KSG Agro S.A.

Quarterly Report • Nov 12, 2020

INTERIM REPORT

January - September 2020

Societe Anonyme 24, rue Astrid L-1143 Luxembourg R.C.S. В 156.864

UNAUDITED INTERIM CONDENSED CONSOLIDA TED FINANCIAL ST А TEMENTS FOR ТНЕ NINE MONTHS ENDED 30 SEPTEMBER 2020

TABLE OF CONTENTS

Interim Management Report

Principal Activities	1
Strategy Implementation	1
Impact of the Coronavirus COVID-19	2
Financial and Operational Results	2
Subsequent Events	3
Business and Financial Risks	3
Corporate Govemance	5
Statement of the Board of Directors and management's responsibility for the preparation and approval of the interim condensed consolidated financial statements	9
Unaudited Interim Condensed Consolidated Financial Statements
Unaudited Interim Condensed Consolidated Statement of Financial Position	10
Unaudited Interim Condensed Consolidated Statement of Profit or Loss	11
Unaudited Interim Condensed Consolidated Statement of Other Comprehensive Income	12
Unaudited Interim Condensed Consolidated Statement of Cash Flows	13-14
Unaudited Interim Condensed Consolidated Statement of Changes in Equity	15

Notes to the Unaudited Interim Condensed Consolidated Financial Statements

16-24

PRINCIPAL ACTIVITIES

KSG Agro S.A., separately referred to as "KSG Agro" ог the "Company" and together with its subsidiaries referred to as the "Group", remains among the largest vertically integrated agricultural groups in the Dnipropetrovsk region of Ukraine, present in al/ major sectors of the agricultural market, including production, storage, processing and sale of agricultural products. lts key operating activities аге breeding of pigs, processing of pork and production of wheat and sunflower.

STRATEGY IMPLEMENTATION

Below are the highlights of how the Group has implemented its development strategy in 2020:

Strategy lmplementation

Focus оп pigs breeding and increase its efficiency

Total revenues from pigs breeding and meat processing for the nine months ended 30 September 2020 were USD 7.4 million. Total revenues from pigs breeding and meat processing for the nine months ended 30 September 2019 were at а соmрагаЫе level of USD 7.8 million

The Group's pig complex continues to function as previously, despite the complications of the coronavirus outbreak. AII necessary security measures and guidelines аге being adhered to, with personnel screenings and disinfection activities being performed

Total sales of pigs for the nine months ended 30 September 2020 wеге 80 thousand heads and total farrow was 88 thousand heads

The construction of an additional fattening shop for 2,340 heads and an additional sow house for 360 sows, planned to Ье completed Ьу the end of 2020, will provide the Group with another production facility for fattening pigs and wi/1 provide ап opportunity to increase the Ьirth rate of piglets and improve their performance even more.

lncrease the efficiency of land farming, search for new contracts and alternative revenue sources

The total агеа of agricultural land controlled Ьу the Group as at 30 September 2020 was 21 thousand hectares, ofwhich 11 thousand hectares were under harvesting of summer crops and 1 О thousand hectares were under sowing of winter crops

Total revenue from crops fог the nine months ended 30 September 2020 was USD 6.9 million. As an altemative revenue source, the Group has used its agricultural equipment and expertise to render land cultivation and similar /and preparation services to other сгор producers for а total amount of ап additional USD 2.2 million

The Group's spring sowing campaign has started in early April, and the Group's harvesting campaign for winter crops started in late June; both as planned and largely unaffected Ьу the coronavirus outbreak

The yield of wheat and barley in 2020, compared to 2019, increased Ьу 7% and 48%, respectively - from 30.4 c/ha to 32.5 c/ha and from 28 c/ha to 41.4 c/ha; and the yield of rapeseed increased Ьу 52% - from 11 c/ha to 16.7 c/ha

As at the date of this report, the Group has also successfully completed the sowing campaign for winter crops

Reduce current debl and extend the credit period As of 4 August 2020, the Group has fully repaid its loan from LBBW, fixing the total amount of its bank and other loans at USD 29.3 million, the current portion of which being only USD 4.4 million. This was the Group's last overdue loan

Management are now focused оп the further restructuring and repayment of trade and other рауаЫеs, due to the Group currently having а negative net current assets position, and trade and other рауаЫеs comprise 75% of total current liaЬilities as at 30 September 2020

The Group has managed to increase its net current assets from а negative USD 23.5 million as at 31 December 2019 to а negative USD 6.3 million as at 30 September 2020 and, going further, management аге committed to continue improving Group's liquidity and to bring net current assets to а positive value within the next several months

IMPACT OF ТНЕ CORONAVIRUS COVID-19

The Board of Directors of the Company does not currently provide for the significant adverse effects of the coronavirus COVID-19 epidemic on the Group's financial results in 2020.

The Group is resistant to fluctuations in exchange rates because, at the moment, settlements in foreign currency do not constitute а significant share in the total cost structure. During 2019, the Group restructured most of its dеЫ in foreign currency, while freeing up reserves in the amount of more than USD 1 О million. Although а sharp increase in the exchange rates of Ukrainian Hryvnya against the US Dollar during March of 2020 resulted in recognition of significant forex losses, these losses аге non-operating losses, primarily оп revaluation of the Group's long-term loans, and therefore, аге not expected to have an effect оп the Group's operating results in the long-term, especially when the virus situation is resolved and the exchange rates return back to nonnal.

ln addition, in order to minimise external risks, starting in 2014, the Group implemented the program to build а vertically integrated structure, а closed production cycle and reduce production costs. The Group focuses on pork production and its main market is the domestic market of Ukraine, where over the past months there has been an increase in both price and demand for pork. ln addition, ргоЫеms in international trade have led to Ыocking of the competitive products import. AII this leads to an increase in the Group's sales and profit margins.

· Despite this, the Board of Directors provides regular monitoring of the situation related to the consequences of the spread of the coronavirus COVID-19 and the impact of the epidemic оп the Group's activities. Caring for the health and safety of employees, the Group took а number of measures to prevent the spread of COVID-19 at the Group's offices. Screening for staff temperature and disinfection activities are being carried out. Also, business trips and relocation of employees were reduced to the required minimum.

The Group will continue to provide infonnation on adverse effects, if any, of the impact of COVID-19 on its activities through notices on the Warsaw Stock Exchange and on its website.

