Viohalco S.A. — Annual Report (ESEF) 2021

Apr 20, 2022

Untitled Annual Report 2021

@Baltic c onnec tor Oratori senesceret Aquae Sulis, ut cathedras corrumperet chirographi. Umbraculi fermentet rures. Gulosus ossifragi suffragarit quadrupei. Augustus vix comiter conubium santet umbraculi. Oratori spinosus suffragarit Medusa. Ossifragi A. Viohalco 2
B. Message from the President of the Board of Directors 4
C. Business segments 6
D. Financial highlights 2021 10
E. Business segments’ review 16
F. Subsequent events 66
G. Risks and uncertainties 68
H. Non-nancial information report 72
I. Corporate governance statement 92
J. Appendix – Alternative Performance Measures (APMs) 106
K. EU Taxonomy Reporting Principles 110
L. Consolidated nancial statements 2021 and Auditor’s report 115
M. Declaration of responsible persons 194
N. Condensed statutory balance sheet and income statement 195
O. Glossary 197

Table of contents

VIOHALCO | ANNUAL REPORT 2021 2

A. Viohalco

Viohalco S.A. is listed on Euronext Brussels (VIO) and the Athens Stock Exchange (BIO).

• Commercial network in 21 countries
• Products distributed in 105 countries

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ElvalHalcor S.A. a subsidiary of Viohalco, is listed on the Athens Stock Exchange (ELHA).

Viohalco S.A. (‘Viohalco’) is the Belgium-based holding company of leading metal processing companies, which sustainably manufacture aluminium, copper, cables, steel and steel pipes products. Viohalco companies supply high-quality, innovative products to a diverse range of markets, including building and construction, packaging (rigid, semi-rigid and exible), transportation (automotive, shipbuilding and rail), energy and power networks (oshore energy, utilities and power grids, renewable energy, gas and liquid fuels), heating, ventilation, air conditioning and refrigeration (‘HVAC&R’), water supply, telecom mu - nications and printing, along with various industrial applications. Viohalco’s dedicated research, development and innovation (‘R&D&I’) and technology segment focuses on product innovation, industrial research, technological development, engineering applications and ERP application services, to ensure its companies maintain superior product and service quality.

Viohalco is also active in the real estate sector, predominantly in Greece, mainly through a leading Real Estate Investment Company (‘REIC’). Companies in the real estate segment also provide a wide range of additional real estate, property and facility management services to Viohalco subsidiaries.

Production facilities across Greece, Bulgaria, the United Kingdom, Romania, North Macedonia and participations in production facilities in Turkey, Russia and the Netherlands are supported by a strong marketing and sales network. This comprises commercial subsidiaries, agents and distributors, which enable the Viohalco companies to provide comprehensive customer support on a global scale.

Across all segments, Viohalco companies oer products and services that closely align with current global sustainability trends. This reects their ability to meet the evolving needs and commitments of customers, and their commitment as responsible corporate citizens to operate in a sustainable manner. Such trends include a growing commitment to a low carbon, circular economy, reected in rising demand for easily recyclable products, with high recycled content; a clear transition from fossil-fuel consumption to climate neutrality, through the use of renewable energy sources; sustainable urbanisation reected in the rise of energy-ecient buildings and e-mobility; and ongoing technological advancements. A signicant portion of Viohalco companies’ products and solutions caters directly to these trends. These include recyclable aluminium packaging made from secondary raw materials, lightweight and energy- ecient aluminium products, copper products with high recycled content for use in energy eciency and digital applications, circular construction steel products, cables to facilitate the transportation of green energy, steel pipes to support the energy transition, and the development of more environmentally- friendly buildings, among others.

Cenergy Holdings S.A. a subsidiary of Viohalco, is listed on Euronext Brussels and the Athens Stock Exchange (CENER).

VIOHALCO | ANNUAL REPORT 2021 4

B. Message from the President of the Board of Directors

Viohalco companies delivered strong growth and robust nancial performance in 2021, as a testament of their ability to align product oerings with the sustainability megatrends, their measured approach to managing the businesses by optimising utilisation of assets and the implementation of disciplined cost control to drive operating eciencies.

Viohalco achieved consolidated revenue for the year of EUR 5,375 million, compared with EUR 3,850 million in 2020. Consolidated adjusted EBITDA (a-EBITDA) amounted to EUR 426 million in 2021, up from EUR 294 million in 2020, and consolidated prot before income tax amounted to EUR 276 million, compared to EUR 59 million in 2020.

The aluminium segment delivered growth during the year, responding swiftly to improving market demand and strategically operating in sectors that facilitate the energy transition and climate change mitigation. Additional production capacity secured the previous year, through the installation of a new four- stand tandem hot rolling mill, was effectively utilised strengthening Elval’s operational advantage and enabling the business to secure an optimal product mix. Furthermore, the second phase of the segment’s EUR 150 million investment programme was successfully initiated, with the development, among others, of a six-high cold rolling mill and new automated laquering line progressing.

Improved market sentiment drove sales volumes in the copper segment, particularly for alloy rods and tubes and at-rolled products, while improved availability of scrap facilitated an increase in the protability of Halcor, the copper and alloys extrusion division of ElvalΗalcor. Soa Med’s ve-year strategic growth plan remained on track during the year and is expected to be further supported by market conditions which are due to remain favourable in 2022, especially for automotive connectors and energy distribution.

The strength of the cables segment was reected by solid growth across both its projects and products businesses during the period. Hellenic Cables continued to tender throughout the year and was awarded several new projects in the oshore wind and interconnections markets, as well as other contracts, capitalising on its ability to expand into new markets, while strengthening positions in existing markets. Looking ahead, positive market momentum in the oshore wind sector, the segment’s proven ability to expand into new markets and a strong backlog of projects at the end of the year, signals solid growth in the short term. Finally, the segment intends to further leverage its market-leading expertise by further exploring opportunities within the submarine cable industry and the oshore wind sector.

2021 was a challenging year for the steel pipes segment. The energy market rebounded strongly, following a signicant decline in energy consumption and prices during the pandemic. This, coupled with continued postponement and cancellation of multiple fossil fuel distribution projects, led to elevated energy process. Several pipeline projects restarted in the second half of the year however, with natural gas remaining the main intermediate fuel in the global energy transition. Throughout the year, the company has also been leading the technological developments for pipelines certied to transport up to 100% hydrogen, following its long R&D programme and innovation strategy, oil and gas company qualications and geographical dierentiation to enhance competitiveness, including a roadmap towards the digitalisation of its processes. Despite challenges, a strong backlog of projects gives the segment cause for optimism in the near term.

In the steel segment, building on gradual improvements in the second half of 2020, uplift in demand from the construction sector coupled with the segment’s dominant market position in Greece, the Balkans and Cyprus, led to a remarkable performance compared with the previous year. The benefits of cost reduction efforts initiated in 2020 began to flow through, which, together with better business performance, led to significantly improved profitability for 2021.

During 2021, Sidenor was the first steel producer in Greece awarded with the Environmental Product Declaration (EPD) for SD concrete reinforcing steel products (bars and coils, meshes and prefabricated cages) manufactured in Sovel (Almyros, Greece). EPD offers reliable and quantitative information regarding to product’s life cycle and is a significant step towards a more sustainable future. Recent investments to new technologies and innovative solutions have long-term strategic value, strengthen our product portfolio with high quality products, further reduce cost and gradual reduce the environmental footprint of our operations.

Covid-19 pandemic-related relief measures relating to commercial real estate brought in by the Greek government in 2020 remained in force throughout the rst semester of the year, mainly impacting the hospitality and retail sectors. This continued to have an adverse eect on income at Noval Property, Viohalco’s main real estate company. However, the diversity of the segment’s portfolio, coupled with the nancial strength of its tenants and active asset management, enabled Noval Property to avoid arrears in rent or service charges in the period. It continued its investment programme during 2021 and also initiated new projects. In December 2021, Noval Property issued its rst Green Bond Loan of EUR 120 million.# VIOHALCO | ANNUAL REPORT 2021

The Green Bond Loan, which is listed in the Category of Fixed Income Securities at the Regulated Market of the Athens Stock Exchange, is aligned with the International Capital Market Association’s (‘ICMA’) Green Bond Principles and will support the decarbonisation of the building sector in Greece. The issuance supports Noval Property’s scaling strategy by providing funding to pursue new environmentally accredited investments and sustainable property developments, while diversifying its funding sources and optimising its capital structure.

