2015.

17.4 Derivatives

Derivative financial instruments during the year corresponded to two interest rate swaps established to mitigate the effects of Libor 6-month fluctuations upon which finance charges on bank borrowings are established to finance construction of the solar park indicated under Quillagua's "PP&E under construction." The notional amounts and fixed rates on the above during 2019 follow:

Farm	Financial entity	Notional a 12.31.2019	Fixed rate
Quillagua	Banco Security	11,207,946	6.452%
Quillagua	Banco del Estado de Chile	11,207,946	6.452%

Under the terms of the swap, twice a year, the Group pays monthly interest at a fixed rate of 6.452% and receives interest at a floating rate of 6-month Libor. The swap was designated as a cash flow hedge of the interest rate risk associated with the mortgage loan granted by Banco Security and Banco del Estado de Chile. The terms of the hedging instrument and the covered instrument are the same, and thus it is considered an effective hedge.

17.5 Finance lease liabilities

Commencing January 1, 2019, due to the application of IFRS 16 "Leases," lease liabilities are contemplated under "Financial debt" (Note 2.2). The chief liabilities recognized during 2019 under this heading on the consolidated statement of financial position are:

	Lands	Offices	Transportation equipment	Total
Long-term finance lease liabilities	2,521	1,074	132	3,727
Short-term finance lease liabilities	306	353	33	692
TOTAL (Thousands euros)	2,827	1,427	165	4,419

"Land" includes lease liabilities from the rental agreements for the land upon which the Kosten, Duna & Huambos, and Quillagua parks are being built.

"Offices" includes lease agreements for the office space in Spain and Chile.

"Transportation equipment" includes finance leases for certain vehicles.

18. Borrowings from related companies

As at 31 December 2019, there were no debts to related companies.

The breakdown of these headings in the accompanying consolidated statements of financial position at ended 2019 and December 31, 2018 is as follows:

Year ended December 31, 2019:

	Maturity date	Interest rate	Type of guarantee	Non-current borrowings	Current borrowings	Total at 12.31.19
Borrowings from related companies Loan debt Tax related debt	Indefinite -	Euribor 12 months + 2% -	- -	- -	17,033 316,736	17,033 316,736
Total			-	-	333,769	333,769

The above table shows the debt owed Daruan Group Holding, S.L. at the closing of the interim period ended December 31, 2019 and the closing of FY 2018, amounting to 17 thousand euros.

The Group files its corporate tax return as part of the tax group comprised of all companies which fulfill the requirements established in Chapter VI of Title VII of Law 27/2014 of November 27, on Corporate Income Tax, with Daruan Group Holding, S.L. as the parent of said tax group. Thus, a related debt of 317 thousand euros owed to this company was recorded at December 31, 2018. As discussed in Note 20, in 2019 the Parent and the other subsidiaries ceased to belong to the Daruan Group Holding, S.L. and Subsidiaries tax group.

19. Disclosure of deferrals of payment to suppliers

The total amount of payments made during the year, with details of periods of payments, according to the maximum legal limit under Law 15/2010 of 5 July, which laid down measures against slow payers in Spain, is as follows:

	2019	2018
	Days	Days
Average supplier payment period	52.92	62.56
Transactions paid ratio	60	69
Transactions pending payment ratio	43	45
	Euros	Euros
Total transactions paid	26,556,384	23,053,948
Total transactions pending payment	18,961,836	8,445,984

20. Public administrations and tax matters

The breakdown of balances with public administrations at December 31, 2019 and December 31, 2018 is as follows:

Receivable from public administrations	Non current	Current	Balance at 12.31.19	Non current	Current	Balance at 12.31.18
Deferred tax assets	3,497,950	-	3,497,950	956,594	-	956,594
Current tax assets	-	16,112	16,112	-	-	-
Other receivables from Public Administrations	-	12,146,960	12,146,960	-	2,091,851	2,091,851
Tax return receivables	-	1,577,972	1,577,972	-	714,533	714,533
Tax receivables VAT	-	10,568,988	10,568,988	-	1,377,318	1,377,318
Total	3,497,950	12,163,072	15,661,022	956,594	2,091,851	3,048,445

Payable to public administrations	Non current	Current	Balance at 12.31.19	Non current	Current	Balance at 12.31.18
Deferred tax liabilities	3,450,112	-	3,450,112	-	-	-
Current tax liabilities	-	730,798	730,798	-	-	-
Other payables to public administrations	-	1,370,551	1,370,551	-	299,458	299,458
VAT payable	-	977,065	977,065		128,172	128,172
Payable to the public treasury for withholdings	-	329,274	329,274		129,526	129,526
Social security agencies	-	64,212	64,212		41,760	41,760
Total	3,450,112	2,101,349	5,551,461	-	299,458	299,458

Tax situation

In accordance with current legislation in the countries in which Group companies are located, taxes cannot be considered definitive until they have been inspected by the tax authorities or the corresponding inspection period has elapsed.

Due to the varying interpretations of the tax regulations applicable, certain tax contingencies that are not objectively quantifiable could arise. Nevertheless, the Parent's Directors considers that tax debts arising from possible future actions taken by the tax authorities corresponding to each of the Group companies would not have a significant effect on the consolidated financial statements taken as a whole.

Income tax

The Spanish companies of the Grenergy Group file their tax returns under a consolidated tax regime since 2012, together with other companies of the Daruan Group. During 2012 and 2013 the parent of the tax group was Daruan Venture Capital, S.C.R., and since 2014 the new parent of the tax group has been Daruan Group Holding, S.L. As discussed in Note 13.1, in 2019 the Parent and its Spanish subsidiaries left the tax group.

The reconciliation between consolidated accounting profit and income tax, based on each company's individual information, is as follows:

Year ended December 31, 2019

Income statement
Increase	Decrease	Total
279,710 283,771	(1,593) (360) (238,442)	14,099,760 278,117 283,411 (238,442)
		14,422,846 4,182,625
		(1,519,182) 2,663,443

(*) Mainly corresponds to consolidation adjustments arising from the elimination of unrealized internal third-party margins.

Year ended December 31, 2018

	Income statement
	Increase	Decrease	Total
Profit/(loss) before tax			10,927,936
Permanent differences	189,300	(2,853)	186,447
Temporary differences	86,323	(427,415)	(341,092)
Capitalization Reserve		(62,261)	(62,261)
Tax base (fiscal result)			10,711,030
Gross tax calculated at average tax rate			3,106,198
Expenditure / (Income) for tax associated with consolidation adjustments (*)			(1,710,720)
Expense (Income) on earnings			1,395,478

(*) It corresponds mainly to consolidation adjustments due to the elimination of unrealized internal margins against third parties.

The composition of (expenditure) / income on earnings for the 2019 and 2018 fiscal years is as follows:

	12.31.2019	12.31.2018
GRENERGY RENOVABLES, S.L.	(1,846,941)	(1,642,516)
GREENHOUSE RENEWABLE ENERGY S.L.	38	54
GREENHOUSE SOLAR ENERGY S.L.	38	46
GREENHOUSE SOLAR FIELDS S.L.	38	54
GR RENOVABLES PACIFIC LTDA	(549,801)	(305,688)
PARQUE EÓLICO QUILLAGUA, SPA	(191,909)	-
GRENERGY OPEX, SPA	(29,353)	-
GUIA DE ISORA SOLAR 2 S.L.	97	83
GR SOLAR 2020 S.L.	1	255
GR SUN SPAIN S.L.	-	1
GR TARUCA SAC	(22,291)	(14,064)
GR PAINO SAC	(14,463)	(14,162)
GR TAKE RENOVABLES, S.L.U.	(104)	-
GR EUGABA RENOVABLES, S.L.U.	(97)	-
GR NEGUA RENOVABLES, S.L.U.	133	-
GR PERÚ SAC	(38,855)	-
GRENERGY COLOMBIA, SAS	31,907	-
GR TINEO SPA	-	89,897
GR GUAYACAN SPA	-	81,144
GR LINGUE SPA	-	188,798
KOSTEN SA	-	221,708
GREEN HUB SA de CV	-	(1,519)
ORSIPO 5 SOLAR	-	(349)
GR EQUITY WIND AND SOLAR S.L.	(1,881)	780
Total	(2,663,443)	(1,395,478)

The tax rates change according to the different locations, the main ones being the following for the year 2019 and 2018:

Country	Tax rate
Spain	25%
Chile	27%
Peru	29.50%
Argentina	35%
Mexico	30%
Colombia	33%

Deferred tax assets and liabilities

The difference between tax expense for the year and those previous, and that which is already paid or is payable during the periods recognized under "Deferred tax assets" or "Deferred tax liabilities," as appropriate. The above deferred tax assets were calculated by applying the prevailing nominal tax rate to the amounts.

The detail of this line item in the accompanying consolidated statement of financial position at December 31, 2019 and 2018 is as follows:

		Registered in profit and loss account			Registered in profit and loss account
	Balance at 12.31.2017	Additions	Retirements	Balance at 12.31.2018	Additions	Business combinations	Retirements	Balance at 12.31.2019
Deferred tax assets Pending negative tax base	402,743 -	836,956 247,987	(283,105) -	956,594 247,987	742,802 -	1,934,343 1,934,376	(135,789) (135,789)	3,497,950 2,046,574
Pending tax deductions Temporary differences Deferred tax liabilities	- 402,743 463,446	33 588,936 -	- (283,105) (463,448)	33 708,574 -	- 742,802 344,032	(33) 3,107,111	- - (1,031)	- 1,451,376 3,450,112
Permanent differences Temporary differences Total	- 463,446 (60,703)	- 836,956	- (463,446) 180,341	- - 956,594	- 344,032 398,770	- 3,107,111 (1,172,768)	- (1,631) (134,758)	- 3,450,112 47,838

Deferred tax assets arising from business combinations correspond to the tax base of the subsidiary Parque Eólico Quillagua, SpA at the date it joined the Group (Note 5).

Deferred tax liabilities on business combinations correspond to the measurement at fair value of the assets acquired from the Kosten y Parque Eólico Quillagua business combinations (Note 5).

The recoverability of deferred tax assets is assessed during recognition and at least at year end, in accordance with Group results during upcoming years.

Negative tax base pending compensation

At the end of the 2019 and 2018 financial years, the negative tax bases pending compensation by company is as follows:

Thousands Euros	12.31.2019	12.31.2018
LEVEL FOTOVOLTAICA, S.L.	323	322
GR PACIFIC OVALLE, LTDA.	1,017	1,017
GRENERGY PERU SAC	783	765
GR RENOVABLES MEXICO S.A.	1,559	1,417
GRENERGY COLOMBIA SAS	145	137
GRENERGY ATLANTIC S.A.	101	101
FAILO 3, LTDA.	18	15
PARQUE EÓLICO QUILLAGUA, SpA	7,164	-
KOSTEN SA	477	856
Total	11,587	4,630

The above table indicates that during 2018, the only tax loss carryforwards correspond to the subsidiaries Kosten, S.A. and Parque Eólico Quillagua, SpA. The recovery of these tax credits is reasonably assured because they do not have a maturity date and correspond to companies that are estimated to have recurring profits in the future when they enter into operation.

21. Income and expenses

Cost of Sales

The breakdown of the consolidated balance recognized under this heading by sector of activity is as follows:

	12.31.2019			12.31.2018
	Purchases	Changes in stocks	Total applied	Purchases	Changes in stocks	Total applied
Consumption of goods for release Subcontracted work	62,674,701 13,507	(99,857) -	62,574,844 13,507	20,764,986 357,858	938,231 -	21,703,217 357,858
Total	62,688,208	(99,857)	62,588,351	21,122,844	938,231	22,061,075

The breakdown of the purchases recorded in the accompanying consolidated income statement is as follows:

	12.31.2019	12.31.2018
Spain	8,557,104	6,515,023
Imports	54,131,104	14,607,821
Total	62,688,208	21,122,844

Social security costs

The breakdown of this heading in the consolidated income statement at 2019 and 2018 is as follows:

	12.31.2019	12.31.2019
Social security payable by the Company Other social security expenses	707,907 64,912	386,673 39,346
Total	772,819	426,019

The Group's average number of employees during ended 2019 and 2018 by professional category is as follows:

Category	2019	2018
Board members and Senior management	6	4
Department directors	16	15
Other	64	64
Total	86	83

The breakdown by gender of employees, directors, and senior management at 2019 and 2018 is as follows:

	12.31.2019		12.31.2018
Category	Male	Female	Total	Male	Female	Total
Senior management	6	3	9	4	1	5
Department Directors	13	4	17	11	4	15
Other	95	29	124	67	24	91
Total	114	36	150	82	29	111

The Group had no employees under contract with disabilities greater than or equal to 33% during 2019 or 2018.

External services

The breakdown is as follows:

	2019	2018
Lease payments (Note 8.2)	150,434	821,376
Repairs and maintenance	155,891	90,043
Independent professional services	1,966,538	1,448,089
Transports	10,533	10,936
Insurance premiums	188,951	146,951
Bank services	269,910	77,585
Publicity, advertising and public relations	156,531	37,263
Supplies	168,216	65,644
Other services	961,074	701,601
Total	4,028,078	3,399,488

"Professional services" reflects 551 thousand euros corresponding to the expenses incurred when the Parent applied for admission to trading on the Barcelona, Bilbao, and Valencia stock exchanges, and inclusion on Spain's Alternative Stock Market.

"Other" mainly includes expenses incurred when changing offices in Spain and Chile during 2019, as well as personnel travel expenses during 2019 and 2018.

Finance income and expenses

The breakdown of finance income and expenses recognized in the accompanying consolidated income statement is as follows:

	12.31.2019	12.31.2018
Income	55,019	-
Interest from other financial assets	55,019	-
Expenses	(1,141,769)	(1,559,392)
Interest on borrowings	(1,141,769)	(1,559,392)
Currency translation differences	(2,307,056)	(2,798,088)
Impairment and gains or losses on disposal of financial instruments	(25,000)	(122,714)
Impairment losses	(25,000)	(122,714)
Finance cost	(3,418,806)	(4,480,194)

Negative exchange differences during 2019 chiefly arose due to the sharp depreciation in the Argentine peso vs. the US dollar, due to balances receivable from Argentina's public bodies.

Negative exchange differences in 2018 mainly correspond to the pronounced depreciation of the Chilean peso with respect to the US dollar.

Profit (loss) by company

The contributions to consolidated profit attributable to the Parent for 2019 and 2018 (in euros) by each company included in the consolidation scope are as follows:

Entities	12.31.2019	12.31.2018
GRENERGY RENOVABLES, S.A.	12,495,751	15,216,857
GREENHOUSE RENEWABLE ENERGY S.L.	(113)	(217)
GREENHOUSE SOLAR ENERGY S.L.	(113)	(184)
GREENHOUSE SOLAR FIELDS S.L.	(113)	(217)
GUIA DE ISORA SOLAR 2 S.L.	(296)	(332)
GR SOLAR 2020 S.L.	(3)	(1,021)
GR SUN SPAIN S. L.	-	(4)
GR EQUITY WIND AND SOLAR S.L.	13,219	74,628
LEVEL FOTOVOLTAICA S.A.	(2,447)	(153,687)
EDEN RENOVABLES, S.L.	-	(60)
CHAMBO RENOVABLES, S.L.		(60)
MAMBAR RENOVABLES, S.L.	-	(60)
GR TAKE RENOVABLES, S.L.U.	311	-
GR EUGA BA RENOVABLES, S.L.U.	292
GR NEGUA RENOVABLES, S. L. U.	(399)	-
GR RENOVABLES MEXICO S.A.	(212,345)	(443,974)
GREEN HUB SA de CV	(30,483)	(513,212)
GRENERGY PERU SAC	(357,050)	(237,535)
GR PAINO SAC	34,624	44,335
GR TARUCA SAC	51,164	43,937
GRENERGY RENOVABLES PACIFIC, LTDA.	2,018,453	(772,437)
GRENERGY OPEX, SpA	73,471	-
PARQUE EDLICO QUILLAGUA, SpA	(162,493)	-
GRENERGY COLOMBIA SAS	16,966	(55,804)
GRENERGY ATLANTIC S.A.	(266,344)	(97,142)
KOSTEN S.A.	(2,130,535)	122,822
FAILO 3, LTDA.	-	(7,612)
GR HUINGAN SPA(**)	-	(11,472)
GR PACIFIC OVALLE LTDA. GR MOLLE SPA (*)	(146) (16,388)	(981,841) (21,060)
GR BELLOTO SPA (*)	(24,890)	(25,209)
GR TAMARUGO SPA (*)	(27,472)	-
GR GUINDO SPA	(21,366)	-
GR SAUCE SPA	(13,505)	-
MESO 4 SOLAR	-	(23,392)
CRISON 2 SOLAR	-	(2,370)
AST1L0 1 SOLAR	-	(26,641)
ORSIPO 5 SOLAR	(795)	4,871
GR LAUREL SPA(**)	-	(316,549)
GR AVELLANO SPA(**)		(3,879)
GR UTRE SPA(**)		(853,771)
GRARRAYAN SPA (**)	-	(21,554)
GR TINED SPA(**)		(227,945)
GR GUAYACAN SPA(**)	-	(205,308)
GR LINGUE SPA(**)	-	(488,239)
GR QUILLAY SPA(**)	-	(13,312)
GR ALERCE SPA(**)		(13,602)
GR PALMA SPA(**)	-	(19,082)
GR LILEN SPA(**)		(31,891)
GR MELI SPA(**)	-	(411)
GR CHAQUIHUE SPA(*)	-	(103,787)
GR PACIFIC PAN DE AZOCAR, LTDA.(**)	-	(106,614)
Total Entities	11,436,955	9,725,962

(*) Out of consolidation scope at 12.31.2019

(**) Out of consolidation scope at 12.31.2018

22. Foreign currency

Transactions performed with foreign currency in 2019 and 2018 follow:

Year ended December 31, 2019

	12.31.2019
	Value in euros
	American	Chilean Peruvian Mexican Argentinian Colombian
	Dollars	peso	soles	peso	peso	peso	Total
Sales revenue	70,931,791	-	-	-	-	-	70,931,791
Revenue from services rendered	-	1,120,742	-	-	-	-	1,120,742
Total	70,931,791	1,120,742	-	-	-	-	72,052,533
Purchases	(39,809,633)	(14,321,471)	-	-	-	-	(54,131,104)
Work carried out by other companies	-	(13,507)	-	-	-	-	(13,507)
Reception of services	(255,377)	(1,028,145)	(188,018)	(79,423)	-	(17,533)	(1,568,496)
Total	(40,065,010)	(15,363,123)	(188,018)	(79,423)	-	(17,533)	(55,713,107)

Year ended December 31, 2018

	12.31.2018
	Value in euros
	American	Chilean	Peruvian	Mexican	Argentinian	Colombian
	Dollars	peso	soles	peso	peso	peso	Total
Sales revenue Revenue from services rendered	24,254,429 -	2,022,201 778,268	- -	- -	- -	- -	26,276,630 778,268
Total	24,254,429	2,800,469	-	-	-	-	27,054,898
Purchases	(12,407,766)	(7,257,779)	-	-	-	-	(19,665,545)
Work carried out by other companies	-	(357,859)	-	-	-	-	(357,859)
Reception of services	-	(1,662,109)	(114,587)	(61,961)	(128,234)	(43,552)	(2,010,443)
Total	(12,407,766)	(9,277,747)	(114,587)	(61,961)	(128,234)	(43,552)	(22,033,847)

23. Environmental disclosures

One of the stages which characterizes the development of a renewable energy project (albeit solar or eolic in nature) is the performance of studies and statements on the environmental impact installations may exert. The key purpose of the above is to measure and reduce the true impact of executing projects on the environment.

Competent authorities in the different countries in which the Group operates are in charge of preventing environmental damage. Conducting an environmental impact assessment on any activity makes it possible to introduce environmental aspects during project design and execution, as well as the performance of activities carried out in each country. These assessments certify that public- and private-sector initiatives are prepared to comply with applicable environmental requirements.

Although there are a vast array of different environmental impacts, they can be classified into three types according to origin: (i) environmental impact unleashed by taking advantage of natural resources; (ii) the effects of pollution; and (iii) the damage caused by land occupation.

The Group's projects are generally affected by the environmental impact of land occupation. When a project commences, land is sought and located encompassing the essential characteristics necessary to ensure it is not changed during project execution; on occasion environmental improvements are made.

Another effect on the environment which could impact the Group's PP&E is pollution, since some of the machinery used in carrying out its activities belongs to the Group. In this regard, the parties in charge of executing any stage in the development of a project always seek to optimize equipment organization, adapting it to its surroundings.

Depending on each project, the Group hires different consultants and engineering firms to conduct environmental studies which are subsequently reviewed by competent authorities. Once the study in question has been closely reviewed by competent authorities, the decision is made on the suitability of the activity; the conditions and measures to take to correctly protect the environment and natural resources are then determined.

In accordance with prevailing legislation, the Group controls the degree of contamination produced by waste and emissions by applying an appropriate waste disposal policy.

24. Related-party transactions

24.1 Related-party transactions and balances

In addition to group entities, jointly controlled entities, and associates, the Group's related parties also include directors and senior management of the Parent (including close family members) as well as those entities over which they may exercise control or significant influence.

Receivable and payable balances with related parties at December 31, 2019 and December 31, 2018 are as follows (Note 9.1 and Note 18):

	Parent company	Other related parties	Total 12.31.2019	Parent company	Other related parties	Total 12.31.2018
Assets
Loans to related companies	40,512	-	40,512	45,830	-	45,830
	40,512	-	40,512	45,830	-	45,830
Liabilities	-	(5,436)	(5,436)	-	(27,759)	(27,759)
Payable to suppliers, related companies	-	-	-	(332,879)	(890)	(333,769)
Borrowings from related companies	-	(5,436)	(5,436)	(332,879)	(28,649)	(361,528)

The balances with related parties at December 31, 2019 and December 31, 2018 are comprised of the following:

• Loans to related companies: this amount reflects the debts of certain Group companies owed to the Parent in connection with corporate income tax, as well as credits to other associated entities at December 31, 2018.
• Borrowings from related companies reflect the balance at the end of the period corresponding to the loan facility subscribed with Daruan Group Holding, S.L. as well as the debt of the Parent in connection with corporate income tax.
• Suppliers, related companies reflects the debt pending payment for the fees invoiced by other Group companies at each year end.

The breakdown of transactions carried out with related parties during 2019 and 2018 is as follows:

		12.31.2019	12.31.2018
	Parent company	Other related parties	Parent company	Other related parties
Expenses Leases Services received	(121,837) (121,837) -	(234,059) (114,059) (120,000)	- - -	(250,787) (130,787) (120,000)

The transactions with related parties carried out in 2019 and 2018 are part of the Group's ordinary business and were generally performed on an arm's length basis:

• Rental of the Rafael Botí 2 offices by Nagara Nur, S.L. for 114,050 euros and 130,787 euros in 2019 and 2018, respectively.
• Rental of Rafael Botí 26 offices by Daruan Group Holding, S.L.U. for EUR 121,837 in 2019 (EUR 0 in 2018).
• Management fees invoiced by Daruan Venture Capital amounting to 120,000 euros in 2019 and 2018.

24.2 Disclosures relating to the Board of Directors and Senior Management

During ended 2019 and FY 2018, the directors of the Parent were not granted any advances or credit, nor did the Parent assume any obligations on their behalf by way of guarantees extended. Likewise, the Parent has no pension or life insurance commitments for any of its current or former directors.

The directors and senior management received remuneration as per the following breakdown:

	2019		2018
Item	Board of Directors Senior managers		Board of Directors	Senior managers
Fixed remuneration	202,286	457,645	198,000	90,000
Compensation in kind	7,401	707,189	-	4,168
Total	209,687	1,164,834	198,000	94,168

The detail of the remuneration to the Board of Directors by each of the directors for the years 2019 and 2018 is as follows:

			2019	2018
		Fixed	Compensation	Fixed	Compensation
Name	Position	remuneration	in kind	remuneration	in kind
D. David Ruiz de Andres	President/ CEO	120,000	7,401	120,000	-
D. Florentino Vivancos Gasset	Board member	31,736	-	30,000	-
Dna. Ana Peralta Moreno	Vocal	30,000	-	30,000	-
D. Nicolas Bergareche Mendoza	Vocal	18,000	-	18,000	-
Dila. Maria del Rocio Hortigüela
Esturillo	Vocal	2,550	-		-
TOTAL		202,286	7,401	198,000	-

As indicated in Note 4.17, the incentive plan approved for the directors, executives, employees, and key collaborators of Grenergy Renovables, S.A. was exclusively offered to the executives and key personnel of the Parent; no directors or top executives participate.

The Parent's directors are covered by a civil liability policy paid for by the Company, and have paid premiums in this regard during 2019 and 2018 in the amount of 19 and 3 thousand euros, respectively.

24.3 Other disclosures relating to the directors

At the date of preparation of these consolidated financial statements, none of the Parent's directors had disclosed or informed the Board of Directors of the existence of any direct or indirect conflict of interest with the interests of the Group, either with respect to those members or to the persons referred to in Article 229 of the Spanish Companies Law.

In 2019 and 2018 the directors did not perform any related-party transactions outside the ordinary course of business or under normal market conditions with the Company or with Group companies.

25. Other information

25.1 Risk management policy

The activities of the Group are exposed to various financial risks: market risk (including exchange rate risk), and liquidity risk. The Group's risk management is focused on the uncertainty of financial markets and attempts to minimize the potentially adverse effects on its profitability, using certain financial instruments for this purpose, described further on in the notes.

Market risk

The market in which the Group operates is related to the sector for production and commercialization of renewable energies. It is for this reason that the factors which influence said market positively and negatively can affect the Group's performance.

Market risk in the electricity sector is based on a complex price formation process in each of the countries or markets in which the Grenergy Group performs its business activities.

In general, the price of products offered in the sector of renewable energies contains a regulated component as well as a market component. The first is controlled by the competent authorities of each country or market and can vary whenever said authorities consider it appropriate and necessary, resulting in an obligation for all market agents to adapt to the new circumstances, including the Group companies active in said countries. The cost of energy production would be affected as well as distribution to networks, thereby also affecting the price paid by Grenergy Group clients, either with respect to the negotiation of purchase-sales prices for its projects or price formation in the wholesale market ("merchant") as well as under the Power Purchase Agreements ("PPAs").

As far as the market component is concerned, there is the risk that the competitors of the Grenergy Group, both for renewable energies as well as for conventional energies, may be able to offer lower prices, generating competition in the market which, via pricing, may endanger the stability of the Grenergy Group's client portfolio and could thereby provoke a substantial negative impact on its activities, results, and financial position.

At any rate, as the performance of said sector varies significantly from country to country and continent to continent, three years ago the Group initiated a geographical diversification process, breaking into markets outside Spain (currently the Group is present in Spain, Chile, Mexico, Colombia, Argentina, and Peru), thereby reducing this type of risk even more. At present, all the efforts being made by Grenergy are focused on further developing the projects it owns in these countries.

Product responsibility

The Group designs, develops, executes, and promotes large scale renewable energy projects, certified by TÜV Rheinland; its integrated quality management system (ISO9001) and environmental management system (ISO 14001) systematizes the identification of each project's requirements in terms of quality, safety, and efficiency for each of the phases of said projects.

Client credit risk for Operations and Maintenance (O&M) and Asset Management ("AM") services

With respect to those projects for which the Grenergy Group performs its O&M and AM services, credit risk arises from non-compliance with the recurring payment obligations of the clients party to said contracts, in spite of the fact that these contracts generally foresee quarterly commission payments and payments 30 days subsequent to the issuing of invoices.

The percentage of allowances for insolvencies was zero for 2019.

Exchange rate risk

GRENERGY performs a large part of its economic activities abroad and outside the European market, specifically, in Chile, Peru, Argentina, Mexico, and Colombia. At December 31, 2019 practically all Group revenue was denominated in currencies other than the euro, specifically, the US dollar. Likewise, a large part of the expenses and investments, especially the expenses for the consumables required in the construction activities and investments in development projects, were also obtained in US dollars. Thus, the currency used in the normal course of the Group's corporate activity in LATAM is the local currency or the US dollar.

As a consequence of the fluctuations in the value of local LATAM currencies and the US dollar with respect to the euros (mainly the US dollar) and to the extent that the Group does not at present have any mechanisms or hedging agreements for mitigating exchange rate risks, the Grenergy Group could suffer a negative impact.

Liquidity risk

Liquidity risk refers to the possibility that the Group not be able to meet its financial commitments in the short term. As the Group's business is capital intensive and involves long term debt, it is important for the Group to analyze the cash flows generated by the business so that it can fulfill its debt payment obligations, both financial and commercial.

Liquidity risk arises from the financing needs of the Grenergy Group's activities due to the time lag between requirements and generation of funds. The management of this risk by the Group is based on the rapid rotation of projects which allows the Group to obtain significant cash flows, subsequently reinvesting them in new projects, and the availability of working capital facilities and credit financing with different financial entities for operations abroad.

As the Group has no significant financial commitments in the short term, at the date of authorization of the consolidated financial statements, the cash flows generated in the short term by the Group are sufficient to meet the maturities of financial and commercial debt in the short term. Liquidity risk refers to the possibility that the Group may not be able to meet its financial commitments in the short term.

However, the future cash flows which the Group will generate in the short term may not prove sufficient to meet its debt commitments in the short term, which could provoke a substantial negative impact on its activities, results, and financial position.

Interest-rate risk

The changes in variable interest rates (e.g. EURIBOR) alter the future flows of assets and liabilities referenced to such rates, especially short and long-term financial debt. The objective of the Grenergy Group's interest rate risk management policy is to achieve a balanced structure of financial debt with a view to reducing the financial cost of debt to the extent possible.

A significant portion of financial debt of the Issuer (e.g. loans and working capital facilities) accrues interest at fixed rates, and as far as structured financing is concerned, such as the "Project Finance" of the Argentinian and Peruvian subsidiaries, the financing contracts are referenced at fixed interest rates or, when referenced to variable rates, allow the Special Purpose Vehicle ("SPV") to substitute the variable rates for fixed rates at each payment request.

However, if future financing is referenced to variable rates or fixed rates increase as a consequence of variable reference rates increasing (EURIBOR or LIBOR), this could provoke a negative impact for the Grenergy Group.

Environmental risks

Amongst the commitments acquired in connection with Environmental certification, objectives for continual improvements were set with respect to the environment and the environmental externalities were identified, such as contamination of the atmosphere or water, dangerous waste, and sound or landscape pollution, all considered relatively insignificant.

Thus, in view of its activities and considering the periodic studies carried out on these externalities, the Group does not have any environmental responsibilities, expenses, assets, provisions or contingencies that might be material with respect to its consolidated equity, consolidated financial position, or consolidated results.

25.2 Guarantee commitments to third parties

In 2019, the Group provided guarantees to third parties in the amount of 45,286,171 euros (2018: 19,016,949 euros), which were chiefly arranged for presentation in public renewable energy tenders.

Since the above-mentioned guarantees are provided basically to ensure compliance with contractual obligations or investment commitments, the events that would lead to their execution, and therefore the cash disbursement, would be failures by Grenergy to meet its obligations in relation to the ordinary course of its business, which is considered to have a remote probability of occurrence. Grenergy estimates that unforeseen liabilities at 31 December 2019, if any, which might arise from the guarantees provided, would not be material.

25.3 Fees of auditors and related entities

The fees accrued for professional services provided by Ernst & Young S.L. in fiscal year 2019 and MAZARS Auditores, S.L.P. In the 2018 fiscal year they are detailed below:

	2019		2018
Categories	Services provided by the auditor and related companies	Services provided by other auditors of the Group	Services provided by the auditor and related companies	Services provided by other auditors of the Group
Audit services (1)	99,250	51,150	50,800	50,708
Other verification services (2)	32,000	1,800	-	-
Total audit and related services	131,750	52,950	50,800	50,708
Tax services	-	-	-	-
Total other professional services	-	-	-	-
Total professional services	131,750	52,950	50,800	50,708

(1) Audit services: This heading includes services rendered for the performance of statutory audits of the Group's annual financial statements and the limited review work performed with respect to the interim consolidated financial statements.

(2) Other audit-related assurance services: Mainly corresponds to the Comfort letter review necessary for issuing green bonds.

26. Segmented information

The activity of the Group consists in the promotion and commercialization of renewable energy installations as well as the production of electric energy and any other complementary activities, together with the management and operation of such renewable energy installations.

