8. LIMITATION ON TRANSFERENCE OF SECURITIES: 5
9. SHAREHOLDERS 5
10. SHAREHOLDERS' RIGHTS 7
11. SHAREHOLDERS WITH SPECIAL CONTROL RIGHTS AND DESCRIPTION OF THE RIGHTS. 7
12. OVERALL LIMITATIONS OF VOTING RIGHTS. 8
13. OVERALL AGREEMENTS BETWEEN SHAREHOLDERS. 8
14. EMPLOYEES 8
15. PROCEDURE FOR AMENDMENTS OF THE ARTICLES OF ASSOCIATION 10
16. TRANSACTIONS WITH RELATED PARTIES AND SIGNIFICANT AGREEMENTS 11
17. KEY CHARACTERISTICS OF THE SECURITIES LAUNCHED TO THE PUBLIC TRADING: 11
18. SECURITIES LISTED ON THE OFFICIAL TRADING LIST 11
19. CAPITALIZATION OF SECURITIES. 13
20. THE GROUP'S CONSOLIDATED AND PARENT COMPANY'S AUDITED FINANCIAL ACCOUNTS FOR THE YEAR 2012 16
21. INFORMATION ON PURCHASE OF ISSUER'S OWN SHARES 16
22. LEGAL GROUNDS OF THE ISSUER'S PERFORMANCE 16
23. BELONGING TO THE ASSOCIATED ORGANIZATIONS 16
24. BRIEF DESCRIPTION OF THE ISSUER'S HISTORY 16
25. PRODUCTION, DESCRIPTION OF PRODUCTION CAPACITIES, AND IMPLEMENTATION OF NEW PRODUCTS 19
26. SALES AND MARKETING 22
27. PURCHASE OF RAW MILK 25
28. RISK FACTORS RELATED WITH THE ISSUER'S PERFORMANCE. 26
29. KEY ASPECTS OF FORMATION OF CONSOLIDATED FINANCIAL ACCOUNTING RELATED WITH THE SYSTEMS OF INTERNAL CONTROL AND RISK MANAGEMENT 29
30. FINANCIAL RISK MONITORING 31
31. INFORMATION ABOUT THE AUTHORIZATION GIVEN BY THE BOARD MEMBERS 31
32. KEY RATIOS OF THE COMPANY PERFORMANCE, THEIR DYNAMICS 31
33. INVESTMENT PROJECTS IMPLEMENTED DURING THE LAST 3 FISCAL YEARS: 32
34. FUTURE PLANS, FORECASTS AND INVESTMENTS ENVISAGED IN 2013 34
35. DIVIDENDS PAID 34
36. MANAGEMENT BODIES OF THE ISSUER 35
37. COMMITTEES FORMED IN THE COMPANY 36
38. MANAGEMENT BODIES 37
39. MEMBERS OF COLLEGIAL BODIES 37
40. INFORMATION ON OBSERVANCE OF THE COMPANY MANAGEMENT CODEX. 40
41. INFORMATION ON THE PUBLICLY ANNOUNCED DATA 40
42. INFORMATION ON THE PUBLICLY ANNOUNCED DATA AFTER THE END OF FISCAL YEAR 43
43. INFORMATION ON AUDIT 43
44. PERFORMANCE STRATEGY AND EVALUATED CHANGES IN THE NEAREST FISCAL YEAR 43

1. Reporting term of the prepared annual report.

The consolidated annual report is prepared for the year 2012.

2. Key information of the issuer:

Name of the issuer: Joint stock Company "Rokiskio suris". Legal base: Joint Stock Company. Address – Pramones str. 3, LT 42150 Rokiskis, Republic of Lithuania. Telephone: +370 458 55 200, fax +370 458 55 300. E-mail address: [email protected] Website: www.rokiskio.com Registered in on 28th February 1992 by the Authorities of Rokiskis region. Re-registered in on 28th November 1995 by the Ministry of Economy of the Republic of Lithuania. Company code 173057512. Manager of registry of legal entities – State company "Registru centras". The authorized capital of AB "Rokiskio suris" equals to LTL 35,867,970. There are 35,867,970 shares. Nominal value per share equals to LTL 1 (one litas).

3. Information on the issuer's daughter enterprises and subsidiaries

As at 31st December 2012, the consolidated group (hereinafter the "Group") consists of the Parent Company AB "Rokiskio suris", two branches, four subsidiaries and one joint venture. The following tables introduce the subsidiaries and branches:

	Actively performing as at 31st December 2012				Share of the group (%) as at 31st December 2012
Branches	2012	2011	Subsidiaries	2012	2011
Utenos pienas	Yes	Yes	UAB "Rokiškio pienas"	100.00	100.00
Ukmergės pieninė	Yes	Yes	PK "Žalmargė"	100.00	100.00
			SIA Jekabpils piena kombinats	100.00	100.00
			SIA Kaunata*	60.00	60.00
			Joint venture
			UAB "Pieno upės"	50.00	50.00

*- The subsidiaries are not consolidated with the Group due to their insignificance.

Subsidiaries of AB "Rokiškio sūris":

UAB "Rokiskio pienas" legal address: Pramonės g. 8, LT - 28216 Utena. Company code: 300561844. AB "Rokiškio sūris" is its founder and the only shareholder having 100 per cent of shares.

Dairy cooperative "Žalmargė" legal address: Kalnalaukio g.1, Širvintos. Company code: 178301073.

Latvian company SIA Jekabpils piena kombinats (company code 45402008851, legal address: Akmenu iela 1, Jekabpils, Latvija LV-5201).

SIA "Kaunata" was acquired on May 11th, 2010. The company is not consolidated in the financial account of the Group of AB "Rokiškio sūris" due to its insignificance, furthermore SIA Kaunata is not directly subordinate to AB "Rokiškio sūris" (there are no transactions between the companies).

Co-controlled company:

UAB "Pieno upės", legal address: Sandėlių g. 9, Kaunas. Company code: 135027862.

Branches of AB "Rokiškio sūris":

AB "Rokiškio sūris" branch Utenos pienas (Company code: 110856741, Pramonės g. 8, LT-28216 Utena);

AB "Rokiškio sūris" branch Ukmergės pieninė (Company code: 182848454, Kauno g. 51, LT-20119, Ukmergė).

4. Characterization of key operations of the issuer.

Basic business of the group of "Rokiškio sūris":

• Dairying and cheese production (EVRK 10.51);

Basic business of AB "Rokiškio sūris" is production and sales of fermented cheese, whey products, and skim milk powder.

Daughter enterprises:

Basic business of UAB "Rokiškio pienas" production and sales of fresh dairy products (fluid milk, kefir, sour milk, butter, curds, fresh cheese, sour cream, chocolate coated curds dessert, desserts). Basic business of KB "Žalmargė" is purchase of raw milk.

Basic business of SIA Jekabpils piena kombinats – production of fermented cheese and purchase of raw milk.

Basic business of SIA Kaunata – purchase of raw milk and transportation.

Co-controlled company:

Basic business of UAB "Pieno upės" is purchase of raw milk.

Branches of AB "Rokiškio sūris":

Basic business of AB "Rokiškio sūris" branches Utenos pienas and Ukmergės pieninė is purchase of raw milk.

5. Contracts with financial brokers

On 24th December 2003, AB "Rokiškio sūris" made a contract with UAB FMĮ "Baltijos vertybiniai popieriai" (Gedimino pr.60, Vilnius) regarding administration of shareholders of AB "Rokiškio sūris". On 15th January 2007, the financial company changed its name into UAB FMĮ "Orion securities" (A.Tumėno str. 4 , LT-01109 Vilnius).

6. Trade on issuer's securities by stock exchange and other organised markets

35,867,970 ordinary registered shares of AB "Rokiškio sūris". Nominal value per share LTL 1 (one litas). (VVPB symbol RSU1L; ISIN code – LT0000100372). Total nominal value equals to LTL 35,867,970.

AB "Rokiškio sūris" shares are traded on Vilnius Stock Exchange NASDAQ OMX, the shares are included on the Official Trading List. The Company was included on the trading lists on 25th July 1995.

The Company's shares are traded on the comparative index of Baltic countries in OMX Baltic Benchmark.

As from 22nd November 2010, trade by the Company's shares is made in euros on Stock Exchange NASDAQ OMX Vilnius.

7. Authorized capital of the issuer:

As at 31st December 2012, the Authorized capital of AB "Rokiškio sūris" comprised of:

Type of shares	Number of shares	Nominal value, LTL	Total nominal value, LTL	Share of authorized capital (%)
Ordinary registered shares	35,867,970	1	35,867,970	100.00

All shares of AB "Rokiškio sūris" are paid-up, and they are not subject to any limitations of transference.

8. Limitation on transference of securities:

There are no limitations to be applied to the block of shares or any regulations according to which an agreement with the company or other owners of securities is required.

9. Shareholders.

Total number of shareholders (as at 31.12.2012) – 5,683 shareholders.

Distribution of ownership according to holder groups

The shareholders having or owning over 5 percent of the issuer's authorized capital (as at 31.12.2012):

Name, surname Name of company	Address		Proprietary rights	With associated persons
		Number of shares	Share of the capital %	Share of votes %	Share of the capital %	Share of votes %
UAB "Pieno pramonės investicijų valdymas" Company code 173748857	Pramonės g. 3, Rokiškis Lithuania	14,022,173	39.09	39.99	68.70	70.27
Antanas Trumpa	Sodų 41a, Rokiškis Lithuania	8,240,053	22.97	23.50	68.70	70.27
East Capital Baltic Fund Company code 556546-8435	Box 364, 111 93 Stockholm, Sweden	2,142,884	5.97	6.11	-	-
Swedbank clients Company code 10060701	Liivalaia 8, Tallinn Estonia	2,506,617	6.99	7.15	-	-
AB "Rokiškio sūris" Company code 173057512	Pramonės g.3, Rokiškis Lithuania	802,094	2.24	-	-	-

10. Shareholders' rights

Shareholders have the following non-economic rights:

1) to attend the general meetings of shareholders;
2) to make advance inquiries addressed to the company in regards with the items on the agenda of general meeting of shareholders;
3) based on the rights provided with the shares to vote on the general meetings of shareholders;
4) according with Part 1 of Article 18 of the Law on the Joint Stock Companies to obtain information on the company's operations;
5) to address the court requesting to bring an action of damages against the company if the damage was caused by noncompliance or inadequate compliance with duties of the company manager and board of directors as stated by the Law on Joint Stock Companies of the Republic of Lithuania or other laws, as well as the Articles of Association and or in any other cases as stated by the Lithuanian Laws;
6) other non-economic rights established by the Lithuanian Laws.

Shareholders have the following property rights:

1) to receive a certain portion of the Company's profit (dividend);
2) to receive a certain portion of the company's funds when its authorized capital is decreased in order to pay out the fund to shareholders;
3) to receive shares without payment if the authorised capital is increased from the funds of the Company;
4) to have priority in acquiring the newly issued shares or convertible bonds of the Company unless the General Meeting of the Shareholders resolves to waive such right complying with the applicable Law;
5) to lend to the Company as determined by the Laws of the Republic of Lithuania, the company however cannot mortgage its assets when borrowing from shareholders. When the company borrows from shareholders the interest cannot exceed the average interest rate of the local commercial banks on the day of contracting. In this case the company and shareholders must not agree regarding the higher rate of interest;
6) to receive a portion of assets of the Company in liquidation;
7) other property rights established by the Lithuanian Laws.

The rights identified by points 1, 2, 3 and 4 are provided to the persons who were the company's shareholders at the end of the tenth working day after the corresponding general meeting of shareholders.

11. Shareholders with special control rights and description of the rights.

There are no shareholders with special control rights.

12. Overall limitations of voting rights.

As at 31st December 2012, AB "Rokiškio sūris" owns 802,094 units of own shares. The shares are not assigned with the voting right. It makes 2.24% of the Authorized capital of AB "Rokiškio sūris". There are no other shares with limited voting rights.

13. Overall agreements between shareholders.

The issuer is not aware of any agreements between shareholders which would restrict transference of securities and (or) voting rights.

14. Employees

Management structure of the Group of AB "Rokiškio sūris"

AB "Rokiškio sūris" Group's (hereinafter The Group) management structure is formed in line with the key functions such as Sales, Production, Finance management, Milk procurement, Logistics, Central services, and Development. The Functional Directors condition and develop the Group's strategy, tactics and targets in accordance with the functions.

The employees of AB "Rokiškio sūris" are provided with wide opportunities to deepen their knowledge and improve their skills in various trainings. In order to obtain higher financial resources to be used for this purpose, on April 15th 2009 it was signed a trilateral agreement between the Ministry of Social Security and Labour, Support Foundation European Social Fund Agency and AB "Rokiškio sūris" for the administration and support of the human resources development project. Total size of the project is up to LTL 2 million. The main target of the project is to enable a group of employees of AB "Rokiškio sūris" and UAB "Rokiškio pienas" to improve their essential competencies, helpful in implementation of the innovative technologies as well as their application in dairy processing sector. In the beginning of 2010, the Company signed a contract with a training company "OVC mokymai". In June 2011, it was signed an agreement with UAB "Divine training" for additional training which was financed from the accumulated resources of the project. Within 2010-2011, the trainings were attended by 187 employees. As intended, the trainings were organized in two directions: development of general skills and specific trainings to improve production technology knowledge. The project ended on 14th April 2012. The budget was used by 100 per cent. Benefits are reflected by higher quality of products and operations, new knowledge and competencies.

Also, the Company arranged some targeted trainings and seminars for farmers in order to enhance their knowledge of animal health and its protection, maintenance of milking equipment as well as milk cooling and storage equipment, and to modernize their dairy farms. A modern dairy farm, raw milk quality and healthy herd ensure successful dairy business.

Learning of languages is a key issue of training program also. There are language lessons at the company as well as lessons organized by external organizations.

Both AB "Rokiskio suris" and UAB "Rokiskio pienas" are socially responsible companies ensuring good conditions for the employee work and relaxation as well as supporting lots of the country's events in the field of science, sports, and culture. In October 2012, "Bureau Veritas Lit" performed an audit of UAB "Rokiskio pienas". Consequently, the company was granted the ISO certificate confirming that the system of social responsibility currently effective in the Company was evaluated and it complies with the requirements of management system standard SA8000:2008.

Employees of both companies have their right to participate in the activities of trade unions. There is a Trade-Union Committee established in the companies which protects the economic and social rights and interests of its members in light of employment, social guarantees, training, professional improvement as well as establishment of professional ethics, and aim to increase income of the food industry employees.

The company has put in practice Labour Deals. The contract is made between the director of AB Rokiskio sûris and Trade-Union Committee of AB Rokiskio sûris. The main purpose of the contract is to harmonize performance of the collective, and to guarantee better rights and conditions of employment, remuneration, safety and health protection, social guarantees and similar, compared to the ones established by the Laws and other legal documents of the Republic of Lithuania.

Rights and responsibilities of the company employees are provided by Job descriptions. There are no special rights and responsibilities provided by job contracts.

In accordance with the corporate strategy approved by the Board of Directors the Company's key operational targets cover all functional areas such as finance, marketing, procurement, production and control of human resources and their achievements. In order to reach the set targets the company has established an internal control system as well as the Audit Committee. The main

functions include analyzing and evaluation, also providing recommendations for improvement of the Company's operational performance. The findings of Audit Committee are presented to the Company's management, and an action plan is prepared accordingly in order to eliminate identified weaknesses. The Company's accounting and financial reports are made in accordance with the International Accounting Standards applied in the European Union.

The Company's performance is managed and controlled in assistance with the informational technologies. Security of the data on the Company's information system is ensured by document copying.

As at 31st December 2012, the number of employees working for the group of AB "Rokiškio sūris" amounted to 1,688 (average number of employees).

The table shows average number of employees of Rokiškio sūris group and variation of average salaries in 2012:

Average number of employees	2011.12.31	2012.12.31
Total:	1599	1688
Incl. Managers	10	10
Specialists	315	313
Workers	1274	1365

Average monthly salary, Lt	2011.12.31	2012.12.31
Total:	2319	2437
managers	4784	5090
specialists	2093	2200
workers	2143	2440

Education of the employees working for Rokiskio suris

	2011.12.31	2012.12.31
Education
University degree	142	160
Vocational school	735	780
High school	677	716
Unfinished high school	45	32

15. Procedure for amendments of the Articles of Association

Pursuing the Articles of Association of AB "Rokiškio sūris", the Articles may be exclusively changed by the general meeting of shareholders, except the cases provided by the Law on joint stock companies of the Republic of Lithuania. To accept the decision changing the Articles of Association, it is needed 2/3 of votes of total participants in general meeting of shareholders.

16. Transactions with related parties and significant agreements

The Group is controlled by UAB "Pieno pramonės investicijų valdymas" (established in Lithuania) and Antanas Trumpa (Director of the Company) who altogether own 62.07 per cent of the Company's Authorized Capital. The Closed Joint stock Company "Pieno pramonės investicijų valdymas" is controlled by Antanas Trumpa (as a major shareholder). The rest part of 35.69 per cent of the company's shares belongs to various minor shareholders in Lithuania and foreign countries. The company has acquired 802,094 own shares (2.24 per cent). The major shareholders of AB Rokiskio suris owning more than 5 per cent of the company's authorized capital are identified at point 9 of the report.

UAB "Pieno pramonės investicijų valdymas", members of the Board of Directors, executive managers and their family members are considered to be related parties also.

Some cooperative companies directed to milk production are considered as related parties also, because the Company may have significant influence on them through close relatives of the directors and some employees.

There are no significant agreements whose one party is the issuer and which would get in power, change or terminate upon the changed issuer's control as well as there is no such influence except the cases when the disclosure of certain agreements would make significant damage on the issuer.
There are no agreements between the issuer and its members or employees providing any compensation upon their resignation or dismissal from job without reliable reason or in case of job termination due to the change issuer's control.

Transactions with related persons/ parties are disclosed in Remark 33 of Financial accounting.