The year 2021 was also an important year for Viohalco and its subsidiaries in the context of sustainability, as the company created a comprehensive framework under which all the subsidiaries are required to operate. The company created an Environment, Social and Governance Roadmap (“ESG Roadmap”) by assessing related risks and opportunities and creating an extensive monitoring system to assess progress over time, while setting improvement targets for the most material issues.

While it is too early to ascertain the full impact of the troubling events in eastern Europe on Viohalco and its companies, Viohalco companies’ overall exposure to Ukraine and Russia is minimal and no immediate material impact is expected. The companies have, of course, taken action to mitigate potential disruption and are monitoring the situation closely. Should the crisis be protracted, compounding issues such as inflation and rising energy prices, Viohalco will reassess and amend its approach accordingly.

As for the Covid-19 pandemic, despite reaching an inflection point in its trajectory some uncertainty persists. We expect this to continue to impact Viohalco and its businesses, albeit to a lesser extent than in 2020 and 2021. Overall, however, we expect uptrends in demand across Viohalco’s product portfolio to continue as normal business operations resume at pace.

In the context of the worldwide climate emergency, Viohalco companies are increasingly well-positioned to benefit from sustainability trends, which will significantly increase demand for circular products. Such products, which are by their nature easily recyclable, produced with high recycled content, and have a low carbon production footprint, constitute a significant proportion of Viohalco’s offering. We continue to deploy resources and investments to ensure that our product and service offering remains at the forefront of our industries, while continuing to cater to these trends.

Across the segments, we continue to take a disciplined approach to executing our strategy. We are investing in optimising production capacities and extending our product and service offering, seeking entry into new markets and solidifying our position in existing markets. At the same time, the companies maintain a customer-centric approach to marketing and product development and drive operating efficiencies by optimising the utilisation of assets and maintaining disciplined cost control.

Viohalco companies continue to prioritise their people, by not only continuing to safeguard their health and wellbeing across all businesses, but also through investment in employee development and training, and new talent. In addition, of paramount importance to all our companies is steadfast adherence to sound business practices, operating in an ethical and responsible manner, and continuously improving their environmental footprint.

Leveraging the strength of our diversified business model and our commitment to our strategic aims, we are confident that Viohalco and its companies will continue to act with agility to turn challenges into opportunities for growth.

Nikolaos Stassinopoulos
President of the Board of Directors

C. Business segments

Viohalco operates under the following organizational structure, which comprises seven business segments:

• Aluminium
  • ElvalHalcor
    • Elval - Aluminium rolling division
    • Elval Colour
    • Etem
    • Bridgnorth Aluminium
    • Etem Bulgaria
• Copper
  • ElvalHalcor
    • Halcor - Copper and alloys extrusion division
    • Sofia Med
    • Cablel Wires
    • Epirus Metalworks
• Steel pipes
  • CPW America
  • Corinth Pipeworks
• Cables
  • Fulgor
  • Hellenic Cables
  • Icme Ecab
• Steel
  • Sovel
  • Sidenor Steel Industry
  • Stomana Industry
  • Dojran Steel
• R&D&I and Technology
  • Elkeme
  • Praksys
  • Teka Systems
• Real estate
  • Noval Property
  • Steelmet Property Services
  • Symetal

Aluminium

The aluminium segment operates through its aluminium rolling division (‘Elval’) and the subsidiaries Symetal S.A. (‘Symetal’), Elval Colour S.A. (‘Elval Colour’), Vepal S.A. (‘Vepal’), Bridgnorth Aluminium Ltd (‘Bridgnorth Aluminium’), Etem Bulgaria S.A. (‘Etem Bulgaria’) and Etem S.A. (‘Etem’). The segment produces flat rolled and extruded products and solutions for a wide range of markets including packaging, transportation, building and construction, HVAC&R, printing, energy, industrial and engineering applications.

Copper

Through its copper and alloys extrusion division (‘Halcor’), and the copper segment’s subsidiaries (Sofia Med S.A ('Sofia Med'), Epirus Metalworks S.A. ('Epirus Metalworks'), Cablel Wires S.A. ('Cablel Wires') and the NedZink BV and HC Isitma joint ventures), manufactures a range of copper, brass and high-performance copper alloys products, as well as titanium zinc products. The copper tubes division has a long history and strong track record of developing products that strengthen its global commercial reach. Halcor and the copper segment subsidiaries provide innovative and value-adding, solutions. Major product categories include copper tubes and rolled and extruded copper alloy products for a wide range of applications, including plumbing, HVAC&R, renewable energy, construction, engineering, automotive and industrial products, fish farming, all types of coin blanks and enamelled wires.

Cables

Viohalco’s cables segment comprises three companies: Hellenic Cables S.A. Hellenic Cables Industry (‘Hellenic Cables’), its Greece-based subsidiary Fulgor S.A. (‘Fulgor’), and Romania-based Icme Ecab S.A. (‘Icme Ecab’), hereafter collectively referred to as ‘Hellenic Cables companies’. The Hellenic Cables companies manufacture land and submarine power cables, telecommunication cables and compounds. Combined, they are the largest cable producer in Greece and Southeastern Europe, exporting to more than 50 countries. A key advantage of the Hellenic Cables companies is their ability to provide turnkey solutions to customers.

Steel pipes

With a manufacturing plant in Greece and extensive expertise in delivering complex projects on a global scale, Corinth Pipeworks S.A. (‘Corinth Pipeworks’) is a supplier of choice of steel pipes and hollow sections to the energy and construction industries. Corinth Pipeworks’ three main product categories are:

• steel pipes for onshore/offshore pipelines for gas and liquid fuel, CO2 and hydrogen transportation, which are manufactured in either Corinth Pipeworks’ high frequency induction welding unit (‘HFW’), the helically-submerged arc welding unit (‘HSAW’), or the longitudinal submerged arc welding unit (‘LSAW/JCOE’);
• casing steel pipes used in exploratory drillings (‘OCTG’);
• hollow structural sections used in the construction sector.

Corinth Pipeworks has extensive experience and a strong track record of implementing complex projects for the energy sector worldwide, both onshore and offshore. The company is an approved supplier to major oil and gas companies and to engineering, procurement and construction (“EPC”) contractors. The Company is ready for the energy shift and is committed in making a positive contribution to the energy transition and to tackle climate change, through new technological solutions that allow the increasing use of renewable sources in the energy mix and through the development of innovative products and the reduction of the carbon footprint of our production activities.

Steel

Sidenor Steel Industry S.A. (‘Sidenor Steel Industry’), Stomana Industry S.A. (‘Stomana Industry’) and their subsidiaries are leading producers of steel products in Southeastern Europe. The steel segment companies have significant expertise and more than 60 years of experience in the manufacture and distribution of steel products, along with an extensive product portfolio which includes long, flat and downstream steel products. The steel segment companies produce a range of value-added products and solutions for industries, including building and construction, mechanical engineering, shipbuilding, road and rail, automotive, as well as mining and tunneling applications. To achieve the optimum balance between operational, commercial flexibility and productivity, the steel segment has adopted the following operational structure:

• mini-mills;
• downstream operations for steel product processing; and
• sales and distribution.

Real estate

Viohalco, through its leading Real Estate Investment Company (‘REIC’), Noval Property, creates value by investing in and commercially developing office, logistics, retail, hospitality and residential buildings in Greece and abroad, and by providing a wide range of real estate services to its subsidiaries, through Steelmet Property Services S.A. In October 2019, Noval Property became a Real Estate Investment Company (‘REIC’) and an internally managed Alternative Investment Fund, following the award of the necessary licenses by the Hellenic Capital Markets Commission. It is already the second largest Greek REIC in terms of property portfolio value. In December 2021, Noval Property successfully issued a Green Bond Loan of EUR 120 million on the Athens Stock Exchange. Noval Property’s portfolio is diversified and comprises 44 high quality properties, mainly located in Greece and selectively, in Bulgaria. It comprises office buildings, shopping centres, logistics and hotels, with a total built-up area of c. 453,000 sq.m.# Steelmet Property Services

Steelmet Property Services supports Viohalco and its subsidiary companies by providing a wide range of centralised real estate, property and facility management services.

