Podravka d.d. — Interim / Quarterly Report 2015

Oct 27, 2015

Koprivnica, 27 October 2015

PODRAVKA INC.

UNCONSOLIDATED QUARTERLY FINANCIAL REPORT

FOR 1 – 9 2015 PERIOD

Content:

• General information
• Management report on the achieved business results of Podravka Inc. for the period January – September 2015
• Unconsolidated financial reports for the period January – September 2015
• Statement from executives responsible for preparing financial statements
• Contact

General information

Podravka prehrambena industrija d.d., Koprivnica, is incorporated in the Republic of Croatia. Today it is included in leading companies in industry operating in the area of South-Eastern, Central and Eastern Europe. The principal activity of the Company comprises production of a wide range of foodstuffs and non-alcoholic beverages.

The Company is headquartered in Koprivnica, Croatia, Ante Starčevića 32.

The Company's shares are listed on the official market of the Zagreb Stock Exchange.

Management Board members as at 30 September 2015

• President Zvonimir Mršić Member Olivija Jakupec
• Member Miroslav Klepač
• Member Hrvoje Kolarić

The unconsolidated financial statements have been prepared in accordance with International Financial Reporting Standards as adopted by the European Union ("IFRS").

Koprivnica, 27 October 2015

MANAGEMENT REPORT ON THE ACHIEVED BUSINESS RESULTS OF PODRAVKA INC. FOR THE PERIOD JANUARY – SEPTEMBER 2015

Significant events in 1 – 9 2015

Podravka d.d. share capital increase and ESOP¹

On 3 June 2015, the General Assembly of Podravka d.d., among other decisions, adopted the decision to increase the share capital by issuing new 1,700,000 regular shares and to introduce ESOP. According to the decision, on 7 July 2015 the subscription of new shares of Podravka d.d. was initiated, which ended as at 20 July 2015. The interest shown for subscription of new shares was 33 percent higher than the number of available shares, which proves a significant interest on the part of investors. Domestic pension funds subscribed 60.7% of new shares, the Republic of Croatia 22.2%, Skagen Funds 6.8%, employees 5.2%, and other shareholders subscribed 5.1% of new shares.

New regular shares were issued at the price of HRK 300.00 per share, whereby the amount of HRK 510 million was raised. The raised amount is planned to be used primarily to finance the acquisition of the company Žito d.d., while the remaining amount will be used to invest in business expansion to new markets and to finance the construction of the new solid, semi-solid and liquid drugs factory of Belupo d.d..

As part of the share capital increase process, the ESOP programme was initiated with the aim to further develop employee loyalty through participation in the company's ownership, increase in Podravka's productivity based on medium-term and long-term effects of the programme (motivation, efficiency, reliability, commitment...), including employees in share ownership at special terms, connecting employee interests with interests of the owners and creating additional impetus in achieving the company strategy, in the sense of connecting growth interests and profitability on the one hand and long-term benefits for the workers on the other.

¹ Employee Stock Ownership Programme.

Detailed information on the share capital increase and related documents are available on the websites of the Zagreb Stock Exchange (www.zse.hr) and the Podravka Group (www.podravka.hr).

Podravka concluded the agreement on acquiring 51.54% of Žito d.d. shares

On 21 April 2015, Podravka concluded the Agreement on the acquisition of 51.54 percent of regular shares of the company Žito d.d. at a price of EUR 180.1 per share, i.e. for the total amount of EUR 33,027,819. This transaction, after all preconditions determined by the Agreement had been met, was closed as at 5 October 2015 with the Central Securities Clearing Corporation of the Republic of Slovenia (KDD). The consortium of sellers is composed of Slovenski državni holding d.d. and Modra zavarovalnica, d.d., KD Kapital, d.o.o., KD Skladi, d.o.o., Adriatic Slovenica, d.d. and NLB Skladi, d.o.o.

In accordance with the regulations of the Republic of Slovenia, on 22 October Podravka submitted a takeover offer for the remaining shares of Žito d.d.. The takeover offer is valid from 23 October 2015 to 23 November 2015, till 12.00 AM. Depending on the interest of the remaining shareholders to sell shares, the total value of the transaction will possibly increase to EUR 57,670,361.

Žito is one of the largest and most renowned food producers in Slovenia with high recognisability on the markets of South-East Europe. With the stated acquisition, Podravka consolidates its position and becomes a leader in several additional product categories – thereby significantly improving its market position, especially on the Slovenian market.