17. Key characteristics of the securities launched to the public trading:

As at 31st December 2012, it was launched to the public trading 35,867,970 (thirty five million eight hundred sixty seven thousand nine hundred seventy) ordinary registered shares. Nominal value equals to LTL 1 (one litas) per share, total nominal value of shares is LTL 35,867,970 (thirty five million eight hundred sixty seven thousand nine hundred seventy litas).

18. Securities listed on the official trading list

The 35,867,970 ordinary registered shares of AB "Rokiškio sūris" are listed on the Official List of NASDAQ OMX Vilnius Stock Exchange. (VVPB symbol RSU1L). Nominal value per share 1 (one) litas.

The Company has not issued any debt securities for the public stock trading.

The Company has not issued nor registered any debt securities for the non-public stock trading. There are no securities which would not participate as a part of the Authorized Capital and be regulated by the Law on Securities.

The shares were not traded by other stock exchanges or similar regulated markets. As from 22nd November 2010 the trade on stock markets is performed in euros.

Trade by shares of AB Rokiskio sûris on NASDAQ OMX Vilnius Stock Exchange Vilnius Stock Exchange:

Trade on central market:

	Reported period			Price (Eur)			Turnover (Eur)
from	to	max	min	aver.	Last session	Date of last trading session	max	min	Last session
2010.01.01	2010.03.31	1.043	0.840	0.987	1.014	2010.03.31	135 646.90	0	14 822.98
2010.04.01	2010.06.30	1.054	0.970	1.026	0.973	2010.06.30	508 303.30	0	3 932.55
2010.07.01	2010.09.30	1.437	0.959	1.231	1.381	2010.09.30	368 253.90	0	13 667.75
2010.10.01	2010.12.31	1.830	1.410	1.735	1.792	2010.12.30	740 490.00	0	0
2011.01.01	2011.03.31	1.789	1.505	1.696	1.750	2011.03.31	92 633.76	0	0
2011.04.01	2011.06.30	1.807	1.410	1.574	1.440	2011.06.30	118 496.02	0	118 496.02
2011.07.01	2011.09.30	1.485	1.370	1.404	1.400	2011.09.30	223.147.30	0	14 035.60
2011.10.01	2011.12.30	1.478	1.205	1.256	1.298	2011.12.30	644 770.74	0	3 595.46
2012.01.01	2012.03.30	1.388	1.29	1.360	1.359	2012.03.30	118 945.00	0	0
2012.04.01	2012.06.30	1.40	1.25	1.36	1.360	2012.06.29	108 953.50	0	4 128.00
2012.07.01	2012.09.30	1.40	1.30	1.37	1.40	2012.09.28	641 665.74	0	1 158.70
2012.10.01	2012.12.31	1.47	1.33	1.37	1.40	2012.12.28	390 622.20	0	1 950.00

Trade in shares of AB "Rokiškio sūris" within January-December 2012

Price EUR

Data source – AB NASDAQ OMX Vilnius website:

http://www.nasdaqomxbaltic.com/market/?instrument=LT0000100372&list=2&date=2013-04- 02&pg=details&tab=historical&lang=en&currency=0&downloadcsv=0&start_d=1&start_m=1&start_y=2012&end_d= 31&end_m=12&end_y=2012

Reporting period		Total turnover		Date of last	Capitalization
from	to	(units)	(Eur)	trading session	(Eur)

2009.07.01	2009.09.30	1 123 671	781 760	2009.09.30	39 712 715
2009.10.01	2009.12.31	492 856	440 243	2009.12.30	33 403 233
2010.01.01	2010.03.31	988 352	975 929	2010.03.31	38 983 123
2010.04.01	2010.06.30	1 384 497	1 419 903	2010.06.30	37 406 882
2010.07.01	2010.09.30	829 929	1 022 024	2010.09.30	53 092 399
2010.10.01	2010.12.31	1 564 687	2 715 182	2010.12.30	68 893 250
2011.01.01	2011.03.31	482 039	817 582.95	2011.03.31	62 768 948
2011.04.01	2011.06.30	791 936	1 246 500.83	2011.06.30	51 649 877
2011.07.01	2011.09.30	821 016	1 152 527.70	2011.09.30	50 215 158
2011.10.01	2011.12.30	1 192 435	1 498 010.23	2011.12.30	46 556 625
2012.01.01	2012.03.31	189 564	257 712.33	2012.03.31	48 744 571
2012.04.01	2012.06.30	228 464	310 179.89	2012.06.29	48 780 439
2012.07.01	2012.09.30	835 557	1 142 089.88	2012.09.28	50 215 158
2012.10.01	2012.12.31	525 165	717 997.30	2012.12.28	50 215 158

19. Capitalization of securities.

Capitalization the company's shares in 2009-2011, Eur

Indices of the Baltic markets: (2012.01.01-2012.12.31)

Data of the diagram:

Index/Shares	01.01.2012	31.12.2012	+/-%
OMX Baltic Benchmark GI	431.94	546.98	26.63
OMX Vilnius	298.78	355.08	18.84
OMX Baltic Benchmark PI	287.07	345.21	20.25
RSU1L	1.30 EUR	1.40 EUR	7.86

Share price DIAGRAM: OMX Vilnius, AB "Rokiškio sūris" (RSU1L), AB "Pieno žvaigždės" (PZV1L), AB "Žemaitijos pienas" (ZMP1L) and AB "Vilkyškių pieninė" (VLP1L): Indices of the Baltic markets: (2012.01.01-2012.12.31)

Data of the diagram:

Indexes/Shares	01.01.2012	31.12.2012	+/-%
OMX Vilnius	298.78	355.08	18.84
RSU1L	1.30 EUR	1.40 EUR	7.86
PZV1L	1.69 EUR	1.78 EUR	5.39
ZMP1L	0.68 EUR	0.60 EUR	-11.63
VLP1L	1.20 EUR	1.23 EUR	2.50

20. The Group's consolidated and parent company's audited financial accounts for the year 2012

The Group's consolidated and parent company's audited financial accounts for the year 2012 are provided.

21. Information on purchase of issuer's own shares

During the financial year 2012, AB "Rokiškio sūris" has not bought any own shares. The currently owned treasury shares (802,094 ordinary registered shares) were bought via Stock Exchange NASDAQ OMX Vilnius, which is affecting the submarket of official tender offer. It was paid LTL 3,865,000 for the shares. The shares make 2.24 per cent of the company's authorized capital. The company does not have the right to employ property and non-property rights using the own shares as stated by the Law on Joint Stock Companies.

22. Legal grounds of the issuer's performance

The performance of AB "Rokiškio sūris" is guided by the Law on Joint Stock Companies of the Republic of Lithuania, the Law on Securities, the Company's Articles of Association and other legal documents valid in Lithuania and applied to company practice.

23. Belonging to the associated organizations

AB "Rokiškio sūris" is a member of the Lithuanian Dairymen Association "Pieno centras". Moreover, it participates in the activities of the Chamber of Commerce, Industry and Trade of Panevezys.

The activities of the Lithuanian Dairymen Association are regulated by the Law on Associations of the Republic of Lithuania and by the Confederation Regulations.

On 20th February 2010 AB "Rokiskio suris" established an association together with other processors of agricultural production. The activities of the Association are regulated by the Law on Associations of the Republic of Lithuania, articles of association and other legal acts.

24. Brief description of the issuer's history

AB "Rokiškio sūris" is one of the largest and most modern dairy production companies in Lithuania. The main activity of the company is production and sales of fermented cheese, fresh dairy products, butter, milk powders, whey and other milk products.

Specialized "Rokiškio" cheese production was planned and started to build in 1964, whereas at the beginning of 1966 the company started its work. From the very beginning of the

company's business fermented cheese became its main product. In 1980 the company started the first reconstruction phase by putting into action a new cheese production department. The second reconstruction phase was in 1988 when the construction of new milk receiving machinery and full cream milk production departments was completed. In 1991 a new Finnish cheese maturation base was put into action.

In 1992, the state-owned enterprise "Rokiškio sūrio gamykla" was privatized and reorganized into a joint stock company "Rokiškio sūris". In 1993 the remaining governmental enterprise shares were sold. Following the decisions of the Government, in 1994 the company indexed its property. During the period from 1993 to 2002 the company's share capital increased 7 times with the help of additional contributions, 2 times thanks to own means and 3 times due to reorganization. In 2000, after affiliation of AB "Utenos pienas", and in 2002, after affiliation of "Eišiškių pieninė" the authorized capital was no longer increased.

In 1997, 150 000 of nominal equity were distributed in the form of international depository notes (GDR).

To secure constant material supply and to strengthen its position in the local market, AB "Rokiškio sūris" affiliated "Zarasų pieninė" in 1995, in 1996 – "Ukmergės pieninė", in 1998 "Šalčininkų pieninė", in 2000 "Utenos pienas" and in 2002 – "Eišiškių pieninė". In all these dairies the company created its subsidiary companies.

In the months of November and December, 2000 AB "Rokiškio sūris" increased the share portfolio of AB "Švenčionių pieninė" up to 90.6%.

In December, 2000 AB "Rokiškio sūris" acquired 49.9% of AB "Eišiškių pieninė" share portfolio, whereas in March, 2002 AB "Rokiškio sūris" increased the share portfolio of AB "Eišiškių pieninė" up to 100% of authorized capital and votes.

In March, 2001 AB "Rokiškio sūris" purchased 49.9% of AB "Varėnos pieninė" share portfolio. In October, 2001 AB "Rokiškio sūris" purchased 49.9% of AB "Ignalinos pieninė" and 100% UAB "Jonavos pieninė" share portfolio. On 1st of June, 2005 AB "Rokiškio sūris" sold the share portfolio of AB "Varėnos pieninė" and AB "Ignalinos pieninė".

On 26th April, 2002 at the general shareholder meeting of AB "Rokiškio sūris" the decision to reorganize the enterprises was made. It was decided to affiliate AB "Eišiškių pieninė" and UAB "Jonavos pieninė"; that is, the enterprises stopped functioning as legal persons.

On 4th July, 2002 AB "Rokiškio sūris" Board decided to stop the activities of AB "Rokiškio sūris" subsidiary company "Šalčininkų pieninė" and to sign it out from the Enterprises' Register.

On 30th December, 2002 the subsidiary company of AB "Rokiškio sūris" "Šalčininkų pieninė" was signed out from the Enterprises' Register of the Republic of Lithuania.

On 6th September, 2002 at the general meeting of AB "Rokiškio sūris" shareholders the following decisions were made: reorganization of AB "Rokiškio sūris", AB "Eišiškių pieninė" and UAB "Jonavos pieninė" was terminated; AB "Eišiškių pieninė" and UAB "Jonavos pieninė" property, rights and responsibilities acceptance and transfer acts were confirmed. AB "Eišiškių pieninė" and UAB "Jonavos pieninė" terminated their activities as legal persons and they were signed out from the Enterprises' Register.

On 14th November, 2002 AB "Rokiškio sūris" Board decided to establish a subsidiary company "Eišiškių pieninė". On 6th December, 2002 AB "Rokiškio sūris" subsidiary company "Eišiškių pieninė" was registered into the Enterprises' Register. On 29th October, 2005 AB "Rokiškio sūris" Board decided to terminate the subsidiary company's activities. In April, 2006 the subsidiary company "Eišiškių pieninė" was signed out from the register of legal persons.

On 14th February, 2003, following the decision of AB "Rokiškio sūris" Board, the activities of AB "Rokiškio sūris" subsidiary company "Zarasų pieninė" were terminated. On 26th June, 2003 "Zarasų pieninė" was signed out from the Enterprises' Register of the Republic of Lithuania.

On 20th August, 2003 AB "Rokiškio sūris" bought 12 units of UAB "Kalora" nominal equity, which composed 100% of UAB "Kalora" authorized capital. In October, 2005 AB "Rokiškio sūris" sold these shares.

On 18th February, 2005 an insolvency case with creditors, without the court process, was raised against AB "Švenčionių pieninė". On 29th April, 2005, due to its bankruptcy, AB "Švenčionių pieninė" was signed out from the register of legal persons.

On 14th June, 2005 AB "Rokiškio sūris" sold 410,330 units of AB "Žemaitijos pieno investicija" shares, that is, 11.63% of AB "Žemaitijos pieno investicija" authorized capital.

On 3rd March 2006, in order to achieve more effective fresh dairy production results, AB "Rokiškio sūris" Board decided to separate export-oriented cheese production business from fresh dairy production business oriented to the local market. For this reason a new subsidiary company was established. On 21st April, 2006 a subsidiary company UAB "Rokiškio pienas" was registered into the register of legal persons. The subsidiary is totally owned by AB "Rokiškio sūris".

After termination of the activities of subsidiary Eišiškių pieninė on 5th April 2006 the subsidiary of AB "Rokiškio sūris" Eišiškių pieninė was registered out from Juridical Register of the Republic of Lithuania.

In the year 2007, AB "Rokiškio sūris" acquired 50 per cent of UAB "Pieno upės" shares and 100 per cent of each of the following companies: UAB "Skeberdis ir partneriai", UAB "Skirpstas", UAB "Batėnai", UAB "Pečupė" and PK "Žalmargė". The main activity of the companies is purchase of raw milk.

In 2009, UAB "Skeberdis ir partneriai" and UAB "Pečupė" were liquidated and registered out of the Registry of Legal Entities. In 2010, shares of UAB "Batėnai" were sold. In March 2011, UAB "Skirpstas" was liquidated and registered out of the Registry of Legal Entities.

In January 2008, AB "Rokiškio sūris" acquired 50.05 per cent of block of shares of Latvian company SIA Jekabpils piena kombinats. SIA Jekabpils piena kombinats specializes in production of fermented cheese and sales of raw milk. In May 2011, the Company acquired the rest part of the shares of SIA Jekabpils piena kombinats which amounted to 49.95 per cent.

AB "Rokiškio sūris" owns 100 per cent of the Latvian company SIA Jekabpils piena kombinats.

In July 2008 the company acquired UAB "Europienas" whose main business is purchase of raw milk. In 2009, UAB "Europienas" was liquidated and registered out from Registry of Legal Entities.

In May 2010, the company acquired 40 per cent of the shares of Latvian company SIA "Kaunata".

The information on the subsidiaries of AB "Rokiškio sūris" is provided at point 3 of the report.

25. Production, description of production capacities, and implementation of new products

The Group's production is developed in the towns of Rokiškis (AB "Rokiškio sūris"), Utena (UAB "Rokiškio pienas") and Ukmerge (UAB "Rokiškio pienas" subsidiary "Ukmergės pieninė").

Specialization of Rokiskis production plant – fermented cheese, lactose and whey products.
Specialization of Utena production plant – fresh dairy products for the local market, whey protein
concentrate, milk powder and butter production.
Specialization of Ukmerge production plant curd and curd cheese production.

The Companies are highly concerned about food safety and quality issues in order to satisfy customer needs and comply with the environmental requirements.

In 2001, the Company was the first in Lithuania who was certified in accordance with the Hazard Analysis and Critical Control Point systems (HACCP), and the first of dairy companies who was certified in accordance with the Quality management and Environment management systems. In 2002, the systems were implemented and certified in Utena and Ukmerge also.

Certificates granted by the international company Bureau Veritas prove that the systems fully comply with ISO 9001:2008, ISO 14001:2004, ISO 22000:2005 or requirements of Dutch Standard for Food Safety "Requirements for the system based on HACCP. CC v HACCP, 2006". There are certain rules made in accordance with standard requirements, and they guarantee production of stabile, smooth, qualitative and safe products in order to improve effectiveness of whole system of environment protection going in line with the corporate politics. The system covers all procedures from raw milk procurement to satisfaction of customer needs.

The systems are reviewed on the constant basis and improved in order to maintain high product quality, satisfy customer needs and have wide product range for the market.

AB "Rokiškio sūris"

The key activity of AB Rokiskio suris is production fermented cheese.

The cheese produced by the company comprises of fresh, semi-hard and hard cheese. The group of fresh cheese includes ,,Cagliata" (various fat content and weight), ,,Mozzarella". The group of semi-hard cheese includes the following products: "Rokiškio sūris" (various fat content and weight), Saulės sūris, Lietuviškas, ,,Gouda", Edamo sūris, Sūris "Visiems", "Žaloji karvutė" etc., whereas Kietasis suris (various fat, moisture content and weigth), "Montecampo" and "Gojus" belong to the hard cheese type.

Besides the main production of fermented cheese, AB "Rokiškio sūris" produces liquid whey protein concentrate (WPC) which is followed by the production of WPC powder, and also milk sugar (lactose), processed cheese, and smoked cheese.

The year 2012 was a good year for AB "Rokiskio surius" in terms of production. The company produced highest levels of cheese, WPC powder and lactose compared to all previous periods.

UAB "Rokiškio pienas"

The company is highly concerned to maintain excellent quality of the produce and its safety, therefore the production costs are constantly reduced in order to maintain high level of operations and reduce negative impact on the environment whilst using lower quantities of hazardous substances and generating lower amount of waste.

Specialization of Utena production plant – fresh dairy products for the local market, whey protein concentrate, milk powder and butter production.

The line of yogurt production was modernized, consequently a new yogurt packaging equipment was installed. It allows production of wide range of yogurts, and desserts, also it prolongs shelf life of the products.

In 2011, it was mounted a new automatic equipment "Elopak" for packing 2 liter packs.

In 2012, it was mounted a robot and conveyors for loading the production on pallets.

In 2012, the customers were introduced to a new yogurt brand "Rokiškio Tikras".The yogurt is enriched with dairy proteins, various additives of berries and fruits, consistence is very soft.

Production / Year	2010	2011	2012
Fresh dairy products, t	54,770	61,880	62,772
Butter and spreadable fat blends, t	3,084	2,865	4,101
Dry milk products, t	4,657	7,360	8,442
Exported cream, t	5,355	8,212	9,165

In 2012, UAB "Rokiškio pienas" implemented a new Standard of social responsibility SA8000. The Standard covers requirements for a company which employs expertise in order to demonstrate its socially responsible attitude to employment conditions.

Purpose of Standard SA8000 is to establish requirements based on international norms related with human rights and national legislation concerning employment in order to secure all employees throughout the management chain, as well as all other employees who produce goods or supply services to the company, including the employees hired directly by the company, and its suppliers and subcontractors.

