IMPSA S.A. — Interim / Quarterly Report 2020

May 27, 2020

1677-182 (S14) XA- • moo.neusdeherlosevol.www • 0728-182 (S14) The Grant Building . 310 Grant Street . Suite 1020 . Pittsburgh, Pennsylvania 15219-2295

IMPSA INTERNATIONAL. INC.

Financial Statements

0707 (18 чэлем

1077-18S (S14) XA-7 · moo.neuadeherbasevol.www · 07S8-18S (S14) The Grant Building . 310 Grant Sreet . 1920 . 9020 . Plitsburgh, Pennsylvania 15219-2295

TADELEMBER SOLO CONTRALS COMPILATION REPORT

Pittsburgh, Pennsylvania IMPSA International, Inc. To the Board of Directors

completences of the information provided by management. Accordingly, we do not express an financial statements not were we required to perform any procedures to verify the accuracy or Accounting and Review Services Committee of the AICPA. We did not ablue to treview the with Statements on Standards for Accounting and Review Services promulgated by the Accounting Standards Board. We have performed the compilation engagement in accordance accordance with International Financial Reporting Stanbards as issued by the International and cash flow for the 3 months then ended, and the related notes to the financial statements in December 31, 2019, and the related statements of profit and loss, changes in stockholder's equity Inc. (a corporation), which comprise the statement of financial position as of March 31, 2020 and Management is responsible for the accompanying financial statements of IMPSA International,

opinion, a conclusion, nor provide any form of assurance on these financial statements.

Josych G. Golerla

Joseph S. Scherle, CPA

COUNTY OF: ALLEGHENY VINVATASNNAJ СОМИОЛАЕ ИТ НОВ

Notary Public

OZOZ AVIV JO AVC 4161 SIHL FIV

SWORN TO AND SUBSCRIBED BEFORE

0202 '61 APM Pittsburgh, Pennsylvania

Gommonwealth of Pennsylvania

My Commission Expires Aug 28, 2021 CITY OF PITTSBURGH, ALLEGHENY COUNTY LOUISE R VUONO - Notary Public IBAS IBURION

DISPUTERIOUS TRANSPORT TRANSPORT

NOILISOJ TVIDNVNIJ JO SINTWELVLS

MARCH 31, 2020 AND DECEMBER 31, 2019

6107 DECEMBEK 31'		0707 NVKCH31'	SHLON	ASSETS:
				Current Assets:
Z L V Z		91Z	$S$ pue $Z$	Cash and cash equivalents
Z61'0L1'S 009'816'1		Z6I'0LI'S 008'816'1	E $E$ pue $Z$	Notes receivable - affiliated companies Accounts receivable - affiliated companies
796'060'L		80L'880 ' L		Total Current Assets
			$\nu$ pue $\nu$	Deferred income tax benefit Non-Current Assets:
				Total Non-Current Assets
V96'060'L	$\mathbf S$	80L'880 ' L	\$	Total Assets
				TIVBILITIES:
				Current Liabilities:
EPP'E88'I	S	917'588'1	\$ L	$\gamma$ cconura ba $\lambda$ aple
$000 \mathcal{E}$ ΣΕΙ΄ ΦΕΙ΄ Ε		$000 \, \epsilon$ $\text{II6}'\text{ISL}'\epsilon$	Þ ε	hoome taxes payable Accounts payable - affiliated companies
SLS'0Z9'S		LZI'0b9'S		Total Current Liabilities
				STOCKHOLDER'S EQUITY:
00I		00 I		Common stock
006'tEL'Z		2,734,900		lstiqso ni-bisq lanoitibbA
$(119°$ b9 $\overline{7}^r\overline{1})$		(61 0 98 2 1)		Retained earnings (deficit)
$68\epsilon'0L\bar{v}'$		1,448,581		Total Stockholder's Equity
$\frac{1}{2}96'060'L$	$\overline{\mathsf{s}}$	80L'880'L

DIVISO INTERNATIONAL INC.