After this transaction is completed, the Podravka Group will be at the top of the food industry in the market of Slovenia, with total annual revenue amounting to approximately HRK 900 million. It is expected that, after the takeover of Žito, the total consolidated annual revenue of the Podravka Group will be approximately HRK 4.5 billion.

Podravka and Žito have a very complementary product range – food products with similar models of production, sales, promotion, distribution and logistics. Žito has a wide portfolio of recognisable brands holding the leading or the second positions in the market, such as the umbrella brand Žito (flour and bakery products), Zlato polje (rice, pasta, mill products), Maestro (monospices), 1001 Cvet (teas), Natura (cereals and pulses), Gorenjka (chocolate), Šumi (candies).

Extending the business in complementary product groups, opportunities are created for the production, and sales and marketing synergies, improving the operational efficiency of both companies and increasing their competitiveness. It is particularly worth emphasising that this opens the possibility of selling Žito products through the Podravka's sales and distribution network in more than 20 countries around the world.

New organization of markets management and further strengthening of international operations

In the Podravka d.d. Management Board meeting held on 13 January 2015, the decision was made to form new market regions and to further strengthen business internationalization. There are four newly-formed regions: the Adria region including the market of Croatia and the previous South East Europe market, the Europe region including the previous markets of Western Europe and Central Europe, the Russia, CIS and Baltic region and the New markets region including America, Asia, Australia and Africa. The new organisation of markets management significantly simplifies the previous markets management complexity, increases the opportunities for a more efficient utilisation of own size and knowledge and provides a better and more cost-efficient support to markets where the Podravka Group operates.

One of the preconditions for the commencement of operations in international markets estimated as very potent was to register Podravka's company in Dubai (United Arab Emirates), Dar es Salaam (Tanzania) and the representative office in Beijing (China).

Podravka's decision to initiate the procedure for merging Danica d.o.o.

Continuing the implementation of measures to improve operational efficiency, Podravka's management made the decision to initiate the procedure for merging the limited liability subsidiary DANICA d.o.o. which ended on 1 October 2015.

Podravka's meat industry Danica d.o.o. has been operating as a separate entity for twenty years. After conducting business analyses of all business programmes within the Podravka Group, it was determined that by integrating Danica d.o.o., i.e. the meat programme, into the Podravka's food and drinks segment, a better focus on the development of this programme will be achieved, together with additional savings in almost all business processes, and thus presuppositions for better management of this business programme will be created.

Certain restructuring measures, i.e. business rationalisation, have been implemented in Danica d.o.o. over the past three years. Financial business indicators have been

improved, and further improvements can be achieved through the full integration of the meat programme into the Podravka's food segment.

The intention of this merger is to advance the development of Podravka's meat cans and meat products portfolio and to generate additional funds for strengthening the competitive position of this production programme on the increasingly demanding market.

Mirna d.d.'s account unblocked

On 25 August 2014, at public auctions for the sale of shares of Mirna d.d. through the trading system of Zagrebačka burza d.d. in the procedure of out-of-court settlement, Podravka d.d. acquired 198,209 shares of Mirna d.d., which represents 53.9% of the total issued shares of the company. Podravka d.d. acquired shares of Mirna d.d. at HRK 38.02 per share, or for a total of HRK 7.5 million. The shares of the company carried the voluntary lien on behalf of Podravka d.d. as security for loans granted by Podravka during 2009.

By acquiring these shares, on 29 September 2014 Podravka d.d., in accordance with the Act on the Takeover of Joint Stock Companies, issued a bid for taking over the remaining shares of Mirna d.d. at the price of HRK 38.02 per share, other than those carrying pledges. The takeover bid was accepted by seven shareholders, whereby Podravka d.d. acquired additional 37,153 shares, or additional 10.09% of the total issued shares of Mirna d.d. Following the takeover bid, Podravka d.d. became the holder of 235,362 shares of Mirna d.d. or 63.95% of the total issued shares.

In December 2014, Management of Mirna d.d. submitted a request to initiate the prebankruptcy settlement proceeding following the freezing of Mirna d.d. account, which was rejected. However, as at 29 January 2015, the Commercial Court in Rijeka decided to initiate the preliminary procedure for determining whether the conditions are met for initiating the bankruptcy procedure of the company Mirna d.d. As part of this, the temporary bankruptcy manager was appointed, and the hearing was scheduled for 30 March 2015.

