Podravka d.d. — Interim / Quarterly Report 2019

Feb 28, 2020

Koprivnica, 28 February 2020

PODRAVKA INC. BUSINESS RESULTS FOR 1-12 2019 PERIOD

Content:

• General information
• Management report on the achieved business results of Podravka Inc. for the 1-12 2019 period
• Unaudited, unconsolidated financial reports for the 1-12 2019 period
• Statement from executives responsible for preparing financial statements
• Contact

General information

Podravka prehrambena industrija Inc., 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 food products.

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

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

Management Board members as at 31 December 2019

President	Marin Pucar
Member	Ljiljana Šapina
Member	Davor Doko
Member	Hrvoje Kolarić
Member	Marko Đerek

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

Koprivnica, 28 February 2020

MANAGEMENT REPORT ON THE ACHIEVED BUSINESS RESULTS OF PODRAVKA INC. FOR THE 1-12 2019 PERIOD

Key business highlights of the 1-12 2019 period

In the 1-12 2019 period, Podravka Inc. recorded operating income of HRK 2,097.7m, which is 8.0% higher than in the comparative period. Sales revenues increased as a result of stronger selling and marketing activities, demand for newly launched products and distribution expansion of certain categories. Total operating expenses are 8.2% higher due to an increase in material costs, following higher sales and the increase in staff costs as a result of the planned improvement of employees' material rights. This resulted in positive HRK 115.2m of operating profit, while in the comparative period it amounted to HRK 111.0m.

In 1-12 2019, finance income reached HRK 51.2m, with HRK 11.3m of finance costs, while the effective tax rate was 6.4%. Profit for the period in 1-12 2019 amounted to HRK 145.2m.

As at 31 December 2019, total assets of Podravka Inc. amounted to HRK 3,042.7m and was 1.6% higher than at the end of 2018. The significant increase on the assets side was in noncurrent financial assets (HRK +70.7m), mainly affected by HRK 39.2m increase in investments in shares of undertakings within the group following the recapitalization of Mirna Inc. and the increase in other non-current financial assets following the reclassification of receivables from the Fortenova Group (former Agrokor concern) to non-current financial assets. Receivables from undertakings within the group increased due to higher realisation of sales to related companies, while trade receivables decreased following, among other things, reclassification of receivables from the Fortenova Group (former Agrokor concern) to non-current financial assets. The line items cash at bank and in hand is HRK 66.0m lower than in the comparative period. On the equity and liabilities side, the most significant increase was recorded in line items profit for the year and reserves from profit, while the most significant decrease was recorded by trade payables and items related to liabilities to undertakings within the group.

Cash flow from operating activities in 1-12 2019 amounted to positive HRK 92.3m, as a result of operations and movements in the working capital. Cash flow from investing activities at the same time amounted to negative HRK 57.7m, primarily due to cash outflow for the purchase of non-current tangible and intangible assets. In the same period, cash flow from financing activities amounted to negative HRK 100.5m in relation to the comparative period due to the repayment of a portion of borrowings and the dividend distribution. In the 1-12 2019 period, cash at bank and in hand decreased by HRK 66.0m, and consequently the amount of cash and cash equivalents as at 31 December 2019 was HRK 2.2m.

UNAUDITED, UNCONSOLIDATED FINANCIAL REPORTS FOR THE 1-12 2019 PERIOD

Annex 1		ISSUER'S GENERAL DATA
Reporting period:		01.01.2019. to	31.12.2019.
Year:	2019
Quarter:	4
	Quarterly financial statements
egistration number (MB):	03454088	Issuer's home Member State code:	HR
Entity's registration number (MBS):	010006549
Personal identification number (OIB):	18928523252		LEI: 549300 TMC6BYESPQ7W85
Institution code:	1627
	Name of the issuer PODRAVKA prehrambena industrija d.d., KOPRIVNICA
Postcode and town:	48000		KOPRIVNICA
	treet and house number: ANTE STARCEVIĆA 32
	E-mail address: podravka@podravka.hr
	Web address: www.podravka.com
Number of employees (end of the reporting	3466
Consolidated report:	KN	(KN-not consolidated/KD-consolidated)
Audited:	RN	(RN-not audited/RD-audited)
	Names of subsidiaries (according to IFRS):		Registered office:	MB:
Bookkeeping firm:	No (Yes/No)
	Contact person: Artner Kukec Julijana (only name and surname of the contact person)		(name of the bookkeeping firm)
	Telephone: 048 653 055
	E-mail address: Julijana.ArtnerKukec@podravka.hr
	Audit firm: Ernst & Young d.o.o. (name of the audit firm)

