Jadran d.d. — Interim / Quarterly Report 2017

Feb 28, 2018

JADRAN D.D., CRIKVENICA TEMPORARY UNAUDITED MANAGEMENT REPORT BUSINESS RESULTS I-XII / 2017.

In 2017 Company Jadran d.d. realized 1% more total income than in the same period of 2016 and 13 % more total expenses than in the same period of 2016. In 2017, in the structure of income 14 % more income from accommodation was realizes than in 2016 due to the increase in capacity utilization and a better average price of accommodation in 4 * hotels (Katarina and Omorika), 23 % more income was realized from food and beverages compared to 2016 and 8 % more other incomes were realized compared to the same period last year. In the year 2016, HRK 6,4 million was realized from the sale of property, while in 2017, HRK 30.108 was realized from the same source.

In 2017, 9 % more operating expenses were realized than in the same period of 2016. The food expense in 2017 increased by 24 % compared to 2016 due to the greater recognition of costs in 4 * hotels, and due to the increased number of guests, energy costs increased by 12 % compared to 2016 (investment in air-conditioning systems in $4 *$ hotels and the increased number of guests), the maintenance costs of the facilities increased by 6 % compared to 2016 and the cost of wages increased by 25 % compared to 2016. Amortization expense in 2017 is 17 % higher than amortization in 2016.

In 2017, financial income was higher by 172 %, while financial expense increased by 184 % compared to the same period of 2016.

The loss amounts in 2017 is HRK 4,200,136, while in 2016 the profit after taxation was HRK 3,834,618.

In Crikvenica, 27.02.2018.

Management Board Member		Management Board President
Marija Galjanić Sovar	$\sim$ Julius ULLUI Crikvenica Ured Uprave	Pero Matic

Jadran d.d. za hotelijerstvo i turizam, Bana Jelačića 16, HR-51260 Crikvenica | www.jadran-crikvenica.hr

Uprava:
$T: +385(0)51241222$
$\textbf{F}: +385(0)51241632$
$E:$ uprava@iadran-crikvenica h

Marketing: $T: +385(0)51241970$ $F: +385(0)51241975$ E: marketing@jadran-crikvenica.hr

OIB: 56994999963 Privredna banka d.d. 2340009-1110722690 IBAN: HR4323400091110722690 SWIFT: PBZGHR2X

Temeljni kapital iznosi 491.316.690,00 kn uplaćen u cijelosti podijeljen na 49.131.669 redovnih dionica nominalnog iznosa 10,00 kuna svaka. Društvo je upisano u Sudski registar Trgovačkog suda u Rijeci pri Trgovačkom sudu u Rijeci pod MBS: 040000817. Predsjednik Uprave: mr. sc. Pero Matić, Članica Uprave: Marija Galjanić Sovar, dipl. oec. Predsjednik Nadzornog odbora: Ivo Bašić, dipl. oec

Reporting period: 1.1.2017. 31.12.2017 to Quarterly Financial Report TFI-POD Tax number (MB): 03145662 Registration number (MBS): 040000817 Personal identification 56994999963 number (OIB): Issuer: JADRAN D.D., CRIKVENICA Postal code and location: 51260 CRIKVENICA Street and number: Bana Jelačića 16 E-mail: uprava@jadran-crikvenica.hr Internet address: www.jadran-crikvenica.hr Code and city / municipality 53 CRIKVENICA Code and county 8 PRIMORSKO-GORANSKA Number of employees: (at the end of year) Consolidated Report NO Business activity code: Entities in consolidation (according to IFRS) Registered seat: Tax number (MB): Book-keeping office: Contact person Natali Ivančić Majetić (Name and surname of contact person) Telephone: +385 (0)51 800 482 Telefaks: +385 (0)51 241 349 E-mail: financije@jadran-crikvenica.hr Name and surname: Pero Matić (authorized representatives) Documents to be published: 1. Financial Statements (Balance Sheet, Income statement, Cash Flow Statement, Statement of Changes-in Equity) 2. Management Commentary Statement with notes 3. Responsibility of the Management for the preparation of the financial statements d.d. za hotelijerstvo i turizam	ENCLOSURE 1
				5510
Crikvenica Ureddianave