FINANCIAL AND OPERATIONAL RESULTS

The following tаЫе sets forth the Group's results of operations for the nine months ended 30 September 2020 and 2019 derived from the unaudited interim condensed consolidated financial statements:

	Nine months	Nine months Change, %
/п thousands of US dollars	2020 (unaudited)	2019 (unaudited)
Revenue	14,666	17,757	(17)%
Net change in fair value of blological assets and agricultural produce	5,961	5,684	5%
Cost of sales	(13,861)	(21,578)	(36)%
Gross EГOfit	6,766	1,863	263%
Selling, general and administrative expenses	(1,211)	(1,076)	13%
Other OEerating income	8,057	1,754	359%
OEerating EГofit	13,612	2!541	436%
Other expenses	(4,367)	(3,517)	24%
Finance income	1,540	11,070	(86)%
Finance expenses	(1,511)	(1,285)	18%
Gain/(loss) оп foreign currency exchange, net	(1,897)	1,888	(200)%
Gain/(loss) оп disEosal of subsidiaries	(2,610)	(685)	281%
Profit before tax	4,767	10!012	(52)%
lncome !ах exEense		3) (	(100)%
Profit for the period	4,767	10,009	(52)%
Operating profit	13,612	2,541	436%
DeEreciation and amortisation of non-current assets	1,100	1,375	(20)%
EBITDA	14,712	3 916	276%

Revenue and cost of sales аге both lower Ьу 17% and 36%, respectively, and primarily in the сгор production segment, which is more affected Ьу seasonality and weather conditions.

Total revenue from crop production for the nine months ended 30 September 2020 was USD 6.9 million as compared to USD 9.7 million for the nine months ended 30 September 2019. Net change in the fair value of crops was USD 4.9 million for the nine months ended 30 September 2020 and 2.6 million for the nine months ended 30 September 2019.

As an alternative revenue source to hedge against the unpredictaЬility of weather conditions, the Group has used its agricultural equipment and expertise to render land cultivation and similar land preparation services to other crop producers for а total amount of USD 2.2 million for the nine months ended 30 September 2020 as compared to USD 1.9 million for the nine months ended 30 September 2019. These revenues were previously presented as part of the 'other operations' segment.

Despite the lower output of the crop production segment, the Group managed to increase the margins in both of its main segments. Segment profits for the nine months ended 30 September 2020 from crops and pigs were, respectively, USD 6.8 million and USD 0.4 million as compared to, respectively, USD 2.5 million and USD -0.3 million for the nine months ended 30 September 2019.

Accordingly, overall cost of sales is lower Ьу 36% being USD 13.9 million for the nine months ended 30 September 2020 from USD 21.6 million for the nine months ended 30 September 2019. And this trend of the relative decrease in cost of sales towards revenue is expected to continue. Main contributing factors are that the Group continues to use its own selfproduced feeds instead of purchasing them, as well the commissioning of the upgraded manure separation station at the pig complex in July 2019, which helps the Group save on energy costs.

As а consequence, the Group's EBITDA for the nine months ended 30 September 2020 increased Ьу 276% to USD 14.7 million from USD 3.9 million for the nine months ended 30 September 2019.

Going further, the construction of an additional fattening shop for 2,340 heads and an additional sow house for 360 sows, planned to Ье completed later in 2020, will provide the Group with another production facility for fattening pigs and will provide an opportunity to increase the blrth rate of piglets and improve their performance even more.

Details Ьу segment are disclosed in Note 14 to the consolidated financial statements.

SUBSEQUENT EVENTS

As at the date of this report, the Group has successfully completed the sowing campaign for winter crops. There were по other material subsequent events.

BUSINESS AND FINANCIAL RISKS

Credit risk

The Group takes on exposure to credit risk, which is the risk that one party to а financial instrument will cause а financial loss for the other party Ьу failing to discharge an oЬligation. Exposure to credit risk arises as а result of the Group's sales of products on credit terms and other transactions with counterparties giving rise to financial assets.

Credit risk concentration

The Group is exposed to the concentration of credit risk. Management monitors and discloses concentrations of credit risk Ьу oЬtaining monthly reports with exposures to counterparties with individually material balances.

As at 30 September 2020, the Group had 7 counterparties (31 December 2019: 8 counterparties} with aggregate receivaЫe balances above USD 150 thousand each. The total amount of these balances as at 30 September 2020 was USD 2,744 thousand (31 December 2019: USD 3,410 thousand} or 79% (31 December 2019: 47%} of financial accounts receivaЬle.

Market risk

The Group takes an exposure to market risks. Market risks arise from open positions in (а} foreign currencies, (Ь) interest bearing assets and liabllities, all of which are exposed to general and specific market movements. The Group does not have significant interest-bearing financial assets. Loans and borrowings issued at variaЫe interest rates expose the Group to the interest rate risk. Loans and borrowings issued at fixed rates expose the Group to the fair value risk.

KSG Agro S.A. Management Report for the nine months ended 30 September 2020

The sensitivities to market risks disclosed below are based on a change in one factor while holding all other factors constant. In practice this is unlikely to occur and changes in some of the factors may be correlated - for example, changes in interest rate and changes in foreign currency rates.

Interest rate risk

Risk of changes in interest rate is generally related to interest-bearing loans. Loans issued at variable rates expose the Group to cash flow interest rate risk. Loans issued at fixed rates expose the Group to fair value interest rate risk. The Group is currently developing its policy of fixed and variable rates loan portfolio. The Group's management analyses market interest rates to minimize interest rate risk.

Currency risk

Foreign exchange risk arises when future commercial transactions or recognized assets or liabilities are denominated in a currency that is not the entity's functional currency.

Liquidity risk

Liquidity risk is the risk that an entity will encounter difficulty in meeting obligations associated with financial liabilities. Liquidity risk is managed by monthly rolling forecasts of the Group's cash flows. The Group seeks to maintain a stable funding base primarily with bans, and trade and other payables. Key liquidity indicators are as follows:

	30 September 2020
In thousands of US dollars	(unaudited)	31 December 2019
Total current assets	25,204	20,407
Total current liabilities	(31,517)	(43,893)
Net Current Assets	(6,313)	(23,486)
Currant Accate to Currant I ishilitiac Patio	0 80	0 46

Management recognises that such low liquidity indicators in the past were, to a considerable extent, a result of unpaid and overdue loans, which, at the date these financial statements are being issued, have been fully repaid.

Management are now focused on the further restructuring and repayment of trade and other payables, which comprise 75% of total current liabilities as at 30 September 2020. Management are committed to improve Group's liquidity and to bring net current assets to a positive value within the next several months.

Capital Risk Management

The Group's objectives when managing capital are to safeguard the Group's ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders as well as to provide financing of its operating requirements, capital expenditures and Group's development strategy. The Group's capital management policies aim to ensure and maintain an optimal capital structure to reduce the overall and flexibility relating to Group's access to capital markets.

In thousands of US dollars	30 September 2020 (unaudited)	31 December 2019
Bank and other loans	29,300	29,260
Promissory notes issued	1.998	1.990
Less: cash and cash equivalents	(187)	(299)
Net debt	31,111	30,951
Total equity	12,882	11,322
Net Debt to Equity Ratio	2.42	2.73

The Group is currently developing its capital management monitors on a regular basis the Group's capital structure and may adjust its capital management policies and targets following changes of its operating environment, market sentiment or its development strategy.

Management believes it is responding appropriately to all the risks identified in order to support the sustainability of the Group's business in the current circumstances.