Submitter: PODRAVKA prehrambena industrija d.d., KOPRIVNICA
Item	ADP code	Same period of the previous year		Current period
1	2	Cumulative 3	Quarter 4	Cumulative 5	Quarter 6
I OPERATING INCOME (ADP 126 to 130)	125	1.942.532.690	497.047.610	2.097.698.412	528.541.635
1 Income from sales with undertakings within the group	126	734.917.255	195.563.865	824.830.648	205.958.327
2 Income from sales (outside group)	127	1.202.184.796	299.773.238	1.253.973.139	306.778.292
3 Income from the use of own products, goods and services	128	0	0	0	0
4 Other operating income with undertakings within the group	129	296.698	-1.826.439	4.986	0
5 Other operating income (outside the group)	130	5.133.941	3.536.946	18.889.639	15.805.016
II OPERATING EXPENSES (ADP
132+133+137+141+142+143+146+153)	131	1.831.515.193	539.929.908	1.982.529.367	558.276.213
1 Changes in inventories of work in progress and finished goods	132	1.028.538	15.193.128	-23.710.749	5.096.688
2 Material costs (ADP 134 to 136)	133	1.253.310.154	339.774.226	1.392.141.233	364.009.024
a) Costs of raw materials and consumables	134	783.874.165	193.597.207	873.834.192	216.890.052
b) Costs of goods sold	135	279.975.344	72.445.845	319.018.085	65.744.994
c) Other external costs	136	189.460.645	73.731.174	199.288.956	81.373.978
3 Staff costs (ADP 138 to 140)	137	406.999.963	116.515.631	432.528.824	118.266.616
a) Net salaries and wages	138	272.139.437	82.771.210	296.982.610	84.737.396
b) Tax and contributions from salary costs	139	83.332.703	20.806.446	85.760.455	21.091.292
c) Contributions on salaries	140	51.527.823	12.937.975	49.785.759	12.437.928
4 Depreciation	141	87.898.120	23.087.196	97 488.689	24.545.508
5 Other costs	142	41.575.452	12.951.351	46.158.375	13.717.942
6 Value adjustments (ADP 144+145)	143	16.819.206	15,372,658	17.653.745	15.184.243
a) fixed assets other than financial assets	144	4.809.143	4.809.143	14.144.873	14.144.873
b) current assets other than financial assets	145	12.010.063	10.563.515	3.508.872	1.039.370
7 Provisions (ADP 147 to 152)	146	0	0	0	0
a) Provisions for pensions, termination benefits and similar obligations	147	0	0	0	0
b) Provisions for tax liabilities	148	0	0	0	0
c) Provisions for ongoing legal cases	149	0	0	0	0
d) Provisions for renewal of natural resources	150	0	0	0	0
e) Provisions for warranty obligations	151	0	0	0	0
f) Other provisions	152	0	0	0	0
8 Other operating expenses	153	23.883.760	17.035.718	20.269.250	17.456.192
III FINANCIAL INCOME (ADP 155 to 164)	154	34.671.782	2.247.281	51.159.472	583.402
1 Income from investments in holdings (shares) of undertakings within
the group	155	21.629.917	0	45,857,357	0
2 Income from investments in holdings (shares) of companies linked by virtue of participating interests	156	0	0	0	0
3 Income from other long-term financial investment and loans granted to undertakings within the group	157	0	0	0	0
4 Other interest income from operations with undertakings within the group	158	6.407.603	1.462.098	4.739.474	1.177.826
5 Exchange rate differences and other financial income from operations with undertakings within the group	159	0	0	0	0
6 Income from other long-term financial investments and loans	160	141.934	4.436	18.514	0
7 Other interest income	161	262.882	63.537	154.172	67.280
8 Exchange rate differences and other financial income	162	5.229.600	440.281	0	-661.704
9 Unrealised gains (income) from financial assets	163	999.846	276.929	389.955	0
10 Other financial income	164	0	0	0	0
IV FINANCIAL EXPENSES (ADP 166 to 172)	165	14,485,204	2.865.705	11.276.741	3.524.407
1 Interest expenses and similar expenses with undertakings within the group	166	5.708.217	1.326.861	4 495.159	922 267
2 Exchange rate differences and other expenses from operations with undertakings within the group	167	0	0	0	0
3 Interest expenses and similar expenses	168	7.154.537	1.538.844	5.258.779	1.163.932
4 Exchange rate differences and other expenses	169	0	0	966.951	966.951
5 Unrealised losses (expenses) from financial assets	170	0	0	555.852	471.257
6 Value adjustments of financial assets (net)	171	0	0	0	0
7 Other financial expenses	172	1.622.450	0	0	0
SHARE IN PROFIT FROM UNDERTAKINGS LINKED BY VRITUE V	173
OF PARTICIPATING INTERESTS VI SHARE IN PROFIT FROM JOINT VENTURES	174	0 0	0 0	0 0	0 0
VII SHARE IN LOSS OF COMPANIES LINKED BY VIRTUE OF
PARTICIPATING INTEREST	175	0	0	0	0
VIII SHARE IN LOSS OF JOINT VENTURES	176	0	0	0	0
IX TOTAL INCOME (ADP 125+154+173 + 174)	177	1.977.204.472	499.294.891	2.148.857.884	529.125.037
X TOTAL EXPENDITURE (ADP 131+165+175 + 176)	178	1.846.000.397	542.795.613	1.993.806.108	561.800.620
XI PRE-TAX PROFIT OR LOSS (ADP 177-178)	179	131.204.075	-43.500.722	155.051.776	-32.675.583
1 Pre-tax profit (ADP 177-178)	180	131.204.075	0	155.051.776	0
2 Pre-tax loss (ADP 178-177)	181	0	-43.500.722	0	32.675.583
XII INCOME TAX	182	18.062.749	-11.970.604	9.862.672	-16.311.083
XIII PROFIT OR LOSS FOR THE PERIOD (ADP 179-182)	183	113.141.326	-31.530.118	145.189.104	-16.364.500
1 Profit for the period (ADP 179-182)	184	113.141.326	0	145.189.104
2 Loss for the period (ADP 182-179)	185	0	31.530.118	0	-16.364.500