Balance Sheet as at 31 December 2017

$\overline{2}$ 001 002 003 004 005 006 007	Previous period $\overline{3}$ 591.217.891 309.375 299.990	Current period 4 634.164.151
		196.720
		196.720
008	9.385
009
010	587.361.805	630.420.720
011	298.461.517	298.373.064
012	266.953.640	301.254.714
013	16.066.254	28.279.546
014	304.583	258.176
015
016
017	5.575.811	2.255.220
018
019
020	3.212.240	3.212.240
021
022
023
024
025
026
027	3.212.240	3.212.240
028
029	$\Omega$
030
031
032
033	334.471	334.471
034	8.220.083	6.432.578
035	357.320	461.667
036	344.141	448.206
037
038
039	13.179
040		13.461
041
042
043	2.742.825
044		3.318.441
045
046	1.716.549	870.308
047
	25.181	36.495
		1.172.009
		1.239.629
054
055
056		$\mathbf{0}$
057
058	3.910.692	2.652.470
059	1.021.735	1.831.193
060	600.459.709	642.427.922
	048 049 050 051 052 053	213.530 787.565 1.209.246 1.209.246 061

EQUITY AND LIABILITES
A) EQUITY (063+064+065+071+072+075+078)	062	528.304.162	524.104.027
I. SHARE CAPITAL	063	491.316.690	491.316.690
II. CAPITAL RESERVES	064	25.401.322	25.401.322
III. RESERVES FROM PROFIT (066+067-068+069+070)	065	$\mathbf 0$
1. Legal reserves	066
2. Reserves for treasury shares	067
3. Treasury shares and stakes (less)	068
4. Statutory reserves	069
5. Other reserves	070
IV. REVALUATION RESERVES	071
V. RETAINED EARNINGS (073-074)	072	7.751.533
1. Retained earnings	073		11.586.151
2. Loss brought forward		7.751.533	11.586.151
VI. PROFIT OR LOSS FOR THE FINANCIAL YEAR (076-077)	074
1. Profit for the financial year	075	3.834.617	4.200.136
2. Loss for the financial year	076	3.834.617
VII. MINORITY INTEREST	077		4.200.136
B) PROVISIONS (080 do 082)	078
1. Provisions for redundancy costs	079	839.413	885.032
2. Provisions for tax obligations	080	392.923	438.542
3. Other provisions	081
C) NON-CURRENT LIABILITIES (084 do 092)	082	446.490	446.490
1. Amounts payable to subsidiaries	083	52.538.665	93.486.997
2. Liabilities for loans, deposits and other	084
3. Liabilities towards banks and other financial institutions	085
4. Amounts payable for prepayment	086	43.008.026	84.935.656
5. Trade payables	087
6. Amounts payable for securities	088
	089
7. Liabilities toward participating interests	090
8. Other non-current liabilities 9. Deffered tax	091	9.530.639	8.551.341
	092
D) CURRENT LIABILITIES (094 do 105)	093	14.757.483	22.121.283
1. Amounts payable to subsidiaries	094
2. Liabilities for loans, deposits and other	095	454.000	500.946
3. Liabilities towards banks and other financial institutions	096	2.737.182	4.453.581
4. Amounts payable for prepayment	097	3.092.816	3.675.405
5. Trade payables	098	5.597.262	9.826.410
6. Amounts payable for securities	099
7. Liabilities toward participating interests	100
8. Amounts payable to employees	101	970.188	1.297.399
9. Liabilities for taxes and contributions	102	1.870.596	1.054.740
10. Dividend payables	103
11. Liabilities directly associated with the assets classified as held for sale	104
12. Other current liabilities	105	35.439	1.312.802
E) ACCRUED CHARGES AND DEFERRED REVENUE	106	4.019.986	1.830.583
F) TOTAL EQUITY AND LIABILITIES (062+079+083+093+106)	107	600.459.709	642.427.922
G) OFF-BALANCE SHEET ITEMS	108
ANNEX TO THE BALANCE SHEET (to be filled in by entrepreneur submitting consolidated financial report)
A) CAPITAL AND RESERVES
1. Attributable to equity holders of the parent company's capital
2. Attributable to minority interest	109 110
Note 1.: APPENDIX TO THE BALANCE SHEET (to be filled in by entities who submitting consolidated financial states

IX TO THE BALANCE SHEET (to be filled in by entites who submitting consolidated financial statements).