R&D&I and Technology

Viohalco’s portfolio includes dedicated research, development and innovation (‘R&D&I’) companies and centres within its subsidiaries. These centres support sustainable growth through the development of innovative and high value-added products, efficient solutions for the optimization of industrial and business processes and the research into the environmental performance of their manufacturing plants.

Notes:
* Cenergy Holdings S.A. (‘Cenergy Holdings’) was founded in 2016, following a cross-border merger by absorption of Corinth Pipeworks Holdings S.A. and Hellenic Cables S.A. Holdings Société Anonyme. Cenergy Holdings is listed on Euronext Brussels and the Athens Stock Exchange.
* In December 2017, the merger by absorption of Elval by Halcor was concluded, while the latter was renamed to ElvalHalcor Hellenic Copper and Aluminium Industry S.A. (‘ElvalHalcor’). ElvalHalcor is listed on the Athens Stock Exchange.

D. Financial highlights 2021

Viohalco companies have clearly articulated growth strategies. Despite operating in different market segments, they share common strategic goals which aim to:

• optimise production capacity and product offering through continuous innovation;
• increase penetration of existing and new markets;
• maintain a customer-oriented approach for marketing and product development;
• drive operating efficiencies by optimising asset utilisation and cost control; and
• operate in a sustainable and responsible manner.

The companies have faced a significant number of external challenges in recent years, including economic uncertainty in key operating markets, metal price fluctuations, depressed demand in energy markets and the wider effects of the Covid-19 pandemic. Despite this, they have maintained a disciplined focus on improving operational performance, implementing a number of initiatives in support of this. Most notably, they have invested heavily in new technologies, R&D&I and upgrading existing facilities, and importantly, have also invested in personnel development, training and safety. These investments have enabled the companies to redefine and improve their product and service offerings across key markets, resulting in the award of numerous significant projects.

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Consolidated revenue amounted to EUR 5,375 million, up 40% versus EUR 3,850 million in 2020. Robust consolidated EBITDA reached EUR 514 million, an increase of 80% versus 2020. Consolidated adjusted EBITDA increased by 45% to EUR 426 million (2020: EUR 294 million). Consolidated profit before income tax amounted to EUR 276 million, compared to EUR 59 million in 2020. Continued investment in capacity optimization combined with prudent cost management drove efficiency and supported improved profitability. Ongoing focus on developing circular products and services that cater to demand driven by rising sustainability megatrends.

VIOHALCO | ANNUAL REPORT 2021

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Overview

In 2021, Viohalco reported strong revenue and profitability with many of its companies delivering impressive growth, despite continued challenges. Viohalco’s companies continued to optimise asset utilization, while implementing prudent cost controls to drive operating efficiencies. The health and wellbeing of Viohalco companies’ employees remained a top priority, and measures to ensure that all employees and other stakeholders stayed safe and healthy remained in force.

In the aluminium segment, the rolling division of ElvalHalcor, Elval, delivered growth during the year responding promptly to improving market demand and strategically supporting sectors that facilitate the energy transition and climate change mitigation. Additional production capacity, provided by the newly installed four-stand tandem hot rolling mill, strengthened Elval’s operational advantage and optimized its product mix. The EUR 150 million second phase of the investment programme, which includes among others the six-high cold rolling mill and the new lacquering line, is progressing. Profitability at Symetal improved as the company adapted to market trends, increasing sales of flexible packaging and lidding foil as demand from the U.S. and European markets rose, and absorbed cost pressures related to energy and raw material price increases. Meanwhile, Etem Bulgaria’s automotive division launched its new BMW project and finalized related investment projects in the pipeline, with the industrial part of the business experiencing significant growth. Demand at Bridgnorth Aluminium returned to pre-pandemic levels which positively impacted volumes. While the company continued to develop its product mix during the year, cost pressures due to inflation resulted in a weaker financial performance.

Improved market sentiment drove increases in volume in the copper segment, with strong demand across most markets at the start of year continuing throughout 2021. The majority of the copper segment’s companies performed well, with increased volume and profitability. Halcor, the copper and alloys extrusion division of ElvalHalcor, achieved a marginal increase in copper tubes sales, but significant growth in sales of alloy rods and tubes which fully recovered in volumes and profitability. Sofia Med’s five-year strategic growth plan remained on track during the year, as sales in both copper and copper alloy rolled products and extruded copper products continued to grow for another year. Healthy demand for enameled wires drove increased sales volumes of Cablel Wires.

The performance of the cables segment was very strong, reflecting solid growth across both the projects and products businesses. All plants maintained a full production schedule throughout the year resulting in further growth in profitability. Hellenic Cables continued its tendering efforts and was awarded several new projects in the offshore wind and interconnections markets, along with frame contracts from major transmission system operators (TSOs). Sales volumes of the products business unit increased as a result of an upturn in demand and the unit’s successful commercial strategy. Investment in Hellenic Cables’ submarine plant in Corinth to expand its inter-array cables capacity continued during the year and is almost complete. By the end of the year, the order backlog of the segment exceeded EUR 650 million.

VIOHALCO | ANNUAL REPORT 2021

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The steel pipes segment experienced a challenging year. A recovery in energy consumption from depressed levels during the pandemic, coupled with reduced supply capacity because of the postponement and cancellation of multiple fossil-fuel distribution projects, led to exceptionally high energy prices. In the second half of 2021, however, several pipeline projects resumed to facilitate the transfer of natural gas, the key intermediate fuel in the global energy transition. Initiatives to enhance Corinth Pipeworks’ competitive advantage continued, including the delivery of a programme of major energy company qualifications and the development of pipelines certified to transport up to 100% hydrogen. Finally, at the end of the year, the backlog increased reaching EUR 350 million.

The steel segment experienced a gradual uplift in demand during the year and maintained its dominant market position in Greece, the Balkans and Cyprus. The combination of these factors led to a remarkable performance for the year which, coupled with the emerging benefits of cost reduction efforts initiated in 2020, resulted in significantly improved profitability. During the year, Sidenor was the first steel producer in Greece to be awarded the Environmental Product Declaration (EPD) for SD concrete reinforcing steel products. This certification provides important information on a product’s life cycle, vital to improving sustainability in production. In addition, recent investments in new technologies and innovative solutions are expected to deliver long-term strategic value, strengthen the segment’s product portfolio, further reduce costs and gradually limit the environmental footprint of operations.

In the real estate segment, Noval Property continued its investment programme during 2021. Among other projects, the expansion of the River West shopping centre was completed, boosting the value of investment property and increasing rental incomes for the REIC. In addition, the fourth quarter of 2021 saw Noval Property acquire (in a joint venture with a real estate fund) a prime plot of land in Athens, where a large-scale environmentally friendly office complex will be developed.

In November 2021, ElvalHalcor successfully issued a EUR 250 million Bond Loan. In December 2021, Noval Property successfully issued a Green Bond Loan of EUR 120 million. Both bonds have a seven-year term and are listed on the Athens Stock Exchange.

Finally, in 2021 Viohalco developed a comprehensive plan and a roadmap for its subsidiaries to monitor all environmental, social and governance risks. This includes tracking a broad range of performance indicators to measure progress and risk mitigation. Furthermore, Viohalco subsidiaries focused on increasing the share of recycled metals used in raw material input, as well as reducing the companies’ operational carbon footprint to help their customers reach their own sustainability goals.# VIOHALCO | ANNUAL REPORT 2021

Financial overview

Summary consolidated statement of profit or loss

Amounts in EUR thousands

	2021	2020*
Revenue	5,374,512	3,850,077
Gross profit	590,645	349,043
EBITDA	514,285	285,340
a-EBITDA	426,017	294,463
EBIT	374,396	153,321
a-EBIT	286,128	162,443
Net finance cost	-95,882	-92,307
Profit before tax	275,984	59,273
Profit for the period	219,989	32,771
Profit attributable to owners of the Company	194,994	21,377

• The comparative information is restated due to retroactive application of the IFRIC Agenda Decision ‘Attributing Benefit to Periods of Service’.