At the hearing held as at 30 March on the Commercial Court in Rijeka it was established that there are no longer reasons to initiate the bankruptcy procedure over Mirna d.d. from Rovinj. Considering that by the completion of the preliminary procedure, the debtor Mirna d.d. became solvent as its account was unblocked, reasons envisaged by law for further bankruptcy procedures are no longer valid. Podravka d.d. as the majority shareholder of

Mirna d.d. directly settled a significant amount of due claims by Mirna d.d. and provided guarantees for settling other claims by the creditors of Mirna d.d. which are registered in the register of FINA. This creates preconditions for further normal operations of Mirna d.d.

On 9 July 2015 Podravka acquired additional 11.64% shares of the company Mirna d.d. and on 6 August 2015 additional 8.6% shares of the company Mirna d.d., reaching 84.2% ownership share in the company.

Key business highlights of 1 – 9 2015

In the first nine months of 2015, Podravka d.d. recorded sales of HRK 1,349.3 million, which is a 3.3% growth compared to the same period of the previous year. The increase in sales is a result, among other things, of the increase in sales of soups subcategory in the Adria region and condiments in the Adria and Europe regions. The increase in sales of the soups subcategory in the Adria region is the result of the fact that the soups range is better represented in chain stores than in the comparative period, entering the new category of premium cream soups and increased marketing activities. The condiments range had good sales results in the Adria and Europe regions as a result of increased marketing activities and better representation of the range in sales channels.

Total operating expenses of Podravka d.d. in the first nine months of 2015 amount to HRK 1,280.1 million which is 3.6% higher compared to the first nine months of 2014. In this, material costs increased the most, by 7.7%, as a result of the volume growth in sales in the period under consideration and higher marketing investments. The observed period was not burdened by significant costs of severance payments, which amounted to HRK 32.1 million in the first nine months of 2014.

Operating profit of Podravka d.d. in the first nine months of 2015 amounts to HRK 111.0 million, which is a 2.4% growth in relation to the comparative period.

In the first nine months of 2015, net finance costs of HRK 0.2 million were realised, positively impacted by the recognition of revenue arising from the fair valuation of the land used in the capital increase of the related company Belupo d.d..

Net profit realised in the first nine months of 2015 amounted to HRK 95.5 million which, in addition to the effects above the EBT level, was impacted by a lower tax rate due to utilisation of tax losses realised in 2014 based on reinvestment of profit.

As at 30 September 2015, the assets of Podravka d.d. amount to HRK 3,131.8 million and compared to the end of 2014 they are higher by HRK 549.0 million. The most significant change occurred on items loans given, deposits, etc. and cash at bank and cash in hand, primarily as a result of cash collected by issuing new 1,700,000 shares at a price of HRK 300.00 per share. In equity and liabilities, the most significant change occurred in the item registered (subscribed) capital, which increased by 44.5% following the decision on reinvesting net profit from 2014 and the already mentioned issuing of new shares. In the General Assembly meeting held on 3 June 2015, the decision was made to reinvest net profit for 2014 in a way that a portion of the net profit is used to increase the registered capital of Podravka d.d.. In accordance with this decision, the nominal value of Podravka d.d.'s shares was increased from HRK 200.00 to HRK 220.00. The nominal value of the new 1,700,000 issued shares was HRK 220.00 per share.

Cash flow from operating activities in the first nine months of 2015 was negative HRK 19.0 million which, among other things, was impacted by the increase in short-term receivables as a result of the seasonal nature where larger orders of products are recorded in the summer season compared to the end of the year. Cash flow from investing activities at the same time amounted to negative HRK 219.9 million, primarily due to cash used in the acquisition of equity and debt financial instruments. The cash collected by issuing new shares was deposited in cash funds until the moment of its utilisation. In the same period, cash flow from financing activities amounted to positive HRK 433.0 million, primarily due to proceeds from issued new 1,700,000 shares. In total, in the first nine months of 2015, there was an increase in cash and cash equivalents of HRK 194.1 million, an consequently cash and cash equivalents as at 30 September 2015 amounted to HRK 282.9 million.