INCOME STATEMENT
for the period 01 January 2017 to 31 December 2017

ISSUED JADRAN D.D. CRIKVENICA

Item	AOP	Previous period		Current period
		Cumulative	Quarter	Cumulative	Quarter
1 . OPERATING INCOME (112+113)	$\overline{\mathbf{2}}$	$\mathbf{3}$	4	5	6
1. Sales revenue	111	83.584.242	13.474.941	83.691.077	6.938.588
2. Other operating income	112	67.833.349	4.620.396	79.544.559	5.809.695
II. OPERATING EXPENSES (115+116+120+124+125+126+129+130)	113 114	15.750.893 77.809.283	8.854.545 19.954.286	4.146.518 85,193,618	1.128.893
1. Changes in inventories of finished products and work in progress	115				18.740.542
2. Raw material and consumables used (117 do 119)	116	35.848.455	4.723.361	40.199.616	5.964.960
a) Cost of raw materials & consumables	117	18.621.778	1.345.271	20.416.858	2.461.117
b) Cost of goods sold	118	109.316	4.990	102.543	$-688$
c) Other costs	119	17.117.361	3.373.100	19.680.215	3.504.531
3. Staff costs (121 do 123)	120	22.576.409	5.694.127	28.273.270	7.300.775
a) Net salaries	121	14.728.470	3.843.054	18.629.215	5.003.911
b) Employee income tax and contributions	122	4.817.694	1.123.655	5.859.267	1.389.856
c) Employer's contributions	123	3.030.245	727.418	3.784.788	907.008
4. Depreciation and amortisation expense	124	8.109.023	2.507.756	9.527.651	2.970.376
5. Other costs	125	6.598.714	2.377.344	6.286.402	1.663.018
6. Impairment losses (127+128)	126	1.866.449	1.866.449	107.143	107.143
a) non-current assets (except financial assets)	127	1.437.760	1.437.760		$\Omega$
b) current asssets (except financial assets)	128	428.689	428.689	107.143	107.143
7. Provisions	129	978.735	978.735	506.377	506.377
8. Other operating expenses	130	1.831.498	1.806.514	293.159	227.893
III. FINANCIAL INCOME (132 do 136)	131	510.530	240.863	1.387.571	178.346
1. Interest, foreign exhange gains, dividends and other income from related parties	132
2. Interest, foreign exchange gains, dividends and other income from non-related and other entities	133	416.186	160.202	1.306.155	103.390
3. Income from associates and ownership interests	134
4. Unrealized gains 5. Other financial income	135
	136	94.344	80.661	81.416	74.956
IV. FINANCIAL EXPENSES (138 do 141)	137	1.437.407	647.254	4.085.166	1.897.646
1. Interest, foreign exchange losses and other expenses with related parties	138
2. Interest, foreign exchange differences and other expenses with non-related and other entities	139	1.437.407	647.254	4.085.166	1.897.646
3. Unrealized losses
4. Other financial expenses	140
V. SHARE OF INCOME OF ASSOCIATES	141
VI. SHARE OF LOSS OF ASSOCIATES	142
VII. EXTRAORDINARY - OTHER INCOME	143 144
VIII. EXTRAORDINARY - OTHER EXPENSES	145
IX. TOTAL INCOME (111+131+142 + 144)	146	84.094.772
X. TOTAL EXPENSES (114+137+143 + 145)	147	79.246.690	13.715.804 20.601.540	85.078.648	7.116.934
XI. PROFIT OR LOSS BEFORE TAX (146-147)	148	4.848.082	6.885.736	89.278.784	20.638.188
1. Profit before tax (146-147)	149	4.848.082		4.200.136	13.521.254
2. Loss before tax (147-146)	150	0	6.885.736
XII. INCOME TAX EXPENSE	151	1.013.464		4.200.136 $\Omega$	13.521.254
XIII. PROFIT OR LOSS FOR THE PERIOD (148-151)	152	3.834.618	6.885.736	4.200.136	13.521.254
1. Profit for the period (149-151)	153	3.834.618
2. Loss for the period (151-148)	154	0	6.885.736	4.200.136	13.521.254
ANNEX TO THE PROFIT AND LOSS ACCOUNT (to be filled in by entities submitting consolidated financial statements)
XIV. PROFIT OR LOSS FOR THE PERIOD
1. Attributable to owners of the company	155
2. Attributable to non-controlling interests	156
STATEMENTS OF COMPREHENSIVE INCOME (to be filled by entities who work in compliance with IFRS)
I. PROFIT OR LOSS FOR THE PERIOD (= 152)	157
II. OTHER COMPREHENSIVE INCOME /LOSS BEFORE TAX (159 do 165)	158
1. Exchange differences arising from foreign operations	159
2. Revaluation of non-current assets and intangible assets	160
3. Gains or loss available for sale investments	161
4. Gains or loss on net movement on cash flow hedges	162
5. Gains or loss on net investments hedge	163
6. Share of the other comprehensive income/loss of associates	164
7. Acturial gain / loss on post employment benefit obligations	165
II. TAX ON OTHER COMPREHENSIVE INCOME OF THE PERIOD	166
V. NET OTHER COMPREHENSIVE INCOME OR LOSS FOR THE YEAR (158-166)	167
. TOTAL COMPREHENSIVE INCOME/LOSS FOR THE PERIOD (157+167)	168
APPENDIX Statement of Comprehensive Income (to be filled in by entities submitting consolidated financial statements)
/I. TOTAL COMPREHENSIVE INCOME/LOSS FOR THE PERIOD
1. Attributable to owners of the company	169
2. Attributable to non-controlling interests	170