The Group analyzes its operating segments based on reviewed internal reports relating to the companies comprising the Group which are regularly reviewed, discussed, and evaluated in the decision-making process, in order to use its resources accordingly while also assessing their performance. The Group classifies its different business activities under the following operational divisions:

• Development and Construction: This division's activities involve the search for feasible projects, in both financial as well as technical terms, the necessary work for reaching all the milestones for initiating construction, and preparatory work on the land for the construction and starting up of each project.
• Energy: This division deals with revenue obtained from the sale of energy in each of the markets in which the Group has or will have its own operational projects as Independent Power Producer ("IPP").
• Services: services provided to projects are included once the commissioning date ("COD") has been reached and, therefore, they are in their operational phase. It includes the activities of asset management and O&M, provided both to own projects in their IPP status, and to third-party projects.

The distribution of income and EBITDA between the three business divisions at the end of the 2019 and 2018 is as follows:

	Thousands of euros
Income	2019 2018
Development and Construction Energy Services	83,171 - 1,358	43,268 2,022 1,010
Total income	84,529	46,300

	Thousands of euros
EBITDA	2019 2018
Development and Construction Energy Services Corporate	22,962 - 101 (4,592)	19,836 1,454 213 (3,039)
Total	18,471	18,464

The amount of income shown in the above table includes the following headings in the accompanying consolidated income statement: "Revenue;" "Work performed by the entity and capitalized;" "Gains (losses) on disposals;" and "Gains (losses) due to loss of control over consolidated interests." The amount of income on the above table reflects 12,240 thousand euros during 2019, and 8,191 thousand euros during 2018, which are unrealized income with regard to third parties.

The amount shown above for EBITDA includes "Operating profit" less "Depreciation and amortization" and "Impairment losses" on the accompanying consolidated income statement.

The "Development and construction" segment EBITDA for 2019 includes the negative consolidation difference generated by the business combination mentioned in Note 5, in the amount of 10,981 thousand euros.

The total amount of income at the end of the 2019 and 2018 detailed by its geographical location is the following:

	12.31.2019	12.31.2018
Chile Spain	84,292 237	46,068 232
Total (thousands of euros)	84,529	46,300

The Group's assets and liabilities at December 31, 2019 and December 31, 2018 are shown below by geographical location:

Year ended December 31, 2019

ASSETS	Spain	Chile	Mexico	Peru	Colombia	Argentina	Total 12.31.2019
NON-CURRENT ASSETS	3,721,756	31,646,498	64,125	17,461,689	151,206	34,998,867	88,044,141
Intangible assets	70,720	5,709,366	-	-	-	3,665,821	9,445,907
Property, plant, and equipment	2,198,049	21,090,423	60,863	15,774,842	119,242	31,103,440	70,346,859
Right-of-use assets	458,951	2,321,693	-	1,682,363	-	101,427	4,564,434
Financial investments	150,037	30,042	3,262	4,484	-	1,166	188,991
Deferred tax assets	843,999	2,494,974	-	-	31,964	127,013	3,497,950
CURRENT ASSETS	27,886,284	26,485,607	202,692	6,335,683	113,171	8,559,432	69,582,869
Inventories	872,111	7,964,972	-	4,403	-	9,630	8,851,116
Trade and other receivables	2,437,578	12,079,936	183,322	6,073,352	36,050	3,952,384	24,762,622
Investments in related companies	40,512	-	-	-	-	-	40,512
Financial investments	6,857,767	15,295	-	-	-	-	6,873,062
Accruals	222,595	25,526	-	-	34,349	-	282,470
Cash and cash equivalents	17,455,721	6,399,878	19,370	257,928	42,772	4,597,418	28,773,087
TOTAL ASSETS	31,608,040	58,132,105	266,817	23,797,372	264,377	43,558,299	157,627,010

EQUITY AND LIABILITIES	Spain	Chile	Mexico	Peru	Colombia	Argentina	Total 12.31.2019
EQUITY	42,540,368	(255,414)	(2,278,583)	(530,729)	(100,560)	(2,277,607)	37,097,475
Capital and reserves	42,704,129	1,104,681	(2,317,986)	(802,966)	(128,326)	(2,381,325)	38,178,207
Share capital	8,507,177	-	-	-	-	-	8,507,177
Share premium	6,117,703	-	-	-	-	-	6,117,703
Legal reserve	728,631	-	-	-	-	-	728,631
Other reserves	18,276,644	(824,604)	(2,074,362)	(531,703)	(145,292)	15,555	14,716,238
Profit (loss)	12,402,471	1,929,285	(243,624)	(271,263)	16,966	(2,396,880)	11,436,955
Treasury shares	(3,328,497)	-	-	-	-	-	(3,328,497)
Unrealized gains (losses) reserve	-	(1,360,309)	77,144	221,055	27,766	103,718	(930,626)
Minority interests	(163,761)	214	(37,741)	51,182	-	-	(150,106)
NON-CURRENT LIABILITIES	22,858,655	14,399,362	-	9,534,279	-	26,645,322	73,437,618
Provisions	-	-	-	-	-	2,748,384	2,748,384
Borrowings	22,858,655	11,865,705	-	9,534,279	-	22,980,483	67,239,122
Deferred tax liabilities	-	2,533,657	-	-	-	916,455	3,450,112
CURRENT LIABILITIES	31,712,781	9,400,153	242,766	3,468,200	18,332	2,249,685	47,091,917
Provisions	-	828,909	-	-	-	-	828,909
Borrowings	7,018,189	970,423	-	132,214	-	1,521,378	9,642,204
Trade and other payables	24,694,592	7,600,821	242,766	3,335,986	18,332	728,307	36,620,804
TOTAL EQUITY AND LIABILITIES	97,111,804	23,544,101	(2,035,817)	12,471,750	(82,228)	26,617,400	157,627,010

Year ended December 31, 2018

ASSETS	Spain	Chile	Mexico	Peru	Colombia	Argentina	Total 12.31.2018
NON-CURRENT ASSETS	2,533,001	424,934	64,649	1,423,216	6,194	14,263,494	18,715,488
Intangible assets	3,093	-	-	-	-	2,694,325	2,697,418
Property, plant, and equipment	1,620,795	345,098	61,572	1,420,847	6,194	11,320,119	14,774,624
Right-of-use assets	182,641	-	-	-	-	-	182,641
Investments in group companies and
associates	11,474	-	-	-	-	-	11,474
Financial investments	50,010	36,533	3,077	2,369	-	748	92,737
Deferred tax assets	664,989	43,303	-	-	-	248,302	956,594
CURRENT ASSETS	21,655,692	18,956,164	150,480	333,031	35,219	725,605	41,856,191
Inventories	1,116,306	10,494,324	-	9,092	-	4,974	11,624,696
Trade and other receivables	12,079,613	1,734,606	169,620	277,707	9,870	324,659	14,596,075
Investments in related companies	94,006	-	(48,177)	-	-	-	45,830
Financial investments	-	2,274,570	11,844	-	-	73,889	2,360,303
Accruals	69,289	-	-	-	-	40,957	110,246
Cash and cash equivalents	8,296,478	4,452,664	17,193	46,232	25,348	281,125	13,119,041
TOTAL ASSETS	24,188,693	19,381,098	215,129	1,756,247	41,412	14,989,100	60,571,679

EQUITY AND LIABILITIES	Spain	Chile	Mexico	Peru	Colombia	Argentina	Total 12.31.2018
EQUITY	30,307,107	(2,082,002)	(2,027,427)	(729,853)	(135,504)	(21,642)	25,310,682
Capital and reserves	30,468,438	(1,907,542)	(2,126,787)	(504,689)	(145,292)	15,555	25,799,687
Share capital	3,645,933	-	-	-	-	-	3,645,933
Share premium	6,117,703	-	-	-	-	-	6,117,703
Legal reserve	728,631	-	-	-	-	-	728,631
Other reserves	12,544,835	(3,330,911)	(1,114,456)	(355,425)	(89,488)	(10,125)	7,644,428
Profit (loss)	9,494,306	1,423,369	(1,012,330)	(149,263)	(55,804)	25,680	9,725,962
Treasury shares	(2,062,970)	-	-	-	-	-	(2,062,970)
Unrealized gains (losses) reserve	-	(153,468)	137,978	(217,416)	9,788	(37,197)	(260,315)
Minority interests	(161,331)	(20,992)	(38,618)	(7,748)	-	-	(228,690)
NON-CURRENT LIABILITIES	3,384,054	-	-	-	-	6,350,782	9,734,836
Provisions	-	-	-	-	-	-	-
Borrowings	3,384,054	-	-	-	-	6,350,782	9,734,836
Deferred tax liabilities	-	-	-	-	-	-	-
CURRENT LIABILITIES	18,754,616	6,234,200	257,895	242,477	783	36,189	25,526,161
Provisions	-	19,669	44,481	-	-	-	64,150
Borrowings	7,330,185	3,400	-	-	-	-	7,333,585
Payables to related companies	332,879	-	890	-	-	-	333,769
Trade and other payables	11,091,552	6,179,755	212,525	242,477	783	36,189	17,763,282
Accruals	-	31,376	-	-	-	-	31,376
TOTAL EQUITY AND LIABILITIES	52,445,777	4,152,198	(1,769,532)	(487,377)	(134,721)	6,365,329	60,571,679

27. Subsequent events

No subsequent events have been produced from the closing date of the financial statements till the formulation of the financial statements that could modify the content thereof.

28. Explanation to the translation to English

These consolidated financial statements are prepared on the basis of IFRSs, as issued by the International Accounting Standard Board and as adopted by the European Union, and certain accounting practices applied by the Group that conform with IFRSs may not conform with other generally accepted accounting principles.

GRENERGY RENOVABLES, S.A. AND SUBSIDIARIES

									(Euros)
				% capital - voting rights			Balance at 12.31.2019				Other		Profit or loss
								Carrying			equity		Continuing	Continued	Total
Name	Domicile	Activity					Direct Indirect Total Cost Impairment	amount		Capital Reserves	accounts	Operating	operations	operations	Equity
		Production of renewable
GREENHOUSE SOLAR FIELDS, S.L.	Spain	electric energy	100%	-		100% 3,006	-	3,006	3,006	(576)	-	(150)	(113)	-	2,317
		Production of renewable
GREENHOUSE SOLAR ENERGY, S.L.	Spain	electric energy	100%	-		100% 3,006	-	3,006	3,006	(414)	-	(150)	(113)	-	2,479
		Production of renewable
GREENHOUSE RENEWABLE ENERGY, S.L.	Spain	electric energy	100%	-		100% 3,006	-	3,006	3,006	(299)	-	(150)	(113)	-	2,594
		Production of renewable
GUIA DE ISORA SOLAR 2, S.L.	Spain	electric energy	100%	-		100% 1,565	-	1,565	3,100	(6,592)	-	(395)	(296)	-	(3,788)
		Production of renewable
GR SOLAR 2020, S.L.	Spain	electric energy	100%	-		100% 3,000	-	3,000	3,000	(1,901)	-	(4)	(3)	-	1,096
		Production of renewable
GR SUN SPAIN, S.L.	Spain	electric energy	100%	-		100% 3,000	-	3,000	3,000	(2,505)	-	-	-	-	495
		Production of renewable
GR EQUITY WIND AND SOLAR, S.L.	Spain	electric energy	100%	-		100% 3,000	-	3,000	3,000	273,911	-	(154)	13,219	-	290,130
		Production of renewable
LEVEL FOTOVOLTAICA S.L.	Spain	electric energy (Inactive)	50%	-		50% 1,504	-	1,504		3,008 (322,662)	-	(4,860)	(4,893)		- (324,547)
		Production of renewable
GR BAÑUELA RENOVABLES, S.L.	Spain	electric energy	100%	-		100% 3,000	-	3,000	3,000	(617)	-	-	-	-	2,383
		Production of renewable
GR TURBON RENOVABLES, S.L.	Spain	electric energy	100%	-		100% 3,000	-	3,000	3,000	(611)	-	-	-	-	2,389
		Production of renewable
GR AITANA RENOVABLES, S.L.	Spain	electric energy Production of renewable	100%	-		100% 3,000	-	3,000	3,000	(593)	-	-	-	-	2,407
GR ASPE RENOVABLES, S.L.	Spain	electric energy	100%	-		100% 3,000	-	3,000	3,000	(620)	-	-	-	-	2,380
		Production of renewable
VIATRES RENEWABLE ENERGY, S.L.	Spain	electric energy (Inactive)	40%	-		40% 1,200	-	1,200	3,000	-	-	-	-	-	3,000
		Production of renewable
EIDEN RENOVABLES, S.L.	Spain	electric energy	100%	-		100% 3,000	-	3,000	3,000	(349)	-	-	-	-	2,651
		Production of renewable
CHAMBO RENOVABLES, S.L.	Spain	electric energy	100%	-		100% 3,000	-	3,000	3,000	(349)	-	-	-	-	2,651
		Production of renewable
MAMBAR RENOVABLES, S.L.	Spain	electric energy	100%	-		100% 3,000	-	3,000	3,000	(348)	-	-	-	-	2,652
		Production of renewable
EL AGUILA RENOVABLES, S.L.	Spain	electric energy	100%	-		100% 3,000	-	3,000	3,000	(289)	-	-	-	-	2,711
		Production of renewable
EUGABA RENOVABLES, S.L.	Spain	electric energy	100%	-		100% 3,000	-	3,000	3,000	(368)	-	389	292	-	2,924
		Production of renewable
TAKE RENOVABLES, S.L.	Spain	electric energy	100%	-		100% 3,000	-	3,000	3,000	(391)	-	414	311	-	2,920
		Production of renewable
NEGUA RENOVABLES, S.L.	Spain	electric energy	100%	-		100% 3,000	-	3,000	3,000	575	-	(533)	(399)	-	3,176

GRENERGY RENOVABLES, S.A. AND SUBSIDIARIES

										(Euros)
				% capital - voting rights			Balance at 12.31.2019				Other		Profit or loss
								Carrying			equity		Continuing	Continued	Total
Name	Domicile	Activity		Direct Indirect	Total	Cost	Impairment	amount		Capital Reserves	accounts	Operating	operations	operations	Equity
		Production of renewable				3,000
GR SISON RENOVABLES, S.L.U.	Spain	electric energy (Inactive)	100%	-	100%	(3,000)	-	-	-	-	-	-	-	-	-
		Production of renewable				3,000
GR PORRON RENOVABLES, S.L.U.	Spain	electric energy (Inactive)	100%	-	100%	(3,000)	-	-	-	-	-	-	-	-	-
		Production of renewable				3,000
GR BISBITA RENOVABLES S.L.U.	Spain	electric energy (Inactive)	100%	-	100%	(3,000)	-	-	-	-	-	-	-	-	-
		Production of renewable				3,000
GR AVUTARDA RENOVABLES, S.L.U.	Spain	electric energy (Inactive)	100%	-	100%	(3,000)	-	-	-	-	-	-	-	-	-
		Production of renewable				3,000
GR COLIMBO RENOVABLES, S.L.U.	Spain	electric energy (Inactive)	100%	-	100%	(3,000)	-	-	-	-	-	-	-	-	-
		Production of renewable				3,000
GR MANDARIN RENOVABLES S.L.U.	Spain	electric energy (Inactive)	100%	-	100%	(3,000)	-	-	-	-	-	-	-	-	-
		Production of renewable				3,000
GR DANICO RENOVABLES S.L.U.	Spain	electric energy (Inactive)	100%	-	100%	(3,000)	-	-	-	-	-	-	-	-	-
GR CHARRAN RENOVABLES S.L.U.	Spain	Production of renewable electric energy (Inactive)	100%	-	100%	3,000 (3,000)	-	-	-	-	-	-	-	-	-
		Production of renewable				3,000
GR CERCETA RENOVABLES S.L.U.	Spain	electric energy (Inactive)	100%	-	100%	(3,000)	-	-	-	-	-	-	-	-	-
		Production of renewable				3,000
GR CALAMON RENOVABLES S.L.U.	Spain	electric energy (Inactive)	100%	-	100%	(3,000)	-	-	-	-	-	-	-	-	-
		Production of renewable				3,000
GR CORMORAN RENOVABLES S.L.U.	Spain	electric energy (Inactive)	100%	-	100%	(3,000)	-	-	-	-	-	-	-	-	-
		Production of renewable				3,000
GR GARCILLA RENOVABLES S.L.U.	Spain	electric energy (Inactive)	100%	-	100%	(3,000)	-	-	-	-	-	-	-	-	-
		Production of renewable				3,000
GR LAUNICO RENOVABLES S.L.U.	Spain	electric energy (Inactive)	100%	-	100%	(3,000)	-	-	-	-	-	-	-	-	-
		Production of renewable				3,000
GR MALVASIA RENOVABLES S.L.U.	Spain	electric energy (Inactive)	100%	-	100%	(3,000)	-	-	-	-	-	-	-	-	-
		Production of renewable				3,000
GR MARTINETA RENOVABLES S.L.U.	Spain	electric energy (Inactive) Production of renewable	100%	-	100%	(3,000) 3,000	-	-	-	-	-	-	-	-	-
GR FAISAN RENOVABLES S.L.U.	Spain	electric energy (Inactive)	100%	-	100%	(3,000)	-	-	-	-	-	-	-	-	-
		Promotion and construction
GRENERGY PACIFIC LTDA	Chile	of renewable energy plants.	99.9%	-		99.9% 43,150	-	43,150		35,732 1,289,309 (141,875)		517,350	69,501		- 1,252,667 (*)
		Production of renewable				1,408
GR PEUMO, S.P.A.	Chile	electric energy (Inactive)	100%	-	100.0%	(1,408)	-	-	-	-	-	-	-	-	-
		Production of renewable				1,408
GR QUEULE, S.P.A.	Chile	electric energy (Inactive)	100%	-	100.0%	(1,408)	-	-	-	-	-	-	-	-	-
		Production of renewable				1,408
GR MAITEN, S.P.A.	Chile	electric energy (Inactive)	100%	-	100.0%	(1,408)	-	-	-	-	-	-	-	-	-

GRENERGY RENOVABLES, S.A. AND SUBSIDIARIES

								(Euros)
				% capital - voting rights			Balance at 12.31.2019					Profit or loss
								Carrying			Other equity		Continuing	Continued	Total
Name	Domicile	Activity		Direct Indirect	Total	Cost	Impairment	amount		Capital Reserves	accounts	Operating	operations	operations	Equity
		Production of renewable electric				1,303
GR ALGARROBO S.P.A	Chile	energy (Inactive)	100%	-	100.0%	(1,303)	-	-	-	-	-	-	-	-	-
		Production of renewable electric				917
GR PACIFIC CHILOE SPA	Chile	energy (Inactive)	-	98%	98.0%	(917)	-	-	-	-	-	-	-	-	-
		Production of renewable electric				1,357
GR PACIFIC OVALLE, SPA	Chile	energy (Inactive)	-	98%	98.0%	(1,357)	-			- 970,530 (962,949)	-	168	(20)	-	7,561
		Production of renewable electric				1,357
GR PIMIENTO, SPA	Chile	energy (Inactive)	100%	-	100.0%	(1,357)	-	-	-	-	-	-	-	-	-
		Production of renewable electric				1,357
GR CHAÑAR, SPA	Chile	energy (Inactive)	100%	-	100.0%	(1,357)	-	-	-	-	-	-	-	-	-
		Production of renewable electric				1,357
GR CARZA, SPA	Chile	energy (Inactive)	100%	-	100.0%	(1,357)	-	-	-	-	-	-	-	-	-
		Production of renewable electric				1,357
GR PILO, SPA	Chile	energy (Inactive)	100%	-	100.0%	(1,357)	-	-	-	-	-	-	-	-	-
		Production of renewable electric				1,357
GR LÚCUMO, SPA	Chile	energy (Inactive)	100%	-	100.0%	(1,357)	-	-	-	-	-	-	-	-	-
		Production of renewable electric				1,357
GR PITAO, SPA	Chile	energy (Inactive)	100%	-	100.0%	(1,357)	-	-	-	-	-	-	-	-	-
		Production of renewable electric				1,357
GR LLEUQUE, SPA	Chile	energy (Inactive)	100%	-	100.0%	(1,357)	-	-	-	-	-	-	-	-	-
		Production of renewable electric				1,357
GR NOTRO, SPA	Chile	energy (Inactive)	100%	-	100.0%	(1,357)	-	-	-	-	-	-	-	-	-
		Production of renewable electric				1,357
GR LENGA, SPA	Chile	energy (Inactive)	100%	-	100.0%	(1,357)	-	-	-	-	-	-	-	-	-
		Production of renewable electric				1,357
GR TEPÚ, SPA	Chile	energy (Inactive)	100%	-	100.0%	(1,357)	-	-	-	-	-	-	-	-	-
		Production of renewable electric				1,357
GR LUMILLA, SPA	Chile	energy (Inactive)	100%	-	100.0%	(1,357)	-	-	-	-	-	-	-	-	-
		Production of renewable electric				1,357
GR TOROMIRO, SPA	Chile	energy (Inactive)	100%	-	100.0%	(1,357)	-	-	-	-	-	-	-	-	-
		Production of renewable electric				1,357
GR PACAMA,S PA	Chile	energy (Inactive)	100%	-	100.0%	(1,357)	-	-	-	-	-	-	-	-	-
		Production of renewable electric				1,357
GR TEMO, SPA	Chile	energy (Inactive)	100%	-	100.0%	(1,357)	-	-	-	-	-	-	-	-	-
		Production of renewable electric				1,357
GR RULI, SPA	Chile	energy (Inactive)	100%	-	100.0%	(1,357)	-	-	-	-	-	-	-	-	-
		Production of renewable electric				1,314
GR POLPAICO PACIFIC, SPA	Chile	energy (Inactive) Production of renewable electric	-	98%	98.0%	(1,314) 1,441	-	-	-	-	-	-	-	-	-
GR Roble SpA	Chile	energy (Inactive)	100%	-	100.0%	(1,441)	-	-	-	-	-	-	-	-	-

GRENERGY RENOVABLES, S.A. AND SUBSIDIARIES

										(Euros)
				% capital - voting rights			Balance at 12.31.2019						Profit or loss
								Carrying			Other equity		Continuing	Continued	Total
Name	Domicile	Activity		Direct Indirect	Total	Cost	Impairment	amount		Capital Reserves	accounts	Operating	operations	operations	Equity
		Production of renewable electric				1,441
GR Guindo SpA	Chile	energy (Inactive)	100%	-	100.0%	(1,441)	-	-	1,191	(119)	-	(21,366)	(21,366)		- (20,294)
		Production of renewable electric				1,441
GR Raulí SpA	Chile	energy (Inactive)	100%	-	100.0%	(1,441)	-	-	-	-	-	-	-	-	-
		Production of renewable electric				1,441
GR Manzano SpA	Chile	energy (Inactive)	100%	-	100.0%	(1,441)	-	-	-	-	-	-	-	-	-
		Production of renewable electric				1,441
GR Naranjillo SpA	Chile	energy (Inactive)	100%	-	100.0%	(1,441)	-	-	-	-	-	-	-	-	-
		Production of renewable electric				1,441
GR Mañio SpA	Chile	energy (Inactive)	100%	-	100.0%	(1,441)	-	-	-	-	-	-	-	-	-
		Production of renewable electric				1,441
GR Tara SpA	Chile	energy (Inactive)	100%	-	100.0%	(1,441)	-	-	-	-	-	-	-	-	-
		Production of renewable electric				1,441
GR Ciprés SpA	Chile	energy (Inactive)	100%	-	100.0%	(1,441)	-	-	-	-	-	-	-	-	-
		Production of renewable electric				1,441
GR Ulmo SpA	Chile	energy (Inactive)	100%	-	100.0%	(1,441)	-	-	-	-	-	-	-	-	-
		Production of renewable electric				1,441
GR Hualo SpA	Chile	energy (Inactive)	100%	-	100.0%	(1,441)	-	-	-	-	-	-	-	-	-
		Production of renewable electric				1,441
GR Sauce SpA	Chile	energy	100%	-	100.0%	(1,441)	-	-	1,191	(358)	-	2,207	(12,804)		- (11,971)
		Production of renewable electric				1,258
GR Huacano SpA	Chile	energy (Inactive)	100%	-	100.0%	(1,258)	-	-	-	-	-	-	-	-	-
		Production of renewable electric				1,258
GR Corcolén SpA	Chile	energy (Inactive)	100%	-	100.0%	(1,258)	-	-	-	-	-	-	-	-	-
		Production of renewable electric				1,258
GR Luma SpA	Chile	energy (Inactive)	100%	-	100.0%	(1,258)	-	-	-	-	-	-	-	-	-
GR Fuinque SpA	Chile	Production of renewable electric energy (Inactive)	100%	-	100.0%	1,258 (1,258)	-	-	-	-	-	-	-	-	-
		Production of renewable electric				1,258
GR Piñol SpA	Chile	energy (Inactive)	100%	-	100.0%	(1,258)	-	-	-	-	-	-	-	-	-
		Production of renewable electric				1,258
GR Queñoa SpA	Chile	energy (Inactive)	100%	-	100.0%	(1,258)	-	-	-	-	-	-	-	-	-
		Production of renewable electric				1,258
GR Tayú Spa	Chile	energy (Inactive)	100%	-	100.0%	(1,258)	-	-	-	-	-	-	-	-	-
		Production of renewable electric				1,258
GR Petra SpA	Chile	energy (Inactive)	100%	-	100.0%	(1,258)	-	-	-	-	-	-	-	-	-
		Production of renewable electric				1,258
GR Corontillo SpA	Chile	energy (Inactive)	100%	-	100.0%	(1,258)	-	-	-	-	-	-	-	-	-
		Production of renewable electric				1,258
GR Liun SpA	Chile	energy (Inactive)	100%	-	100.0%	(1,258)	-	-	-	-	-	-	-	-	-

GRENERGY RENOVABLES, S.A. AND SUBSIDIARIES

									(Euros)
			% capital - voting rights Balance at 12.31.2019							Profit or loss Other
								Carrying			equity		Continuing	Continued	Total
Name	Domicile	Activity		Direct Indirect	Total	Cost	Impairment	amount	Capital	Reserves	accounts	Operating	operations	operations	Equity
		Production of renewable				1,258
GR Kewiña SpA	Chile	electric energy (Inactive)	100%	-	100.0%	(1,258)	-	-	-	-	-	-	-	-	-
		Production of renewable				1,258
GR Frangel SpA	Chile	electric energy (Inactive)	100%	-	100.0%	(1,258)	-	-	-	-	-	-	-	-	-
		Production of renewable				1,258
GR Maqui SpA	Chile	electric energy (Inactive)	100%	-	100.0%	(1,258)	-	-	-	-	-	-	-	-	-
		Production of renewable				1,258
GR Petrillo SpA	Chile	electric energy (Inactive)	100%	-	100.0%	(1,258)	-	-	-	-	-	-	-	-	-
		Production of renewable				1,258
GR Tepa SpA	Chile	electric energy (Inactive)	100%	-	100.0%	(1,258)	-	-	-	-	-	-	-	-	-
		Operation and
		maintenance of renewable
Grenergy OPEX SpA	Chile	energy plants	100%	-	100.0%	1,258	-	1,258	1,191	-	-	102,141	73,471	-	74,662
		Operation and
Parque Eólico Quillagua SpA	Chile	maintenance of renewable energy plants	100%	-		100.0% 14,907,246				- 14,907,246 19,343,306 (1,531,547) (477,733)		79,340	(298,699)		- 17,035,327
		Promotion and construction
GRENERGY PERU SAC	Peru	of renewable energy plants. 99%		-	99%	275	-	275	275	(810,720)	-	603,265	639,558	-	(170,887)
		Production of renewable
GR JULIACA, S.A.C.	Peru	electric energy (Inactive)	100%	-	100%	255	-	255	255	-	-	-	-	-	255
		Production of renewable
GR HUAMBOS, S.A.C.	Peru	electric energy (Inactive)	100%	-	100%	255	-	255	255	-	-	-	-	-	255
		Production of renewable
GR APORIC, S.A.C.	Peru	electric energy (Inactive)	100%	-	100%	255	-	255	255	-	-	-	-	-	255
		Production of renewable
GR BAYONAR, S.A.C.	Peru	electric energy (Inactive)	100%	-	100%	255	-	255	255	-	-	-	-	-	255
		Production of renewable
GR VALE S.A.C.	Peru	electric energy (Inactive)	100%	-	100%	255	-	255	255	-	-	-	-	-	255
		Production of renewable				278
GR CORTARRAMA S.A.C.	Peru	electric energy (Inactive)	100%	-	100%	(278)	-	-	-	-	-	-	-	-	-
		Production of renewable				278
GR GUANACO S.A.C.	Peru	electric energy (Inactive)	100%	-	100%	(278)	-	-	-	-	-	-	-	-	-
		Production of renewable
GR TARUCA S.A.C.	Peru	electric energy Production of renewable	90%	-	90%	2,862,143	-	2,862,143	3,229,815	96,067	-	(34,044)	56,849	-	3,382,731	(*)
GR PAINO S.A.C.	Peru	electric energy	90%	-	90%	2,872,698	-	2,872,698	3,241,615	96,147	-	(27,555)	38,471	-	3,376,233	(*)
		Production of renewable				278
GR PAICHE S.A.C.	Peru	electric energy (Inactive)	100%	-	100%	(278)	-	-	-	-	-	-	-	-	-
		Production of renewable				278
GR LIBLANCA S.A.C.	Peru	electric energy (Inactive)	100%	-	100%	(278)	-	-	-	-	-	-	-	-	-
		Promotion and construction
GR RENOVABLES MÉXICO	Mexico	of renewable energy plants. 98%		-	98%	2,843	-	2,843		2,358 (1,505,453)	-	(91,217)	(46,006)		- (1,549,101)
		Production of renewable
GREENHUB S.L. DE C.V.	Mexico	electric energy	20%	80%	100%	17,799	-	17,799	96,684	2,325	-	(30,483)	(30,483)	-	68,526

GRENERGY RENOVABLES, S.A. AND SUBSIDIARIES

Participations in Group companies and Associates at December 31, 2019

									(Euros)
				% capital - voting rights			Balance at 12.31.2019				Other
Name	Domicile	Activity		Direct Indirect	Total	Cost	Impairment	Carrying amount	Capital	Reserves	equity accounts	Operating	Profit or loss Continuing operations	Continued operations	Total Equity
FAILO 3 SACV	Mexico	Production of renewable electric energy (Inactive)	-	50%	50%	-	-	-	15,311	(16,361)	-	-	-	-	(1,050)
ASTILO 1 SOLAR, SACV	Mexico	Production of renewable electric energy (Inactive) Production of renewable	-	99.99% 99.99%		2,790 (2,790) 2,790	-	-	2,358	(28,637)	-	-	-	-	(26,279)
CRISON 2 SOLAR, SACV	Mexico	electric energy (Inactive) Production of renewable	-	99.99% 99.99%		(2,790) 2,790	-	-	2,358	(2,279)	-	-	-	-	79
MESO 4 SOLAR, SACV	Mexico	electric energy (Inactive) Production of renewable	-	99.99% 99.99%		(2,790) 2,790	-	-	2,358	(25,281)	-	-	-	-	(22,923)
ORSIPO 5 SOLAR, SACV	Mexico	electric energy Production of renewable	-	99.99% 99.99%		(2,790) 2,790	-	-	2,351	5,950	-	(795)	(27,472)	-	(19,171)
MIRGACA 6 SOLAR, SACV	Mexico	electric energy (Inactive) Promotion and construction of	-	99.99% 99.99%		(2,790)	-	-	2,358	(436)	-	-	-	-	1,922
GRENERGY COLOMBIA S.A.S. Colombia		renewable energy plants. Promotion and construction of	100%	-	100%	270,237	-	270,237		261,720 (109,038)	-	(21,559)	16,966	-	169,648
GRENERGY ATLANTIC, S.A.U. Argentina		renewable energy plants. Production of renewable electric energy; promotion and	100%	-	100%	103,629	-	103,629	101,644	(62,294)	-	(155,654)	(266,344)	-	(226,994)
KOSTEN S.A.	Argentina	construction of renewable energy plants.	100%	-		100% 8,158,807		- 8,158,807 5,548,811		45,291	-		(299,416) (2,130,535)	-	3,463,567 (*)

(*) Exchange rate used closing 12.31.2019, except for the result that use the average 2019 fiscal year.