President of the Management Board: Zvonimir Mršić

UNCONSOLIDATED FINANCIAL REPORTS FOR THE PERIOD JANUARY – SEPTEMBER 2015

Appendix 1 Reporting period:		1.1.2015		30.09.2015
		Quarterly financial report of entrepreneur - TFI-POD
Registration number (MBI)	03454088
Identification number of subject (MBS).	010006549
Personal identification number (CNB)	18928523252
Issueer company [PODRAVHA prehrambens industrija d.d., KOPRIVNICA
Postal code and place	48000	KOPRAWICA
Street and number AMTE STARCEWCA 32
E-mail address podravka@podravka.hr
internet adress: www.podranka.com
Code and name of comunatiown 201	KOPRIVNICA
Code and county name) e.	KOPRIVNIČKO-KRIŽEVAČKA			Number of amployees	3210
Consolidated statement NG.				(at quarter end) NKD/NWC code:	1039
Subsidiaries aubject to consolidation (according to IFRS):		Headquarters		Registration number:
Book keeping service
Contact person Leijek Senka	(authorised person for representation)
Phone number 648 653 283			Faecimile: 048 220 562
E-mail address: genka Jaflek försofnavka hr.
Surrisme and name Mršić Zvonimir Car Historical Inc.

	AOF
tion		Last Tear code		Current year
				Calculative : [ / Quarterly : [ Calculative]	Quarterly
	×
L OPERATING REVENUE (112=113)	118	1,884,507,434	436.458.021	1.291848.009	514,344,172
1. Sales reverse	112	1,705.725.543	474,559,835	1.5/8.268.235	ROJ 780, LKT
2. Other operating revenues. E. CIPERATIVO EXPENSES (115×116+120+124+125+126+126+126+136)	113	52,734,845	12.908.481	11.839.751	0.534.993
1. Changes in value of work in progress and finished products	114	1.336.055.984	430.143,830 28.724.435	1,259, 845, 137	438.813.265 -25.141.169
2. Material costs (117 to 115)	115	24.619.6M EW.235.043.	300, 304, 203	CK 2656 656 531.546.770
a) Row moterial and material costs.	118 117	406.788.938	175, 645, 660	498, 6403 (239)	1883607.015 that coco, tap
II Costs of goods said	150	200, 835, 401	71.405.185	346, 816 540	97,185,096
c) Other external costs	1/0	154 BOD 154	62.335.480	174 506 791	67417.036
3. Staff conta (121 to 123)	120	SIR 217 RM	82, 332, 428	307.548.032	86.871.108
a) McI salaries and wages	121	MESERIES	46.826.050	118 hot 060	53.4'(2.32)
It) Cost for taxes and contributions from salaries	122	M.12326	20.848.734	91612.059	20,810,543
c) Contributions on gross salaries	123	36,362,254	12.459.004	37.326.1an	12,720,862
4. Depreciation	124	55.004 ftp	20.316.181	55 216 2 to	19.635.30
5. Other costs	125	01/200.270	26.153.164	63,681,586	33,765.718
6. Impairment (127+128)	136	$-0.188.313$	3.898.750	3.825.284	3,848.021
a) impairment of long-term assets (financial assets each,dect)	127	王智	$-7.476$
b) impairment of short - term assets (financial assets excluded)	120	$-250.08$	3.080.225	2.835.294	3 649 921
7. Provisions	120		-135.692
8. Other operating costs	tiö	24,827,636	8.968.0%	29, 0203 (290)	8 487 315
IL FIMANCIAL INCOME (132 to 136)	131	32.182.454	33,941,300	26.842.729	3.879.455
1. Interest income, foreign eechange gains, dividends and similar income from related parties	132	7.585.807	2,925.440	11:183.831	$3 + 1 + 56$
2. Interest income, foreign eschange gains, dividends and similar income from non - related parties	133	29.610,406	17,080,880	12 32 13 13 1	1,208.166
3. Share in income from affiliated entropreneurs and participating interests.	136			11, 504, 336
4. Unrealized gains (incores) from financial assets	135	103.231	86.D'K	827,331	320, 288
