Panevezio Statybos Trestas

Quarterly Report • Jun 8, 2015

PANEVĖŽIO STATYBOS TRESTAS AB

CONSOLIDATED INTERIM FINANCIAL STATEMENT for three months of 2015

29 May 2015 Panevėžys

PANEVĖŽIO STATYBOS TRESTAS AB

Consolidated and Company Financial Statements for the Quarter Ending 31 March 2015

Unaudited

Company register given code 147732969 Address of registered office P. Puzino Str. 1, LT-35173 Panevėžys, Lithuania

STATEMENT OF EXECUTIVE OFFICERS OF THE COMPANY

Hereby we confirm that on the basis of the information available to us, the Consolidated Interim Financial Statements for three months of 2015 made in accordance with the International Financial Reporting Standards are true and show the assets, liabilities, financial state, and profit or loss and cash flow of Panevėžio statybos trestas AB and the companies of Panevėžio statybos trestas Group in a correct manner.

Dalius Gesevičius, Managing Director Panevėžio statybos trestas AB

Drawees

Dale Bernotaitiene, Finance Director Panevėžio statybos trestas AB

Main data about the issuer

Name of issuer	Public limited liability company Panevėžio statybos
	trestas
Authorized capital	16,350,000 Litas
Address of registered office	P. Puzino Str. 1, LT-35173 Panevėžys, Lithuania
Telephone	$(+370 45) 505 503$
Fax	$(+37045)$ 505 520
E-mail	pst@pst.lt
Legal-organization form	Public limited liability company
Registration date and place	30 October 1993, Panevėžys City Department
Registration No.	AB 9376
Code at the register of enterprises	147732969
VAT code	LT477329610
Administrator of legal entity register	State Enterprise Centre of Registers
Web address	www.pst.lt

Board

Remigijus Juodviršis, Chairman Artūras Bučas Virmantas Puidokas Vilius Gražys Audrius Balčėtis

Management

Dalius Gesevičius, Managing Director

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Separate statement of financial position

In Euros

ASSETS	31 March 2015	31 Dec. 2014
Non-current assets	13,078,944	12,851,879
Intangible assets	27,366	33,993
Tangible assets Investment and amounts receivable in one	5,002,285	4,670,874
year	7,918,326	7,922,910
Deferred tax assets	130,967	224,102
Current assets	48,118,245	48,846,950
Inventories	1,668,497	1,677,421
Advance payments	322,874	225,653
Amounts receivable	22,783,434	17,815,632
Other current assets	11,429,840	10,525,509
Cash and cash equivalents	11,913,600	18,602,735
TOTAL ASSETS	61,197,189	61,698,829

EQUITY AND LIABILITIES	31 March 2015	31 Dec. 2014
Equity	39,934,005	39,481,724
Share capital	4,741,500	4,735,287
Reserves	1,975,611	2,014,199
Retained profit (loss)	33,216,894	32,732,238
Translation reserve
Minority share
Amounts payable and liabilities	21,263,184	22, 217, 105
Amounts payable in one year and long term liabilities	732,301	742,961
Loans and borrowings
Warranty provision	467,229	471,079
Deferred tax liabilities	265,072	271,882
Amounts payable in one year and short
term liabilities	20,530,883	21,474,144
Loans and borrowings
Trade payables	14,554,980	13,271,581
Prepayments received	2,629,263	3,827,411
Current tax payable	512,893	461,157
Other liabilities	2,833,747	3,913,995
TOTAL EQUITY AND LIABILITIES:	61,197,189	61,698,829

Consolidated statement of financial position

In Euros

$\overline{a}$ $\overline{\phantom{a}}$

ASSETS	31 March 2015	31 Dec. 2014
Non-current assets	7,904,734	15,314,102
Intangible assets	105,546	118,587
Tangible non-current assets	6,170,407	7,070,648
Investment assets Other investment and amounts receivable	0	6,101,702
in one year	148,075	152,620
Other intangible assets	1,480,706	1,870,545
Current assets	67,911,759	63,584,498
Inventories	13,431,870	16,069,779
Advance payments	4,141,239	2,400,466
Amounts receivable	26,150,634	22,932,492
Assets held for resale	7,856,689	0
Other assets	1,277,509	1,232,913
Cash and cash equivalents	15,053,818	20,948,848
TOTAL ASSETS:	75,816,493	78,898,600