(**) Audited annual accounts

GRENERGY RENOVABLES, S.A. AND SUBSIDIARIES

									(Euros)
			% capital - voting rights Balance at 12.31.2018						Other
								Carrying			equity		Profit or loss Continuing	Continued	Total
Name	Domicile	Activity	Direct	Indirect	Total	Cost	Impairment	amount	Capital	Reserves	accounts	Operating	operations	operations	Equity
GREENHOUSE SOLAR		Production of renewable electric energy; promotion
FIELDS, S.L.	Spain	and construction of renewable energy plants.	100%	-		100% 3,006	-	3,006	3,006	(414)	-	(217)	(160)	-	2,433
GREENHOUSE SOLAR		Production of renewable electric energy; promotion
ENERGY, S.L.	Spain	and construction of renewable energy plants.	100%	-		100% 3,006	-	3,006	3,006	(276)	-	(184)	(138)	-	2,592
GREENHOUSE		Production of renewable electric energy; promotion
RENEWABLE ENERGY, S.L.	Spain	and construction of renewable energy plants.	100%	-		100% 3,006	-	3,006	3,006	(137)	-	(217)	(163)	-	2,707
GUIA DE ISORA		Production of renewable electric energy; promotion
SOLAR 2, S.L.	Spain	and construction of renewable energy plants.	100%	-		100% 1,565	-	1,565	3,100	(6,344)	-	(332)	(249)	-	(3,492)
		Production of renewable electric energy; promotion
GR SOLAR 2020, S.L.	Spain	and construction of renewable energy plants.	100%	-		100% 3,000	-	3,000	3,000	(1,136)	-	(1,021)	(766)	-	1,099
		Production of renewable electric energy; promotion
GR SUN SPAIN, S.L.	Spain	and construction of renewable energy plants.	100%	-		100% 3,000	-	3,000	3,000	(2,502)	-	(4)	(3)	-	495
GR EQUITY WIND AND		Production of renewable electric energy; promotion
SOLAR, S.L.	Spain	and construction of renewable energy plants.	100%	-		100% 3,000	-	3,000	3,000	198,154	-	108,659	117,308	-	318,462
LEVEL		Production of renewable electric energy; promotion
FOTOVOLTAICA S.L.	Spain	and construction of renewable energy plants.	50%	-	50%	1,504	-	1,504	3,008	(15,288)	-	(307,350)	(307,350)	-	(319,630)
GR BAÑUELA		Production of renewable electric energy; promotion
RENOVABLES, S.L.	Spain	and construction of renewable energy plants.	100%	-		100% 3,000	-	3,000	3,000	(617)	-	-	-	-	2,383
GR TURBON		Production of renewable electric energy; promotion
RENOVABLES, S.L.	Spain	and construction of renewable energy plants.	100%	-		100% 3,000	-	3,000	3,000	(611)	-	-	-	-	2,389
GR AITANA		Production of renewable electric energy; promotion
RENOVABLES, S.L. GR ASPE	Spain	and construction of renewable energy plants. Production of renewable electric energy; promotion	100%	-		100% 3,000	-	3,000	3,000	(593)	-	-	-	-	2,407
RENOVABLES, S.L.	Spain	and construction of renewable energy plants.	100%	-		100% 3,000	-	3,000	3,000	(620)	-	-	-	-	2,380
VIATRES RENEWABLE		Production of renewable electric energy; promotion
ENERGY, S.L.	Spain	and construction of renewable energy plants.	40%	-	40%	1,200	-	1,200	3,000	-	-	-	-	-	3,000
EIDEN		Production of renewable electric energy; promotion
RENOVABLES, S.L.	Spain	and construction of renewable energy plants.	100%	-		100% 3,000	-	3,000	3,000	(289)	-	(60)	(60)	-	2,651
CHAMBO		Production of renewable electric energy; promotion
RENOVABLES, S.L.	Spain	and construction of renewable energy plants.	100%	-		100% 3,000	-	3,000	3,000	(289)	-	(60)	(60)	-	2,651
MAMBAR		Production of renewable electric energy; promotion
RENOVABLES, S.L.	Spain	and construction of renewable energy plants.	100%	-		100% 3,000	-	3,000	3,000	(289)	-	(60)	(60)	-	2,651
EL AGUILA		Production of renewable electric energy; promotion
RENOVABLES, S.L.	Spain	and construction of renewable energy plants.	100%	-		100% 3,000	-	3,000	3,000	(289)	-	-	-	-	2,711
EUGABA		Production of renewable electric energy; promotion
RENOVABLES, S.L.	Spain	and construction of renewable energy plants.	100%	-		100% 3,000	-	3,000	3,000		-	-	-	-	3,000
TAKE		Production of renewable electric energy; promotion
RENOVABLES, S.L.	Spain	and construction of renewable energy plants.	100%	-		100% 3,000	-	3,000	3,000		-	-	-	-	3,000
NEGUA		Production of renewable electric energy; promotion
RENOVABLES, S.L.	Spain	and construction of renewable energy plants.	100%	-		100% 3,000	-	3,000	3,000		-	-	-	-	3,000

GRENERGY RENOVABLES, S.A. AND SUBSIDIARIES

									(Euros)
				% capital - voting rights			Balance at 12.31.2018				Other		Profit or loss
								Carrying			equity		Continuing	Continued	Total
Name	Domicile	Activity	Direct	Indirect	Total	Cost	Impairment	amount		Capital Reserves	accounts	Operating	operations	operations	Equity
GRENERGY		Production of renewable electric energy; promotion
PACIFIC LTDA	Chile	and construction of renewable energy plants.	99.9%	-	99.9%	43,150	-	43,150		43,155 1,289,309	(141,875)	517,350	69,501		- 1,260,090 (**)
		Production of renewable electric energy; promotion				1,408
GR PEUMO, S.P.A.	Chile	and construction of renewable energy plants.	100%	-	100.0%	(1,408)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion				1,408
GR QUEULE, S.P.A.	Chile	and construction of renewable energy plants.	100%	-	100.0%	(1,408)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion				1,408
GR MAITEN, S.P.A.	Chile	and construction of renewable energy plants.	100%	-	100.0%	(1,408)	-	-	-	-	-	-	-	-	-
GR		Production of renewable electric energy; promotion				1,303
ALGARROBO S.P.A	Chile	and construction of renewable energy plants.	100%	-	100.0%	(1,303)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion				1,303
GR MOLLE, S.P.A.	Chile	and construction of renewable energy plants.	100%	-	100.0%	(1,303)	-	-	-	-	746	(21,060)	(21,060)	-	(20,314)
GR		Production of renewable electric energy; promotion				1,303
TAMARUGO, S.P.A.	Chile	and construction of renewable energy plants.	100%	-	100.0%	(1,303)	-	-	-	-	-	-	-	-	-
GR PACIFIC		Production of renewable electric energy; promotion				917
CHILOE SPA	Chile	and construction of renewable energy plants.	-	98%	98.0%	(917)	-	-	-	-	-	-	-	-	-
GR PACIFIC		Production of renewable electric energy; promotion				1,357
OVALLE, SPA	Chile	and construction of renewable energy plants.	-	98%	98.0%	(1,357)	-	-		- 1,049,268		(39,380) (1,001,915) (1,001,879)		-	8,009
		Production of renewable electric energy; promotion				1,357
GR PIMIENTO, SPA	Chile	and construction of renewable energy plants.	100%	-	100.0%	(1,357)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion				1,357
GR CHAÑAR, SPA	Chile	and construction of renewable energy plants.	100%	-	100.0%	(1,357)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion				1,357
GR CARZA, SPA	Chile	and construction of renewable energy plants.	100%	-	100.0%	(1,357)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion				1,357
GR PILO, SPA	Chile	and construction of renewable energy plants.	100%	-	100.0%	(1,357)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion				1,357
GR LÚCUMO, SPA	Chile	and construction of renewable energy plants.	100%	-	100.0%	(1,357)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion				1,357
GR PITAO, SPA	Chile	and construction of renewable energy plants.	100%	-	100.0%	(1,357)	-	-	-	-	-	-	-	-	-
GR LLEUQUE, SPA	Chile	Production of renewable electric energy; promotion and construction of renewable energy plants.	100%	-	100.0%	1,357 (1,357)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion				1,357
GR NOTRO, SPA	Chile	and construction of renewable energy plants.	100%	-	100.0%	(1,357)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion				1,357
GR LENGA, SPA	Chile	and construction of renewable energy plants.	100%	-	100.0%	(1,357)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion				1,357
GR TEPÚ, SPA	Chile	and construction of renewable energy plants.	100%	-	100.0%	(1,357)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion				1,357
GR LUMILLA, SPA	Chile	and construction of renewable energy plants.	100%	-	100.0%	(1,357)	-	-	-	-	-	-	-	-	-

GRENERGY RENOVABLES, S.A. AND SUBSIDIARIES

								(Euros)
				% capital - voting rights			Balance at 12.31.2018				Other		Profit or loss
								Carrying			equity		Continuing	Continued	Total
Name	Domicile	Activity	Direct	Indirect	Total	Cost	Impairment	amount		Capital Reserves	accounts	Operating	operations	operations	Equity
		Production of renewable electric energy; promotion and				1,357
GR TOROMIRO, SPA	Chile	construction of renewable energy plants.	100%	-	100.0%	(1,357)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion and				1,357
GR PACAMA,S PA	Chile	construction of renewable energy plants.	100%	-	100.0%	(1,357)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion and				1,357
GR TEMO, SPA	Chile	construction of renewable energy plants.	100%	-	100.0%	(1,357)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion and				1,357
GR RULI, SPA	Chile	construction of renewable energy plants.	100%	-	100.0%	(1,357)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion and				1,314
GR POLPAICO PACIFIC, SPA	Chile	construction of renewable energy plants.	-	98%	98.0%	(1,314)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion and				1,441
GR Roble SpA	Chile	construction of renewable energy plants.	100%	-	100.0%	(1,441)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion and				1,441
GR Guindo SpA	Chile	construction of renewable energy plants.	100%	-	100.0%	(1,441)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion and				1,441
GR Raulí SpA	Chile	construction of renewable energy plants.	100%	-	100.0%	(1,441)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion and				1,441
GR Manzano SpA	Chile	construction of renewable energy plants.	100%	-	100.0%	(1,441)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion and				1,441
GR Naranjillo SpA	Chile	construction of renewable energy plants.	100%	-	100.0%	(1,441)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion and				1,441
GR Mañio SpA	Chile	construction of renewable energy plants. Production of renewable electric energy; promotion and	100%	-	100.0%	(1,441) 1,441	-	-	-	-	-	-	-	-	-
GR Tara SpA	Chile	construction of renewable energy plants.	100%	-	100.0%	(1,441)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion and				1,441
GR Ciprés SpA	Chile	construction of renewable energy plants.	100%	-	100.0%	(1,441)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion and				1,441
GR Ulmo SpA	Chile	construction of renewable energy plants.	100%	-	100.0%	(1,441)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion and				1,441
GR Hualo SpA	Chile	construction of renewable energy plants.	100%	-	100.0%	(1,441)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion and				1,441
GR Belloto SpA	Chile	construction of renewable energy plants.	100%	-	100.0%	(1,441)	-	-	-	-	1,203	(25,209)	(25,209)		- (24,007)
		Production of renewable electric energy; promotion and				1,441
GR Sauce SpA	Chile	construction of renewable energy plants.	100%	-	100.0%	(1,441)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion and				1,258
GR Huacano SpA	Chile	construction of renewable energy plants.	100%	-	100.0%	(1,258)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion and				1,258
GR Corcolén SpA	Chile	construction of renewable energy plants.	100%	-	100.0%	(1,258)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion and				1,258
GR Luma SpA	Chile	construction of renewable energy plants.	100%	-	100.0%	(1,258)	-	-	-	-	-	-	-	-	-

GRENERGY RENOVABLES, S.A. AND SUBSIDIARIES

									(Euros)
			% capital - voting rights			Balance at 12.31.2018					Other		Profit or loss
						Carrying				equity		Continuing	Continued	Total
Name	Domicile	Activity	Direct	Indirect	Total	Cost	Impairment	amount		Capital Reserves	accounts	Operating	operations	operations	Equity
		Production of renewable electric energy; promotion and				1,258
GR Fuinque SpA	Chile	construction of renewable energy plants.	100%	-	100.0%	(1,258)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion and				1,258
GR Piñol SpA	Chile	construction of renewable energy plants.	100%	-	100.0%	(1,258)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion and				1,258
GR Queñoa SpA	Chile	construction of renewable energy plants.	100%	-	100.0%	(1,258)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion and				1,258
GR Tayú Spa	Chile	construction of renewable energy plants.	100%	-	100.0%	(1,258)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion and				1,258
GR Petra SpA	Chile	construction of renewable energy plants.	100%	-	100.0%	(1,258)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion and				1,258
GR Corontillo SpA	Chile	construction of renewable energy plants.	100%	-	100.0%	(1,258)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion and				1,258
GR Liun SpA	Chile	construction of renewable energy plants.	100%	-	100.0%	(1,258)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion and				1,258
GR Kewiña SpA	Chile	construction of renewable energy plants.	100%	-	100.0%	(1,258)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion and				1,258
GR Frangel SpA	Chile	construction of renewable energy plants. Production of renewable electric energy; promotion and	100%	-	100.0%	(1,258) 1,258	-	-	-	-	-	-	-	-	-
GR Maqui SpA	Chile	construction of renewable energy plants.	100%	-	100.0%	(1,258)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion and				1,258
GR Petrillo SpA	Chile	construction of renewable energy plants.	100%	-	100.0%	(1,258)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion and				1,258
GR Tepa SpA	Chile	construction of renewable energy plants.	100%	-	100.0%	(1,258)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion and				1,258
Grenergy OPEX SpA	Chile	construction of renewable energy plants.	100%	-	100.0%	(1,258)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy; promotion and
GRENERGY PERU SAC	Peru	construction of renewable energy plants.	99%	-	99%	275	-	275		278 (537,292)	13,249	(220,196)	(239,935)		- (763,700) (**)
		Production of renewable electric energy; promotion and
GR JULIACA, S.A.C.	Peru	construction of renewable energy plants.	100%	-	100%	255	-	255	255	-	-	-	-	-	255
		Production of renewable electric energy; promotion and
GR HUAMBOS, S.A.C.	Peru	construction of renewable energy plants.	100%	-	100%	255	-	255	255	-	-	-	-	-	255
		Production of renewable electric energy; promotion and
GR APORIC, S.A.C.	Peru	construction of renewable energy plants.	100%	-	100%	255	-	255	255	-	-	-	-	-	255
		Production of renewable electric energy; promotion and
GR BAYONAR, S.A.C.	Peru	construction of renewable energy plants.	100%	-	100%	255	-	255	255	-	-	-	-	-	255
		Production of renewable electric energy; promotion and
GR VALE S.A.C.	Peru	construction of renewable energy plants.	100%	-	100%	255	-	255	255	-	-	-	-	-	255
		Production of renewable electric energy; promotion and				278
GR CORTARRAMA S.A.C.	Peru	construction of renewable energy plants.	100%	-	100%	(278)	-	-	-	-	-	-	-	-	-

GRENERGY RENOVABLES, S.A. AND SUBSIDIARIES

Participations in Group companies and Associates at December 31, 2018

						(Euros)
			% capital - voting rights			Balance at 12.31.2018			Other		Profit or loss
								Carrying			equity		Continuing	Continued	Total
Name	Domicile	Activity		Direct Indirect	Total	Cost	Impairment	amount	Capital	Reserves	accounts	Operating	operations	operations	Equity
		Production of renewable electric energy;
		promotion and construction of renewable				278
GR GUANACO S.A.C.	Peru	energy plants.	100%	-	100%	(278)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy;
		promotion and construction of renewable
GR TARUCA S.A.C.	Peru	energy plants.	100%	-		100% 1,597,955		- 1,597,955 1,597,955		90,815	(112,305)	(5,224)	43,937	-	1,620,402
		Production of renewable electric energy;
		promotion and construction of renewable
GR PAINO S.A.C.	Peru	energy plants.	100%	-		100% 1,597,955		- 1,597,955 1,597,955		91,052	(112,701)	(5,215)	44,335	-	1,620,640
		Production of renewable electric energy;
		promotion and construction of renewable				278
GR PAICHE S.A.C.	Peru	energy plants.	100%	-	100%	(278)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy;
		promotion and construction of renewable				278
GR LIBLANCA S.A.C.	Peru	energy plants.	100%	-	100%	(278)	-	-	-	-	-	-	-	-	-
		Production of renewable electric energy;
		promotion and construction of renewable
GR RENOVABLES MÉXICO	Mexico	energy plants.	98%	-	98%	2,843	-	2,843		2,901 (1,135,566)	138,658	(414,553)	(423,603)		- (1,417,610)
		Production of renewable electric energy;
		promotion and construction of renewable
GREENHUB S.L. DE C.V.	Mexico	energy plants.	20%	80%	100%	88,994	-	88,994	88,994	-	(48)	(658)	(2,177)	-	86,768
		Production of renewable electric energy;
		promotion and construction of renewable
FAILO 3 SACV	Mexico	energy plants.	-	50%	50%	1,977	-	1,977	1,977	(1,226)	1,268	(15,225)	(15,225)	-	(13,206)
		Production of renewable electric energy;
		promotion and construction of renewable				2,790
ASTILO 1 SOLAR, SACV	Mexico	energy plants.	-	99.99% 99.99%		(2,790)	-	-	-	-	176	(27,185)	(27,185)	-	(27,009)
		Production of renewable electric energy;
		promotion and construction of renewable				2,790
CRISON 2 SOLAR, SACV	Mexico	energy plants.	-	99.99% 99.99%		(2,790)	-	-	-	-	269	(2,418)	(2,418)	-	(2,150)
		Production of renewable electric energy;
		promotion and construction of renewable				2,790
MESO 4 SOLAR, SACV	Mexico	energy plants.	-	99.99% 99.99%		(2,790)	-	-	-	-	26	(23,870)	(23,870)	-	(23,844)
		Production of renewable electric energy;
		promotion and construction of renewable				2,790
ORSIPO 5 SOLAR, SACV	Mexico	energy plants.	-	99.99% 99.99%		(2,790)	-	-	-	-	40	5,921	5,572	-	5,612
		Production of renewable electric energy;
MIRGACA 6 SOLAR, SACV	Mexico	promotion and construction of renewable energy plants.	-	99.99% 99.99%		2,790 (2,790)	-	-	-	-	(3)	(409)	(409)	-	(412)
		Production of renewable electric energy;
		promotion and construction of renewable
GRENERGY COLOMBIA S.A.S.	Colombia	energy plants.	100%	-	100%	12,168	-	12,168	12,168	-	(6,277)	(46,851)	(55,804)	-	(49,913)
		Production of renewable electric energy;
		promotion and construction of renewable
GRENERGY ATLANTICS, S.A.U. Argentina		energy plants.	100%	-	100%	6,486	-	6,486	6,486	(3,616)	15,153	(68,060)	(97,142)	-	(79,120)
		Production of renewable electric energy;
		promotion and construction of renewable
KOSTEN S.A.	Argentina	energy plants.	100%	-		100% 8,158,807		- 8,158,807 5,299,830		(14,182)	126,485	(101,035)	122,822		5,534,955

(*) Exchange rate used closing 12.31.2019, except for the result that use the average 2019 fiscal year.

(**) Audited annual accounts

(***) Audit of financial statements 12.31.2018 carried out by Mazars Mexico.

GRENERGY RENOVABLES S.A. Subsidiaries

Management Report for 2019

1. The Group's financial activity

1.1 Nature of Group operations and key activities

Grenergy is a Spanish company which produces energy independently through the development, financial structuring, building, operation and maintenance of large-scale renewable energy plants.

Dating back to its creation in 2007, the Group has undergone a rapid growth and evolution in planning, designing, developing, building, and implementing project finance structures. It has been present in Spain and the Latam regions since 2012, where it currently has offices in Chile, Peru, Colombia, Argentina, and Mexico. The most recent presentation of half-year results reflected the Group's overall pipeline, which includes photovoltaic energy installations and solar plants in different stages of development within its pipeline over 4 GW.

Its business model encompasses all project phases, from development to construction and the financial structuring process, to plant operation and maintenance. The Company considers the sale to third parties of non-strategic parks as recurring, combining recurring income from its parks in operation as well as income from O&M and AM services for plants sold to third parties.

Grenergy performs its activities in each of the phases comprising the value chain of a renewable energy project, prioritizing greenfield projects: those starting at square one, or in existence yet requiring a full overhaul, vs. brownfield projects, which require certain occasional modifications, increases, or repowering.

The source of this income is technologically diversified, encompassing project developments in wind and photovoltaic energy, in order to attain a fully-renewable matrix at highlycompetitive rates vs. conventional energy sources. This backdrop is further favored by an emerging market for PPAs (bilateral energy purchase-sale agreements), as well as the marked political end of fossil fuels, and plans to shut down nuclear and carbon plants within 10 years.

The Parent has been listed on the continuous market since December 16, 2019, with capitalization at year end totaling 366 million euros.

1.2 Pipeline phases

According to degree of maturity, the Group classifies its projects into the following phases:

• Initial or early stage development (<50%): projects which are technically and financially feasible based on the following circumstances: (i) there is land potential; (ii) access to the electricity grid is considered operationally viable; and/or (iii) it is potentially interesting for sale to third parties.

• Advanced development (>50%): projects in advanced technical and financial stages, since: (i) the land is ensured, or there is at least more than a 50% probability of its obtainment; (ii) the appropriate requests to connect to the grid have been filed, with a 90% or higher likelihood of doing so; and (iii) environmental permits have been requested.

• In Backlog (>80%): projects in the final phase prior to construction, in which: (i) land and access to the grid are assured; (ii) the likelihood of obtaining environmental permits is over 90%; and (iii) there are PPAs or framework agreements with energy buyers or a bank are about to be signed, or there is a stabilized bankable price structure.
• Under construction (100%): EPC projects in which the engineering, construction, and procurement order has been given to break ground under the corresponding contract.
• In operation: projects for which acceptance certificates were signed by the entity/owner of the project in question, for which responsibility over the asset has been transferred from the entity performing the EPC construction tasks to the Group's operations team.

The corresponding administrative authorizations may be obtained during any stage of the pipeline, including during the construction phase.

During 2019, the group had over 4GW in different stages of development.

1.3 Operating divisions

The Grenergy Group classifies its different business activities under the following operational divisions:

• Development and Construction: this division's activities involve the search for feasible projects, in both financial as well as technical terms, the necessary work for reaching all the milestones for initiating construction, and preparatory work on the land for the construction and starting up of each project.
• Energy: this division deals with revenue obtained from the sale of energy in each of the markets in which the Group has or will have its own operational projects as Independent Power Producer ("IPP").
• Services: this division includes the services rendered for projects once they have been started up or from the COD under the corresponding EPC Contract, thus relating to projects which are in the operational phase. Encompasses asset management and O&M activities provided for internal IPP projects, as well as those for third parties.

2. 2019 Business Performance

• · The 2019 consolidated income statement presented revenue figures representing the best results for GRENERGY thus far. Its 18.5 million euro EBITDA and 11.4 million euro net profit reflect the push during recent years in developing and executing Latam projects in portfolio, especially in Chile; these efforts have translated into relevant positive results for the Group, establishing the bases for building the pipeline in Latin America and Spain, as foreseen.
• · Total income and EBIDTA amounted to 84,529,879 and 20,661,463 euros, respectively; below is their breakdown by operating division:

	Thousands of euros
Income	2019	2018
Development and Construction Energy Services	83,171 - 1,358	43,268 2,022 1,010
Total income (*)	84,529	46,300

(*) Alternative performance measures (MAR) See Appendix I.

	Thousands of euros
EBITDA	2019	2018
Development and Construction	22,962	19,836
Energy	-	1,454
Services	101	213
Corporate	(4,592)	(3,039)
Total	18,471	18,464

(*) Alternative performance measures (MAR) See Appendix I.

Development and Construction: the rise in income and EBIDTA margin was the result of a greater number of parks under construction, offset by an increased number of parks sold during 2019 vs. the previous year (2019: 193 MW under construction and 5 sold, vs. 57 MW in construction and 9 sold in 2018).

Energy: The Company did not have any employees with disabilities in 2019.

Services: the rise of income corresponds to a greater number of parks in operation in 2019 as compared to 2018 (105 MW vs. 82).

Corporate: corresponds to general expenses. The main EBIDTA variations were due to an increase in the Group's activity and size.

• · Amortization/depreciation charges totaling 661 thousand euros dropped 25% vs. 2018 as a result of the sale and derecognition of items of PP&E from sold-off parks in 2019.
• · Net finance revenue totaled 3.4 million euros. "Finance cost" encompasses two large figures:
  • o Interest on debt associated to the projects: 1.1 million euros in expenses.
• o Negative exchange differences in 2019 mainly correspond to the pronounced depreciation of the Argentinian peso with respect to the US dollar. This nearly 50% drop made it necessary to adjust the value of VAT refunds in pesos to the prevailing exchange rate at year end, thanks to the establishment of exchange rate provisions, which resulted a negative amount of 2.3 million euros.
• · After/tax profits for the Group totaled 11.4 million euros.
• · The 2019 consolidated financial situation reflects changes reflecting the Group's growth, with the key areas bolstered. Especially positive aspects are:
  • o A 376% increase in "Property, plant, and equipment" to 70.3 million euros was thanks to the construction of the Group's parks planned for operation.
  • o "Equity" grew 47%, reaching 37.1 million euros.
  • o The 22.5 million euro rise in "Working capital" represented 38% over the previous year; this has permitted the Group to easily meet its short-term payment obligations, continue developing its activities, while ensuring its stability, as well as a decrease in its non-current borrowings.
  • o Net debt of borrowings associated to new projects under construction spiked, and debt associated to corporate bond-issues amounted to 22 million euros:

Net debt	12/31/2019	12/31/2018
Long-term financial debt (*)	26,097,393	3,117,519
Short-term financial debt (*)	4,841,280	6,089,510
Other long-term financial liabilities	208,249	266,535
Other short-term financial liabilities	3,342,401	1,244,074
Short-term financial investments, other financial assets	(6,873,062)	(123,838)
Cash and equivalents (*)	(20,408,005)	(5,753,046)
Corporate net debt with recourse	7,208,256	4,840,754
Project Debt with recourse (*)	42,392,003	6,350,782
Project Cash with resource (*)	(8,365,082)	(7,365,995)
Net Project Debt with recourse	34,026,921	(1,015,213)
Project debt without recourse (*)	-	-
Project Box without resource (*)	-	-
Net debt of Project without recourse	-	-
Total net debt	41,235,177	3,825,541

(*) Alternative performance measures (MAR) See Appendix I.

3. Significant events in 2019

• In November 2019, the Group issued bonds under the "2019 Grenergy fixed-income renewable energy program" in the nominal amount of 22,000,000 euros at a 4.75% interest rate, maturing in November 2024.
• Also, during November 2019, the Group entered into a project finance agreement in the amount of 53.8 million euros with Banco Security, Banco del Estado de Chile and Penta Vida Compañía de Seguros de Vida for the construction of a new 103 MW solar farm based in Quillagua (Chile).
• In November of this year, the Group arranged its first energy sale framework agreement in Spain with Galp, encompassing between 300-360 GW-hour. The above agreement will pave the way for subscribing PPAs for a group of PV solar energy projects totaling 200MW in Spain, to progressively be assigned to Galp's sales activities starting August 2021, for a 12-year period. Although the Group may supply energy through its projects in portfolio, or ones to be incorporated in the future, the plan is for it to be supplied through the Los Escuderos project. Subsequent to signing the agreement, the Group's portfolio of projects in different stages of development in Spain totaled approximately 1 GW.
• On November 15, 2019, authorization was given by the shareholders in general meeting to request exclusion from negotiations of their shares on Spain's Alternative Stock Market, while also soliciting their admission to trading of the shares on the Barcelona, Bilbao, Madrid, and Valencia exchanges, as well as inclusion on the Electronic Trading Platform, among other decisions made.
• On December 10, 2019, a significant event was published on the launch of an accelerated bookbuilding process designed to place 10% of the Parent company's shares on the market, to thereby comply with the necessary free-float requirements to list on the continuous market.
• Another significant event notice was published on December 12, 2019 announcing the result of the above, with a total of 2,429,000 shares at a unitary price of 12.50 euros per share.
• On December 13, 2019, a significant event notice announcing the CNMV's admission to trading of the Grenergy shares on the continuous market. On December 16, the shares were effectively delisted from the Spanish alternative equity market (MAB), with the simultaneous admission to the Madrid, Barcelona, Bilbao, and Valencia stock exchanges, as well as their inclusion on the electronic trading platform.

4. Strategy and targets for upcoming years

From the commencement of its activities, the Group has basically based its business model on the development, financing, and construction of projects. Until the date of preparation of the accompanying consolidated financial statements, all the projects created and built by the Group in Spain and the Latam region have been sold to third parties. This has permitted Grenergy to use funds obtained to foster its inclusion in new projects in its portfolio, and contribute the necessary capital to finance many of these, so as to be able to construct and operated the same portfolio attained in the ready-to-build phase. The Group also developed O&M services covering asset management in the majority of the projects transferred to third parties, which has generated recurring revenue from the moment the first plants were started up in Spain.

Without prejudice to the focus on continual growth of the abovementioned "build to sell" business model, the Group intends to base part of its future business on the design, construction, and operation of its own projects in Spain and Latin America, so as to generate and obtain recurring income from the sale of energy generated by these projects in the medium and long term. The Group will retain ownership of certain build-to-own projects. Thus, the projects stages of development will rotate (subject to construction), to consolidate a project portfolio serving as the foundation for future recurring income once they are connected to the grid. This involves selling energy directly to the market, or certain buyers under bilateral energy purchase-sale agreements, and other energy sale framework agreements at predetermined prices, or by using bankable price-stabilization regimes.

In addition to its solar/wind energy generation activity, the Group plans to add storage to its services: saving energy produced by intermittent renewable sources, in order to then sell it at auction, and take advantage of other remuneration schemes. The Group is currently implementing a pilot project in Chile, in which it is developing and building a photovoltaic solar plant with battery bank storage facilities; at the state of approval of the accompanying annual financial statements, no objectives had been set.

The Group's strategic objectives for 2020 include: (i) develop solar, wind, and storage of photovoltaic activity; (ii) have a project portfolio of over 5,000 MW; and (iii) build and produce over 363 MW in the upcoming 15 months as Independent Power Producer ("IPP"). The 2022 target is to operate 1,323 MW of installed generation capacity for both photovoltaic as well as wind farms located in the different countries where the Grenergy Group operates (Spain, Chile, Mexico, Peru, Colombia, and Argentina).

5. Administrative, management and supervisory bodies, and senior management

Board of Directors

Below is a description of Grenergy's Board of Directors at the date of preparation of these consolidated financial statements, indicating the positions filled by each member:

			Shareholder that proposed	Date of first	Expiring
Name	Position	Type	their appointment	appointment	date
D. David Ruiz de Andrés	President/ CEO	Executive	Daruan Group Holding, S.L.	05/19/2015	11/15/2023
D. Antonio Jiménez Alarcón	Vocal	Executive	--	11/15/2019	11/15/2023
D. Florentino Vivancos Gasset	Board member	Dominical	Daruan Group Holding, S.L.	05/19/2015	11/15/2023
		Independent
Dña. Ana Peralta Moreno	Vocal	Coordinator	--	06/27/2016	11/15/2023
D. Nicolás Bergareche Mendoza	Vocal	Independent	--	06/27/2016	11/15/2023
Dña. María del Rocío Hortigüela
Esturillo	Vocal	Independent	--	11/15/2019	11/15/2023

As a result of the request for admission to trading of the Parent's shares on the stock exchange, during their general meeting held on November 15, 2019, the shareholders agreed to amend certain bylaws, as well as its General Meeting Regulations to adapt them to applicable regulations for listed companies. On October 1, 2019, the Parent's Board of Directors approved the Board of Directors' regulations, which was reported during the abovementioned General Shareholders' Meeting. The regulations for the General Shareholders Meetings and Board of Directors became effective on the date the entirety of the Company's shares were issued for trading on the stock exchanges on the Spanish continuous market.