Viohalco’s consolidated revenue for 2021 was EUR 5,375 million, up 40% compared to 2020 (EUR 3,850 million), reflecting an upturn in demand across almost all segments and the rise in metal prices. Consolidated a-EBITDA increased by 45% to EUR 426 million for 2021 (2020: EUR 294 million). Net finance cost stood at EUR 95.9 million (2020: EUR 92.3 million). Viohalco’s consolidated profit before income tax for the period amounted to EUR 276 million, compared to EUR 59 million in 2020, mainly attributable to the noticeable recovery of the steel segment, the solid growth across both the projects and the products business of the cables segment and the continuous rise in demand of the aluminium and copper segments.

Summary consolidated statement of financial position

Amounts in EUR thousands

	31/12/2021	31/12/2020*
Fixed & intangible assets	2,446,354	2,302,552
Other non-current assets	74,450	75,126
Non-current assets	2,520,805	2,377,678
Inventory	1,469,840	1,074,589
Trade and other receivables (incl. contract assets)	724,907	515,976
Cash and cash equivalents	503,267	219,161
Other current assets	19,602	10,109
Current assets	2,717,616	1,819,835
Total assets	5,238,420	4,197,513
Equity	1,655,594	1,395,253
Loans and borrowings	1,294,093	1,001,986
Other non-current liabilities	222,987	215,586
Non-current liabilities	1,517,080	1,217,572
Loans and borrowings	848,145	746,010
Trade and other payables (incl. contract liabilities)	1,145,287	807,130
Other current liabilities	72,314	31,548
Current liabilities	2,065,746	1,584,687
Total equity and liabilities	5,238,420	4,197,513

• The comparative information is restated due to retroactive application of the IFRIC Agenda Decision ‘Attributing Benefit to Periods of Service’.

Capital expenditure for the period amounted to EUR 266 million (2020: EUR 285 million), mainly attributable to the aluminium segment’s investment programme (including the advanced six-high cold rolling mill and automated lacquering line), investments in Hellenic Cables’ submarine cables production plant in Corinth, and infrastructure improvement investment in the steel segment. Working capital increased by 30%, or EUR 235 million, compared to 31 December 2020, as a result of the increases in metal prices and sales volumes. Viohalco companies’ net debt increased to EUR 1,684 million (31 December 2020: EUR 1,581 million) before IFRS 16 adjustment, mainly attributed to the increase in working capital. After adjusting for IFRS 16, net debt amounted to EUR 1,664 (31 December 2020: EUR 1,560 million).

VIOHALCO | ANNUAL REPORT 2021

Performance by business segment

Amounts in EUR thousands

Segments	Revenue	EBITDA	a-EBITDA	EBIT	EBT
	2021	2020*	2021	2020*	2021
Aluminium	1,677,918	1,167,735	138,327	89,875	122,508
Copper	1,563,775	1,066,014	94,338	47,680	60,465
Cables	757,170	568,615	84,287	72,046	89,623
Steel pipes	225,067	304,824	555	21,106	14,141
Steel	1,067,782	677,939	160,316	29,917	123,654
Real estate	18,667	10,041	27,921	20,409	6,618
Other activities	64,134	54,909	8,541	4,308	9,008
Total	5,374,512	3,850,077	514,285	285,340	426,017

• The comparative information is restated due to retroactive application of the IFRIC Agenda Decision ‘Attributing Benefit to Periods of Service’.

Outlook

In 2022, Eurozone inflation, rising energy prices and geopolitical tension are expected to affect the business during the year. However, as the pandemic recedes, wider market conditions are expected to be increasingly favourable with recovery across a number of markets, including the automotive, industrial and construction sectors, among others. Encouraging upward trends in demand for products and services across Viohalco’s segments are evident. While it is too early to ascertain the full impact of the troubling events in eastern Europe on Viohalco and its companies, overall exposure to Ukraine and Russia is minimal and, as such, no immediate material impact is expected. Viohalco and its companies have taken action to any mitigate potential disruption and are monitoring the situation closely. Should the crisis be prolonged compounding issues, such as inflation and rising energy prices, Viohalco will reassess and amend its approach accordingly. Viohalco companies are very well-positioned to benefit from sustainability trends which increase demand for low carbon products. Such products, which are also highly recyclable, are produced with high recycled content, contributing to a circular economy and replacing primary metals with much higher carbon content, make up a significant proportion of Viohalco’s offering and are expected to be in high demand during 2022 and beyond. Viohalco will continue to take a dynamic approach to executing its strategy, which is already delivering tangible results. Its companies plan to invest further in optimizing production capacities and will maintain a sharp focus on innovation to extend their product and service offering, enhancing their competitive advantage. On an ongoing basis, Viohalco companies will seek to enter new markets and solidify positioning in existing markets, maintaining a customer-oriented approach to marketing and product development. Furthermore, they will continue to prioritize their people, safeguarding their health and wellbeing, and investing in employee development, training, and attracting new talent. Finally, Viohalco companies maintain their strong commitment to sustainability, as they continue to support the energy transition and endeavor to capture global megatrends.

Revenue in EUR million

Year	2017	2018	2019	2020	2021
	3,721	4,406	4,198	3,850	5,375

% per segment

Segment	2017	2018	2019	2020	2021
Aluminium	29%	31%	31%	29%	29%
Copper	14%	20%	20%	21%	29%
Cables	20%	20%	20%	20%	14%
Steel pipes	4%	3%	3%	3%	4%
Steel	2%	2%	2%	2%	20%
Real estate & Other	31%	24%	24%	24%	3%

a-EBITDA in EUR million

Year	2017	2018	2019	2020	2021
	284	313	303	294	426

% per segment

Segment	2017	2018	2019	2020	2021
Aluminium	29%	16%	21%	29%	29%
Copper	29%	21%	29%	3%	4%
Cables	3%	4%	4%	4%	2%
Steel pipes	2%	2%	2%	2%	2%
Steel	31%	46%	31%	31%	31%
Real estate & Other	7%	7%	4%	4%	2%

E. Business segments’ review

Aluminium

Revenue (EUR thousands)
2021: 1,677,918
2020: 1,167,735

EBITDA (EUR thousands)
2021 : 138,327
2020: 89,875

a-EBITDA (EUR thousands)
2021 : 122,508
2020: 94,968

Aluminium segment Activities

Viohalco’s aluminium segment, through its aluminium rolling division (‘Elval’), and its subsidiaries Symetal, Elval Colour, Vepal, Bridgnorth Aluminium, Etem Bulgaria and Etem, manufacture a variety of aluminium rolling and extrusion products for a wide range of markets and applications. The aluminium segment offers rolled products and solutions for:

• Packaging (rigid and flexible packaging solutions, beverage and food cans, closures, household products, pharmaceutical and aseptic packaging foil);
• Transportation (automotive, marine, road and rail industries, as well as the HVAC&R sector);
• Construction (mill finish and coated aluminium sheets and coils for the entire building envelope, such as etalbond® aluminium composite panel, orofe® and Ydoral® coated coils, sheets and strips for roofing applications and rain gutters);
• Industrial applications (aluminium sheets, coils and circles for general engineering, renewable energy and household applications);
• Lithographic coils used as a substrate in the manufacture of printing plates;
• Extruded products;
• Architectural systems (aluminium systems for doors, windows, dynamic building facades, curtain wall systems, interior applications, corporate ID applications, sun shading systems, rolling shutters, ventilated façades systems and security systems);
• Industrial aluminium applications (aluminium profiles and processed hard alloy bars for industrial use, general engineering applications, building applications, energy applications and transportation);
• Automotive applications (extruded aluminium profiles and parts that have undergone special tooling and machining and are used in car chassis, suspension systems and doors and decorative aluminium profiles for roof railings, aluminium composite panels for special automotive applications).