EQUITY AND LIABILITIES	31 March 2015	31 Dec. 2014
Equity	37, 311, 173	35,232,923
Share capital	4,741,500	4,735,287
Reserves	2,453,959	2,495,738
Retained profit (loss)	28,026,695	25,569,113
Translation reserve	2,089,019	2,432,785
Minority share	1,547,762	982,296
Amounts payable and liabilities	36,957,558	42,683,381
Amounts payable in one year and long
term liabilities	1,142,221	4,041,023
Loans and borrowings	59,878	2,430,941
Provisions	740,233	742,578
Deferred tax liabilities	321,438	775,953
Grants and subsidies	20,672	23,027
Other payable amounts	0	68,524
Amounts payable in one year and short
term liabilities	35,815,337	38,642,358
Loans and borrowings	2,042,047	6,201,947
Trade payables	16,817,185	15,874,970
Prepayments received	8,032,033	9,844,344
Current tax payable	642,008	580,240
Liabilities held for resale	3,189,562	0
Other liabilities	5,092,502	6,140,857
TOTAL EQUITY AND LIABILITIES:	75,816,493	78,898,600

Separate statement of comprehensive income

ITEM	31 March 2015	31 March 2014
SALES	18,871,869	11,642,683
COST OF SALES	17,329,843	10,382,100
GROSS PROFIT (LOSS)	1,542,026	1,260,583
OPERATING EXPENSES	1,193,978	763,850
Selling	47,981	27,530
General and administrative	1,145,997	736,320
PROFIT (LOSS) FROM TYPICAL OPERATIONS	348,048	496,733
OTHER OPERATIONS	14,398	$-17,159$
Income	70,086	68,517
Expenses	55,688	85,676
FINANCIAL AND INVESTING ACTIVITIES	222,875	$-207,338$
Income	241,356	90,072
Expenses	18,481	297,410
PROFIT FROM ORDINARY ACTIVITIES (LOSS)	585,321	272,236
EXTRAORDINARY GAIN
EXTRAORDINARY LOSSES
PROFIT (LOSS) BEFORE TAXATION	585,321	272,236
INCOME TAX	139,254	59,415
NET PROFIT (LOSS)	446,067	212,821

Consolidated statement of comprehensive income

	.,

ITEM	31 March 2015	31 March 2014
SALES	26,317,300	17,608,777
COST OF SALES	23,440,310	15,088,823
GROSS PROFIT (LOSS)	2,876,990	2,519,954
OPERATING EXPENSES	1,785,692	1,365,372
Selling	137,763	123,348
General and administrative	1,647,929	1,242,024
PROFIT (LOSS) FROM TYPICAL OPERATIONS	1,091,298	1,154,582
OTHER OPERATIONS	$-37,409$	84,262
Income	52,873	264,462
Expenses	90,282	180,200
FINANCIAL AND INVESTMENT ACTIVITIES	2,420,614	$-1,409,547$
Company elimination	1,379,452	$\mathbf{0}$
Other income	1,119,995	10,936
Expenses	78,833	1,420,483
PROFIT FROM ORDINARY ACTIVITIES (LOSS)	3,474,503	$-170,703$
EXTRAORDINARY GAIN
EXTRAORDINARY LOSSES
PROFIT (LOSS) BEFORE TAXATION	3,474,503	$-170,703$
INCOME TAX	343,995	$-199,082$
NET PROFIT (LOSS)	3,130,508	28,379
ATTRIBUTABLE TO SHAREHOLDERS ATTRIBUTABLE TO MINORITY	2,414,736	161,143
INTEREST	715,772	$-132,764$