PODRAVKA Inc., Koprivnica, Ante Starčevića 32, The Commercial Court in Bjelovar, 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: Ž. Vukina, President of the Management Board: M. Pucar, members of the Management Board: D. Doko, H. Kolarić, Lj. Šapina, M. Đerek

MANAGEMENT BOARD

Same period of the previous year ADP Item		Current period
	code	Cumulative	Quarter	Cumulative	Quarter
1	2	3	A	5	6
DISCONTINUED OPERATIONS (to be filled in by undertakings subject to IFRS only with discontinued operations)
XIV PRE-TAX PROFIT OR LOSS OF DISCONTINUED OPERATIONS (ADP 187-188)	186		0	0	0
1 Pre-tax profit from discontinued operations	187	0	0	0	0
2 Pre-tax loss on discontinued operations	188	0	0	0	0
XV INCOME TAX OF DISCONTINUED OPERATIONS	189	0	0	0	0
1 Discontinued operations profit for the period (ADP 186-189)	190	0	0	0	0
2 Discontinued operations loss for the period (ADP 189-186)	191		0	0	0
TOTAL OPERATIONS (to be filled in only by undertakings subject to IFRS with discontinued operations)
XVI PRE-TAX PROFIT OR LOSS (ADP 179+186)	192		0	0	0
1 Pre-tax profit (ADP 192)	193	0	0	0	0
2 Pre-tax loss (ADP 192)	194	0	0	0	0
XVII INCOME TAX (ADP 182+189)	195	0	0	0
XVIII PROFIT OR LOSS FOR THE PERIOD (ADP 192-195)	196		0	0	0
1 Profit for the period (ADP 192-195)	197		0	0	0
2 Loss for the period (ADP 195-192)	198		0	0	0
APPENDIX to the P&L (to be filled in by undertakings that draw up consolidated annual financial statements)
XIX PROFIT OR LOSS FOR THE PERIOD (ADP 200+201)	199		0	0	0
1 Attributable to owners of the parent	200	0	0	0	0
2 Attributable to minority (non-controlling) interest	201	0	0	0	0
STATEMENT OF OTHER COMPRHENSIVE INCOME (to be filled in by undertakings subject to IFRS)
I PROFIT OR LOSS FOR THE PERIOD	202	113.141.326	-31.530.118	145.189.104	-16.364.500
II OTHER COMPREHENSIVE INCOME/LOSS BEFORE TAX (ADP 204 to 211)	203	258.798	258.798	-639.514	-639.514
1 Exchange rate differences from translation of foreign operations	204	0	0	0	0
2 Changes in revaluation reserves of fixed tangible and intangible assets	205	0	0	0	0
3 Profit or loss arising from subsequent measurement of financial assets available for sale	206	0	0	0
4 Profit or loss arising from effective cash flow hedging	207	0	0	0	0
5 Profit or loss arising from effective hedge of a net investment in a foreign operation	208	0	0	0	0
6 Share in other comprehensive income/loss of companies linked by virtue of participating interests	209	0	0	0	0
7 Actuarial gains/losses on the defined benefit obligation	210	258.798	258.798	-639.514	-639.514
8 Other changes in equity unrelated to owners	211	0	0	0	0
III TAX ON OTHER COMPREHENSIVE INCOME FOR THE PERIOD	212	0	0	0	0
IV NET OTHER COMPREHENSIVE INCOME OR LOSS (ADP 203-212)	213	258.798	258.798	-639.514	639.514
V COMPREHENSIVE INCOME OR LOSS FOR THE PERIOD (ADP 202+213)	214	113.400.124	-31.271.320	144.549.590	-17.004.014
APPENDIX to the Statement on comprehensive income (to be filled in by undertakings that draw up consolidated statements)
VI COMPREHENSIVE INCOME OR LOSS FOR THE PERIOD (ADP 216+217)	215	()	0	0	0
1 Attributable to owners of the parent	216	0	0	0	0
2 Attributable to minority (non-controlling) interest	217	0	0	0	0