CORPORATE GOVERNANCE

The Board of Directors (the "Board") observes the majority of Warsaw Stock Exchange corporate governance rules included in the "Code of Best Practice for WSE Listed Companies" in the form and to the extent determined Ьу the Resolution No. 19/1307/2012 of the Exchange Supervisory Board dated 21 November 2012. Code of Best Practice for WSE Listed Companies is availaЫe at the official website of the Warsaw Stock Exchange

The Board of Directors consists of five members, three of each hold an executive role (Directors А), and two directors are поп executive ones (Directors В)

Мг. Sergiy Kasianov, Chairman of the Board of Directors, has а significant indirect holding of securities in the Company. No other person has а significant direct or indirect holding of securities in the Company. No person has any special rights of control over the Company's share capital.

There аге по restrictions оп voting rights.

Appointment and replacement of Directors and amendments to the Articles of Association

With regard !о the appointment and replacement of Directors, its Articles of Association (hereinafter referred to as the "Articles of Association") and Luxembourg Law comprising the Companies Law 1915 govern the Company. А general meeting of the shareholders under the quorum may amend the Articles of Association from time to time and majority requirement provided fог Ьу the Law of 1 О August 1915 Оп Commercial Companies in Luxembourg, as amended.

Powers of Directors

The Board is responsiЬle for managing the business affairs of the Company within the clauses of the Articles of Association. The Directors may only act at duly convened meetings of the Board of Directors or Ьу written consent in accordance with article 9 of Articles of Association.

Rights of the shareholders

Articles of Association and national laws and regulation govern the operation of the shareholders meetings and their key powers, description of their rights.

Transfer of shares

Transfer of shares is governed Ьу Articles of Association of the Company.

Meetings of the board

ln this regard the Company is governed Ьу Article 9 of the Articles of Association.

Мг. Sergiy Kasianov has Ьееп appointed as Chairman of the Воагd of Directors.

The Board of Directors shall meet upon call Ьу the Chairman, or апу two Directors at the place and time indicated in the notice of meeting, the person(s) convening the meeting setting the agenda.

Written notice of апу meeting of the Board of Directors shall Ье given to all Directors at least five (5) calendar days in advance of the hour set for such meeting, except in circumstances of emergency where 24 hours prior notice shall suffice which shall duly set out the reason fог the urgency.

The Ьоагd of Directors may act validly and validly adopt resolutions if approved Ьу the majority of Directors including at least one class А and опе class В Director at least а majority of the Directors are present or represented at а meeting.

Audit Commlttee

The audit committee is composed of three members and is in charge of overseeing financial reporting and disclosure.

Internal Control

The Company's management is responsible for establishing adequate controls over financial reporting process for KSG Agro S.A., which include the appropriate level of Directors' involvement.

KSG Agro S.A. maintains an effective internal control structure. It consists, in particular, of organizational arrangements with clearly defined lines of responsibility and delegation of authority, and comprehensive systems and control procedures. An important element of the control environment is an ongoing internal audit program. KSG Agro S.A. system also contains monitoring mechanisms, and actions taken to correct deficiencies if they identified.

To assure the effective administration of internal controls, KSG Agro S.A. carefully selects employees, develops and disseminates oral and written policies and procedures, provides appropriate communication channels and fosters an environment conducive to the effective functioning of controls.

The Company's internal control over financial reporting includes those policies and procedures that:

• · pertain to the maintenance of records that, in reasonable detaily reflect the transactions and dispositions of the assets of the Company;
• · provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with Ukrainian generaly adopted accounting principles and transformation to International Financial Reporting Standards as adopted by European Union;
• · that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company;
• · provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company's assets that could have a material effect on the financial statements.

We believe that it is essential for the Company to conduct its business affairs in accordance with the highest ethical standards, as set forth in KSG Agro S.A.

Information With Respect To Article 11 Of The Law Of 19 May 2006 On Takeover Bids

Article 11 a) the structure of their capital, including securities which are not admitted to trading on a regulated market in a Member State, where appropriate with an indication of the different classes of shares and, for each class of shares, the rights and obligations attaching to it and the percentage of total share capital that it represents.

According to article 5.1 of the articles of association of the Articles), the Company's subscribed share capital amounts to one hundred fifty thousand two hundred United States Dollars (USD 150,200.00) represented by fifteen million twenty thousand (15,020,000) shares having a nominal value of one Cent (USD 0.01) each.

All the issued share capital of the Company is admitted to listing and trading on the main market of the Warsaw Stock Exchange.

On May 23, 2013 The Company bought back thirty-two thousand one hundred and seventy-two (32,172) own shares, representing 0.21% of share capital, that are accounted for as treasury shares.

Article 11 b) any restrictions on the transfer of securities, such as limitations on the holding of securities or the need to obtain the approval of the company or other holders of securities, without prejudice to article 46 of Directive 2001/34/EC.

The shares of the Company are transferred in accordance with customary procedures for the transfer of securities in Book-entry form.

Furthermore, there is no restriction with the transfer of securities pursuant to article 7.5 of the Articles. The sole requirement is that any transfer shall be recorded in the register of shares of the Company.

KSG Agro S.A. Management Report for the nine months ended 30 September 2020

ln accordance with article 7.1 О of the Articles, any shareholder, company ог individual, who acquires ог sells shares, including certificates representing shares of the Company, shall notify to the Company the percentage of the voting rights he/she/it will own pursuant to such acquisition ог sale, in case such percentage reaches the thresholds of 5%, 10%, 15%, 20%, 33 1/3%, 50% and 66 2/3% ог supersedes ог falls under such thresholds. The shareholders shall also notify the Company should the percentage of their respective voting rights reach the above mentioned thresholds ог supersede them or fall under such thresholds pursuant to certain events amending the voting rights repartition of the Company.

Those notification requirements apply also to certain situations as listed Ьу article 9 of the law of 11 January 2008 on transparency oЬligations with respect to the information of companies which securities аге listed оп а regulated market.

Article 11 с) significant direct and indirect shareholdings (including indirect shareholdings through pyramid structures and cross-shareholdings) within the meaning of Directive 2004/109/ЕС.

The main shareholder of the Company as at 31 December 2019 is:

• OLBIS lnvestments L TD S.A. holds nine million seven hundred and five thousand five hundred (9,705,500) shares, representing 64.62% of the issued share capital of the Company.

• KSG Agro S.A holds thirty-two thousand one hundred seventy-two (32,172) shares, representing 0.21 % of the issued share capital of the Company.

• ln free float there аге five million two hundred and eighty-two thousand three hundred twenty-eight (5,282,328) shares, representing 35.17% of the issued share capital of the Company.

Article 11 d) the holders of any securities with special control rights and а description of those rights.

There аге по special control rights.

Article 11 е) the system of controJ of any employee share scheme where the control rights are not exercised directly Ьу the employees.

There is no employee share scheme.

Article 11 f) any restrictions on voting rights, such as limitations of the voting rights of holders of а given percentage or number of votes, deadlines for exercising voting rights, or systems whereby, with the company's cooperation, the financial rights attaching to securlties are separated from the holding of securities.

Pursuant to article 7.1 О of the Articles, if а shareholder breaches the thresholds mentioned in point Ь) and fails to notify the Company within the period of four ( 4) listing days, as stated therein, the exercise of voting rights attached to the new participation exceeding the relevant threshold will Ье suspended.