SIATEMENT OF PROFIL OR LOSS

EQR THE THREE MONTHS ENDED MVRCH 31' 5050 VND MVRCH 31' 5010

	SHION	0z 0 z March 31,		6107 Магећ 31,
Net sales of goods and services	$\epsilon$ pue $\zeta$	\$	\$
Interest income	E pue z
Administrative expenses	E	(808'17)		$(50L^{\prime}$
Interest expense	ε
Cther				$(0\overline{z})$
Profit (Loss) Before Income Taxes		(808'17)		$(z\tau/\tau)$
hcome taxes	$\not\vdash$ pue $\zeta$
Profit (Loss) For The Period		\$ (808'17)	\$	(54.72)
Earnings (Loss) Per Share		(817)	\$	$(L\tau Z)$

TOWER THE EXPLICITY THE TERM

STATEMENTS OF CHANGES IN STOCKHOLDER'S EQUITY

FOR THE THREE MONTHS ENDED MARCH 31, 2020 AND MARCH 31, 2019

Equity s'nabloderad2 Total of	Deficit Earnings Retained	Lapital ni-bia q lanoitibbA	Ptock $C$ ommon
$SSS'SLS'I$ \$	$(SI\psi'9SI'I)$ \$	$006'$ + $\epsilon$ 2 $\zeta$ 5	\$ 00I	Balance as of December 31, 2018
$(z\tau/\tau)$	(zz/iz)			ended March 31, 2019 Loss for the 3 month period
$\overline{798^{\circ}$ ESS $^{\circ}$ T $\mathbf{\hat{S}}$	$(8E1'181')$ s	$006'$ v $EZ$ 7	00I \$	Balance as of March 31, 2019
$68\epsilon'0L\psi'$ I $\mathbf{\$}$	$(119.797)$ \$	006'tEL'Z \$	\$ 00I	Balance as of December 31, 2019
(808'17)	(808.15)			ended March 31, 2020 Loss for the 3 month period
$185'8$ rt'I \$.	$(6129821)$ \$	$006'$ v $\overline{c}$ $\overline{c}$ $\overline{s}$	00I \$	Balance as of March 31, 2020

Issued - 100 shares Authorized - $1,000$ shares $\,$ range - $\,$ spin $\,$

DIE TERNATION TO A TERMIT TERMIT

SMOTH HSVO AO SLNAWALVLS

EOR THE THREE MONTHS ENDED MARCH 30' 3020 AND MARCH 30' 2019

610Z Иагећ 31,	0707 $\mathbf{u}$ arch 31,	SHLON
			ЭБЕВАТПА АСТІVІТІЕS:
$96t^{\prime}$ \$ $(z\tau/\tau)$	ELL 2 I (808'17) \$		Increase (decrease) in accounts payable Profit (loss) for the period
$$06′$ tZ	$6LL^{\prime}LL$		affiliated companies Increase (decrease) in accounts payable -
			Interest expense recognized in profit or loss
$8L9^{\circ}$	(957 2 )		Cash Provided (Used) by Operations
			Interest Paid
$8L9^{\circ}$	(9ST'T)		Net Cash Used by Operating Activities
8L9'7	(957)		$\text{CanB}}$ Net Increase (Decrease) in Cash and
$E9E^cS$	ZLbZ		Cash and Cash Equivalents - Beginning of Period
\$ $I\psi0'8$	\$ 9I Z	$\mathsf S$	Cash and Cash Equivalents - End of Period

MARCH 31, 2020 AND MARCH 31, 2019 SLNAWALVLS TVIONVNIA OL SALON TALEX TALE KING TALE TACT

IOLE I - GENERAL INFORMATION:

sincipal place of business is located in Pittsburgh, Pennsylvania. sentina and has seles to affiliated companies. The Company is a United States of America corporation whose the Company also receives a commission from the parent company for sales of equipment manufactured in termational, Inc. acquires material requisiupped by the parent and affiliated companies on a commission basis. APSA International, Inc. is a wholly-owned subsidiary of IMPSA S.A., an Argentine based company. IMPSA