Submitter: PODRAVKA prehrambena industrija d.d., KOPRIVNICA
Item	ADP code	Last day of the preceding business year	At the reporting date of the current period
	2	8	4
A) RECEIVABLES FOR SUBSCRIBED CAPITAL UNPAID	001	0	0
B) FIXED ASSETS (ADP 003+010+020+031+036)	002	2 001 729 016	2.092.574.121
I INTANGIBLE ASSETS (ADP 004 to 009)	003	83.550.892	84.738.126
1 Research and development	004	0	0
2 Concessions, patents, licences, trademarks, software and other	005	82.012.693	77.936.646
rights
3 Goodwill	006	0	0
4 Advances for the purchase of intangible assets 5 Intangible assets in preparation	007 008	0 1.538.199	0 6.801.480
6 Other intangible assets	009	0	0
II TANGIBLE ASSETS (ADP 011 to 019)	010	943 805 990	948.017.022
1 Land	011	45.420.448	57.909.131
2 Buildings	012	439.398.478	422.475.282
3 Plant and equipment	013	251.921.501	269.997.957
4 Tools, working inventory and transportation assets	014	24.059.994	41.112.287
5 Biological assets	015	0
6 Advances for the purchase of tangible assets 7 Tangible assets in preparation	016 017	285.258 60.854.260	3.765.153 42.757.212
8 Other tangible assets	018	0	C
9 Investment property	019	121.866.051	110.000.000
III FIXED FINANCIAL ASSETS (ADP 021 to 030)	020	944.698.747	1.015.430.473
1 Investments in holdings (shares) of undertakings within the group	021	939.068.333	978.278.607
2 Investments in other securities of undertakings within the group	022	0	0
3 Loans, deposits, etc. to undertakings within the group	023	5.283.130	0
4. Investments in holdings (shares) of companies linked by virtue of	024	0	0
participating interests
5 Investment in other securities of companies linked by virtue of participating interests	025	0	0
6 Loans, deposits etc. to companies linked by virtue of participating
interests	026	0	0
7 Investments in securities	027	140.500	532.554
8 Loans, deposits, etc. given	028	206.784	221.769
9 Other investments accounted for using the equity method 10 Other fixed financial assets	029 030	0 0	0 36.397.543
IV RECEIVABLES (ADP 032 to 035)	031	0	0
1 Receivables from undertakings within the group	032	0	0
2 Receivables from companies linked by virtue of participating
interests	033	0	0
3 Customer receivables	034	0	0
4 Other receivables	035	0	0
V DEFERRED TAX ASSETS	036	29.673.387	44.388.500
C) CURRENT ASSETS (ADP 038+046+053+063)	037	987.808.110	947.046.055
I INVENTORIES (ADP 039 to 045)	038	369.330.573	438.975.867
1 Raw materials and consumables	039	140.914.574	146.148.219
2 Work in progress 3 Finished goods	040 041	27.699.930 154.115.542	26.275.145 177.289.102
4 Merchandise	042	45.525.456	88.188.330
5 Advances for inventories	043	0	0
6 Fixed assets held for sale	044	1.075.071	1.075.071
7 Biological assets	045	0	C
II RECEIVABLES (ADP 047 to 052)	046	488.945.847	480.552.184
1 Receivables from undertakings within the group	047	280.402.726	290.484.997
2 Receivables from companies linked by virtue of participating interests	048	0
3 Customer receivables	049
4 Receivables from employees and members of the undertaking	050	200.165.109 512.864	184.596.116 920.073
5 Receivables from government and other institutions	051	7.737.922	4.357.997
6 Other receivables	052	127.226	193.001
III CURRENT FINANCIAL ASSETS (ADP 054 to 062)	053	61.365.185	25,337,630
1 Investments in holdings (shares) of undertakings within the group	054	0	0
2 Investments in other securities of undertakings within the group	055	0	0
3 Loans, deposits, etc. to undertakings within the group	056	61.069.475	25.330.884
4 Investments in holdings (shares) of companies linked by virtue of	057	0	0
participating interests
5 Investment in other securities of companies linked by virtue of	058	0	0
participating interests 6 Loans, deposits etc. to companies linked by virtue of participating
interests	059	0	0
7 Investments in securities	060	295.710	6.746
8 Loans, deposits, etc. given	061	0	0
9 Other financial assets	062	0	0
IV CASH AT BANK AND IN HAND	063	68.166.505	2.180.374
D ) PREPAID EXPENSES AND ACCRUED INCOME	064	4.510.408	3.046.938
E) TOTAL ASSETS (ADP 001+002+037+064) OFF-BALANCE SHEET ITEMS	065 066	2.994.047.534 1.048.180.995	3.042.667.114 964.208.349

