Vassilico Cement Works Public Company LTD

Quarterly Report • Jul 30, 2021

Report and Consolidated Interim Financial Statements Six months ended 30 June 2021

Report and Consolidated Interim Financial Statements Six months ended 30 June 2021

Contents	Page
Report for the Six Months Ended 30 June 2021	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 2021

On July 29th 2021, 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 2021.

Financial results

Revenues for the first half of 2021 reached €50.386.000, compared to €44.512.000 for the respective period of 2020. Revenue increase relates to the return of the construction industry to normal activity levels, following the restrictive measures and the 40 days lockdown imposed by the state due to the COVID-19 pandemic in the first half of the year 2020.

The profit for the period reached €8.783.000 compared to €4.858.000 for the same period of 2020.

The Company is facing substantial cost increases of key factors of production, like electricity and fuels, which follow the international market trends. These increases are compounded by the increased cost of CO² emission rights which affect the cost structure of the Company both directly and indirectly.

The Management is continuing the program of replacement of fossil fuels with alternative sources of fuels mitigating, to some extend, the impact of the recent increases of fossil fuels costs, while at the same time it improves its environmental footprint.

Furthermore, the 8MW photovoltaic park that is in operation since February 2020 has been proven to be beneficial in such times of rising electricity prices. The Management is already planning its further expansion.

Transactions with related parties

The transactions with related parties for the first half of 2021 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

While sales outlook looks stable, energy costs continue to increase. Climate change is one of the main challenges the Company faces. Current environmental regulations and CO² emission rights prices are expected to increase production costs and impact product price levels.

The Company is paying particular attention to these aspects trying to mitigate the possible negative impact on the operations with additional investments to improve our CO2 footprint.

Consolidated Statement of Profit or Loss and Other Comprehensive Income Six months ended 30 June 2021

	Six months ended 30 June
	2021 €000	2020 €000
Revenue	50.386	44.512
Cost of sales	(36.157)	(34.460)
Gross profit	14.229	10.052
Other operating income	547	827
Distribution expenses	(2.107)	(2.122)
Administrative expenses	(1.815)	(2.053)
Other operating expenses	(1.044)	(1.220)
Operating profit before financing costs	9.810	5.484
Financial income	39	25
Financial expenses	(146)	(124)
Net financial expenses	(107)	(99)
Profit from investing activities	-	5
Share of profit from equity-accounted investees	405	283
Profit before tax	10.108	5.673
Taxation expense	(1.325)	(815)
Profit for the financial period	8.783	4.858
Other comprehensive income/(loss)
Revaluation gain / (loss) on financial assets at fair value through
οther comprehensive income	3	(53)
Other comprehensive income/(loss) for the period	3	(53)
Total comprehensive income for the period	8.786	4.805
Profit attributable to:
Equity holders of the parent	8.783	4.858
Non-controlling interest	-	-
	8.783	4.858
Total comprehensive income attributable to:
Equity holders of the parent	8.786	4.805
Non-controlling interest	-	-
	8.786	4.805
Basic and diluted earnings per share (cents)	12,2	6,8

Consolidated Statement of Financial Position

30 June 2021

	30 June 2021 €000	31 December 2020 €000
ASSETS
Property, plant and equipment	223.965	226.107
Intangible assets	12.364	12.363
Investment property	5.583	5.583
Rights of use assets	1.641	1.700
Investment in equity-accounted investee	1.557	1.560
Financial assets at fair value throught other comprehensive income	220	218
Total non-current assets	245.330	247.531
Inventories	28.583	25.712
Trade and other receivables	8.662	7.630
Other current assets	4.916	-
Cash and cash equivalents	1.136	13.782
Total current assets	43.297	47.124
Total assets	288.627	294.655
EQUITY AND LIABILITIES
Equity and reserves
Share capital	30.932	30.932
Reserves	214.129	216.133
Total equity attributable to equity holders of the parent	245.061	247.065
Non-controlling interest	-	-
Total equity	245.061	247.065
LIABILITIES
Interest-bearing loans and borrowings	4.284	4.760
Lease liabilities	1.564	1.605
Deferred taxation	25.820	25.182
Provisions for liabilities and charges	300	300
Total non-current liabilities	31.968	31.847
Interest bearing-loan and borrowings	4.241	8.181
Lease liabilities	128	121
Trade and other payables	7.229	7.441
Total current liabilities	11.598	15.743
Total liabilities	43.566	47.590
Total equity and liabilities	288.627	294.655