CASH FLOW STATEMENT - Indirect method in the period 01 January 2017 to 31 December 2017

Issuer: JADRAN D.D., CRIKVENICA
Item	AOP	Previous period	Current period
	$\overline{2}$	3	4
CASH FLOW FROM OPERATING ACTIVITIES
1. Profit before tax	001	4.848.082	$-4.200.136$
2. Depreciation and amortisation	002	8.109.023	9.527.651
3. Increase in liabilities	003	10.045.976	2.299.796
4. Decrease in receivables	004	n
5. Decrease in inventories	005
6. Other increase in cash flow	006		45.619
I. Total increase in operating cash flow (001 do 006)	007	23.003.081	7.672.930
1. Decrease in liabilities	008
2. Increase in receivables	009	246.205	226.872
3. Increase in inventories	010	60.265	104.347
4. Other decrease in cash flow	011	23.928.363	1.044.984
II. Total decrease in operating cash flow (008 do 011)	012	24.234.833	1.376.203
A1) NET INCREASE IN OPERATING CASH FLOW
$(007 - 012)$	013		6.296.727
A2) NET DECREASE IN OPERATING CASH FLOW	014	1.231.752
$(012 - 007)$
CASH FLOW FROM INVESTMENT ACTIVITIES
1. Proceeds from sale of property, plant and equipment	015
2. Net disposal of financial assets	016
3. Interest received	017	510.530	35.578
4. Dividend received	018
5. Other cash from investing activities	019	5.776.822	1.209.246
III. Total cash flow from investing activities (015 do 019)	020	6.287.352	1.244.824
1. Purchase of property, plant and equipment and intangible assets	021	30.084.555	52.443.803
2. Purchase of financial instruments	022
3. Other cash flow used in investing activites	023	3.116.102
IV. Total cash flow from investing activities (021 do 023)	024	33.200.657	52.443.803
B1) NET INCREASE IN CASH FLOW FROM INVESTING ACTIVITIES	025
$(020 - 024)$ B2) NET DECREASE IN CASH FLOW FROM INVESTING ACTIVITIES
$(024 - 020)$	026	26.913.305	51.198.979
CASH FLOW FROM FINANCIAL ACTIVITIES
1. Proceeds from issuance of financial instruments	027
2. Proceeds from loans	028
3. Other cash flow from financial activities	029	29.726.078 1.033.828	41.927.630
V. Total cash flow from financial activities (027 do 029)		30.759.906	1.716.399
1. Repayment of interest-bearing borrowings	030		43.644.029
2. Dividend paid	031
3. Repayment of finance lease	032
4. Repurchase of treasury shares	033
5. Other cash flow used in financial activities	034
VI. Total cash flow used in financial activities (031 do 035)	035
C1) NET INCREASE IN CASH FLOW FROM FINANCIAL ACTIVITIES	036
$(030 - 036)$	037	30.759.906	43.644.029
C2) NET DECREASE IN CASH FLOW FROM FINANCIAL ACTIVITIES	038
$(036 - 030)$ Total increase in cash flow (013 - 014 + 025 - 026 + 037 - 038)
	039	2.614.849
Total decrease in cash flow (014 - 013 + 026 - 025 + 038 - 037) Cash and cash equivalents at the beginning of the period	040		1.258.223
Increase in cash and cash equivalents	041	1.295.844	3.910.692
Decrease in cash and cash equivalents	042	2.614.848
	043		1.258.223
Cash and cash equivalents at the end of the period	044	3.910.692	2.652.469