Aluminium

• ElvalHalcor
• Elval - Aluminium rolling division
• Elval Colour
• Etem
• Bridgnorth Aluminium
• Etem Bulgaria
• Symetal

VIOHALCO | ANNUAL REPORT 2021

Production facilities

Viohalco’s aluminium companies operate the following state-of-the-art production facilities:

• Elval rolling plant (Oinofyta, Greece)
  • 375,000 tons
• Flat rolled aluminium products for contemporary applications in packaging, building and construction, sea, road and rail transportation, automotive, industrial, energy, cookware and HVAC&R markets
• Anoxal (Agios Thomas, Greece)
  • 50,500 tons
  • Recycling and casting aluminium
• Vepal (Thiva, Greece)
  • 40,500 tons
  • Manufacturing billets and slabs
• Elval Colour (Agios Thomas, Greece)
  • 52,000 tons
  • Aluminium products for the construction, food and automotive industries
• Symetal aluminium foil rolling plant (Oinofyta - Viotia, Greece)
  • 26,000 tons
  • Extensive range of coated aluminium products and
• Symetal aluminium foil converting plant (Mandra - Attica, Greece)
  • 30 M meters
• Viomal (Nea Artaki - Evia, Greece)
  • 127,000 tons
• Bridgnorth Aluminium (Bridgnorth, UK)
  • 30,000 tons
• Etem – Gestamp Bulgaria (Sofia, Bulgaria)
  • 18,000 tons
• Etem (Magoula- Attica, Greece)# VIOHALCO | ANNUAL REPORT 2021

■ Key Financials
Amounts in EUR thousands

	2021	2020*
Revenue	1,677,918	1,167,735
Gross profit	147,873	100,469
Gross profit (%)	8.8%	8.6%
EBITDA	138,327	89,875
EBITDA (%)	8.2%	7.7%
a-EBITDA	122,508	94,968
a- EBITDA (%)	7.3%	8.1%
EBIT	79,234	35,899
EBIT (%)	4.7%	3.1%
a-EBIT	63,415	40,992
a-EBIT (%)	3.8%	3.5%
Profit before tax	59,556	21,529

• All percentages are vs Revenue
• The comparative information is restated due to retroactive application of the IFRIC Agenda Decision “Attributing Benefit to Periods of Service”.

2021 Financial performance

In 2021, revenue increased by 44% to EUR 1,678 million (2020: EUR 1,168 million), while profit before income tax amounted to EUR 60 million (2020: EUR 22 million). Elval, ElvalHalcor’s aluminium rolling division, recorded strong growth for the year, as a result of responding swiftly to increased market demand through an expanded product offering, and a robust and agile business model. Elval’s innovative solutions portfolio, primarily aimed at the packaging, transportation, and building and construction sectors, strategically supported market segments that facilitate the energy transition and climate change mitigation.

Sales volumes at Elval increased significantly by 19%, compared with 2020 (2021: 331k tons; 2020: 279k tons), mainly due to high demand in the packaging and transportation sectors during the year. The final determination of antidumping duty (AD) in March 2021, which calculated a final dumping margin of 0% for imports from ElvalHalcor, positively affected sales growth in the US market. Moreover, the combination of market optimism and increased demand in aluminium products led to a rapid rise in the London Metal Exchange’s (LME) average cash price per ton, amounting to EUR 2,101 in 2021 (2020: EUR 1,490). Additional production capacity provided by the newly installed four-stand tandem hot rolling mill, further strengthened Elval’s operational advantage and secured an optimum product mix. The EUR 150 million second phase of the investment programme, which includes among others the six-high cold rolling mill and the new automated lacquering line, is also progressing.

Elval strengthened customer relationships across all geographies and capitalized on favourable market conditions and strong demand. It focused on embedding business practices and emerging technologies that support responsible production and sustainable supply chains and certified its production facility to the Aluminium Stewardship Initiative (ASI) Chain of Custody Standard. This complements the ASI Performance Standard, enabling Elval to offer customers ASI-certified aluminium products manufactured from material sourced and processed within responsible supply chains certified by the ASI. Elval also received AS9100D Standard certification, the International Quality Management System Standard for the Aviation, Space and Defense (AS&D) industry. Aluminium is the dominant metal in aerospace engineering and, with the AS9100D Standard certification, Elval can expand its solutions portfolio offering and pursue opportunities across the aerospace supply chain.

At Symetal, while demand for aluminium foil products increased rapidly during the year, foil deliveries were adversely impacted by supply chain disruption, the increased cost of raw materials and rising energy prices. Having adapted successfully to market trends, however, Symetal increased profitability by focusing on the sale of higher value-added products. The company increased sales of flexible packaging and lidding foil, as demand from U.S. and European markets rose throughout the year, and successfully absorbed cost pressures related to energy and raw material price increases. Symetal also invested in the production of sustainable and high value-added products in response to global trends. The company initiated the installation of a new lacquering line in Mandra plant, Greece, which will commence operations in early 2022 and will gradually increase the production of lacquered foil products.

Etem Bulgaria’s automotive division launched its new BMW project in 2021, while other projects in the pipeline entered final preparation stages. The company’s sales were not impacted by the microchip supply crisis or other supply chain difficulties during the year, and the industrial part of the business grew by approximately 38%, in terms of volume, compared with 2020. The company’s investment plan was supported by healthy free cash flow, despite increased energy costs and a rally in aluminium prices. The optimization of Etem Greece’s product portfolio, together with operational improvements and increased production at the Magoula plant, Greece, led to an improved performance in 2021. Etem Greece posted double-digit volume growth in its core architectural systems sales business, while its custom-tailored industrial profiles sector also saw significant volume growth.

VIOHALCO | ANNUAL REPORT 2021 21

At Bridgnorth Aluminium, demand returned to pre-pandemic levels and the company recorded its second highest annual volume in its history. The company continued to develop its product range, supplied increased volumes to the rigid packaging and distribution sectors, and installed a coil levelling and sheeting line. Financially, Bridgnorth Aluminium faced inflationary headwinds from significant increases in LME premium, energy costs, freight, and packaging.

Outlook

By processing aluminium, with its recyclable properties and numerous rolling possibilities, to manufacture products and provide solutions that enable a more sustainable future, Elval is strategically positioned to capture growth opportunities created by the global response to climate change, quest for energy efficiency and the move to the circular economy. New investments, including the six-high cold rolling mill and the automated lacquering line, will further enhance product quality, securing the long-term capacity, efficiency, and flexibility to execute Elval’s strategic priorities.

Going forward, Symetal remains focused on capitalising on demand for lacquered products and flexible packaging foil, retaining market share in the flexible packaging market, and increasing production of lacquered products once the new lacquering line investment is complete. In 2022, sales growth across both the automotive and industrial businesses is expected, following the expansion of production capacity and encouraging evidence of continued strong demand. Challenges remain, however, as energy costs and eurozone inflation rates continue to rise.

Looking ahead, Etem will remain focused on increasing its share of architectural profiles in its home markets (the key Balkan countries) and will continue to implement strategic and operational improvements to enhance value.

Looking ahead, Bridgnorth’s demand levels are expected to remain robust throughout 2022, and the company is well positioned to mitigate the effect of inflationary pressures.In addition, the company plans to further develop its product range and customer mix. Further information about the companies is available on their corporate websites: Elval: www.elval.com Symetal: www.symetal.gr Bridgnorth Aluminium: www.bridgnorthaluminium.co.uk Elval Colour: www.elval-colour.com Etem (Greece): www.etem.gr Viomal: www.viomal.com

Copper

Copper segment Activities

The copper segment companies manufacture a wide range of copper, brass and high-performance copper alloys products, as well as titanium zinc products. The segment comprises a copper and alloys extrusion division (‘Halcor’), and its subsidiaries Sofia Med S.A., Epirus Metalworks S.A., Cablel Wires S.A., and the NedZink BV and HC Isitma joint ventures. Halcor offers a diverse product range including copper and brass tubes, along with extruded and rolled products. It continuously seeks to grow its network and market share, both in Europe and the rest of the world, via its subsidiaries and commercial partners, and by entering new markets, investing in innovative sustainable technologies, and delivering high added-value products and solutions. The main product categories of Halcor and the copper segment are:

• Copper tubes: Talos®, Talos® Ecutherm, Cusmart®, Talos® Plastic Coated, Talos® Gas, Talos® Med, Talos® ACR, Talos® ACR Inner Grooved, Talos® ACR Ecutherm™, Talos® ACR Ecutherm II, Talos® Geotherm, Talos® Ecutherm Solar, Talos® Solar Plus, Talos® ACR Linesets, Talos® Form, Talos® Sprinkler, Talos® XS, Talos® Plated, Talos® S80 and Talos® S60.
• Rolled products: all shapes strips (including hot dip tinned surface), reoofing strips Doma® foil, sheets, Sheets for roofing Doma® discs, circles and plates in all alloys as copper, brass and special high performance alloys.
• Extruded products: copper bus bars, rods, wires, profiles, fabricated parts with tin and silver surface coating (electroplating) options, brass copper alloy rods and tubes, sections and wires, and UR30® copper alloy wire and net cages for aquaculture and fish farming.
• Coin blanks: monochrome coin blanks, outer rings for bi-colour blanks, inner blanks for bi-colour blanks, electroplated bi-colour coin blanks and assembled bi-colour coin blanks in a wide range of colors and material combinations.
• Rolled titanium zinc products: coils, strips, sheets, accessories.
• Enamelled wires: round and rectangular copper wires, round aluminium wires, copper welding wires.