Keeping in line with the standard's requirements the company will be able to:

create, maintain and implement the politics and procedures related with the issues being in its control or sphere of influence.
demonstrate to the third parties that the company's politics, procedures and practices conform to the standard requirements.

Politics of the company:

The company's business operations are based on human and employee rights recognized internationally. We endeavor honest and honorable treatment of all employees. We expect and seek our suppliers and subcontractors as well as further chain of supply to follow similar rules. We believe that the dialogue between the employer and employees is and can contribute to the sustainable success for the company and its employees.

Fundamentals of social responsibility: Accountability (for impact on the society, economics, and environment); Transparency (decisions and the operations influencing the society and environment); Ethical conduct; Honor in regards with the third parties' interests (hear and react); Honor the superiority of laws; Follow the international conduct norms; Honor human rights.

Subsidiary of UAB "Rokiškio pienas" Ukmergės pieninė

Specialization of Ukmerge production plant – curd and curd cheese production. It is one of the biggest curd production plants in Lithuania.

Modern technologies and equipment, as well as compliance with sanitary and hygiene requirements allow maintenance of all best nourishment and energetical values of curd products, and it ensures longer shelf life of the product. It is highly important to ensure stability of product quality.

The plant continuously changes the assortment as new products are created.

A new ammonium compressor room was equipped in the plant. A boiler-room was expanded with the second boiler. Implementation of these projects ensures well stabilized supply of steam, hot and icy water whilst effectively consuming power resources.

In 2012, a new cooling room for curds and curd products was equipped, and cooling equipment was

mounted. The expanded cooling area guarantees maintenance of sanitary and hygiene standards, semi manufactures are cooled until packaging/marking. A newly opened storage room of ready production is equipped with cooling system and automatic gates with loading ramp. It allows loading two trucks whilst the product flow is not interrupted.

Curds packaging line was moved to a new room. A new line of curds packaging of 500gr and 200gr was bought and installed.

Every year the company creates new products, the assortment is renewed, and packaging designs are improved. The plant started packaging of products with fixed weight: fresh cheese BRAZILIŠKAI with spices, 45% fat in DM, 250 gr each; semi-fat curds TIKRAS, 9% fat, 300gr each.

Production, t/ year	2009	2010	2011	2012
Curds	2943	2789	3389	3765
Curd cheese	592	546	760	586
Chocolate coated curd bars	1060	724	647	460
Melted products	334	332	298	296
Fermented cheese	-	99	113	121
(unmatured)

Production quantities.

In 2010, the pant Ukmergės pieninė submitted an application to the Ministry of Agriculture of the Republic of Lithuania regarding registration of the name of Lithuanian Curd Cheese as geographically protected in accordance with the EC Register No. 510/2006 regarding protection of geographical an original places of agricultural and food products. The company expects to receive the confirmation in the nearest future.

The plant is proud of the achievements which were reached in the production of 9% curds "NAMINĖ", which is packed in exclusive brand packaging in 500gr and 200gr:

In 2012, in an exhibition in Moscow the curds NAMINĖ was granted Gold medal for innovative packaging comfortable for customers.

Following an order of UAB "Naisių vasara" to support development of Lithuanian cinematography it was started production of the following products:

curd cheese, 22% fat, NAISIŲ VASARA, in vacuum packaging, with and without cumin;
curd, 9% and 0.5%, NAISIŲ VASARA,180gr;
Chocolate coated curd bars, NAISIŲ VASARA, 23%, 40gr, 4 flavours apple and cinnamon, vanilla, strawberries, and chocolate.

The plant aims to produce safe and qualitative products in order to protect customers from negative impact on human health.

26. Sales and marketing

The biggest part of production is exported. As before, the main direction of export is European Union (mainly Italy, Germany) and Russian markets.

The biggest part of exported production is fermented cheese. In the EU region the main part of sales make unmatured cheese, in the Russian market – semi hard cheese and hard cheese which becomes more and more popular.

The Group's export sales of traditional products such as butter, cream, milk powder and byproducts (Whey protein concentrate and lactose) are increasing.

Rokiškis group is one of the dairy leaders on the local market with market share of 23 per cent. The company produces around 250 products of high quality and reasonably price for the final customer. In Lithuania Rokiškis is famous for its cheese and also other fresh dairy products such as kefir, fluid milk, sour cream, butter, curd products, yogurts, chocolate coated curd bars.

In accordance with the Lithuanian trade association the most popular goods in 2012 it was Rokiškio butter 200g 82% fat, Rokiškio sūris 240g 45% dm.

The company owns a range of strong brands targeted to various customer groups, the brands are perceived as high quality production. The product assortment produced by the group's companies is added with new qualitative value added products and packaging every year. In 2012, the product family TIKRAS was expanded, new flavours of yogurts and curd bars were introduced to the market.

In spite of rather weak market situation, the sales of Rokiškio group in Lithuania in 2012 reached LTL 241 million and were by 7 per cent higher compared to 2011.

The Group aims to further increase reliability of its produce, encourage healthy life style, and to increase consumption of dairy products per person.

Brands as follows:

A key factor is stability of the produce quality which is essential for implementation of marketing strategy.

Names of	Sold
countries	Jan-Dec 2011			Jan-Dec 2012
	kLTL	%	kLTL	%
Lithuania	225 725	32.81	241 387	30.31
European countries	341 615	49.65	400 368	50.27
Other countries	120 685	17.54	154 652	19.42
Total	688 025	100	796 407	100

Sales markets in Jan-Dec 2011 and 2012

In 2012, the consolidated non-audited sales of AB "Rokiškio sūris" group made LTL 796.407 million, i.e. 15.75 per cent more than during the same period last year. In 2011, the consolidated audited sales made LTL 688.025 million.

The better results were caused by higher quantities of production sold for export.

27. Purchase of raw milk

In 2012 in Lithuania, it was purchased 1360 thousand tons of natural milk, i.e. 3.1 per cent more than in 2011 (1317 thousand tons). The national raw milk quota of ten months of 2012-2013 was used by 68.78 per cent. Last year this number was equal to 68.19 per cent.

The most significant change in raw milk sector was decrease of raw milk prices and increase of the purchased amount.

Raw milk price paid in January 2013 to farmers delivering over 40 tons/month of milk increased by 1 per cent compared to December 2012 (from LTL 1,179/t to LTL 1,191/t), and compared to January 2012 – by 0.9 per cent (from LTL 1,181/t to LTL 1,191/t).

The table below shows prices of raw milk paid by the Group to large farmers with the farms

of European size delivering over 40 tons raw milk per month during the 2011 - 2012.

Month	Raw milk purchase price
	2011 (Lt/t)	2012 (Lt/t)
January	1,142	1,173
February	1,197	1,204
March	1,201	1,155
April	1,230	1,130
May	1,212	1,012
June	1,087	948
July	1,052	931
August	1,057	936
September	1,137	982
October	1,171	1,125
November	1,204	1,139
December	1,182	1,164
Average price per 12 months	1,153	1,072

Due to the increased amount of purchased raw milk within 2012, the production of fermented cheese as well as by products (WPC, lactose, cream etc.) increased also. Consequently, the production costs rose as well. In addition, the increase of key costs was caused by higher prices of power resources, mostly steam and gas. The increase of costs of transportation of raw milk and finished products was caused by higher petrol prices.

28. Risk factors related with the issuer's performance.

Economic factors:

Unfavourable influences related with raw milk production and sales of finished products:

a) decrease in number of cows in Lithuania;
b) lowering purchasing power of Lithuanian residents;
c) cheaper Polish products on Lithuanian market;
d) high competition;
e) substitution of dry milk products with cheaper ingredients for further production;
f) uncontrollable increase of prices for fuel/power;
g) abolishment of EU export subsidies to third countries;
h) bureaucratic restrains;
i) volatility in export prices;
j) inadequate attention of the government in regards with business;
k) volatility in the Russia market;
l) inflexible politics in regards with VAT and excise taxes;
m) volatile competition due to instable currency ration between euro and Russian ruble;
n) weakened currencies in non-EU markets;
o) oncoming crisis in the EU.

Lithuania is dominated by small milk farms. Such a high number of raw milk suppliers causes increase of costs for raw milk quality testing, and raw milk collection and accounting costs. Inadequate government support for dairy farms compared to Latvia and Estonia.

In addition, small farms cannot ensure sufficient and consistent raw milk quality, and impede investment into milk farms. Average dairy farm in Lithuania is the least in EU, moreover it is

smaller thirteen times as much compared to the average figure in EU. Raw milk production in Lithuania is heavily influenced by seasonality: collection of raw milk in summer period is almost twice as much compared to winter period. It has a negative impact on the effectiveness of milk processing, utilization of equipment capacities and cut of work places during the low session period.

Low productivity of milking cows:

of consumption and lower satisfaction of customer needs.

Low productivity of cows is caused by insufficient genetic potential of herd and poor feedstuffs. Diminishing small farms. Decrease of population in rural areas.

Unsteady dairy industry regulatory measures implemented by the State. Development of family based dairy farms was and still is too slow. Absence of consequent State politics to develop this sector, frequent changes of subsidy requirements and its amounts, concentration into milk prices rather than into investment support have had negative influence on the development of milk farms and improvement of veterinary-sanitary conditions.

Social factors:

During the past few years, emigration of residents of Lithuania increased. Now it is experienced lack of qualified work power. Decrease in reimbursement system. Low birthrate.

People lose their trust in the government, and there is no certainty in the future. Passive residents. Farming is dominated by older farmers. Community of villages is getting older also. High unemployment rate. Bankruptcy of companies. Consumption decrease due to higher taxes applied to residents. Uncontrolled rise in the prices for fuel and power resources strongly influences decrease Inefficiency of the government to create new labour places, high level of unemployment, politics of allowances, which do not encourage the will to work, lost of trust in the government politics, and the government's inefficiency.

Risk factors related to food safety issues:

Food safety risk factors of AB "Rokiškio sūris" are determined by HACCP program.

The main parts of HACCP program are Prerequisites and HACCP plans. They identify hazard points in every production step, as well as their critical control limits, their analysis, verification and correction actions.

The company has the following Pre-requisites:

1. Raw milk quality;
1. Maintenance of buildings and premises;
1. Sanitary;
1. Training of personnel;
1. Supply of water, steam and electricity. Water control;
1. Supply of water, steam and electricity. Water control;
1. Purchase and storage of additional materials;
1. Maintenance of equipment. Calibration of measurement devices;
1. Maintenance of equipment. Calibration of measurement devices;
1. Product traceability and recall;
1. Monitoring of logistics;
1. Pest control.

To monitor every production process there are prepared procedures, technological instructions, and their control procedures (both microbiological and chemical), provided records. Final products are handled according the company's standards which concerns their specifications, chemical content, nourishment, energetic value, packaging, terms of storage, shelf life etc.

Ecological:

Based on Regulation of European Parliament and Community 2008/1/EB "Regarding integrated prevention and control of pollution" (TIPK), AB Rokiskio suris is attributed to the equipment of Annex 1 which obliges to obtain the TIPK permission. The first TIPK permission was obtained on 30-12-2005, it was issued by the Department of environment protection of Panevezys region. Following the submitted application to regional Panevezys department of environment protection, on 28th December 2009 the License for integrated prevention and control of pollution (TIPK) was renewed, later on it was corrected on 01-07-2011. The company introduced most effective production forms (GPGB), and the consumption of resources and emission of pollution complies with the EU regulations.

In 2001, the company implemented environment protection system ISO 14001. The certification and auditing is made by an international company Bureau Veritas Lietuva. In 2010, the environmental protection system was successfully recertified.

The environment protection politics of AB "Rokiškio sūris" covers continuous decrease of negative impact on environment, ensuring minimal consumption of resources, and strengthening waste treatment in order to minimize negative impact on air, water and earth. In 2012, during the external and internal audit it was identified 3 remarks and no non-compliancy. The targets are set for every year in order to improve the system and reduce ecological risks. The 2012 Environmental

Protection Program was implemented. The evaluation and analysis of performance is made periodically.

The following five programs are implemented in the company in order to evaluate and analyze the impact on environment: 1) Monitoring program for field fertilization by waste from AB "Rokiškio sūris", 2) Monitoring program for treated waste from AB "Rokiškio sūris" to Ruopiškis (Alseta) lake in Rokiškis district, 3) Monitoring program for underground water of AB "Rokiškio sūris", 4) Monitoring program for underground water in petrol stations of AB "Rokiškio sūris" in Rokiškis and Obeliai. The monitoring is made by a research company UAB Geoaplinka, 5) The monitoring testing of pollution sources is made by the following certified laboratories: UAB Ekometrija, UAB Rokvesta. Certificates are submitted to Panevėžys RAAD. There is no objectionable influence identified.

In 2012, the stationary air pollution resources discharged 2.66 t of pollutants. The transport department consisted of 284 vehicles: 199 trailers, 80 automobiles, 5 other vehicles. 52 per cent of the vehicles comply with the requirements of EURO 1-5.

The company has constructed its own waste water treatment plant in order to target loads for pollutants as required by the EU standards. In 2012, it was treated 1,099 thousand m³ of waste, 8.8 per cent of waste was directed to the outside waste treatment plant UAB "Rokiskio vandenys". 5236 t of sludge was used for field fertilizing. The effectiveness of waste treatment is equal to 96-99%. In 2012, due to economic reasons it was ceased processing of dairy waste into bio-gas and electricity. Consequently, the compound by-products were sold to other companies as raw material.

AB "Rokiskio suris" uses modern technologies to separate water from whey and to purify it, up to 28 per cent of this water is used for the equipment cleaning, and it helps to save underground water.

The former dairy waste accumulation site of AB "Rokiškio sūris" in Celkiai, Rokiškis district, was inspected and the Ministry of Environment issued a positive evaluation, therefore, the site is going to be taken out of the register of dangerous objects.

The company has undergone through risk analysis, consequently a plan of preventive actions and accident liquidation was prepared. The most dangerous company's sites: ammonium compressor room, storage of chemical materials of waste water treatment plant, warehouse of chemical materials, petrol station. The company's buildings were evaluated and marked as required by the fire protection regulations. Fire alarms were equipped were necessary in order to improve fireprotection and minimize potential risk.

	2011	2012	GPGB – ES*
Quantity of issued waste per ton of raw material	0.002	0.0	-
Fee for pollution per ton of raw material	0.07	0.06	-
Quantity of waste pollutants according to BDS7 in kg per ton of raw material	0.26	0.37	-
Quantity of waste per ton of raw material, m³	1.31	1.22	0.7-6
Consumption of chemical materials in kg per ton of raw material	1.9	1.86	1.1-10.7
Power consumption in kWh per ton of raw material	39.6	35.4	60-208
Thermo-power consumption in kWh per ton of raw material	66.2	62.8	60-820

Key environmental indices:

*- GPGB- "Integrated Pollution Prevention and Control, Reference Document on Best Available Techniques in the Food, Drink and Milk Industries " August 2006

	2010	2011	2012
Taxes for environment pollution	0.101	0.108	0.210
Income from the environmental operations	0.277	0.628	1.334
Investment into environment protection	0.830	0.526	0.699
Expenditure for environment	3.487	3.300	3.414

Environmental activities, LTL million

29. Key aspects of formation of consolidated financial accounting related with the systems of internal control and risk management

These consolidated financial statements have been prepared according to International Financial Reporting Standards (IFRS) as adopted by the European Union.

The preparation of consolidated and parent company's financial statements in conformity with IFRS requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The estimates are based on the knowledge obtained by the management as well as current situation and actions.

The financial accounts include consolidated financial accounting of the Group and individual financial accounting of the Company.

Subsidiaries are all entities (including special purpose entities) over which the group has the power to govern the financial and operating policies generally accompanying a shareholding of more than one half of the voting rights. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the group controls another entity. Subsidiaries are fully consolidated from the date on which control is transferred to the group. They are deconsolidated from the date that control ceases.

The group uses the acquisition method of accounting to account for business combinations. The consideration transferred for the acquisition of a subsidiary is the fair values of the assets transferred, the liabilities incurred and the equity interests issued by the group. The consideration transferred includes the fair value of any asset or liability resulting from a contingent consideration arrangement. Acquisition-related costs are expensed as incurred. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. On an acquisition-by-acquisition basis, the group recognizes any non-controlling interest in the acquirer either at fair value or at the non-controlling interest's proportionate share of the acquirer's net assets.

The excess of the consideration transferred, the amount of any non-controlling interest in the acquirer and the acquisition-date fair value of any previous equity interest in the acquire over the fair value of the group's share of the identifiable net assets acquired is recorded as goodwill. If this is less than the fair value of the net assets of the subsidiary acquired in the case of a bargain purchase, the difference is recognized directly in the statement of comprehensive income.

Inter-company transactions, balances and unrealized gains on transactions between group companies are eliminated. Unrealized losses are also eliminated. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the group.

The group treats transactions with non-controlling interests as transactions with equity owners of the group. For purchases from non-controlling interests, the difference between any consideration paid and the relevant share acquired of the carrying value of net assets of the subsidiary is recorded in equity. Gains or losses on disposals to non-controlling interests are also recorded in equity.

When the group ceases to have control or significant influence, any retained interest in the entity is re-measured to its fair value, with the change in carrying amount recognized in profit or loss. The fair value is the initial carrying amount for the purposes of subsequently accounting for the retained interest as an associate, joint venture or financial asset. In addition, any amounts previously recognized in other comprehensive income in respect of that entity are accounted for as if the group had directly disposed of the related assets or liabilities. This may mean that amounts previously recognized in other comprehensive income are reclassified to profit or loss.

The group's interests in jointly controlled entities are accounted for by proportionate consolidation. The group combines its share of the joint ventures' individual income and expenses assets and liabilities and cash flows on a line-by-line basis with similar items in the group's financial statements. The group recognizes the portion of gains or losses on the sale of assets by the group to the joint venture that is attributable to the other ventures. The group does not recognise its share of profits or losses from the joint venture that result from the group's purchase of assets from the joint venture until it resells the assets to an independent party. However a loss on the transaction is recognised immediately if the loss provides evidence of a reduction in the net realizable value of current assets or an impairment loss.