PODRAVKA Inc., Koprivnica, Ante Starčevića 32, The Commercial Court in Bjelovar, 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: Ž. Vukina, President of the Management Board: M. Pucar, members of the Management Board: D. Doko, H. Kolarić, Lj. Šapina, M. Đerek

II CAPITAL RESERVES	069	177.874.586	178.030.772
III RESERVES FROM PROFIT (ADP 071+072-073+074+075)	070	328.057.266	383.120.276
1 Legal reserves	071	30.947.466	36.604.533
2 Reserves for treasury shares	072	147.604.502	147.604.502
3 Treasury shares and holdings (deductible item)	073 074	-54.209.463	-47.568.237
4 Statutory reserves 5 Other reserves	075	0 203.714.761	0 246.479.478
IV REVALUATION RESERVES	076	0	0
V FAIR VALUE RESERVES (ADP 078 to 080)	077	0	0
1 Fair value of financial assets available for sale	078	0	0
2 Cash flow hedge - effective portion	079	0	0
3 Hedge of a net investment in a foreign operation - effective portion	080	0	0
VI RETAINED PROFIT OR LOSS BROUGHT FORWARD (ADP 082- 083)	081	3.696.000	4.868.475
1 Retained profit	082	3.696.000	4.868.475
2 Loss brought forward	083	0	0
VII PROFIT OR LOSS FOR THE BUSINESS YEAR (ADP 085-086)	084	113.141.326	145,189,104
1 Profit for the business year	085	113.141.326	145.189.104
2 Loss for the business year	086	0	0
VIII MINORITY (NON-CONTROLLING) INTEREST	087	0	0
B) PROVISIONS (ADP 089 to 094)	088	32.817.905	34.787.460
1 Provisions for pensions, termination benefits and similar obligations	089	19.811.677	21.975.417
2 Provisions for tax liabilities	090	0	0
3 Provisions for ongoing legal cases	091	13 006 228	12.812.043
4 Provisions for renewal of natural resources	092	0	0
5 Provisions for warranty obligations	093	0	0
6 Other provisions	094	0	0
C) LONG-TERM LIABILITIES (ADP 096 to 106)	095	181.202.712	179.850.124
1 Liabilities to undertakings within the group	096	0	0
2 Liabilities for loans, deposits, etc. of undertakings within the group	097	0	0
3 Liabilities to companies linked by virtue of participating interests	098	0	0
4 Liabilities for loans, deposits etc. of companies linked by virtue of	099	0	0
participating interests 5 Liabilities for loans, deposits etc.	100	0	0
6 Liabilities to banks and other financial institutions	101	181.202.712	179.850.124
7 Liabilities for advance payments	102	0	0
8 Liabilities to suppliers	103	0	0
9 Liabilities for securities	104	0	0
10 Other long-term liabilities	105	0	0
11 Deferred tax liability	106	0	0
D) SHORT-TERM LIABILITIES (ADP 108 to 121)	107	542.996.031	487.929.614
1 Liabilities to undertakings within the group	108	39.997.328	28.090.456
2 Liabilities for loans, deposits, etc. of undertakings within the group	109	29.670.300	9.461.512
3 Liabilities to companies linked by virtue of participating interests	110	0	0
4 Liabilities for loans, deposits etc. of companies linked by virtue of participating interests	111	0	0
5 Liabilities for loans, deposits etc	112	605.256	345.367
6 Liabilities to banks and other financial institutions	113	176.032.359	167.707.337
7 Liabilities for advance payments	114	0	0
8 Liabilities to suppliers	115	245.821.222	224.702.395
9 Liabilities for securities	116	25.228	292.116
10 Liabilities to employees	117	34.661.926	35.868.211
11 Taxes, contributions and similar liabilities	118	12.830.510	15.305.439
12 Liabilities arising from the share in the result	119	1.470.793	2.201.947
13 Liabilities arising from fixed assets held for sale	120	0	0
14 Other short-term liabilities	121	1.881.109	3.954.834
E) ACCRUALS AND DEFERRED INCOME	122	47.861.048	62.490.629
F) TOTAL - LIABILITIES (ADP 067+088+095+107+122)	123	2.994.047.534	3.042.667.114
G) OFF-BALANCE SHEET ITEMS	124	1.048.180.995	964.208.349