During the Parent's General Shareholders' Meeting held on November 15, 2019, six board members were appointed. At the date of preparation of the accompanying consolidated financial statements, the Board was comprised of six members.

On November 15, 2019, the Board agreed to appoint Ms. Ana Peralta Moreno Lead Independent Director. As indicated in the Parent's Board of Directors' regulations, it is especially entitled to the following (among others): (i) call Board meetings, (ii) add items to an established meeting agenda, (iii) coordinate and gather all non-executive directors, and (iv) oversee periodic assessments by the Chairman of the Board, where applicable.

Executives

Group directors (understood as those who report directly to the Board of Directors and/or the CEO) at the date of preparation of these consolidated financial statements follow:

Name	Position
Mr. David Ruiz de Andrés	Chief Executive Officer (CEO)
Mr. Antonio Jiménez Alarcón	Corporate Financial Director (CFO) and Executive Director
Ms. Mercedes Español Soriano	Director of Development and M&A
Mr. Daniel Lozano Herrera	Investor Relations and Communication Director
Mr. Álvaro Ruiz Ruiz	Director of the Legal Area

Average headcount

The average number of employees in 2019, broken down by professional categories, was the following:

Category	2019
Board members and Senior Management	7
Directors Departments	16
Other	64
Total	87

6. Information on the nature and extent of risk arising from financial instruments

The activities of the Group are exposed to various financial risks: market risk (including exchange rate risk), and liquidity risk. The Group's risk management is focused on the uncertainty of financial markets and attempts to minimize the potentially adverse effects on its profitability, using certain financial instruments for this purpose, described further on in the notes. The chief financial risks which might affect the Group are indicated in Note 25.1 of the accompanying notes.

7. Environmental disclosures

One of the stages which characterizes the development of a renewable energy project (albeit solar or eolic in nature) is the performance of studies and statements on the environmental impact installations may exert. The key purpose of the above is to measure and reduce the true impact of executing projects on the environment.

Competent authorities in the different countries in which the Group operates are in charge of preventing environmental damage. Conducting an environmental impact assessment on any activity makes it possible to introduce environmental aspects during project design and execution, as well as the performance of activities carried out in each country. These assessments certify that public- and private-sector initiatives are prepared to comply with applicable environmental requirements.

Although there are a vast array of different environmental impacts, they can be classified into three types according to origin: (i) environmental impact unleashed by taking advantage of natural resources; (ii) the effects of pollution; and (iii) the damage caused by land occupation.

The Group's projects are generally affected by the environmental impact of land occupation. When a project commences, land is sought and located encompassing the essential characteristics necessary to ensure it is not changed during project execution; on occasion environmental improvements are made.

Another effect on the environment which could impact the Group's PP&E is pollution, since some of the machinery used in carrying out its activities belongs to the Group. In this regard, the parties in charge of executing any stage in the development of a project always seek to optimize equipment organization, adapting it to its surroundings.

Depending on each project, the Group hires different consultants and engineering firms to conduct environmental studies which are subsequently reviewed by competent authorities. Once the study in question has been closely reviewed by competent authorities, the decision is made on the suitability of the activity; the conditions and measures to take to correctly protect the environment and natural resources are then determined.

In accordance with prevailing legislation, the Group controls the degree of contamination produced by waste and emissions by applying an appropriate waste disposal policy.

8. Investment in research and development

The Group did not capitalize any amounts during 2019 related to research and development.

9. Treasury shares

With regard to the possibility of acquiring treasury shares, during the General Shareholders' Meeting held on May 19, 2015 a resolution was passed to acquire up to 2,000,000 shares at a price of between 0.01 and 5 euros during the 5-year period commencing that date, in compliance with the Incentive Plans for directors, managers, employees, and collaborators, so that key personnel feel motivated and loyal.

On February 3, 2016, the Board of Directors agreed to purchase treasury shares in Grenergy Renovables S.A. In an amount up to 0.8% of share capital (equivalent to 181,818 shares), to ensure that the Company is adequately covered to grant share options to its directors and employees.

On September 11, 2018, the Parent acquired 365,426 treasury shares from related parties at 2.40 euros/share.

At the date of preparation of the accompanying 2019 financial statements, Grenergy Renovables S.A.'s treasury shares totaled 556,815.

10. Average supplier payment term

In compliance with Law 31/2014, of December 3, which amends additional provision three of Law 15/2010, of July 5, establishing measures to be taken in combating arrears in commercial transactions, the Group reported that the average payment period for the Parent to suppliers was 52.92 days (Note 19).

11. Subsequent events

No subsequent events have been produced from the closing date of the financial statements till the formulation of the financial statements that could modify the content thereof.

12. Final considerations

We'd like to take this opportunity to thank our clients for their confidence in us, as well as our suppliers and strategic partners for their constant support; our investors for having believed in Grenergy since its shares were issued, and especially to our Group's collaborators and employees, since without their efforts and dedication, we would find it difficult to reach established targets or results obtained.

Appendix I: Glossary of alternative performance measures (MAR)

This consolidated management report includes figures considered alternative performance measures (APMs), in conformity with European Securities and Markets Authority (ESMA) directives published in October, 2015.

APMs are presented to reflect financial position more clearly, as well as the Group's cash flows, financial situation, to the extent that Grenergy uses them when making financial, operating, or strategic decisions for the Group. These APMs are not audited, however, nor is it necessary to disclose them in IFRS-EU terms; therefore, they must not be contemplated individually, but rather, as complementary information to the audited financial data, nor should they be subjected to limited reviews prepared in accordance with IFRS-EU standards. The measures may differ in definition as well as similar calculations made by other companies, and therefore, are not considered comparable.

The following is an explanatory glossary of APMs utilized, including calculation methods, and definition/relevance, as well as their reconciliation with items recorded on Grenergy's 2019 and 2018 consolidated financial statements.

ALTERNATIVE PERFORMANCE
MEASURE)	CALCULATION METHOD	DEFINITION/RELEVANCE
Income	"Revenue" + "Work performed by the entity and	Indicates the total volume of income
	capitalized" + "Gains (losses) on disposals and other."	from Group operating activities.
EBITDA	"Operating profit" - "Impairment losses" - "Depreciation and amortization."	Indicates the Group's profit-generation capacity, solely based on its operating activities, eliminating amortization provisions and impairment losses of PP&E.
Net debt	"Non-current borrowings" + "Current borrowings" - "Current financial investments"—"Other financial assets" - "Cash and cash equivalents."	Figure for use in analyzing the Group's financial position.
Bank borrowings, non current	"Bonds and other marketable debt securities" + "Interest-bearing loans and borrowings" + "Finance lease liabilities" - Non-current project bank borrowings.	The amount of financial debt payable by the Group within a year.
Bank borrowings, current	"Current bank borrowings" + "Current finance lease payables" - Current project bank borrowings.	The amount of financial debt payable by the Group within a year.
Cash and cash equivalents	"Cash and cash equivalents"– Project cash.	The amount subtracted from financial debt to obtain net debt.
Recourse project finance	Non-current recourse project finance bank borrowings+ Current recourse project finance bank borrowings	Indicates Parent recourse borrowings
Recourse project treasury	"Cash and equivalent cash assets" – Cash and cash equivalents – Non-recourse project cash.	The amount disbursed by the financing entity attributable to project construction.
Recourse project debt	Non-current non-recourse project finance bank borrowings+ Current non-recourse project finance bank borrowings	Indicates Parent non-recourse borrowings
Non-recourse project treasury	"Cash and equivalent cash assets" – Cash and cash equivalents – Recourse project cash.	The amount disbursed by the financing entity attributable to project construction.

The following is a reconciliation of APMs used (in euros):

Income

RECONCILIATION OF THE INCOME	12/31/2019	12/31/2018
"Revenue"	72,289,630	26,577,205
+ "Work performed by the entity and capitalized"	12,239,733	8,190,763
+ "Gains (losses) on disposals"	516	11,532,405
Total Income	84,529,879	46,300,373
EBITDA
RECONCILIATION OF THE EBITDA	12/31/2019	12/31/2018
"Operating profit"	17,518,566	15,408,130
- "Impairment losses"	(291,320)	(2,174,486)
- "Depreciation and amortization"	(660,945)	(881,431)
Total EBITDA	18,470,831	18,464,047
Net debt
RECONCILIATION OF THE DEBT NET	12/31/2019	12/31/2018
"Long-term financial debt"	67,239,122	9,734,836
+ "Short-term debt"	9,642,204	7,333,584
- "Long-term financial investments"—"Other financial assets"	6,873,062	123,838
- "Cash and cash equivalents"	28,773,087	13,119,041
Total Debt Net	41,235,177	3,825,541
Long-term financial debt
RECONCILIATION OF THE LONG-TERM FINANCIAL DEBT	12/31/2019	12/31/2018
"Obligations and other long-term tradeable values"	21,539,686	-
"Long-term bank borrowings"	41,764,740	9,333,447
+ "Long-term finance lease liabilities"	3,726,447	134,854
- Long-term bank borrowings of project	(40,933,480)	(6,350,782)
Total long-term financial debt	26,097,393	3,117,519
Short-term financial debt
RECONCILIATION OF THE SHORT-TERM FINANCIAL DEBT	31/12/2019	31/12/2018
"Short-term bank borrowings"	4,953,157	6,061,848
+ "Short-term finance lease liabilities"	692,217	27,662
+ "Short-term derivatives"	654,429	27,662
- Short-term bank borrowings of project	(1,458,523)	--
Total short-term financial debt	4,841,280	6,089,510
Cash and cash equivalents
RECONCILIATION OF THE CASH AND CASH EQUIVALENTS	31/12/2019	31/12/2018
"Cash and other cash equivalents assets"	28,773,087	13,119,041
- Cash in hand	(8,365,082)	(7,365,995)
Total cash and cash equivalents	20,408,005	5,753,046

Project debt with recourse

RECONCILIATION OF THE PROJECT DEBT WITH RECOURSE	31/12/2019	31/12/2018
Long-term Project debt with recourse	40,933,480	6,350,782
+Short-term Project debt with recourse	1,458,523	-
Total Project debt with recourse	42,392,003	6,350,782
Project cash with recourse
RECONCILIATION OF THE PROJECT CASH WITH RECOURSE	31/12/2019	31/12/2018
"Cash and other cash equivalents assets"	28,773,087	13,119,041
- Cash and cash equivalents - Project cash without recourse	(20,408,005) -	(5,753,046) -
Total Project cash with recourse	8,365,082	7,365,995
Project cash without recourse
RECONCILIATION OF THE PROJECT CASH WITHOUT RECOURSE	31/12/2019	31/12/2018
"Cash and other cash equivalents assets"	28,773,087	13,119,041
- Cash and cash equivalents	(20,408,005)	(5,753,046)
- Project cash with recourse	(8,365,082	(7,365,995)

Total Project cash without recourse - -

FORMULATION OF THE CONSOLIDATED ANNUAL ACCOUNTS AND MANAGEMENT REPORT FOR THE YEAR ENDED DECEMBER 31, 2019

The consolidated Financial Statements and the consolidated Management Report for the year 2019 were authorized by the Board of Directors of the Parent Company, GRENERGY RENOVABLES, S.A. (Sole Shareholder Company) at its meeting on February 26, 2020, for their verification by auditors and subsequent approval by the shareholders in general meeting.

Mr. Florentino Vivancos Gasset is authorized to sign all pages comprising the consolidated financial statements and the Management Report for 2019.

Signed in the original report issued in Spanish Signed in the original report issued in Spanish ________________________________ _________________________________ D. David Ruiz de Andrés D. Antonio Jiménez Alarcón (Chief Executive Officer) (Board Member) Signed in the original report issued in Spanish Signed in the original report issued in Spanish ________________________________ _________________________________ D. Florentino Vivancos Gasset Dña. Ana Peralta Moreno (Board Member) (Board Member) Signed in the original report issued in Spanish Signed in the original report issued in Spanish ________________________________ _________________________________ D. Nicolás Bergareche Mendoza Dña. María del Rocío Hortigüela Esturillo (Board Member) (Board Member)

Audit Report on Financial Statements issued by an Independent Auditor

GRENERGY RENOVABLES, S.A. Financial Statements and Management Report for the year ended December 31, 2019

AUDIT REPORT ON FINANCIAL STATEMENTS ISSUED BY AN INDEPENDENT AUDITOR

Translation of a report and financial statements originally issued in Spanish. In the event of discrepancy, the Spanish-language version prevails (See Note 24)

To the shareholders of GRENERGY RENOVABLES, S.A.:

Report on the financial statements

Opinion

We have audited the financial statements of GRENERGY RENOVABLES, S.A. (the Company), which comprise the balance sheet as at December 31, 2019, the income statement, the statement of changes in equity, the cash flow statement, and the notes thereto for the year then ended.

In our opinion, the accompanying financial statements give a true and fair view, in all material respects, of the equity and financial position of the Company as at December 31, 2019 and of its financial performance and its cash flows for the year then ended in accordance with the applicable regulatory framework for financial information in Spain (identified in Note 2 to the accompanying financial statements) and, specifically, the accounting principles and criteria contained therein.

Basis for opinion

We conducted our audit in accordance with prevailing audit regulations in Spain. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report.

We are independent of the Company in accordance with the ethical requirements, including those related to independence, that are relevant to our audit of the financial statements in Spain as required by prevailing audit regulations. In this regard, we have not provided non-audit services nor have any situations or circumstances arisen that might have compromised our mandatory independence in a manner prohibited by the aforementioned requirements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key audit matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the current period. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our audit opinion thereon, and we do not provide a separate opinion on these matters.

Valuation of investments in and loans to group companies and associates

Description As explained in Note 8 to the accompanying financial statements, the Company recorded equity instruments and loans to group companies and associates amounting to 29,412 thousand euros and 10,178 thousand euros, respectively in "Non-current investments in group companies and associates."

As explained in Note 4.4.b) to the accompanying financial statements, at least at year end, the Company assesses if there is evidence of impairment and recognizes any impairment loss. Said impairment losses are calculated as the difference between the investment's carrying amount and its recoverable amount, deemed to be the higher of fair value less costs to sell and the present value of the future cash flows from the investment. Unless better evidence is available, impairment losses on these types of assets are estimated taking into account the investee's equity adjusted for any unrealized capital gains existing on the measurement date.

To determine recoverable amount, the directors base their estimates on discounted cash flow analysis, which requires them to make significant judgments with respect to certain key assumptions, particularly, business plan projections and discount rates.

Due to the significance of the amounts involved, as well as the inherent complexity and sensitivity of the estimates made by the complexity, we determined this to be a key audit matter.

Our response Our audit procedures included the following:

• Understanding the criteria established by management to identify indications of impairment.
• Comparing the value of investments in group companies and associates and the related loans with their carrying amounts (equity), adjusted by unrealized capital gains existing at year end to identify indications of impairment.
• Reviewing the consistency and reasonableness of the methodology used to build the cash flow projections by verifying arithmetical calculations of recoverable amount.
• Reviewing the reasonableness of the financial information included in the financial models, based on the judgments and hypotheses made, and the discount rate applied.
• Verifying that the accompanying notes to the financial statements include the information required by the applicable financial reporting framework.

Description	As explained in Note 8.1 to the accompanying financial statements, in 2019, the
	Company signed an agreement with third parties for the sale of several subsidiaries,
	for which it obtained a profit of 6,924 thousand euros. This amount is shown in
	"Impairment and gains/(losses) on disposal of financial instruments" on the
	accompanying income statement.

As explained in Note 4.4b) to the accompanying financial statements, in accordance with the regulatory financial reporting framework applicable in Spain, the Company will derecognize the investment in group companies when the risks and rewards incidental to ownership have been substantially transferred. The difference between the consideration received, net of attributable transaction costs and the carrying amount of the investment in group companies, determines the gain or loss generated upon derecognition and is included in the income statement for the year to which it relates.

Due to the significant impact of the sale of these subsidiaries on the income statement and the complexity of the sale agreements entered into during the year, we determined this to be a key audit matter.

Our response Our audit procedures included the following:

• Understanding the transactions carried out by analyzing the sale agreements reached and holding meetings with Company Management.
• Reviewing the accounting effects arising from the difference between the acquisition cost of the investments in group companies and the value of the consideration received.
• Examining bank statements to verify collection of the sale of the subsidiaries in accordance with the payment schedule stipulated in the sale agreement.
• Verifying that the accompanying notes to the financial statements include the information required by the applicable financial reporting framework.

Balances and transactions with group companies

Description As explained in Note 20.1 to the accompanying financial statements, the Company acts as a supplier to the Group, to which it sells components required for photovoltaic park installations (panels, inverters, etc.) for significant amounts.

Due to the significance of the balances and transactions with group of companies, as well as the risk that the measurement of these transactions might be incorrect and/or questioned in the event of a tax inspection, we determined this to be a key audit matter.

Our response Our audit procedures included the following:

• Understanding transactions between related parties through consultations with management.
• Obtaining supporting documentation for the most significant transactions with related parties to validate the terms and conditions applied as well as whether they were measured at arm's length prices in accordance with prevailing accounting regulations.
• Reconciling balances and transactions with other group companies.
• Involving our tax specialists to analyze the latest transfer pricing report prepared by the Company with its tax advisers.
• Verifying that the accompanying notes to the financial statements include the information required by the applicable financial reporting framework.

Other information: management report

Other information refers exclusively to the 2019 management report, the preparation of which is the responsibility of the Company's directors and is not an integral part of the financial statements.

Our audit opinion on the financial statements does not cover the management report. In conformity with prevailing audit regulations in Spain, our responsibility in terms of the management report is to assess and report on the consistency of the management report with the financial statements based on the knowledge of the entity we obtained while auditing the financial statements, and not including any information not obtained as evidence during the course of the audit. In addition, our responsibility is to assess and report on whether the content and presentation of the management report are in conformity with applicable regulations. If, based on the work carried out, we conclude that there are material misstatements, we are required to disclose them.

Based on the work performed, as described in the above paragraph, the information contained in the management report is consistent with that provided in the 2019 financial statements and their content and presentation are in conformity with applicable regulations.

Other matters

On April 3, 2019 other auditors issued their audit report on the 2018 financial statements, in which they expressed an unqualified opinion.

Responsibilities of the directors and the audit committee for the financial statements

The directors are responsible for the preparation of the accompanying financial statements so that they give a true and fair view of the equity, financial position and results of the Company, in accordance with the regulatory framework for financial information applicable to the Company in Spain, identified in Note 2 to the accompanying financial statements, and for such internal control as they determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

The audit committee is responsible for overseeing the Company's financial reporting process.

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion.

Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with prevailing audit regulations in Spain will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

As part of an audit in accordance with prevailing audit regulations in Spain, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
• Conclude on the appropriateness of the director's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Company to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

We communicate with the audit committee of the Company regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide the audit committee of the Company with a statement that we have complied with relevant ethical requirements, including those related to independence, and to communicate with them all matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with the audit committee of the Company, we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters.

We describe these matters in our auditor's report unless law or regulation precludes public disclosure about the matter.

Report on other legal and regulatory requirements

Additional report to the audit committee

The opinion expressed in this audit report is consistent with the additional report we issued to the audit committee on February 26, 2020.

Term of engagement

The ordinary general shareholders' meeting held on June 17, 2019 appointed us as Group auditors for three years, commencing on December 31, 2019.

ERNST & YOUNG, S.L. (Registered in the Official Register of Auditors under No. S0530)

(signed in the original version)

David Ruiz-Roso Moyano (Registered in the Official Register of Auditors under No. 18336)

___________________________

February 26, 2020

FINANCIAL STATEMENTS AND MANAGEMENT REPORT FOR THE YEAR ENDED DECEMBER 31, 2019

Translation of a report issued in Spanish. In the event of a discrepancy, the Spanish language version prevails.

Financial Statements for the year ended December 31, 2019

GRENERGY RENOVABLES, S.A.

BALANCE SHEET AT DECEMBER 31, 2019 AND 2018

(Euros)

	Notes to the	Financial Year Financial Year			Notes to the		Financial Year Financial Year
ASSETS	financial statements	2019	2018 (*)	EQUITY AND LIABILITIES	financial statements	2019	2018 (*)
NON-CURRENT ASSETS		41,057,346	13,371,329 EQUITY			35,181,470	27,154,252
				CAPITAL AND RESERVES		35,181,470	27,154,252
Intangible assets	5	70,720		3,093 Share capital	12.1	8,507,177	3,645,933
Software		70,720		3,093 Issued capital		8,507,177	3,645,933
				Share premium	12.2	6,117,703	6,117,703
Property, plant, and equipment	6	644,883		327,759 Reserves and retained earnings	12.3	16,703,061	12,726,160
Plant and other PP&E		644,883		327,759 Legal reserve		729,187	729,187
				Voluntary reserves		15,973,874	11,996,973
Investments in group companies and associates	8.1	39,474,745		12,349,619 (Own shares and equity holdings)	12.3	(3,328,497)	(2,062,969)
Equity instruments		29,296,646		11,493,997 Profit for the year		7,182,026	6,727,425
Loans to group companies and associates	20.1	10,178,099	855,622
				NON-CURRENT LIABILITIES		22,710,798	3,384,055
Financial investments	8.2	24,000		26,040 Non-current payables		22,710,798	3,384,055
Other financial assets		24,000		26,040 Bonds and other marketable securities	13.1	21,539,687	-
				Bank borrowings	13.2 and 13.3	831,260	2,982,665
Deferred tax assets	16	842,998		664,818 Finance lease liabilities	7.1	131,602	134,854
				Other financial liabilities	13.4	208,249	266,536
CURRENT ASSETS		48,630,700		38,453,315 CURRENT LIABILITIES		31,795,778	21,286,337
Inventories	9	1,692,133	1,116,306
Raw materials and other consumables		872,111		1,115,309 Borrowings		6,868,629	7,330,185
Work in progress		820,022		- Bank borrowings	13.2 and 13.3	3,493,301	6,058,449
Advances to suppliers		-		997 Finance lease liabilities	7.1	32,927	27,662
Trade and other receivables	10	18,531,402		26,569,024 Other financial liabilities	13.4	3,342,401	1,244,074
Trade receivables		64,561	3,746,848
Trade receivables from group companies and associates	20.1	16,178,806		16,062,110 Payables to group companies and associates	14 and 20.1	242,988	2,773,719
Other receivables		1,651,195	6,524,215
Receivable from employees		-		494 Trade and other payables		24,684,161	11,182,433
Public entities, other	16	636,840		235,357 Suppliers		17,412,657	7,096,642
Investments in group companies and associates	8.1 and 20.1	3,933,100		2,449,123 Suppliers, group companies, and associates	20.1	5,436	27,759
Loans to group companies and associates		3,933,100		2,449,123 Other payables		1,543,743	1,321,583
Financial investments	8.2	6,857,767		- Employee benefits payable		415,669	398,660
Other financial assets		6,857,767		- Current tax liabilities	16	525,521	-
Accruals		206,844		62,539 Other payables to public administrations	16	200,859	74,051
Cash and cash equivalents	11	17,409,454		8,256,323 Customer advances	10	4,580,276	2,263,738
Cash in hand		17,409,454	8,256,323
TOTAL ASSETS		89,688,046	51,824,644	TOTAL EQUITY AND LIABILITIES		89,688,046	51,824,644

(*)Restated figures for comparative purposes (Note 2.5)

The accompanying Notes 1 to 24 and the Appendixes are an integral part of the financial statement of financial position at 31 December 2019 and 2018.

INCOME STATEMENT FOR THE YEARS ENDED DECEMBER 31, 2019 and 2018

(Euros)

	Notes to the		Financial Year Financial Year
	financial statements	2019	2018 (*)
CONTINUING OPERATIONS
Revenue	22	54,862,112	23,535,827
Sales	20.1	54,625,015	23,304,156
Rendering of services		237,097	231,671
Changes in inventory of finished products and work in progress		820,022	-
Cost of sales	17	(48,123,539)	(18,917,293)
Consumption of goods for resale		(48,123,539)	(18,917,293)
Other operating income		1,057,831	604,788
Ancillary income		1,057,831	604,788
Employee benefits expense		(2,921,315)	(1,816,759)
Wages, salaries, et al		(2,275,416)	(1,468,155)
Social security costs	17	(645,899)	(348,604)
Other operating expenses		(2,563,675)	(1,362,363)
External services		(2,559,971)	(1,312,350)
Taxes		(3,704)	(3,400)
Losses on, impairment of, and changes in trade provisions		-	-
Other current management expenses		-	(46,613)
Depreciation and amortization	5 and 6	(93,989)	(50,922)
Impairment losses and gains (losses) on disposal of non-current assets	6	516	(448)
Gains (losses) on disposals and other		516	(448)
Other gains (losses)		(19,223)	25,527
OPERATING PROFIT		3,018,740	2,018,357
Finance income	17	499,708	106,720
From marketable securities and other financial instruments		499,708	106,720
Of group companies and associates	20.1	439,712	96,793
Of third parties		59,996	9,927
Finance costs	17	(1,038,917)	(549,096)
Third-party borrowings		(1,038,917)	(498,764)
Borrowings from group companies and associates		-	(50,332)
Exchange gains (losses)	17	(73,776)	(246,588)
Impairment and gains (losses) on disposal of financial instruments	8.1 and 17	6,623,212	7,040,549
Impairment and losses		(300,417)	(2,300,846)
Gains (losses) on disposals and other		6,923,629	9,341,395
FINANCE COST		6,010,227	6,351,585
PROFIT BEFORE TAX		9,028,967	8,369,942
Corporate income tax	16	(1,846,941)	(1,642,517)
PROFIT FOR THE YEAR FROM CONTINUING OPERATIONS		7,182,026	6,727,425
PROFIT FOR THE YEAR		7,182,026	6,727,425

(*)Restated figures for comparative purposes (Note 2.5)

The accompanying Notes 1 to 24 and the Appendixes are an integral part of the financial statement of financial position at 31 December 2019 and 2018.

STATEMENT OF CHANGES IN EQUITY FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

A) STATEMENT OF RECOGNIZED INCOME AND EXPENSES

(Euros)

	Notes to the	Financial Year Financial Year
	financial statements	2019	2018 (*)
PROFIT FOR THE PERIOD (I)	3	7,182,026	6,727,425
Income and expense recognized directly in equity		-	-
IV. Other adjustments		-	-
V. Tax effect		-	-
TOTAL INCOME AND EXPENSE RECOGNIZED DIRECTLY IN EQUITY (II)		-	-
		-	-
Amounts transferred to the income statement		-	-
TOTAL AMOUNTS TRANSFERRED TO INCOME STATEMENT (III)		-	-
		-	-
TOTAL RECOGNIZED INCOME AND EXPENSE (I+II+III)		7,182,026	6,727,425

(*)Restated figures for comparative purposes (Note 2.5)

The accompanying Notes 1 to 24 and the Appendixes are an integral part of the financial statement of financial position at 31 December 2019 and 2018.

GRENERGY RENOVABLES, S.A. STATEMENT OF CHANGES IN EQUITY FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018 B) STATEMENT OF ALL CHANGES IN EQUITY

(Euros)

	Share capital (Note 12.1)	Share premium (Note 12.2)	Reserves (Note 12.3)	(Own shares and equity holdings) (Note 12.3)	Profit for the year (Note 3)	TOTAL
BALANCE AT DECEMBER 31, 2017	3,645,933	6,117,703	9,997,553	(1,133,498)	1,916,442	20,544,133
Adjustments for changes in criteria and misstatements	-	-	-	-	-	-
ADJUSTED OPENING BALANCE 2018
	3,645,933	6,117,703	9,997,553	(1,133,498)	1,916,442	20,544,133
Total recognized income and expense	-	-	-	-	8,991,163	8,991,163
Transactions with partners or owners	-	-	-	-	-	-
Capital increases	-	-	-	-	-	-
Transactions with treasury shares or own equity instruments (net)	-	-	812,165	(929,471)	-	(117,306)
Other changes in equity	-	-	1,916,442	-	(1,916,442)	-
BALANCE AT DECEMBER 31, 2018	3,645,933	6,117,703	12,726,160	(2,062,969)	8,991,163	29,417,990
Adjustments for changes in criteria and misstatements	-	-	-	-	(2,263,738)	(2,263,738)
ADJUSTED OPENING BALANCE 2019	3,645,933	6,117,703	12,726,160	(2,062,969)	6,727,425	27,154,252
Total recognized income and expense	-	-	-	-	7,182,026	7,182,026
Transactions with partners or owners	-	-	-	-	-	-
Capital increases	4,861,244	-	(4,861,244)	-	-	-
Transactions with treasury shares or own equity instruments (net)	-	-	2,110,720	(1,265,528)	-	845,192
Other changes in equity	-	-	6,727,425	-	(6,727,425)	-
BALANCE AT DECEMBER 31, 2018	8,507,177	6,117,703	16,703,061	(3,328,497)	7,182,026	35,181,470

The accompanying Notes 1 to 24 and the Appendixes are an integral part of the financial statement of financial position at 31 December 2019 and 2018.

Financial Statements for the year ended December 31, 2019

GRENERGY RENOVABLES, S.A.

CASH FLOW STATEMENT FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

(Euros)

A) CASH FLOWS FROM OPERATING ACTIVITIES 1. Profit before tax 9,028,967 2. Adjustments to profit 1,171,170 (6,300,215) a) Depreciation and amortization (+) 5 and 6 93,989 50,922 e) Gains (losses) from derecognition and disposal of non-current assets (+/-) (516) f) Gains (losses) from derecognition and disposal of financial instruments (+/) 8.1 25,000 (7,040,549) g) Finance income (-) 17 (59,996) (106,720) h) Finance expenses (+) 17 1,038,917 549,096 i) Exchange gains (losses) (+/-) 17 73,776 246,588 3. Changes in working capital. Diferencia N - N-1 20,745,442 1,734,195 a) Inventories (+/-) (575,827) (913,853) b) Trade and other receivables (+/-) 8,037,622 (296,722) c) Other current assets (+/-) (144,305) 28,705 d) Trade and other payables (+/-) 13,427,952 2,916,065 4. Other cash flows from operating activities (3,004,042) (2,722,198) a) Interest paid (-) (1,038,917) (498,764) c) Interest received (+) 59,996 9,927 d) Income tax receipts (payments) (+/-) 16 (2,025,121) (2,233,361) 5. Cash flows from operating activities (+/-1+/-2+/-3+/-4) 27,941,537 1,081,724 B) CASH FLOWS FROM INVESTING ACTIVITIES 6. Payments on investments (-) (36,008,809) (198,100) a) Group companies and associates 8.1 (28,609,103) - b) Intangible assets 5 (81,501) - c) Property, plant, and equipment 6 (437,478) (198,100) e) Other financial assets (6,880,727) - 7. Proceeds from disposals (+) 40,755 3,691,391 a) Group companies and associates 8.1 - 3,672,900 c) Property, plant, and equipment 6 40,755 18,491 8. Cash flows from (used in) investing activities (7-6) (35,968,054) 3,493,291 C) CASH FLOWS FROM FINANCING ACTIVITIES 9. Proceeds from and payments on equity instruments 12 845,192 (117,306) c) Acquisition of own equity instruments (3,882,063) (1,869,232) d) Disposal of own equity instruments 4,727,255 1,751,926 10. Proceeds from and payments of financial liabilities 16,334,456 3,494,721 a) Issuance of: 13 23,638,014 4,240,563 1. Bonds and other marketable debt securities (+) 21,539,687 2. Bank borrowings (+) - 4,240,563 4. Other borrowings (+) 2,098,327 - b) Repayment and redemption of 13 (7,303,558) (745,842) 1. Bonds and other marketable debt securities (-) 2. Bank borrowings (-) (4,714,540) - 3. Borrowings from group companies and associates (-) (2,530,731) (745,842) 4. Other borrowings (-) (58,287) - 12. Cash flows from financing activities (+/-9+/-10-11) 17,179,648 3,377,415 E) NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (+/-A+/-B+/-C+/- D) 9,153,131 7,952,430 Cash and cash equivalents at beginning of period 11 8,256,323 303,893 Cash and cash equivalents at end of year 11 17,409,454 8,256,323	Notes	2019	2018 (*)
			8,369,942
			448

(*) Restated figures for comparative purposes (Note 2.5)

The accompanying Notes 1 to 24 and the Appendixes are an integral part of the financial statement of financial position at 31 December 2019 and 2018.

