Santierul Naval Orsova S.A.

Quarterly Report • Nov 12, 2021

QUARTERLY REPORT 30 SEPTEMBER 2021

CONTENTS	PAGE
Financial end Economical indicators	2 – 4
Statement of Financial Position	5 - 6
Statement of Profit or Loss and Other Comprehensive Income	7 - 8
Statement of Changes in Equity	9
Statement of Cash Flows	10
Notes to Separate Financial Statements	11 – 52

QUARTERLY REPORT CORRESPONDING TO THE IIIrd TRIMESTER OF 2021, IN COMPLIANCE WITH THE LAW NO. 24/2017 AND TO THE ASF REGULATION NO. 5/2018 concerning the issuers of financial instruments and market operations

DATE OF THE REPORT: 10.11.2021

Name of the trading company: ŞANTIERUL NAVAL ORŞOVA S.A.; Registered office: 4, TUFĂRI Street, ORŞOVA, MEHEDINŢI County; Telephone/fax:0252/362399 0252/360648; Single registration code issued by the Trade Register: RO 1614734; Registered number with the Trade Register's Office: J25/150/03.04.1991; Code Lei: 254900UXAJ8TPIKLXG79 Subscribed and paid in share capital: 28,557,297.5 Lei Number of shares: 11.422.919 common shares, of 2,5 lei each; Regulated market where the issued securities are traded: Bucharest Stock Exchange-category Standard (symbol: SNO)

A. FINANCIAL AND ECONOMICAL INDICATORS ON THE DATE OF 30st of September 2021 (APPENDIX NO. 13 TO THE ASF REGULATION no. 5/2018)

DESCRIPTION OF THE INDICATOR	CALCULATION MANNER	RESULT
1. Indicator of current cash-deposit)	Current assets Current debts	4,40
2.Indicator of the degree of indebtness2)	Borrowed capital*100 Own capital	0 (zero)
3. Rotation speed of the debits - clients3)	Average balance clients*270 Turnover	16 DAYS
4. Rotation speed of the fixed assets4)	Turnover Fixed assets	1,29

• 1) Offers guarantees for the coverage of the current debts from the current assets. The recommended acceptable value is approximately 2.
• 2) Expresses the effectiveness of the management of credit rosk, indicating potential financing issues, of cash-deposit with influences in the fulfillment of the undertaken committments. Șantierul Naval Orșova has no crediting contract exceeding 1 year, and, subsequently, this indicator is 0 (zero)
• 3) It expresses the effectivenes of the company in collecting their account receivables, namely the number of days until the date when the debtors pay their debts towards the company
• 4) It expresses the effectiveness of the fixed assets management, by examining the turnover generated by a certain amount of fixed assets.

B. OTHER INFORMATION

In the third quarter of 2021, compared to the provisions of the BIe, the operating revenues were achieved in proportion of 86.05%. At the same time, they register an descrease of 0.74% compared to the corresponding period of last year:

58,124,000 lei
50,016,895 lei
50,392,080 lei

In accordance with the provisions of the BVC, until 30.09.2021 were completed and delivered to foreign partners 5 ships, 3 Money Maker ships of 110 m, a Gefo tank of 110.m and the second coastal ship that made the subject of the dispute with the Dutch company Veka Shipbuilding BV.

We mention that one of the ships scheduled to be delivered during this period will be completed and delivered in the fourth quarter, the main causes that generated this situation being independent of the company. Respectively, there were delays from the customer in terms of transmission of drawings and deliveries of equipment that fell into his charge, and on the other hand there were delays in the supply chain with raw materials and materials.

The epidemiological context generated by the COVID-19 pandemic had negative consequences on the result of the branch's activity, the vessel-leasing activity being the main source of income of the branch. During the analyzed period, 3 of the existing barns at the Agigea branch were not rented. For two of them, in September, rental solutions were found to internal partners.

The individual financial statements as at 30.09.2020, respectively: Statement of financial position, Statement of profit or loss and other comprehensive income, Statement of changes in equity, Statement of cash flows and Notes to the financial statements are attached to this report, with the following specifications:

• the figures from the reporting forms are expressed in lei;
• the reporting data as at 30.09.2021 were not audited by an independent external financial auditor.
• Compared to the provisions of the BIE for the third quarter of 2021, the situation of the result is as follows:

	Operational result:
	➢ BIE provided	2.100.000 lei
	➢ Realized	(676.488) lei
	Financial result:
	➢ BIE provided	150.000 lei

	➢ Realized	626.844 lei
	Gross result:
	➢ BIE provided	2.250.000 lei
	➢ Realized	(49.644) lei

In the similar period of 2020, the company made a gross profit of 3,685,009 lei.

The company's results on 30.09.2021 were mainly influenced by the increase in the prices of raw materials and basic materials but also by the low level of demand on this market of shipbuilding. Also, the lack of contracts for renting the salandas in the patrimony of the Agigea branch negatively influenced its activity, the revenues from the services provided did not cover the costs of the exploitation activity, at the end of the reporting period the result of the branch activity was negative (total gross loss of 1,268 .694 lei, higher by 93.36% compared to the loss registered in the corresponding period of 2020).

Considering the financial situation on 30.09.2021 as well as the evolution of the main indicators, analyzed in the context of the current economic and social environment generated by the coronavirus COVID-19, the company estimates that, in the remaining period until the end of the year, the premises will not be created. to fully fulfill the provisions of the BVC for the year 2021.

On 30.09.2021, the company did not have contracted bank loans, and the cash and cash equivalents were in the amount of 26,543,083 lei. The company had no outstanding obligations to suppliers, the state budget, employees and other creditors, all of which were paid within the legal / contractual term. In the 9 months of 2021, the company made expenses for the implementation of the new investments in the amount of 3,321,895 lei, compared to 3,000,000 lei provided in the BVC (degree of achievement: 110.73%). In the corresponding period of last year, expenses of this nature amounting to 2,518,706 lei were registered.

STATEMENT OF FINANCIAL POSITION AT 30 SEPTEMBER 2021

Reference		Note	30.09.2021	31.12.2020
			RON	RON
	Assets
	Fixed assets
IAS 1.54(a)	Tangible assets	14	38.063.439	37.417.314
	Freehold land and land improvements	14	1.201.941	1.201.941
	Buildings	14	16.144.981	16.999.328
	Plant and machinery, motor vehicles	14	17.209.087	16.373.915
	Fixtures and fittings […]	14	64.747	53.638
	Tangible assets in progress	14	3.442.683	2.788.492
IAS 1.54(b)	Investment property		508.019	508.019
IAS 1.54I	Intangible assets	15	3.992	6.192
	Other intangible assets	15	3.992	6.192
IAS 1.54(h)	Trade receivables and other receivables	18	10.190	417.495
IAS 1.54(o), 56	Deferred tax assets	18	12.136	79.048
IAS 1.60	Total fixed assets		38.597.776	38.428.068
IAS 1.54 (g)	Inventories	17	28.443.893	34.611.321
IAS 1.54(h)	Trade receivables and other receivables	18	7.705.861	1.185.231
IAS 1.55	Accrued expenses	18	190.975	130.348
IAS 1.54(d)	Short term investments		2.888.782	3.857.609
IAS 1.54(i)	Cash and cash equivalents	20	26.543.083	30.825.273
IFRS 5.38-40	Non-current assets held for sale		18.637	18.637
IAS 1.60	Total Current Assets		65.791.231	70.628.419
	Total Assets		104.389.007	109.056.487
	Equity
IAS 1.54I, 78I	Share capital	21	28.557.298	28.557.298
IAS 1.55, 78I	Share premium		8.862.843	8.862.843
IAS 1.54I, 78I	Reserves		51.863.381	51.777.818
	Result for the period		(559.251)	4.653.501
IAS 1.55, 78I	Retained earnings		697.040	7.743.844

STATEMENT OF FINANCIAL POSITION AT 30 SEPTEMBER 2021 (continued)

		Note	30.09.2020	01.01.2020
Reference			RON	RON
	Profit appropriation		-	(191.823)
			(3.830.789)	(4.028.932)
	Other elements of equity
	Total equity		85.590.522	97.374.549
	Liabilities
	Long-term liabilities
IAS 1.54(o), 56	Deferred tax liabilities		3.838.993	4.037.136
IAS 1.60	Total long-term liabilities		3.838.993	4.037.136
	Current liabilities
IAS 1.54(k)	Trade payables and other debts, including derivatives	19	14 . 263 .382	6.619.329
	Deferred income		89.051	215
IAS 1.54(l)	Provisions		607.059	1.025.258
IAS 1.60	Total current liabilities		14.959.492	7.644.802
	Total Liabilities		18.798.485	11.681.938
	Total Equity and Liabilities		104.389.007	109.056.487

STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME AT 30 SEPTEMBER 2021

Reference		Note	30.09.2021	30.09.2020
			RON	RON
	Continuing operations
IAS 1. 82(a)	Income	5	49.315.419	47.459.102
IAS 1.99,103	Other income	6	701.476	2.932.978
	Total Operational Income		50.016.895	50.392.080
	Expenses related to inventories	7	(17.263.361)	(17.021.444)
	Utility expenses	8	(1.134.903)	(1.019.631)
	Employee benefits expenses	9	(20.402.692)	(20.413.288)
	Depreciation and amortization expenses	14,15	(2.786.078)	(2.880.719)
	Gains/losses on disposal of property		(1.691)	(140.650)
	Increase/(Decrease) of receivables allowances and inventory write-down	10	2.331.559	2.905.997
	Increase/(Decrease) of provision expenses		418.199	599.255
IAS 1.99, 103	Other expenses	11	(11.854.416)	(9.200.050)
	Total Operational expenses		(50.693.383)	(47.170.530)
	The result of operational activities		(676.488)	3.221.550
	Financial income	12	849.139	619.488
IAS 1.82(b)	Financial expenses	12	(222.295)	(156.029)
	Net financial result		626.844	463.459
IAS 1.85	Result before taxation		(49.644)	3.685.009
	Current income tax expenses	13.a	(435.859)	(440.037)
	Deferred income tax expenses	13.a	(734.245)	(95.881)
	Specific taxation expenses		(6.836)	(6.836)
	Deferred income tax income		667.333	268.818
IAS 1.85	Result for continuing operations		(559.251)	3.411.073
IAS 1.82(f)	Result for the period		(599.251)	3.411.073
	Other comprehensive income
IAS 1.82(g)	Reevaluation of tangible assets		0	(142.228)
IAS 1.85	Other comprehensive income after taxation		0	(142.228)

STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME AT 31 MARCH 2020 (continued)

Reference		Note	30.09.2021	30.09.2020
			RON	RON
IAS 1.82 (i)	Total comprehensive income for the period		(559.251)	3.268.845
	Attributable profit
IAS 1.83(b)(ii)	Shareholders		(559.251)	3.411.073
	Profit for the period		(559.251)	3.411.073
	Total attributable comprehensive income
IAS 1.83(b)(ii)	Shareholders		(559.251)	3.268.845
	Earnings per share
IAS 33.66	Basic earnings per share		(0.05)	0,30
IAS 33.66	Diluted earnings per share		(0.05)	0,30
	Continuing operations
IAS 33.66	Basic earnings per share		(0.05)	0,30
IAS 33.66	Diluted earnings per share		(0.05)	0,30

Reference STATEMENT OF CHANGES IN EQUITY

IAS 1.108,109

		Share capital	Share premium account	Revaluation reserve	Other reserves	Retained earnings	Result for the period	Other elements of equity	Profit appropriati on	Total equity
	Balance at	28.557.298	8.862.843	28.083.462	24.108.475	7.431.918	3.205.050	(4.290.219)	(198.765)	95.760.062
	December 31, 2019
IAS 1.106(d)(i)	Loss/ Net profit for the year	-	-	-	-	3.205.050	1.448.451	-	-	4.653.501
	Profit appropriation	-	-	-	-	-	-	-	(191.823)	(191.823)
	Transfer in reserve	-	-	(350.964)	456.608	(151.624)	-	261.287	198.765	414.072
	Revaluation reserve	-	-	(519.763)	-	-	-	-	-	(519.763)
	Dividends	-	-	-	-	(2.741.500)	-	-	-	(2.741.500)
	Balance at	28.557.298	8.862.843	27.212.735	24.565.083	7.743.844	4.653.501	(4.028.932)	(191.823)	97.374.549
	December 31, 2020
IAS	Loss/ Net profit for	-	-	-	-	4.653.501	(5.212.752)	-	-	(559.251)
1.106(d)(i)	the year
	Profit appropriation	-	-	-	-	-	-	-	-
	Transfer in reserve	-	-	-	85.563	(277.386)	-	198.143	191.823	198.143
	Dividends	-	-	-	-	(11.422.919)	-	-	-	(11.422.919)
	Balance at September 30,2020	28.557.298	8.862.843	27.212.735	24.650.646	697.040	(559.251)	(3.830.789)	-	85.590.522

STATUS OF THE TREASURY CASH FLOW

IAS 1.10(d), 113	For the fiscal year completed	30.09.2021	30.09.2020
	Treasury Cash Flow for operating activities
	Profit of the period	(559.251)	3.411.073
	Adjustment for:
	Depreciation of intangible and tangible assets	2.653.767	2.685.104
	Gain/losses from the sale of the tangible assets	1.691	140.650
	Net expenses / (net income) with provisions	(418.199)	(599.255)
	Depreciation of current assets	(2.331.559)	(2.905.997)
	Expense on the current income tax	435.859	440.037
	Specific taxation expenses	6.836	6.836
	Expenses on the delayed income tax	734.245	95.881
	Deferred income tax income	(667.333)	(268.818)
	Cash Flow from operating activities before the amendment of the	(143.944)	3.005.511
	working capital
	Amendment of the working capital:
	Stocks modification	8.254.333	5.201.674
	Modification of the commercial account receivables and of other account	(6.210.102)	(17.987.745)
	receivables Modification of the advanced expenses	(60.627)	(194.127)
	Modification of the commercial debts and of other debts	7.829.877	12.386.539
	Cash flow generated from operating activities	9.669.537	2.411.852
IAS 7.35	Paid interests	(442.856)	(522.477)
7.107.357.31,32 IAS 7.10	Net cash flow from operating activities	9.226.681	1.889.375
	Treasury Cash Flow from investment activities
IAS 7.31	Cashed interests	19.911	83.349
IAS 7.16(a)	Tangible and intangible assets acquisition	(3.321.895)	(2.526.574)
	Short term investments	968.827	3.819.691
IAS 7.10	Net cash used in investment activities	(2.333.157)	1.376.466
	Treasury cash flow from financing activities
IAS 7.17(d)	Paid dividends	(11.175.714)	(2.669.407)
IAS 7.10	Net cash from (used in) financing activities	(11.175.714)	(2.669.407)
	Net increase/decreases of the cash flow and of the cash flow equivalents	(4.282.190)	596.434
	Cash Flow and equivalents from 1st of January Cash flow and cash flow equivalents at 30th of September	30.825.273 26.543.083	13.939.382 14.535.816

IAS 1.10(e) 1. Reporting company

• IAS 1.138 (a),(b) Şantierul Naval Orşova S.A. is a company headquartered in Romania. The registered office address of the Company is: Tufari Street, no.4, Orşova, Mehedinți county.
• IAS 1.51(a)-(c) The separate financial statements in accordance with IFRS have been prepared for the period 01.01-30.09.2021. The Company's main activity is: construction of ships and floating structures (NACE code: 3011).
• IAS 1.112(a) 2. Basis of preparation

a. Statement of compliance

• IAS 1.16 The company has prepared the annual financial statements for the period 01.01-30.06.2021 in accordance with International Financial Reporting Standards as adopted by European Union, applicable to companies whose securities are admitted to trading on a regulated market, according to the Order of the Minister of Finance no. 881/2012 regarding the application of International Financial Reporting Standards by companies whose securities are admitted to trading on a regulated market and the Order of the Minister of Finance no. 2844/2016 approving the Accounting Regulations in accordance with International Financial Reporting Standards applicable to companies whose securities are admitted to trading on a regulated market, including subsequent amendments and additions.
• IAS.10.17 The financial statements have been authorized for issue by the Board of Directors on November 10th , 2021.

The financial statements have been prepared using the historical cost basis except the following significant items from the statement of financial position, for which the Company has used the fair value model:

• IAS 1.117(a) Investment properties
  • Buildings
  • Naval means of transport.

b. Functional currency and presentation currency

IAS1.51(d),(e) These financial statements are presented in RON, which is also the functional currency of the Company. All financial information presented in RON, rounded to 0 decimal places. All financial information presented in RON, without decimals rounded (rounding the RON fractions over 50 money, including the neglect of money fractions to 50). Where amounts are presented in other currency than RON, it will be specified accordingly.

IAS 1.112(a) 2. Basis of preparation (continued)

c. Professional judgements and key assumptions

The preparation of financial statements in accordance with IFRS requires the use of management's professional judgment, estimates and assumptions which affects the application of accounting policies and the reported value of assets, liabilities, income and expenses. Actual results may differ from estimated values.

The estimates and assumptions are reviewed regularly. Revisions of estimates are recognized in the period in which the estimate was revised and in future periods affected by the change.

d. New International Financial Standards not applied by the Company

The entity does not apply some IFRS or new stipulations regarding IFRS issued, but not in effect at the date of the financial statements. The company cannot estimate the impact of applying these stipulations and intends to apply them when they come into force. Among the issued, but not adopted standards, the company will not face the situation to prospectively apply neither of them. These are:

• IFRS 17 "Insurance Contracts", issued on 18 May 2017, with effect from 1 January 2023.
• Amendments to IFRS 4 "Insurance Contracts", issued on 25 June 2020, with effect from January 1, 2021
• Amendments to IFRS 9, IAS 39, IFRS 4 and IFRS 16 "Interest Rate Benchmark Reform" as of 27 August 2020, with effect from 1 January 2021.
• Amendments to IAS 1, Classification of short-term or long-term debts, effective on 1 January 2022."
• Amendments to IAS 16, Tangible assets :receipts before intended use, with entry into force on 1 January 2022."
• Amendments to IAS 37, Onerous Contracts-Cost of contracting, effective on 1 January 2022."
• Annual improvements to IFRS 2018-2020 standards, effective on 1 January 2022.

IAS 1.112(a) 2. Basis of preparation (continued)

e. Presentation of financial statements

IAS 8.28(f) The Company applies IAS 1 Presentation of Financial Statements (2007) revised, which has been enforced on 1 January 2009. As a result, the Company presents in the Statement of Changes in Equity all changes related to shareholders' equity, while changes in equity unrelated to shareholders are presented in the Statement of Comprehensive Income.

Comparative information has been presented so that they are in accordance with the revised standard. As the impact of change in accounting policy is reflected only on presentation aspects, there is no impact on earnings per share.

IAS 1 Presentation of Financial Statements is basis for the financial statements presentation to ensure comparability both with the entity's financial statements for previous periods and with the financial statements of other entities.

The Company has adopted a presentation based on liquidity in the Statement of Financial Position and a presentation of income and expenses according to their nature in the Statement of Comprehensive Income, considering that these methods of presentation provide more relevant information than other methods that have been permitted by IAS 1.

IAS 1.57 The aggregation method is optional depending on the manner in which the Company's management considers relevant information for the presentation of the financial position, respectively financial performance.

Separate financial statements are prepared using the historical cost principle, except for buildings, means of shipping and property investments reclassified in accordance with IAS 40 which are presented at their fair value.

For assets and liabilities that were presented at their fair value the company has applied IFRS 13.

Expenses representing inventories consumption, depreciation of fixed assets, interest expenses, employee expenses etc. and which according to the IFRS stipulations, are included in some assets value, are recognized during the period depending on their nature. Complementarily, the accounting records related to assets in progress, on recognize of the related income accounts.

In preparation of the annual accounting reports, as well as those submitted during the year to the territorial units of the Ministry of Public Finance, which are prepared in accordance with the format established by the Ministry of Public Finance, the Company which, according to IAS 1, has chosen to present the analysis of expenses using a classification based on their nature, does not present either the value of these expenses or the value of the corresponding revenues as it is stipulation by OMFP 2844 of December 12, 2016 for approving the Accounting Regulations compliant with International Financial Reporting Standards.