5. Other financial income	135
IV. FINANCIAL EXPENSES (138 do 141)	137	56,682,638	28.260,632	38.0652.676	189.091.02
1. Interest copenses, foreign exchange losses, dividends and similar experises from related parties	t36	1.927,918	484, 230	6,329,151	2.804.708
2. Interest expenses, foreign coohange losses, dividends and similar expenses from non - related parties	139	54,685,320	30.247.7%	28.722.824	10.048.775
3. Unrealized losses (expenses) on financial assets	140
4. Other financial expenses	141				o
INCOME FROM INVESTMENT - SHARE IN PROFIT OF ASSOCIATED ENTREPRENEURS	142				ņ
LOSS PROM INVESTMENT - SHARE IN LOSS OF ASSOCIATED ENTREPRENEURS N٦	543
EXTRADROBARY - OTHER INCOME VB.	566
VIII. EXTRADROMARY - OTHER EXPENSES	145
TOTAL INCOME (111+131+142+144) loc.	148	834-986-102.5	107-129-321	1.428.001.688	678 223 628
TOTAL EXPENSES (116+137+143 + 145) u.	5.67	1.000.736.930	456,457,463	1.518.136.715	498 786 778
EL PROFIT OR LOSS BEFORE TAXATION (146-147)	148	88,931,336	48.001.889	110, 7905 SFR	29.450.046
Froft before transien (146-147)	140	88.931.336	48.021.889	193, 195, SVE	29-450.046
2 Loss before texation (147-146)	1/50
XIL PROFIT TAX	151	17.112.908	8.714.956	15,276,862	3,285.571
XIII. PROFIT OR LOSS FOR THE PERIOD (149-151)	152	71.010.428	36, 307, 803	05:5:10.884	26, 171, 276
1 Profit for the pariod (140-151)	153	71.816.428	38, 307, 003	05:5:10.064	26, 571, 276
2. Loss for this passed (151-140)	164	×	ø	s
APPEND IX to P&L economi (to be filled in by entrepreneur that property correctioleted financial report) XIV. PROFIT OR LOSS FOR THE PERIOD
1. Attributed to equipy holders of parent company	155
2. Attributed to minority interest	156	a		ö
STATEMENT OF OTHER COMPREHENSIVE INDOME (FRIS)
I. PROFIT OR LORR FOR THE PERIOD I= 152	w	71.518.039	38.307.003	06.5"SLBR4	38.131.379
II. OTHER COMPREHENSIVE INCOME / LOSS BEFORE TAX (159 do 165)	158			t
1. Exchange differences on translation of foreign operations	159			ť
2. Movements in reveluation reserves of long - term tangible and intengible sesers	180	٠		×
3. Profit or loss from reavaluation of financial assets available for sale	181			в
4. Gains or losses on efficient cash flow hedging	182	ä
5. Gains or losses on efficient hedge of a net investment in foreign countries.	163	ä
6. Share in other comprehensive income I loss of sesociated companies	164
7. Actuarial gains / losses on defined benefit plans	185
81. TAX ON OTHER COMPREHENSIVE INCOME FOR THE PERIOD	186
N. NET OTHER COMPREHENSIVE INCOME OR LOSS FOR THE PERIOD (158-166)	167
V. COMPREHENSIVE INCOME OR LOSS FOR THE PERIOD (157+167)	165	1006.075	58, 100, 100	95.5° IS 864	25.171.278
APPENDUL to Statement of other comprenhensive income (to be filled in by entrepreneur that prepares consolidated financial report) VI, COMPREHENSIVE INCOME OR LOSS FOR THE PERIOD
1. Attributed to equity holders of parent company	168
2. Militated to minority interest	178

PODRAVKA Inc., Koprivnica, Ante Starčevića 32, The Commercial Court in Varaždin, CRN: 010006549, PIN: 18928523252, Privredna banka Zagreb P.L.C., Zagreb, Radnička cesta 50, IBAN: HR94 2340 0091 1000 9852 6, share capital: HRK 1,566,400,660.00, paid in full, total number of shares issued: 7,120,003, nominal share value: HRK 220.00, President of the Supervisory Board: D. Štimac, President of the Management Board: Z. Mršić, members of the Management Board: O. Jakupec, M. Klepač, H. Kolarić