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

1. Activity

GRENERGY RENOVABLES, S.A. ("the Company") was incorporated in Madrid on July 2, 2007 via public deed, as filed at the Mercantile Registry of Madrid in Tome 24.430, Book 0, Folio 112, Section 8, Page M-439.423, 1st inscription. On November 15, 2019 the Company changed its registered business and tax address to Rafael Botí, nº 26 in Madrid.

The corporate purpose of the Company and the sectors in which it performs its activities are as follows: the promotion and commercialization of renewable energy installations, production of electric energy and any complementary activities, including the management and operation of such installations.

As described in Note 12, the Company is a member of the Daruan group, the parent of which is Daruan Group Holding, S.L., which has its registered address at calle Rafael Botí no. 2, Madrid.

The Daruan group's consolidated financial statements corresponding to the year ended December 31, 2018, as well as the corresponding management report and audit reports, were filed at the Mercantile Registry of Madrid on July 29, 2019. The Daruan group's consolidated financial statements corresponding to the year ended December 31, 2019, as well as the corresponding management and audit reports, will be filed at the Madrid Mercantile Registry.

The shares of the Company were listed on the Spanish Alternative Stock Market for Expanding Companies ("MAB-EE") on July 8, 2015. As a consequence of its admission to trading on the MAB-EE, the Company lost its status as a sole shareholder company, which had been declared during 2014. On November 15, 2019 the Company's shareholders in general meeting approved, amongst other matters, to request the delisting of its shares on the MAB-EE and, simultaneously, request their listing on the Stock Exchanges of Barcelona, Bilbao, Madrid, and Valencia, and their inclusion on the Spanish electronic trading platform (Sistema de Interconexión Bursátil Español). As a consequence of the above, the Board of Directors of Bolsas y Mercados Españoles, Sistemas de Negociación, S.A. agreed to delist the 24,306,221 shares of the Company on said market, effective from December 16, 2019, the same date on which the Company's shares were admitted to trading on the Stock Exchanges of Madrid, Barcelona, Bilbao, and Valencia (Note 12).

As disclosed in Note 8, the Company holds shares in subsidiaries and is the head of a group of companies which comprise the Grenergy Group. The consolidated financial statements of the Grenergy Group corresponding to the year ended December 31, 2019, as well as the corresponding management and audit reports, will be filed at the Madrid Mercantile Registry.

2. Basis of presentation of the Financial Statements

2.1. True and fair view

The financial statements for the year ended December 31, 2019 were prepared based on the accounting registers of the Company and give a true and fair view of its equity and financial position, the results of its operations, the changes in equity and cash flows during the period. They were prepared by the directors of the Company in accordance with the applicable regulatory framework for financial information, as established in:

• a) The Spanish Code of Commerce and remaining mercantile legislation
• b) Spanish GAAP approved by Royal Decree 1514/2007, partially modified by Royal Decree 1159/2010 of September 17 and Royal Decree 602/2016 of December 2, and its sector adaptations.
• c) Binding rules approved by the ICAC (Instituto de Contabilidad y Auditoría de Cuentas - Spanish Audit and Accounting Institute) enacting Spanish GAAP and its complementary regulations.
• d) Other applicable Spanish accounting regulations.

Amongst the modifications introduced in the final first provision of Royal Decree 877/2015 of October 2 with respect to Royal Decree 1517/2011 of October 31, which approved the enacting regulations set forth in the revised text of the Audit Law, the amendment to article 15 of said Law is included, defining public interest entities to include the entities which issue securities listed on the MAB-EE.

The Company's financial statements for the year ended December 31, 2018 were approved by the shareholders in general meeting on June 17, 2019. The accompanying 2019 financial statements, prepared by the directors, will be submitted for approval at the general shareholders meeting, where they are expected to be approved without modification.

2.2. Non-obligatory accounting principles applied

The main accounting principles adopted by the Company are presented in Note 4. All accounting principles or recognition and measurement standards with a significant effect on the financial statements were applied in their preparation.

The figures included in all statements comprising the financial statements (balance sheet, income statement, statement of changes in equity, cash flow statement, and the accompanying notes) are presented in euros, the functional currency of the Company, unless indicated otherwise.

2.3. Critical issues regarding the measurement and estimation of uncertainty

The preparation of certain information included in the accompanying financial statements required the use of estimates based on assumptions made by senior management, subsequently ratified by the directors of the Company. These disclosures required the quantification of certain assets, liabilities, income, expenses, and commitments contained in the financial statements.

The most significant estimates used to prepare these financial statements relate to:

• · Impairment losses on equity instruments (Note 8.1).
• · Valuation at market prices of transactions with related parties (Note 20.1).

These estimates and hypotheses are based on the best information available at the date of preparation of these financial statements regarding the estimation of uncertainty at the reporting date and are reviewed periodically. However, it is possible that these periodic reviews or future events may require the Company to modify the estimates made in coming periods. Should this occur, the effects of the changes in estimates shall be recognized prospectively in the income statement of the corresponding period and successive periods in accordance with the stipulations established in Spanish GAAP recognition and measurement rule 22 on changes in accounting criteria, errors, and estimates.

2.4. Comparative information

In accordance with commercial legislation, it is presented, for comparative purposes, with each of the items in the statement of financial position, the income statement, the statement of changes in equity and the statement of cash flows are presented, in addition to the figures for fiscal year 2019, those corresponding to the previous fiscal year. The attached financial statement also includes quantitative information from the previous fiscal year, except when an accounting standard specifically states that it is not necessary.

The figures included for the year ended December 31, 2018 differ from those presented in the corresponding annual financial statements for 2018 as authorized by the Company's Board of Directors on March 29, 2019 (Note 2.5).

2.5. Corrections of errors

During the second half of 2019 the Company initiated the process for admission to trading of all shares representing its share capital on the Stock Exchanges of Madrid, Barcelona, Bilbao, and Valencia. During said process, the National Securities Exchange Commission ("CNMV" from the Spanish "Comisión Nacional del Mercado de Valores") issued recommendations regarding recognition of certain development and construction purchase-sale contracts with respect to applying a different professional judgment on the transfer of risks and benefits associated with an asset in the analysis of control. During the second half of 2018, the Company recognized the sale of shares in a company with the complete conclusion of a solar farm development in Chile ("ready to build") as it considered that all risks and benefits of said company had been transferred. Given that the purchase-sale contract for said shares included a cancellation clause, it was not irrevocable.

As a consequence, the Company corrected this error retroactively, changing the 2018 figures as well as the initial reserves for 2019.

The effects of these corrections were as follows:

STATEMENT OF FINANCIAL POSITION	12.31.2018	Adjustments	12.31.2018 Restated
EQUITY
Profit for the year	8,991,163	(2,263,738)	6,727,425
Trade and other payables Customer advances	8,918,695 -	2,263,738 2,263,738	11,182,433 2,263,738
TOTAL EQUITY AND LIABILITIES	51,824,644	-	51,824,644
INCOME STATEMENT	12.31.2018	Adjustments	12.31.2018 Restated
OPERATING PROFIT	2,018,357	-	2,018,357
Gains (losses) on disposals and other	11,605,133	(2,263,738)	9,341,395
FINANCE COST	8,615,323	(2,263,738)	6,351,585
PROFIT FOR THE YEAR	8,991,163	(2,263,738)	6,727,425
CASH FLOW STATEMENT	12.31.2018	Adjustments	12.31.2018 Restated
Profit before tax	10,633,680	(2,263,738)	8,369,942
Adjustments to profit	(8,563,953)	2,263,738	(6,300,215)
Changes in working capital	(529,543)	2,263,738	1,734,195
Proceeds from disposals	5,955,129	(2,263,738)	3,691,391
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	7,952,430	-	7,952,430

3. Appropriation of profit

The proposal of distribution of results formulated by the Board of Directors of the Company that will be submitted for approval by the General Meeting of Shareholders, is as follows:

	Euros
Proposed appropriation
Profit for the year	7,182,026
	7,182,026
Appropriation to:
Legal reserve	718,203
Voluntary reserves	6,225,381
Capitalization reserves	238,442
	7,182,026

4. Recognition and measurement principles

The recognition and measurement standards used in preparing the financial statements for 2019 are as follows:

4.1. Intangible assets

Intangible assets are considered to be identifiable non-monetary assets, without physical substance, which arise as a result of a legal business or are developed internally. Only those assets are recognized whose cost can be estimated reliably and from which the Company considers it probable that future economic benefits will be generated.

Intangible assets are initially recognized at acquisition or production cost, and subsequently they are measured at cost less any accumulated amortization and impairment losses.

Software

This heading includes amounts paid to acquire software and licenses to use programs and computer applications, provided the Company plans to use them for several years. They are amortized systematically on a straight-line basis over a period of four years.

Expenses for maintenance or global reviews of the systems, or recurring expenses as a consequence of the modification or upgrading of these applications, are recognized directly as expenses in the year in which they are incurred.

4.2. Property, plant, and equipment

PP&E items correspond to the assets owned by the Company for use in production and the provision of goods and services, or for administrative purposes, and which are expected to be used during more than one period.

The assets comprising PP&E are recognized at acquisition cost (updated as per various legal provisions, if applicable) or production cost, less accumulated depreciation and any impairment losses.

The cost of PP&E constructed by the Company is determined following the same principles as used for acquisitions. Capitalized production costs are recognized under "Work performed by the entity and capitalized" in the income statement.

Costs incurred to expand, upgrade, improve, substitute or renovate PP&E items which increase productivity, capacity or efficiency, or extend the useful life of the asset, are recognized as a greater cost of said assets with the corresponding derecognition of the assets or items that have been substituted or renovated.

The acquisition cost of the PP&E items which require a period of more than one year to be readied for use includes those financial expenses accrued before being readied for use. No corresponding amounts were recorded in this respect during the period. In contrast, finance interest accrued subsequent to said date or related to financing acquisition of the remaining PP&E items does not increase the acquisition cost and is recognized in the income statement for the year in which they accrue.

The costs incurred for refurbishing leased premises are included under the heading for installations, depreciated systematically on a straight-line basis over a period of 8 years and never exceeding the duration of the lease agreement.

Periodic expenses relating to conservation, repairs, and maintenance that do not increase the useful lives of assets are charged to the income statement for the year in which they are incurred.

Depreciation is calculated systematically on a straight-line basis over the estimated useful life of each asset, based on the acquisition or production cost less the residual value, as follows:

	Years of useful life
Machinery	5-10
Plant and tools	5-12
Transport equipment	5-10
Furniture and fixtures	10
Data processing equipment	4
Other PP&E	6-8

The values and remaining life of these assets are reviewed at each reporting date and adjusted if necessary.

At the end of each period, the Company analyzes whether there are any indications that the carrying amounts of its PP&E assets exceed their corresponding recoverable amounts, that is, whether any of them are impaired. For those assets identified, it estimates the recoverable amount, which is understood to be the greater of fair value less necessary sales costs and value in use. In the case of an asset that does not generate cash flows independently of other assets, the Company calculates the recoverable amount for the cash generating unit to which it belongs.

If the recoverable amount thus determined is lower than the asset's carrying amount, the difference is recognized in the income statement, reducing the carrying amount of the asset to the recoverable amount, and future depreciation charges are adjusted in proportion to the adjusted carrying amounts and the new remaining useful life, should a new estimate be necessary.

Similarly, if there is any indication of recovery in the value of an impaired asset, the Company recognizes the reversal of the impairment loss previously recorded and adjusts the future depreciation charges accordingly. Under no circumstances will said reversal result in an increase in the carrying amount of the asset exceeding that amount that would have been recognized had no impairment losses been recognized in previous years.

The gain or loss arising from disposal or derecognition of a PP&E item is calculated as the difference between the consideration received and the carrying amount of the asset, and is included in the income statement of the year in which the change occurs.

4.3. Leases

Contracts are classified as financial leases when it is deduced from their economic conditions that substantially all the risks and rewards inherent in the ownership of the asset object of the contract are transferred to the lessee. Otherwise, the contracts are classified as operating leases.

Company as a lessee

Assets acquired through a financial lease are recorded according to their nature, due to the lower between the fair value of the asset and the current value at the beginning of the lease of the agreed minimum payments, including the purchase option, accounting for a financial liability for the same amount. The quotas of a contingent nature, the cost of the services and the taxes payable by the lessor are not included in the calculation of the agreed minimum payments. The payments made by the lease are distributed between the financial expenses and the reduction of the liability. The total financial burden of the contract is charged to the profit and loss account for the year in which it accrues, applying the effective interest rate method. The same depreciation, impairment and retirement criteria are applied to the assets as the rest of its nature's assets.

Payments for operating leases are recorded as expenses in the profit and loss account when accrued.

Company as lessor

Income derived from operating leases is recorded in the profit and loss account when accrued. The direct costs attributable to the contract are included as a higher value of the leased asset and are recognized as an expense during the term of the contract, applying the same criteria used to recognize the income of the lease.

4.4. Financial Instruments

A financial instrument is any contract that simultaneously gives rise to a financial asset for one entity and a financial liability or equity instrument for another entity. The Company only recognizes financial instruments in the balance sheet when it becomes a party to the contractual provisions of the instrument.

Financial assets and liabilities are classified as current in the accompanying balance sheet depending on whether their maturity is equal to or less than twelve months from the reporting date. In the case of longer maturities, they are classified as non-current.

The financial assets and liabilities which the Company most frequently owns are the following:

• · Financing granted to related parties and personnel of the Company, regardless of the legal manner in which this occurs
• · Trade receivables
• · Financing received from financial institutions and suppliers

· Securities, both those representing debt (obligations, bonds, letters of credit, etc.) or equity instruments of other entities (shares) or interests held in collective investment institutions.

a) Financial assets

Financial instruments are initially measured at fair value plus any incremental costs directly attributable to the transaction, except when the assets are classified as held for trading, in which case, the accrued costs are taken directly to the income statement of the year in which they are incurred.

For measurement purposes the Company classifies financial assets, except for investments held in group companies, jointly controlled entities, or associates, in one of the following categories:

· Loans and receivables: These balances correspond to receivables (trade and nontrade) which are not derivatives, are not traded on an active market, correspond to fixed or determinable cash flows, and which are expected to recover the entire initial disbursement, except when there are reasons attributable to the solvency of the debtor. They arise when the Company provides cash or goods and services related to its corporate purpose directly to a debtor without any intention of trading the account receivable. Security deposits and guarantees are also recognized under this heading at their nominal amounts given that they do not significantly differ from fair value.

After initial recognition, these items are measured at amortized cost using the effective interest rate method. However, in general, trade receivables maturing in less than twelve months are recognized at their nominal values, that is, they are not discounted.

Amortized cost is the acquisition cost of the asset less principal repayments, adjusted (upwards or downwards) by the amount systematically allocated to the income statement corresponding to the difference between the initial cost and the corresponding liquidation value at maturity, taking into account any impairment losses.

Likewise, the effective interest rate is the rate that at the asset's acquisition date exactly discounts all estimated future cash payments or receipts throughout the expected life of the financial instrument.

It is Company policy to recognize impairment losses with a view to covering balances of a certain age or those balances for which circumstances exist which warrant their classification as doubtful debts.

b) Investments in group companies, jointly-controlled entities, and associates

As indicated in Note 8, the Company directly or indirectly controls certain entities. In general, regardless of the interests held, the Company's interest in the share capital of other companies which are not listed on a stock exchange are measured at acquisition cost less, if applicable, any accumulated impairment losses.

Said impairment losses are calculated as the difference between the investment's carrying amount and its recoverable amount, deemed to be the higher of fair value less costs to sell and the present value of the future cash flows from the investment. Unless better evidence is available, impairment losses on these types of assets are estimated taking into account the investee's equity adjusted for any unrealized capital gains existing on the measurement date.

Impairment losses and any subsequent reversals are recognized as an expense or as income, respectively, in the income statement. Reversal of impairment losses is limited to the original carrying amount of the investment.

The Company derecognizes an investment in group companies, jointly controlled entities or associates when the risks and benefits inherent to ownership of said investment has been substantially transferred. When an investment in group companies, jointly controlled entities or associates is derecognized, the difference between the consideration received, net of attributable transaction costs, including any new asset obtained less any liability assumed, and the carrying amount of said investment, plus any cumulative gain or loss directly recognized in equity, determines the gain or loss generated upon derecognition, and is included in the income statement for the year to which it relates.

c) Financial liabilities

Financial liabilities are classified based on the agreed-upon contractual terms and taking into account the economic substance of the corresponding transactions.

The main financial liabilities held by the Company correspond to held-to-maturity liabilities, which may or may not include remuneration, and which for measurement purposes are classified under "Trade and other payables," initially measuring them at fair value and subsequently at amortized cost.

· Bank borrowings and other remunerated financial liabilities: Loans, bank overdrafts, obligations, bonds, and other similar instruments which accrue interest are initially recognized at fair value, which is equivalent to the cash received net of directly attributable transaction costs incurred. Finance expenses accrued, including premiums payable on settlement or redemption and direct issue costs, are recognized in the income statement using the effective interest rate method, increasing the carrying amount of the financial liabilities to the extent that they are not liquidated during the period in which the expenses accrue. Said expenses likewise include loans at zero interest, recognized at their nominal amounts given that they do not significantly differ from fair value.

Loans repayable in the short term, but whose long-term refinancing is assured at the discretion of the Company through available long-term credit facilities, are classified as non-current liabilities in the accompanying balance sheet.

· Trade receivables: the Company's trade receivables, which in general do not mature in more than one year and do not accrue explicit interest, are recognized at their nominal value, which is not significantly different to their amortized cost.

The Company derecognizes a financial liability, or a part of the financial liability, as soon as the obligations relating to the corresponding contract have either expired or been fulfilled or canceled.

The substantial modifications of initially-recognized financial liabilities are accounted for as a cancellation of the original financial liability and the recognition of a new financial liability, provided the related conditions of the instruments are substantially different. The Company recognizes the difference between the carrying amount of the financial liability that has been canceled or assigned to a third party and the consideration paid, including any assets assigned (other than cash) or liabilities assumed, in the income statement.

d) Own equity instruments

All equity instruments issued by the Company are classified in "Share capital" under "Capital and reserves" in the accompanying balance sheet. The Company does not hold any other own equity instruments.

Said instruments are recognized under equity at the amount received net of direct issue costs.

When the Company acquires or sells own equity instruments, the amount paid or received is recognized directly in net equity accounts, and no amounts are recognized in the income statement for said transactions (Note 12).

e) Cash and cash equivalents

This heading in the accompanying balance sheet includes cash in hand, demand deposits at credit entities, and other short-term highly liquid investments with original maturities of three months or less. Bank overdrafts are classified as borrowings under current liabilities in the accompanying balance sheet.

4.5. Derivative financial instruments and hedge accounting

Company policy does not allow for the use of derivative financial instruments or any hedging transactions.

4.6. Inventories

The Company promotes and constructs photovoltaic solar farms for their subsequent operation and/or sale. Further, the Company recognizes the related costs incurred under "Inventories" in the accompanying balance sheet until all the terms and conditions described in Note 4.9 are met, at which time the sale is recognized.

The photovoltaic solar farm projects are valued at production cost, which is understood to be the costs directly attributable to the project, as well as a reasonable portion of indirect costs.

The Company valued projects under construction at year end and transferred the related attributable costs to "Inventories."

The Company assesses the net realizable value of its inventories at each reporting date, recognizing any impairment losses as required if they are overstated. When the circumstances which gave rise to recognition of impairment losses on inventories no longer hold or there is clear evidence justifying an increase in the net realizable value due to changes in economic circumstances, the previously recognized impairment losses are reversed. This reversal is limited to the lower amount corresponding to cost or the new net realizable value of the inventories. Both impairment losses on inventories as well as their reversal are recognized in the income statement for the period.

The photovoltaic solar farms owned by the Company are initially classified as inventories as the directors consider that under normal circumstances they will be sold. In those cases in which at the outset a decision is taken to operate the photovoltaic solar farm, it is classified under PP&E.

4.7. Transactions and balances in foreign currency

As the Company's functional currency is the euro, all balances and transactions denominated in currencies other than the euro are considered as denominated in foreign currency. Said transactions are recognized in euros applying the spot exchange rates prevailing at the transaction dates.

At financial year end, the monetary assets and liabilities denominated in foreign currencies are converted to euros utilizing the average spot exchange rate prevailing at said date in the corresponding currency markets.

The gains or losses obtained from settling transactions denominated in foreign currency and the conversion at closing date exchange rates of the monetary assets and liabilities denominated in foreign currencies are recognized in the income statement for the year under "Exchange gains (losses)."

4.8. Income tax

Income tax expense for the year is calculated as the sum of current tax, resulting from applying the corresponding tax rate to taxable income for the year (after applying any possible tax deductions), and any changes in deferred tax assets and liabilities.

The tax effect relating to items directly recognized in equity is recognized under equity in the balance sheet.

Deferred taxes are calculated in accordance with the balance sheet method, considering the temporary differences that arise between the tax bases of assets and liabilities and their carrying amounts, applying the regulations and tax rates that have been approved or are about to be approved at the reporting date and which are expected to apply when the corresponding deferred tax asset is realized or deferred tax liability is settled.

Deferred tax liabilities are recognized for all taxable temporary differences except for those arising from the initial recognition of goodwill or other assets and liabilities in a transaction that is not a business combination and affects neither taxable profit or accounting profit. Deferred tax assets are recognized when it is probable that the Company will generate sufficient taxable profit in the future against which the deductible temporary differences or the unused tax loss carryforwards or tax assets can be utilized.

At each reporting date the Company reviews the deferred tax assets and liabilities recognized to verify that they remain in force, making any appropriate adjustments on the basis of the results of the analysis performed.

Until 2018 the Company filed its tax returns under a consolidated regime, together with the parent of the group to which it belongs, Daruan Group Holding, S.L. and the remaining companies that make up the tax group comprised of Daruan Group Holding, S.L. and subsidiaries, with tax identification number 0381/14. As described in Note 12, on December 16, 2019 a private placement of a share package was carried out by virtue of which the interest held by the majority shareholder, Daruan Group Holding, S.L. decreased to 68%. Thus, and as a consequence of the interest held decreasing to below 70%, the Company and its Spanish subsidiaries no longer belong to the tax group Daruan Group Holding, S.L. and subsidiaries, consequently filing their tax returns individually.

4.9. Income and expense recognition

The Company recognizes revenue and expenses on an accrual basis, that is, when the goods or services are actually provided, regardless of when actual collection or payment occurs.

The most significant criteria utilized by the Company for recognition of its revenue and expenses are the following:

§ Revenue from sales and the rendering of services: is measured at the fair value of the consideration received or receivable and represents amounts receivable for goods and services provided in the normal course of business, net of discounts, VAT, and other sales-related taxes.

The sale of goods is recognized as revenue when the risks and rewards inherent to ownership of the goods have been substantially transferred, the results of the transaction can be reliably determined, and it is probable that the Company will receive the economic returns relating to the transaction.

Revenue from the sale of solar farms is recognized at the moment when control over the underlying goods and services related to performance of the contractual terms is transferred to the buyer.

For engineering, procurement, and construction contracts ("EPC contracts") executed on land belonging to third parties, the Company in general recognizes the income and results corresponding to each contract based on the estimated stage of completion as per the percentage of costs incurred with respect to the total costs budgeted. For these purposes the Company also takes into account the existence of resolutory clauses. Losses which may arise on the contracted projects are recognized, in their totality, at the moment said losses become apparent and can be estimated. The difference between revenue recognized for a project and the amount invoiced for that project is recognized in the following manner:

• if it is positive, such as "Work completed pending invoice" (deferred invoicing), under "Trade and other receivables;"
• if it is negative, such as "Advance collections" (early invoicing), under "Customer advances."

Income for services rendered is also recognized considering the degree of completion of these services at the balance sheet date, provided that the result of the transaction can be estimated reliably and it is probable the economic benefits associated with the transaction will flow to the Company.

§ Expenses: are recognized in the income statement when a decrease in future economic benefits related to a decrease in an asset or an increase in a liability has arisen that can be measured reliably. This means that recognition of expenses occurs simultaneously with the recognition of an increase in liabilities or a decrease in assets. Further, expenses are recognized immediately when an outflow does not generate future economic benefits or when the necessary requirements for recognition as an asset are not met.

§ Interest income and expenses and similar items: are generally recognized by applying the effective interest rate method.

Dividends are recognized as income within the "revenue" at the moment the Company acquires the right to receive them, that is, when the competent bodies of the companies in which it holds the investment have approved their distribution.

4.10. Provisions and contingencies

At the date of authorization of the accompanying financial statements the directors of the Company made the following distinctions:

• · Provisions: existing obligations at the reporting date arising from past events that are uncertain as to amount or timing, but for which it is probable that the Company will suffer an outflow of resources which can be reliably estimated.
• · Contingent liabilities: possible obligations arising as a consequence of past events, materialization of which is conditional upon one or more uncertain events occurring in the future not entirely within control of the Company and which do not meet the requirements for recognition as provisions.

The financial statements of the Company present all the significant provisions with respect to which it considers the related obligation will probably have to be met. The provisions are quantified based on the best information available at the reporting date regarding the consequences of the triggering events and taking into account the time value of money, if significant.

Their allocation is made with a charge against the income statement for the year in which the obligation arises (legal, contractual, or implicit), and can be fully or partially reversed with a credit to the income statement when the obligations cease to exist or decrease.

The Company did not recognize any contingent liabilities at year end.

4.11. Environmental assets and liabilities

Environmental assets are classified as those the Company utilizes in its activities over a long period of time whose primary purpose is to minimize the environmental impact and protect or improve the environment, including those assets designed to reduce or eliminate future contamination from the Company's activities.

The criteria for initial recognition, allocation for amortization/depreciation, and possible impairment loss adjustments on said assets are as described in Note 4.2 above.

Given the Company's activities, and in accordance with prevailing legislation, it controls the degree of contamination produced by waste and emissions by applying an appropriate waste disposal policy. Expenses for these purposes are charged to the income statement for the year in which they are incurred.

4.12. Employee benefits expense

Employee benefits expenses include all the Company's duties and obligations of a social nature, whether mandatory or voluntary, recognizing the obligations for bonus salary payments, holidays, and variable remuneration, as well as associated expenses.

a) Short-term employee benefits

This type of remuneration is measured at the undiscounted amount payable in exchange for services received. These benefits are generally recognized as personnel expenses for the year and are presented as a liability in the balance sheet corresponding to the difference between the total expense accrued and the amount settled at the reporting date.

b) Termination benefits

In keeping with prevailing legislation, the Company is obliged to pay indemnities to employees who are dismissed through no fault of their own. Said termination benefits are payable when employment is terminated by the Company before the normal retirement date, or whenever an employee accepts voluntary redundancy in exchange for these benefits. The Company recognizes termination benefits when it has a demonstrable commitment to terminate its current labor contracts under an irrevocable and detailed plan or to provide the benefits as part of an offer to encourage voluntary redundancy.

At year end the Company had no plan to reduce personnel that would require it to record a corresponding provision.

4.13. Payments based on shares and share options

Transactions in which the Company receives goods or services, including services rendered by employees, in exchange for its own equity instruments, or an amount based on the value of its equity instruments, such as share options or share appreciation rights, are considered equity-settled transactions.

The Company recognizes, on the one hand, the goods and services received as an asset or expense, depending on their nature, at the time they are received, and on the other, the corresponding increase in equity, if the transaction is settled using equity instruments, or the corresponding liability, if it is settled in an amount that is based on the value of the equity instruments.

If the Company has the option to settle with equity instruments or in cash, it must recognize a liability to the extent that it has incurred a present obligation to settle in cash or with other assets; alternatively it shall recognize an increase in equity. If the choice corresponds to the supplier of the goods or services, the Company shall recognize a compound financial instrument, which shall include a liability component, for the other party's right to demand payment in cash, and an equity component, for the right to receive the consideration in own equity instruments.

In transactions in which services must be completed throughout a certain period of time, these services shall be recognized as rendered during said period.

In transactions with employees which are settled with equity instruments, both the services rendered and the increase in equity to be recognized shall be measured at fair value of the equity instruments assigned on the grant date.

Equity-settled transactions which relate to goods or services other than those offered by employees shall be measured at the fair value of those goods or services, if this can be measured reliably, at the date received. If the fair value of the goods or services received cannot be reliably measured, the goods or services received and the increase in equity shall be measured at the fair value of the equity instruments granted, on the date the company obtains the goods or the other party renders the services.

After recognition of the goods and services received, as established in the above paragraphs, as well as the corresponding increase in equity, no additional adjustments shall be made to equity after the vesting date.

For cash-settled transactions, the goods or services received and the liability to be recognized shall be measured at the fair value of the liability corresponding to the date on which the recognition requirements are met.

Thereafter, and until settlement, the corresponding liability shall be measured at fair value at each year end, and any changes in value during the year shall be recognized in the income statement.

At December 31, 2019 the Company had granted an incentive plan to its employees consisting of options on its shares. Said plan establishes that the transactions shall be settled via delivery of equity instruments.

4.14. Related party transactions

Commercial or financial transactions carried out with group companies, jointly controlled entities, associates, and other related parties are initially recognized at fair value regardless of the degree of relationship.

4.15. Classification of balances between current and non-current

The Company classifies assets and liabilities in the balance sheet as current and non-current. For these purposes, assets and liabilities are classified as current in accordance with the following criteria:

• Assets are classified as current when they are expected to be realized or are intended for sale or consumption in the Company's normal operating cycle, they are held primarily for trading, they are expected to be realized within twelve months from the reporting date, or are cash or cash equivalents, unless they are restricted from being exchanged or used to settle a liability for at least twelve months after the reporting date.
• Liabilities are classified as current when they are expected to be settled in the Company's normal operating cycle, they are held primarily for the purpose of trading, they are due to be settled within twelve months after the reporting date or the Company does not have the unconditional right to defer settlement of the liability for at least twelve months after the reporting date.
• Financial liabilities are classified as current when they are due to be settled within twelve months after the reporting date, even if the original term was for a period longer than twelve months and an agreement to refinance or to reschedule payments on a long-term basis is completed after the reporting date and before the financial statements are authorized for issue.

5. Intangible assets

The breakdown and movements for this heading during 2019 and 2018 were as follows:

	Software	TOTAL
COST
Balance at 12.31.2017	10,737	10,737
Additions	-	-
Balance at 12.31.2018	10,737	10,737
Additions	81,501	81,501
Balance at 12.31.2019	92,238	92,238
AMORTIZATION
Balance at 12.31.2017	(6,772)	(6,772)
Allowance for the year	(872)	(872)
Balance at 12.31.2018	(7,644)	(7,644)
Allowance for the year	(13,874)	(13,874)
Balance at 12.31.2018	(21,518)	(21,518)
Carrying amount at 12.31.2018	3,093	3,093

The useful lives for these assets and the amortization criteria applied are disclosed in Note 4.1.

Carrying amount at 12.31.2019 70,720 70,720

Fully amortized assets

At 2019 and 2018 year end the Company's intangible assets included fully amortized assets still in use amounting to 6,160 euros.

Intangible assets acquired from group companies and associates

No intangible assets were acquired from group companies or associates in 2019 and 2018.

Impairment loss allowances

The directors of the Company consider that there are no indications of any impairment losses on its intangible assets at 2019 and 2018 year end, thus not recognizing any such losses during either year.

Leases

At December 31, 2019 and 2018, the Company held no intangible assets under finance leases. Likewise, the Company is not party to any operating lease agreements in connection with its intangible assets.

Firm purchase-sale agreements

The Company has no commitments to acquire or sell any intangible assets at significant amounts. Neither are any intangible assets affected by litigation or encumbered as guarantees to third parties.

Insurance

The Company has taken out various insurance policies to cover the risks to which its intangible assets are exposed and considers said coverage as sufficient.

6. Property, plant, and equipment

The breakdown and movements in this balance sheet heading for 2019 and 2018 are as follows:

	Machinery and
	technical installations	Other plant, tools, and furniture	Other PP&E	TOTAL
COST
Balance at 12.31.2017	18,612	284,543	133,072	436,227
Additions	-	5,023	193,077	198,100
Disposals, derecognitions, and reductions		(32,705)	(28,073)	(60,778)
Balance at 12.31.2018	18,612	256,861	298,076	573,549
Additions	14,066	311,455	111,957	437,478
Disposals, derecognitions, and reductions		(2,180)	(77,991)	(80,171)
Balance at 12.31.2019	32,678	566,136	332,042	930,856
DEPRECIATION
Balance at 12.31.2017	(15,694)	(149,373)	(72,511)	(237,578)
Allowance for the year	(1,041)	(19,723)	(29,286)	(50,050)
Decreases	-	20,190	21,648	41,838
Balance at 12.31.2018	(16,735)	(148,906)	(80,149)	(245,790)
Allowance for the year	(1,113)	(20,928)	(58,074)	(80,115)
Decreases			39,932	39,932
Balance at 12.31.2019	(17,848)	(169,834)	(98,291)	(285,973)
Net carrying amount at 12.31.2018	1,877	107,955	217,927	327,759
Net carrying amount at 12.31.2019	14,830	396,302	233,751	644,883

The useful lives for these assets and the depreciation criteria applied are disclosed in Note 4.2.