Reference	NOTES TO SEPARATE FINANCIAL STATEMENTS IN ACCORDANCE WITH IFRS
IAS 1.112(a)	2. Basis of preparation (continued)
		f. Standards and interpretations available in the current period
	The following standards, issued by the International Accounting Standards Board and adopted by the European Union, are available in the current period:
IAS 1	Presentation of financial statements	Fundamental Accounting Principles, structure and content of financial statements, mandatory posts and the concept of true and fair view, completed with amendments applicable from 1 January 2013.
IAS 2	Inventories	Defining of the accounting process applicable to inventories in the historical cost system: evaluation (first in - first out, weighted average cost and net realisable value) and the perimeter of allowed costs.
IAS 7	Statement of Cash Flows	Analysis of cash variations, classified into three categories: cash-flows from operating activities, cash-flows from investing activities, cash-flows from financing activities.
IAS 8	Accounting policies, Changes in Accounting Estimates and Errors	Defining the classification, the information that need to be disclosed and the accounting treatment of certain items in the income statement.
IAS 10	Events after the reporting period	Requirements for when events after the reporting period should generate an adjustment to the financial statements: definitions, terms and conditions, particular cases (dividends)
IAS 12	Income Taxes	Definition of tax accounting processing on the period result and detailed stipulations on deferred taxes, supplemented by amendments applicable from 1 January 2013.
IAS 16	Property, plant and equipment	Accounting treatments, net book value calculation and relevant principles regarding depreciation for most types of property, plant and equipment.
IAS 19	Employee benefits	Accounting principles regarding employee benefits: short and long term benefits, post-employment benefits, advantages on equity and allowances on termination of employment, with revisions made in 2011, applicable from January 1, 2013.

IAS 20	Accounting for Government Grants and Disclosure of Government Assistance	Accounting principles for direct or indirect public aid (clear identification, concept of fair value, restraining subsidized connection etc.).
IAS 21	The Effects of changes in Foreign Exchange Rates	Accounting treatments of abroad activities, foreign currency transactions and restating financial statements of a foreign entity.
IAS 23	Borrowing Costs	The definition of borrowing costs and accounting treatments: the notion of qualifying asset, how to capitalize borrowing costs in the amount of qualifying assets.
IAS 24	Related Party Disclosures	Details of related party relationships and transactions (legal and natural persons) who exercises control or significant influence over one of the group's companies or the management.
IAS 26	Accounting and Reporting by Retirement Benefit Plans	Principles and information on the retirement schemes (funds), distinguishing defined contribution schemes and defined-benefit.
IAS 27	Separate Financial Statements	IAS 27 outlines when an entity must consolidate another entity, how to account for a change in ownership, how to prepare separate financial statements, and related disclosures. The financial statements prepared by the company for year ended 31 December, 2014 are separate financial statements, therefore, consolidated financial statements are not applicable in this case. The Transilvanian Financial Investment Company, headquartered in Braşov, Nicolae Iorga Street, No. 2, helds, in present, 49,9998% of the share capital of SC Şantierul Naval Orşova SA, so, they have obligation to prepare the consolidated financial statements.

IAS 28	Investments in Associates	Defining the evaluation and information principles regarding investments in associates, except those held by:
		a) Venture capital organizations
		b) Mutual funds, unit trusts and similar entities, including insurance funds with an investment component which are considered to be at their fair value through profit or loss or classified as held for trading and accounted in accordance to IAS 39.
IAS 29	Financial Reporting in Hyperinflationary Economies	The financial statements of an entity whose functional currency is the currency of a hyperinflationary economy should be presented in the current unit of measure at the financial statement preparation date, meaning non-monetary elements should be restated using a general price index from the date of purchase or contribution. IAS 29 provides that an economy is considered to be hyperinflationary if, among other factors, the cumulative index of inflation exceeds 100% over a period of three years. Continuous decrease of inflation and other factors related to the characteristics of the economic environment in Romania indicates that the economy whose functional currency was adopted by the Company, ceased to be hyperinflationary, affecting periods beginning 1 January 2004. Thus, amounts expressed in the measuring unit, current at 31 December 2003 are treated as the basis for the carrying amounts in the financial statements of the Company.
IAS 32	Financial instruments: presentation	Rules of presentation (classification of debt equity, expenses or income/equity).
IAS 33	Earnings per Share	Principles of determination and representation of earnings per share.
IAS 36	Impairment of Assets	Key definitions (recoverable amount, fair value less costs of disposal, value in use, cash-generating units), the frequency of impairment tests, accounting for the impairments, and for goodwill impairment.
IAS 37	Provisions, Contingent Liabilities and Contingent Assets	Defining provisions and approach of estimating provisions, individual cases examined (including the problem of restructuring).

IAS 38	Intangible Assets	Definition and accounting treatments for intangible assets, recognition and measurement policies on the processing costs for research and development etc.
IAS 40	Investment Property	Establishing the evaluation method: fair value model or cost model, transfers between different categories of assets etc.
IFRS 1	First-time Adoption of International Financial Reporting Standards	The procedures for financial statements according to IAS / IFRS optional exemptions and mandatory exceptions to retrospective application of IAS / IFRS, supplemented by amendments applicable from 1 January 2013.
IFRS 5	Non-current Assets Held for Sale and Discontinued Operation	Defining an asset held for sale and discontinued operations, and the, evaluation of these elements.
IFRS 7	Financial Information: Disclosures	Financial information related to financial instruments are referring primarily to: (i) information about the significance of financial instruments; and (ii) information about the nature and extent of risks arising from financial instruments, supplemented by amendments applicable from 1 January 2013.
IFRS 9	Financial instruments	The Standard includes requirements for recognition and measurement, impairment, derecognition and general hedge accounting of financial instruments. The version of IFRS 9 issued in 2014 supersedes all previous versions and is mandatorily effective for periods beginning on or after 1 January 2018 with early adoption permitted.

IFRS 10	Consolidated Financial Statements	Establishing principles for the presentation and preparation of consolidated financial statements when an entity controls one or more other entities.
IFRS 11	Joint Arrangements	Establishing principles for financial reporting for entities that hold interests in jointly controlled commitments
IFRS 12	Disclosure of Interests in Other Entities	Requires an entity to disclose information that will enable users of its financial statements to evaluate: the nature and risks associated with interests held in other entities; and the effects of those interests on the financial position, financial performance and its cash flows.
IFRS 13	Fair value measurement	The definition of fair value, establishing, in a single IFRS, a framework for measuring fair value, requiring the presentation of information on fair value.
IFRS 15	Revenue from Contracts with IFRS 15 specifies how and when an IFRS reporter will Customers recognise revenue as well as requiring such entities to provide users of financial statements with more informative, relevant disclosures. The standard provides a single, principles based five-step model to be applied to all contracts with customers. IFRS 15 was issued in May 2014 and applies to an annual reporting period beginning on or after 1 January 2018. On 12 April 2016, clarifying amendments were issued that have the same effective date as the standard itself.
IFRS 16	Leasing contract	Its objective is to standardize the way in which financial and operational leasing contracts are recognized in order to have a better comparability in the financial statements between the entities that use different types of contracts.

IAS 1.112(a) 3. Significant accounting policies

117(a)

The accounting policies presented below have been applied consistently in all periods presented in these financial statements by the Company, except for matters described in note 2 (e) of changes in accounting policies.

IAS 1.41 Certain comparative amounts have been reclassified to conform with current year presentation.

a. Foreign currency

(i) Transactions in foreign currency

The Company's foreign currency transactions are registered at exchange rates communicated by the National Bank of Romania ("NBR") for the transaction date. Foreign currency balances are converted in RON at the exchange rates communicated by NBR for the balance sheet date. Gains and losses resulting from the settlement of transactions in a foreign currency and the conversion of monetary assets and liabilities denominated in foreign currencies are recognized in profit or loss in the financial result.

b. Financial instruments

(ii) Share capital

The share capital may be increased or reduced on the basis of decision of the extraordinary General Assembly of shareholders, under the conditions and in accordance with law No. 31/1990, company law, republished. Prior to any capital increase by subscription of new consideration, the company will proceed to update the value of tangible and intangible fixed assets owned. Ordinary shares are classified as equity.

c. Tangible Assets

IAS 16.73 (a) (i) Recognition and evaluation

Tangible assets are initially measured at cost, (those purchased from suppliers) or if the input value received as a contribution in kind to the establishment of share capital or increase of share capital.

For subsequent recognition of plant, naval means of transport and investment properties, the company has opted for the revaluation model (fair value model).

IAS 1.112(a) 3. Significant accounting policies (continued)

117(a)

Some of the tangible non-current assets were revalued based on government decisions ("GD") no. 945/1990, no. 26/1992, no. 500/1994, no. 983/1998, no. 403/200 and no. 1553/2003 by indexing the historical cost with indices prescribed in the respective government decisions. Increases of the tangible non-current assets' value resulting from these revaluations were initially credited to revaluation reserves and thereafter, except for the reevaluation made under GD. 1553/2003, in equity, in accordance with the respective government decisions. GD 1553/2003 foresaw the need to adjust the index value by comparing the utility value and market value. At 31 December 2006, the Company proceeded to review the value of buildings and special constructions using the opinion of specialists employed in the Company.

On 31 December 2007, the Company has not proceeded to review the value of fixed assets at the Orşova headquarters, instead Agigea Branch conducted a revaluation of fixed assets from the structures and ships category, before the merger, for the old company: SC Servicii Construcţii Maritime SA Agigea. During the years 2007, 2008 and 2009 were recorded entries in the technological equipment category and other intangible assets category which led to a presentation in the financial statements, of the assets from these categories both at historical cost indexed in accordance with government decisions (" GD "), which have been applied to date, as well as historical cost.

At 31 December 2009 the Company revalued the buildings and special constructions using the opinion of an independent external evaluator.

At 31 December 2010 and 31 December 2011 the Company has not made any revaluations of tangible assets held.

On 31 December 2012, the Company proceeded to the revaluation of naval buildings and vehicles, both at headquarters in the town of Orşova, as well as at Agigea branch using the opinion of an independent external evaluator.

On 31 December 2013, the Company revalued naval vehicles, both at headquarters in the town of Orşova, as well as at Agigea branch using the opinion of an independent external evaluator.