Article 11 g) any agreements between shareholders which are known to the company and may result in restrictions on the transfer of securities or voting rights within the meaning of Directive 2004/109/ЕС.

То the best of our knowledge there аге по such agreements.

Article 11 h) the rules governing the appointment and replacement of board members and the amendment of the articles of association.

Pursuant to article 8 of the Articles, the directors of the Company (the Directors ог the Board, as applicaЬle) аге to Ье appointed Ьу the general meeting of the shareholders of the Company (the General Meeting) for а period not exceeding six (6) years and until their successors аге elected. Moreover, the decision to suspend ог dismiss а Director must Ье adopted Ьу the General Meeting with а majority of mоге than one-half (1/2) of all voting rights present ог represented. When а legal person is appointed as Director, the legal entity must designate а permanent representative (representant permanent) in accordance with article 51Ьis of the Law of 10 August 1915 Оп Commercial Companies, as amended (the Company Law).

ln accordance with article 20 of the Articles, the Articles may Ье amended from time to time Ьу а General Meeting under the quorum and majority requirements provided for Ьу the Company Law.

Article 11 i) the powers of board members, and in particular the power to issue or buy back shares.

With respect to the acquisition of own shares, article 6 of the Articles estaЬlishes that the Company may acquire its own Shares to the extent permitted Ьу law. То the extent permitted Ьу LuxemЬourg law, the Board is irrevocaЬly authorized and empowered to take any and all steps to execute any and all documents to do and perform any and all acts for and in the name and оп behalf of the Company which may Ье necessary ог advisaЫe in order to effectuate the acquisition of the shares and the accomplishment and completion of all related actions.

According to article 11.2 of the Articles, the Board is vested with the broadest powers to perform all acts of administration and disposition in the Company's interests and within the objectives and purposes of the Company. AII powers not expressly reserved Ьу law ог Ьу the Articles to the General Meeting fall within the competence of the Board.

Article 11 j) any significant agreements to which the company is а party and which take effect, alter or terminate upon а change of control of the company following а takeover Ыd, and the effects thereof, except where their nature is such that their disclosure would Ье seriously prejudicial to the company; this exception shall not apply where the company is specifically oЫiged to disclose such information on the basis of other legal requirements.

То the extent of our knowledge there аге по such agreements.

Article 11 k) any agreements between the company and its board members or employees providing for compensation if they resign or are made redundant without valid reason or if their employment ceases because of а takeover Ыd.

То the extent of our knowledge there аге по such agreements.

This management report for the nine months ended 30 September 2020 was approved for issue оп 1 О November 2020.

A.V. Skorokhod Y.V. Kyselova

- I

(Chief Executive Officer) (Chief Financial Officer)

Statement of the Board of Directors and management's responsibility for the preparation and approval of the interim condensed consolidated financial statements

The following statement is made with a view to clarify responsibilities of management and Board of Directors in relation to the interim condensed consolidated financial statements of KSG AGRO S.A. and its subsidiaries (further - the Group).

The Board of Directors and the Group's management are responsible for the interim condensed consolidated financial statements of the Group as of 30 September 2020 and for the nine months then ended in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union.

In preparing the interim condensed consolidated financial statements, the Board of Directors and management are responsible for:

• · Selecting suitable accounting principles and applying them consistently;
• · Making reasonable assumptions and estimates;
• · Compliance with relevant IFRSs and disclosure of all material departures in the interim condensed consolidated financial statements:
• Compliance with ESMA Guidelines .
• · Preparing the interim condensed consolidated financial statements on a going concern basis, unless it is inappropriate to presume that the Group will continue in business for the foreseeable future.

The Board of Directors and management are also responsible for:

• · Designing, implementing and maintaining an effective and sound system of internal controls, throughout the Group;
• · Maintaining proper accounting records that disclose, with reasonable accuracy at any time, the consolidated financial position of the Group, and which enable them to ensure that the interim condensed consolidated financial statements of the Group comply with IFRS as adopted by the European Union;
• · Taking such steps as are reasonably available to them to safeguard the assets of the Group; and
• · Preventing and detecting fraud and other irregularities.

In accordance with Article 4 (2) (c) of the Law of Luxembourg of 11 January 2008 on the harmonisation of transparency requirements in relation to information about issuers whose securities are admitted to trading on a regulated market, we declare that, to the best of our knowledge, the interim condensed consolidated financial statements for the nine months ended 30 September 2020, prepared in accordance with IAS 34 "Interim Financial Reporting" as adopted by the European Union, give a true and fair view of the assets, liabilities, financial position and profit or loss of KSG Agro S.A. and its subsidiaries included in the consolidation taken as a whole. In addition, the management report includes a fair review of the development and performance of the business and the position of KSG Agro S.A. and its subsidiaries included in the consolidation taken as a whole, together with a description of the principal risks and uncertainties that they face.

These interim condensed consolicated financial statements as of 30 September 2020 and for the nine months then ended were approved for issue on 10 November 2020.

A V Skorokhod (Chief Executive Officer)

Y.V. Kvselova (Chief Financial Officer)

Unaudited Interim Condensed Consolidated Statement of Financial Position

as at 30 September 2020

		30 September	31 December
In thousands of US dollars	Note	2020 (unaudited)	2019
ASSETS
Non-current assets
Property, plant and equipment	7	17,163	19,559
Long-term biological assets	9	27,787	33,194
Deferred tax assets		198	236
Right-of-use assets	8	784	1,298
Total non-current assets		45,932	54,287
Current assets
Current biological assets	9	9,458	6,066
Inventories and agricultural produce	10	10,443	8,420
Trade and other accounts receivable	11	3.789	5,322
Taxes recoverable and prepaid		1,327	300
Cash and cash equivalents		187	299
Total current assets		25,204	20,407
TOTAL ASSETS		71,136	74,694
EQUITTY
Share capital		150	150
Share premium		37,366	37,366
Treasury shares		(112)	(112)
Retained earnings		(31,869)	(37,901)
Currency translation reserve		(4,175)	(3,877)
Equity attributable to the owners of the Company		1,360	(4,374)
Non-controlling interests		11,522	15,696
TOTAL EQUITY		12,882	11,322
LIABILITIES
Non-current liabilities
Bank and other loans	13	24,815	17,475
Lease liabilities	8	1,922	2,004
Total non-current liabilities		26,737	19,479
Current liabilities
Trade and other accounts payable	12	23,694	29,290
Bank and other loans	13	4,485	11,785
Lease liabilities	8	1,226	738
Promissory notes issued		1,998	1,990
Taxes payable		114	90
Total current liabilities		31,517	43,893
TOTAL LIABILITIES		58,254	63,372
TOTAL LIABILITIES AND EQUITY		71,136	74,694

Approved for issue and signed on behalf of the Board of Directors on 10 November 2020.