The main additions during 2019 correspond to furniture and refurbishment work on the new offices, as well as the acquisition of transport equipment. The main additions during 2018 correspond to transport equipment.

The main derecognitions during 2019 and 2018 correspond to furniture and transport equipment.

PP&E acquired from group companies and associates

No PP&E items were acquired from group companies in 2019 and 2018.

Impairment loss allowances

The directors of the Company consider that there are no indications of any impairment losses on the different items comprising its PP&E at 2019 and 2018 year end.

Fully depreciated assets

At 2019 year end, the Company had fully depreciated PP&E items still in use amounting to 30,035 euros (2018: 96,623 euros).

Leases

The heading "Transport equipment" at December 31, 2019 and 2018 presents 177,591 and 182,641 euros, respectively, corresponding to the net carrying amount of transport equipment held under finance lease agreements and which are classified under the corresponding heading according to their nature. The durations of the lease agreements range from 2 to 5 years (Note 7.1).

Firm purchase-sale agreements

The Company has no commitments to acquire or sell PP&E items in significant amounts and neither are any of said assets affected by litigation or encumbered as guarantees to third parties.

Insurance

The Company has taken out various insurance policies to cover the risks to which its PP&E items are exposed. The coverage of these policies is considered sufficient.

7. Leases and other similar transactions

7.1. Finance Leases - Lessee

At December 31,2019 and 2018 the assets acquired by the Company by virtue of finance lease agreements were as follows:

Year ended December 31, 2019

Property, plant, and equipment	Gross value	Accumulated depreciation	Net carrying amount
Transport equipment	226,238	(48,647)	177,591
Total	226,238	(48,647)	177,591

Property, plant, and equipment	Gross value	Accumulated depreciation	Net carrying amount
Transport equipment	206,315	(23,674)	182,641
Total	206,315	(23,674)	182,641

The initial value of said assets corresponds to the lower of fair value of the good and the present value of minimum payments agreed upon, including the purchase option if applicable, at the lease date.

The most significant data at December 31, 2019 and 2018 in connection with the goods acquired under finance leases are as follows:

Year ended December 31, 2019

Item		Number of lease Original		Euros
	Lease maturity				Lease payments made		Pending payments
			payments	cost	Prior years	Current year	Current	Non current
Transport equipment	4/22/2021	60	a)	31,908	16,708	6,395	7,097	2,231
Transport equipment	3/5/2023	60	a)	49,835	7,960	41,875	-	-
Transport equipment	11/22/2022	48	a)	105,830	913	11,092	11,344	82,481
Transport equipment	2/26/2024	60	a)	32,975	-	5,802	6,402	20,771
Transport equipment	6/3/2024	60	a)	37,312	-	3,731	8,084	26,119
Total				257,860	25,581	68,895	32,927	131,602

a) Monthly lease payments

Year ended December 31, 2018

		Number of lease payments		Euros
Item	Lease			Original	Lease payments made		Pending installments
	maturity			cost	Prior years	Current year	Current	Non current
Transport equipment	4/22/2021	60	a)	31,908	10,486	6,222	6,919	8,805
Transport equipment	3/5/2023	60	a)	49,835	-	7,960	9,651	32,224
Transport equipment	11/22/2022	48	a)	105,830	-	913	11,092	93,825
Total				187,573	10,486	15,095	27,662	134,854

a) Monthly lease payments

7.2. Operating leases - Lessee

The Company leases the right to use certain goods from third parties and group companies to perform its activity. The conditions attaching to the main lease agreements which were in force during 2019 and 2018 were as follows:

Year ended December 31, 2019

Item	Lease maturity	Expense for the year (a)	Contingent payments	Renewals
		2019		Year	Purchase option	Price review
Offices Rafael Botí 2	2020	108,000	b)	2019	N/A	2020
Offices Rafael Botí 26	2022	119,922	b)	-	-	-
Apartment Mexico	2019	11,858	b)	-	-	-
Other leased premises	2020	8,677	b)	-	-	-
Total		248,457

a) Monthly lease payments

b) Based on CPI

Year ended December 31, 2018

Item	Lease	Expense for the year (a)	Contingent payments	Renewals
	maturity	2018		Year	Purchase option	Price review
Leased offices	2019	108,000	b)	2018	N/A	2019
Leased apartment	2019	21,798	b)	2018	N/A	2019
Total		129,798

a) Monthly lease payments

b) Based on CPI

At 2019 and 2018 year end the Company had set up the legal guarantees demanded by the lessors, the value of which amounted to 24,000 euros (Note 8.2).

At December 31, 2019 and 2018 the future minimum payments for non-cancelable operating lease agreements broken down by maturity are as follows:

	Minimum payments 2019	Minimum payments 2018
Within one year Between 1 and 5 years Over 5 years	310,062 189,557 23,695	129,798 - -
Total	523,314	129,798

Neither at 2019 and 2018 year end or during either year were the assets leased by the Company subleased to third parties.

8. Financial investments

8.1. Investments in group companies, jointly-controlled entities, and associates

The breakdown and movements for the captions included under this balance sheet heading for 2019 and 2018 were as follows:

Year ended December 31, 2019

	Balance at 12.31.2018	Additions	Decreases	Impairment losses	Balance at 12.31.2019
Non-current investments
Equity instruments	11,561,020	17,850,649	-	-	29,411,669
Unpaid portion of equity investments	(67,023)	(48,000)	-	-	(115,023)
Loans to companies	855,622	9,322,477	-	-	10,178,099
	12,349,619	27,125,126	-	-	39,474,745
Current investments
Loans to companies	2,449,123	1,483,977	-	-	3,933,100
	2,449,123	1,483,977	-	-	3,933,100
Total	14,798,742	28,609,103	-	-	43,407,845

Year ended December 31, 2018

	Balance at 12.31.2017	Additions	Decreases	Impairment losses	Balance at 12.31.2018
Non-current investments
Equity instruments	12,258,176	5,359,235	(6,056,391)	-	11,561,020
Unpaid portion of equity investments	(48,119)	(40,482)	21,578	-	(67,023)
Loans to companies	742,295	113,327	-	-	855,622
	12,952,352	5,432,080	(6,034,813)	-	12,349,619
Current investments
Loans to companies	4,906,162	-	(157,222)	(2,299,818)	2,449,123
	4,906,162	-	(157,222)	(2,299,818)	2,449,123
Total	17,858,514	5,432,080	(6,192,035)	(2,299,818)	14,798,741

Equity instruments

The breakdown at 2019 and 2018 year end and the movements for this balance sheet heading are as follows:

Name	Balance at 12.31.17	Additions	Derecognitions	Balance at 12.31.18	Additions	Derecognitions	Balance at 12.31.19
GRENERGY PACIFIC PAN DE AZUCAR	128,036	-	(128,036)	-	-	-	-
GRENERGY PACIFIC LTDA	43,150	-	-	43,150	-	-	43,150
GRENERGY PERU SAC	275	-	-	275	-	-	275
GREENHOUSE SOLAR FIELDS, S.L.	3,006	-	-	3,006	-	-	3,006
GREENHOUSE SOLAR ENERGY, S.L.	3,006	-	-	3,006	-	-	3,006
GREENHOUSE RENEWABLE ENERGY, S.L.	3,006	-	-	3,006	-	-	3,006
GUIA DE ISORA SOLAR 2, S.L.	1,565	-	-	1,565	-	-	1,565
GR RENOVABLES MÉXICO	2,843	-	-	2,843	-	-	2,843
GR SOLAR 2020, S.L.	3,000	-	-	3,000	-	-	3,000
GR SUN SPAIN, S.L.	3,000	-	-	3,000	-	-	3,000
GR EQUITY WIND AND SOLAR, S.L.	3,000	-	-	3,000	-	-	3,000
GR TINEO, S.P.A.	575,454	-	(575,454)	-	-	-	-
GR HUINGAN, S.P.A.	1,645,010	-	(1,645,010)	-	-	-	-
GR LINGUE, S.P.A.	853,478	-	(853,478)	-	-	-	-
GR GUAYACAN S.P.A.	556,018	-	(556,018)	-	-	-	-
GR TARUCA S.A.C.	1,597,955	-	-	1,597,955	1,264,188	-	2,862,143
GR PAINO S.A.C.	1,597,955	-	-	1,597,955	1,274,743	-	2,872,698
GRENERGY COLOMBIA S.A.S.	12,168	-	-	12,168	258,071	-	270,239
GR LAUREL, S.P.A.	554,320	-	(554,320)	-	-	-	-
GR LITRE, S.P.A.	1,728,982	-	(1,728,982)	-	-	-	-
GREENHUB S.L. DE C.V.	17,797	-	-	17,797	-	-	17,797
LEVEL FOTOVOLTAICA S.L.	1,504	-	-	1,504	-	-	1,504
GR BAÑUELA RENOVABLES, S.L.	3,000	-	-	3,000	-	-	3,000
GR TURBON RENOVABLES, S.L.	3,000	-	-	3,000	-	-	3,000
GR AITANA RENOVABLES, S.L.	3,000	-	-	3,000	-	-	3,000
GR ASPE RENOVABLES, S.L.	3,000	-	-	3,000	-	-	3,000
KOSTEN S.A.	2,861,053	5,297,753	-	8,158,806	-	-	8,158,806
GR JULIACA, S.A.C.	255	-	-	255	-	-	255
GR HUAMBOS, S.A.C.	255	-	-	255	-	-	255
GR APORIC, S.A.C.	255	-	-	255	-	-	255
GR BAYONAR, S.A.C.	255	-	-	255	-	-	255
GR VALE S.A.C.	255	-	-	255	-	-	255
GRENERGY ATLANTICS, S.A.	-	6,486	-	6,486	97,142	-	103,628
EIDEN RENOVABLES, S.L.	-	3,000	-	3,000	-	-	3,000
EL AGUILA RENOVABLES, S.A.	-	3,000	-	3,000	-	-	3,000
MAMBAR RENOVABLES, S.L.	-	3,000	-	3,000	-	-	3,000
CHAMBO RENOVABLES, S.A.	-	3,000	-	3,000	-	-	3,000
EUGABA RENOVABLES, S.L.	-	3,000	-	3,000	-	-	3,000
TAKE RENOVABLES, S.L.	-	3,000	-	3,000	-	-	3,000
NEGUA RENOVABLES, S.L.	-	3,000	-	3,000	-	-	3,000
GRENERGY OPEX, SPA	-	-	-	-	1,259	-	1,259
PEQ, SPA	-	-	-	-	14,907,246	-	14,907,246
VIATRES RENEWABLE ENERGY, S.L.	1,200	-	-	1,200	-	-	1,200
Total	12,210,056	5,325,239	(6,041,298)	11,493,997	17,802,649	-	29,296,646

The main movements during 2019 were as follows:

• · Capital increase for GR Taruca, S.A.C. amounting to 1,264,188 euros.
• · Capital increase for GR Paino, S.A.C. amounting to 1,274,743 euros.
• · Capital increase for GR Colombia, S.A.C. amounting to 258,071 euros.
• · Capital increase for GR Atlantics, S.A. amounting to 97,143 euros.
• · Incorporation of GR Opex, S.P.A. with share capital totaling 1,259 euros, fully subscribed and paid in at 2019 year end.
• · Acquisition of PEQ, S.P.A. for 7,010,433 euros. At December 31, 2019 an amount of 2,113,810 euros was pending payment to the former shareholders of the company (Note 13.4). Subsequently, in December 2019 a capital increase was carried out for the company in the amount of 7,896,813 euros via capitalization of debt.
• · Sale of shareholdings in GR Chaquihue, SPA, GR Tamarugo, SPA, GR Molle, SPA, and GR Belloto, SPA. Said transactions generated capital gains of 6,924 thousand euros, recognized under "Impairment and gains (losses) on disposals of financial instruments" in the accompanying income statement.

The main movements during 2018 were as follows:

• · Capital increase for Kosten, S.A. amounting to 5,297,753 euros.
• · Incorporation of Eiden Renovables, S.L., El Aguila Renovables, S.L., Mambar Renovables, S.L., Chambo Renovables, S.L., Eugaba Renovables, S.L., Take Renovables, S.L., and Negua Renovables, S.L., with 3,000 euros of share capital for each company. At December 31, 2018 the share capital of these companies was fully subscribed and paid in by the Company.
• · Incorporation of GR Pimiento, SPA, GR Chañar, SPA, GR Carza, SPA, GR Pilo, SPA, GR Lúcumo, SPA, GR Pitao, SPA, GR Lleuque, SPA, GR Notro, SPA, GR Lenga, SPA, GR Tepú, SPA, GR Lumilla, SPA, GR Toromiro, SPA, GR Pacama, SPA, GR Temo, SPA, GR Ruil, SPA, with 1,357 euros of share capital for each company; incorporation of GR Huacano, SPA, GR Corcolén, SPA, GR Luma, SPA, GR Fuinque, SPA, GR Piñol, SPA, GR Queñoa, SPA, GR Tayú, SPA, GR Petra, SPA, GR Corontillo, SPA, GR Liun, SPA, GR Kewiña, SPA, GR Frangel, SPA, GR Maqui, SPA, GR Petrillo, SPA, GR Tepa, SPA, and Grenergy Opex,SPA with 1,258 euros of share capital for each company, fully subscribed by the Company. At December 31, 2018 the share capital of these companies was not yet paid in.
• · Sale of shareholdings in GR Quillay, SPA, GR Huingan, SPA, GR Alerce, SPA, GR Arrayán, SPA, GR Avellano, SPA, GR Laurel, SPA, GR Litre, SPA, GR Palma, SPA, GR Lilén, SPA, GR Meli, SPA, GR Lingue, SPA, GR Guayacán, SPA, GR Tineo, SPA, and GR Pan de Azúcar, SPA. Said transactions generated capital gains amounting to 9,341 thousand euros, recognized under "Impairment and gains (losses) on disposal of financial instruments" in the accompanying income statement.

None of the entities in which the Company has invested are listed on an organized securities market.

The Company considers that holding less than 20% of interests in another company means no significant influence can be exercised over it and that holding more than 20% of interests in another company does allow for the exercise of significant influence.

The directors of the Company consider that there are no indications of any impairment losses on its investments in group companies at either 2019 or 2018 year end. Consequently, it did not recognize any related impairment losses during either year.

The information relating to each of the entities in which the Company is invested is disclosed in Appendix I.

Loans to group companies

These items correspond to the financing granted by the Company to different group companies. At 2019 and 2018 year end, the breakdown of these borrowing facilities by entity, including their main characteristics, is as follows:

Year ended December 31, 2019

					Euros
Entity	Maturity date	Interest rate	Type of guarantee	Credit limit	Non current assets	Current assets	Total
GR RENOVABLES MEXICO S.A. DE C.V. (*)	12/31/2020	Euribor + 200 b.p.	-	2,000,000	-	-	-
GRENERGY PERU SAC (*)	12/31/2020	Euribor + 200 b.p.	-	1,000,000	1,073,857	-	1,073,857
GRENERGY COLOMBIA S.A.S(*)	12/31/2020	Euribor + 200 b.p.	-	300,000	76,615	-	76,615
LEVEL FOTOVOLTAICA, S.L.	Indefinite	4% fixed	-	300,000	-	-	-
KOSTEN.S.A.	Indefinite	7% fixed	-	-	8,381,168	-	8,381,168
GRENERGY ATLANTICS, S.A.	Indefinite	Euribor + 200 b.p.	-	-	276,997	-	276,997
GR SOLAR 2020, S.L.U.	Indefinite	Euribor + 200 b.p.	-	-	234,184	-	234,184
GR SUN SPAIN SLU	Indefinite	Euribor + 200 b.p.	-	-	100,152	-	100,152
GR TARUCA	Indefinite	Euribor + 200 b.p.	-	-	-	2,522,314	2,522,314
GR PAINO	Indefinite	Euribor + 200 b.p.	-	-	-	629,531	629,531
GR AITANA RENOVABLES, S.L.	Indefinite	-	-	-	-	215,750	215,750
GR BAÑUELA RENOVABLES, S.L.	Indefinite	-	-	-	-	143,118	143,118
GR TURBON RENOVABLES, S.L.	Indefinite	-	-	-	-	143,152	143,152
GR ASPE RENOVABLES, S.L.	Indefinite	-	-	-	-	131,986	131,986
EUGABA RENOVABLES, S.L.U.	Indefinite	-	-	-	-	34,634	34,634
NEGUA RENOVABLES, S.L.U.	Indefinite	-	-	-	-	34,634	34,634
TAKE RENOVABLES, S.L.U.	Indefinite	-	-	-	-	34,634	34,634
Other group companies	Indefinite	-	-	-	35,126	43,347	78,473
Total					10,178,099	3,933,100	14,111,199

(*) These items correspond to credit facilities maturing in 2020 which can be annually renewed. At December 31 they were classified under non-current assets given that the Company expects repayment over the long term.

					Euros
Entity	Maturity date	Interest rate	Type of guarantee	Credit limit	Non current assets	Current assets	Total
GR EQUITY WIND & SOLAR S.L.	12/31/2019	Euribor + 200 b.p.	-	4,000,000	-	802,308	802,308
GR RENOVABLES MEXICO S.A. DE C.V.	12/31/2019	Euribor + 200 b.p.	-	2,000,000	-	1,957,928	1,957,928
GR RENOVABLES MEXICO S.A. DE C.V (Impairment)	-	-	-	-	-	(1,957,928)	(1,957,928)
GRENERGY PERU SAC	12/31/2019	Euribor + 200 b.p.	-	1,000,000	-	1,482,849	1,482,849
GRENERGY COLOMBIA S.S.	12/31/2019	Euribor + 200 b.p.	-	300,000	-	163,965	163,965
LEVEL FOTOVOLTAICA, S.L.	Indefinite	4% fixed	-	300,000	-	341,889	341,889
LEVEL FOTOVOLTAICA, S.L. (Impairment)	-	-	-	-	-	(341,889)	(341,889)
KOSTEN.S.A.	Indefinite	2% fixed	-	400,000	332,980	-	332,980
GRENERGY ATLANTICS, S.A.	Indefinite	-	-	-	97,143	-	97,143
GR SOLAR 2020, S.L.U.	Indefinite	-	-	-	106,868	-	106,868
GR SUN SPAIN SLU	Indefinite	-	-	-	53,095	-	53,095
Other group companies	Indefinite	-	-	-	265,536	-	265,536
Total					855,622	2,449,123	3,304,744

In 2019 and 2018 the Company recognized interest income amounting to 439,712 euros and 96,793 euros, respectively.

At December 31, 2019 the Company recognized a provision for impairment losses amounting to 275 thousand euros (2018: 2,300 thousand euros) in connection with the loans granted to the Group companeis GR Renovables México, S.A. de C.V. and Level Fotovoltaíca, S.L., given the doubts regarding recoverability of said loans. Said amount is recognized under "Impairment of and gains (losses) on disposal of financial instruments" in the accompanying income statement.

8.2. Other financial investments

The movements during 2019 and 2018 in the different balances recognized under the headings for financial investments in the accompanying balance sheet are as follows:

	Balance at 12.31.2017	Additions	Decreases	Balance at 12.31.18	Additions	Decreases	Balance at 12.31.19
Non-current investments Security deposits and guarantees	26,040 26,040	-	-	26,040 26,040	-	(2,040) (2,040)	24,000 24,000
Current investments Other financial assets	- -	- -	- -	- -	7,125,273 7,125,273	(267,506) (267,506)	6,857,767 6,857,767
Total	26,040	-	-	26,040	7,125,273	(269,546)	6,881,767

Other financial assets recognized under current assets at December 31, 2019 correspond to short-term deposits at Bankinter which bear interest at market rates.

The breakdown at December 31, 2019 and 2018 of the financial investments based on how the Company manages them is as follows:

		12.31.2019		12.31.2018
	At maturity	Loans and receivables	Total	At maturity	Loans and receivables	Total
Non-current investments	24,000	-	24,000	24,000	-	24,000
Security deposits and guarantees	24,000	-	24,000	24,000	-	24,000
Current investments	-	6,857,767	6,857,767	-	-	-
Other financial assets	-	6,857,767	6,857,767	-	-	-
Total	24,000	6,857,767	6,881,767	24,000	-	24,000

The Company did not reclassify any financial assets amongst different categories nor did it assign or transfer any financial assets during 2019 or 2018.

At December 31, 2019 and 2018, the maturities of financial assets that are fixed or determinable by residual amounts are less than five years.

At December 31, 2019 and 2018 the Company had not delivered or accepted any financial assets as guarantees for transactions.

9. Inventories

The breakdown of the Company's inventories at December 31, 2019 and 2018 is as follows:

		12.31.2019		12.31.2018
	Cost	Impairment losses	Balance	Cost	Impairment losses	Balance
Raw materials and other consumables	872,111	-	872,111	1,115,309	-	1,115,309
Work in progress	820,022	-	820,022	-	-	-
Prepayments to suppliers	-	-	-	997	-	997
Total	1,692,133	-	1,692,133	1,116,306	-	1,116,306

Since the directors of the Company consider that there are no indications of impairment losses on inventories at December 31, 2019 and 2018, no impairment loss adjustments were recorded in either year.

The Company has arranged insurance policies to cover the potential risks to which its inventories are exposed. The coverage of these insurance policies is considered sufficient.

10. Trade receivables and other receivables

The heading "Trade receivables and other receivables" in the accompanying balance sheet presents amounts receivable for the rendering of operating and maintenance services for photovoltaic installations, as well as amounts receivable for the construction and sale of photovoltaic installations. The debts pending collection for the sale of shareholdings in group companies are recorded under "Other receivables."

At 2019 and 2018 year end, the Company did not consider any of its receivable balances as doubtful.

At December 31, 2019 and 2018 the Company signed purchase-sale contracts for shares in companies owning development rights. Since said contracts included resolutory clauses, the sales are not considered irrevocable until certain conditions have been fulfilled. The corresponding amounts collected were classified as current liabilities under "Customer advances" in the accompanying balance sheet, totaling 4,580,276 and 2,263,738 euros, respectively.

11. Cash and cash equivalents

The breakdown for this heading in 2019 and 2018 is as follows:

	Balance at 12.31.2019	Balance at 12.31.2018
Cash in hand	17,409,454	8,256,323
Total	17,409,454	8,256,323

Of the amounts shown in the table above, at December 31, 2019 and 2018, 1,243,653 euros and 1,214,099 euros, respectively, correspond to current accounts pledged for obtaining guarantees.

12. Capital and reserves

12.1. Share capital

At December 31, 2019 the Company's share capital amounted to 8,507,177 euros, corresponding to 24,306,221 shares with a nominal value of 0.35 euros each.

The shareholders in general meeting at June 17, 2019 agreed upon a capital increase of 4,861,244 euros with a charge to the Company's voluntary reserves, via increase of the nominal value of already issued shares by 0.2 euros per share, resulting in a nominal value of 0.35 euros per share.

The shares of the Company were listed on the MAB-EE on July 8, 2015. As a consequence of its admission to trading on the MAB-EE, the Company lost its status as a sole shareholder company, which had been declared during 2014. On November 15, 2019 the Company's shareholders in general meeting approved, amongst other matters, to request the delisting of its shares on the MAB-EE and, simultaneously, request their listing on the Stock Exchanges of Barcelona, Bilbao, Madrid, and Valencia, and their inclusion on the Spanish electronic trading platform. As a consequence of the above, the Board of Directors of Bolsas y Mercados Españoles, Sistemas de Negociación, S.A. agreed to delist the 24,306,221 shares of the Company on said market, effective from December 16, 2019, the same date on which the Company's shares were admitted to trading on the Stock Exchanges of Madrid, Barcelona, Bilbao, and Valencia. As a prior step to the process of delisting all the Company's shares on the MAB-EE and simultaneous admission to trading on the Stock Exchanges of Madrid, Barcelona, Bilbao, and Valencia ; Daruan Group Holding, S.L.U. certain minority shareholders, realized a private placement of 2,429,000 Company shares, representing 10% of its share capital, was carried out for certain minority shareholders, through an accelerated bookbuilding process. The expenses incurred for admission to trading the Company's shares on the Stock Exchanges of Barcelona, Bilbao, Madrid, and Valencia, and their inclusion on the Spanish electronic trading platform, amounted to 551 thousand euros.

At December 31, 2019 the following shareholders held a direct stake of more than 10% of share capital:

Shareholder	No. of shares	Percentage of ownership interest
Daruan Group Holding, S.L.	16,539,590	68%

12.2. Share premium

The share premium amounted to 6,117,703 euros at December 31, 2019. This balance can be used for the same purposes as the voluntary reserves of the Company, including conversion to capital.

12.3. Reserves

The statement of changes in equity which forms a part of these financial statements provides the breakdown for aggregate balances and movements during 2019 and 2018 in this subheading of the accompanying balance sheet. The breakdown and composition of the different line items are shown below:

	Balance at 12.31.2017	Increase	Transfers	Balance at 12.31.18	Increase	Decreases	Balance at 12.31.19
Legal and statutory reserves Legal reserve	729,187	-	-	729,187	-	-	729,187
Other reserves Voluntary reserves Capitalization reserves	8,953,339 315,027	2,728,607 -	(20,194) 20,194	11,661,752 335,221	10,897,645 204,237	(7,124,981) -	15,434,416 539,458
Total	9,997,553	2,728,607	-	12,726,160	11,101,882	(7,124,981)	16,703,061

Legal reserve

In accordance with article 274 of the Spanish Corporate Enterprises Act, 10% of profit must be transferred to the legal reserve each year until it represents at least 20% of share capital.

This reserve is not distributable to owners and may only be used to offset income statement losses provided no other reserves are available. The balance recognized for this reserve can be used to increase share capital.

Voluntary reserves

These reserves are freely distributable.

The gains or losses obtained on the purchase-sale of treasury shares are recognized directly under voluntary reserves. The increase in voluntary reserves in connection with this item recognized in 2019 totals 2,110,720 euros (2018: 812,165 euros).

Capitalization reserves

During 2017 the Company set aside a capitalization reserve, with a charge to available reserves, corresponding to 10% of the increase in capital and reserves of 2016, in accordance with the stipulations of article 25 of Law 27/2014 of November 27, on Corporate Income Tax (Note 16). This reserve will be restricted for a period of 5 years. During 2019 this reserve increased by 204,237 euros, corresponding to 10% of the increase in capital and reserves of 2018.

Treasury shares

On May 19, 2015, the shareholders in general meeting, in accordance with the provisions of article 146 of the Spanish Corporate Enterprises Act, unanimously agreed to authorize the Board of Directors of the Company to acquire, once or on several occasions, a maximum of 2,000,000 Company shares, at a maximum price of 5 euros and a minimum price of 0.01 euros per share. Such acquisitions may be carried out by way of purchase, exchange, donation, foreclosure, or payment in kind, and in general, by any other form of acquisition for valuable consideration.

Thus, in the share purchase deed, dated June 29, 2015, the majority shareholder, Daruan Group Holding, S.L., agreed to transfer 520,000 shares to Grenergy Renovables, S.A. to create a treasury share portfolio. The purchase-sale price was determined to be the price fixed in the Grenergy Renovables, S.A. share subscription offer.

In the month of December 2019, the Company subscribed a new liquidity contract with Banco Sabadell for management of its treasury share portfolio. The duration of the contract, which became effective on December 16, 2019, is of twelve months.

The shares acquired in the treasury share portfolio are held to meet the obligations arising from the contract signed with the liquidity provider, in accordance with the provisions of Circular 1/2017 of the Spanish Securities Exchange Commission ("CNMV" in its Spanish acronym).

In connection with the new liquidity contract, the Company allocated 26,525 shares to the associated securities account and 500,000 euros to the cash balance account.

Banco Sabadell will carry out the transactions established in the present contract in regulated markets and Spanish multilateral trading systems, via market orders, in accordance with the contracting rules established in the CNMV Circular.

On September 11, 2018 the Company acquired 365,426 treasury shares from related persons at a price of 2.40 euros per share.

At December 31, 2019 and 2018 the treasury share portfolio is broken down as follows:

	Balance at 12.31.2019	Balance at 12.31.2018
No. of shares in treasury share portfolio	556,815	888,177
Total treasury share portfolio	3,328,497	2,062,970
Liquidity Accounts	2,423,479	1,198,776
Fixed Own Portfolio Account	905,018	864,194

During 2019 and 2018, the movements in the treasury share portfolio were as follows:

Year ended December 31, 2019

	Treasury shares
	Number of shares	Value of portfolio	Average acquisition price
Balance at 12.31.2018	888,177	2,062,969	2.32
Acquisitions	389,978	3,882,063	9.95
Disposals	(721,340)	(2,616,535)	3.63
Balance at 12.31.2019	556,815	3,328,497	5.98

Year ended December 31, 2018

	Treasury shares
	Number of shares	Value of portfolio	Average acquisition price
Balance at 12.31.2017	741,577	1,133,498	1.55
Acquisitions	658,055	1,869,232	2.84
Disposals	(511,455)	(939,761)	1.84
Balance at 12.31.2018	888,177	2,062,969	2.32

The purpose of holding the treasury shares is to maintain them available for sale in the market and for the incentive plan approved for directors, executives, employees, and key collaborators of the Group (Note 12.5).

At December 31, 2019 treasury shares represent 2.3% of all the Company's shares (2018: 3.7%).

12.4. Incentive plans for employees

At the meeting held on June 26, 2015, the Board of Directors of the Company approved an incentive plan for certain executives and key personnel based on the granting of options on the Company's shares. At December 31, 2019 the number of shares set aside to cover this plan was 22,000. The exercise price for the share options was fixed at 1.38 euros per share.

The beneficiary will be able to acquire:

• A third of the shares granted for the option from the date on which two years have elapsed counting from the grant date.
• A third of the shares granted for the option from the date on which three years have elapsed counting from the grant date.
• A third of the shares granted for the option from the date on which four years have elapsed counting from the grant date.

At June 2, 2016 a second incentive plan was approved based on the granting of options on the Company's shares with similar characteristics to the first one. At December 31, 2019 the number of shares set aside for covering this plan totaled 48,667 shares. The exercise price of the share options was established as 1.90 euros per share.

At November 27, 2018 a third incentive plan was approved based on the granting of options on the Company's shares with similar characteristics to the previous two plans. At December 31, 2019 the number of shares set aside for covering this plan totaled 157,143 shares. The exercise price of the share options was established as 3.50 euros per share.

At March 29, 2019 a fourth incentive plan was approved based on the granting of options on the Company's shares with similar characteristics to the previous three plans. At December 31, 2019 the number of shares set aside for covering this plan totaled 62,200 shares. The exercise price of the share options was established as 6.90 euros per share.

Said incentive plans establish that their settlement will be carried out by delivery of equity instruments to the employees should they exercise the options granted. The exercise prices of the options on shares were established by reference to the fair value of the corresponding equity instruments at the grant date. The Company did not recognize any amounts relating to this item since it considered that the fair value of the option price is not significant.

At December 31, 2019 there were 54,445 exercisable options (2018: 198,000). In 2019, 263,333 options were exercised (2018: 0 options).

13. Non-current and current borrowings

The breakdown of these headings in the accompanying balance sheet at December 31, 2019 and 2018 is as follows:

Year ended December 31, 2019

	Non-current borrowings	Current borrowings	Total at 12.31.19
Bonds and other marketable securities	21,539,687	-	21,539,687
Bank borrowings	831,260	3,493,301	4,324,561
Loans	831,260	2,175,207	3,006,467
Credit lines	-	23,102	23,102
Foreign financing	-	1,294,992	1,294,992
Other borrowings	208,249	3,342,401	3,550,650
Finance lease liabilities	131,602	32,927	164,529
Total	22,710,798	6,868,629	29,579,427

Year ended December 31, 2018

	Non-current	Current	Total at
	borrowings	borrowings	12.31.18
Bank borrowings	2,982,665	6,058,449	9,041,114
Loans	2,982,665	2,799,001	5,781,666
Credit lines	-	2,420,690	2,420,690
Foreign financing	-	838,758	838,758
Other borrowings	266,536	1,244,074	1,510,610
Finance lease liabilities	134,854	27,662	162,516
Total	3,384,055	7,330,185	10,714,240

All the financial liabilities held by the Company are classified under "Trade and other payables" for measurement purposes.