On 31 December 2014, the evaluated naval vehicles, using the opinion of an independent external evaluator.

On 31 December 2015, the Company proceeded to the revaluation of naval buildings and vehicles, both at headquarters in the town of Orşova, as well as at Agigea branch using the opinion of an independent external evaluator.

On 31 December 2016, the Company proceeded to the revaluation of buildings and naval vehicles amounted to the nature of shipping assets located at Agigea branch using the opinion of an independent external evaluator.

IAS 1.112(a) 3. Significant accounting policies (continued)

117(a)

On 31 December 2017, the company proceeded to the revaluation of tangible assets such as naval vehicles amounted to the nature of shipping assets located in the branch Agigea using the opinion of an independent external evaluator.

On December 31, 2018, the Company proceeded to reevaluate tangible assets such as shipbuilding buildings and means of transport both at the head office in Orşova and at Agigea branch using the opinion of an independent external evaluator.

On December 31, 2019, the Company proceeded to reevaluate tangible assets such as shipbuilding buildings and means of transport located in the branch Agigea using the opinion of an independent external evaluator.

On December 31, 2020, the Company proceeded to reevaluate tangible assets such as shipbuilding buildings and means of transport located at the branch Agigea using the opinion of an independent external evaluator.

Regarding the accounting treatment of revaluation differences, these were made in accordance with IAS 16 as follows:

If the carrying amount of an asset is increased as a result of a revaluation, the increase shall be recognized in other comprehensive income and accumulated in equity under the heading of revaluation surplus. However, the increase shall be recognized in profit or loss to the extent that it reverses a revaluation decrease of the same asset previously recognized in profit or loss.

If the carrying amount of an asset is impaired as a result of a revaluation, the decrease shall be recognized in profit or loss. However, the decrease shall be recognized in other comprehensive income to the extent that the revaluation surplus shows a credit balance for the asset. Reduction recognized in other comprehensive income reduces the amount accumulated in equity under the heading of revaluation surplus.

The Company has used the net value model. The amount of the revaluation surplus was credited to revaluation reserve balance for those non-current assets which fair value was higher than the net book value. For the non-current assets which fair value has been less than the carrying amount, firstly the revaluation surplus has been decreased and after that if necessary it has been reflected as an operating expense in the profit and loss statement.

IAS 1.112(a) 3. Significant accounting policies (continued)

117(a)

Maintenance and repairs of tangible assets are recorded as an expense when incurred. Significant improvements of tangible non-current assets that increase the value or useful life or significantly increase the capacity to generate economic benefits are capitalized as asset. Assets that have the nature of inventory objects, including tools are recorded as an expense when purchased and are not included in the account value of the tangible assets.

(ii) Reclassification to investment property

The transfer to or from investment properties shall be made if, and only if, there is a change in use.

(iii) Depreciation of tangible non-current assets

Depreciation is the equivalent to irreversible impairment of an asset, as a result of normal use, natural factors, technical progress or other causes. Fixed assets' depreciation shall be accounted as an expense (recognized in profit or loss).

The company uses straight-line depreciation method for all tangible assets owned, by dividing the book value equally, over its useful life. The depreciation method is applied consistently to all assets of the same type and with identical conditions of use. If tangible assets are placed in conservation, the company did not account the depreciation expense, instead at the end of the period, the company will record a corresponding expense adjustment for the impairment of the asset. The degree of impairment will be determined as much as possible by a certified evaluator. A significant change in the conditions of use of tangible assets or aging may justify a revision of the useful life. Also, if the tangible non-current assets are placed in conservation (their use is discontinued for a long period), the useful life can be revised.

The residual value and service life shall be reviewed at least at each financial year end.

Depreciation is calculated on the fair value, using the straight-line method over the estimated useful life of the assets as follows:

Asset	Years
Constructions	5 - 45
Equipment	3 - 20
Other equipment and furniture	3 - 30

Lands are not a subject of depreciation, as they are deemed to have an indefinite life.

IAS 1.112(a) 3. Significant accounting policies (continued)

117(a)

The management continually evaluates the development plan. The effect of lifetime review, based on GD. 2139/2004, was reflected in the depreciation expense in the year 2005 and in future periods in the amount of depreciation expenses without any temporary differences.

(iv) Derecognition

The account value of a fixed asset shall be derecognised:

• when disposed, or

• when no future economic benefits are expected from its use or disposal.

The gain or loss arising from the derecognition of a fixed asset shall be included in profit or loss when the item is derecognised. Gains shall not be classified as revenue.

d. Intangible Assets

• (1) Cost
• (i) Software

Costs for the development or maintenance of computer software programs are recognized as an expense when they occur. Costs that are directly associated with identifiable and unique products, controlled by the Company and will probably generate economic benefits exceeding costs for a period longer than one year are recognized as intangible assets. Direct costs include the development team staff costs and an appropriate proportion of overhead expenses.

Expenditure which results in extending the useful life and increasing the benefits of software over the initial specifications are added to the original cost. These costs are capitalized as intangible assets if they are not part of tangible assets.

(ii) Other intangible assets

All other intangible assets are recognized at cost.

Intangible assets are not revalued.

IAS 1.112(a) 3. Significant accounting policies (continued)

117(a)

• (2) Amortization
• (i) Software

Software development costs capitalized and they are amortized using the straight-line method over a period between 3 and 5 years.

(ii) Other intangible assets

Patents, trademarks and other intangible assets are amortized using the straight-line method over their useful life. Software licenses are amortized over a period of 3 years.

e. Investment property

An investment property is a real property (land or a building - or part of a building - or both) owned rather to earn rentals or for capital appreciation or both, rather than:

• (a) used for production or supply of goods or services or for administrative purposes; or
• (b) to be sold in the ordinary course of business.

For the evaluation after recognition, the company uses the fair value model, this accounting treatment has been applied to all investment properties.

A gain or loss arising from a change in fair value of investment property shall be recognized as an income or as an expense in the statement of comprehensive income for the period.

In determining the fair value of investment property, the company uses the services of certified values.

f. Inventories

Inventories are assets:

• Held for sale in the ordinary course of business;
• In process for sale in the ordinary course of business;
• Raw materials and consumables

IAS 1.112(a) 3. Significant accounting policies (continued)

117(a)

Measurement of inventories

Inventories are required to be stated at the lower value between cost and net realizable value. Inventories should not be reflected in the statement of financial position an amount greater than the amount that can be obtained through their sale or use. In this case, the inventories value should be decreased to the net realizable value by reflecting a write-down.

Cost of inventories

The primary basis for accounting inventories is the cost .

The cost of inventories should comprise all costs of acquisition and processing and other costs incurred in bringing the inventories to the shape and place in which they are currently.

Price differences over the cost of acquisition or production should be disclosed separately in the accounts and are recognized in cost of the asset.

Regarding the method of valuation, the company used, until December 31, 2010, the weighted average cost method, but starting from January 1, 2011, the company is using the first-in - first out method.

The cost of finished goods and work in progress includes materials, labor and indirect production costs associated. Where necessary, adjustments are made for wasted or obsolete inventories. The net realizable value is calculated as the selling price less costs to complete and costs necessary to make the sale

IAS 1.112(a) 3. Significant accounting policies (continued) 117(a)

g. Impairment

(i) Financial assets (including receivables)

A financial asset or group of financial assets is impaired if, and only if, there are any objective evidence of impairment arising as a result of one or more events that occurred after the initial recognition of the asset, and these events have an impact on future cash flows of the financial asset or group of financial assets that can be estimated reliably. On each financial year date, the company examines whether there is any objective evidence that the financial asset or a group of financial assets is impaired. The loss is given by the difference between the asset's book value and the present value of future cash flows using the effective interest rate of the financial asset at initial recognition.

If in a subsequent period, an event occurring after the recognition of the impairment will determine an increase of the asset's value, the impairment will be reversed.

h. Employee benefits

The Company makes payments to pension funds, health funds, unemployment funds, allowances and vacations for all staff. These expenses are recognized in the statement of comprehensive income for the period covered. At retirement, the company granted, as a stimulant, between one and four salaries to every person who ceases contractual relationship with the company.

The Company does not operate any other pension plan or retirement benefits so it has no other obligations in respect of pensions.

During the year, according to the collective labor agreement, depending on the possibilities of the company, employees can receive awards, financial aid for deaths in the family, serious and incurable illness etc.

i. Provisions

Provisions are recognized when the Entity has a present legal or constructive obligation, arising from past events, the settlement of which is expected to result in an outflow from the entity of resources embodying economic benefits and when a reliable estimate can be made of its amount.

IAS 1.112(a) 3. Significant accounting policies (continued)

117(a)

(1) Provisions for annual vacations and other similar staff rights.

Company debt regarding annual employee vacations is recognized in proportion to the duration of untaken vacation days by the end of the year. At the balance sheet date, a provision for the estimated obligation is recognized, provision which includes both the actual amount of untaken vacation days and related social contributions. Also, for the retirement of employees who are qualified for this matter, the company established a provision according to the collective agreement stipulations through the valid period.

(2) Provisions for litigation

For those pending lawsuits, in which the company is the defendant and courts have not issued a final and executory judgment, the company made provisions for the amounts estimated. The amounts paid to the company customers, for any damage caused to the ship during transport, and which have failed to be recovered from the insurance company which issued the insurance policy and for whom there is a pending lawsuit, are treated similarly.

(3) Provisions for guarantees

For river vessels produced by the Company, it is stipulated in the export contracts that the seller is obliged to guarantee the proper execution, for a period of 6-9 months from date of sale (ownership transfer), depending on the complexity of the ships.

Provisions made for this purpose are based on calculation of the average share of total claims paid customer deliveries during the last period (previous year).

IAS 1.112(a) 3. Significant accounting policies (continued)

117(a)

j. Revenue

Revenue refers to goods sold and services rendered.

Sales revenues include sales of ships and services provided (rentals and ship repairs) made in the ordinary course of business (excluding value added tax).

Revenue is recognized upon delivery of goods to the buyer or carrier, delivery against invoice, and for export products, after being charged and all the customs formalities are completed, or delivered to the place specified in the contract (port of destination), with the transfer of risks to the buyer.