30. Financial risk monitoring

In its operations the Company and the Group faces various financial risks. Overall risk monitoring program of the Group focuses on uncertainties of the financial markets and it aims to diminish any expected impact onto the financial results of the Group's operations.

The risk factors faced by the Company and the Group are described upon Remark 3 (page 22) of the 31st December 2012 financial report of consolidated and parent company AB "Rokiškio sūris".

31. Information about the authorization given by the Board members

Members of the Board of Directors have not authorized any other third parties to perform the functions attributable to the Board of Directors.

32. Key ratios of the company performance, their dynamics

No.	Ratios		2008	2009	2010	2011	2012
1.	Net profit %	Net profit	(3)	3	4	4	4
		Sales and services
2.	Average return	Net profit	(0.05)	0.04	0.07	0.07	0.06
	on assets	Average assets
3.	Debt ratio	Liabilities	0.52	0.47	0.40	0.35	0.31
		Assets
4.	Debt-to-equity	Liabilities	1.08	0.88	0.66	0.55	0.44
	ratio	Equity
5.	General	Current assets	0.94	1.42	1.63	1.85	2.16
	liquidity ratio	Current liabilities
6.	Assets turnover	Revenues	1.89	1.61	1.72	1.54	1.75
	ratio	Assets
7.	Book value per	Equity	4.07	4.82	5.06	8.07	8.79
	share, Lt	Number of ordinary shares
8.	Net earnings per	Net profit	(0.45)	0.38	0.65	0.79	0.84
	share, Lt	Number of ordinary shares
9.	Price to profit	Market share price	(3.84)	7.90	9.52	5.75	5.75
	per share ratio,	Profit per share
	Lt

The table below shows consolidated figures describing the Group's operations.

No	Ratios	2008	2009	2010	2011	2012

1.	Income (thousand litas)	681 821	560 395	553 760	688 025	796 407
2.	EBITDA (thousand litas)	12 785	52 272	55 413	58 821	70 886
3.	EBITDA margin (%)	1.88	9.33	10.01	8.55	8.90
4.	Operational profit (thousand litas)	(14 995)	22 358	29 663	35 141	35 971
5.	Operational profit margin (%)	(2.20)	3.99	5.36	5.11	4.52
6.	Return on equity ROE (%)	(10.55)	8.08	12.65	9.56	9.35
7.	Profitability margin (EBT margin) (%)	(3.08)	3.59	5.18	4.83	4.32

33. Investment projects implemented during the last 3 fiscal years:

Every year AB "Rokiškio sūris" give great attention to new investment into the production procedures, modernization of existing production facilities and their maintenance, procurement of raw material, continuation of environmental protection, and transport.

When Lithuania became a member of European Union, the company employed some EU support to increase investment facilities. Therefore, it was successfully used the EU financing in accordance with SAPARD and BPD 2004-2006 programs.

During 2003-2005, following the first priority sector 'Milk and Dairy Products' of the SAPARD rural development programme 'Development of Agricultural and Fishery Product Processing and Marketing', AB "Rokiškio sūris" received financial support, equal to 12.5 million litas, for production modernization. The BPD program was used for improvement of whey collection and treatment. The financial support reached LTL 3.45 million.

Upon implementation of those modern technologies, there are no product leftover for discharge into waste treatment plant. Also, during the high production season (summer) when the capacities are used at maximal levels, all whey will be collected and processed.

The investment according to the above programs was implemented successfully, the equipment is used in full capacities and the company continues to implement new investments and modernization of procedures.

The top management team of AB Rokiskio suris is very much concerned to have most modern production facilities, and to process the raw milk which would be delivered by modern vehicles with sufficient isolation and accounting systems. It is aimed to maintain high quality of purchased raw milk which fully complies with the requirements for food safety and veterinary. Also, the products should be produced with the most modern equipment.

During the last 3 fiscal years the main investments were directed to reconstruction and modernization of cheese production.

In general, AB Rokiskio suris investments are organized in the way to ensure food safety requirements within the production procedures and external surrounding including raw milk processing, production, slicing, packaging, loading and delivery of produce to the customer.

In 2007-2010, AB "Rokiškio sūris" continued the investment program, consequently some new equipment and milk trucks were bought, and the production equipment was modernized which also resulted into the better work conditions for employees, lowered power consumption, and supported environment protection program.

A part of investment was directed into improvement of raw milk quality. In 2007-1010, the main investments were made in accordance with KPP program for the period of 2007-2013. The investments were used not only for the parent company AB Rokiskio suris but for the subsidiary UAB Rokiskio pienas also. The subsidiary prepared four business plans to employ the support. Total sum of the investment plans amounts to LTL 13.81 million.

In 2007, AB "Rokiškio sūris" and its subsidiary UAB Rokiskio pienas prepared business plans according to 2007-2013 KPP measure "Processing of agricultural products and increase of added value" first section "Marketing of agricultural products". In 2008, a part of the investment was made from the fund and the other part from own resources. In 2007, the Group invested LTL 19.6 million.

In 2008, the group's allocation to investment amounted up to 34.7 million litas, in 2009 it was 8.5 million litas.

Also, it was purchased some new vehicles for raw milk collection and transportation, and also the trucks with refrigeration system for transportation of finished products.

In 2010, AB Rokiskio suris prepared two business plans in accordance with 2007-2013 program. They are "Modernization, of raw milk processing by AB Rokiskio suris in order to increase competitive ability of the company" and "Modernization, of raw milk processing by AB Rokiskio pienas in order to increase competitive ability of the company".

Total sum of investment in 2010 amounted to LTL 6.5 million.

Total sum of investment in 2011 amounted to LTL 16.4 million.

Total sum of investment in 2012 amounted to LTL 11.4 million.

The main directions of the investment in 2012:

Production of high value added products (long maturing various packaging and shapes fermented and processed-smoked cheese);
Cheese loading into boxes and on pallets using a robot;
Production of big wheels of had grated cheese, 35 kilos each;
Modernization of technological process of whey products;
Acquire sets of various shapes of cheese moulds;
Modernization of the departments servicing production facilities (thermo and energy supply departments, compressor room, water supply department, laboratory);
Renewal of assortment and packaging of fresh dairy products;
Maintenance of competitive ability level in the market;
Improvement of sanitary and hygiene level in the production facilities (in the way of equipment of ventilation systems, humidity collectors, and CIP sites);
Improvement of quality, control and monitoring;
Software engagement into the equipment of cheese packaging and scaling;
Implementation of new technologies;
Saving power resources complying with EU requirements;
Continuation of environment protection politics;
Increase of competitive ability by high added value products;
Increase of level of competitiveness introducing added value products to the market;
Modernization of warehouses of finished products (reconstruction of premises and equipment);
Modernization of internal transport;
Automatization of cheese loading/unloading from containers;
Improvement of work conditions of employees;
Modernization of cheese packaging complying with customer needs;
Implementation of new technologies;
Modernization of heating system and compressor room, implementation of accounting system;

All investments were made in Lithuania: Rokiskis and the related sites in Utena and Ukmerge.

34. Future plans, forecasts and investments envisaged in 2013

In 2013, the group of AB "Rokiškio sūris" is going to make investments amounting to LTL 25.3 million.

Mainly the investments in 2013 will be directed into further processing of whey. The expected investment will be used for development of AB " Rokiškio sūris" and UAB "Rokiškio pienas". Therefore, the whey processing equipment will be reconstructed and a new processing line will be acquired for the production of this product.

The greatest part of the investment 2013 will be allocated for this project.

Fluid whey concentrate will be made in AB "Rokiškio sūris", and the drying part will be completed in a subsidiary UAB "Rokiškio pienas".

In addition, a part of investment is directed to the KPP 2007-2013 programme, as well as completion of the projects in progress in order to ensure smooth and stabile operations of the equipment and creation of new products. A part of investments will be directed to creation of new product packaging designs and production of new fresh dairy products.

In 2013, all the investments provided by the KPP 2007-2013. Program will be completed.

The main target of the investments is to continue effective usage of current equipment by modernization and improvement of technological procedures.

It is provided that acquisition of equipment should first satisfy customer needs in terms of finished production. It is aimed the equipment would ensure safety and quality of the product as well as variability of packaging responding to growing market demand.

Great attention is paid to the departments providing services to the production plants and modernization of their equipment: cooling systems, power supply, waste utilization, ventilation systems.

Also, to the storage and delivery of ready-to-cook products and finished products within the company's departments. Therefore, some more fork-lifts will be bought.

The 2013 investments are targeted to enhance the company's competitiveness, as well as improved employment of production facilities by implementing additional equipment and considering environment protection.

35. Dividends paid

Dividends paid according share types and class during the last 6 years:

	2006		2007
Type of shares	Amount of dividends, Lt	Per share	Dividend/ Net profit	Amount of dividends, Lt	Per share	Dividend/ Net profit
Ordinary registered share	10,081,101.08	2.36 Lt (23.60%)	0.77 Lt	9,902,131.20	0.24 Lt (24.00%)	0.29 Lt

Table continued

	2008		2009
Type of	Amount of	Per	Dividend/	Amount of	Per share	Dividend/
shares	dividends, Lt	share	Net profit	dividends, Lt		Net profit
Ordinary		Dividends were not paid		3,844,483.40	0.10 Lt	0.26 Lt
registered				(10.00%)
share

Table continued

	2010		2011
Type of	Amount of	Per	Dividend/	Amount of	Per share	Dividend/
shares	dividends, Lt	share	Net profit	dividends, Lt		Net profit
Ordinary	3,586,797,00	0.10 Lt	0.15 Lt	3,506,588.00	0.10 Lt	0.13 Lt
registered		(10.00%)			(10.00%)
share

36. Management bodies of the issuer

In accordance with the Articles of Association of AB "Rokiškio sūris", the managing bodies of the company are as follows: General shareholders' meeting, the Board of Directors and the Chief Executive Officer.

General meeting of shareholders:

The competence and procedure of announcement applied to the general shareholders' meeting complies with the competence and procedure of announcement applied to the general shareholders' meeting established by the Law on Joint Stock Companies.

General meeting of shareholders have the following exclusivity rights:

1. to amend the articles of association;
1. to change the company's legal address;
1. to elect a supervisory body, yet if this is not formed then to elect the management board members. In case both bodies are not formed, then to elect the company's executive manager;
1. to recall the supervisory body or its members, as well as the elected board of directors and the company's executive manager;
1. to elect and recall the company's auditor executing annual financial reports, determine its payment module;
1. to establish the class, number, nominal value and minimal price of share emission;
1. to convert of one type of shares into the shares of another type, approval of exchange procedure of the Company's shares;
1. to approve annual financial reports;
1. to adopt resolution regarding distribution of profit (loss);
1. to form, use, decrease or cancel reserves;
1. to approve interim financial accounting prepared on purpose to accept resolution regarding dividends payout for the period shorter than a financial year;
1. to accept resolution regarding dividends payout for the period shorter than a financial year;
1. to resolve regarding emission of convertible bonds;
1. to resolve regarding cancellation of prerogative right to all shareholders to acquire the Company's shares of a certain emission;
1. to resolve regarding increase of the authorized capital;
1. to resolve regarding decrease of the authorized capital;
1. to resolve regarding purchase of the company's shares;
1. to resolve regarding reorganization or segregation of the Company and approval of terms for reorganization or segregation;
1. to resolve regarding reformation of the Company;
1. to resolve regarding restructuration of the Company;
1. to resolve regarding liquidation of the Company or cease of liquidation unless the Law on Joint Stock Companies provides differently;
1. to elect and recall the company's liquidator unless the Law on Joint Stock Companies provides differently;

General meeting of shareholders may discuss other issues assigned by the articles of association of the company if the Law on Joint Stock Companies does not assign those functions to other management bodies and in general they are not the functions of management body.

A resolution of general meeting of shareholders is considered to be accepted when a simple majority votes for the resolution rather than against, except in case of points 1, 6, 7, 9, 10, 12, 13, 15, 16, 18, 19, 20, 21 which requires the participated majority of 2/3 of shares with the voting right. Resolution for an item of point 14 may be adopted with the participated majority of 3/4 of shares with the voting right.

37. Committees formed in the Company

Audit Committee of AB Rokiskio suris:

The company's Audit Committee is made of 3 members one of which is independent. The cadency of the Audit Committee is four years. Upon recommendation of the company's Board of Directors the members of Audit Committee are elected by the general meeting of shareholders. The members of Audit Committee were elected by the 24th April 2009 general meeting of shareholders.

Members of Audit Committee:

Kęstutis Kirejevas – independent member, director of UAB "EuropaPrint", has no shares of AB "Rokiškio sūris";

Rasa Žukauskaitė – works for AB "Rokiskio suris", in the financial department, has 2 shares of AB "Rokiškio sūris";

Asta Keliuotytė - works for AB "Rokiskio suris", in the financial department, has no shares of AB "Rokiškio sūris".

Key functions of Audit Committee include the following:

1) supervision of preparation of financial accounts;

2) supervision of functional internal control of the company, risk management and internal audit system,
3) supervision of the Company's auditing procedure;
4) supervision how an auditor pursues the principles of independency and impartiality;
5) honest and responsible operation in favour of the Company and its shareholders.

The Audit Committee is a collegial body accepting its decisions at the meetings. The Audit Committee may adopt resolutions and its meeting is considered to be valid when it is attended by at least 2 (two) members of the committee. A resolution is adopted when it is voted for by at least two members of the Audit Committee.

Members of the Audit Committee are elected and recalled by the company's general shareholders' meeting following recommendations of the Board of Directors.

Cadency period of the Audit Committee ends in April 2013.

There are no other committees formed in the company.

38. Management bodies

Management of the company:

Chief Executive Officer - Antanas Trumpa Deputy CEO - Dalius Trumpa Chief Financial Officer - Antanas Kavaliauskas Development Director – Ramūnas Vanagas Central Services Director – Jonas Kvedaravičius Logistics Director – Jonas Kubilius Procurement Director – Evaldas Dikmonas Sales and Marketing Director – Darius Norkus

System of bonuses for the management:

As the management of the company consists of the same members as the Board of Directors, they receive tantiemes in accordance with the company's performance results, also all members of the management receive wages and variable payouts which depend on the company's performance results, market situation and other factors.

39. Members of collegial bodies

The Board of Directors of AB "Rokiskio suris"

The Board of Directors is a collegial management body comprised of 4 (four) members. The Board members are elected and recalled by the general shareholders' meeting pursuing the procedure set by the Law on Joint Stock Companies.

Members of managing bodies:

Dalius Trumpa (Chairman), Antanas Kavaliauskas (Deputy Chairman), Ramūnas Vanagas, and Darius Norkus.

The members were elected by the 17th July 2012 general meeting of shareholders of AB "Rokiškio sūris". Term of service of the Board of Directors is 4 years.

Board of Directors:

(as at 31-12-2012)

Dalius Trumpa – Board Chairman (elected on 17th July 2012). Owns 1,002,697 ordinary registered shares. i.e. 2.80% of the Authorized capital and 2.86% of votes of AB "Rokiškio sūris".

Education – university degree. Works for the company since 1991. As from 2002 in the capacity of production director. As from 2007 appointed a deputy director. Also the director of UAB Rokiskio pienas from 2007. Participation in the activities of other companies:

Shareholder of UAB" Pieno pramonės investicijų valdymas", having 3.91% of the company's shares and votes;

Chief executive officer of UAB "Rokiškio pienas", having no shares; Director of UAB "Rokvalda", having 100% of shares and votes.

Antanas Kavaliauskas Deputy Chairman (elected on 17th July 2012), the Chief Financial Officer of AB "Rokiškio sūris", having no ownership of AB "Rokiškio sūris".

Works for the company since 2002 in the capacity of finance director. Education – university degree. In 1997, obtained a master degree of finance management in Kaunas technology university.

Participation in the activities of other companies:

Shareholder of UAB "Pieno pramonės investicijų valdymas" owning 3.91% of shares of UAB" Pieno pramonės investicijų valdymas".

Board Chairman of Latvian company SIA Jekabpils piena kombinats, having no shares;

Director of Lithuanian dairy association "Pieno centras", having no shares

Ramūnas Vanagas - Board member (elected on 17th July 2012), Development Director of AB "Rokiškio sūris", having no ownership of shares of AB "Rokiškio sūris".

Education – university degree. Works for the company since 2005 in the capacity of business development director.

Participation in the activities of other companies:

No participation in other companies' activities.

Darius Norkus – Board member, (elected on 17th July 2012), Sales and Marketing director of AB "Rokiškio sūris", having no shares of the company.

Education – university degree. Works for the company since 2001 in the capacity of the sales and marketing director.

Participation in the activities of other companies:

Shareholder of UAB "Pieno pramonės investicijų valdymas", having 3.91 % of the company's shares and votes.

Term of election of the Board of Directors is 4 years. The cadence ends on 17th July 2016.

Manager of the Company:

The Chief Executive Officer is a one-man management body who organizes everyday activities of the company. Within relationship between the company and other persons, the Chief Executive Officer acts determinatively on behalf of the company.

Information on the company's manager (director):

The CEO of the Company:

Antanas Trumpa owning 8,240,053 ordinary registered shares of AB "Rokiškio sūris", i.e. 22.97% of the authorized capital of AB "Rokiškio sūris" and 23.50% of votes.

Education – university degree. Works for the company as from 1966. In 1979, prepared a dissertation "Organizing the work of vacuum apparatus" in Kaunas Polytechnic Institute, consequently on 12th October 1994 was granted a doctor degree by Lithuanian Science Council.

Participation in the activities of other companies:

Board Chairman of UAB "Rokiškio pienas".

Shareholder of UAB "Pieno pramonės investicijų valdymas" with 6,758, i.e. 67.04% of the shares and votes of UAB" Pieno pramonės investicijų valdymas".

Information on the company's finance director:

Chief Financial Officer Antanas Kavaliauskas

For more information about the Chief Financial Officer see point 12 as per information about the management bodies.