Submitter: PODRAVKA prehrambena industrija d.d., KOPRIVNICA
Item	ADP code	Same period of the previous year	Current period
	2	3	4
Cash flow from operating activities
1 Pre-tax profit	001	131.204.075	155.051.776
2 Adjustments (ADP 003 to 010):	002	100.181.345	82.618.371
a) Depreciation b) Gains and losses from sale and value adjustment of fixed tangible and	003	87.898.120	97.488.689
intangible assets	004	15.160.158	13.428.972
c) Gains and losses from sale and unrealised gains and losses and value	005	15.626.086	7.144.229
adjustment of financial assets d) Interest and dividend income	006	-28.321.319	-50.769.518
e) Interest expenses	007	12.862.755	9.753.937
f) Provisions	008	1.380.270	5.248.655
g) Exchange rate differences (unrealised)	009	-4.424.725	323.407
h) Other adjustments for non-cash transactions and unrealised gains and losses	010	0	0
I Cash flow increase or decrease before changes in working capital	011	231,385,420	237.670.147
(ADP 001+002)
3 Changes in the working capital (ADP 013 to 016)	012	-51.883 578	-113.611.975
a) Increase or decrease in short-term liabilities	013 014	-11.898.614	-19.927.146
b) Increase or decrease in short-term receivables c) Increase or decrease in inventories	015	-17.345.759 -22.639.205	-24.039.534 -69.645.295
d) Other increase or decrease in working capital	016	0	0
Il Cash from operations (ADP 011+012)	017	179.501.842	124.058.172
4 Interest paid	018	-13.589.038	-10.070.291
5 Income tax paid	019	-5.479.753	-21.700.037
A) NET CASH FLOW FROM OPERATING ACTIVITIES (ADP 017 to 019)	020	160.433.051	92.287.844
Cash flow from investment activities
1 Cash receipts from sales of fixed tangible and intangible assets	021	3.192.975	1.016.557
2 Cash receipts from sales of financial instruments	022	321.016	20.000
3 Interest received	023	5.080.022	355.528
4 Dividends received	024	20.918	15.870.931
5 Cash receipts from repayment of loans and deposits	025	36.231.438	297.160
6 Other cash receipts from investment activities	026	0	0
Ill Total cash receipts from investment activities (ADP 021 to 026)	027	44.846.369	17.560.176
1 Cash payments for the purchase of fixed tangible and intangible assets	028	-82.067.565	-68.999.558
2 Cash payments for the acquisition of financial instruments	029	0	0
3 Cash payments for loans and deposits for the period	030	-9.297.800	-2.458.755
4 Acquisition of a subsidiary, net of cash acquired	031	-399.512	-3.847.241
5 Other cash payments from investment activities	032	0	0
IV Total cash payments from investment activities (ADP 028 to 032)	033	-91.764.877	-75.305.554
B) NET CASH FLOW FROM INVESTMENT ACTIVITIES (ADP 027 +033)	034	-46.918.508	-57.745.378
Cash flow from financing activities
1 Cash receipts from the increase in initial (subscribed) capital	035	0	0
2 Cash receipts from the issue of equity financial instruments and debt financial instruments	036	0	0
3 Cash receipts from credit principals, loans and other borrowings	037	99.565.288	310.638.045
4 Other cash receipts from financing activities	038	2.091.950	6.129.558
V Total cash receipts from financing activities (ADP 035 to 038)	039	101.657.238	316.767.603
1 Cash payments for the repayment of credit principals, loans and other borrowings and debt financial instruments	040	-227.737.778	-343 284 947
2 Cash payments for dividends	041	-48.724.142	-62.176.755
3 Cash payments for finance lease	042	0	0
4 Cash payments for the redemption of treasury shares and decrease in	043	-2.557.031	0
initial (subscribed) capital 5 Other cash payments from financing activities	044	0	-11.834.498
VI Total cash payments from financing activities (ADP 040 to 044)	045	-279.018.951	-417.296.200
C) NET CASH FLOW FROM FINANCING AC TIVITIES (ADP 039 +045)	046	-177,361,713	-100.528.597
1 Unrealised exchange rate differences in respect of cash and cash equivalents	047	0	0
D) NET INCREASE OR DECREASE IN CASH FLOWS (ADP 020+034+046+047)	048	-63.847.170	65.986.131
E) CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE PERIOD	049	132.013.675	68.166.505
F) CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD(ADP 048+049)	050	68.166.505	2.180.374