SEXUS TO ANDER SECTION SECTION INTEREST SOLUTIONS:

financial Reporting Standards. transment of Compliance - The financial statements have been prepared in accordance with international

ansuscions date and the resulting exchange differences are recognized in the income statement. enpapy. Monetary transactions denominated in foreign currencies are translated at the exchange rate on the antencies - The financial statements are presented in U.S. dollars, which is the functional currency of the

olicies are as follows: generally based on the fair value of consideration given in exchange for assets. The principal accounting asis of Preparadio $-$ The financial statements have been prepared on the historical cost basis. Historical cost

ctual results may differ from these estimates. secciated assumptions are based on historical experience and other factors that are considered to be relevant. te carrying amounts of assets and liabilities that are not readily apparent irom other sources. The estimates and tuods accounting policies, management is required to make judgments, estimates and assumptions about anical Accounting Judgments and Key Sources of Estimation Uncertainty - In the application of the

eriod of the revision and future periods if the revision affects both current and future periods. excognized on the period in which the estimate is revised if the revision affects only that period or in the Exercity and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates

e disclosed in the relevant asset and liability notes to the financial statements. videnti propostava pa management in applying accounting policies and key sources of estimation uncertainty

hounts exchanged which equates to cost. Accounts payable are described in Note 7. instructed and the passed on secounts payable and long-term debt are recognized at fair value based on transferies companies are recognized at fair value based on amounts exchanged which equates to cost. Detect to the strilling of the set of the system of the set of the stribed in Note 3. Accounts and notes receivable encial distances - Financial assets consist of cash and cash equivalents and accounts and notes receivable

Exognition of the financial asset, the estimated future cash flows of the investment have been impacted. instruct that the state objective evidence that, as a result of one or more events that occurred after the initial parametal assess are assessed for indicators of impairment at each balance sheet date. Financial assets are

ferest rate. Exercise of the present value of estimated future cash flows, discounted the financial assets original effective gar financial assets carried at cost, the amount of the impairment is the difference between the asset's carrying

MOTE 2 - SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):

$\hat{\mathbf{h}}$ receivables. Receivables are due from the parent company and affiliates. $\epsilon$ poncentrations of Credit Risk – Financial instruments potentially subject to concentrations of eredit risk consist

palled noject for the parent company or affiliate. Income from sales to affiliated companies is recognized when Basical company or affiliates or at the time cash is received for a sale when the Company successfully bids on a Revenue Recognition - Commission income is recognized at the tint and a purchase order is placed for the

ncome Taxes - Income tax expenser represents the sums of the tax currently paysble and deferred tax.

anter tax is calculated using tax rates in effect at the balance sheet date. to the vears and it further excludes items that are never taxable or deductible. The Company's liability for exported in the income statement because it excludes items of income or expense that are tasked or deductible Eurently payable income taxes are based on taxable profit tor the year. Taxable profit tiffers from profit as

Frouting date, to recover the carrying amount of its benefit. experis teflects the tax consequences that would follow from the manner in which the Company expects, at the saset is realized, based on tast rates in effect at the balance sheet date. The measurement of the deferred tax Ecovered. The deferred tax benefit is measured at the tax as that are expected to apply in the period in which it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be The carrying amount of the deferred tax benefit is reviewed at each balance sheet date and reduced to the extent

situomonin³ sued capital, reserves and retained earnings). The Company is not subject to any externally imposed capital gues of the Company consists of payables to affiliated companies and equity of the Company (comptetions guession in be able to continue as a going concern while maximizing the return to its parent company. The capital sapital Risk Management - The Company in concert with its parent company manages its capital to ensure that

EXERUS - SETVIED PARTY TRANSACTIONS:

$\ddagger$ 2020 and December 31, 2019 was \$3,715,734 and \$3,698,384, 1espectively. exounts payable - affiliated companies. The balance due from the Company to its parent company at March ador affiliates. The anounts are included in the balance sheet as accounts receivable, notes receivable and Eq affiliates, are made in U.S. dollars, and the exchange rate costs are accounted for by the parent company Il advances, as well as accounts receivable, notes receivable and accounts payable from/to the parent company

and were no commissions earned for the three month periods ending March 31, 2020 and March 31, 2019.