Consolidated Statement of Changes in Equity Six months ended 30 June 2021

						Equity
	Share Capital	Share premium reserve	Revaluation reserve	Fair value reserve	Retained profits	attributable to holders of parent	Non-controlling interest	Total equity
	€000	€000	€000	€000	€000	€000	€000	€000
Six months ended 30 June 2021
Balance 1 January 2021	30.932	45.388	35.503	(413)	135.655	247.065	-	247.065
Profit for the period	-	-	-	-	8.783	8.783	-	8.783
Other comprehensive income for the period	-	-	-	3	-	3	-	3
Total comprehensive income for the period	-	-	-	3	8.783	8.786	-	8.786
Dividends	-	-	-	-	(10.790)	(10.790)	-	(10.790)
Balance 30 June 2021	30.932	45.388	35.503	(410)	133.648	245.061	-	245.061
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

Consolidated Statement of Cash Flows

Six months ended 30 June 2021

	Six months ended 30 June
	2021 €000	2020 €000
Cash flows from operating activities
Profit for the period	8.783	4.858
Adjustments for:
Depreciation and amortisation charges	7.049	7.413
Unrealised exchange profit	(39)	-
Interest income	-	(9)
Dividends income	-	(5)
Interest expense	146	124
Share of profit of equity-accounted investees	(405)	(283)
Loss on sale of property, plant and equipment	75	-
Bad debts recovered	-	(111)
Taxation expense	1.325	815
Operating profit before changes in working capital	16.934	12.802
Changes in:
Trade and other receivables	(1.032)	(109)
Inventories	(2.871)	2.215
Other current assets	(4.916)	-
Trade and other payables	(655)	(2.344)
Cash generated from operations	7.460	12.564
Interest paid	(127)	(144)
Taxes paid	(13)	-
Net cash inflow from operating activities	7.320	12.420
Cash outflows to investing activities
Proceeds from sale of property, plant and equipment	3	-
Proceeds from sale of investment property	-	421
Interest received	-	9
Dividends received	220	5
Acquisition of property, plant and equipment	(4.925)	(5.360)
Net cash used in investing activities	(4.702)	(4.925)
Cash flows from financing activities
Proceeds from new loans raised	-	3.340
Repayment of loans	(4.417)	(3.953)
Repayment of leases	(57)	-
Dividends paid	(10.790)	-
Net cash outflows to financing activities	(15.264)	(613)
Net (decrease)/increase of cash and cash equivalents	(12.646)	6.882
Cash and cash equivalents at 1 January	13.782	4.006
Cash and cash equivalents at 30 June	1.136	10.888

Notes to the Consolidated Interim Financial Statements

• 1. The interim financial statements relate to the period from 1 January to 30 June 2021, are not audited by the Company's auditors and were approved by the Board of Directors on 29 July 2021.
• 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 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
	2021 €000	2020 €000	2021 €000	2020 €000
Hellenic Mining Group	-	1	74	69
KEO Plc	-	-	2	3
Cyprus Cement Group	-	-	60	60
Enerco - Energy Recovery Ltd	835	781	866	637
	835	782	1.002	769

5. Μain risks and uncertainties

The uncertain economic conditions, the increased regulatory conditions imposed by the EU ETS, prices for CO² emission rights, 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 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 34 of the Annual Report and Financial Statements for 2020.