A.V. Skorokhod (Chief Executive Officer)

Y.V. Kyselova (Chief Financial Officer)

The accompanying notes are an integral part of these consolidated financial statements

Unaudited lnterim Condensed Consolidated Statement of Profit or Loss

for the nine months ended 30 September 2020

		Nine months	Nine months
ln thousands of US dollars	Note	2020 (unaudited)	2019 (unaudited)
Revenue	14	14,666	17,757
Net change in fair value of Ьiological assets and agricultural produce	14	5,961	5,684
Cost of sales	14	(13,861)	(21,578)
Gross profit		6,766	1,863
		(1,211)
Selling, general and administrative expenses	15	8,057	(1,076)
Other operating income Operating profit		13,612	1,754 2,541
Other expenses	16	(4,367)	(3,517)
Finance income	17	1,540	11,070
Finance expenses	17	(1,511)	(1,285)
Foreign currency exchange gain/()oss), net	18	(1,897)	1,888
Gain/(loss) оп reorganisation and disposal of subsidiaries		(2,610)	(685)
Profit before tax		4,767	10 012
lncome tax expense
Profit for the period		4,767	{3) 10, 009
Profit attributaЫe to:
Owners of the Company		6,032	9,670
Non-controlling interest		(1,265)	339
Profit for the period		4,767	10, 009
Earnings per share
Weighted-average number of common shares outstanding		15,020,000	15,020,000
Basic and diluted eamings рег share, USD		0.40	0.64

Approved for issue and signed оп behalf of the Board of Directors on 1 О November 2020.

A.V. Skorokhod

(Chief Executive Officer) (Chief Financial Officer)

Unaudited Interim Condensed Consolidated Statement of Other Comprehensive Income

for the nine months ended 30 September 2020

	Nine months	Nine months
In thousands of US dollars	2020 (unaudited)	2019 (unaudited)
Profit for the period	4,767	10,009
Other comprehensive income/(loss), net of income tax
Currency translation differences	(3,207)	464
Total comprehensive income/(loss) for the period	1,560	10,473
Total comprehensive income/(loss) attributable to:
Owners of the Company	5,734	10.407
Non-controlling interests	(4,174)	66
Total comprehensive income/(loss) for the period	1,560	10,473

Approved for issue and signed on behalf of the Board of Directors on 10 November 2020.

A.V. Skorokhod (Chief Executive Officer)

Y.V. Kyselová (Chief Financial Officer)

The accompanying notes are an integral part of these consolidated financial statements

Unaudited Interim Condensed Consolidated Statement of Cash Flows

for the nine months ended 30 September 2020

		Nine months	Nine months
In thousands of US dollars	Note	2020 (unaudited)	2019 (unaudited)
Cash flow from operating activities
Profit before tax		4,767	10,012
Adjustments for:
Depreciation and amortisation	7,8	1,100	978
Net change in fair value of biological assets and agricultural produce	9	(5,961)	(5,684)
Impairment and write-off of inventory	16	658	59
Impairment and write-off of VAT and accounts receivable	16	3,619	2,783
Write-off of accounts payable		(8,047)	(1,743)
Finance income	17	(1,540)	(11,070)
Finance expenses	17	1,511	1,285
Exchange differences		3,912	(1,888)
(Gain)/loss on reorganisation and disposal of subsidiaries		2,610	685
Operating cash flow before working capital changes		2,629	(4,583)
Change in trade and other accounts receivable		(2,678)	(3,303)
Change in biological assets		(3,536)	(2,095)
Change in inventories and agricultural produce		1,635	(3,198)
Change in taxes receivable and payable		(1,194)	(617)
Change in trade and other accounts payable		3,703	15,557
Cash generated from operations		559	1,761
Interest paid on loans and leases	8, 13	(997)	(536)
Income tax paid		(13)	(4)
Cash generated from / (used in) operating activities		(451)	1,221
Cash flow from investment activities
Acquisition and disposal of property, plant and equipment		(1,047)	(354)
Interest received		3	7
Disposal of subsidiaries, net of cash disposed
Cash generated from / (used in) investment activities		(1,044)	(347)

The accompanying notes are an integral part of these consolidated financial statements

KSG Agro S.A. Unaudited fnterim Condensed Consofidated Statement of Cash Flows (continued)

for the nine months ended 30 September 2020

		Nine months 2020	Nine months 2019
/п thousands of US do/fars	Note	(unaudited)	(unaudited)
Cash flow from financing activities
Proceeds from bank and other loans	13	8,808	1,299
Repayment of bank and other loans	13	(7,383)	(1,771)
Repayment of leases	8		(290)
Cash generated from / (used in) flnancing activities		1,425	(762)
Net (decrease) / increase in cash and cash equivalents		(70)	112
Cash and cash equivalents at the beginning of the period		299	229
Effect of exchange rate differences оп cash and cash eguivalents		(42)	5
Cash and cash equivalents at the end of the period		187	346

Approved for issue and signed on behalf of the Воагd of Directors on 1 О November 2020.

A.V. Skorokhod Y.V. Kyselova

(Chief Executive Officer) (Chief Financial Officer)

The accompanying notes аге ап integral part of these consolidated financial statements

KSG Agro S.A. Unaudited Interim Condensed Consolidated Statement of Changes in Equity

for the nine months ended 30 September 2020

		Attributable to owners of the Company					Non-controlling Total equity interest
	Note	Share capital	Share premium	Treasury shares	Currency translation	Retained earnings	Total attributable to owners of the
In thousands of US dollars					reserve		Company
Balance as at 1 January 2019		150	37,366	(112)	(10,659)	(40,274)	(13,529)	7,167	(6,362)
Profit for the period				-		9,670	9,670	339	10,009
Other comprehensive income/(loss)					737		737	(273)	464
Total comprehensive income/(loss) for the period					737	9,670	10,407	હિંદ	10,473
Balance as at 30 September 2019 (unaudited)		150	37,366	(112)	(9,922)	(30,604)	(3,122)	7,233	4,111
Balance as at 1 January 2020		150	37,366	(112)	(3,877)	(37,901)	(4,374)	15,696	11,322
Profit for the period						6,032	6,032	(1,265)	4,767
Other comprehensive income/(loss)			1		(298)		(298)	(2,909)	(3,207)
Total comprehensive income/(loss) for the period					(298)	6,032	5,734	(4,174)	1,560
Balance as at 30 September 2020 (unaudited)		150	37,366	(112)	(4,175)	(31,869)	1,360	11,522	12,882

Approved for issue and signed on behalf of the Board of Directors on 10 November 2020.

A.V. Skorokhod (Chief Executive Officer)

Y.V. Kyselova/ (Chief Financial Officer)

The accompanying notes are an integral part of these consolidated financial statements

1. Corporate lnformation

KSG Аgго S.A. (the "Company") was incorporated under the name Borquest S.A. оп 16 November 2010 as а "Societe Anonyme" under Luxembourg Company Law for an unlimited period. Оп 08 March 2011 the Company's name was changed to KSG Agro S.A.

The registered office of the Company is at 24, rue Astrid, L-1143 Luxembourg and the Company number with the Registre de Commerce is В 156 864.

The Company and its subsidiaries (together referred to as the "Group") produces, stores, processes and sells agricultural products, mostly crops, pork and pigs in live weight, and its business эctivities эге conducted mэinly in Ukraine.