Revenue is measured at the fair value of the counter performance received or to receive.

Interest incomes are recognized using the effective interest method in proportion to the relevant period of time, based on the principal and the effective rate until the maturity date or for a shorter period if this period is linked to the transaction costs, when it is established that the company will obtain such income.

IFRS 7.20,24 k. Financial income and expenses

Interest income is recognized as the income generates, on an accrual basis using the effective interest method in proportion to the relevant time, based on the principal and the effective rate over the period to maturity or a shorter period if this period is link to transaction costs, when it is established that the company will obtain such income.

Income from financial assets or dividends receivable from entities in which the Company is a shareholder, are recognized in the financial statements of the financial year in which they are approved by the General Meeting of each entity.

l. Income tax

The Company records current income tax using the taxable income from tax reporting, determined by the relevant Romanian legislation.

Income tax obligation for the reporting period and prior periods is recognized to the extent that is not paid.

If the amounts paid on the current and prior periods exceed the amounts due for those periods, the excess is recognized as recoverable amount.

IAS 1.112(a) 3. Significant accounting policies (continued)

117(a)

Recognition of deferred tax assets and liabilities

Deferred income tax is, using the balance sheet method, based on temporary differences arising between the tax bases of assets and their carrying amount. Deferred tax assets are recognized to the extent that there is the possibility of achieving future taxable profit from which the temporary differences can be recovered.

4. Determination of fair value

Certain accounting policies of the Company and disclosure requirements demand the determination of fair value for both financial and non-financial assets and liabilities. Fair values were determined for evaluation and / or disclosure purposes based on the methods described below. Where appropriate, additional information about the assumptions used in determining the fair value are presented in the notes that are specific to the asset or the liability.

In the assessment of tangible and intangible assets, fair value measurement is an option. Fair value assessment is made for categories of assets and is treated as a revaluation. The excess resulting from revaluation directly affects equity, unless previously it was recognized as a revaluation loss. Revaluation losses affect the statement of comprehensive income, unless there is an added value previously accounted directly in equity. There are differences between the two asset structures in terms of how to determine the fair value.

IAS 16 "Property, plant and equipment" asserts that: "After recognition as an asset, an item of tangible assets whose fair value can be measured reliably shall be carried at a revalued amount, representing its fair value at the revaluation date minus any subsequent accumulated depreciation and any accumulated impairment losses. Revaluations shall be made with sufficient regularity to ensure that the carrying amount does not differ significantly from that which would be determined using fair value at the balance sheet date." [9]

IAS 38 "Intangible Assets" indicates: "The purpose of revaluations under this standard, fair value shall be determined by reference to an active market".[10]

4. Determination of fair value (continued)

If IAS 16 "Property, plant and equipment" allows the determination of fair value through other methods if there isn't an active market, IAS 38 "Intangible Assets" narrow the assets that can be revalued, showing that only the assets for which an active market exists, can be revalued.

A special structure of non-current assets is the investment property. IAS 40 "Investment Property" offers two options for their evaluation: cost model or fair value model. As compared to IAS 16" Property, plant and equipment", where, if cost model is applicable, entities are only encouraged to disclose the fair value in the notes, IAS 40 "Investment Property" requires the estimation of fair value, for evaluation (fair value model) or to present in the notes (cost model).

For in assets held for continuing use, it can sometimes be difficult to estimate fair value minus costs of disposal. In the absence of a reliable basis for estimating the amount that an entity could obtain, from the sale of these assets in an arm's length transaction between knowledgeable, willing parties, IAS 36 "Impairment of Assets" indicates that the entity may use the asset's value as its recoverable amount (fair value is equal with the value in use).

As of January 1, 2013 requirements are applicable to the valuation of assets and liabilities at fair value under IFRS 13 "Fair Value Measurement". IFRS 13 applies to assets and liabilities held by an entity for which, in accordance with other standards, it is required or permitted a fair value measurement or disclosure about fair value is required.

IFRS 13 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.. The price used to assess the asset or liability at fair value is not adjusted by the amount of transaction costs because they are not a feature of the asset or liability, but a feature of the transaction.

Fair value assessment of an asset or liability considers the characteristics of the asset or liability which that market participants would consider in determining the price of the asset or liability at the measurement date.

Fair value measurement is performed on the assumption that an asset or liability is traded between market participants according to the normal conditions of sale of an asset or the transfer of a liability that characterizes the market at the measurement date. A normal transaction involves access to the market for a period that precedes evaluation enabling typical marketing activities and usual for those trading the respective assets or liabilities.

5. Incomes

	Total	49.315.419	47.459.102
IAS 18.35(b) (i) IAS 18.35(b) (ii)	Sales of goods Rendering of services	46.011.815 3.303.604	44.761.985 2.697.117
		30.09.2021	30.09.2020

The revenues realized in the period 01.01-30.09.2021 are higher by 3.91% compared to those of the corresponding period of last year, mainly due to the increase of revenues from the sale of ships built at the main headquarters in Orsova. During this period, the Company completed and handed over to external customers a number of 5 ships (4 ships in the corresponding period of 2020). Of these, 4 ships were built and completed this year, and one is the second coastal ship, which has been the subject of litigation with the Dutch company VEKA.

The market for river / sea shipbuilding is still weak, but the company has covered production capacity until the end of the year. Although it does not represent a significant percentage in turnover, the provision of services increased by 22.49%, and this increase compared to the previous year was mainly due to the ship repair activity at the Agigea branch. The main client was Navrom Galați. These presentations are made by the Company in accordance with IFRS 8.

6. Other incomes

	30.09.2021	30.09.2020
Income from rents (other than rent real estate investments)	630.768	1.508.451
Income from asset salles	-	1.407.032
Other operational incomes	70.708	17.495
Total	701.476	2.932.978

The amounts entered in the position of income from rents refer especially to the rents coming from the lease of existing spaces at the Agigea branch. During the analyzed period, these revenues are at a lower level than the one achieved in the corresponding period of the previous year, 3 of the 5 barns in the branch records not being rented in the 9 months of 2021, these revenues being influenced by the effects of the COVID-19 pandemic. In September, for two salandas, rental solutions were found for internal partners.

7. Outgoings on stocks
	30.09.2021	30.09.2020
Expenses with raw materials	10.688.017	9.330.404
Expenses of consumable materials, from whom:	6.081.631	7.105.354
Expenses of auxiliar materials	5.304.428	6.232.187
Expenses of fuel	393.728	369.394
Expenses with spare parts	249.530	332.662
Expenses of other consumable materials	133.945	171.111
Expenses regarding materials of nature	347.230	388.856
inventory items
Expenses of unstocked materials	130.235	181.701
Expenses regarding goods	16.428	15.333
Received discount	(180)	(204)
Total	17.263.361	17.021.444

In the 9 months of 2021 the significant share in the total expenses with the stocks is held by the raw materials (naval board) and the auxiliary materials (profiles, pipes). In total, there is an increase in expenses by 1.42% compared to the previous year, this increase being due to the increase in raw material prices but also to the fact that revenues from the sale of ships also increased by 2.79%.

Expenditures representing stock consumption that, according to the provisions of IFRS, are included in the value of some assets are recognized during the period depending on their nature. Accordingly, the accounting records the value of current assets in the income statement. We specify that the Company, according to IAS 1, has chosen to present the analysis of expenses using a classification based on their nature, and therefore does not present either the value of these expenses or the value of the corresponding income.

8. Utilities outgoings
	30.09.2021	30.09.2020
Expenses with energy	1.100.519	992.364

Total	1.134.903	1.019.631
Expenses with water	34.384	27.267

In the period 01.01-30.09.2021, the expenses with utilities experienced an increase compared to last year (by 10.90%), this in the conditions in which the realized production (revenues) increased, but also the supply tariffs experienced a slight increase . We point out that an influencing factor in this increase is also the method of presenting expenses using a classification based on their nature, according to IAS 1.

IAS 1.104 9. Staff costs

	30.09.2021	30.09.2020
Personnel expenses Expenses with contributions to compulsory social insurance	18.673.578 1.729.114	19.140.066 1.273.222
Total	20.402.692	20.413.288
Medium number of employees	354	373

In the period analyzed from 2021, the salary expenses remained at a level close to the one achieved in the corresponding period of 2020, given that the salaries of the Company's staff, starting with October 2020, were increased by the gross amount of 250 lei / employee - CA decision no. 9 / 02.10.2020 and the production realized and delivered experienced a slight increase. In the same context, we find a reduction in the average number of staff by 5.09% compared to the similar period in 2020. As in the case of other categories of expenditure, and in the presentation of staff expenditure, a factor influencing this increase is the method of presenting expenditure using a classification based on its nature.

10. Value adjustement of current asset	30.09.2021	30.09.2020
Losses(Profit) on receivables and various debtors	(2.331.559)	(2.905.997)
Total	(2.331.559)	(2.905.997)

The amount presented above refers to the adjustment of depreciations related to inventories and other receivables made during the analyzed period, following the capitalization by sale and of the second coastal, respectively the amounts for which, in previous years, were established depreciation.

IAS 1.97 11. Other outgoings

	30.09.2021	30.09.2020
Expenses with maintenance and repairs	364.816	88.740
Expenses with royalties, managed locations and	1.313.281	636.371
rents
Expenses with premium insurance	114.220	103.698
Expenses with commisions and fees	13.351	20.020
Protocol, advertising and advertising expenses	22.695	24.787
Goods and personel transport expenses	3.558.939	1.936.834
Travel expenses, secondments and transfers	19.557	12.965
Postage and telecommunications expenses	41.135	35.031
Banking services expenses	38.407	39.535
Other expenses for services performed by third	5.778.942	5.427.513
parties
Expenses with other taxes and fees	287.301	308.215
Expenses for environment protection	5.261	3.879
Expenses with fixed assets held for sale	-	249.305
Other operational expenses	296.511	313.157
Total outgoings	11.854.416	9.200.050

In the period 01.01-30.09.2021 the level of expenses above increased by 28.85% compared to the similar period of the previous year, and in the case of these categories of expenses, a factor of influence in these increases is the method of presenting expenses using a classification based on their nature.