STATEMENT OF CHANGES IN EQUITY
for the period from 1.1.2019 to	31.12.2019															in HRK
								Attributable to owners of the paren
	ADP	itial (supecuped) capital	Capital reserves	Legal reserves	RESERVES for	Treasury shares and holdings (deductible Statutory reserves		Other reserves	Revaluation	Fair value of financial assets available for sale	Cash flow hedge effective portion	Hedge of a net foreign operation - brought forward effective portion	investment in a Retained profit / loss	Profit/loss for the business year	tal attributable to wners of the pares	Almority (non	otal capital an reserves
1	2	m	4	5	ﯽ	-		ా	10 -	11	12	13	14	15	16 (3 to 6 - 7 + 8 to 15)	17	18 (16.17)
Previous period
1 Balance on the first day of the previous business year	01	1.566.400.660	182 267.472	26,625,605	147.604.502	60,502,679		171.180.626					88.995.306		2.122.571.492		2.122.571.492
2 Changes in accounting policies	02
3 Correction of errors	03
4 Balance on the first day of the previous business year (restated) (ADP 01 to 03)	04	1.566.400.660	182.267.472	26,625,605	147.604.502	60,502,679		171.180.626					88,995,306		2.122.571.492		2.122.571.492
5 Profit/loss of the period	05													113.141.326	113.141.326		113,141,326
6 Exchange rate differences from translation of foreign operations	06
7 Changes in revaluation reserves of fixed tangible and intangible assets	07
8 Profit or loss arising from subsequent measurement of financial assets available for	08
9 Profit or loss ansing from effective cash flow hedge	િતે
10 Profit or loss arising from effective hedge of a net investment in a foreign operation	10
11 Share in other comprehensive income/loss of companies linked by virtue of participating interests	11
12 Actuarial gains/losses on the defined benefit obligation	12							315.607							315,607		315.607
13 Other changes in equity unrelated to owners	13
14 Tax on transactions recognised directly in equity	14							-56.809							-56.809		-56.809
15 Increase/decrease in initial (subscribed) capital (other than from reinvesting proft and other than arising from the pre-bankruptcy settlement procedure)	15		4.392 886												-4.392 886		-4.392.886
16 Increase in initial (subscribed) capital arising from the reinvestment of profit	16
17 Increase in initial (subscribed) capital ansing from the pro-bankruptcy settlement procedure	17
18 Redemption of treasury shares/holdings	18					2.567.031									-2 567 031		-2.557.031
19 Payment of share in profit/dividend	19					-8.850.247							-48.702.108		-39.851.861		-39.851.861
20 Other distribution to owners	20
21 Transfer to reserves according to the annual schedule	21			4.321.861				32.275.337					-36.597.198
22 Increase in reserves arising from the pre-bankruptcy settlement procedure	22
23 Balance on the last day of the previous business year reporting period (04 to ZZ)	23	1.566.400.660	177.874.586	30.947.466	147.604.502	54,209,463		203.714.761					3.696.00	113.141.326	2.189.169.838		2.189.169.838
APPENDIX TO THE STATEMENT OF CHANGES IN EQUITY (to be filled in by undertakings that draw up financial statements in accordance with the FRS)
I OTHER COMPREHENSIVE INCOME OF THE PREVIOUS PERIOD, NET OF TAX (ADP 06 to 14)	24							258,798							258.798		258,796
II COMPREHENSIVE INCOME OR LOSS FOR THE PREVIOUS PERIOD (ADP 05+24)	25							258.798						113.141.326	113.400.124		113.400.124
III TRANSACTIONS WITH OWNERS IN THE PREVIOUS PERIOD RECOGNISED DIGECTLY IN FOUITY /ADD 16 to 22)	26		-4.392 886	4.321.861		-6.293.216		32.275.337					-85,299,300		-46.801.778		-46,801.778

PODRAVKA Inc., Koprivnica, Ante Starčevića 32, The Commercial Court in Bjelovar, 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: Ž. Vukina, President of the Management Board: M. Pucar, members of the Management Board: D. Doko, H. Kolarić, Lj. Šapina, M. Đerek