Separate statement of changes in equity

In Euros

Total	38,405,045 $-3,257$ 212,821	38,614,609 6,214 39,481,724 446,067	39,934,005
Retained profit	39,550 31,492,643 212,821	31,745,014 32,732,238 446,067 38,589	33,216,894
reserve Legal	473,537	473,537 473,537	473,537
tangible asset Non-current revaluation reserve	1,703,578 $-42,807$	-38.588 1,540,662 1,660,771	1,502,074
Authorized capital	4,735,287	4,735,287 4,735,287 6,213	4,741,500
	Total other comprehensive income Balance as of 1 January 2014 Net profit (loss) for 2014	Total other comprehensive income Balance as of 31 December 2014 Balance as of 31 March 2014 Net profit (loss) for 2015	Balance as of 31 March 2015

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Consolidated statement of changes in equity

In Euros

	Authorized capital	Revaluation reserve	reserve Legal	Influence of change in exchange rate	Accumulated profit	Losses per company parent share	Minority part	Total
Balance as of 1 January 2014	4,735,287	2,141,658	598,468	284.789	27,052,814	34,813,016	1,260,310	36,073,326
Other comprehensive income Net profit (loss) for 2013		$-45,996$		171.922	161,144 42.739	161,144 168.665	-132,765 111.088	28,379 279,753
Balance as of 31 March 2014	4,735,287	2,095,662	598,468	456,711	27,256,697	35,142,825	1,238,633	36,381,458
Balance as of 31 December 2014 Net profit (loss) for 2015	4,735,287	1,897,270	598,468	2,432,785	25,569,113	35,232,923	982,296	36,215,219
Other comprehensive income Reserves formed	6,213 4,735,287	41,779 2,095,662	598.468	-343.766 456,711	2,414,736 42,846 27,256,697	2,414,736 35,142,825 -336,486	1,238,633 715,773 $-150.307$	3,130,509 -486,793
Balance as of 31 March 2015	4,741,500	1,855,491	598,468	2,089,019	28,026,695	37,311,173	1,547,762	36,381,458 38,858,935

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Separate statement of cash flows

In Euros

	Jan. through March 2015	Jan. through March 2014
Cash flow from main operations
Net profit (loss)	446,067	212,821
Depreciation and amortization costs	209,531	190,352
(Profit) loss from transfer of non-current assets	$-3,520$	10,888
	652,078	414,061
Change in inventories	8,924	$-377,518$
Changes in trade receivables	$-4,967,802$	$-2,302,134$
Change in prepayments	$-97,221$	743,055
Change in amounts receivable after one year	4,584	28,592
Change in other assets	$-67,335$	$-2,118,938$
Change in trade payables	1,283,399	1,452,963
Change in prepayments received	$-1,198,148$	$-1,790,095$
Change in provisions and other liabilities	$-997,848$	41,840
Net cash flow from main operations	$-5,379,369$	$-3,908,174$
Cash flow from investing activities
Acquisition of non-current assets (excl.
investments)	$-549,133$	$-305,823$
Transfer of non-current assets (excl. investments)	19,226	19,712
Acquisition of investments		$-6,432$
Loans issued	$-1,544,521$	$-2,484,249$
Loans recovered	781,657	676,012
Dividends and interest received	693	3,487
Net cash used in investing activities	$-1,292,078$	$-2,097,293$
Cash flow from financial activities
Dividends paid	0	$-653$
Proceeds from loans and borrowings	0	1,080
Repayment of loans and borrowings	$\bf{0}$	$-1,080$
Interest paid	$-17,688$	$-8,307$
Net cash from (used in) financing activities	$-17,688$	$-8,960$
Increase (decrease) in net cash flow	$-6,689,135$	$-6,014,427$
Cash and its equivalent as of January 1	18,602,735	13,957,491
Cash and its equivalent as of December 31	11,913,600	7,943,064