Obligator: Podravka prehrambena industrija d.d., Koprivnica
Though	AOP code	ast year inst.	Current your (men)
逋	ø	衙	$\overline{\mathbf{d}}$
ASSETS
A) RECEIVABLES FOR SUBSCRIBED BUT NOT PAID-IN CAPITAL	eps		Ű.
B) LONG-TERM ASSETS (003+010+020+029+033)	862	1.316.050.000 131.249.85	1.358.778.676
L INTANGIBLE ASSETS (004 to 000)	003		127.474.872
1. Assets development	604
2. Concessions, patents, licences fees, trade and service marks, software a 3. Goodwill	005 006	123,959,977	110.163.000 n
4. Potentrants for purchase of intercible search.	007		ol
5. Intensible assets in preparation	008	7 209.880	17.310 (999)
6. Other intencible assets	009
II. TANGIBLE ASSETS (011 to 019)	010	695.007.458	706.665.314
1. Land	811	39.650.515	38,329,651
2. Buildings	842	307.998.804	SP44 564, 046
3. Plant and equipment	013	190,426,114	209, 102, 563
4. Tools, facility inventory and transport assets	014	7.710.488	9.049.094
5. Biological assets	016
6. Prepayments for tangible assets	818	BBD 766	9.971.937
7. Tangible assets in progress.	917	53,005,088	121.049.006
8. Other tandible assets	018	227,828	726.118
9. Investments in buildings	019
III. LONG-TERM FINANCIAL ASSETS (021 to 028)	020	452 525.748	ARCT 2015 DATE
1. Investments (shares) with related parties	021	372, 392, 313	386.833.375
2. Loans given to related parties	022	73.250.000	66.266.405
3. Participating interest (shares)	023	9.919.795	Britishing
4. Loans to entrepreneurs in whom the entity holds participat	024		ũ
6. Investments in securities.	025		a
6. Loans, deposits and similar spects	026	在我还是相	3.677,809
7. Other long - tenn financial assets	027		ø
8. Investments accounted by equity method	028		ğ
IV. RECEIVABLES (600 to 032)	029	ğ.	ğ
1. Receivables from related parties	030		ä
2. Receivables from based on trade loans.	031		ċ
3. Other necessables	032	á
V. DEFERRED TAX ASSETS	0.33	36,966,946	36,747,930
C) SHORT TERM ASSETS (035+043+050+058)	034	1.267.415.768	1.739.393.393
L INVENTORIES (038 to 042)	035	538,075,090	688.173.897
1. Raw-material and supples.	0.36	117,405,771	148.635.279
2. Work in progress	007	27.484.468	38, 201-332
3. Finished poods	038	114.038.787	130.349.338
4. Meachemolise.	039	67.434.504	46.070.092
5. Presewments for inventories	040
6. Long - term assets held for sales	041	209,712,370	201.915.918
7. Biological asserts	042
IL RECEIVABLES (044 to 049)	043	574,902,573	685 666 821
1. Receivables from related parties	044	969 862 905	417,814,808
2. Accounts receivable	045	176.805.430	222.249.983
3. Receivables from participating parties	046	Ø.
4. Receivables from employees and members of related perties	047	568.443	542.116
	DAR	5.205.821	481, 968
5. Receivables from government and other institutions. 6. Other receivables		52,808,874	24.375.622
	049	67,652,100
III: SHORT TERM FINANCIAL: ASSETS (051 to 057)	nso.		216 802 957
1. Shares (stocks) in related parties.	051	31.DDD	20,000
2. Loans given to related serties.	052	54,673,815	(9) 164, (9) 8
3. Participating interests (shares)	053		Ŭ.
4. Loans to entrepreneurs in whom the entity holds participating interests	DS4		o
5 Investments in securities	056	476,000	1.007.580
6. L'oans, deposits, etc.	056	5:483.53%	148, 004, 552
7. Other financial assetts	057		91.357
IV, CASH AT BANK AND IN CASHIER	DISR	88.785.615	202.002.017
DI PREPAID EXPENSES AND ACCRUED REVENUE	059	8.498.397	63,584,478
E) TOTAL ASSETS (001+002+034+059)	DSD:	2.562.722.165	3.131.751.345
FL OFF-RALANCE RECORDS	081	606,580,439	685.791.281