Average number of staff employed Ьу the Group in 2020 wэs 403.

2. Group Structure

The Company's immediэte pэrent is OLBIS lnvestments L TD SA, registered in Panэma, and the ultimate controlling рагtу is Мг. Sergiy Kasianov. OLBIS lnvestments L TD S.A. holds 64.62% of the issued shэre capital of the Company, 0.21 % of shares are treasury shares and the remэining 35.17% of shэres эге free float shares listed оп the Warsaw Stock Exchэnge.

Principal эctivities of the entities forming the Group and the Company's effective ownership interest in these entities as at 30 September 2020 and 31 December 2019 were as follows:

			Effective ownership ratlo, %
Entity	Principal activity	Country of reglstration	30 September 2020	31 DecemЬer 2019
KSG Agro S.A.	Holding company	LuxemЬourg
KSG Agricultural and lndustrial Holdin LTO	Subholding company	Cyprus	100%	100%
KSG Agro Polska **	Liquidation	Poland		100%
KSG Energy Group L ТО ••	Liquidation	Cyprus		50%
Parisifia L ТО ••	lntermediate holding com an	Cyprus	50%	50%
AЬbondanza SA	Trade of agricultural roducts	Switzerland	50%	50%
Enterprise #2 of Ukrainian Agricultural and lndustrial Holding LLC	Agricultural production	Ukraine	100%	100%
Trade House of the Ukrainian Agroindustrial Holding LLC ••	Oormant	Ukraine	100%	100%
Hlebna Liga LLC ••	Oormant	Ukraine	100%	100%
Scorpio Agro LLC	Agricultural production	Ukraine	100%	100%
Agrofirm Vesna LLC ••	Oormant	Ukraine	100%	100%
Agro-Trade House Oniprovsky LLC	Agricultural production	Ukraine	100%	100%
SPE Promvok LLC	Agricultural production	Ukraine	100%	100%
KSG Onipro LLC	Agricultural production	Ukraine	100%	100%
Agro Golden LLC	Agricultural production	Ukraine	100%	100%
Souz-3 LLC (Note 20)	Agricultural production	Ukraine	100%
KSG Trade House L ТО••	Oormant	Ukraine	100%	100%
Askoninteks LLC ••	Oormant	Ukraine	100%
Trade House Rantye (Note 20)	Trade of agricultural roducts	Ukraine		100%
Agro LLC (Note 20)	Liquidated	Ukraine		100%
Agroplaza LLC	lntermediate holding com an	Ukraine	50%	50%
Kolosyste LLC ••	Ukraine 50% Oormant		50%
Stepove LLC ••	Oormant	Ukraine	50%	50%
Ozherelo LLC ••	Oormant	Ukraine	50%	50%
Strong-lnvest LLC	Agricultural production	Ukraine	50%	50%
Rantye LLC	Agricultural production	Ukraine	50%	50%
Pererobnyk РЕ LLC **	Oormant	Ukraine	25%	25%

Notes to the Unaudited lnterim Condensed Consolidated Financial Statements tor the nine months ended 30 September 2020

(А// amounts in USO thousand, unless otherwise stated)

Entity			Effective ownership ratio, %
	Principal activity	Country of registration	30 September 2020	31 December 2019
Ukrzernoprom - Prudy LLC •	Agricultural production	Ukraine	50%	50%
Ukrzernoprom - Uyutne LLC •	Agricultural production	Ukraine	50%	50%
Ukrzemoprom - Kirovske LLC •	Agricultural production	Ukraine	50%	50%
Ukrzemoprom - Yelizavetove LLC *	Agricultural production	Ukraine	50%	50%

Entities marked with * are located in Crimea. The Group has no operating control over them from October 2014, so deconsolidation of these entities was provided and net assets were written off to zero.

Entities marked with ** did not provide operational activity in 2020 and 2019 and аге not consolidated due to immateriality. For Pererobnyk РЕ LLC, the Group has no operating control and accounts for its investment under the equity method, although it is not separately presented in these financial statements due to its immateriality.

The Group consolidates all other subsidiaries, including those where it owns less than 51 per cent of the equity shares. Based оп the contractual arrangements between the Group and other investors, the Group has the power to appoint and remove the majority of the board of directors of these subsidiaries. The relevant activities of subsidiaries are determined Ьу their boards of directors based on simple majority votes. Therefore, management of the Group concluded that the Group has control over the subsidiaries and the subsidiaries are consolidated in these financial statements.

3. Operating Environment and Going Concern

ln determining the appropriate basis for preparation of the consofidated financial statements, Management are required to consider whether the Group can continue in operational existence for the foreseeaЫe future. The financial performance of the Group is naturally dependent upon weather conditions in areas of operation and the wider economic environment of Ukraine.

With the recent and rapid development of the Coronavirus disease (COVID-19} outbreak, the world economy entered а period of unprecedented health саге crisis that has already caused consideraЫe global disruption in business activities and everyday life.

Many countries have adopted extraordinary and economically costly containment measures. Certain countries have required companies to limit or even suspend normal business operations. Governments of all countries where the Group operates have implemented restrictions оп travelling as well as strict quarantine measures.

lndustries such as tourism, hospitality and entertainment are expected to Ье directly disrupted significantly Ьу these measures. Other industries such as manufacturing and financial services are expected to Ье indirectly affected and their results to also Ье negatively affected.

The financial effect of the current crisis оп the global economy and overall business activities cannot Ье estimated with reasonaЫe certainty at this stage, due to the расе at which the outbreak expands and the high level of uncertainties arising from the inabllity to reliaЫy predict the outcome.

Management has considered all availaЫe information about the future, which was oЬtained after 30 September 2020, including the impact of the COVID-19 outЬreak оп customers, suppliers and staff, as well as actual and projected foreseeaЫe impact from various factors, such as the fol/owing:

• whether the Group can continue to operate if staff were not аЫе to physically Ье present;

• • the duration that the Group could survive given the availabllity of cash resources and the flexibllity of its cost base;
• • whether there has been а significant decline in revenue;
• • whether there has been а significant erosion of profits due to higher costs or incurrence of unforeseen expenses;
• • whether there is а likelihood of potential breach of dеЫ covenants as а result of the adverse impact оп its financials;
• • whether there have Ьееп any concerns оп the continuation of receipt of goods and services from suppliers.

Management has concluded that there is по significant impact in the Group's profitabllity position. The event is not expected to have an immediate material impact on the business operations.

Management will continue to monitor the situation closely and will assess the need for additional measures in case the period of disruption becomes prolonged.

4. Adoptlon of New or Revised Standards and lnterpretations

The Group has adopted the following new and amended IFRS Standards and lnterpretations that are effective for annual periods beginning оп ог after 1 January 2020:

• IFRS 17 lnsurance Contracts;
• Amendments to IFRS 10 and IAS 28: Sale ог Contribution of Assets between an lnvestor and its Associate or Joint Venture;
• Amendments to IFRS 3: Definition of а business;
• Amendments to IAS 1 and IAS 8: Definition of material;
• Conceptual Framework: Amendments to References to the Conceptual Framework in IFRS Standards.