Data on the allocated funds

In 2012, it was allocated the following sums to the members of the Board of Directors of AB "Rokiškio sūris", manager of the Company and the chief finansist, average amounts are calculated falling on one member of management bodies, as well as transferred property and guarantees:

Members of collegial bodies	Number of people	Total allocated sums (wages and tantiemes), thou Lt	Average amount per person, (wages and tantiemes), thou Lt	Transferr ed property, thou Lt	Guarante es given, thou Lt
Members of the Board of Directors	4	1 219.8	305.0	-	-
Manager of the company and chief finansist	2	153.4*	76.7*	-	-

* As they are not members of the Board of Directors, there are no tantiemes, only income in form of wages

40. Information on observance of the Company management codex.

Annex to the Consolidated annual report

Rokiskio suris AB disclosure of compliance with the Governance Code of the companies whose securities are traded on a regulated market is provided as an annex and it is a part to the consolidated annual report.

41. Information on the publicly announced data

The 27th April 2012 resolutions of the general meeting of shareholders of AB "Rokiškio sūris"
Auditor's findings regarding the set of consolidated financial reports and annual report. Resolution: To endorse the auditor's report (enclosed).
The Audit Committee report. Resolution:

To endorse the report of the Audit Committee (enclosed).

The Company's annual report for the year 2011.

Debriefed with the annual consolidated report of AB "Rokiškio sūris" 2011 evaluated by the auditors and approved by the Board of Directors (enclosed).

Approval of the company's consolidated financial accounting for the year 2011. Resolution:

To approve the set of audited consolidated financial reports for the year 2011 (enclosed).

Allocation of the Company's profit (loss) of 2011.

Resolution:

To approve allocation of the Company's profit (loss) of 2011.

	Title	kLTL	kEUR
1.	Non-distributable profit (loss) at beginning of year	89 123	25 812
2.	Approved by shareholders dividends related to the	3 688	1 068
	year 2010
3.	Transfers to reserves provided by law	-	-
4.	Profit share transferred to reserves for acquisition	20 000	5 792
	of own shares
5.	Non-distributable profit (loss) at beginning of year	65 435	18 951
	after dividend payout and transfer to reserves
6.	Net profit (loss) of fiscal year	27 569	7 985
7.	Distributable profit (loss)	93 004	26 936
8.	Profit share for mandatory reserve	-	-
9.	Profit share for other reserves	-	-
10.	Profit share for dividend payout	3 506	1 015
11.	Profit share for annual payments (tantiemes) to the	1 168	338
	Board of Directors, employee bonuses and other
12.	Non-distributable profit (loss) at end of year	88 330	25 582
	transferred to the next fiscal year

Allotted for the dividends related to 2011 – LTL 3,506,588 (EUR 1,015,578), i.e. LTL 0.10 (EUR 0.029) per ordinary share (before taxes).

The Law on Companies of the Republic of Lithuania provides that dividends shall be paid to the shareholders who at the end of the tenth business day following the Annual General Meeting that adopts a decision on dividend payment (rights accounting day) will be on the Shareholders' List of the Company, i.e. the shareholders of AB Rokiskio suris on 14 May 2012.

Following Lithuanian laws dividends paid to natural persons-residents of the Republic of Lithuania and natural persons-residents of foreign countries are subject to withholding Personal income tax of 20 per cent. Dividends paid to legal entities of the Republic of Lithuania and legal entities-residents of foreign countries are subject to withholding Corporate income tax of 15 per cent, unless otherwise provided for by the law.

Election of the Company's auditor and establishment of payment conditions.

Resolution:

To appoint UAB "PriceWaterhouseCoopers" as an Auditor of JSC Rokiskio suris. The Board of Directors shall establish a fee for the auditor's work. The Company's Chief Executive Officer shall sign a contract with the auditor.

7. Regarding purchase of own shares.

Resolution:

1). To purchase up to 10 per cent of own shares.

2). Purpose of acquisition of own shares – maintain and increase the price of the company's shares.

3). Period during which the company may purchase own shares - 18 months from the approval of resolution.

4). Maximal purchase price per share set as – EUR 3.475 (LTL 12.00) minimal purchase price per share is set equally to nominal value of share – EUR 0.290 ( LTL 1.00).

5). Minimal sales price per share of the treasury shares is equal to the price at which the shares were purchased. When selling treasury shares it should be established equal opportunities for all shareholders to acquire the company's shares. Also, it shall be provided the opportunity to annul treasury shares.

6). To authorize the Board of Directors to organize purchase and sales of the own shares, establish an order for purchase and sales of the own shares, as well as their price and number, and also complete all other related actions pursuing the resolutions and requirements of the Law on Joint Stock Companies

8. Regarding compounding the reserve to acquire own shares.

Resolution:

Reserve for acquisition of own shares accumulated amounts up to LTL 40 287 thousand (EUR 11 668 thousand).

9. Election of the Board members.

The following members of the Board of Directors were elected: Evaldas Dikmonas (Procurement Director of Rokiskio suris AB ), Antanas Kavaliauskas (Chief Financial Officer of Rokiskio suris AB), Jonas Kubilius (Logistics Director of Rokiskio suris AB), Petras Kudaras (Investment Manager of Invalda AB), Jonas Kvedaravičius (Central services Director of Rokiskio suris AB), Darius Norkus (Export sales and maturing Director of Rokiskio suris AB), Andrius Trumpa (Lecturer of Vilnius Gedimino Technikos University), Dalius Trumpa (CEO of Rokiskio pienas UAB), Ramūnas Vanagas (Business Development Director of Rokiskio suris AB).

Resolutions of AB "Rokiskio suris" for the 17th April 2012 Extraordinary General meeting of shareholders

1. Amendments of the Company's Articles of Association.

Resolution:

Amendments of the Company's Articles of Association in relation with the updated Law on Joint Stock Companies and reconstruction of management bodies. (Articles of Association attached). 2. The CEO Antanas Trumpa is authorized to sign the Company's Articles of Association and to proceed with any actions related with the amendment of the Articles of Association and its registering in the Register of Juridical Bodies.

2. Recall the Board of Directors.

Resolution: To recall all Board of Directors.

3. Election of the Board members.

The following members of the Board of Directors were elected: Antanas Kavaliauskas (Chief Financial Officer of Rokiskio suris AB), Darius Norkus (Export sales and maturing Director of Rokiskio suris AB), Dalius Trumpa (CEO of Rokiskio pienas UAB), and Ramūnas Vanagas (Business Development Director of Rokiskio suris AB).

Regarding the situation elated to AB Ūkio bankas

Rokiskio suris AB notifies that the company and its group have no deposits or securities in Ukio bankas AB, therefore the 12th February 2013 resolution made by the Bank of Lithuania to temporarily suspend the operations of Ukio bankas AB will not influence the operational results of the group of Rokiskio suris AB.

Regarding reorganization of daughter enterprise

The 28th February 2013 Board of Directors of AB Rokiskio suris resolved to reorganize the daughter company UAB Rokiskio pienas in the manner of segregation of the company's long term assets and establishing a new company which would be 100 per cent owned by AB Rokiskio suris. This kind of segregation will not have any significant influence onto the consolidated financial results of the group of AB Rokiskio suris as well as the ownership of the shareholders.

All information on the company's material events is presented following Article 28 of the Law on Securities of the Republic of Lithuania.

The company publishes its information through the base of Central Public Information, on the website of Vilnius Securities Exchange http://www.baltic.omxnordicexchange.com and the company's website www.rokiskio.com

42. Information on the publicly announced data after the end of fiscal year

Other information on the important events after the end of fiscal year is presented with the 31st December 2012 consolidated and parent company AB Rokiskio suris financial reports, under Remark 34 (page 49).

43. Information on audit

The audit of AB "Rokiškio sūris" (The Group) consolidated balance sheet and related comprehensive income statement as at 31st December 2012, as well as cash flow and changes in equity statements were prepared by UAB "PricewaterhouseCoopers".

44. Performance strategy and evaluated changes in the nearest fiscal year

Mission

AB "Rokiškio sūris" = Reliable Dairy Industry Professionals (Patikimi Pieno Pramonės Profesionalai).

Key values:

Professional approach.
Impeccable attention to the satisfaction of the needs of our clients and consumers.
Respect for and trust in employees.
Constant improvement.

Long-term Objectives

Creation of a solid and profitable EU market for AB "Rokiškio sūris" products and services
Ensuring of a stable and coordinated waste-free production programme
Maintenance of stabile relationships with raw milk suppliers.

Key values and strengths:

Harmonized team and sustainable management.
Modern technologies.
Experience.
Financial stability.
Fast and flexible decision making and reaction the external changes.
Continuous improvement.

In the Baltic region we are:

The most effective dairy producer because:
We have a reliable quality management system,
We are a reliable partner of milk producers,
We are attractive employer,
The company's brand is a guarantee of reliability and quality, well known in the Baltic region, and the Eastern and Western markets.
Leader of dairy industry in Lithuania and the Baltics in accordance with the following:
Quantity of processed milk,
Production of fermented cheese,
Turnover and profit.

SUPPLEMENT TO THE CONSOLIDATED ANNUAL REPORT 2012

Rokiskio suris AB disclosure of compliance with the Governance Code of the companies whose securities are traded on a regulated market

Rokiskio suris AB, following Article 21 paragraph 3 of the Law on Securities of the Republic of Lithuania and item 24.5 of the Listing Rules of AB NASDAQ OMX Vilnius, discloses its compliance with the Corporate Governance Code for the Companies Listed on NASDAQ OMX Vilnius, and its specific provisions.

PRINCIPLES/ RECOMMENDATIONS	YES/NO /NOT APPLIC ABLE	COMMENTARY
Principle I: Basic Provisions
The overriding objective of a company should be to operate in common interests of all the shareholders by
optimizing over time shareholder value.
1.1. A company should adopt and make public the	Yes	The Company announces its development
company's development strategy and objectives by clearly		strategy and objectives publicly in its annual
declaring how the company intends to meet the interests		reports and interim reports which are submitted
of its shareholders and optimize shareholder value.		via the central base of regulated information and
		the company's website.
1.2. All management bodies of a company should act in	Yes	The Company's managing bodies act in
furtherance of the declared strategic objectives in view of		furtherance of the strategic plan according to
the need to optimize shareholder value.		which the mission is to form a strong, financially
		sound and technically modern enterprise creating
		and constantly increasing its value for
		shareholders.

1.3. A company's supervisory and management bodies	Yes	As the Company does not have a supervisory
should act in close co-operation in order to attain		body – a Supervisory Board, the function of
maximum benefit for the company and its shareholders.		supervision is acted by the Audit Committee, as
		well as the Board of Directors and the Company's
		manager in the manner of close cooperation (the
		Company's manager, and members of the Board
		when needed, are invited to participate at the
		meetings of the Audit Committee. They submit
		reports on the company's performance,
		implementation of strategic plan and budgeting,
		provide recommendations for the financial
		reporting), which benefits to both the Company
		and shareholders.
1.4. A company's supervisory and management bodies	Yes	The Company's Board of Directors and managing
should ensure that the rights and interests of persons other		bodies ensure the rights and interests of
than the company's shareholders (e.g. employees,		shareholders, employees, raw material suppliers
creditors, suppliers, clients, local community),		are duly respected. Employees can enjoy
participating in or connected with the company's		opportunities to improve their qualification at
operation, are duly respected.		various seminars and courses in Lithuania and
		abroad, development of milk farms is supported,
		and organic farms are encouraged. The great part
		of employees and milk producers are
		shareholders of the Company.

Principle II: The corporate governance framework

The corporate governance framework should ensure the strategic guidance of the company, the effective oversight of the company's management bodies, an appropriate balance and distribution of functions between the company's bodies, protection of the shareholders' interests.

2.1. Besides obligatory bodies provided for in the Law on	No	The Company's managing bodies are a general
Companies of the Republic of Lithuania – a general		shareholders' meeting, the Board of Directors and
shareholders' meeting and the chief executive officer, it is		the Chief Executive Officer. The Company does
recommended that a company should set up both a		not have a collegial supervisory body, and its
collegial supervisory body and a collegial management		functions are overtaken by the Board of
body. The setting up of collegial bodies for supervision		Directors. The Company's CEO is accountable to
and management facilitates clear separation of		the Board of Directors.
management and supervisory functions in the company,
accountability and control on the part of the chief
executive officer, which, in its turn, facilitate a more
efficient and transparent management process.

2.2. A collegial management body is responsible for the	Yes	Functions of the collegial management body are
strategic management of the company and performs other		carried out by the Board of Directors.
key functions of corporate governance. A collegial
supervisory body is responsible for the effective
supervision of the company's management bodies.
2.3. Where a company chooses to form only one collegial	No	The Company has only one collegial management
body, it is recommended that it should be a supervisory		body and it is the Board of Directors who carries
body, i.e. the supervisory board. In such a case, the		out the functions of the supervisory board.
supervisory board is responsible for the effective
monitoring of the functions performed by the company's
chief executive officer.
2.4. The collegial supervisory body to be elected by the	Yes	The Company has a collegial management body –
general shareholders' meeting should be set up and should		the Board of Directors. Principles III and IV of
act in the manner defined in Principles III and IV. Where		the Code are applied to the Board of Directors.
a company should decide not to set up a collegial
supervisory body but rather a collegial management body,
i.e. the board, Principles III and IV should apply to the
board as long as that does not contradict the essence and
purpose of this body.
2.5. Company's management and supervisory bodies	Yes	According to the Articles of Association the
should comprise such number of board (executive		Board of Directors consists of 5 members.
directors) and supervisory (non-executive directors) board		Currently there are 4 Board members. One seat is
members that no individual or small group of individuals		vacant and it is expected for an independent
can dominate decision-making on the part of these bodies.		candidate. As soon as the company's shareholders
		find an independent Board member, he/she will
		be introduced for election. The Company believes
		that 5 members are able to ensure productive
		work of the Board of Directors enabling to adopt
		resolutions and it is assumed that an individual
		member or small group do not dominate the
		decisions of the Board of Directors. Every Board
		member has one vote.
2.6. Non-executive directors or members of the	Yes	According to the Articles of the Association the
supervisory board should be appointed for specified terms		Board of Directors is elected for the 4 year
subject to individual re-election, at maximum intervals		period. Number of cadencies is not limited. A
provided for in the Lithuanian legislation with a view to		possibility to resign or remove a member of the
ensuring necessary development of professional		Board of Directors is regulated by the Lithuanian
experience and sufficiently frequent reconfirmation of		legislation – a Board member may resign before
their status. A possibility to remove them should also be		his/her cadency is ended if the company is
stipulated however this procedure should not be easier		informed about it in written not later than 14 days

than the removal procedure for an executive director or a		in advance. A Board member may be recalled by
member of the management board.		the same institution which elected, i.e. general
		meeting of shareholders.
2.7. Chairman of the collegial body elected by the general	No	The Company's Board Chairman is not the Chief
shareholders' meeting may be a person whose current or		Executive Officer, but he is a director of daughter
past office constitutes no obstacle to conduct independent		company.
and impartial supervision. Where a company should
decide not to set up a supervisory board but rather the
board, it is recommended that the chairman of the board
and chief executive officer of the company should be a
different person. Former company's chief executive
officer should not be immediately nominated as the
chairman of the collegial body elected by the general
shareholders' meeting. When a company chooses to
departure from these recommendations, it should furnish
information on the measures it has taken to ensure
impartiality of the supervision.

Principle III: The order of the formation of a collegial body to be elected by a general shareholders' meeting

The order of the formation a collegial body to be elected by a general shareholders' meeting should ensure representation of minority shareholders, accountability of this body to the shareholders and objective monitoring of the company's operation and its management bodies.