Espectively. om affiliated companies was earned for the three months ended March 31, 2020 and March 31, 2019, ate receivable. Prior to December 31, 2017 3% interest was being charged. No interest income on receivables 1. 2020 and December 31, 2019, respectively. Since December 31, 2017 no interest is being charged on this tores receivable from affiliated companies currently consists of a horm amounting to \$5,170,192 at both March

$-610Z$ he renumeration of key management personnel for the three month period babed March 31, 2020 and March

$*5666I$ ມ	$*$ 566'61	Short-term benefits
610 Z Иагећ 31,	0707 March 31,

$\Omega$ charged back to parent company

IOTE 4-TAXES ON INCOME (CREDIT):

:6101 ncome taxes recognized in profit and lost of the three month periods about March 31, 2020 and March 31,

610 Z TE donal!		$\overline{0}$ z $\overline{0}$ z March 31,
	-		$10$ unn
	-		Deferred - net operating loss carryforwards

he income tax effects of temporary differences that gave rise to a net deferred tax asset were as follows:

(000, 001) 000'961	\$ (203,600) 000'607	\$	$V$ aluation allowance Net operating loss carryforwards Non Current Deferred Tax Asset:
6I0Z December 31,	0707 $M$ arch $31$ ,

D% of annual taxable income. Ederal NOL is currently limited to 80% of annual taxable income while the state NOL is currently limited to environg of \$1,540,000 which are available to offset future taxable income through 2040. However, the [\$231,000, which under current law has no expiration date. For state tax purposes, the Company has NOL Le March 31, 2020, the Company had net operating loss ("OOV") carryrorward for federal income tax purposes

eome tax purposes. stized due to the expiration of the previously described net operating loss carryforwards for federal and state Be Company has recorded a valuation allowance to reflect the amount of a deferred tax asset which may not be

experied to accounting profit as follows: income tax expense for the three month periods ended March 31, 2020 and March 31, 2019 can be

009L	008, 0		$V$ aluation allowance
$(009^{\circ}L)$	\$ (008 6 )	S	Income tax expense (credit) calculated at 31%
( EST, AS)	( 808,1S)		Profit (loss) before taxes per income statement
610Z Магећ 31,	0707 March 31,

$\mathbf{B}$ ie of Pennsylvania. ad 2019 payable by the Company on taxable profits under tax law in the United States of America and the e income tax nate used for the above periods is the effective combined federal and state tate of 31% for 2020

SLNATVAIOOA HSVO GNV HSVO - SALO

alance sheet as follows: adi the financial year as shown in the cash flow statement can be reconciled to the related items in the examente in mones market instruments, net of outstanding bank overdrafts. Cash and cash equivalents at the pr the puposes of the cash flow statement, cash and cash equivalents include cash on hand and in banks and

_______ .	912	Φ
610Z December 31,	0707 $\mathbf{H}$ arch 31,

OLE 9 - BORINERS SECURIUS:

Example 1 The Company also has sales to affiliated companies. Eliated companies on a commission basis and sales of equipment manufactured in Argentina on a commission bns Company's primary business segment consists of acquiring materials requisitionized by its parent and

II of the Company's business is conducted in the United States of America.

DATA T ACCOUNTS PAYBLE:

Exempt bayable consist of the following:

610Z December 31,	0707 March 31,
$90L$ T $LEL'$ 188'1 \$	TZL \$65'588'1\$	Withheld psyroll taxes Trade payables
EFFE88T	912'588'T

sure that all payables are paid within the credit timeframe. o interest is charged on accounts payable. The Company has financial risk management policies in place to

SLINE WARDER THE ENDERGED IN EXAMPLE TO A SET OF STATE OF STATE

sine genes of financial instruments are:

come taxes payable		$000^{\circ}$	$000 \, \epsilon$
ecounts payable - affiliated companies		$116'$ ISL'E	SEI PEL'E
eronuts bayable	917'588'1 S		$Ebb$ $E88$ ' I $\$
rancial Liabilities
otes receivable-affiliated companies		Z6I'0LI'S	Z61'0LI'S
ecounts receivable-affiliated companies		00£'816'1	008'816'1
and and cash equivalents	\$	91 Z	\$ $ZL\psi Z$
rancial Assets
		0z 0 z March 31,	6107 December 31,