STATEMENT OF CHANGES IN EQUITY
for the period from 1.1.2017

71.127.71.1 $\overline{5}$ 11 D77:1:1
Item	AOP	Previous	Current period
٣		period
	2	S	4
1. Share capital	PO0	491.316.690	491.316.690
2. Capital reserves	002	25.401.322	25.401.322
3. Reserves from profit	003
4. Retained earnings
5. Profit or loss for the period	004	7.751.533	11.586.151
and equipment 6. Revaluation of property, plant	005	3.834.617	4.200.136
7. Revaluation of intangible assets	006
	007
8. Revaluation of financial financial assets available for sale	008
9. Other revaluations	009
AOP 001 do 009) 10. Total capital and reserves	010
11. Foreign exchange differences from investments in foreign operations		528.304.162	524.104.027
12. Current and deferred taxes	P.LO		$\overline{\circ}$
13. Cash flow hedge	012
14. Changes in accounting policies	013
15. Prior year adjustment	014
16. Other changes in equity	015
17. Total increase/decrease in	016
equity (AOP 011 do 016)	017	$\circ$	$\circ$
17 a. Parent company share in subsidiary	018	$\circ$	$\circ$
17 b. Minority interest
	019
tive sinn Items that decrease equity have neg-

I uerns una decrease equity have negative sign
Items from 001 to 009 are state of balance sheet date

Notes to the Financial Statements

Other notes to the financial statements are disclosed within the Management report.

Pursuant to the provisions of the Capital Market Act, Article 407, Paragraph 2, and Article 410, Paragraph 2, the Company Management Board makes the following statement:

STATEMENT OF RESPONSIBILITIES OF THE COMPANY MANAGEMENT BOARD

According to our best knowledge, the quarterly financial report of Jadran d.d., as of 31.12.2017. is composed in accordance with the Accounting Law, with the application of International Financial Reporting Standards.

The report provides a true account of the Company's assets and liabilities, profit and losses, financial position and operation, but as it made up of temporary data, it may deviate from the Company's 2017 annual report.

In Crikvenica, 27.02.2018.

Management Board President

Pero Matić

Management Board Member

Jadran d.d. za hotelijerstvo i turizam, Bana Jelačića 16, HR-51260 Crikvenica | www.jadran-crikvenica.hr

Uprava: $T: +385(0)51241222$ F: +385 (0)51 241 632 E: uprava@jadran-crikvenica.hr

Marketing: $T: +385(0)51241970$ $F: +385(0)51241975$ E: marketing@jadran-crikvenica.hr

OIB: 56994999963 Privredna banka d.d. 2340009-1110722690 IBAN: HR4323400091110722690 SWIFT: PBZGHR2X

Temeljni kapital iznosi 491.316.690,00 kn uplaćen u cijelosti podijeljen na 49.131.669 redovnih dionica nominalnog iznosa 10,00 kuna svaka. Društvo je upisano u Sudski registar Trgovačkog suda u
Rijeci pri Trgovačkom sudu $\overline{o}$ ec