3.1. The mechanism of the formation of a collegial body	Yes	Only 1 Member of the Board of Directors of total
to be elected by a general shareholders' meeting		4 is a shareholder of the Company. Other
(hereinafter in this Principle referred to as the 'collegial		members are not shareholders. Minor
body') should ensure objective and fair monitoring of the		shareholders are not limited in their right to
company's management bodies as well as representation		represent their interests and have their
of minority shareholders.		representative on the Board of Directors.
		Pursuing the resolution of general meeting of
		shareholders according to the Law on Joint Stock
		Companies the Board members are provided
		remuneration in the form of tantiemes
3.2. Names and surnames of the candidates to become	Yes	Information about the members of the Board of
members of a collegial body, information about their		Directors (names, education, qualifications,
education, qualification, professional background,		professional experience, participation in the
positions taken and potential conflicts of interest should		activities of other companies, other important
be disclosed early enough before the general shareholders'		professional obligations) is provided in the
meeting so that the shareholders would have sufficient		periodical reports.
time to make an informed voting decision. All factors

affecting the candidate's independence, the sample list of
which is set out in Recommendation 3.7, should be also
disclosed. The collegial body should also be informed on
any subsequent changes in the provided information. The
collegial body should, on yearly basis, collect data
provided in this item on its members and disclose this in
the company's annual report.
3.3. Should a person be nominated for members of a	Yes	A candidate to the members of the Board inform
collegial body, such nomination should be followed by the		general meeting of shareholders about his/ her
disclosure of information on candidate's particular		education, professional performance, position and
competences relevant to his/her service on the collegial		participation in the activities of other companies.
body. In order shareholders and investors are able to		Members of the Board provide information on the
ascertain whether member's competence is further		participation in qualification programs related
relevant, the collegial body should, in its annual report,		with activities on the Board.
disclose the information on its composition and particular
competences of individual members which are relevant to
their service on the collegial body.
3.4. In order to maintain a proper balance in terms of the	Yes	The members of Company's collegial body – the
current qualifications possessed by its members, the		Board of Directors – are the Company's
desired composition of the collegial body shall be		Functional Directors leading some specific areas
determined with regard to the company's structure and		of the Company's performance, they are
activities, and have this periodically evaluated. The		competent and qualified to maintain their
collegial body should ensure that it is composed of		functions.
members who, as a whole, have the required diversity of		The Audit Committee consists of 3 members, one
knowledge, judgment and experience to complete their		of which is independent and has at least 5 year
tasks properly. The members of the audit committee,		experience in accounting. Other members of the
collectively, should have a recent knowledge and relevant		Audit Committee are also qualified to maintain
experience in the fields of finance, accounting and/or		their functions. The Auditing Committee carries
audit for the stock exchange listed companies. At least		out independent and objective activities
one of the members of the remuneration committee should		analyzing, evaluating and consulting the
have knowledge of and experience in the field of		Company in order to improve the Company's
remuneration policy.		performance and increase its added value.
3.5. All new members of the collegial body should be	No	All new Board members are informed on the
offered a tailored program focused on introducing a		Company's performance, organization and
member with his/her duties, corporate organization and		changes in the meetings of the Board of
activities. The collegial body should conduct an annual		Directors.
review to identify fields where its members need to update
their skills and knowledge.
3.6. In order to ensure that all material conflicts of interest	No	Currently there are no independent members on
related with a member of the collegial body are resolved		the Board of Directors, however there is one seat

properly, the collegial body should comprise a sufficient		left for an independent member of the Board.
number of independent members.
3.7. A member of the collegial body should be considered	No	As from 1995 until 2006, the greatest part of the
to be independent only if he is free of any business, family		Board of the Company was made of independent
or other relationship with the company, its controlling		members. When the structure of shareholders
shareholder or the management of either, that creates a		changed, and the Board of Directors resigned, the
conflict of interest such as to impair his judgment. Since		new members were elected, and they do not
all cases when member of the collegial body is likely to		comply with the Code's independency criteria.
become dependent are impossible to list, moreover,
relationships and circumstances associated with the
determination of independence may vary amongst
companies and the best practices of solving this problem
are yet to evolve in the course of time, assessment of
independence of a member of the collegial body should be
based on the contents of the relationship and
circumstances rather than their form. The key criteria for
identifying whether a member of the collegial body can be
considered to be independent are the following:
1) He/she is not an executive director or member of
the board (if a collegial body elected by the
general shareholders' meeting is the supervisory
board) of the company or any associated
company and has not been such during the last
five years;
2) He/she is not an employee of the company or some
any company and has not been such during the
last three years, except for cases when a member
of the collegial body does not belong to the
senior management and was elected to the
collegial body as a representative of the
employees;
3) He/she is not receiving or has been not receiving
significant additional remuneration from the
company or associated company other than
remuneration for the office in the collegial body.
Such additional remuneration includes
participation in share options or some other
performance based pay systems; it does not
include compensation payments for the previous
office in the company (provided that such
payment is no way related with later position) as

per pension plans (inclusive of deferred
compensations);
4) He/she is not a controlling shareholder or
representative of such shareholder (control as
defined in the Council Directive 83/349/EEC
Article 1 Part 1);
5) He/she does not have and did not have any material
business relations with the company or
associated company within the past year directly
or as a partner, shareholder, director or superior
employee of the subject having such relationship.
A subject is considered to have business relations
when it is a major supplier or service provider
(inclusive of financial, legal, counseling and
consulting services), major client or organization
receiving significant payments from the company
or its group;
6) He/she is not and has not been, during the last three
years, partner or employee of the current or
former external audit company of the company
or associated company;
7) He/she is not an executive director or member of
the board in some other company where
executive director of the company or member of
the board (if a collegial body elected by the
general shareholders' meeting is the supervisory
board) is non-executive director or member of
the supervisory board, he/she may not also have
any other material relationships with executive
directors of the company that arise from their
participation in activities of other companies or
bodies;
8) He/she has not been in the position of a member of
the collegial body for over than 12 years;
9) He/she is not a close relative to an executive
director or member of the board (if a collegial
body elected by the general shareholders'
meeting is the supervisory board) or to any
person listed in above items 1 to 8. Close relative
is considered to be a spouse (common-law
spouse), children and parents.

3.8. The determination of what constitutes independence
is fundamentally an issue for the collegial body itself to
determine. The collegial body may decide that, despite a
particular member meets all the criteria of independence
laid down in this Code, he cannot be considered
independent due to special personal or company-related
circumstances.
3.9. Necessary information on conclusions the collegial	No	At present, there are no members who comply
body has come to in its determination of whether a		with the independency criteria.
particular member of the body should be considered to be
independent should be disclosed. When a person is
nominated to become a member of the collegial body, the
company should disclose whether it considers the person
to be independent. When a particular member of the
collegial body does not meet one or more criteria of
independence set out in this Code, the company should
disclose its reasons for nevertheless considering the
member to be independent. In addition, the company
should annually disclose which members of the collegial
body it considers to be independent.
3.10. When one or more criteria of independence set out	No	At present, there are no members who comply
in this Code has not been met throughout the year, the		with the independency criteria.
company should disclose its reasons for considering a		No other group of shareholders having no
particular member of the collegial body to be independent.		relations with the company's management have
To ensure accuracy of the information disclosed in		not raised a will to have their member on the
relation with the independence of the members of the		Company's Board, so they didn't offer a
collegial body, the company should require independent		candidacy.
members to have their independence periodically re		Presently, it is expected to receive a proposal in
confirmed.		regards with an independent Board member.
3.11. In order to remunerate members of a collegial body	No	At present, there are no members who comply
for their work and participation in the meetings of the		with the independency criteria.
collegial body, they may be remunerated from the
company's funds. The general shareholders' meeting
should approve the amount of such remuneration.

Principle IV: The duties and liabilities of a collegial body elected by the general shareholders' meeting

The corporate governance framework should ensure proper and effective functioning of the collegial body elected by the general shareholders' meeting, and the powers granted to the collegial body should ensure effective monitoring of the company's management bodies and protection of interests of all the company's shareholders.

4.1. The collegial body elected by the general	Yes	The Board of Directors approves and submits
shareholders' meeting (hereinafter in this Principle		reciprocations and recommendations to a general
referred to as the 'collegial body') should ensure integrity		meeting of shareholders regarding annual
and transparency of the company's financial statements		accountability of the Company, distribution of the
and the control system. The collegial body should issue		profit, annual report of the Company, as well as
recommendations to the company's management bodies		carries out other functions.
and monitor and control the company's management
performance.
4.2. Members of the collegial body should act in good	Yes	By the Company's information, all Board
faith, with care and responsibility for the benefit and in		members act in good will vis-a-vis the Company.
the interests of the company and its shareholders with due		They are guided by the Company's interests but
regard to the interests of employees and public welfare.		not their own or any third parties seeking to
Independent members of the collegial body should (a)		maintain their independency when accepting
under all circumstances maintain independence of their		decisions.
analysis, decision-making and actions (b) do not seek and
accept any unjustified privileges that might compromise
their independence, and (c) clearly express their
objections should a member consider that decision of the
collegial body is against the interests of the company.
Should a collegial body have passed decisions
independent member has serious doubts about, the
member should make adequate conclusions. Should an
independent member resign from his office, he should
explain the reasons in a letter addressed to the collegial
body or audit committee and, if necessary, respective
company-not-pertaining body (institution).
4.3. Each member should devote sufficient time and	Yes	Each member of the collegial body fulfills his/
attention to perform his duties as a member of the		her functions properly: actively participates at the
collegial body. Each member of the collegial body should		meetings of collegial body, and devotes sufficient
limit other professional obligations of his (in particular		time to perform his/ her duties as a member of the
any directorships held in other companies) in such a		collegial body. The quorum of each meeting was
manner they do not interfere with proper performance of		regulated so the Board of Directors would be
duties of a member of the collegial body. In the event a		enabled to accept decisions constructively. In
member of the collegial body should be present in less		2012, there were 12 meetings of the Board. All
than a half of the meetings of the collegial body		Board meetings were participated by all members
throughout the financial year of the company,		of the Board.
shareholders of the company should be notified.
4.4. Where decisions of a collegial body may have a	Yes	The Company acts honestly and without bias with
different effect on the company's shareholders, the		its shareholders. The shareholders are informed
collegial body should treat all shareholders impartially		on the Company's activities in accordance with

and fairly. It should ensure that shareholders are properly		the Lithuanian legislation by announcing the
informed on the company's affairs, strategies, risk		information in annual reports, through the Central
management and resolution of conflicts of interest. The		information base and the company's website.
company should have a clearly established role of
members of the collegial body when communicating with
and committing to shareholders.
4.5. It is recommended that transactions (except	Yes	The Company's collegial body concludes
insignificant ones due to their low value or concluded		transactions according to the Articles of
when carrying out routine operations in the company		Association of the Company and Work
under usual conditions), concluded between the company		regulations of the collegial body.
and its shareholders, members of the supervisory or
managing bodies or other natural or legal persons that
exert or may exert influence on the company's
management should be subject to approval of the collegial
body. The decision concerning approval of such
transactions should be deemed adopted only provided the
majority of the independent members of the collegial
body voted for such a decision.
4.6. The collegial body should be independent in passing	No	The Company's Board members are not
decisions that are significant for the company's operations		independent from the Executive management of
and strategy. Taken separately, the collegial body should		the Company. All four board members are the
be independent of the company's management bodies.		company's employees. There is one seat left for
Members of the collegial body should act and pass		an independent member. The Board of Directors
decisions without an outside influence from the persons		pursues the Work Regulations of the Board in
who have elected it. Companies should ensure that the		order to pass decisions. They work for benefit of
collegial body and its committees are provided with		the Company, and ensure continuous rise of
sufficient administrative and financial resources to		shareholder value.
discharge their duties, including the right to obtain, in		The Company ensures that the collegial body –
particular from employees of the company, all the		the Board of Directors – is provided with
necessary information or to seek independent legal,		sufficient resources (including financial) to
accounting or any other advice on issues pertaining to the		discharge their duties, including the right to
competence of the collegial body and its committees.		obtain, in particular from employees of the
When using the services of a consultant with a view to		company, all the necessary information or to seek
obtaining information on market standards for		independent legal, accounting or any other advice
remuneration systems, the remuneration committee should		on issues pertaining to the competence of the
ensure that the consultant concerned does not at the same		collegial body and its committees.
time advice the human resources department, executive		The Remuneration Committee is not formed at
directors or collegial management organs of the company		the Company.
concerned.
4.7. Activities of the collegial body should be organized in	Yes/No	Pursuing the Law on Audit Article 52 part 1, the

a manner that independent members of the collegial body could have major influence in relevant areas where chances of occurrence of conflicts of interest are very high. Such areas to be considered as highly relevant are issues of nomination of company's directors, determination of directors' remuneration and control and assessment of company's audit. Therefore when the mentioned issues are attributable to the competence of the collegial body, it is recommended that the collegial body should establish nomination, remuneration, and audit committees. Companies should ensure that the functions attributable to the nomination, remuneration, and audit committees are carried out. However they may decide to merge these functions and set up less than three committees. In such case a company should explain in detail reasons behind the selection of alternative approach and how the selected approach complies with the objectives set forth for the three different committees. Should the collegial body of the company comprise small number of members, the functions assigned to the three committees may be performed by the collegial body itself, provided that it meets composition requirements advocated for the committees and that adequate information is provided in this respect. In such case provisions of this Code relating to the committees of the collegial body (in particular with respect to their role, operation, and transparency) should apply, where relevant, to the collegial body as a whole. 4.8. The key objective of the committees is to increase

efficiency of the activities of the collegial body by ensuring that decisions are based on due consideration, and to help organize its work with a view to ensuring that the decisions it takes are free of material conflicts of interest. Committees should exercise independent judgment and integrity when exercising its functions as well as present the collegial body with recommendations concerning the decisions of the collegial body. Nevertheless the final decision shall be adopted by the collegial body. The recommendation on creation of committees is not intended, in principle, to constrict the competence of the collegial body or to remove the matters Company established the Audit Committee complying with the 21st August 2008 Resolution No. 1K-18 of the Securities Commission. Following the above requirements, the 24th April 2009 general meeting of shareholders approved Regulations of establishment and performance of the Audit Committee, also it elected an independent member of the committee, and approved full composition of the Audit Committee. The Audit Committee is an independent, and objective committee carrying out the functions of supervision, analyzing, evaluation and consultation in order to improve general organization and create value added. The main function of the Committee is systematic and versatile evaluation, as well as encouragement of better risk management, and sufficient control and maintenance procedures resulting in submission of recommendations to the Board of Directors and management. The nomination and remuneration committees are

not formed at the Company.

No The elected Audit Committee pursues the Regulations of the Audit Committee, including supervision of preparation of financial accounts, as well as functional internal control of the company, risk management and internal audit system, consequently the Committee will submit recommendations to the general meeting of shareholders in relation with the company's annual financial accounting and related matters. The collegial body remains fully responsible for the decisions made within its competence and adopts final decisions.

considered from the purview of the collegial body itself,
which remains fully responsible for the decisions taken in
its field of competence.
4.9. Committees established by the collegial body should	Yes	The Audit Committee consists of 3 members, one
normally be composed of at least three members. In		of which is an independent member.
companies with small number of members of the collegial
body, they could exceptionally be composed of two
members. Majority of the members of each committee
should be constituted from independent members of the
collegial body. In cases when the company chooses not to
set up a supervisory board, remuneration and audit
committees should be entirely comprised of non-executive
directors. Chairmanship and membership of the
committees should be decided with due regard to the need
to ensure that committee membership is refreshed and that
undue reliance is not placed on particular individuals.
Chairmanship and membership of the committees should
be decided with due regard to the need to ensure that
committee membership is refreshed and that undue
reliance is not placed on particular individuals.
4.10. Authority of each of the committees should be	Yes	The Audit Committee pursues its duties following
determined by the collegial body. Committees should		the work regulations approved by the general
perform their duties in line with authority delegated to		meeting of shareholders. The Committee is
them and inform the collegial body on their activities and		accountable to the general meeting of
performance on regular basis. Authority of every		shareholders providing the information on the
committee stipulating the role and rights and duties of the		independency of auditing procedure.
committee should be made public at least once a year (as
part of the information disclosed by the company annually
on its corporate governance structures and practices).
Companies should also make public annually a statement
by existing committees on their composition, number of
meetings and attendance over the year, and their main

activities. Audit committee should confirm that it is
satisfied with the independence of the audit process and
describe briefly the actions it has taken to reach this
conclusion.
4.11. In order to ensure independence and impartiality of	Yes	The Audit Committee will invite the CEO of the
the committees, members of the collegial body that are		Company as well as other employees related with
not members of the committee should commonly have a		the discussed issues to their meetings. Also, the

if invited by the committee. A committee may invite or		right to communicate with shareholders.
demand participation in the meeting of particular officers
or experts. Chairman of each of the committees should
have a possibility to maintain direct communication with
the shareholders. Events when such are to be performed
should be specified in the regulations for committee
activities.
4.12. Nomination Committee.	No	There is not a Nomination Committee in the
4.12.1. Key functions of the nomination committee should		Company.
be the following:

• Identify and recommend, for the approval of the
collegial body, candidates to fill board vacancies. The
nomination committee should evaluate the balance of
skills, knowledge and experience on the management
body, prepare a description of the roles and capabilities
required to assume a particular office, and assess the time
commitment expected. Nomination committee can also
consider candidates to members of the collegial body
delegated by the shareholders of the company;
• Assess on regular basis the structure, size, composition
and performance of the supervisory and management
bodies, and make recommendations to the collegial body
regarding the means of achieving necessary changes;
• Assess on regular basis the skills, knowledge and
experience of individual directors and report on this to the
collegial body;
• Properly consider issues related to succession planning;
• Review the policy of the management bodies for
selection and appointment of senior management.

4.12.2. Nomination committee should consider proposals
by other parties, including management and shareholders.
When dealing with issues related to executive directors or
members of the board (if a collegial body elected by the
general shareholders' meeting is the supervisory board)
and senior management, chief executive officer of the
company should be consulted by, and entitled to submit
proposals to the nomination committee.
4.13. Remuneration Committee.	No	There is not a Remuneration Committee in the
4.13.1. Key functions of the remuneration committee		Company.

should be the following:

• Make proposals, for the approval of the collegial body, on the remuneration policy for members of management bodies and executive directors. Such policy should address all forms of compensation, including the fixed remuneration, performance-based remuneration schemes, pension arrangements, and termination payments. Proposals considering performance-based remuneration schemes should be accompanied with recommendations on the related objectives and evaluation criteria, with a view to properly aligning the pay of executive director and members of the management bodies with the longterm interests of the shareholders and the objectives set by the collegial body;

• Make proposals to the collegial body on the individual remuneration for executive directors and member of management bodies in order their remunerations are consistent with company's remuneration policy and the evaluation of the performance of these persons concerned. In doing so, the committee should be properly informed on the total compensation obtained by executive directors and members of the management bodies from the affiliated companies;

• Ensure that remuneration of individual executive directors or members of management body is proportionate to the remuneration of other executive directors or members of management body and other staff members of the company;

• Periodically review the remuneration policy for executive directors or members of management body, including the policy regarding share-based remuneration, and its implementation;

• Make proposals to the collegial body on suitable forms of contracts for executive directors and members of the management bodies;

• Assist the collegial body in overseeing how the company complies with applicable provisions regarding the remuneration-related information disclosure (in particular the remuneration policy applied and individual remuneration of directors);

• Make general recommendations to the executive

directors and members of the management bodies on the
level and structure of remuneration for senior
management (as defined by the collegial body) with
regard to the respective information provided by the
executive directors and members of the management
bodies.
4.13.2. With respect to stock options and other share
based incentives which may be granted to directors or
other employees, the committee should:
• Consider general policy regarding the granting of the
above mentioned schemes, in particular stock options, and
make any related proposals to the collegial body;
• Examine the related information that is given in the
company's annual report and documents intended for the
use during the shareholders meeting;
• Make proposals to the collegial body regarding the
choice between granting options to subscribe shares or
granting options to purchase shares, specifying the
reasons for its choice as well as the consequences that this
choice has.
4.13.3. Upon resolution of the issues attributable to the
competence of the remuneration committee, the
committee should at least address the chairman of the
collegial body and/or chief executive officer of the
company for their opinion on the remuneration of other
executive directors or members of the management
bodies.
4.13.4. The remuneration committee should report on the
exercise of its functions to the shareholders and be present
at the annual general meeting for this purpose.