We will explain below some of the positions that have a significant share in total expenses:

• There is a significant increase in maintenance and repair costs, the Company paying special attention to the repair of transport and lifting equipment. During the analyzed period, significant expenses were made with the repair of the salandas in the patrimony of the Agigea branch, following the conclusion of new rental contracts (for 2 salandas), respectively for the preparation for rent (2 more salandas).
• The expenses with royalties, management locations and rents register a significant increase especially as a result of the costs of this nature accumulated during the execution / stationary period of the second coastal one, until its capitalization;
• Expenses with the transport of goods and persons, expenses that are closely related to the volume of sales revenues. These refer in particular to the transport of the 4 river vessels built at the main headquarters (3 ships in the similar period from 2020), on the route: Orşova - Rotterdam, or other delivery points in the Netherlands, indicated in the commercial contracts. We specify that, in accordance with the contractual provisions, the transfer of ownership is carried out together with the handing over of the ships at these points, during the whole transport period the ships are insured by the care of the Company, according to the contractual clauses. A significant influence in their increase

IAS 1.97 11. Other outgoings (continue)

was represented, as in the case of the Celts with royalties, management locations and rents, expenses of this nature accumulated by the second coastal;

• The volume of services performed by third parties increased compared to the similar period of 2020, but the Company used less subcontractors or the outsourcing of naval painting works. With regard to auditors' fees, included in the total amount of this position, it is found that their level is close to that of the previous year. Specifically, during the analyzed period, they registered the following values: 48,358 lei, including VAT. fees to statutory auditors (47,747 lei, including VAT, in the corresponding period of the year previously), and for the internal audit services the amounts paid in the period 01.01-30.09.2021 were 21,081, including VAT (20,747 lei, including VAT, in the corresponding period of the previous year).
• With regard to the position on other operating expenses, they refer mainly to the expenses occasioned by the litigation with VEKA, stating that for the receivables generated by this litigation there were impairments in previous years, so that there were no significant influences. in the statement of profit or loss and other comprehensive income.

IAS 1.86 12. Financial income and expenses

Recognized in the profit or loss account:

		30.09.2021	30.09.2020
IFRS 7.20 (b)	Interest income from bank deposits	17.431	50.344
IAS 21.52 (a)	Incomes from exchange rates differences	831.708	569.144
	Total financial incomes	849.139	619.488
IAS 7.20 (b)	Interests expenses	-	-
IAS 21.52 (a)	Expenses from exchange diferences rates	222.295	156.029
	Total financial expenses	222.295	156.029
	Net financial result	626.844	463.459

In connection with the above amounts, the following details are given:

• interest income is related to bank deposits and current account availability;

• due to the evolution of the exchange rate, but also to the hedging contracts concluded through BRD, the income from the exchange rate differences was higher than the expenses from the exchange rate differences.

• in the analyzed period of 2021, the company did not have bank credits, so it did not register interest with this title.

	a) Expenditure on current profit tax	30.09.2021	30.09.2020
IAS 12.80 (a)	Current period	435.859	440.037
IAS 12.80 (b)	Adjustments of previous periods
	b) Deferred income tax expense
IAS 12.80 (c)	Initial recognition and reversal of temporary differences	734.245	95.881
IAS 12.80 (g)	Changes in previously unrecognized temporary differences
IAS 12.80 (f)	Recognition of previously unrecognized tax los
	Total profit tax expenses ( a+b)	1.170.104	535.918
IAS 12.81 (c)	Reconciliation of effective tax rate
	Profit of the period	38.281	3.775.061
	Non-deductible expenses	297.052	276.236
	Non-taxable incomes	2.748.714	3.521.081
	Elements similar to incomes ( amortisation after	640.064	1.107.461
	reevaluation 2003)
	Other taxable amounts(tax recognized profit)	4.497.433	1.680.115
	Deduction of legal reserve	-	184.249
	Taxable profit	2.724.116	3.133.543
	Expense with the current profit tax	435.859	501.367
	Sponsorship	-	12.437
	Bonus OUG 33/2020	-	48.893
	Profit after taxation	(397.578)	3.335.024

Although in the analyzed period the company registered an insignificant taxable profit (38,281 lei), the current profit tax expense is 435,859 lei, following the taxation of the amounts distributed as dividends from the carried forward result representing the surplus realized from revaluation reserves. Regarding the deferred tax expense, the increase compared to the previous year is due to the temporary differences between the fiscal base and the accounting one generated by the recognition of revenues related to shipbuilding deliveries.

13b. Specific tax expenses

Starting with the year 2017, with the entry into force of Law no.170 / 2016 regarding the specific tax for certain activities, the company owes this type of tax for the activity of the canteen that operates under its subordination. We mention that in the Company's premises a working canteen operates, its activity being codified CAEN 5629 "Other food services n.c.a." and registered in the constitutive act of the company as a secondary activity.

For the year 2021, expenses with specific due tax for this activity is in amount of 13.672 lei.

Şantierul Naval Orşova S.A. Quarterly report for the period ended at 30.09.2021

Reference NOTES TO INDIVIDUAL FINANCIAL SITUATIONS IN ACCORDANCE WITH IFRS

IAS 16 14. Tangible non-current asset

		Land and buildings	Machines and equipments	Furniture and fixtures	Work in progress	Total
	Costs or assumed costs
IAS 16.73 (d)	Balance at 1 January 2021	21.336.506	55.393.007	469.450	2.788.492	79.987.455
IAS 16.73 (e)(i)	Acquisitions	290.539	2.343.250	33.915	2.552.725	5.220.429
IAS 16.73 (e)(ii)	Outgoings of non current asset	18.662	126.630	-	1.898.534	2.043.826
IAS 16.73 (d)	Balance at September 30, 2021	21.608.383	57.609.627	503.365	3.442.683	83.164.058
	Depreciation and losses from depreciation
IAS 16.73 (d)	Balance at 1 January 2021	3.135.237	39.019.092	415.812	-	42.570.141
IAS 16.73 (d)(vii)	Depreciation during the year	1.143.331	1.485.229	22.806	-	2.651.366
IAS 16.73 (d)(ii)	Outgoings of non current asset	17.107	103.781	-	-	120.888
IAS 16.73 (d)	Balance at September 30, 2021	4.261.461	40.400.540	438.618	-	45.100.619
IAS 1.78 (a)	Accounting values
	Balance at 1 January 2021	18.201.269	16.373.915	53.638	2.788.492	37.417.314
	Balance at September 30, 2021	17.346.922	17.209.087	64.747	3.442.683	38.063.439

IAS 16 14. Tangible non-current asset (continued)

On 30 September 2021, land has a book value of 1,201,941 RON and represents an area of 86,000 square meters, of which:

• 85,790 square meters at its headquarters in Orşova and
• 210 square meters at its Branch in Agigea, Constanta County.

In the course of the year 2017 the company has put up for sale by tender two plots of land in the area Gratca, of 937 square meters and 3,988 square meters, in accordance with the management decision of 16 February 2017. Although these lands have not found yet their buyers, they have been classified in an appropriate manner as non-current assets held for sale (account 311).

The company has completed cadastral situation for the entire area of the premises owned by Orşova headquarters. The company has completed the land register for the whole situation in the area of property at its headquarters in Orşova.

Revaluation of tangible non-current assets

On 31 December 2004, the value of tangible non –current assets is presented at historical cost, indexed in accordance with government decisions ("GD"), which were applied by that date or at historical cost.

At 31 December 2005 the Company proceeded to revise the value of tangible assets by using the opinion of specialists, employed by the Company. At 31 December 2006, the Company proceeded to review the value of buildings and special constructions using the opinion of specialists, employed in the Company. On 31 December 2007, the Company has not proceeded to review the value of assets at the Orşova headquarters, instead, Agigea Branch conducted a revaluation of fixed assets of structures and ships group, before the merger, under the old name: SC Servicii Construcţii Maritime S.A. Agigea.

During 2007, 2008 and 2009 there were entries recorded in the technological equipment category and other intangible category which leads to a presentation in the financial statements, of the assets of these groups, both at historical cost indexed in accordance with government decisions (" GD "), and historical cost.

At 31 December 2009, the Company proceeded to the revaluation of buildings and special constructions, both at the headquarters in the town of Orşova and at Agigea branch, using the opinion of independent external evaluators. The reflection method of the revaluation in the company's bookings was to eliminate the depreciation from the book value of assets. The amount of the revaluation surplus was credited to revaluation reserve balance for those targets whose fair value was higher than the net book value, and for the other purposes for which the fair value has been less than the book value a reduction of the existing revaluation surplus was reflected affecting operating expenses for the purposes for which revaluation reserves were not previously recognized or the recognized revaluation reserve was insufficient to cover the decrease.

IAS 16 14. Tangible Non-current Assets (continued)

At 31 December 2010 and 2012, the company did not revalued non-current assets.

At 31 December 2012, the company revalued buildings and means of naval transport, both at headquarters in the town of Orşova and Agigea branch using the opinion of an independent external value. The Company has used the net value model. The amount of the revaluation surplus was credited to revaluation reserves for those assets which fair value was higher than the net book value, and for the other assets which fair value has been lower than the book value a reduction of the existing revaluation surplus, was reflected affecting operating expenses for the purposes for which revaluation reserves were not previously recognized or the recognized revaluation reserve was insufficient to cover the decrease. For the fixed assets that are under conservation at Agigea branch, an impairment of 6,739 RON was recognized.

At 31 December 2013, the company proceeded to the revaluation of means of naval transport, both at headquarters in the town of Orșova and Agigea branch using the opinion of some independent external evaluators. The reflection method of the revaluation in the company's bookings was to eliminate the depreciation from the book value of assets. The amount of the revaluation surplus was credited to revaluation reserve balance for those targets whose fair value was higher than the net book value, and for the other purposes for which the fair value has been less than the book value a reduction of the existing revaluation surplus was reflected affecting operating expenses for the purposes for which revaluation reserves were not previously recognized or the recognized revaluation reserve was insufficient to cover the decrease.

For the fixed assets that are under conservation at Agigea branch, an impairment of 155,474 RON was recognized, at the end of 2013; at 31.12.2012 the impairment was 6,739 RON.

At 31 December 2014, the company proceeded to the revaluation of means of naval transport using the opinion of some independent external evaluators, applying the same rules and methods regarding the registration of the resulting differences.