Copper
ElvalHalcor
Halcor - Copper and alloys extrusion division
Sofia Med
Cablel Wires
Epirus Metalworks

VIOHALCO | ANNUAL REPORT 2021 25

■ Production facilities

The copper segment’s industrial base comprises the following manufacturing facilities:

Plant	Production focus	Annual production capacity	Quality and management systems certifications
Halcor foundry (Oinofyta, Greece)	Semi-finished copper	235,000 tons	ISO 9001:2015, ISO 14001:2015, ISO 45001:2018, ISO 50001:2018
Halcor copper tubes (Oinofyta, Greece)	Copper tubes for: Building installations including plumbing, heating, floor heating and cooling, natural and interior gas networks, HVAC&R, solar system application, industrial networks and fittings. HVAC&R applications including heating, ventilation, air-conditioning, refrigeration, heat exchangers, heat pump systems and fittings. Renewable energy applications including solar panels, solar system networks, geothermal heating and cooling. Industrial applications including heating, ventilation, air-conditioning, refrigeration, heat exchangers, electrical and mechanical engineering.	80,000 tons	ISO 9001:2015, ISO 14001:2015, ISO 45001:2018, ISO 50001:2018
Halcor extrusion for brass and copper alloy products (Oinofyta, Greece)	Copper alloys, Brass products in billet and slab form	40,000 tons	ISO 9001:2015, ISO 14001:2015, ISO 45001:2018, ISO 50001:2018
Sofia Med copper and copper alloys processing plant (Sofia, Bulgaria)	Solid and hollow copper alloy rods and sections, Copper alloy wire and bars, Seamless and welded copper alloy tubes of different cross-sections, Copper alloy wire cage nets for farming aquaculture	140,000 tons	Products comply with several quality specifications (EN, DIN, BS, ASTM, JIS)
Cablel Wires enameled wires plant (Livadia, Greece)	Copper and aluminium enameled wires (round and rectangular)	8,500 tons copper and aluminium enameled wires, 3,500 tons bare wires	ISO 9001:2015, ISO 14001:2015, ISO 45001:2018, ISO 26000:2010, ISO 50001:2011, IATF 16949:2016
Epirus Metalworks (Epirus, Greece)	Copper, brass, high performance rolled products, Copper bus bars, Rod profiles, Wires, Additional capabilities for tintin and silver plating	10,000 tons	ISO 9001 :2015, ISO 14001 :2015, ISO 45001:2018, IATF 16949:2016, ISO 50001:2018
HC Isitma (Gebze, Turkey)	All types of coin blanks, Rings for bi-colour coins	10,000,000 m.	ISO 9001:2015, ISO 14001:2015, ISO 50001:2018
NedZink (Budel-Dorplein, the Netherlands)	Ecutherm copper tubes, Corrugated A/C drain hoses, Titan zinc coils, sheets, strips, gutters and other accessories for roofing	36,000 tons	NEN-EN-ISO 9001:2015

VIOHALCO | ANNUAL REPORT 2021 26

■ Key financials

Amounts in EUR thousands

	2021	2020*
Revenue	1,563,775	1,066,014
Gross profit	125,054	73,940
Gross profit (%)	8.0%	6.9%
EBITDA	94,338	47,680
EBITDA (%)	6.0%	4.5%
a-EBITDA	60,465	52,084
a- EBITDA (%)	3.9%	4.9%
EBIT	77,672	32,413
EBIT (%)	5.0%	3.0%
a-EBIT	43,800	36,817
a-EBIT (%)	2.8%	3.5%
Profit before tax	58,979	16,000

* The comparative information is restated due to retroactive application of the IFRIC Agenda Decision “Attributing Benefit to Periods of Service”.
- All percentages are vs Revenue

■ 2021 Financial performance

Revenue amounted to EUR 1,564 million versus EUR 1,066 million in 2020, driven by increased sales volumes and an uptrend in the price of copper. Profit before income tax amounted to EUR 59 million (2020: EUR 16 million). Strong demand across most markets at the start of the year was maintained throughout 2021. The majority of the segment’s companies performed well in their respective markets, with recovery in copper alloy markets and continued growth in the flat-rolled products market boosting sales volumes. The average price of copper stood at 7,881 EUR/t compared with 5,395 EUR/t in 2020, as metal prices continued to rise across international markets throughout 2021. Copper tube sales amounted to 75.3k tons in 2021 compared with 74.6k tons in 2020, growing by 0.9%, as strong demand was offset by capacity constraints and an unscheduled shutdown of Halcor’s copper tubes plant in Oinofyta. Overall profitability grew also due to improved availability of scrap in the first three quarters. In the last quarter of 2021, the effects of supply chain disruption due to the pandemic became more prominent, but were mitigated with spot material supplies in response to delayed shipments and lower scrap availability. In addition, efforts were made to pass on the effect of rising energy prices to conversion prices. Finally, healthy demand for enameled wires supported increased sales volumes of Cablel Wires against the prior year. Sofia Med’s five-year strategic growth plan is on track, and the company continued to gain market shares and volumes, with a year-on-year sales growth of 8.7%. Market conditions were favourable, with automotive connectors and energy distribution experiencing particularly strong demand. Sofia Med adjusted its production and product portfolio to align with prevailing market dynamics more closely, focusing on more demanding products. This will enable the company to continue expanding its customer base and market share in the coming years, especially since it has now received approval as a “regular supplier” from key international customers with high demand and potential.

■ Outlook

In 2022, market conditions in the copper segment are expected to remain favourable as the pandemic gradually recedes. The tubes mill is operating almost at capacity and, as such, current efforts are focused on improving efficiency and increasing output. Production of copper and copper alloy rolled products is expected to continue rising, as the factors driving long-term demand are sustained. Finally, continuous investment in higher value-added products is expected to lead to further product portfolio improvements and copper segment profitability.

Further information about the companies is available on their websites:
Halcor: www.halcor.com
Sofia Med: www.sofimed.com
Cablel Wires: www.cablelwires.com
Epirus Metalworks: www.epirusmetalworks.com
NedZink: www.nedzink.com

27 VIOHALCO | ANNUAL REPORT 2021 28 Aluminium products VIOHALCO | ANNUAL REPORT 2021 29 Copper products 30 ElvalHalcor S.A.