Consolidated statement of cash flows

In Euros

	2015	Jan. through March Jan. through March 2014
Cash flow from main operations
Net profit (loss)	3,130,508	28,378
Elimination of other non-monetary items
Depreciation and amortization costs	284,398	253,270
Other non-monetary items	$-217,683$	$-283,593$
	3,197,223	$-1,945$
Change in inventories	97,941	$-477,609$
Change in amounts receivable	$-3,218,227$	$-3,293,514$
Change in prepayments	$-1,740,773$	697,358
Change in other assets	$-616, 113$	$-2,246,496$
Change in trade payables	942,215	1,430,285
Change in prepayments received	$-1,812,311$	$-1,843,665$
Change in provisions and other liabilities	$-386,860$	$-1,553,009$
	$-3,536,905$	$-7,288,595$
Elimination of results from financial and investing
activities	$-1,628,780$	280,889
Net cash flow from main operations	$-5,165,685$	$-7,007,706$
Cash flow from investing activities
Acquisition of non-current assets (excl.
investments)	$-582,977$	$-396,728$
Transfer of non-current assets (excl. investments)	19,474	243,249
Acquisition of long term investments	0	$-6,432$
Loans recovered	357	327
Dividends and interest received	2,269	10,936
Net cash used in investing activities	$-560,877$	$-148,648$
Cash flow from financial activities
Dividends paid	0	$-653$
Proceeds from loans and borrowings	$\bf{0}$	472,319
Repayment of loans and borrowings	$-84,240$	$-64,260$
Payment of finance lease liabilities	-10,075	$-110,034$
Interest paid	$-74,153$	$-111,303$
Net cash from (used in) financing activities	$-168,468$	186,069
Increase (decrease) in net cash flow	$-5,895,030$
Cash and cash equivalent as of January 1	20,948,848	$-6,970,285$ 16,997,740
Cash and cash equivalent as of December 31	15,053,818	10,027,455

EXPLANATORY NOTE

General Information

Panevėžio statybos trestas AB (hereinafter "the Company") was established in 1957 and for a long tome was known as the North Lithuania Construction Trust (Siaures Lietuvos statybos trestas). In 1991 the Company was registered as a State Capital Company. On 30 October 1993 the State Capital Company was reorganized to a Public Limited Liability Company. Company code 147732969, VAT code LT477329610. Registration certificate No. 013732 issued on 27 September 2004 by the State Register Centre Panevėžys Branch.

The Company comprises the following branches: Gerbusta, Pastatų apdaila, Genranga, Konstrukcija, Betonas, Stogas and Klaipstata. The Company has its permanent establishments in Latvia and the Kingdom of Sweden. Financial year of the Company is calendar year. The period of commercialeconomic activities of the Company is unlimited.

The main operations of the Company and its subsidiaries (hereinafter "the Group") is designing and construction of various buildings, structures, facilities, communications and other similar objects in Lithuania and abroad, real estate development.

Subsidiaries	Type of operations	Share controlled (per cent)	Registered address
Skydmedis UAB	Construction: panel houses	100	Pramonės Str. 5, Panevėžys Tel.: +370 45 583341
Metalo meistrai UAB	Construction	100	Tinkly Str. 7, Panevėžys, Tel.: +370 45 464677
Vekada UAB	Construction: electrical installation	96	Marijony Str. 36, Panevėžys Tel.: +370 45 461311
Panevėžio statybos trestas AB and partners' Vilniaus papėdė TŪB	Real estate development	69	Švitrigailos Str. 8, Vilnius Tel.: +370 5 2609405
Alinita UAB	Construction: conditioning equipment	100	Tinkly Str. 7, Panevėžys Tel.: +370 45 467630
KINGSBUD Sp.z.o.o.	Intermediation services	100	A. Patli 16-400, Suwalki, Poland
PS TRESTS SIA	Construction	100	Vietalvas Str. 5, Riga
BALTILSTROIJ OOO	Construction 100		Sovetskij Ave. 43, Kaliningrad Tel.: 0074012350435

As of 31 March 2015, the Group includes the parent company and 11 subsidiaries:

Teritorija OOO	Real estate development	87.5	Lunacharskovo Lane 43- 27, Cherepovets, Vologda County
PST Nordic AB	Construction	100	Krossgatan 25, 162 50 Vällingby, Stockholm County
PST Investicijos UAB Real estate development		68	Verkių Str. 25C, Vilnius Tel.: +370 5 2728213
Subsidiaries of PST investicijos UAB:
Ateities projektai UAB	Real estate development	100	Verkiu Str. 25C, Vilnius
Šeškinės projektai UAB	Real estate development	100	Verkių Str. 25C, Vilnius
Verkių projektas UAB	Real estate development		Verkių Str. 25C, Vilnius
ISK Baltevromarket ZAO Real estate development		100	Pobeda Square 10, Kaliningrad

Authorized capital of the Company and its structure

As of 31 March 2015, the authorized capital of the Company was 4,741,500 EUR, it was divided into 16,350,000 ordinary registered shares (hereinafter referred to as ORS), the par value of one share being 0.29 EUR. All shares are intangible and fully paid. The property right for the shares is proved by the record in the stock accounts. The shares of Panevėžio statybos trestas AB are traded at the Vilnius Stock Exchange. On 31 March 2015 the total number of the shareholders was 1876. The shareholders who under the ownership right held or controlled more than 5 per cents of the authorized capital of the Company are as follows:

Name, surname of a shareholder (company name, type, headquarter address, company code)	Number of ordinary registered shares held by a shareholder under ownership right (pcs.)	Share of the authorized capital held $(\%)$	Portion of votes granted by the shares held under the ownership right(%)	Portion of votes owned by the shareholder along with acting persons $(\%)$
Panevėžio keliai AB S. Kerbedžio Str. 7, Panevėžys, Company code: 147710353	8,138,932	49.78	49.78
SWEDBANK AS (Estonia) CLIENTS Liivalaia 8, Tallin, Estonia 10060701	994,018	6.08	6.08
Freely negotiable shares	7,217,050	44.14	44.14

Changes in Panevėžio statybos trestas AB and OMX Baltic Benchmark GI indexes for January through March 2015

Variation in price of the Company shares at the Stock Exchange for January through March 2015 (in Euros)

Basis of interim financial statement preparation

The figures in the interim financial statement are presented in Euros.

The same accounting principles were applicable to both - the interim financial statement and the annual financial statement.

The following currency rates (amount of currency for 1 Euro) were used when preparing the interim financial statement:

Currency	31 March 2015	31 Dec. 2014
1 RUB	62.5595	68.7111
1 SEK	9.207	9.5260
1 PLN	4.0938	4.2916

Principles of consolidation

Subsidiary companies are the companies controlled by the parent company. Such control is defined as a capability to a company to have determinant effect on other company, manage and influence financial and economic activities to get benefit from that company. For the purposes of control assessment the total available number of shareholders' votes at the General Meeting of Shareholders is considered. The financial statements of subsidiary companies are included into the Consolidated Financial Statement from the day of control gain and are excluded from the day of control loss. During consolidation of financial statement the income and expenses, amounts receivable and payable and unrealized results of the Company Group are eliminated.

Investment

During the first quarter 2015 the investments of the Group in acquisition of non-current assets amounted to 582,977 Euros. Panevėžio statybos trestas AB acquired non-current assets for 549,133 Euros. During the first quarter of year 2015 the costs related to depreciation and amortization of assets of the Group amounted to 284,398 Euros, including 209,531 Euros accounted for in the Financial Statement of Panevėžio statybos trestas AB.

Assets

As sales of Verkių projektas UAB, the subsidiary company of PST investicijos UAB, is in progress in the first quarter of 2015, following IFRS 5.38 requirements the assets and liabilities of Verkiu projektas UAB are accounted for in the consolidated balance as current assets and liabilities for resale including the loan in the amount of 2,539,543 Euros provided by DNB bankas AB.

