Vassilico Cement Works Public Company LTD

Quarterly Report • Jul 31, 2020

Report and Consolidated Interim Financial Statements Six months ended 30 June 2020

Report and Consolidated Interim Financial Statements Six months ended 30 June 2020

Contents	Page
Report for the Six Months Ended 30 June 2020	1
Consolidated Statement of Profit or Loss and Other Comprehensive Income	2
Consolidated Statement of Financial Position	3
Consolidated Statement of Changes in Equity	4
Consolidated Statement of Cash Flows	5
Notes to the Consolidated Interim Financial Statements	6
Statement of the members of the Board of Directors and other responsible persons of the Company for the interim financial statements	7

Report for the Six Months Ended 30 June 2020

On July 30th 2020, the Board of Directors of Vassiliko Cement Works Public Company Ltd approved the financial results of the Group for the first half of the year that ended 30 June 2020.

Financial results

The restrictive measures taken by the authorities due to the COVID-19 pandemic had a significant impact on the operations of the Company and the financial results of the first half of the year. As a result, revenues for the first half of 2020 decreased to €44.512.000 compared to €53.996.000 for the corresponding period of 2019, which in turn had an impact on the overall profitability. The profit for the first six months of 2020 was €4.858.000 versus €10.411.000 for the fist half of 2019.

The management of the Company has implemented a crisis management plan and is taking additional measures to improve the operational cost structure and liquidity in response to the uncertainty of the market conditions as a result of the COVID-19 pandemic.

Transactions with related parties

The transactions with related parties for the first half of 2020 are presented on note 4 of the consolidated interim financial statements.

Μain risks and uncertainties

The main risks and uncertainties faced by the Group are presented on note 5 of the consolidated interim financial statements.

Prospects for the year

The construction industry resumed operations in May, following a lockdown of 40 days. Some important sectors of the economy are still suffering from the consequences of the restrictive measures and it is not clear yet as to the negative impact that these may have on the domestic or the world economy or on the demand in the construction industry in the months to come.

Consolidated Statement of Profit or Loss and Other Comprehensive Income Six months ended 30 June 2020

	Six months ended 30 June
	2020 €000	2019 €000
Revenue	44.512	53.996
Cost of sales	(34.460)	(38.742)
Gross profit	10.052	15.254
Other operating income	827	596
Distribution expenses	(2.122)	(2.324)
Administrative expenses	(2.053)	(1.860)
Other operating expenses	(1.220)	(751)
Operating profit before financing costs	5.484	10.915
Financial income	9	21
Financial expenses	(108)	(152)
Net financial expenses	(99)	(131)
Profit from investing activities	5	-
Gain on disposal of equity-accounted investees	-	787
Share of profit from equity-accounted investees	283	285
Profit before tax	5.673	11.856
Taxation expense	(815)	(1.445)
Profit for the financial period	4.858	10.411
Other comprehensive (loss)/income
Revaluation (loss) / gain on financial assets at fair
value through οther comprehensive income	(53)	9
Other comprehensive (loss)/income for the
period	(53)	9
Total comprehensive income for the period	4.805	10.420
Profit attributable to:
Equity holders of the parent	4.858	10.411
Non-controlling interest	-	-
	4.858	10.411
Total comprehensive income attributable to:
Equity holders of the parent	4.805	10.420
Non-controlling interest	- 4.805	- 10.420
Basic and diluted earnings per share (cents)	6,8	14,5

Consolidated Statement of Financial Position

30 June 2020

	30 June 2020	31 December 2019
	€000	€000
ASSETS
Property, plant and equipment	227.078	229.127
Intangible assets	12.416	12.416
Investment property	5.749	6.030
Investments in equity-accounted investees	1.449	1.202
Financial assets at fair value throught other comprehensive income	204	258
Total non-current assets	246.896	249.033
Inventories	28.714	30.929
Trade and other receivables	7.132	7.023
Cash and cash equivalents	10.888	4.006
Total current assets	46.734	41.958
Total assets	293.630	290.991
EQUITY AND LIABILITIES
Equity and reserves
Share capital	30.932	30.932
Reserves Total equity attributable to equity holders of the parent	214.661 245.593	209.856 240.788
Non-controlling interest	-	-
Total equity	245.593	240.788
LIABILITIES
Interest bearing-loan and borrowings	7.894	8.970
Deferred tax liabilities	24.409	24.009
Provisions	300	300
Total non-current liabilities	32.603	33.279
Interest bearing-loan and borrowings	8.834	8.371
Trade and other payables	6.600	8.553
Total current liabilities	15.434	16.924
Total liabilities	48.037	50.203
Total equity and liabilities	293.630	290.991