The adoption of the above Standards and lnterpretations has not had any material effect оп the disclosures or оп the amounts reported in these consolidated financial statements. However, following the clarified guidance of the new Conceptual Framework in respect of 'obscuring information', going forward the Group plans to change the order and format of certain disclosures where such change would improve the presentation of information to the primary users.

5. Summary of Significant Accounting Policies

Basis of preparation

These consolidated financial statements have been prepared in accordance with lnternational Accounting Standard (IAS) 34 "lnterim Financial Reporting", and should Ье геаd in conjunction with the Group's last annual consolidated financial statements as at and for the уеаг ended 31 December 2019 ('last annual financial statements').

These consolidated financial statements аге condensed, i.e. they do not include all the information required for а complete set of IFRS financial statements. However, selected explanatory notes are included to explain events and transactions that Management deemed significant to an understanding of the changes in the Group's financial position and performance since the last annual financial statements.

The accounting policies applied in these interim financial statements are the same as those applied in the Group's last annual financial statements. Any changes in accounting policies during the interim period are also expected to Ье reflected in the Group's consolidated financial statements as at and for the year ending 31 December 2020.

Functional and presentation currency

The currency of each consolidated entity is the currency of the primary economic environment in which the entity operates. The functional currency for the majority of the consolidated entities is the Ukrainian hryvnia. As the Group's management uses USD when monitoring operating results and financial condition of the Group, the presentation currency of the financial statements is USD.

The exchange rates used for translating foreign currency balances аге:

	USD	EUR
As at 30 September 2020	28.2989	33.1309
Average for nine months ended 30 September 2020	26.5261	29.8292
As at 31 December 2019	23.6862	26.4220
Average for nine months ended 30 September 2019	26.3687	29.6436
As at the date these financial statements аге being issued	28.1116	33,3938

6. Critical Accounting Estimates and Judgements

The Group makes estimates and assumptions that affect the amounts recognised in the consolidated financial statements. Estimates and judgements аге continually evaluated and аге based оп management's experience and other factors, including expectations of future events that аге believed to Ье reasonaЬle under the circumstances. Management also makes certain judgements, арагt from those involving estimations, in the process of applying the Group's accounting policies.

The significant judgments made Ьу Management in applying the Group's accounting policies and the key sources of estimation uncertainty were the same as those that applied to the last annual financial statements.

Notes to the Unaudited lnterim Condensed Consolidated Financial Statements for the nine months ended 30 September 2020 (А// amounts in USD thousand, un/ess otherwise stated)

7. Property, Plant and Equipment

Changes in property, plant and equipment for the nine months ended 30 September 2020 were as follows:

	Buildings	Agricultural egui�ment	Vehicles and office egui�ment	Construction in �rogress	Total
As at 1 January 2020
Cost	18,436	5,517	681	1,941	26,575
Accumulated de�reciation	(4,140)	(2,478)	(398)		(7,016)
Carrying amount	14,296	3,039	283	1,941	19,559
Additions	55	261	81	732	1,129
Disposals	(15)	(66)	(1)		(82)
Acquisition/(disposal) of subsidiaries	59	273	29	168	529
Transfers	435	52	6	(493)
Depreciation charge	(492)	(214)	(51)		(757)
Exchange differences	(2,336)	(488)	(60)	(331)	(3,215)
Carrying amount	12,002	2,857	287	2,017	17,163
As at 30 September 2020 (unaudited)
Cost	15,976	5,745	694	2,017	24,432
Accumulated de�reciation	(3,974)	(2,888)	(407)		(7,269)
Carrying amount	12,002	2,857	287	2,017	17,163

8. Leases

Changes in right-of-use assets for the nine months ended 30 September 2020 were as follows:

	2020
Cost	1,810
Accumulated amortisation	(512)
Right-of-use assets as at 1 January	1,298
Recognition of lease liabllity	20
Amortisation charge	(343)
Exchange differences	(191)
Right-of-use assets as at 30 September (unaudited)	784
Cost	1,534
Accumulated amortisation	(750)
Right-of-use assets as at 30 September (unaudited)	784

Changes in lease liabllities for the nine months ended 30 September 2020 were as follows:

	2020
Lease liablllties as at 1 January	2,742
Recognition of lease Jiabllity	780
lnterest accrued	356
lnterest paid	(225)
Exchange differences	(505)
Lease liabllities as at 30 September (unaudited)	3,148

Notes to the Unaudited lnterim Condensed Conso/idated Financia/ Statements for the nine months ended 30 September 2020 (AII amounts in USD thousand, unless otherwise stated)

9. Biological Assets

	30 September 2020 (unaudited)		31 December 2019
Non-current blological assets (livestock)	Units	Amount	Unlts	Amount
Sows	5,022	27,781	4,777	33,191
Boars	38	6	32	3
Total non-current blological assets		27,787		33,194
Current blological assets (livestock)	Units	Amount	Units	Amount
Pigs and piglets	45,190	2,492	38,420	1,822
Current blological assets (crops)	Hectares	Amount	Hectares	Amount
Wheat	7,055	3,893	4,948	2,640
Barley	1,176	738	1,176	711
Rapeseed	1,856	942	2,038	678
Sunflower			59	27
	8,377	970
Other Total current blological assets	2,352	423 9,458	36	188 6,066
Total blological assets		371245		391 260

Changes in Ьiological assets for the nine months ended 30 September 2020 were as follows:

	Cro(!S	Livestock	Total
Carrying amount as at 1 January 2020	4,244	35,016	39,260
Purchases
lnvestments into future crops and livestock	4,245	8,180	12,425
Sales		(8,432)	(8,432)
Gain/(loss) arising from changes in fair value attributaЫe to physical changes and changes in market prices	4,886	971	5,857
Farrow		104	104
Harvested during the period	(5,503)		(5,503)
Exchange differences	(906)	(5,560}	(6,466)
Carrying amount as at 30 September 2020 (unaudited)	6,966	30,279	37,245

10. lnventories and Agricultural Produce

	30 September 2020 (unaudited)	31 December 2019
Agricultural produce	2,546	1,839
Work in progress	3,212	2,070
Semi-finished products	494	1,091
Agricultural stock	1,620	1,791
Raw materials	663	574
Goods for resale	417	513
Finished products	101	120
Fuel	722	266
Other	668	156
Total inventories and agricultural produce	10,443	8,420

Notes to the Unaudited Interim Condensed Consolidated Financial Statements

for the nine months ended 30 September 2020

(All amounts in USD thousand, unless otherwise stated)

11. Trade and Other Accounts Receivable

	30 September 2020 (unaudited)	31 December 2019
Trade accounts receivable	2,482	6,637
Less: provision for trade accounts receivable Loans issued	(564) 2,880	(4,272) 5,661
Less: provision for loans issued	(1,796)	(3.350)
Other financial receivables	865	3,521
Less: provision for other financial receivables	(484)	(3.079)
Total financial accounts receivable	3.483	5,118
Advances issued	343	245
Less: provision for advances issued	(37)	(41)
Total trade and other accounts receivable	3.789	5,322