Loans

As of 31 March 2015, the Group had loans amounting to 2,101,926 Euros, including 1,735,649 Euros as long-term and short-term credits of PST investicijos UAB Group. Decrease in the amount loans was conditioned by elimination of the loan in the amount of 3,917,612 Euros provided by SEB bankas AB after bankruptcy proceedings have been initiated for Kauno erdve UAB and Sakališkės UAB, the subsidiary companies of PST investicijos UAB.

Guarantees, sureties

As of 31 March 2015, the guarantees of the liabilities of Panevėžio statybos trestas AB Group issued by credit institutions amounted to 12,768,418 Euros, including 10,542,122 Euros for performance guarantees issued by the credit institutions of the Russian Federation for Baltlitstroj OOO.

Transactions with associated parties

There were no significant transactions made with any associated parties.

Dividends

The Annual General Meeting of the Shareholders of Panevėžio statybos trestas AB that took place on 30 April 2015 took the decision to pay dividends for the year 2014 in the amount of 1,079,100 Euros.

Significant changes in the interim financial statement during the reporting period

Referring to the unaudited data, during three months of 2015 the Group of Panevėžio statybos trestas AB (PST) was on the income of 26.3 mln. Euros, that is by 49 per cents more than last year. The net profit of the PST Group for the first quarter of 2015 amounted to 315 mln. Euros including the profit in the amount of 1.4 mln. Euros calculated due to loss of control over Kauno erdve UAB and Sakališkės UAB (on 24 February 2015 the bankruptcy proceedings have been initiated at the Vilnius District Court) owned by PST investicijos UAB. In the first quarter of 2014 the Group incurred the loss in the amount of 0.028 mln. Euros.

Referring to the unaudited data, Panevėžio statybos trestas AB had the net profit in the amount of 0.446 mln. Euros, i. e. by 2.1 times more compared to 0.213 mln. Euros in the first quarter of 2014 and was on the income of 18.9 mln. Euros, i. e. by 62 per cents more than in the first quarter of 2014.

As Vilniaus papede TUB has not been operating since completion of reconstruction at the Palace of the Grand Dukes, Part A, liquidations proceedings have been initiated.

	Group			Company
	31 March 2013	31 March 2014	31 March 2015	31 March 2013	31 March 2014	31 March 2015
Income	18,606	17,609	26,317	13,135	11,643	18,872
Gross profit	1,038	2,520	2,877	345	1,261	1,542
Gross profit margin (per cent)	5.58	14.31	10.93	2.63	10.83	8.17
Net profit	$-436$	28,4	3,131	$-376$	212,9	585
Nets profit margin (per cent)	$-2.35$	0.16	11.9	$-2.86$	1.83	2.36
Profit per share	$-0.026$	0.002	0.191	$-0.023$	0.014	0.027
Profit before taxes, interest, depreciation and amortization EBITDA	9,85	193,8	3,834	1,16	470,92	813,00
EBITDA margin (per cent)	0.05	1.1	14.57	0.01	4.04	4.31
Return on equity (per cent) (ROE)	$-1.32$	0.08	8.39	$-0.99$	0.55	1.12
Return on assets or asset profitability (ROA)	$-0.67$	0.04	4.13	$-0.66$	0.4	0.73
Return on investments (ROI)	$-1.12$	0.07	7.83	$-0.98$	0.54	1.1
Current liquidity ratio	2.03	2.14	1.9	2.11	2.61	2.34
Acid test (Quick) ratio	1.44	1.57	1.52	2.04	2.53	2.26
General liquidity ratio	1.07	1.18	1.01	1.99	2.58	1.88
Asset to equity ratio	0.51	0.53	0.49	0.67	0.72	0.65
Book value per share	2.03	2.15	2.28	2.31	2.36	2.44
Ratio of share price and profit (P/E)	$-42.7$	587.7	4.65	$-49.6$	78.4	32.6
Ratio of share price and book value $(P/BV)$	0.56	0.47	0.39	0.49	0.43	0.36

The operating result of Panevėžio statybos trestas AB and the Group (in thousands EUROS):