Consolidated Statement of Changes in Equity Six months ended 30 June 2020

		Share				Equity attributable to
	Share Capital €000		premium reserve	Revaluation reserve	Fair value reserve	Retained profits	holders of parent	Non-controlling interest	Total equity
		€000	€000	€000	€000	€000	€000	€000
Six months ended 30 June 2020
Balance 1 January 2020	30.932	45.388	36.830	(373)	128.011	240.788	-	240.788
Profit for the period	-	-	-	-	4.858	4.858	-	4.858
Other comprehensive loss for the period	-	-	-	(53)	-	(53)	-	(53)
Total comprehensive income for the period	-	-	-	(53)	4.858	4.805	-	4.805
Balance 30 June 2020	30.932	45.388	36.830	(426)	132.869	245.593	-	245.593
Six months ended 30 June 2019
Balance 1 January 2019	30.932	45.388	38.242	-	118.788	233.350	-	233.350
Profit for the period	-	-	-	-	10.411	10.411	-	10.411
Other comprehensive income for the period	-	-	-	9	-	9	-	9
Total comprehensive income for the period	-	-	-	9	10.411	10.420	-	10.420
Balance 30 June 2019	30.932	45.388	38.242	9	129.199	243.770	-	243.770

Consolidated Statement of Cash Flows Six months ended 30 June 2020

	Six months ended 30 June
	2020 €000	2019 €000
Cash flows from operating activities
Profit for the period	4.858	10.411
Adjustments for:
Depreciation and amortisation charges	7.413	7.520
Interest income	(9)	(21)
Dividends income	(5)	-
Interest expense	124	153
Share of profit of equity-accounted investees	(283)	(285)
Gain on disposal of equity-accounted investees	-	(787)
Bad debts recovered	(111)	-
Taxation expense	815	1.445
Operating profit before changes in working capital	12.802	18.436
Changes in:
Trade and other receivables	(109)	(1.080)
Inventories	2.215	1.476
Trade and other payables	(2.344)	617
Cash generated from operations	12.564	19.449
Interest paid	(144)	(173)
Taxes paid	-	-
Net cash inflow from operating activities	12.420	19.276
Cash outflows to investing activities
Proceeds from sale of investment property	421	-
Proceeds from disposal of equity-accounted investees	-	4.150
Interest received	9	21
Dividends received	5	50
Acquisition of property, plant and equipment	(5.360)	(5.979)
Net cash used in investing activities	(4.925)	(1.758)
Cash flows from financing activities
Proceeds from new loans raised	3.340	2.113
Repayment of loans	(3.953)	(3.953)
Net cash outflows to financing activities	(613)	(1.840)
Net increase of cash and cash equivalents	6.882	15.678
Cash and cash equivalents at 1 January	4.006	259
Cash and cash equivalents at 30 June	10.888	15.937

Notes to the Consolidated Interim Financial Statements

• 1. The interim financial statements relate to the period from 1 January to 30 June 2020, are not audited by the Company's auditors and were approved by the Board of Directors on 30 July 2020.
• 2 The interim financial statements comply with the International Accounting Standard 34 "Interim Financial Statements".
• 1. The same accounting policies and methods of computation are followed in the interim financial statements as compared with the most recent annual financial statements. The interim financial statements are expressed in thousands of Euro.

4. Transactions with related companies

The Company entered into various transactions with the Hellenic Mining Group, Heidelberg Cement Group, Cyprus Cement Group, associated and related companies. These transactions include the rendering of technical, administrative, commercial and other services to the Group as well as the purchase and sale of raw materials, spare parts and other goods and services at mutually agreed prices. During the period, the transactions with the above were as follows:

	Sales		Purchases
	2020 €000	2019 €000	2020 €000	2019 €000
Hellenic Mining Group	1	-	69	104
KEO Plc	-	-	3	3
Cyprus Cement Group	-	-	60	60
Enerco - Energy Recovery Ltd	781	605	637	365
	782	605	769	532

5. Μain risks and uncertainties

The uncertain economic conditions, the limited availability of financing for individuals and businesses by the banking system in general, energy prices and exchange rates, could affect:

• (1) the Group's income and operating costs,
• (2) the ability of the Group's trade and other debtors to repay the amounts due to the Group, and

(3) the cash flow forecasts of the Group and the assessment of impairment of other financial and non financial assets.

The uncertainty regarding the course of developments in the markets and the current uncertain situation with the COVID-19 pandemic, does not allow a safe prediction for the remaining of the current year, which may affect negatively the future financial performance, cash flows and financial position of the Group. Considering the above uncertainties the Group's Management is taking measures to limit exposure to certain risks and mitigate any possible negative consequences.

Other risks and uncertainties faced by the Group are detailed in note 35 of the Annual Report and Financial Statements for 2019.