COMITIBE - ENVICIVE INZURABILISMED):

abilities approximate their fair values. he Directors of the Company consider the carrying amounts of the above financial assets and financial

triner reduce liquidity risk. of lasoqaib ait is and young profiled to financial assess have the liabilities of the Company has at its disposal to exects tacilities and reserve borrowing facilities, by continuously monitoring forecast and actual cash flows he Company in concert with its parent company manages liquidity risk by maintaining adequate reserves, enagement of the Company's short, medium and long-term funding and liquidity management requirements. the its parent company, which as the simulate in appropriate liquidity risk management framework for the trimate responsibility for liquidity risk management rests with the Company's board of directoria in concert

adde required to pay. The table includes both principal and increst cash flows. versity and the undiscounted cash flows of financial liabilities based on the earliest date on which the Company se following table details the Company's remaining contractual maturity for its financial liabilities. The table

Total	$s$ 189 $\overline{A}$ + $\overline{S}$	1-5 Years	1 Rear 01 sqinoM &	suinoM $E-I$	0Z0Z 'TE TOT
917'S88'I \$	\$	\$	$S6t't88'1$ \$	IZL	\$ plds player
$I16'$ ISL'E			$IIG^{\prime}ISL^{\prime}\mathcal{E}$		diagnostics companies enome baλsppe
$000.\epsilon$			$000.\epsilon$		Sume taxes payable
LZIOP9'S S	S		90F6E9.2.2	TZL
Total	$3189X + 5$	$3-5$ Tears	1 Year 01 sqinolV &	sunoM $E-I$	sember 31, 2019
$EbE$ [ $S$ 88' $I$ \$	\$	\$	LEL'I88'I \$	90L 1	\$ alds/and players
ZEI'DEL'E			Ζετ νει ε		satured companies alder bayable
000.E			000.E		once taxes payable
525.020.22			898,819,2 _ 8	90LT

Be undiscounted contractual matrities of the financial assets including interest that will be earned on those $\blacksquare$ powing table details the Company's expected maturity for its financial assets. The table below is based

			01 suinoly $\epsilon$	$E-I$
Total	$SIB3Y + \epsilon$	$SIB3XS-I$	1 Rear	sųjuojų	0707 IE TH
917			ς	917 \$	and cash equivalents
00£'816'I			009'816'1		reliated companies aldavisosi zimus
Z61.071.2			Z61.071.2		reliated companies ESTECCIVALLE
807.880.T_2			ZGF'880'L	$\overline{91}\overline{2}$

$-01 -$

ELE 8 THACINI TRANSPORT IN EXAMPLE 10 ANDED:

			01 atinoM &		$E-I$
IsioT	$\overline{\text{SIB3}}$ + $\overline{\text{S}}$	F-2 Years	1 Year		sutnoM		СТОС. 31, 2019
$ZLf^{\prime}Z$ S				\$	ZLfZ	S	Example cash equivalents
00E'816'I			00£'816'I				sounduloo popertures sldsvieser and developed
SQL, ONL, 2			Z61,071,2				saturdutoo bahal Exectvable
$\frac{1}{2}$ $\frac{1}{2}$ $\frac{1}{2}$ $\frac{1}{2}$ $\frac{1}{2}$ $\frac{1}{2}$ $\frac{1}{2}$ $\frac{1}{2}$ $\frac{1}{2}$ $\frac{1}{2}$ $\frac{1}{2}$ $\frac{1}{2}$ $\frac{1}{2}$ $\frac{1}{2}$ $\frac{1}{2}$ $\frac{1}{2}$ $\frac{1}{2}$ $\frac{1}{2}$ $\frac{1}{2}$ $\frac{1}{2}$ $\frac{1}{2}$ $\frac{1}{2}$			Z6b'880'L	ड	ZLFZ

PARENT COMPANY RESTRUCTURING:

and pending final resolution of the restructuring. Example 1 determined. Certain receivables and payables are likely to be written off the books of the due possible effect of the debt restructuring agreement on IMPSA International, Inc.'s financial we the tell that the strain of the total of the context of the context. As of the date of our and the date of our The community of the state of the state of the state of the particular community will remain with the parent extra operation in Malaysia was severed from the parent company, and offices in China, Columbia and a and to the benefit of the Participating Creditors and changes in certain management personnel. letique s'vinque d'reditors") which included the transfer of 65% of the parent company's capital Alemational, Inc.'s parent company, IMPSA S.A., entered into a debt restructuring agreement with

$-11-$