At December 31, 2019 and 2018 the breakdown of borrowings by residual maturities is as follows:

	Bonds and other marketable securities	Bank borrowings	Other borrowings	Finance lease liabilities	Total
Within one year	-	3,493,301	3,342,401	32,927	6,868,629
2021	-	831,260	52,060	27,773	911,093
2022	-	-	156,189	84,894	241,083
2023	-	-	-	14,092	14,092
2024	21,539,687	-	-	4,843	21,544,530
More than five
years	-	-	-	-	-
Total	21,539,687	4,324,561	3,550,650	164,529	29,579,427

Year ended December 31, 2018

	Bank borrowings	Other borrowings	Finance lease liabilities	Total
Within one year	6,058,449	1,244,074	27,662	7,330,185
2020	2,165,016	52,060	27,688	2,244,765
2021	817,649	52,060	23,168	892,877
2022	-	52,060	80,887	132,947
2023	-	52,060	3,111	55,171
More than five years	-	58,296	-	58,295
Total	9,041,114	1,510,610	162,516	10,714,240

During 2019 and 2018 the Company complied with the payment of all its financial debt at maturity. Likewise, at the date of authorization of these financial statements the Company had complied with all obligations assumed.

13.1. Bonds and other marketable securities

In October 2019, the Board of Directors of Grenergy agreed upon establishment of the "Grenergy Renewables Fixed Income Program 2019," by virtue of which the Company can issue medium and long-term fixed-income securities for a maximum nominal amount of up to 50,000,000 euros. Thus, in October 2019, the corresponding admission prospectus was prepared for the Alternative Fixed Income Market ("MARF") with a view to trading the bonds issued under the "Grenergy Renewables Fixed Income Program 2019" on said market within the period it is in force (one year from preparation of the MARF admission prospectus).

In November 2019, the Company carried out a bond issue under said program for a nominal amount of 22,000,000 euros, bearing 4.75% interest and maturing in November 2024. Interest accrued during 2019 amounted to 174 thousand euros.

This bond issue is subject to fulfillment of a series of covenants, which had all been fulfilled at December 31, 2019.

13.2. Bank borrowings

The breakdown of loans subscribed and their main contractual conditions at December 31, 2019 and 2018 is as follows:

Year ended December 31, 2019

					Euros
Financial institution	Maturity date	Interest rate	Type of guarantee	Installments	Non-current liabilities	Current liabilities	Total
BANCO SABADELL	10/20/2021	2.50%	No	Monthly	534,031	609,693	1,143,724
BANCO SABADELL (loan denominated in USD)	4/19/2021	3.60%	No	Monthly	297,229	891,687	1,188,916
BANCO SANTANDER	4/10/2020	2.15%	No	Monthly	-	673,827	673,827
Total					831,260	2,175,207	3,006,467

Year ended December 31, 2018

					Euros
Financial institution	Maturity date	Interest rate	Type of guarantee	Installments	Non-current liabilities	Current liabilities	Total
BANCO SABADELL	10/20/2021	2.50%	No	Monthly	1,143,724	602,127	1,745,851
BANCO SABADELL (USD)	4/19/2021	3.60%	No	Monthly	1,165,114	870,701	2,035,815
BANCO SANTANDER	4/10/2020	2.15%	No	Monthly	673,827	1,326,173	2,000,000
Total					2,982,665	2,799,001	5,781,666

All the subscribed loans bear interest at market rates. The average annual interest rate for 2019 and 2018 was 2.75%.

13.3. Credit policies and foreign financing

At December 31, 2019 and 2018 the Company had subscribed credit facilities and credit financing for foreign operations with various financial entities. The breakdown of the credit drawdowns at said dates together with the corresponding contractual terms is as follows:

Year ended December 31, 2019

		Euros
Financial institution	Maturity date	Credit limit granted	Drawdown	Drawable amount
BANKIA I	5/27/2020	100,000	-	100,000
BANKIA II	4/21/2020	1,500,000	-	1,500,000
SANTANDER	4/17/2020	300,000		300,000
SANTANDER II (PREVIOUSLY "POPULAR")	5/7/2020	200,000	-	200,000
SABADELL	5/10/2020	200,000	23,102	176,898
BANKINTER	Indefinite	500,000		500,000
BANKIA (VISA)	Indefinite	3,000		3,000
BANCO SABADELL (VISA)	Indefinite	30,000	-	30,000
Total credit facilities		2,833,000	23,102	2,809,898
SABADELL (USD)	Indefinite	13,500,000	67,554	2,886,110
SANTANDER (USD)	Indefinite	11,750,000	-	7,024,020
BANKIA (USD)	5/27/2020	11,000,000	1,227,438	3,218,843
BANKINTER (USD)	Indefinite	11,000,000	-	5,531,739
CAIXABANK (USD)	1/23/2021	5,000,000	-	2,985,581
BBVA (USD)	3/1/2020	5,000,000	-	-
Total foreign financing		57,250,000	1,294,992	21,646,293
Total		60,083,000	1,318,094	24,456,191

		Euros
Financial institution	Maturity date	Credit limit	Drawdown	Drawable amount
BANKIA I	9/7/2019	100,000	93,524	6,476
BANKIA II	4/21/2019	1,500,000	1,494,422	5,578
SANTANDER	4/17/2019	300,000	281,761	18,239
POPULAR	4/17/2019	200,000	189,852	10,148
SABADELL	7/7/2019	200,000	80,203	119,797
BANKINTER	7/28/2019	300,000	271,616	28,384
BANKIA (VISA)	Indefinite	3,000	-	3,000
BANCO SABADELL (VISA)	Indefinite	30,000	9,312	20,688
Total credit facilities		2,633,000	2,420,690	212,310
SABADELL (USD)	Indefinite	6,500,000	250,952	6,249,048
SANTANDER (USD)	Indefinite	6,000,000	-	6,000,000
BANKIA (USD)	9/7/2019	6,000,000	587,806	5,412,194
POPULAR (USD)	10/26/2019	2,000,000	-	2,000,000
BANKINTER (USD)	7/28/2019	6,500,000	-	6,500,000
CAIXABANK (USD)	1/23/2019	5,000,000	-	5,000,000
BBVA (USD)	7/12/2019	3,000,000	-	3,000,000
Total foreign financing		35,000,000	838,758	34,161,242
Total		37,633,000	3,259,448	34,373,552

The foreign financing contracted by the Company for the years 2019 and 2018 includes credit transactions as well as warranty coverage, letters of credit, and guarantees (Note 21.2).

The average annual interest rate on the credit facilities during 2019 and 2018 was 2.15%.

13.4. Other borrowings

The breakdown of this heading at December 31, 2019 and 2018 was the following:

Year ended December 31, 2019

					Euros
Creditor	Maturity date	Interest rate	Type of guarantee	Installments	Non-current liabilities	Current liabilities	Total
Spanish Centre for the Development of Industrial Technology (CDTI)	5/12/2022	Zero interest	No	Monthly	208,249	52,060	260,309
Ministry of Economy and Competition	1/20/2021	Zero interest	No	Monthly	-	6,226	6,226
Other borrowings (Kosten)	-	-	-	-	-	1,169,001	1,169,001
Other borrowings (PEQ)	-	-	-	-	-	2,113,810	2,113,810
Other	-	-	-	-	-	1,304	1,304
Total					208,249	3,342,401	3,550,650

					Euros
Creditor	Maturity date	Interest rate	Type of guarantee	Installments	Non current liabilities	Current liabilities	Total
Spanish Centre for the Development of Industrial Technology (CDTI)	5/12/2022	Zero interest	No	Monthly	260,308	52,060	312,368
Ministry of Economy and Competition	1/20/2021	Zero interest	No	Monthly	6,227	5,926	12,153
Other borrowings (Kosten)	-	-	-	-	-	1,186,088	1,186,088
Total					266,535	1,244,074	1,510,609

This balance corresponds to the following:

• · The amount pending payment at December 31, 2019 generated by the purchase of Kosten, S.A., integrated in the Group in 2017 (Note 8.1).
• · The amount pending payment at December 31, 2019 generated by the purchase of PEQ, S.P.A., integrated in the Group in 2019 (Note 8.1).
• · The amount pending payment at 2019 and 2018 year end corresponding to a zero interest rate loan granted by CDTI on October 13, 2011 in the amount of 520,609 euros in order to help financing the necessary investments for the project known as "Design and Modeling of a forecasting system for performance and integral control at energy distribution installations." The Company did not recognize said loan at its fair value, as established in Consultation number 1 of BOICAC 81, as it considers that said fair value does not significantly differ from its nominal amount.
• · Further, the Company received a zero interest rate loan granted by the Ministry of Economy and Competition on April 16, 2012 in the amount of 33,756 euros, relating to the personnel expenses for carrying out the project known as "Design and Modeling of a forecasting system for performance and integral control at energy distribution installations."

The repayment of these loans can be extended over a maximum period of seven yearly installments at identical amounts, allowing a maximum maturity for the first annual installment of five years counted from the date on which they were granted. The first of said annual installments was paid in 2015.

14. Borrowings from group companies and associates

The breakdown of these headings in the accompanying balance sheet at December 31, 2019 and 2018 is the following:

Year ended December 31, 2019

	Maturity	Interest	Type of	Non current	Current	Total at
	date	rate	guarantee	borrowings	borrowings	12.31.19
Borrowings from group companies Loan debt	Indefinite	12-month Euribor + 2%	-	-	242,988	242,988
Total			-	-	242,988	242,988

Year ended December 31, 2018

	Maturity	Interest	Type of	Non current	Current	Total at
	date	rate	guarantee	borrowings	borrowings	12.31.18
Borrowings from group companies
Loan debt	Indefinite	12-month Euribor + 2%	-	-	16,144	16,144
Loan debt	24 months +12	12-month Libor + 200 b.p.	-	-	2,440,840	2,440,840
Tax related debt	-	-	-	-	316,735	316,735
Total			-	-	2,773,719	2,773,719

During 2018 the Company filed its corporate tax return as part of the tax group comprised of all companies which fulfill the requirements established in Chapter VI, Title VII of Law 27/2014 of November 27, on Corporate Income Tax, with Daruan Group Holding, S.L. as the parent of said tax group. Thus, a tax related debt of 317 thousand euros owed to this company was recorded at December 31, 2018. As stated in Note 12, in 2019 the Company was no longer a member of the tax group Daruan Group Holding, S.L. and subsidiaries.

Loan debt at December 31, 2019 reflects the current account payable by Grenergy Renovables, S.A. to the group company GR Equity Wind and Solar, S.L.

As a consequence of the spin-off of Daruan Venture Capital SCR under the simplified regime, S.A., the beneficiary of which was Daruan Group Holding, S.L. Sole Shareholder Company, the latter, sole partner of Grenery Renovables, S.A., was subrogated in the multilateral credit contract amongst group companies belonging to the parent Daruan Venture Capital SCR under the simplified regime, subscribed on January 1, 2012 and ratified by public deed before Madrid Notary Mr. Jaime Recarte Casanova of February 14, 2014, with protocol number 382. This contract comprises a bidirectional credit between Daruan Group Holding, S.L. and Grenergy Renovables, S.A., by virtue of which interest is accrued at the beginning of each calendar year on the amounts they owe or lend each other, corresponding to 12-month Euribor plus a spread of 2%. The contract is of indefinite duration and can be canceled at any moment by either of the parties with one month's notice and outstanding balances to be settled at the cancellation date. At 2019 and 2018 year end, the related debt amounted to 0 thousand and 16 thousand euros, respectively.

Loan debt with other Group companies at December 31, 2018 reflects the current account payable by Grenergy Renovables, S.A. to the Group companies GR Pain SAC and GR Taruca SAC.

15. Information on deferred payments to suppliers

The average payment period for suppliers was as follows:

	2019	2018
	Days	Days
Average supplier payment period	52.92	62.56
Ratio of transactions paid	60	69
Ratio of transactions pending payment	43	45
	Amount (euros)	Amount (euros)
Total payments made	26,556,384	23,053,948
Total pending payments	18,961,836	8,445,984

16. Taxes payable and receivable and tax matters

The breakdown of balances with public administrations at December 31, 2019 and December 31, 2018 is as follows:

Receivable from public administrations	Non-current	Current	Balance at 12.31.19
Deferred tax assets	842,998	-	842,998
Other receivables from public administrations	-	636,840	636,840
VAT receivable	-	636,840	636,840
Total	842,998	636,840	1,479,838

Year ended December 31, 2019

Payable to public administrations	Non-current	Current	Balance at 12.31.19
Current tax liabilities	-	525,521	525,521
Other payables to public administrations	-	200,859	200,859
VAT payable	-	-	-
Payable to the public treasury for withholdings	-	141,608	141,608
Social security agencies	-	59,251	59,251
Total	-	726,380	726,380

Year ended Monday, December 31, 2018

Receivable from public administrations	Non-current	Current	Balance at 12.31.18
Deferred tax assets	664,819	-	664,819
Other receivables from public administrations	-	235,357	235,357
VAT recoverable	-	235,357	235,357
Total	664,819	235,357	900,176

Payable to public administrations	Non-current	Current	Balance at 12.31.18
Deferred tax liabilities	-	-	-
Other payables to public administrations	-	74,051	74,051
Payable to the public treasury for withholdings	-	34,225	34,225
Social security agencies	-	39,826	39,826
Total	-	74,051	74,051

Tax matters

At December 31, 2019 the Company is open to inspection of all taxes to which it is liable for the last four years, as well as those corresponding to 2015.

Under current Spanish tax legislation, taxes cannot be considered definitive until the tax returns have been inspected by the tax authorities or until the four-year legal inspection period has elapsed.

Due to the varying interpretations of the tax regulations applicable, certain tax contingencies that are not objectively quantifiable could arise. Nevertheless, the directors consider that tax debts arising from possible future actions taken by the tax authorities would not have a significant effect on the financial statements taken as a whole.

Income tax

The Company has been filing its tax returns under a consolidated tax regime since 2012 together with other Group companies. The parent of the tax group was Daruan Venture Capital, S.C.R. during 2012 and 2013, and since 2014 the new parent of the tax group has been Daruan Group Holding, S.L. As indicated in Note 12, in 2019 the Company left the tax group.

Due to the differing treatment of certain transactions permitted under prevailing tax legislation, the accounting profit differs from taxable income. The reconciliation of accounting profit with taxable income for 2019 and 2018 was the following:

Year ended December 31, 2019

		Income statement	Income and expense recognized directly in equity	Total
	Increase	Decrease	Total	Total
Income and expenses for the year	7,182,026	-	7,182,026	-	7,182,026
Corporate income tax	1,846,941	-	1,846,941	-	1,846,941
Permanent differences	592	(6,923,629)	(6,923,037)	-	(6,923,037)
Arising at company level	592	(6,923,629)	(6,923,037)	-	(6,923,037)
Temporary differences	278,848	(360)	278,488	-	278,488
Arising in the year	275,417	-	275,417	-	275,417
Arising in prior years	3,431	(360)	3,071	-	3,071
Capitalization reserves	-	(238,442)	(238,442)	-	(238,442)
Taxable income (Tax results)	9,308,407	(7,162,431)	2,145,976	-	2,145,976
Tax charge (25%)					536,494
Tax deductions applied					(18)
Tax payable					536,476
Withholdings and payments on account					(10,955)
Net amount payable (collectible)					525,521

	Income statement		Income and expense recognized directly in equity			Total
	Increase	Decrease	Total	Increase	Decrease	Total
Income and expenses for the year	8,991,163	-	8,991,163	-	-	-	8,991,163
Corporate income tax	1,642,517		1,642,517	-	-	-	1,642,517
Permanent differences	4,714	(11,605,134)	(11,600,420)	-	-	-	(11,600,420)
Arising at company level	4,714	(11,605,134)	(11,600,420)	-	-	-	(11,600,420)
Temporary differences	2,303,369	(408)	2,302,961	-	-	-	2,302,961
Arising in the year	2,300,846	-	2,300,846	-	-	-	2,300,846
Arising in prior years	2,523	(408)	2,115	-	-	-	2,115
Capitalization reserves	-	(62,261)	(62,261)	-	-	-	(62,261)
Taxable income (Tax results)	12,941,763	(11,667,803)	1,273,960	-	-	-	1,273,960
Tax charge (25%) Tax deductions applied Tax payable Withholdings and payments on account							318,490 (20) 318,470 (1,735)
Net amount payable (collectible)							316,735

Given that the Company files its tax returns under a consolidated regime together with other entities, the parent of the tax group was responsible for presentation and settlement of the consolidated corporate income tax. Thus, the amount payable for 2018 shown in the table above was classified for presentation purposes in the financial statements under "Current liabilities - Payables to Group companies and associates" in the accompanying balance sheet. The amount payable for 2019 is presented under "Current tax liabilities" in the accompanying balance sheet.

The reconciliation of tax payable and tax expense is as follows:

	12.31.19	12.31.18
Tax payable	(536,476)	(318,470)
Change in deferred taxes	69,622	575,740
Current foreign tax	(1,488,221)	(1,914,893)
Capitalization reserves	108,134	15,106
Income tax expense	(1,846,941)	(1,642,517)

The line item identified as "Current foreign tax" corresponds to withholding taxes on the gains arising from the sale of shareholdings in Group companies carried out by the Company in 2019 and 2018 (Note 8.1).

Deferred tax assets and liabilities

The difference between the tax expense for 2019 and prior years as compared to the tax already paid or payable for those years is recorded in "Deferred tax assets" or "Deferred tax liabilities," as applicable. Said deferred taxes were calculated by applying the prevailing nominal tax rate to the corresponding amounts.

The breakdown and movements under these balance sheet headings for 2019 and 2018 are as follows:

Year ended December 31, 2019

	Balance at 12.31.18	Recognized in the income statement	Balance at 12.31.19
		Additions	Decreases
Deferred tax assets	664,818	178,321	(141)	842,998
Tax deductions pending application	33	-	(33)	-
Temporary differences	664,785	178,321	(108)	842,998
Total	664,818	178,321	(141)	842,998
Deferred tax liabilities	-	-	-	-
Temporary differences	-	-	-	-
Total	-	-	-	-

	Balance at 12.31.2017	Recognized in the income statement	Balance at 12.31.18
		Additions	Decreases
Deferred tax assets	75,849	588,969	-	664,818
Tax deductions pending application	-	33	-	33
Temporary differences	75,849	588,936	-	664,785
Total	75,849	588,969	-	664,818
Deferred tax liabilities	1,345	-	(1,345)	-
Temporary differences	1,345	-	(1,345)	-
Total	1,345	-	(1,345)	-

The recoverability of deferred tax assets is assessed as soon as they are recognized and at least at each closing date, in accordance with the results the Company expects to generate in coming years.

Tax loss carryforwards pending offset

At 2019 and 2018 year end, the Company had no tax loss carryforwards pending application.

Deductions

At 2019 and 2018 year end there were no deductions pending application either.

17. Income and expenses

Cost of sales

The breakdown of this income statement heading for 2019 and 2018 is as follows:

Year ended December 31, 2019

	Purchases	Changes in inventories	Impairment / (Reversal)	Total
Consumption of goods for resale	48,366,737	(243,198)	-	48,123,539
Total	48,366,737	(243,198)	-	48,123,539

	Purchases	Changes in inventories	Impairment / (Reversal)	Total
Consumption of goods for resale	19,154,719	(237,426)	-	18,917,293
Total	19,154,719	(237,426)	-	18,917,293

The breakdown of purchases carried out in 2019 and 2018, by origin, is as follows:

	Balance at 12.31.19	Balance at 12.31.18
Spain	8,557,104	6,515,023
Imports	39,809,633	12,639,696
Total	48,366,737	19,154,719

Social security costs

The breakdown of this income statement heading for 2019 and 2018 is as follows:

	2019	2018
Social security payable by the Company Other social security expenses	587,928 57,971	311,648 36,956
Total	645,899	348,604

The average number of employees, by professional category, in 2019 and 2018, was as follows:

Category	2019	2018
Directors and Senior Management Department directors Other	7 8 28	5 7 17
Total	43	29

The breakdown by gender of employees, directors, and senior management at 2019 and 2018 year end, is as follows:

Category	Men	Women	TOTAL
Directors and Senior Management	6	3	9
Department directors	7	2	9
Other	27	10	37
Total	40	15	55

Year ended December 31, 2018

Category	Men	Women	TOTAL
Senior Management	5	1	6
Department directors	4	2	6
Other	20	6	26
Total	29	9	38

At December 31, 2019 and 2018 the Company had no employees under contract with disabilities greater than or equal to 33%.

Finance income and expenses

The breakdown of finance income and expenses recognized in the accompanying income statement is as follows:

Year ended December 31, 2019

	From third parties	From Group companies	Total
Income	59,996	439,712	499,708
Interest from other financial assets	59,996	439,712	499,708
Expenses	(1,038,917)	-	(1,038,917)
Interest on borrowings	(544,175)	-	(544,175)
Other finance costs	(494,742)	-	(494,742)
Exchange gains (losses)	(73,776)	-	(73,776)
Impairment losses and gains (losses) on disposals	(25,000)	6,648,212	6,623,212
Impairment losses and losses	(25,000)	(275,417)	(300,417)
Gains (losses) on disposals and other gains and losses	-	6,923,629	6,923,629
Finance cost	(1,077,697)	7,087,924	6,010,227

	From third parties	From Group companies	Total
Income	9,927	96,793	106,720
Interest from other financial assets	9,927	96,793	106,720
Expenses	(498,764)	(50,332)	(549,096)
Interest on borrowings	(311,334)	(50,332)	(361,666)
Other finance costs	(187,430)	-	(187,430)
Exchange gains (losses)	(246,588)	-	(246,588)
Impairment losses and gains (losses) on disposals	11,605,134	(2,300,846)	9,304,288
Impairment losses and losses	-	(2,300,846)	(2,300,846)
Gains (losses) on disposals and other gains and losses	11,605,134	-	11,605,134
Finance cost	10,869,709	(2,254,385)	8,615,324

18. Foreign currency

The breakdown of transactions carried out in foreign currency during 2019 and 2018 is as follows:

Year ended December 31, 2019

	Corresponding amounts in euros
	US Dollars	Total
Purchases	39,809,633	39,809,633
Sales	54,624,015	54,624,015
Total	94,433,648	94,433,648

Year ended December 31, 2018

	Corresponding amounts in euros
	US Dollars	Total
Purchases	12,407,766	12,407,766
Sales	23,304,156	23,304,156
Total	35,711,922	35,711,922

The breakdown of assets and liabilities denominated in foreign currencies at December 31, 2019 and 2018 is as follows:

Year ended December 31, 2019

	Corresponding amounts in euros
	US Dollars	Other	Total
Assets
Accounts receivable from group companies	12,966,476	-	12,966,476
Trade and other receivables	4,529,858	-	4,529,858
Cash and cash equivalents	5,915,843	-	5,915,843
Liabilities
Suppliers	12,530,393	-	12,530,393
Current borrowings	5,766,719	-	5,766,719
Total	5,115,065	-	5,115,065

Year ended December 31, 2018

	Corresponding amounts in euros
	US Dollars	Other	Total
Assets
Accounts receivable from group companies	332,980	-	332,980
Trade and other receivables	10,211,460	-	10,211,460
Cash and cash equivalents	7,673,346	-	7,673,346
Liabilities
Suppliers	5,580,656	-	5,580,656
Current borrowings	4,060,661	-	4,060,661
Total	8,576,469	-	8,576,469

19. Environmental disclosures

One of the characteristic phases in the development of a renewable energy project, whether solar or wind, is the performance of environmental impact studies and issuing of environmental impact statements for particular installations. The main objective in said studies and statements is to measure and reduce the real impact on the environment arising from execution of any project.

The main entities responsible for preventing deterioration of the environment are the competent authorities of the different countries in which Grenergy operates. Thus, assessment of the environmental impact of any activity allows the Company to introduce an environmental dimension to the design and execution of the projects and activities which it performs in each country. This assessment allows for certification that the initiatives, both in the private and public sectors, are in compliance with the applicable environmental requirements.

Though there are various types of environmental impact, they can mainly be classified into three different types in accordance with their origin: (i) environmental impact provoked by the use of natural resources; (ii) environmental impact provoked by contamination; and (iii) environmental impact provoked by the occupation of land.

The projects performed by Grenergy are in general affected mainly by the environmental impact provoked by occupation of land. Thus, at the outset of any project, land is searched for and located whose essential characteristics will not be modified by execution of the project in question or which may even be improved from an environmental point of view.

Another type of environmental impact which may have an effect on the Company's PP&E is the contamination from the machinery sometimes used by Grenergy in performing its activity. Consequently, the persons in charge of executing any phase of developing a project will always try to optimize the organization of teams, adapting it to the terrain.

Based on each project, Grenergy contracts different consultants and engineers specialized in performing environmental impact studies, which are subsequently reviewed by the competent authorities. Once said study has been analyzed in detail by the competent authority, a decision is taken as to the appropriateness of performing the activity being assessed, determining the conditions and measures necessary for adequately protecting the environment and the natural resources associated with the project.

In accordance with prevailing legislation, the Company maintains control over the extent of contamination it produces and implements an appropriate waste disposal policy.

20. Related-party transactions

20.1. Related-party transactions and balances

In addition to group entities, jointly controlled entities, and associates, the Company's related parties also include its directors and senior management (including close family members) as well as those entities over which they may exercise control or significant influence.

At 2019 and 2018 year end, the debit and credit balances held with related parties are broken down as follows:

Year ended December 31, 2019

	Parent company	Other group companies	Total
Assets
Clients	-	16,178,806	16,178,806
Accounts receivable from group companies	-	14,111,199	14,111,199
	-	30,290,005	30,290,005
Liabilities
Suppliers	-	5,436	5,436
Borrowings from group companies	-	242,988	242,988
	-	248,424	248,424

Year ended December 31, 2018

	Parent company	Other group companies	Total
Assets
Clients	-	16,062,110	16,062,110
Accounts receivable from group companies	-	3,304,745	3,304,745
	-	19,366,855	19,366,855
Liabilities
Suppliers	-	27,759	27,759
Borrowings from group companies (Note 14)	316,735	2,456,984	2,773,719
	316,735	2,484,743	2,801,478

The balances with related parties at December 31, 2019 and 2018 are comprised of the following:

• Trade receivables from group companies: reflects the debt owed Grenergy Renovables, S.A. and pending collection from its investees and related parties at year end, corresponding to the sale of consumables and the construction of solar farms, mainly related to Grenergy Renovables Pacific, totaling 13,300,143 euros at December 31, 2019 (2018: 14,431,962 euros) and Parque Eólico Quillagua, totaling 2,878,664 euros at December 31, 2019 (2018: 0 euros).
• Receivables from group companies: balances in favor of Grenergy Renovables, S.A. for credit granted to investees (Note 8.1).
• "Borrowings from group companies Parent company" reflects the balance at year end of the credit facility subscribed with Daruan Group Holding, S.L. as well as the debt generated by the corporate income tax under a consolidated regime up to December 31, 2018.
• Borrowings from other group companies mainly reflects the current account receivable for Grenergy Renovables, S.A. from GR Equity Wind and Solar, S.L. at December 31, 2019 and GR Pain SAC and GR Taruca SAC at December 31, 2018.

The breakdown of transactions performed with related parties in 2019 and 2018 is as follows:

Year ended December 31, 2019

	Parent company	Other group companies	Key management personnel	Total
Income	-	56,070,833	-	56,070,833
Sales	-	54,625,015	-	54,625,015
Other current operating income	-	1,006,106	-	1,006,106
Accrued interest	-	439,712	-	439,712
Expenses	119,922	1,568,294	1,374,521	3,062,737
Cost of sales		1,336,534	-	1,336,534
Services received	119,922	231,760	-	351,682
Remuneration	-	-	1,374,521	1,374,521

The transactions with related parties carried out during 2019 relate to the normal course of the Company's business and were generally carried out on an arm's length basis. The most significant transactions were the following:

• · The sale of necessary components for solar installations (panels, investors, etc.) to Grenergy Pacific Ltda. in the amount of 35,802,992 euros, to GR Taruca, SAC and GR Paino, SAC in the amount of 1,281,179 euros for each, and to PEQ, SPA in the amount of 16,259,665 euros.
• · Other current operating income includes management fees invoiced to the group's subsidiaries. This income was recorded under "Other operating income" in the accompanying income statement.
• · "Cost of sales" reflects the project development expenses re-invoiced by GR Perú, SAC.
• · "Services received" includes the lease expenses for the premises where the Company performs its activities and the management fees invoiced by Daruan V.C.

Year ended December 31, 2018

	Parent company	Other group companies	Key management personnel	Total
Income	-	20,251,088	-	20,251,088
Sales	-	19,616,911	-	19,616,911
Other current operating income	-	537,384	-	537,384
Accrued interest	-	96,793	-	96,793
Expenses	-	250,787	292,168	542,955
Services received	-	250,787	-	250,787
Remuneration	-	-	292,168	292,168

The transactions with related parties carried out during 2018 relate to the normal course of the Company's business and were generally carried out on an arm's length basis. The most significant transactions were the following:

• · Sale of necessary components for solar installations (panels, investors, etc.) to Grenergy Pacific Ltda. for a total amount of 19,616,911 euros.
• · Other current operating income includes management fees invoiced to the group's subsidiaries.
• · "Services received" includes the lease expense for the premises where Nagara Nur, S.L. has its registered address as well as the management fees invoiced by Daruan V.C.

20.2. Disclosures relating to the directors and senior management

During 2019 and 2018 the Company did not extend its directors any advances or credit, nor did it assume any obligations on their behalf by way of guarantees extended. Likewise, the Company has no pension or life insurance commitments for any of its current or former directors.

The directors and senior management received remuneration as per the following breakdown:

	2019		2018
Type of remuneration	Board of Directors	Senior management	Board of Directors	Senior management
Fixed remuneration	202,286	457,645	198,000	90,000
Compensation in kind	7,401	707,189	-	4,168
Total	209,687	1,164,834	198,000	94,168

The breakdown of remuneration for the Board of Directors in 2019 and 2018 is as follows:

Counselor	Position	2019		2018
		Fixed remuneration	Compensation in kind	Fixed remuneration	Compensation in kind
D. David Ruiz de Andres	President/ CEO	120,000	7,401	120,000	-
D. Florentino Vivancos Gasset	Board member	31,736	-	30,000	-
Dna. Ana Peralta Moreno	Vocal	30,000	-	30,000	-
D. Nicolas Bergareche Mendoza	Vocal	18,000	-	18,000	-
Dila. Maria del Rocio Hortiguela Esturillo	Vocal	2,550	-		-
	TOTAL	202.286	7,401	198,000	-

As indicated in Note 4.13, the incentive plan approved for the directors, executives, employees, and key collaborators of Grenergy was exclusively offered to the employees and key collaborators of the Company and none of the directors or senior management.

The directors of the Company are covered by a civil liability policy for which the Company disbursed 19 and 3 thousand euros in 2019 and 2018, respectively.

20.3. Other disclosures relating to the directors

At the date of authorization of these financial statements none of the members of the Board of Directors disclosed any conflicts of interest, direct or indirect, with those of the Company in connection with said members themselves or any persons to whom article 231 of the Spanish Corporate Enterprises Act refers.

21. Other disclosures

21.1. Risk management policy

The activities of the Company are exposed to various financial risks: market risk (including exchange rate risk) and liquidity risk. The Company's risk management is focused on the uncertainty of financial markets and attempts to minimize the potentially adverse effects on its profitability, using certain financial instruments for this purpose, described further on in the notes.

Market risk

The market in which the Company operates is related to the sector for production and commercialization of renewable energies. It is for this reason that the factors which influence said market positively and negatively can affect the Company's performance.

Market risk in the electricity sector is based on a complex price formation process in each of the markets in which the Company performs its business activities.