Obligator: Podravka prehrambena industrila d.d., Koprivnica
Hom.	ADP code	Limit your (reet)	Current year (met)
喇	罩	а	省
LIABILITIES AND CAPITAL
CAPITAL: AND RESERVES (063+064+066+071+072+075+070) M.	662	1.337.863.000	1.030.103.175
I, SUBSCRIBED CAPITAL	663	1.084.000.000	1,588,493,693
II. CAPITAL RESERVES	064	46.763.761	176,897,463
IL RESERVES FROM PROFIT (050+067-058+059+070	065	6,623,319	50,388,561
1. Receives prescribed by low	696	2,568,306	12,651,998
2. Reserves for treasury shares	667	67,804,889	147.004.002
3. Treessury stocks and shares (deduction).	068	AT RIVERS	67.015.031
4. Statutory reserves	669
5. Other reserves	070	2,955,007	6.145.092
IV. REVALUATION RESERVES	071	O
V. RETAINED FARNINGS OR ACCUMULATED LOSS (073-074)	072	982,407	002.407
1: Retained earnings	673.	983,407	9/12/407
2. Accumulated loss	074	ñ
VI. PROFITA OSS FOR THE CURRENT YEAR 1076-077	675	201.073.837	95.515.084
1. Profit for the current year.	076	201.673.637	95.516.084
2. Loss for the current year.	677	o	ū
DC MINORITY INTERESTS	看天眼	ń	ò
B) PROVISIONS (688 to 682)	879	30.539.209	28,496,962
1. Provisions for pensions, severance pey, and similar liabilities	680	14.491.886	14,480,600
2. Reconvers for the liabilities	001
3. Other reserves	082	16.070.489	14.036.162
C) LONG - TERM LIABILITIES (664 to 092)	083	004-006-2009	599 SM 315
1. Liabilities to related parties	004
2. Liabilities for loans, deposits etc.	685		'n
3. Liabilities to banks and other financial institutions	赤向田	894, RFG, 322	599.551.515
4. Liabilities for received prepayments	687	¢	Ď
5. Accounts pavable	698	D.	D
6. Liabilities arising from debt securities	489	$\ddot{\phantom{a}}$	Ŭ.
7. Liabilities to entrepreneurs in whom the entity holds participati	698	ö	Ď
8. Other long-term liabilities	通信性	ö	ö
9. Deferred tax liability	892	ö	ñ
D) SHORT - TERM LIABILITIES (094 to 105)	803	433,588,131	530, 547,680
1. Liabilities to related parties.	694	50,437,132	20.187.018
2. Liabilities for loans, deposits etc.	095	429.443	428.179
3. Liabilities to benks and other financial institutions.	0.08	173, 291, 916	228,396,426
4. Liabilities for received preparements	897	m	38.160
	698	214, 411, 372	224,855,685
5. Accounts payable 6. Liabilities arbing from debt securities	\$99		ũ
7. Lisbilities to entrepreneurs in whom the entity holds participating interests	100		b
		28.770.202
8. Liabilities to employees	101	1.843.268	29,609,906 11,723,088
9. Liabilities for taxes, contributions and similar fees.	102 103
10. Liabilities to share - holders 11 Listvilliers for innovatoron asserts held for sale.		670,865 O.	816,888
	184		D.
12. Other short - term liebilities	105	3,367,841	7,644,571
E) DEFFERED SETTLEMENTS OF CHARGES AND INCOME DEFERRED TO FUTURE PERIOD	108	48,444,505	47.272.213
F) TOTAL - CAPITAL AND LIABILITIES (662+079+083+693+106)	107	3.582.733.165	3.131.751.345
OI OFF-BALANCE RECORDS	108	608580-439	686,781,281
APPENDIX to balance sheetito be filled in by entrepreneur that prepares consolidated annual financial report)
CAPITAL AND RESERVES
1. Attributed to equity holders of perent company.	109	Ü	õ
2. Attributed to minority interest	110	D.	Ø.