12. Trade and Other Accounts Payable

	30 September 2020 (unaudited)	31 December 2019
Trade accounts payable	13,487	17,833
Financial assistance received	1,266	1.495
Other financial payables	4.876	6,016
Total financial accounts payable	19.629	25,344
Prepayments received	3,133	2,841
Provision for tax liabilities	837	1.001
Wages and salaries accrued	ત્વે છે.	104
Total trade and other accounts payable	23.694	29,290

13. Bank and Other Loans

	30 September 2020 (unaudited)	31 December 2019
Bank loans	12,173	10,882
Other loans	1.500	1.500
Loan from Parent	10.973	10.973
Interest payable	4.654	5.905
Total bank and other loans	29.300	29.260

Changes in bank and other loans for the nine months ended 30 September 2020 were as follows:

	2020
Carrying amount as at 1 January	29,260
Loans received	8.808
Loans repaid	(7,383)
Interest accrued	1,153
Interest paid	(772)
Interest write-off	(1,487)
Exchange differences	(279)
Carrying amount as at 30 September (unaudited)	29,300

As of 4 August 2020, the Group has fully repaid its loan from LBBW, fixing the total amount of its bank and other loans at USD 29.3 million, the current portion of which being only USD 4.4 million. This was the Group's last overdue loan.

14. Operating Segments

The Group has three reportable segments, as described below, which are the Group's strategic divisions offer different products and services, and are managed separately because they require different technology and marketing strategies. For each of the strategic divisions, the Group's CEO reviews internal management reports on at least quarterly basis. The operations in each of the Group's reporting segments are:

• · Crops. Covers production of own summer crops (sunflower, corn) and winter crops (wheat, barley, rapeseed), as well as provision of land cultivation services and wholesale trading of crops. Main factors affecting crop production are climate conditions, land guality, plant nutrition and moisture levels in the arable land.
• · Pigs. The segment which deals with breeding of pigs, own Danish purebred sows, and sale of pigs and piglets in live and dead weight.
• · Other. This operating segment includes the production of fuel pellets, thermal energy and rendering of other services to third parties.

Starting in 2020, the 'Livestock/Pigs Breeding' and the 'Food Processing' segments were merged as one segment' 'Pigs'. Previously, livestock also included cows and food production included milk and flour, but, this no longer being the case, the Group has decided to change the way it presents segment information.

Performance is measured based on segment profit or loss, as included in the internal management reports that are reviewed by the Group's CEO. Segment profit or loss is used to measure performance as management believes that such information is the most relevant in evaluating the results of the Group's segments relative that operate within these industries.

Seasonality of operations

Crop production segment, due to seasonality and implications of relevant reporting standards, in the year mainly reflects the sales of carried forward agricultural produce and effect of biological assets revaluation, while during the second half of the year it reflects sales of crops and effect of revaluation of agricultural produce harvested during the year. Also, crop production segment has seasonal requirements for working capital increase during November-May, to underfake land preparation work. Other segments are not significantly exposed to seasonal fluctuations.

Information about operating segments for the nine months ended 30 September 2020 (unaudited) is as follows:

	Crops	Pigs	Other	Total
Revenue, including:
- sales of goods	4,688	7,414	354	12,456
- rendering of services	2.172		38	2,210
Revenue from external customers	6.860	7.414	392	14.666
Net change in fair value of biological assets and agricultural produce	4,886	1,075	-	5.961
Cost of sales	(4.967)	(8,070)	(824)	(13,861)
Segment profit/(loss)	6.779	419	(432)	6,766

Information about operating segments for the nine months ended 30 September 2019 (unaudited) is as follows:

	Crops	Pigs	Other	Total
Revenue, including:
- sales of goods	7.767	7,841	163	15,771
- rendering of services	1,920		66	1,986
Revenue from external customers	9,687	7,841	229	17,757
Net change in fair value of biological assets
and agricultural produce	2,570	3,114	-	5,684
Cost of sales	(9,729)	(11,233)	(616)	(21,578)
Segment profit/(loss)	2.528	(278)	(387)	1,863

Notes to the Unaudited lnterim Condensed Consolidated Financial Statements for the nine months ended 30 September 2020 (А// amounts in USD thousand, unless otherwise stated)

15. Selling, General and Administrative Expenses

	Nine months 2020 {unaudited)	Nlne months 2019 {unaudited)
Wages and salaries	403	170
lnformational, expert and consulting services	148	59
Delivery costs	159	328
Storage costs	234	274
Depreciation and amortisation	53	106
Taxes, other than income tax	19	9
Bank services	160	39
Fuel and other materials	12	2
Office maintenance costs	4
Business trips	19
Other exeenses		89
Total selling, general and admlnistrative expenses	1,211	1,076

16. Other Expenses

	Nine months 2020 {unaudited)	Nine months 2019 {unaudited)
lmpairment of trade and other receivaЫes	3,564	2,319
lnventory write-down	658	59
lmpairment of cash and cash equivalents	90
VA Т write-off	55	464
Fines and eenalties		675
Total other expenses	4,367	3,517

17. Finance lncome and Expenses

	Nine months 2020 {unaudited)	Nine months 2019 {unaudited)
Flnance income
lnterest income	3	6
Other finance income	1,537	11,064
Total finance income	1 540	11 070
Finance expenses
lnterest expense on bank and other loans	(1,153)	(840)
lnterest expense on leases	(356)	(401)
Other finance exeenses	{2)	{44)
Total finance expenses	(1,511)	(1,285)

18. Foreign Currency Exchange Gain/(Loss), net

	Nine months 2020 (unaudited)	Nine months 2019 (unaudited)
Foreign currency exchange gain	359	2,294
Foreign currenc}! exchange loss	(2,256)	(406)
Net amount	(1,897)	1,888

Notes to the Unaudited Interim Condensed Consolidated Financial Statements for the nine months ended 30 September 2020 (All amounts in USD thousand, unless otherwise stated)

19. Related Parties

Significant related party balances outstanding were as follows:

	30 September 2020 (unaudited)		31 December 2019
	Parent and	Entities under	Parent and	Entities under
	owners	common control	owners	common control
Assets
Trade and other accounts receivable		437		424
Loans issued		1,227		1,230
Other financial receivables		5		6
Advances issued	1	38		54
Liabilities
Loan from Parent	10,973		10,973
Interest on loan from Parent	4,111		3.864
Trade and other accounts payable	25	135	25	128
Financial assistance received		9		11
Other accounts payable		848		702
Prepayments received	1	9		90

20. Group Reorganisation

During 2020, the Group liquidated its subsidiaries Trade House Rantye LLC and Agro LLC.

Souz-3 LLC, an old subsidiary of the Group which had been deconsolidated in 2015 as a result of a bankruptcy process, has now completed its financial reorganisation procedure and is now again consolidated as part of the Group.

21. Events After the Reporting Period

As at the date of this report, the Group has successfully completed the sowing campaign for winter crops. There were no other material subsequent events.