In general, the price of products offered in the sector of renewable energies contains a regulated component as well as a market component. The first is controlled by the competent authorities of each country or market and can vary whenever said authorities consider it appropriate and necessary, resulting in an obligation for all market agents to adapt to the new circumstances. The cost of energy production would be affected as well as distribution to networks, thereby also affecting the price paid by the Company's clients, either with respect to the negotiation of purchase-sales prices for its projects or price formation in the wholesale market ("merchant"), or under the Power Purchase Agreements ("PPAs").

As far as the market component is concerned, there is the risk that the competitors of Grenergy, both for renewable energies as well as for conventional energies, may be able to offer lower prices, generating competition in the market which, via pricing, may endanger the stability of the Grenergy client portfolio and could thereby provoke a substantial negative impact on its activities, results, and financial position.

At any rate, as the performance of said sector varies significantly from country to country and continent to continent, three years ago the Group initiated a geographical diversification process, breaking into markets outside Spain (currently the Group is present in Spain, Chile, Mexico, Colombia, Argentina, and Peru), thereby reducing this type of risk even more. At present, all the efforts being made by Grenergy are focused on further developing the projects it owns in these countries.

Product responsibility

The Company designs, develops, executes, and promotes large scale renewable energy projects, certified by TÜV Rheinland. Its integrated quality management system (ISO9001) and environmental management system (ISO 14001) systematize the identification of each project's requirements in terms of quality, safety, and efficiency for each of the phases of said projects.

Client credit risk for Operations and Maintenance (O&M) and Asset Management ("AM") services

With respect to those projects for which Grenergy performs its O&M and AM services, credit risk arises from non-compliance with the recurring payment obligations of the clients party to said contracts, in spite of the fact that these contracts generally foresee quarterly commission payments and payments 30 days subsequent to the issuing of invoices.

The percentage of allowances for insolvencies was zero for 2019.

Exchange rate risk

GRENERGY performs a large part of its economic activities abroad and outside the European market, specifically, in Chile, Peru, Argentina, Mexico, and Colombia. At December 31, 2019 practically all Grenergy revenue was denominated in currencies other than the euro, specifically, the US dollar. Likewise, a large part of the expenses and investments, mainly corresponding to expenses incurred for consumables required in construction activities and investments in development projects, were also denominated in US dollars.

As a consequence of the fluctuations in the value of the US dollar with respect to the euro, and to the extent that the Group does not at present have any mechanisms or hedging agreements for mitigating exchange rate risks, Grenergy could suffer a negative impact.

Liquidity risk

Liquidity risk refers to the possibility that the Company may not be able to meet its financial commitments in the short term. As the Company's business is capital intensive and involves long term debt, it is important for the Company to analyze the cash flows generated by the business so that it can fulfill its debt payment obligations, both financial and commercial.

Liquidity risk arises from the financing needs of Grenergy's activities due to the time lag between requirements being met and the generation of funds. The management of this risk by the Company is based on the rapid rotation of projects, thus allowing it to obtain significant cash flows, subsequently reinvesting them in new projects, and the availability of working capital facilities and credit financing with different financial entities for operations abroad.

As the Company has no significant financial commitments in the short term, at the date of authorization of these financial statements, the cash flows generated in the short term by the Company are sufficient to meet the maturities of financial and commercial debt in the short term.

Interest rate risk

The changes in variable interest rates (e.g. EURIBOR) alter the future flows of assets and liabilities referenced to such rates, especially short and long-term financial debt. The objective of Grenergy's interest rate risk management policy is to achieve a balanced structure of financial debt with a view to reducing the financial cost of debt to the extent possible.

21.2. Guarantees extended to third parties

At 2019 year end, the Company held guarantees and sureties with respect to third parties in the amount of 45,286,171 euros, mainly guarantees for the presentation of tenders and participation in auctions for renewable energies (9,016,949 euros at 2018 year end).

21.3. Audit fees for the auditors and related entities

The audit company Ernst & Young, S.L. performed the audit of the annual accounts for 2019, charging the following fees for professional services:

	2019
Audit services:	99,250
Other audit-related services:	32,500
Total	131,750

The audit company Mazars Auditores, S.L.P. carried out the audit of the annual accounts for 2018, charging the following fees for professional services:

	2018
Audit services:	50,800
Other audit-related services:	-
Total	50,800

The above amounts include all audit-related fees for 2019 and 2018, irrespective of the invoice date.

22. Segmented information

The geographical distribution of revenue for 2019 and 2018 is as follows:

	2019	2018
Chile	52,062,657	23,304,156
Spain	237,097	231,671
Peru	2,562,358	-
Total	54,862,112	23,535,827

23. Events after the reporting period

No significant events took place from December 31, 2019 to the date on which the Company's Board of Directors authorized these financial statements that require disclosure.

24. Explanation to the translation to English

These Annual Accounts are presented on the basis of accounting principles generally accepted in Spain. Consequently, certain accounting practices applied by the Company, may not conform to general accepted principles in other countries.

									(Amounts in Euros)
			% capital - voting rights Balances at 12.31.19						Share
Company name	Registered address	Activity		Direct Indirect Total		Company name	Registered address	Activity	capital Direct		Reserves Other equity items	Operating profit	Profit for the year Continuing operations	Discontinued operations	Total equity of the investee
GREENHOUSE SOLAR FIELDS, S.L.	Spain	Production of renewable electric energy	100%	-	100%	3.006	-	3.006	3.006	(576)	-	(150)	(113)	-	2.317
GREENHOUSE SOLAR ENERGY, S.L.	Spain	Production of renewable electric energy	100%	-	100%	3.006	-	3.006	3.006	(414)	-	(150)	(113)	-	2.479
GREENHOUSE RENEWABLE ENERGY, S.L.	Spain	Production of renewable electric energy	100%	-	100%	3.006	-	3.006	3.006	(299)	-	(150)	(113)	-	2.594
GUIA DE ISORA SOLAR 2, S.L.	Spain	Production of renewable electric energy	100%	-	100%	1.565	-	1.565	3.100	(6.592)	-	(395)	(296)	-	(3.788)
GR SOLAR 2020, S.L.	Spain	Production of renewable electric energy	100%	-	100%	3.000	-	3.000	3.000	(1.901)	-	(4)	(3)	-	1.096
GR SUN SPAIN, S.L.	Spain	Production of renewable electric energy	100%	-	100%	3.000	-	3.000	3.000	(2.505)	-	-	-	-	495
GR EQUITY WIND AND SOLAR, S.L.	Spain	Production of renewable electric energy	100%	-	100%	3.000	-	3.000	3.000	273.911	-	(154)	13.219	-	290.130
LEVEL FOTOVOLTAICA S.L.	Spain	Production of renewable electric energy (inactive company)	50%	-	50%	1.504	-	1.504		3.008 (322.662)	-	(4.860)	(4.893)	-	(324.547)
GR BAÑUELA RENOVABLES, S.L.	Spain	Production of renewable electric energy	100%	-	100%	3.000	-	3.000	3.000	(617)	-	-	-	-	2.383
GR TURBON RENOVABLES, S.L.	Spain	Production of renewable electric energy	100%	-	100%	3.000	-	3.000	3.000	(611)	-	-	-	-	2.389
GR AITANA RENOVABLES, S.L.	Spain	Production of renewable electric energy	100%	-	100%	3.000	-	3.000	3.000	(593)	-	-	-	-	2.407
GR ASPE RENOVABLES, S.L.	Spain	Production of renewable electric energy	100%	-	100%	3.000	-	3.000	3.000	(620)	-	-	-	-	2.380
VIATRES RENEWABLE ENERGY, S.L.	Spain	Production of renewable electric energy (inactive company)	40%	-	40%	1.200	-	1.200	3.000	-	-	-	-	-	3.000
EIDEN RENOVABLES, S.L.	Spain	Production of renewable electric energy	100%	-	100%	3.000	-	3.000	3.000	(349)	-	-	-	-	2.651
CHAMBO RENOVABLES, S.L.	Spain	Production of renewable electric energy	100%	-	100%	3.000	-	3.000	3.000	(349)	-	-	-	-	2.651
MAMBAR RENOVABLES, S.L.	Spain	Production of renewable electric energy	100%	-	100%	3.000	-	3.000	3.000	(348)	-	-	-	-	2.652
EL AGUILA RENOVABLES, S.L.	Spain	Production of renewable electric energy	100%	-	100%	3.000	-	3.000	3.000	(289)	-	-	-	-	2.711
EUGABA RENOVABLES, S.L.	Spain	Production of renewable electric energy	100%	-	100%	3.000	-	3.000	3.000	(368)	-	389	292	-	2.924
TAKE RENOVABLES, S.L.	Spain	Production of renewable electric energy	100%	-	100%	3.000	-	3.000	3.000	(391)	-	414	311	-	2.920

												(Amounts in Euros)
				% capital - voting rights			Balances at 12.31.19						Profit for the year
Company name	Registered address	Activity		Direct Indirect	Total	Cost	Impairment	Carrying amount	Share capital		Reserves Other equity items	Operating profit	Continuing operations	Discontinued operations	Total equity of the investee
NEGUA RENOVABLES, S.L.	Spain	Production of renewable electric energy	100%	-	100%	3.000	-	3.000	3.000	575	-	(533)	(399)	-	3.176
GR SISON RENOVABLES, S.L.U.	Spain	Production of renewable electric energy (inactive company)	100%	-	100%	3.000 (3.000)	-	-	-	-	-	-	-	-	-
GR PORRON RENOVABLES, S.L.U.	Spain	Production of renewable electric energy (inactive company)	100%	-	100%	3.000 (3.000)	-	-	-	-	-	-	-	-	-
GR BISBITA RENOVABLES S.L.U.	Spain	Production of renewable electric energy (inactive company)	100%	-	100%	3.000 (3.000)	-	-	-	-	-	-	-	-	-
GR AVUTARDA RENOVABLES, S.L.U.	Spain	Production of renewable electric energy (inactive company)	100%	-	100%	3.000 (3.000)	-	-	-	-	-	-	-	-	-
GR COLIMBO RENOVABLES, S.L.U.	Spain	Production of renewable electric energy (inactive company)	100%	-	100%	3.000 (3.000)	-	-	-	-	-	-	-	-	-
GR MANDARIN RENOVABLES S.L.U.	Spain	Production of renewable electric energy (inactive company)	100%	-	100%	3.000 (3.000)	-	-	-	-	-	-	-	-	-
GR DANICO RENOVABLES S.L.U.	Spain	Production of renewable electric energy (inactive company)	100%	-	100%	3.000 (3.000)	-	-	-	-	-	-	-	-	-
GR CHARRAN RENOVABLES S.L.U.	Spain	Production of renewable electric energy (inactive company)	100%	-	100%	3.000 (3.000)	-	-	-	-	-	-	-	-	-
GR CERCETA RENOVABLES S.L.U.	Spain	Production of renewable electric energy (inactive company)	100%	-	100%	3.000 (3.000)	-	-	-	-	-	-	-	-	-
GR CALAMON RENOVABLES S.L.U.	Spain	Production of renewable electric energy (inactive company)	100%	-	100%	3.000 (3.000)	-	-	-	-	-	-	-	-	-
GR CORMORAN RENOVABLES S.L.U.	Spain	Production of renewable electric energy (inactive company)	100%	-	100%	3.000 (3.000)	-	-	-	-	-	-	-	-	-
GR GARCILLA RENOVABLES S.L.U.	Spain	Production of renewable electric energy (inactive company)	100%	-	100%	3.000 (3.000)	-	-	-	-	-	-	-	-	-
GR LAUNICO RENOVABLES S.L.U.	Spain	Production of renewable electric energy (inactive company)	100%	-	100%	3.000 (3.000)	-	-	-	-	-	-	-	-	-
GR MALVASIA RENOVABLES S.L.U.	Spain	Production of renewable electric energy (inactive company)	100%	-	100%	3.000 (3.000)	-	-	-	-	-	-	-	-	-
GR MARTINETA RENOVABLES S.L.U.	Spain	Production of renewable electric energy (inactive company)	100%	-	100%	3.000 (3.000)	-	-	-	-	-	-	-	-	-
GR FAISAN RENOVABLES S.L.U.	Spain	Production of renewable electric energy (inactive company)	100%	-	100%	3.000 (3.000)	-	-	-	-	-	-	-	-	-
GRENERGY PACIFIC LTDA	Chile	Production of renewable electric energy (inactive company)	99,9%	-	99,9%	43.150	-	43.150		35.732 1.289.309	(141.875)	517.350	69.501	-	1.252.667
GR PEUMO, S.P.A.	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.408 (1.408)	-	-	-	-	-	-	-	-	-
GR QUEULE, S.P.A.	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.408 (1.408)	-	-	-	-	-	-	-	-	-

									(Amounts in Euros)
				% capital - voting rights			Balances at 12.31.19				Profit for the year
Company name	Registered address	Activity		Direct Indirect	Total	Cost	Impairment	Carrying amount	Share capital	Reserves	Other equity items	Operating profit	Continuing operations	Discontinued operations	Total equity of the investee
GR MAITEN, S.P.A.	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.408 (1.408)	-	-	-	-	-	-	-	-	-
GR ALGARROBO S.P.A	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.303 (1.303)	-	-	-	-	-	-	-	-	-
GR PACIFIC CHILOE SPA	Chile	Production of renewable electric energy (inactive company)	-	98%	98,0%	917 (917)	-	-	-	-	-	-	-	-	-
GR PACIFIC OVALLE, SPA	Chile	Production of renewable electric energy (inactive company)	-	98%	98,0%	1.357 (1.357)	-	-		970.530 (962.949)	-	168	(20)	-	7.561
GR PIMIENTO, SPA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.357 (1.357)	-	-	-	-	-	-	-	-	-
GR CHAÑAR, SPA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.357 (1.357)	-	-	-	-	-	-	-	-	-
GR CARZA, SPA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.357 (1.357)	-	-	-	-	-	-	-	-	-
GR PILO, SPA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.357 (1.357)	-	-	-	-	-	-	-	-	-
GR LÚCUMO, SPA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.357 (1.357)	-	-	-	-	-	-	-	-	-
GR PITAO, SPA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.357 (1.357)	-	-	-	-	-	-	-	-	-
GR LLEUQUE, SPA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.357 (1.357)	-	-	-	-	-	-	-	-	-
GR NOTRO, SPA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.357 (1.357)	-	-	-	-	-	-	-	-	-
GR LENGA, SPA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.357 (1.357)	-	-	-	-	-	-	-	-	-
GR TEPÚ, SPA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.357 (1.357)	-	-	-	-	-	-	-	-	-
GR LUMILLA, SPA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.357 (1.357)	-	-	-	-	-	-	-	-	-
GR TOROMIRO, SPA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.357 (1.357)	-	-	-	-	-	-	-	-	-
GR PACAMA,S PA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.357 (1.357)	-	-	-	-	-	-	-	-	-
GR TEMO, SPA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.357 (1.357)	-	-	-	-	-	-	-	-	-
GR RULI, SPA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.357 (1.357)	-	-	-	-	-	-	-	-	-
GR POLPAICO PACIFIC, SPA	Chile	Production of renewable electric energy (inactive company)	-	98%	98,0%	1.314 (1.314)	-	-	-	-	-	-	-	-	-
GR Roble SpA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.441 (1.441)	-	-	-	-	-	-	-	-	-

				% capital - voting rights			Balances at 12.31.19					(Amounts in Euros)	Profit for the year
Company name	Registered address	Activity		Direct Indirect	Total	Cost	Impairment	Carrying amount	Share capital	Reserves	Other equity items	Operating profit	Continuing operations	Discontinued operations	Total equity of the investee
GR Guindo SpA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.441 (1.441)	-	-	1.191	(119)	-	(21.366)	(21.366)	-	(20.294)
GR Raulí SpA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.441 (1.441)	-	-	-	-	-	-	-	-	-
GR Manzano SpA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.441 (1.441)	-	-	-	-	-	-	-	-	-
GR Naranjillo SpA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.441 (1.441)	-	-	-	-	-	-	-	-	-
GR Mañio SpA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.441 (1.441)	-	-	-	-	-	-	-	-	-
GR Tara SpA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.441 (1.441)	-	-	-	-	-	-	-	-	-
GR Ciprés SpA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.441 (1.441)	-	-	-	-	-	-	-	-	-
GR Ulmo SpA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.441 (1.441)	-	-	-	-	-	-	-	-	-
GR Hualo SpA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.441 (1.441)	-	-	-	-	-	-	-	-	-
GR Sauce SpA	Chile	Production of renewable electric energy	100%	-	100,0%	1.441 (1.441)	-	-	1.191	(358)	-	2.207	(12.804)	-	(11.971)
GR Huacano SpA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.258 (1.258)	-	-	-	-	-	-	-	-	-
GR Corcolén SpA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.258 (1.258)	-	-	-	-	-	-	-	-	-
GR Luma SpA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.258 (1.258)	-	-	-	-	-	-	-	-	-
GR Fuinque SpA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.258 (1.258)	-	-	-	-	-	-	-	-	-
GR Piñol SpA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.258 (1.258)	-	-	-	-	-	-	-	-	-
GR Queñoa SpA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.258 (1.258)	-	-	-	-	-	-	-	-	-
GR Tayú Spa	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.258 (1.258)	-	-	-	-	-	-	-	-	-
GR Petra SpA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.258 (1.258)	-	-	-	-	-	-	-	-	-
GR Corontillo SpA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.258 (1.258)	-	-	-	-	-	-	-	-	-
GR Liun SpA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.258 (1.258)	-	-	-	-	-	-	-	-	-
GR Kewiña SpA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.258 (1.258)	-	-	-	-	-	-	-	-	-

									(Amounts in Euros)
			% capital - voting rights Balances at 12.31.19							Profit for the year
Company name	Registered address	Activity		Direct Indirect	Total	Cost	Impairment	Carrying amount	Share capital	Reserves	Other equity items	Operating profit	Continuing operations	Discontinued operations	Total equity of the investee
GR Frangel SpA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.258 (1.258)	-	-	-	-	-	-	-	-	-
GR Maqui SpA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.258 (1.258)	-	-	-	-	-	-	-	-	-
GR Petrillo SpA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.258 (1.258)	-	-	-	-	-	-	-	-	-
GR Tepa SpA	Chile	Production of renewable electric energy (inactive company)	100%	-	100,0%	1.258 (1.258)	-	-	-	-	-	-	-	-	-
Grenergy OPEX SpA	Chile	Operation and maintenance of renewable energy plants	100%	-	100,0%	1.258	-	1.258	1.191	-	-	102.141	73.471	-	74.662
Parque Eólico Quillagua SpA	Chile	Operation and maintenance of renewable energy plants	100%	-	100,0%	14.907.246	-	14.907.246		19.343.306 (1.531.547)	(477.733)	79.340	(298.699)	-	17.035.327
GRENERGY PERU SAC	Peru	Production of renewable electric energy 99%		-	99%	275	-	275	275	(810.720)	-	603.265	639.558	-	(170.887)
GR JULIACA, S.A.C.	Peru	Production of renewable electric energy (inactive company)	100%	-	100%	255	-	255	255	-	-	-	-	-	255
GR HUAMBOS, S.A.C.	Peru	Production of renewable electric energy (inactive company)	100%	-	100%	255	-	255	255	-	-	-	-	-	255
GR APORIC, S.A.C.	Peru	Production of renewable electric energy (inactive company)	100%	-	100%	255	-	255	255	-	-	-	-	-	255
GR BAYONAR, S.A.C.	Peru	Production of renewable electric energy (inactive company)	100%	-	100%	255	-	255	255	-	-	-	-	-	255
GR VALE S.A.C.	Peru	Production of renewable electric energy (inactive company)	100%	-	100%	255	-	255	255	-	-	-	-	-	255
GR CORTARRAMA S.A.C.	Peru	Production of renewable electric energy (inactive company)	100%	-	100%	278 (278)	-	-	-	-	-	-	-	-	-
GR GUANACO S.A.C.	Peru	Production of renewable electric energy (inactive company)	100%	-	100%	278 (278)	-	-	-	-	-	-	-	-	-
GR TARUCA S.A.C.	Peru	Production of renewable electric energy 90%		-	90%	2.862.143	-	2.862.143	3.229.815	96.067	-	(34.044)	56.849	-	3.382.731
GR PAINO S.A.C.	Peru	Production of renewable electric energy	90%	-	90%	2.872.698	-	2.872.698	3.241.615	96.147	-	(27.555)	38.471	-	3.376.233
GR PAICHE S.A.C.	Peru	Production of renewable electric energy (inactive company)	100%	-	100%	278 (278)	-	-	-	-	-	-	-	-	-
GR LIBLANCA S.A.C.	Peru	Production of renewable electric energy (inactive company)	100%	-	100%	278 (278)	-	-	-	-	-	-	-	-	-
GR RENOVABLES MÉXICO	Mexico	Promotion and construction of electric energy installations	98%	-	98%	2.843	-	2.843		2.358 (1.505.453)	-	(91.217)	(46.006)	-	(1.549.101)
GREENHUB S.L. DE C.V.	Mexico	Production of renewable electric energy	20%	80%	100%	17.799	-	17.799	96.684	2.325	-	(30.483)	(30.483)	-	68.526

													(Amounts in Euros)
				% capital - voting rights			Balances at 12.31.19				Other		Profit for the year		Total equity
Company name	Registered address	Activity		Direct Indirect	Total	Cost	Impairment	Carrying amount	Share capital	Reserves	equity items	Operating profit	Continuing operations	Discontinued operations	of the investee
FAILO 3 SACV	Mexico	Production of renewable electric energy (inactive company)	-	50%	50%	-	-	-	15.311	(16.361)	-	-	-	-	(1.050)
ASTILO 1 SOLAR, SACV	Mexico	Production of renewable electric energy (inactive company)	-		99,99% 99,99%	2.790 (2.790)	-	-	2.358	(28.637)	-	-	-	-	(26.279)
CRISON 2 SOLAR, SACV	Mexico	Production of renewable electric energy (inactive company)	-		99,99% 99,99%	2.790 (2.790)	-	-	2.358	(2.279)	-	-	-	-	79
MESO 4 SOLAR, SACV	Mexico	Production of renewable electric energy (inactive company)	-		99,99% 99,99%	2.790 (2.790)	-	-	2.358	(25.281)	-	-	-	-	(22.923)
ORSIPO 5 SOLAR, SACV	Mexico	Production of renewable electric energy	-		99,99% 99,99%	2.790 (2.790)	-	-	2.351	5.950	-	(795)	(27.472)	-	(19.171)
MIRGACA 6 SOLAR, SACV	Mexico	Production of renewable electric energy (inactive company)	-		99,99% 99,99%	2.790 (2.790)	-	-	2.358	(436)	-	-	-	-	1.922
GRENERGY COLOMBIA S.A.S.	Colombia	Promotion and construction of electric energy installations	100%	-	100%	270.237	-	270.237		261.720 (109.038)	-	(21.559)	16.966	-	169.648
GRENERGY ATLANTIC, S.A.U.	Argentína	Promotion and construction of electric energy installations	100%	-	100%	103.629	-	103.629	101.644	(62.294)	-	(155.654)	(266.344)	-	(226.994)
KOSTEN S.A.	Argentína	Production of renewable electric energy; promotion and construction of electric energy installations	100%	-	100%	8.158.807	-	8.158.807	5.548.811	45.291	-	(299.416)	(2.130.535)	-	3.463.567

(*) Exchange rate applied at closing of 12.31.2019, with average rates applied to the 2019 income statement. 29.296.646

(**) Audited financial statements

GRENERGY RENOVABLES, S.A. Management Report for 2019

1. Business performance in 2019 and foreseeable performance in 2020

• · Total revenue for the year amounted to 54,862,112 euros, representing an increase of 133% with respect to 2018. This important increase is fundamentally due to the sale of materials, mainly solar panels, to the Grenergy subsidiary in Chile for construction of new photovoltaic installations. Specifically, the following installations were completed and connected during 2019: Santa Rosa, (9MW), Rinconada (9MW), Rovián (8MW), Doñihue (9MW), and Alturas II (3MW). In addition, the following installations were under construction in 2019: Quinta (9MW), Sol de Septiembre (9MW), Lemu (6MW), Placilla (9MW), Rauquén (9MW), La Estancia (3MW), Lo Miranda (6MW), Paraguay (9MW), and Quillagua (103MW). In all of the above Grenergy Renovables S.A. acted as supplier of construction materials for the EPCs. This shows the continuity of the business generated in LATAM some years ago. At present, this region, especially Chile, can be considered the Company base for its activities in 2019 and 2020.
• · The breakdown of all operating income by nature in 2018 was as follows:
  • § Total revenue: 54,862,112 euros:
    • § Sale of solar panels and other materials: 52,062,658 euros
    • § Sale of developments: 2,562,357 euros
    • § O&M income (maintenance of plants): 237,097 euros
  • § TOTAL Other operating income: 1,057,831 euros:
    • § Income from management fees: 1.006.106 euros
    • § Other operating income: 51,725
• · The results for the year before taxes showed profits amounting to 9,028,967 euros, representing an increase of 8% with respect to 2018. Net profits came in at 7,182,026 euros, 7% more than in the prior period. These results confirm the continuity of Grenergy's activities in the development of its projects, construction, and connecting plants, as reflected in last year's management report. In addition, during 2019, 4 photovoltaic solar farms in Chile were transferred together with their respective vehicle entities. Grenergy considers these results as very positive given that they reflect the continuity of growth in Latin America and the consolidation of sales of installations in this region.
• · EBITDA for 2019 totaled 3,112,729 euros, 50% more than in the prior year.
• · The balance for employee benefits expenses increased by 61%, amounting to 2,921,315 euros in 2019, reflecting the strengthening of the workforce and an important sign that talent is being attracted, resulting in a larger corporate structure for Grenergy in all its departments.
• · The finance results for the year were similar to the prior year, amounting to a positive 6,010,227 euros in 2019 as a consequence of selling shareholdings in group companies, all of them vehicle entities which own the developments and permits for transferred projects.
• · Capital and reserves amounted to 35,181,470 euros, increasing by 8 million euros with respect to the prior year end (a 30% increase), which also reflects the continuity of the Company's profit reinvestment policy.
• · In 2020 Grenergy will continue to develop its portfolio of projects via its subsidiaries in Latin America and Spain.
• · The average number of employees during 2019, broken down by professional categories, was the following:

Category	2019
Directors and Senior Management Department directors Other	7 8 28
Total	43

2. Environmental information

One of the characteristic phases in the development of a renewable energy project, whether solar or wind, is the performance of environmental impact studies and issuing of environmental impact statements for particular installations. The main objective in said studies and statements is to measure and reduce the real impact on the environment arising from execution of any project.

The main entities responsible for preventing deterioration of the environment are the competent authorities of the different countries in which Grenergy operates. Thus, assessment of the environmental impact of any activity allows the Company to introduce an environmental dimension to the design and execution of the projects and activities which it performs in each country. This assessment allows for certification that the initiatives, both in the private and public sectors, are in compliance with the applicable environmental requirements.

Though there are various types of environmental impact, they can mainly be classified into three different types in accordance with their origin: (i) environmental impact provoked by the use of natural resources; (ii) environmental impact provoked by contamination; and (iii) environmental impact provoked by the occupation of land.

The projects performed by Grenergy are in general affected mainly by the environmental impact provoked by occupation of land. Thus, at the outset of any project, land is searched for and located whose essential characteristics will not be modified by execution of the project in question or which may even be improved from an environmental point of view.

Another type of environmental impact which may have an effect on the Company's PP&E is the contamination from the machinery sometimes used by Grenergy in performing its activity. Consequently, the persons in charge of executing any phase of developing a project will always try to optimize the organization of teams, adapting it to the terrain.

Based on each project, Grenergy contracts different consultants and engineers specialized in performing environmental impact studies, which are subsequently reviewed by the competent authorities. Once said study has been analyzed in detail by the competent authority, a decision is taken as to the appropriateness of performing the activity being assessed, determining the conditions and measures necessary for adequately protecting the environment and the natural resources associated with the project.

In accordance with prevailing legislation, the Company maintains control over the extent of contamination it produces and implements an appropriate waste disposal policy.

3. Investments in research and development

The Company did not capitalize any amounts relating to R&D investments in 2019.

4. Treasury shares

The possibility of acquiring treasury shares was authorized by the shareholder meeting held on May 19, 2015, permitting acquisition of up to 2,000,000 shares at a price ranging from 0.01 to 5 euros during a period of five years, counting from said date, in order to meet the requirements of the incentive plan for directors, executives, employees, and collaborators, itself designed to motivate and retain its key personnel.

On February 3, 2016 the Board of Directors agreed to purchase shares of Grenergy Renovables, S.A. for its treasury share portfolio, up to a limit of 0.8% of its share capital (equivalent to 181,818 shares), in order for the Company to be able to grant the share options to its executives and employees.

At the date of authorization of the 2019 financial statements, Grenergy Renovables, S.A. has a treasury share portfolio comprised of 556,815 shares.

5. Information on the nature and level of risk of financial instruments

The Company's management of financial risks is centralized in Financial Management, which has established the necessary mechanisms to control exposure to credit and liquidity risk. Note 21.1 describes the most significant financial risks affecting Grenergy. At 2019 year end, Grenergy had not contracted any financial product which could be considered a risk.

6. Average supplier payment term

In compliance with Law 31/2014 of December 3, modifying the third additional provision, "Disclosure requirements," of Law 15/2010 of July 5, the Company declared an average supplier payment term of 52.92 days.

7. Proposed appropriation of profit

The results obtained during the year by Grenergy Renovables, S.A. amount to 7,182,026 euros, of which 6,943,584 euros will be allocated to voluntary reserves and 238,442 euros will be allocated to the capitalization reserve.

8. Final considerations

We would like to thank our clients for their confidence in our business, our strategic suppliers and partners with whom we have been working for their constant support, our investors who have deposited their trust in Grenergy, and, especially, the collaborators and employees of this company, as without their efforts and dedication it would have been difficult to reach the objectives set or achieve the results obtained.

APPROVAL OF THE ANNUAL FINANCIAL STATEMENTS AND MANAGEMENT REPORT

The financial statements and management report for 2019 were approved by the Board of Directors of GRENERGY RENOVABLES, S.A. in its meeting on February 26, 2020, for the purpose of submission for verification by the auditors and subsequent approval by the shareholders in general meeting.

Mr. Florentino Vivancos Gasset is authorized to sign all pages comprising the financial statements and management report for FY 2019.

Signed in the original report issued in Spanish	Signed in the original report issued in Spanish
Mr. David Ruiz de Andrés (Chief Executive Officer)	Mr. Antonio Jiménez Alarcón (Board Member)
Signed in the original report issued in Spanish	Signed in the original report issued in Spanish
Mr. Florentino Vivancos Gasset (Board Member)	Ms. Ana Peralta Moreno (Board Member)
Signed in the original report issued in Spanish	Signed in the original report issued in Spanish

(Board Member) (Board Member)

Mr. Nicolás Bergareche Mendoza Ms. María del Rocío Hortigüela Esturillo

STATEMENT OF RESPONSIBILITY OF THE DIRECTORS OF GRENERGY RENOVABLES, S.A. ON THE CONTENT OF THE ANNAL 2019 SEPARATE AND CONSOLIDATED FINANCIAL STATEMENTS

With regard to the annual separate and consolidated financial statements of Grenergy Renovables, S.A. for 2019, and in accordance with Article 8 of Royal Legislative Decree 4/2015, of October 23, which enacts the consolidated text of the Securities Market Law, the members of the Board of Directors hereby state:

That, to the best of their knowledge, the annual financial statements, prepared in accordance with applicable accounting principles, provide a true and fair view of the financial position and profit and loss of Grenergy Renovables, S.A. and the undertakings included in the consolidation, taken as a whole, and that the directors' report includes a fair view of the development and performance of the businesses and the position of the Grenergy Renovables, S.A. and the undertakings in the consolidation, taken as a whole, together with a description of the principal risks and uncertainties that they face.

Statement issued by the Board of Directors of GRENERGY RENOVABLES, S.A. on February 26, 2020 for the purpose of authorizing the separate and 2019 consolidated financial statements.

(Chief Executive Officer) (Board Member)

__________________________ ________________________________ Mr. David Ruiz de Andrés Mr. Antonio Jiménez Alarcón

__________________________ ________________________________ Mr. Florentino Vivancos Gasset Ms. Ana Peralta Moreno (Board Member) (Board Member)

(Board Member) (Board Member)

___________________________ _________________________________ Mr. Nicolás Bergareche Mendoza Ms. María del Rocío Hortigüela Esturillo