Formed in December 2017, through the merger of Elval, a leading European aluminium rolling company, and Halcor, the largest copper tubes producer in Europe, ElvalHalcor Hellenic Copper and Aluminium industry S.A. (‘ElvalHalcor’) is a leading global industrial manufacturer of aluminium and copper products. As a combined entity, ElvalHalcor leverages synergies in innovation, technology, R&D&I, procurement, marketing, infrastructure and sustainability to produce high-quality, value added solutions for customers globally. ElvalHalcor’s success is driven by its customer-focused philosophy, commercial export efforts and continuous innovation achieved through ongoing investment in R&D&I. The company has over 80 years of experience, a strong production base across 16 industrial units, a market presence in over 90 countries, and highly experienced specialist personnel. ElvalHalcor is a key player in the non-ferrous metals industry. It effectively navigates the challenges of the evolving business environment, whilst generating value for its stakeholders through sustainable growth and development.# 31 ElvalHalcor is active in a number of dynamic, growing markets, including: • Packaging (food and beverages); • Road, sea and rail transportation; • Automotive; • Heating, ventilation, air conditioning and refrigeration (‘HVAC&R’); • Building and construction; • Renewable energy; • Shipbuilding • Energy and power networks; • Electronics and electrical; • Water supply; • Industrial and engineering applications; • Other applications. ElvalHalcor is listed on the Athens Stock Exchange (ELHA). Further information on ElvalHalcor is available on the website: www.elvalhalcor.com

32 VIOHALCO | ANNUAL REPORT 2021

33 Revenue (EUR thousands)

2021 : 757,170
2020: 568,615

EBITDA (EUR thousands)

2021 : 84,287
2020: 72,046

a-EBITDA (EUR thousands)

2021 : 89,623
2020: 81,495

Cables

34 Cables segment Activities

The cables segment comprises three companies: Hellenic Cables S.A., Greece-based Hellenic Cables Industry (‘Hellenic Cables’) and its subsidiary Fulgor S.A. (‘Fulgor’), and Romania-based Icme Ecab S.A. (‘Icme Ecab’). Hereafter collectively referred to as the ‘Hellenic Cables companies’. The Hellenic Cables companies are approved suppliers to some of the largest international electricity network operators and have one of the biggest and most advanced submarine cable plants in the world. They offer a variety of products including underground and submarine power cables (low, high and extra high voltage), telecommunications cables, enameled wires, copper wires and compounds. Over the past decade, the Hellenic Cables companies have collectively established themselves as the largest producer of cables in Greece and Southeastern Europe. They have a strong international focus, exporting to more than 50 countries worldwide. Their key product categories are as follows:

• Power cables: low, medium, high and extra high voltage submarine and land cables, umbilical cables, subsea flexible pipes, control cables, cables for industrial applications and external installations, fire-retardant, fire-resistant and halogen-free cables, marine cables, copper and aluminium conductors, ACSR and ACSS/TW conductors;
• Telecommunications cables: conventional telephone cables, telephone exchange and data transmission cables (LAN), fibre-optic (single-mode and multi-mode), submarine cables, and signaling cables;
• Plastic and rubber compounds: PVC-based plastic compounds, low smoke halogen free polyolefin-based plastic compounds and rubber compounds.

The Hellenic Cables companies have an established Project Management Office (‘PMO’) and, where appropriate, use their own specialised assets, trained personnel, and experienced subcontractors to offer complete "turnkey" projects in Greece and internationally. The cable companies’ capabilities include the following:

• System design and engineering;
• Cable route survey;
• Design and manufacture of suitable underground and submarine cable types;
• Loading and transportation of cables to the project site;
• Installation of cables (with the use of specialised cable laying vessels for submarine cables);
• Protection of cables along cable routes;
• Supply and installation of repair joints, transition joints and cable terminations;
• Supply and installation of terminal equipment;
• System testing and commissioning;
• Project management;
• Training of customer personnel in system operations;
• Provision of maintenance and repair solutions.

Hellenic Cables and its subsidiary, Fulgor, were recently awarded several high-profile projects by major utilities companies across Europe. This is testament to the leading positions that the Hellenic Cables companies have established in both the submarine cable manufacturing sector and the wider global offshore energy industry.

Cables

Fulgor

Hellenic Cables

Icme Ecab

VIOHALCO | ANNUAL REPORT 2021

35

■ Production facilities

The cables segment’s production base comprises five plants:

Plant	Production focus	Annual production capacity	Quality and management systems certifications
Hellenic Cables power and optical fibres Cable plant (Thiva, Greece)	• Low voltage (‘LV’) power cables • Medium voltage (‘MV’) power cables • High voltage (‘HV’) power cables • Extra high voltage (‘EHV’) power cables up to 500 kV • Fibre optic cables	60,000 tons • 50,000 tons of cables • 120,000 tons of 8mm diameter copper wire rod	ISO 9001:2015, ISO 14001:2015, ISO 45001:2018, ISO 50001:2018, ISO 22301:2019, ISO 27001:2013 Authorised Economic Operator (AEO), Safety Culture Ladder-Step 4, VCA/SCC, Petrochemicals 2017/6.0
Fulgor Submarine cable plant and port (Corinth, Greece)	• MV submarine power cables • HV submarine power cables • Fiber optic submarine cables	50,000 tons	ISO 9001:2015, ISO 14001:2015, ISO 45001:2018, ISO 50001:2018, ISO 22301:2019, ISO 27001:2013 Authorised Economic Operator (AEO), Safety Culture Ladder-Step 4, VCA/SCC, Petrochemicals 2017/6.0
Icme Ecab power and telecom cables plant (Bucharest, Romania)	• LV, MV and HV power cables • Copper and aluminium wire rods • Cables for indoor installations, energy, control, industrial and external applications, • LV and MV power cables • Fire-retardant, fire-resistant and halogen-free cables • Mine cables • Marine and special-requirement cables • Telecommunication cables (including signaling, remote control and data transmission)	24,000 tons	ISO 9001:2015, ISO 14001:2015, ISO 45001:2018
Hellenic Cables plastic and rubber compounds plant (Oinofyta, Greece)	• Copper and aluminium conductors • Plastic and rubber compounds • PVC and rubber compounds	16,500 tons	ISO 9001:2015, ISO 14001:2015, ISO 45001:2018, ISO 50001:2018, ISO 27001:2013 Authorised Economic Operator (AEO)
Lesco Ltd wooden packaging products plant (Blagoevgrad, Bulgaria)	• Wooden reels and pallets

36

■ Key financials

Amounts in EUR thousands

Amounts in EUR thousands	2021	2020*
Revenue	757,170	568,615
Gross profit	94,442	81,605
Gross profit (%)	12.5%	14.4%
EBITDA	84,287	72,046
EBITDA (%)	11.1%	12.7%
a-EBITDA	89,623	81,495
a- EBITDA (%)	11.8%	14.3%
EBIT	67,629	56,929
EBIT (%)	8.9%	10.0%
a-EBIT	72,964	66,379
a-EBIT (%)	9.6%	11.7%
Profit before tax	45,754	35,549

• All percentages are vs Revenue
• The comparative information is restated due to retroactive application of the IFRIC Agenda Decision “Attributing Benefit to Periods of Service”.

■ 2021 Financial performance

Revenue for the segment amounted to EUR 757 million (2020: EUR 569 million) and profit before tax to EUR 46 million (2020: EUR 36 million). The performance of the cables segment reflects strong growth in both the projects business, owing to efficient execution of recent orders, and the products business, as a result of significant increases in the volume of cables products compared with 2020. Additionally, all plants maintained a full production schedule, resulting in further growth in profitability. Hellenic Cables continued its tendering efforts and was awarded several new projects in the offshore wind and interconnections markets, along with frame contracts from major transmission system operators (TSOs). At the same time, a number of projects were successfully delivered, in full or partially, throughout 2021 including:

• The 178 km-long submarine and underground electrical interconnection between Crete and Peloponnese in Greece, one of the most demanding projects ever completed worldwide (the longest and deepest – 1,000m – HVAC interconnection). This was successfully installed and electrified in May.
• Electrical tests of the 150 kV high voltage submarine cable, that 37 connects Skiathos island to the Greek National Transmission System, were successfully completed early in 2021.
• The production of all 66kV inter-array cables for the Seagreen offshore wind farm in the UK was completed and deliveries are expected to be concluded early in 2022.
• Production for phase B of the Hollandse Kust Zuid project in the Netherlands was also completed, with delivery of the two 220kV subsea cables completed in the second quarter of 2021.
• Production for the submarine cables for the Kafreas II Wind Farm interconnection in Greece was concluded, on schedule, during Q4 2021.

Sales volumes for the products business unit increased by 14% in 2021, as a result of an upturn in demand and successful commercial strategy. This, together with improved product mix, positively impacted the segment’s profitability. Finally, investment in the Hellenic Cables’ plant in Corinth to expand the inter-array cables capacity is almost complete.