For the fixed assets that are under conservation at Agigea branch, an impairment of 195,218 RON was recognized, at the end of 2014; at 31.12.2013 the impairment was 155,474 RON.

At 31 December 2015, the company proceeded to the revaluation of means of naval transport, both at headquarters in the town of Orșova and Agigea branch using the opinion of some independent external evaluators. The reflection method of the revaluation in the company's bookings was to eliminate the depreciation from the book value of assets. The amount of the revaluation surplus was credited to revaluation reserve balance for those targets whose fair value was higher than the net book value, and for the other purposes for which the fair value has been less than the book value a reduction of the existing revaluation surplus was reflected affecting operating expenses for the purposes for which revaluation reserves were not previously recognized or the recognized revaluation reserve was insufficient to cover the decrease.

IAS 16 14. Tangible Non-current Assets (continued)

For constructions and ships, an increase amounted at 2,181,569 RON was recorded. However analyzed individually, there are positions that present decreases, their total value is amounted at 3,591,056 RON, out of which 3,416,821 RON were incurred from revaluation surplus previously recorded for these items and 174,235 RON were supported on costs.

Please note that further information regarding the revaluation can be found in the Administrators' report prepared and presented separately in the general meeting of shareholders.

Valuation techniques used by the evaluator for fixed assets under IFRS 13.91, were as follows:

• The cost approach for naval means of transport and for fixed assets in conservation

• The income approach for leased buildings (investment properties).

On December 31, 2019, the company proceeded to the revaluation of fixed assets amounted to the nature of shipping assets, using the same external independent evaluator's opinion and based on the same rules on recording differences in results. In the ordinary general meeting of shareholders, the results of this reassessment will be presented as visually distinct agenda. For fixed assets placed in conservation at Agigea branch was recognized an impairment at the end of the year 2016 total of 287,458.76 RON (to 31.12.2015 this impairment was of 252,756.17 RON).

On December 31, 2017, the company proceeded to the revaluation of fixed assets amounted to the nature of shipping assets, using the same external independent evaluator's opinion and based on the same rules on recording differences in results. In the ordinary general meeting of shareholders, the results of this reassessment will be presented as visually distinct agenda.

For fixed assets placed in conservation at Agigea branch was recognized an impairment at the end of the year 2017 total of 304,490.18 RON (to 31.12.2016 this impairment was of 287,458.76 RON)

On December 31, 2018, the company proceeded to re-evaluate the property, buildings and ships, both at the headquarters of Orşova and at Agigea branch using the opinion of independent external evaluators. The method of reflecting revaluation in the Company's accounts was that of eliminating depreciation from the carrying amount of assets. With the value of the revaluation surplus, the balance of revaluation reserves was credited for those items whose fair value was higher than net book value, and for the other objectives for which the fair value was less than the net book value reflected the decrease of the existing revaluation surplus and / or the impairment of operating expenses in the case of previously unrecognized

IAS 16 14. Tangible Non-current Assets (continued)

revaluation reserves or recognized revaluation reserves was insufficient to cover the decrease. In both the construction group and the ship, by total group, there are increases, totaling 5,330,995 RON. However, individually analyzed were positions where there were decreases, their total value being 1,054,765 RON, out of which: 1,047,790 RON were borne from the revaluation surplus previously recorded in these positions and the amount of 6,975 was incurred on costs.

At December 31, 2019, the Company proceeded to reevaluation the tangible assets of the nature of the means of ship transport, using the opinion of the same independent external evaluator and based on the same rules regarding the recording of the resulting differences. In the ordinary general meeting of the shareholders, the results of this reassessment will be presented as a separate item on the agenda.

In order to carry out these operations, the company turned to the specialized services of the evaluator DARIAN DRS S.A., headquarters in Timisoara.

Valuation techniques used by the evaluator for fixed assets under IFRS 13.91, were as follows:

• The cost approach for naval means of transport and for fixed assets in conservation
• The income approach for leased buildings (investment properties).

According to IFRS 13, valuation at fair value of buildings and means of naval shipping supposed taking into consideration the characteristics of the assets, which users of financial statements would consider in determining the price of the asset at the balance sheet date. Fair value determination was carried out by an independent external evaluator and shall be treated as level 2 under IFRS 13 for the data taken into account in determining the fair values as at 31 December 2019, the date of financial reporting. At the company level, there has not been any change of the level presented by IFRS 13 for the data taken into account in determining the fair values. Also, the maximum amount for assets valued at fair value does not differ from the current amount of use.

Impairment losses and subsequent reversals

At the end of the year 2020 for fixed assets in conservation at Agigea Branch, was done also depreciation test, being recognized a total depreciation of 406.522 lei, related to fixed assets other than buildings. This depreciation is found at the same level and on 30.09.2021.

IAS 16 14. Tangible Non-current Assets (continued)

Pledged or mortgaged non-tangible asset

To guarantee the multi-option and multi-currency global limit, in value of 2,000,000 ( as to same level like 2019), made available by BRD-GSG SA, the Company established the following::

• First rank mortgage on the following properties: Repair hall, New Hall, Thermal power station, Compressors Station and PSI Shed, Operating Group, Cafeteria, Merged building, all including land, toate împreună cu terenul aferent, properties assessed according to the Guarantee Monitoring Report at EUR 1,512,800 market value, registered in the Land Book Register under the numbers 1133, 1146, 1121, 1145, 1134, 1135 and 1132;
• Security interest with dispossession on a deposit in value of 401.201 EUR.
• Assignment of receivables as collateral on receipts in a total value of 9.471.000 EUR, resulting from the commercial contracts concluded by the Company with third parties, not cashed up at 30.09.2021.

Non-tangible asset under construction

On 30.09.2021 the company has unfinished investment objectives in the amount ( mainly slipway modernization at Branch Agigea) of 3.442.683 lei (4.374.107 lei on 30.09.2020). A significant share in them is the works to modernize the launch path from the Agigea branch, including the replacement of the strollers.

Şantierul Naval Orşova S.A. Quarterly report for the period ended at 30.09.2021

Reference NOTES TO INDIVIDUAL FINANCIAL SITUATIONS IN ACCORDANCE WITH IFRS

IAS 38 15. Intangible assets

IFRS 3.61 IAS 38.118 (c),		Other assets	Total
(e)	Cost
IFRS 3.B67 (d)(viii),IAS 38.118	Balance at 1 January 2021	1.077.700	1.077.700
IAS 38.118(e)	Acquisitions	202	202
	Outgoings of intangible assets	-	-
IAS 38.118	Balance at 30 of September 2021	1.077.902	1.077.902
	Depreciation and amortisation losses
IFRS 3.B67 (d)(i),IAS	Balance at 1 January 2021	1.071.508	1.071.508
38.118
IAS 38.118(e)(vi)	Amortisation during the year	2.402	2.402
	Outgoings of fixed assests	-	-
IFRS 3.B67 (d)(viii),IAS 38.118	Balance at 30 of September 2021	1.073.910	1.073.910
	Accounting values
IAS 38.118(c) IAS 38.118(c)	Balance at 1 January 2021 Balance at 30 of September 2021	6.192 3.992	6.192 3.992

IAS 39 16. Other investments, including derivative financial instruments

The securities are recognized in the financial statements in accordance with IAS 27 (revised in 2010), IAS 36 (revised in 2009), IAS 39 (revised in 2009) and IFRS 7 (issued in 2008). From the corroboration of the provisions of the 4 standards, the company adopted the following policy for the recognition and evaluation of the shares and the securities:

• investments in subsidiaries, jointly controlled entities and associated entities are recognized at cost value;

• short-term investments held for sale not quoted on the stock exchange are recorded at cost, for the impairments being made adjustments (the treatment for the depreciation of these securities is established by IAS 39 paragraph 63);

• Short-term investments held for sale listed on the stock exchange are recorded at fair value (the value of the last trading day of the year), any gains or losses to be recognized in the capital situation. If there is objective evidence of impairment (as presented in paragraph 59 of IAS 39), as well as in the case of foreign exchange losses and gains, the loss of value will be recognized in the profit and loss account.

	30.09.2021		30.09.2020
Other investments	Accounting value	Imparment adjustements	Net value	Accounting value	Imparment adjustements	Net value
Long term investments
Shares detained at Kritom	684.495	684.495	0	684.495	684.495	0
Other titles detained on long term	0	0	0	0	0	0
Total investments on long term	684.495	684.495	0	684.495	684.495	0

IAS 39 16. Other investments, including derivative financial instruments (continued)

In 1993, Maritime Construction Services S.A. ("SCM"), the company absorbed by Șantierulul Naval Orşova S.A. During the financial year ended 31 December 2008, it set up a joint venture with Crete, based in Crete, based in Iraclio, based in Crete. The share held by SCM in the capital of Kritom Shipping Company was 49%, respectively:

• the total share capital of this company was 1,230,600 euros, consisting of a total number of 4,200 shares of 293 euros / share,

• SCM, at that time held 2,058 shares, respectively 602,994 euros (49%), and Domiki Kritis held 2,142 shares worth 627,606 euros (51%) According to the latest information received from the Greek authorities, the Greek partner proceeded, without our consent, by virtue of the provisions of art.3.4 of the Convention establishing the company, to double the share capital of Kritom, reaching 2,461,200 euros (8,400 shares ), from which:

• The joint-stock company "Domiki Kritis", which has since become Aristodimos E. Lidakis SA, holds 1,857,620 euros, the equivalent of 6,340 shares, representing 75.48%, and

• Orșova Shipyard holds 2,060 shares worth 603,580 euros, respectively 24.52% of the share capital.

The Convention for the Establishment of the Kritom Shipping Company provides that the duration of the company is for the period 1993-2012. However, in 2012, the Greek shareholder, without consulting the Orsova Shipyard, and using the dominant position in the general meeting decided to extend the duration of the company by 25 years, until 2037. At the moment, based on the information we have, the company is active but due to the lack of contracts, as a result of the pandemic and the look down situation in which Greece is, it does not generate revenue.

In order to obtain more information about the current situation of Kritom and to clarify all aspects of administration, Orșova Shipyard contacted a law firm that will represent us in court and support our interests as a shareholder.