4.14. Audit Committee.	Yes	The Audit Committee is independent, objective
		committee carrying out the functions of
4.14.1. Key functions of the audit committee should be		supervision, analyzing, evaluation and
the following:		consultation in order to improve general
• Observe the integrity of the financial information		organization and create value added. The key
provided by the company, in particular by reviewing the		function of the Committee is systematic and
relevance and consistency of the accounting methods used		versatile evaluation, as well as encouragement of
by the company and its group (including the criteria for		better risk management, and sufficient control
the consolidation of the accounts of companies in the		and maintenance procedures resulting in

group);		submission of recommendations to the general

• At least once a year review the systems of internal control and risk management to ensure that the key risks (inclusive of the risks in relation with compliance with existing laws and regulations) are properly identified, managed and reflected in the information provided;

• Ensure the efficiency of the internal audit function, among other things, by making recommendations on the selection, appointment, reappointment and removal of the head of the internal audit department and on the budget of the department, and by monitoring the responsiveness of the management to its findings and recommendations. Should there be no internal audit authority in the company, the need for one should be reviewed at least annually;

• Make recommendations to the collegial body related with selection, appointment, reappointment and removal of the external auditor (to be done by the general shareholders' meeting) and with the terms and conditions of his engagement. The committee should investigate situations that lead to a resignation of the audit company or auditor and make recommendations on required actions in such situations;

• Monitor independence and impartiality of the external auditor, in particular by reviewing the audit company's compliance with applicable guidance relating to the rotation of audit partners, the level of fees paid by the company, and similar issues. In order to prevent occurrence of material conflicts of interest, the committee, based on the auditor's disclosed inter alia data on all remunerations paid by the company to the auditor and network, should at all times monitor nature and extent of the non-audit services. Having regard to the principals and guidelines established in the 16 May 2002 Commission Recommendation 2002/590/EC, the committee should determine and apply a formal policy establishing types of non-audit services that are (a) excluded, (b) permissible only after review by the committee, and (c) permissible without referral to the committee;

• Review efficiency of the external audit process and responsiveness of management to recommendations made in the external auditor's management letter.

meeting of shareholders and the board of directors in order to implement set objectives. The Audit Committee analyses the consolidated financial information and provide their recommendations for the integrity of such information, the Committee make their recommendations regarding selection of the external auditor and inspects effectiveness of the external auditor's performance as well as the reaction of the Company's management to their recommendations which are provided by the letter to the management.

All members of the committee are furnished with complete information on particulars of accounting, financial and other operations of the company. Company's management informs the Audit Committee of the methods used to account for significant and unusual transactions.

The Audit Committee has a right to demand that the Board Chairman, Chief Executive Officer of the company, Chief Financial Officer would participate at its meetings. The committee is also entitled, when needed, to meet with any relevant person without executive directors and members of the management bodies present.

The Audit Committee will present its performance report for the general meeting of shareholders, when the annual financial reports are being approved.

4.14.2. All members of the committee should be furnished with complete information on particulars of accounting, financial and other operations of the company. Company's management should inform the audit committee of the methods used to account for significant and unusual transactions where the accounting treatment may be open to different approaches. In such case a special consideration should be given to company's operations in offshore centers and/or activities carried out through special purpose vehicles (organizations) and justification of such operations.

4.14.3. The audit committee should decide whether participation of the chairman of the collegial body, chief executive officer of the company, chief financial officer (or superior employees in charge of finances, treasury and accounting), or internal and external auditors in the meetings of the committee is required (if required, when). The committee should be entitled, when needed, to meet with any relevant person without executive directors and members of the management bodies present.

4.14.4. Internal and external auditors should be secured with not only effective working relationship with management, but also with free access to the collegial body. For this purpose the audit committee should act as the principal contact person for the internal and external auditors.

4.14.5. The audit committee should be informed of the internal auditor's work program, and should be furnished with internal audit's reports or periodic summaries. The audit committee should also be informed of the work program of the external auditor and should be furnished with report disclosing all relationships between the independent auditor and the company and its group. The committee should be timely furnished information on all issues arising from the audit.

4.14.6. The audit committee should examine whether the

company is following applicable provisions regarding the
possibility for employees to report alleged significant
irregularities in the company, by way of complaints or
through anonymous submissions (normally to an
independent member of the collegial body), and should
ensure that there is a procedure established for
proportionate and independent investigation of these
issues and for appropriate follow-up action.

4.14.7. The audit committee should report on its activities
to the collegial body at least once in every six months, at
the time the yearly and half-yearly statements are
approved.
4.15. Every year the collegial body should conduct the	No	There is no practice of collegial body assessment.

assessment of its activities. The assessment should include
evaluation of collegial body's structure, work organization
and ability to act as a group, evaluation of each of the
collegial body member's and committee's competence
and work efficiency and assessment whether the collegial
body has achieved its objectives. The collegial body
should, at least once a year, make public (as part of the
information the company annually discloses on its
management structures and practices) respective
information on its internal organization and working
procedures, and specify what material changes were made
as a result of the assessment of the collegial body of its
own activities.

Principle V: The working procedure of the company's collegial bodies

The working procedure of supervisory and management bodies established in the company should ensure efficient operation of these bodies and decision-making and encourage active co-operation between the company's bodies.

5.1. The company's supervisory and management bodies	Yes	The Company's Board of Directors is chaired by
(hereinafter in this Principle the concept 'collegial bodies'		the Board Chairman acting in accordance with the
covers both the collegial bodies of supervision and the		approved Work Regulations. The Board
collegial bodies of management) should be chaired by		Chairman is responsible for sufficient information
chairpersons of these bodies. The chairperson of a		about the meeting being convened and its agenda
collegial body is responsible for proper convocation of the		communication to all members of the body. He/
collegial body meetings. The chairperson should ensure		she also ensures order and working atmosphere
that information about the meeting being convened and its		during the meeting.

agenda are communicated to all members of the body.
The chairperson of a collegial body should ensure
appropriate conducting of the meetings of the collegial
body. The chairperson should ensure order and working
atmosphere during the meeting.
5.2. It is recommended that meetings of the company's	Yes	The company's collegial bodies should be carried
collegial bodies should be carried out according to the		out according to the schedule approved in
schedule approved in advance at certain intervals of time.		advance at certain intervals of time, i.e. not less
Each company is free to decide how often to convene		than once per three month period.
meetings of the collegial bodies, but it is recommended		5 (five) days prior a meeting each Board member
that these meetings should be convened at such intervals,		is provided with the announcement of the meeting
which would guarantee an interrupted resolution of the		to be convened and its agenda. Planned Board
essential corporate governance issues. Meetings of the		meetings are convened by the Board Chairman, in
company's supervisory board should be convened at least		his absence – the Deputy Board Chairman.
once in a quarter, and the company's board should meet at
least once a month.
5.3. Members of a collegial body should be notified about	Yes	5 (five) days prior a meeting each Board member
the meeting being convened in advance in order to allow		is provided with the announcement of the meeting
sufficient time for proper preparation for the issues on the		to be convened and its agenda. Planned Board
agenda of the meeting and to ensure fruitful discussion		meetings are convened by the Board Chairman, in
and adoption of appropriate decisions. Alongside with the		his absence – the Deputy Board Chairman.
notice about the meeting being convened, all the		The agenda might be supplemented only if all
documents relevant to the issues on the agenda of the		members of the Board of Directors present at the
meeting should be submitted to the members of the		meeting, and they all agree that the item is
collegial body. The agenda of the meeting should not be		important enough to be put on the agenda.
changed or supplemented during the meeting, unless all
members of the collegial body are present or certain issues
of great importance to the company require immediate
resolution.
5.4. In order to co-ordinate operation of the company's	No	The Company does not have a Supervisory Board
collegial bodies and ensure effective decision-making		and this statement is not applied.
process, chairpersons of the company's collegial bodies of
supervision and management should closely co-operate by
co-coordinating dates of the meetings, their agendas and
resolving other issues of corporate governance. Members
of the company's board should be free to attend meetings
of the company's supervisory board, especially where
issues concerning removal of the board members, their
liability or remuneration are discussed.

Principle VI: The equitable treatment of shareholders and shareholder rights

The corporate governance framework should ensure the equitable treatment of all shareholders, including minority and foreign shareholders. The corporate governance framework should protect the rights of the shareholders.

6.1. It is recommended that the company's capital should	Yes	As at 31st December 2012, the authorized capital
consist only of the shares that grant the same rights to		of AB Rokiskio suris amounted up to 35,867,970
voting, ownership, dividend and other rights to all their		ordinary registered shares. Nominal value of the
holders.		shares amounts to LTL 1. All company's owners
		have the same property and non-property rights,
		except treasury shares are not entitled to enjoy
		these rights. The company had bought 802,094
		treasury shares which made 2.24 per cent of the
		company's authorized capital.
		The shares with voting right equals to
		35,065,876.
6.2. It is recommended that investors should have access	Yes	Investors have access to the information
to the information concerning the rights attached to the		concerning the rights attached to the shares of the
shares of the new issue or those issued earlier in advance,		new issue or those issued earlier in advance.
i.e. before they purchase shares.
6.3. Transactions that are important to the company and	No	According to the Articles of Association of the
its shareholders, such as transfer, investment, and pledge		Company, important transactions, i.e. the
of the company's assets or any other type of encumbrance		decisions regarding investment, transference,
should be subject to approval of the general shareholders'		lease or mortgage of non-current assets whose
meeting. All shareholders should be furnished with equal		book value makes over 1/5 of the Company's
opportunity to familiarize with and participate in the		Authorized Capital, as well as the decisions
decision-making process when significant corporate		regarding execution, warranty or pledge of other
issues, including approval of transactions referred to		bodies' liabilities whose total sum is over 1/5 of
above, are discussed.		the Company's Authorized Capital, and the
		decisions to acquire non-current assets whose
		price is over 1/5 of the Company's Authorized
		Capital, do not require approbation by
		shareholders. Such resolutions (according to the
		Articles of Association) are approved by the
		Board of Directors.
6.4. Procedures of convening and conducting a general	Yes	Shareholder meetings are held in the company's
shareholders' meeting should ensure equal opportunities		office in Rokiskis, Pramonės str. 3. Usually,
for the shareholders to effectively participate at the		general meetings of shareholders are held on the
meetings and should not prejudice the rights and interests		last Friday of April. In 2012, general meeting of
of the shareholders. The venue, date, and time of the		shareholders was held on 27th April 2012.
shareholders' meeting should not hinder wide attendance

of the shareholders.
6.5. It is possible, in order to ensure shareholders living	Yes	The documents prepared for General meeting of
abroad the right to access to the information, it is		shareholders including draft resolutions of the
recommended that documents on the course of the general		meeting are available not later than 21 day prior
shareholders' meeting should be placed on the publicly		the date of general meeting of shareholders as
accessible website of the company not only in Lithuanian		required by the Law on Joint stock companies.
language, but in English and /or other foreign languages		The documents placed on the website of
in advance. It is recommended that the minutes of the		NASDAQ OMX security exchange and the
general shareholders' meeting after signing them and/or		company website are available in Lithuanian and
adopted resolutions should be also placed on the publicly		English languages.
accessible website of the company. Seeking to ensure the		Resolutions accepted by the general meeting of
right of foreigners to familiarize with the information,		shareholders including financial reports, the audit
whenever feasible, documents referred to in this		report, annual report, amendments of articles of
recommendation should be published in Lithuanian,		association etc. are announce in Lithuanian and
English and/or other foreign languages. Documents		English languages are announced via the central
referred to in this recommendation may be published on		base of regulated information of NASDAQ OMX
the publicly accessible website of the company to the		security exchange and the company website
extent that publishing of these documents is not		www.rokiskio.com
detrimental to the company or the company's commercial
secrets are not revealed.
6.6. Shareholders should be furnished with the	Yes	Shareholders of the company have the right to
opportunity to vote in the general shareholders' meeting		participate at general meeting of shareholders
in person and in absentia. Shareholders should not be		personally or appoint a representative if there is a
prevented from voting in writing in advance by		proper Power of Attorney or Agreement to pass
completing the general voting ballot.		votes according to the applicable legislation.
		Also, the Company provides its shareholders with
		the right to fill in a common voting bulletin as it
		is required by the Law on Joint Stock Companies.
6.7. With a view to increasing the shareholders'	No	This statement is not followed by the Company
opportunities to participate effectively at shareholders'		because there is not an opportunity to secure
meetings, the companies are recommended to expand use		safety of the transmitted information and it is
of modern technologies by allowing the shareholders to		impossible to identify personality of the
participate and vote in general meetings via electronic		participator and voter.
means of communication. In such cases security of
transmitted information and a possibility to identify the
identity of the participating and voting person should be
guaranteed. Moreover, companies could furnish its
shareholders, especially shareholders living abroad, with
the opportunity to watch shareholder meetings by means
of modern technologies.

Principle VII: The avoidance of conflicts of interest and their disclosure

The corporate governance framework should encourage members of the corporate bodies to avoid conflicts of interest and assure transparent and effective mechanism of disclosure of conflicts of interest regarding members of the corporate bodies.

7.1. Any member of the company's supervisory and	Yes	Management bodies conduct in a way to ensure
management body should avoid a situation, in which		there is no personal interest conflicts. There have
his/her personal interests are in conflict or may be in		not been any such situations so far.
conflict with the company's interests. In case such a
situation did occur, a member of the company's
supervisory and management body should, within
reasonable time, inform other members of the same
collegial body or the company's body that has elected
him/her, or to the company's shareholders about a
situation of a conflict of interest, indicate the nature of the
conflict and value, where possible.
7.2. Any member of the company's supervisory and	Yes
management body may not mix the company's assets, the
use of which has not been mutually agreed upon, with
his/her personal assets or use them or the information
which he/she learns by virtue of his/her position as a
member of a corporate body for his/her personal benefit or
for the benefit of any third person without a prior
agreement of the general shareholders' meeting or any
other corporate body authorized by the meeting.
7.3. Any member of the company's supervisory and	Yes	The company follows the recommendation. A
management body may conclude a transaction with the		Board member abstains from voting, when
company, a member of a corporate body of which he/she		discussing the transactions or other issues in
is. Such a transaction (except insignificant ones due to		which he/ she has certain interests.
their low value or concluded when carrying out routine
operations in the company under usual conditions) must
be immediately reported in writing or orally, by recording
this in the minutes of the meeting, to other members of the
same corporate body or to the corporate body that has
elected him/her or to the company's shareholders.
Transactions specified in this recommendation are also
subject to recommendation 4.5.
7.4. Any member of the company's supervisory and	Yes	The company follows the recommendation. A
management body should abstain from voting when		Board member abstains from voting, when

decisions concerning transactions or other issues of	discussing the transactions or other issues in
personal or business interest are voted on.	which he/ she has certain interests.

Principle VIII: Company's remuneration policy

Remuneration policy and procedure for approval, revision and disclosure of directors' remuneration established in the company should prevent potential conflicts of interest and abuse in determining remuneration of directors, in addition it should ensure publicity and transparency both of company's remuneration policy and remuneration of directors.

8.1. A company should make a public statement of the	No	The company does not announce any reports on
company's remuneration policy (hereinafter the		the remuneration system because it is regarded to
remuneration statement) which should be clear and easily		be an internal confidential document. General
understandable. This remuneration statement should be		information on the remuneration politics, average
published as a part of the company's annual statement as		wages of the Company employees according to
well as posted on the company's website.		groups and total annual payouts to the
		Company's top management are publically
		announced in the Company's consolidated annual
		report and consolidated financial accounts.
8.2. Remuneration statement should mainly focus on	Yes	As from 2004 and up to date, the Company
directors' remuneration policy for the following year and,		applies a remuneration system which conforms
if appropriate, the subsequent years. The statement should		all the statements of this point. The system is
contain a summary of the implementation of the		approved by the Company's manager, but it is not
remuneration policy in the previous financial year. Special		announced publicly.
attention should be given to any significant changes in		Information on total annual payouts to the
company's remuneration policy as compared to the		Company's top management are publically
previous financial year.		announced in the Company's consolidated annual
		report and consolidated financial accounts.
8.3. Remuneration statement should leastwise include the	No	As there is not a Remuneration Committee, the
following information:		statements are not determined.
• Explanation of the relative importance of the variable
and non-variable components of directors' remuneration;
• Sufficient information on performance criteria that
entitles directors to share options, shares or variable
components of remuneration;
• An explanation how the choice of performance criteria
contributes to the long-term interests of the company;
• An explanation of the methods, applied in order to
determine whether performance criteria have been
fulfilled;
• Sufficient information on deferment periods with regard

to variable components of remuneration;
• Sufficient information on the linkage between the
remuneration and performance;
• The main parameters and rationale for any annual bonus
scheme and any other non-cash benefits;
• Sufficient information on the policy regarding
termination payments;
• Sufficient information with regard to vesting periods for
share-based remuneration, as referred to in point 8.13 of
this Code;
• Sufficient information on the policy regarding retention
of shares after vesting, as referred to in point 8.15 of this
Code;
• Sufficient information on the composition of peer groups
of companies the remuneration policy of which has been
examined in relation to the establishment of the
remuneration policy of the company concerned;
• A description of the main characteristics of
supplementary pension or early retirement schemes for
directors;
• Remuneration statement should not include
commercially sensitive information.
8.4. Remuneration statement should also summarize and	No	The company does not announce any information
explain company's policy regarding the terms of the		on remuneration amounts or any other benefits
contracts executed with executive directors and members		received by the directors because the company
of the management bodies. It should include, inter alia,		believes this is a confidential information.
information on the duration of contracts with executive
directors and members of the management bodies, the
applicable notice periods and details of provisions for
termination payments linked to early termination under
contracts for executive directors and members of the
management bodies.
8.5. Remuneration statement should also contain detailed	No
information on the entire amount of remuneration,
inclusive of other benefits, that was paid to individual
directors over the relevant financial year. This document
should list at least the information set out in items 8.5.1 to
8.5.4 for each person who has served as a director of the
company at any time during the relevant financial year.
8.5.1. The following remuneration and/or emoluments
related information should be disclosed:

• The total amount of remuneration paid or due to the
director for services performed during the relevant
financial year, inclusive of, where relevant, attendance
fees fixed by the annual general shareholders meeting;
• The remuneration and advantages received from any
undertaking belonging to the same group;
• The remuneration paid in the form of profit sharing
and/or bonus payments and the reasons why such bonus
payments and/or profit sharing were granted;
• If permissible by the law, any significant additional
remuneration paid to directors for special services outside
the scope of the usual functions of a director;
• Compensation receivable or paid to each former
executive director or member of the management body as
a result of his resignation from the office during the
previous financial year;
• Total estimated value of non-cash benefits considered as
remuneration, other than the items covered in the above
points.
8.5.2. As regards shares and/or rights to acquire share
options and/or all other share-incentive schemes, the
following information should be disclosed:
• The number of share options offered or shares granted
by the company during the relevant financial year and
their conditions of application;

• The number of shares options exercised during the
relevant financial year and, for each of them, the number
of shares involved and the exercise price or the value of
the interest in the share incentive scheme at the end of the
financial year;
• The number of share options unexercised at the end of
the financial year; their exercise price, the exercise date
and the main conditions for the exercise of the rights;
• All changes in the terms and conditions of existing share
options occurring during the financial year.
8.5.3. The following supplementary pension schemes
related information should be disclosed:
• When the pension scheme is a defined-benefit scheme,
changes in the directors' accrued benefits under that
scheme during the relevant financial year;
• When the pension scheme is defined-contribution

scheme, detailed information on contributions paid or
payable by the company in respect of that director during
the relevant financial year.
8.5.4. The statement should also state amounts that the
company or any subsidiary company or entity included in
the consolidated annual financial report of the company
has paid to each person who has served as a director in the
company at any time during the relevant financial year in
the form of loans, advance payments or guarantees,
including the amount outstanding and the interest rate.
8.6. Where the remuneration policy includes variable	Yes	The Company applies the remuneration system
components of remuneration, companies should set limits		according to which compensation for work
on the variable component(s). The non-variable		consists of variable parts. The variable
component of remuneration should be sufficient to allow		constituents are allocated to every function
the company to withhold variable components of		according to the overall functional management
remuneration when performance criteria are not met.		system.
8.7. Award of variable components of remuneration	Yes	The variable constituents are allocated by the
should be subject to predetermined and measurable		Company's management, taking into account the
performance criteria.		results of the Company's performance, number of
		employees, market situation and other factors.
8.8. Where a variable component of remuneration is	Yes	When a variable part of compensation is
awarded, a major part of the variable component should		allocated, the biggest part of the payment of
be deferred for a minimum period of time. The part of the		variable part of compensation is reserved to the
variable component subject to deferment should be		first quarter.
determined in relation to the relative weight of the
variable component compared to the non-variable

component of remuneration.
8.9. Contractual arrangements with executive or managing	No	The variable part of compensation is only paid
directors should include provisions that permit the		when its validity is fully certain.
company to reclaim variable components of remuneration
that were awarded on the basis of data which subsequently
proved to be manifestly misstated.
8.10. Termination payments should not exceed a fixed	Yes	Termination payments are paid in accordance
amount or fixed number of years of annual remuneration,		with the statements of Work Codex of the

which should, in general, not be higher than two years of		Republic of Lithuania article 140, and the
the non-variable component of remuneration or the		statements of Corporate Agreement approved by
equivalent thereof.		the Company.
8.11. Termination payments should not be paid if the	Yes	Termination payments are not paid out if the job
termination is due to inadequate performance.		contract is terminated due to bad performance

8.12. The information on preparatory and decision	No	The company doesn't have any other
making processes, during which a policy of remuneration		remuneration system designed to the directors
of directors is being established, should also be disclosed.		except the variable part of salary which depends
Information should include data, if applicable, on		on the company's performance results, market
authorities and composition of the remuneration		situation and other factors.
committee, names and surnames of external consultants
whose services have been used in determination of the
remuneration policy as well as the role of shareholders'
annual general meeting.
8.13. Shares should not vest for at least three years after	No	Remuneration is not based on share award.
their award.
8.14. Share options or any other right to acquire shares or	No	Remuneration is not based on share award.
to be remunerated on the basis of share price movements
should not be exercisable for at least three years after their
award. Vesting of shares and the right to exercise share
options or any other right to acquire shares or to be
remunerated on the basis of share price movements,
should be subject to predetermined and measurable
performance criteria.
8.15. After vesting, directors should retain a number of	No	See point 8.13.
shares, until the end of their mandate, subject to the need
to finance any costs related to acquisition of the shares.
The number of shares to be retained should be fixed, for
example, twice the value of total annual remuneration (the
non-variable plus the variable components).
8.16. Remuneration of non-executive or supervisory	No	See point 8.13.
directors should not include share options.
8.17. Shareholders, in particular institutional shareholders,	No	Shareholders are encouraged to attend general
should be encouraged to attend general meetings where		meetings of shareholders, yet the meetings do not
appropriate and make considered use of their votes		consider issues of the directors' remuneration
regarding directors' remuneration.		system. It is considered to be a prerogative of the
		Board of Directors.
8.18. Without prejudice to the role and organization of the	No	See point 8.13.
relevant bodies responsible for setting directors'
remunerations, the remuneration policy or any other
significant change in remuneration policy should be
included into the agenda of the shareholders' annual
general meeting. Remuneration statement should be put
for voting in shareholders' annual general meeting. The
vote may be either mandatory or advisory.

8.19. Schemes anticipating remuneration of directors in	No	Schemes anticipating remuneration of directors in
shares, share options or any other right to purchase shares		shares, share options or any other right to
or be remunerated on the basis of share price movements		purchase shares or be remunerated on the basis of
should be subject to the prior approval of shareholders'		share price movements are not determined at the
annual general meeting by way of a resolution prior to		Company.
their adoption. The approval of scheme should be related
with the scheme itself and not to the grant of such share
based benefits under that scheme to individual directors.
All significant changes in scheme provisions should also
be subject to shareholders' approval prior to their
adoption; the approval decision should be made in
shareholders' annual general meeting. In such case
shareholders should be notified on all terms of suggested
changes and get an explanation on the impact of the
suggested changes.
8.20. The following issues should be subject to approval	No	Schemes anticipating remuneration of directors in
by the shareholders' annual general meeting:		shares are not determined at the Company.
• Grant of share-based schemes, including share options,
to directors;
• Determination of maximum number of shares and main
conditions of share granting;
• The term within which options can be exercised;
• The conditions for any subsequent change in the
exercise of the options, if permissible by law;
• All other long-term incentive schemes for which
directors are eligible and which are not available to other
employees of the company under similar terms. Annual
general meeting should also set the deadline within which
the body responsible for remuneration of directors may
award compensations listed in this article to individual
directors.
8.21. Should national law or company's Articles of	No	There are no share subscription transactions or
Association allow, any discounted option arrangement		grants based on share price fluctuation.
under which any rights are granted to subscribe to shares
at a price lower than the market value of the share
prevailing on the day of the price determination, or the
average of the market values over a number of days
preceding the date when the exercise price is determined,
should also be subject to the shareholders' approval.
8.22. Provisions of Articles 8.19 and 8.20 should not be	No	The employees of the company and subsidiaries

applicable to schemes allowing for participation under do not get remuneration with shares. similar conditions to company's employees or employees of any subsidiary company whose employees are eligible to participate in the scheme and which has been approved in the shareholders' annual general meeting. 8.23. Prior to the annual general meeting that is intended No See point 8.19. to consider decision stipulated in Article 8.19, the shareholders must be provided an opportunity to familiarize with draft resolution and project-related notice (the documents should be posted on the company's website). The notice should contain the full text of the share-based remuneration schemes or a description of their key terms, as well as full names of the participants in the schemes. Notice should also specify the relationship of the schemes and the overall remuneration policy of the directors. Draft resolution must have a clear reference to the scheme itself or to the summary of its key terms. Shareholders must also be presented with information on how the company intends to provide for the shares required to meet its obligations under incentive schemes. It should be clearly stated whether the company intends to buy shares in the market, hold the shares in reserve or issue new ones. There should also be a summary on scheme-related expenses the company will suffer due to the anticipated application of the scheme. All information given in this article must be posted on the company's website.

Principle IX: The role of stakeholders in corporate governance

The corporate governance framework should recognize the rights of stakeholders as established by law and encourage active co-operation between companies and stakeholders in creating the company value, jobs and financial sustainability. For the purposes of this Principle, the concept "stakeholders" includes investors, employees, creditors, suppliers, clients, local community and other persons having certain interest in the company concerned.

9.1. The corporate governance framework should assure	Yes	The corporate governance framework assures the
that the rights of stakeholders that are protected by law are		rights of stakeholders that are protected by law
respected.		are respected. The company applies a Corporate
9.2. The corporate governance framework should create		Contract with employees, and the contract is
conditions for the stakeholders to participate in corporate		signed by the CEO and Trade Union. Also it is
governance in the manner prescribed by law. Examples of		ensured the interest holders are able to participate

mechanisms of stakeholder participation in corporate
governance include: employee participation in adoption of
certain key decisions for the company; consulting the
employees on corporate governance and other important
issues; employee participation in the company's share
capital; creditor involvement in governance in the context
of the company's insolvency, etc.
9.3. Where stakeholders participate in the corporate

company's employees and raw milk suppliers in the company governance. The greatest part of shareholders is the company's employees and raw milk suppliers. The interest holders have the right to receive information required.

in governance. For example, participation of the

information.

governance process, they should have access to relevant

Principle X: Information disclosure and transparency

The corporate governance framework should ensure that timely and accurate disclosure is made on all material information regarding the company, including the financial situation, performance and governance of the company.

10.1. The company should disclose information on:	Yes	The company announces the information
• The financial and operating results of the company;		immediately via the central base of regulated
• Company objectives;		information in both the Lithuanian and English
• Persons holding by the right of ownership or in control		languages. The information is placed immediately
of a block of shares in the company;		so the information would be accessible to each
• Members of the company's supervisory and		shareholder simultaneously. In addition, the
management bodies, chief executive officer of the		company when possible provides information
company and their remuneration;		before or after trading sessions of NASDAQ
• Material foreseeable risk factors;		OMX Vilnius in order to ensure all shareholders
• Transactions between the company and connected		and investors of the Company would have equal
persons, as well as transactions concluded outside the		opportunities to get the information needed to
course of the company's regular operations;		make appropriate investment decisions. The
• Material issues regarding employees and other		company does not disclose any information
stakeholders;		possibly influencing share price prior it is
• Governance structures and strategy.		announced publicly via the central data base of
		the regulated information.
This list should be deemed as a minimum
recommendation, while the companies are encouraged not
to limit themselves to disclosure of the information
specified in this list.
10.2. It is recommended to the company, which is the	Yes	The Company's consolidated annual reports and
parent of other companies, that consolidated results of the		consolidated financial accounts disclose some
whole group to which the company belongs should be		information on the annual payments to
disclosed when information specified in item 1 of		employees, total sums annually paid to the top
Recommendation 10.1 is under disclosure.		management and amount of tantiemes paid to the

		Board members. The information on the Board
		and top management is provided separately.
10.3. It is recommended that information on the		The company's annual reports include
professional background, qualifications of the members of		information about the activities of Board
supervisory and management bodies, chief executive		members, participation in the activities of other
officer of the company should be disclosed as well as		companies as well as the amount of shares of the
potential conflicts of interest that may have an effect on		company owned by the members. Also, there is
their decisions when information specified in item 4 of		information about the average payment amounts.
Recommendation 10.1 about the members of the
company's supervisory and management bodies is under
disclosure. It is also recommended that information about
the amount of remuneration received from the company
and other income should be disclosed with regard to
members of the company's supervisory and management
bodies and chief executive officer as per Principle VIII.
10.4. It is recommended that information about the links	Yes	Also, consolidated report includes information if
between the company and its stakeholders, including		the Board of Directors or top management were
employees, creditors, suppliers, local community, as well		granted any loans, guarantees or support, as well
as the company's policy with regard to human resources,		as the information on any payments received for
employee participation schemes in the company's share		the work done at the collegial body.
capital, etc. should be disclosed when information
specified in item 7 of Recommendation 10.1 is under
disclosure.
10.5. Information should be disclosed in such a way that	Yes	The company announces the information
neither shareholders nor investors are discriminated with		immediately via the central base of regulated
regard to the manner or scope of access to information.		information in both the Lithuanian and English
Information should be disclosed to all simultaneously. It is		languages. The information is placed immediately
recommended that notices about material events should be		so the information would be accessible to each
announced before or after a trading session on the Vilnius		shareholder simultaneously. In addition, the
Stock Exchange, so that all the company's shareholders		company when possible provides information
and investors should have equal access to the information		before or after trading sessions of NASDAQ
and make informed investing decisions.		OMX Vilnius in order to ensure all shareholders
		and investors of the Company would have equal
		opportunities to get the information needed to
		make appropriate investment decisions. The
		company does not disclose any information
		possibly influencing share price prior it is
		announced publicly via the central data base of
		the regulated information.
10.6. Channels for disseminating information should	Yes	In the company's website, the company publishes

provide for fair, timely and cost-efficient or in cases		all its reports which are placed in the central
provided by the legal acts free of charge access to relevant		information base in Lithuanian and English,
information by users. It is recommended that information		including the Company's annual report, a set of
technologies should be employed for wider dissemination		financial statements and other periodical reports
of information, for instance, by placing the information on		prepared by the Company, as well as other stock
the company's website. It is recommended that		events.
information should be published and placed on the
company's website not only in Lithuanian, but also in
English, and, whenever possible and necessary, in other
languages as well.
10.7. It is recommended that the company's annual	Yes	In the company's website, the company publishes
reports and other periodical accounts prepared by the		all its reports which are placed in the central
company should be placed on the company's website. It is		information base in Lithuanian and English,
recommended that the company should announce		including the Company's annual report, a set of
information about material events and changes in the price		financial statements and other periodical reports
of the company's shares on the Stock Exchange on the		prepared by the Company, as well as other stock
company's website too.		events.

Principle XI: The selection of the company's auditor

The mechanism of the selection of the company's auditor should ensure independence of the firm of auditor's conclusion and opinion.

11.1. An annual audit of the company's financial reports	Yes	An independent audit company performs auditing
and interim reports should be conducted by an		of the Company's and its subsidiaries individual
independent firm of auditors in order to provide an		and consolidated (the group) annual financial
external and objective opinion on the company's financial		reports in accordance with International
statements.		Accounting Standards applicable in the EU. An
		independent auditing company also evaluates
		conformity of annual report to the audited
		financial statements.
11.2. It is recommended that the company's supervisory	Yes	The Board of Directors proposes an auditing firm
board and, where it is not set up, the company's board		to the general meeting of shareholders.
should propose a candidate firm of auditors to the general
shareholders' meeting.
11.3. It is recommended that the company should disclose	Yes	The Audit Company has been paid for the service
to its shareholders the level of fees paid to the firm of		to supervise tax management. Such information
auditors for non-audit services rendered to the company.		shall be provided to the general meeting of
This information should be also known to the company's		shareholders.
supervisory board and, where it is not formed, the
company's board upon their consideration which firm of
auditors to propose for the general shareholders' meeting.

AI assistant

Rokiskio Suris — Annual Report 2012

2242_10-k_2013-04-29_db1a73f6-0af5-4cc4-8f40-7562dd04c540.pdf

1. Reporting term of the prepared annual report.

2. Key information of the issuer:

3. Information on the issuer's daughter enterprises and subsidiaries

Subsidiaries of AB "Rokiškio sūris":

Co-controlled company:

Branches of AB "Rokiškio sūris":

4. Characterization of key operations of the issuer.

Daughter enterprises:

Co-controlled company:

Branches of AB "Rokiškio sūris":

5. Contracts with financial brokers

6. Trade on issuer's securities by stock exchange and other organised markets

7. Authorized capital of the issuer:

8. Limitation on transference of securities:

9. Shareholders.

Distribution of ownership according to holder groups

10. Shareholders' rights

Shareholders have the following non-economic rights:

Shareholders have the following property rights:

11. Shareholders with special control rights and description of the rights.

12. Overall limitations of voting rights.

13. Overall agreements between shareholders.

14. Employees

Management structure of the Group of AB "Rokiškio sūris"

15. Procedure for amendments of the Articles of Association

16. Transactions with related parties and significant agreements

17. Key characteristics of the securities launched to the public trading:

18. Securities listed on the official trading list

Trade on central market:

Trade in shares of AB "Rokiškio sūris" within January-December 2012

19. Capitalization of securities.

Capitalization the company's shares in 2009-2011, Eur

Indices of the Baltic markets: (2012.01.01-2012.12.31)

20. The Group's consolidated and parent company's audited financial accounts for the year 2012

21. Information on purchase of issuer's own shares

22. Legal grounds of the issuer's performance

23. Belonging to the associated organizations

24. Brief description of the issuer's history

25. Production, description of production capacities, and implementation of new products

AB "Rokiškio sūris"

UAB "Rokiškio pienas"

Subsidiary of UAB "Rokiškio pienas" Ukmergės pieninė

26. Sales and marketing

Brands as follows:

Sales markets in Jan-Dec 2011 and 2012

27. Purchase of raw milk

28. Risk factors related with the issuer's performance.

Economic factors:

Social factors:

Risk factors related to food safety issues:

Ecological:

Key environmental indices:

29. Key aspects of formation of consolidated financial accounting related with the systems of internal control and risk management

30. Financial risk monitoring

31. Information about the authorization given by the Board members

32. Key ratios of the company performance, their dynamics

33. Investment projects implemented during the last 3 fiscal years:

34. Future plans, forecasts and investments envisaged in 2013

35. Dividends paid

Table continued

Table continued

36. Management bodies of the issuer

General meeting of shareholders:

37. Committees formed in the Company

Audit Committee of AB Rokiskio suris:

Members of Audit Committee:

Key functions of Audit Committee include the following:

38. Management bodies

Management of the company:

System of bonuses for the management:

39. Members of collegial bodies

The Board of Directors of AB "Rokiskio suris"

Members of managing bodies:

Board of Directors:

Manager of the Company:

Information on the company's manager (director):

The CEO of the Company:

Rokiskio Suris Annual Report 2012