	ADP	Attributable to owners of the parent
		nitial (subscribed capital		Capital reserves Legal reserves	Reserves for treasury shares	Treasury shares and holdings (deductible Statutory reserves		Other reserves	Revaluation reserves	Fair value of inancial asset: available for sale	Cash flow hedge -	Hedge of a net effective portion	Investment in a Retained profit / loss Profit/loss for the effective portion foreign operation - brought forward	business year	otal attributable owners of the parent	inority (nor controllin neerest	Total capital and reserves
1		-	ব	5		1		9	10	11	12	13	14	15	16 (3 to 6 - 7 + 8 to 15)	STO	18 (16+17)
Current period
1 Balance on the first day of the current business year	27	1.566.400.660	177.874.586	30,947,466	147.604.502	54.209.463		203.714.761					116,837,326		2.189.169.838		2.189.169.83
2 Changes in accounting policies	28
3 Correction of errors	29
4 Balance on the first day of the current business year (restated) (ADP 27 to 29)	30	1.566.400.650	177,874,586	30,947,466	147,604,502	54,209,463		203.714.761					116,837,326		2.189.169.838		2.189.169.838
5 Profit/loss of the period	31													145.189.104	145,189,104		145,189,104
6 Exchange rate differences from translation of foreign operations	32
? Changes in reserves of fixed tangible and in and in a agent in essess	33
3 Profit or loss arising from subsequent measurement of financial assets available for	34
9 Profit or loss ansing from effective cash flow hedge	35
10 Profit or loss ansing from effective hedge of a net investment in a foreign operation	36
11 Share in other comprehensive income/loss of companies linked by vitue of participating interests	37
12 Actuarial gains/losses on the defined benefit obligation	38							-779,896							-779.896		-779.89
13 Other changes in equity unrelated to owners	39
14 Tax on transactions recognised directly in equity	40							140.381							140.381		140.38
15 Increase/decrease in initial (subscribed) capital (other than from reinvesting profit and other than arising from the pre-bankruptcy settlement procedure)	41		156.186												156.186		156.18
16 Increase in intial (subscribed) capital ansing from the reinvestment of profit	42
17 Increase in intial (subscribed) capital arising from the pre-bankruptcy settlement procedure	43
18 Redemption of treasury shares/holdings	44
19 Payment of share in profit/dividend	45					-6.641.226							-62 907 552		-66.266.326		-56,266,32
20 Other distribution to owners	46 47
21 Transfer to reserves according to the annual schedule	48			5.657.067				43.404.232					-49.061.299
22 Increase in reserves arising from the pre-banksuptcy settlement procedure 23 Balance on the last day of the current business year reporting period (ADP
30 to 48)	49	1.566.400.660	178.030.772	36.604.533	147.604.502	47.568.237		246.479.478					4.868.475	145.189.104	2.277.609.287		2.277.609.287
APPENDIX TO THE STATEMENT OF CHANGES IN EQUITY (to be filled in by undertakings that draw up financial statements in accordance with the FFS)
I OTHER COMPREHENSIVE INCOME FOR THE CURRENT PERIOD, NET OF TAX (ADP 32 to 40)	50							-639.515							-639.616		-639.515
II COMPREHENSIVE INCONE OR LOSS FOR THE CURRENT PERIOD (ADS 31+50)	51							-639.616						145.189.104	144.549.589		144.549.589
III TRANSACTIONS WITH OWNERS IN THE CURRENT PERIOD RECOGNISED DIRECTLY IN EQUITY (ADP 41 to 48)	52		156.186	5.657.067		-6.641.226		43.404.232					-111.968.85		-56.110.140		-56.110.140

Notes to the financial statements:

From 1 January 2019 Podravka Inc. applies IFRS 16 Leases. According to new standard, Podravka Inc. recognises right-of-use assets based on cost method, and leases liability in amount of present value of minimum future lease payments. Exceptions from this recognition is applied for short term leases and leases of low value asset. Right-of-use asset is depreciated by the end of asset's useful life, and lease liabilities are measured at the effective interest rate method. In the statement of financial position, right-of-use assets are included within long term tangible asset and lease liabilities are reported within long term and short-term liabilities. As at 31 December 2019 value of Podravka Inc. right-of-use asset amounts to HRK 36.8 mil. and lease liabilities amounts to HRK 37.7 mil.

STATEMENT FROM EXECUTIVES RESPONSIBLE FOR PREPARING FINANCIAL STATEMENTS

Koprivnica, 28 February 2020

Contact

Podravka Inc. Ante Starčevića 32, 48 000 Koprivnica, Croatia www.podravka.hr

Investor relations e-mail: ir@podravka.hr Tel: +385 48 65 16 35