According to IFRS 13, the fair value measurement of short-term financial investment assets required the consideration of their characteristics that market participants would take into account in determining the price of the asset at the measurement date. existing information on the interbank market and is assimilated to the level 1 required by IFRS 13 for the data taken into account when determining fair values at December 31, the date of the financial reporting.

As of September 30, 2021, the Company had made adjustments for the total depreciation of these securities, ie at the level of 684,495 lei, so that the net value on September 30, 2021 was 0 lei (on September 30, 2020 the same situation was recorded). The factors that contributed to these depreciations are the mistrust and lack of transparency shown by the Greek partner, which manages the company, as we have shown.

This financial asset is part of the category of financial assets measured at amortized cost according to IFRS 7.8.

17. Stock

		30.09.2021	30.09.2020
IAS 1.78 (c),2.36(b)	Raw materials and materials	9.950.636	7.726.793
IAS 1.78(c), 2.36(b)	Production in progress	19.276.532	28.062.015
IAS 1.78(c), 2.36(b)	Fixed assets detained for sale	18.637	68.853
IAS 1.78(c), 2.36(b)	Finished products	-	-
IAS 1.78(c), 2.36(b)	Products kept by third parties	-	8.221.563
IAS 1.78(c), 2.36(b)	Goods	-	-
	Imparment adjustments	(783.275)	(4.122.781)
	Stocks at net value	28.462.530	39.956.446

IAS 1.104,

2.36(e)(f) For inventories of raw materials and materials older than 2 years (for inventories of sheet metal older than 3 years), existing in the balance at the end of 2020, without movement, the company proceeded to adjust the carrying amount, constituting a total depreciation of 783,340 lei, which is maintained at a close value, respectively 783,275 lei, and on 30.09.2021. Compared to the corresponding period of the previous year, there is a significant decrease due to the resumption of income of the depreciation constituted in the previous years for the production in progress related to the two coastal ones. On 30.09.2021, the company had registered fixed assets held for sale in the amount of 18,637 lei, representing 2 lands in patrimony at the main headquarters in Orsova. The valuation reports have been prepared for these fixed assets, and the sale procedure is established.

18. Trade and similar receivables, other receivables and advances

		30.09.2021	30.09.2020
IAS 1.78 (b)	Trade receivables in relation to related parties	-	-
	Loans to executives	-	-
IAS 1.78 (b)	Trade receivables	5.975.985	19.212.720
	Adjustments for the impairment of trade receivables	(166.620)	(166.620)
IFRS 7.8(c)	Net commercial loans and receivables	5.809.365	19.046.100
	Claims - total	2.087.471	1.088.212
	Different debitors	324.022	529.304
	Suppliers - debtors	155.235	837
	VAT to be recovered and not exigible	888.745	596.777
	Adjustment for other receivables	(304.633)	(461.825)
	Expenses registered in advance	190.975	261.246
	Other receivables	833.127	161.873
	Total	7.896.836	20.134.312

18. Trade and similar receivables, other receivables and advances (continued)

Regarding the trade receivables, on 30.09.2021 they are at a lower level than those registered at the end of the corresponding period of the previous year, there were no movements of the Company's impairment accounts related to the adjustments of trade receivables. However, there is a decrease in impairment accounts for Other receivables, especially due to the resumption of income from impairments for expenses with arbitrators / lawyers involved in the dispute with Veka. Regarding the "Other receivables" position, the increase is mainly due to the amounts paid by the company to the state budget representing current obligations, the settlement of which was not operated by the fiscal body until the end of September. The receivables analyzed in this note do not include receivables presented in the category of fixed assets.

The movements of the Company's depreciation accounts, related to the adjustments of the trade receivables are the following:

	30.09.2021	30.09.2020
At 1st January	166.620	166.620
Impairment recovery	-	-
Constituted depreciation	-	-
Balance at the end of period	166.620	166.620

19. Trade payables and other liabilities

	30.09.2021	30.09.2020
Trade payables - short term	1.425.998	2.253.773
Social security and other taxes	2.022.871	1.036.434
Suppliers - invoices to be received	20.497	165.308
Customer creditors	9.619.603	1.714.144
Other creditors	1.174.413	912.876
Trade payables - long term	-	-
Total	14.263.382	6.082.535

19. Trade payables and other liabilities (continued)

Short-term trade payables relate to payment obligations to suppliers and advances received from customers. There is a decrease compared to the similar period of the previous year in terms of trade payables, but an increase in obligations on social insurance and other taxes and fees due to the state budget, their balance on 30.09.2021 representing current debts whose payment , by compensation or payment was made in October 2021. Also a significant increase is registered at the position "Customers-creditors", the company collecting advances from customers in accordance with the contractual provisions.

20. Cash and cash equivalents

	30.09.2021	30.09.2020
Bank accounts in lei	1.724.822	1.951.668
Bank accounts in foreign currency	24.802.374	12.570.796
Petty cash in lei	8.414	13.213
Petty cash in foreign currency	-	-
Other values	7.473	139
Total	26.543.083	14.535.816

Cash and cash equivalents increased significantly compared to the previous period (by 82.6%), mainly due to the collection, in proportion of 80%, of the coastal companies that were the subject of the dispute with VEKA. We specify that at the end of September 2020, the first coastal, delivered during the same month, was collected in proportion of 20% and the second coastal was in the category of stocks as production in progress.

21. Capital and reserves

Capital social

IFRS 7.7 IAS 1.79(a)(i),(iii) The structure of shareholders as of September 30, 2021 has not undergone changes compared to the one existing on 18.06.2021, the registration date chosen to identify the shareholders who have the right to collect the dividends related to the financial year 2020, respectively:

	Number	Amount
	Of shares
		(lei)
SIF 3 Transilvania	5.711.432	14.278.580
SIF 5 Oltenia	3.200.337	8.000.843
SIF 4 Muntenia	1.504.600	3.761.500
Other corporate shareholders/individual shareholders	1.006.550	2.516.375
	11.422.919	28.557.298

The subscribed and paid up share capital is amounted to 28,557,298 RON, divided into a number of 11,422,919 nominal and dematerialized shares, each worth 2.50 RON.

The company's shares are dematerialized, ordinary and indivisible.

The identification data for each shareholder, the contribution to the share capital, number of shares owned and the participation of the shareholder in share capital are presented in the shareholder register kept by the company registry contractually designated for this purpose.

Each subscribed and paid share, grants the shareholders, under the law, the right to vote in the General Meeting of Shareholders, to vote or to be elected to the governing bodies, the right to participate in the distribution of profit or any rights derived from the shareholder quality. During period 01.01-30.09.2021 there were no changes in share capital.

22.Employees benefits

a) Remuneration of directors and administrators

In order to exercise the management activity, the Company is obliged to pay to the directors or fixed monthly remuneration, the stability by the constitutive act or the decision of the general meeting of shareholders, as the case may be, and a variable remuneration in the report on the achievement of objectives and performance indicators. . administration. The fixed monthly remuneration of the administrators for the period January 1-September 30, 2021 was in the amount of 440,802 lei, and for the corresponding period of the previous year it was in the amount of 660,231 lei.. For 2020, the variable remuneration for directors and general manager was not approved, which determined in the analyzed period a lower level of salary expenses compared to the corresponding period of the previous year. We specify in this sense that the variable remuneration due to the directors and the general manager for 2019, paid in the first half of 2020, approved in the Ordinary General Meeting of Shareholders of April 10, 2020 (OGMS Decision no. 49 / 10.04.2020) was in the amount of 198,766 lei for administrators and 39,753 lei for the general manager. The company did not grant advances or loans to directors or administrators in the 9 months of 2021.

Wage expenses:

	Financial exercise	Financial exercises
	End at	End at
	30 September 2021	30 September 2020
	(lei)	(lei)
Administrators	440.802	858.997
Directors	975.154	845.757
	1.415.956	1.704.754

During 01.01-30.09.2021 there were no changes in the composition of the Board of Directors, this being the same as on 31.12.2020, respectively:

• Mr. Andanut Crinel-Valer President
• Mr. Moldovan Marius-Adrian member
• Mr. Dumitrescu Lucia-Carmen member
• Mr. Mihai Constantin-Marian member
• Mr. Ciurezu Tudor member

22.Employees benefits (continued)

The indemnities and other rights granted to the administrators are provided in art. 19 of the Articles of Association and in the management contracts, which were approved at the General Meeting of Shareholders on October 2, 2020. The allowances for 2021 were established and approved by the OGMS on April 16, 2121. The salary and other rights due to the general manager were established by the Board of Directors, within the limits provided in art. 22 of the Articles of Incorporation and, respectively, of the Mandate Agreement concluded between the Board of Directors and the General Manager. The mandate of the current Board of Directors ends on October 2, 2022 and that of the General Manager ends on November 9, 2022.

Salaries payable at the end of the period:

	30 September 2021	30 September 2020
	(lei)	(lei)
Administrators	28.653	42.918
Directors	34.342	21.485
	62.995	64.403

b) Employees

The average number of employees during the year was as follows:

	Financial exercise Ended at	Financial exercises Ended at
	30 September 2021	30 September 2020
Administrative staff	44	50
Direct productive staff	244	264
Indirect productive staff	66	59
	354	373

23. Other information, implications of the COVID-19 pandemic on the quarterly report

In the current context generated by the COVID 19 pandemic based on the information available to it, the company considers that there are no significant uncertainties, according to point 25 of IAS 1, for the continuation of the activity and there are no indications leading to an impairment of assets held, according to with IAS 36.

Throughout the period, from the decree of the state of emergency (March 2020) until now, the company has continued its activity, stating that at the Agigea branch due to this pandemic could not be found solutions for renting barges - the main source of income of this subunit, as we have already shown, fact for which the operating result at this branch was negative and influenced, in part, the result on total activity. However, even in these conditions, the impact that the COVID-19 pandemic had on the company's activity during the reported period was not likely to significantly influence financial performance. The company has sufficient own financial resources to ensure financial stability, there is no liquidity risk or major negative influences on cash flows.

The company's management has as permanent objectives the analysis of the future impact of the pandemic on the financial performance and the taking of adequate measures to reduce the afferent risks.

Administrator Dr. Eng. Crinel-Valer Andanut

Issued Ec. Marilena Visescu