Rent	AOP code	East year	Crimetrit year
	z	α	4
CASH FLOW FROM OPERATING ACTIVITIES
1. Profit before tax	001	88.931.536	110.795.976
2. Depreciation	002	55.664.131	59.216.215
3. Increase in short term liabilities	003	11.234.006	30.208.265
4. Decrease in short term receivables	004		ň
5. Decrease in inventories	005		ŭ.
6. Other increase in cash flow	006	9.946.103	9.408.304
I. Total increase in cash flow from operating activities (001 to 006)	007	165,765,576	209.628.760
1. Decrease in short term liabilities	008
2. Increase in short term receivables	009	44.371.npm	144.040.379
3. Increase in inventories	010	71,083,302	36.894.359
4. Other decrease in cash flow	011	20.692.417	47.720.064
II. Total decrease in cash flow from operating activities (008 to 011)	012	136.147.527	228, 654, 702
A1) NET INCREASE IN CASH FLOW FROM OPERATING ACTIVITIES (007-012)	013	29.618.049
A2) NET DECREASE IN IN CASH FLOW FROM OPERATING ACTIVITIES (012-007)	014	f1	19.026.032
CASH FLOW FROM INVESTING ACTIVITIES
1. Cash inflows from sales of long-term tangible and intangible assets	015	4,758,470	4.575,640
2. Cash inflows from sales of equity and debt instruments	016		295.738.325
3. Interests receipts	017	4,994,653	6.136.911
4. Dividend receipts	018		n.
5. Other cash inflows from investing activities	019	14.248.472	16,689,746
III. Total cash inflows from investing activities (015 to 019)	020	24.001.505	323.140.623
1. Cash outliow for purchase of long-term tangible and intangible assets	021	89.479.476	68.029.445
2. Cash outflow for acquisition of equity and debt financial instruments	022	18.399	423.498.081
3. Other cash outflow for investing activities	023	29.344.556	51,483,365
IV. Total cash outflow for investing activities (021 do 023)	024	118.842.431	543,010,802
B1) NET INCREASE IN CASH FLOW FROM INVESTING ACTIVITIES (020-024)	025	$\overline{1}$
B2) NET DECREASE IN CASH FLOW FROM INVESTING ACTIVITIES (024-020)	026	94, 840, 838	219.670.269
CASH FLOW FROM FINANCIAL ACTIVITIES
1. Cash inflow from issuing property and debt financial instruments	027		506.393.995
2. Proceeds from the credit principal, promissory notes, borrowings and other loans	028	885,235.745	146.151.728
3. Other proceeds from financial activities	029		3.011.260
V. Total cash inflows from financial activities (027 to 029)	030	885, 235, 745	655, 556, 953
1. Cash outflow for repayment of credit principal and bonds	031	653.068.257	218.461.391
2. Cash outflow for dividends paid	032
3. Cash outflow for financial lease	033	526,605	550.581
4. Cash outflow for purchase of treasury shares	034		3.571,609
5. Other cash outflow for financial activities	035
VI. Total cash outflow for financial activities (031 to 035)	036	853,504,862	222.583.481
C1) NET INCREASE IN CASH FLOW FROM FINANCIAL ACTIVITIES (030-036)	037	31.640.883	-432.973.503
C2) NET DECREASE IN CASH FLOW FROM FINANCIAL ACTIVITIES (036-030)	$0.3 - 8$
Total increase in cash flow (013 - 014 + 025 - 026 + 037 - 038)	039
Total decrease in cash flow (014 - 013 + 026 - 025 + 038 - 037)	040		194,077,202
Cash and cash equivalents at the beginning of the period	041	33,581,904 72,907,990
increase of cash and cash equivalents	042		88,785,415
Decrease of cash and cash equivalents	043	33,581.904	194.077.202
Cash and cash equivalents at the end of the period	044
		30,326,086	282, N2 817

Nem		Lost year.	Current year
	$\overline{2}$		M
1. Subscribed capital	801	1.084.000.000	1.566.400.666
2. Capital reserves	882	46.783.751	176,897,483
3. Reserves from profit	003	6.423.313	99.386.001
4. Retained earnings or accumulated loss.	nna.	902-807	1002407
5. Profit or loss for the current year	005	201.673.837	95.516,084
6. Revaluation of long - term tangible assets	006
7. Revaluation of intengible assets	007
8. Revaluation of financial assets available for sale	GOR
9. Other reveluation	009
10. Total capital and reserves (AOP 001 do 009)	040	1,337,963,988	1,939.1
11. Currency gains and losses arising from net investern	011
12. Current and deferred taxes (part)	842
13. Cash flow hedging	013
14. Changes in accounting policy	014
15. Correction of significant errors in prior period	015
16. Other changes of capital	016	303.654.389	RD1 238 263
17. Total increase or decrease in capital (AOP 011 do 016)	017	203.554.382	001.239.207
17. a. Attributed to equity holders of parent company	018
17 b. Attributed to minority interest	019

Notes to the financial statements:

Accounting policies in year 2015 did not change.

STATEMENT FROM EXECUTIVES RESPONSIBLE FOR PREPARING FINANCIAL STATEMENTS

Koprivnica, 27 October 2015

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