■ Outlook

Building on its strong performance in 2021, and considering the current macroeconomic environment, the cables segment is expected to continue to benefit from a robust set of secured projects and significant new orders (e.g. the Sofia Offshore Wind Farm (OWF) project in the UK, and the Vesterhav OWF project in Denmark, among other). Positive market momentum, indicating strong potential in the offshore wind sector, and the segment’s proven ability to expand into new markets, signals solid growth in the short term. The submarine projects business is expected to retain high-capacity utilisation throughout 2022, driving profitability across the entire segment. Additionally, the announced possible partnership with Ørsted, world leader in offshore wind development, for the establishment of a submarine inter array cable factory in the State of Maryland, USA, is an example of opportunities created by the market’s positive potential. In the onshore projects business, several awards in the UK reflect Hellenic Cables’ continuous presence and investment in this market, while its strong positioning in other markets, such as the Eastern Mediterranean and Central Europe, points to expected robust growth in this business. 3In the cable products business unit, increased demand in the main markets of Western Europe, the Middle East and the Balkans, is expected to be maintained, as both the construction and industrials sectors continue to rebound.In addition, recently signed frame contracts secure increased levels of capacity utilization over the coming years, while initiatives for further geographical diversification continue to strengthen revenue streams. By the end of 2021, the order backlog exceeded EUR 650 million. The cables segment’s operational focus remains the successful execution of existing projects and securing the award of new projects, while exploring possible new business opportunities around the globe. Further information about Hellenic Cables is available on the website: www.hellenic-cables.com

Revenue (EUR thousands)	2021	2020
	225,067	304,824

EBITDA (EUR thousands)	2021	2020
	555	21,106

a-EBITDA (EUR thousands)	2021	2020
	14,141	22,020

Steel Pipes segment

Activities

Corinth Pipeworks Pipe Industry S.A. (‘Corinth Pipeworks’) is a global supplier of high-quality steel pipes and hollow sections for the energy and construction sectors. It is a subsidiary of Cenergy Holdings, which was formed through the cross-border merger of Corinth Pipeworks and Hellenic Cables. Corinth Pipeworks has extensive experience and a strong track record of implementing complex projects for the energy sector worldwide, both onshore and offshore.

Corinth Pipeworks’ three main product categories are:

• Line pipes – manufactured either in the plant’s high frequency induction welding unit (HFW), or the helically submerged arc welding unit (HSAW) and the longitudinal submerged arc welding unit (LSAW/JCOE).
• Casing pipes – these high-frequency induction welded pipes (HFW) are used in oil and gas extraction drills; their product range was expanded by the installation of an LSAW mill in 2016.
• Hollow structural sections – used in the construction sector.

Services:

• Final site delivery;
• Storage;
• Sour service laboratory;
• Material and corrosion testing (via Corinth Pipeworks’ accredited laboratory);
• Hydrogen testing lab;
• Pipe coating;
• Ultra-tight pipe tolerances for special applications;
• Fixed lengths;
• Double jointing;
• Pipe cutting services;
• Technical consultancy and materials selection.

The Corinth Pipeworks plant has dedicated port facilities at Thisvi Port, just 1.5 km away, enabling the company to reduce raw material transportation costs, offer more competitive product pricing and facilitate faster delivery. The port includes cranes, forklifts, and other machinery, in line with the provisions of the International Ship and Port Facility Security Code.

CPW America is based in Houston, USA and aims to promote Corinth Pipeworks’ products and provide customer service to the Group’s customers, as well as to customers of other Viohalco companies located in North and South America.

Production facilities

The steel pipes segment operates the following production plant:

Plant	Production focus	Annual production capacity	Quality and management systems certifications
Corinth Pipeworks plant and port (Thisvi, Greece)	• Welded pipes for gas and liquid fuel, hydrogen transportation, and CO 2 transmission (CCS) • Hollow structural sections for the construction industry • Concrete weight coating (enabling the supply of a complete offshore pipeline package in one location)	925,000 tons	ISO 9001:2015, ISO 14001:2015, ISO 45001:2018, ISO 50001:2018, ΑPI Q1, API-5CT-0509, API-5L-0396, CPW ISO 3834-2, DNV AD 2000- Merkblatt W0 & HP0 (WZ 2537 HH 1), DNV PED 2014-68-EC (DZ 134 HH 1), DNVGL EN 10219-1 REV.5, ISO 17025:2017, ZETOM CERTIFICATE

Key financials

Amounts in EUR thousands

	2021	2020*
Revenue	225,067	304,824
Gross profit	15,157	24,695
Gross profit (%)	6.7%	8.1%
EBITDA	555	21,106
EBITDA (%)	0.2%	6.9%
a-EBITDA	14,141	22,020
a- EBITDA (%)	6.3%	7.2%
EBIT	-8,305	12,251
EBIT (%)	-3.7%	4.0%
a-EBIT	5,280	13,165
a-EBIT (%)	2.3%	4.3%
Profit/Loss (-) before tax	-15,407	1,575

• All percentages are vs Revenue
• The comparative information is restated due to retroactive application of the IFRIC Agenda Decision “Attributing Benefit to Periods of Service”.

2021 Financial performance

In the steel pipes segment, revenue decreased to EUR 225 million versus EUR 305 million in the prior year, while loss before income tax amounted to EUR 15 million (2020: profit of EUR 2 million). 2021 was a challenging year for the steel pipes segment. The energy market slowly, but steadily recovered after an unprecedented decline in energy consumption and prices due to the pandemic, which combined with the postponement or cancellation of several fossil-fuel distribution project saw energy prices climb to very high levels. A number of pipeline projects restarted in the second half of 2021, with natural gas remaining the main intermediate fuel in the global energy transition.

During this turbulent period, Corinth Pipeworks took action to mitigate the impact of these challenges. Specifically:

• Action to safeguard the health and safety of its employees, while securing uninterrupted production for all current projects.
• Strict working capital management, which secured liquidity and allowed operating activities to finance investments that took place during 2021.
• Efforts to strengthen presence in new markets, specifically Europe, the Americas, North Africa and Asia.
• The award of new projects (e.g. INGL offshore project in Israel, Gaz System in Poland, Hydrogen certified pipelines for Snam in Italy, offshore projects in the North and Norwegian sea etc).
• Continuous R&D and innovation strategy, which have positioned the company at the forefront of the energy transition and solutions on hydrogen transportation.

During the year, the company also progressed technologies to develop pipelines certified for the transfer of up to 100% hydrogen. This is the culmination of an extensive R&D programme and innovation strategy, which also includes a roadmap for the digitalization of processes, energy company qualifications and geographical diversification for competitive advantage. Corinth Pipeworks remains focused on research and development initiatives (e.g. green hydrogen transportation, CCS technologies and potential opportunities in the offshore wind sector), and the penetration of new geographical and product markets.

Finally, at the end of the year, the backlog increased reaching EUR 350 million.

Finally, on February 8, 2022, the US Department of Commerce (DoC) published the final result of its administrative proceedings on large diameter welded pipe (LDWP) from Greece, resulting in an antidumping duty rate of 41.04%. Corinth Pipeworks intends to appeal this decision, while actively working with the DoC to reverse the final determination. It is expected that the impacts of this will be minimal, as the company adheres to a geographically diversified commercial policy and the US market does not presently represent a core market.

Outlook

Corinth Pipeworks remains focused on penetrating new geographical markets and developing new innovative products, e.g. infrastructure for the offshore wind sector, tubes for hydrogen transportation, carbon capture and storage (CCS) technologies etc. Such initiatives along with intensified efforts towards stronger competitiveness will improve the company’s market position. Looking ahead, Corinth Pipeworks expects energy prices to further increase as a result of continued geopolitical uncertainty. This, in combination with its solid backlog, offers a positive outlook for Viohalco’s steel pipes segment.

Further information about Corinth Pipeworks is available on its corporate website: www.cpw.gr

Cenergy Holdings S.A.

Cenergy Holdings S.A. (‘Cenergy Holdings’) is a Belgium-based holding company which invests in industrial companies at the forefront of high growth sectors, such as energy transfer, renewables and data transmission. Cenergy Holdings’ portfolio comprises two business segments:

• Hellenic Cables, its subsidiaries and Icme Ecab constitute the Hellenic Cables companies. Collectively, the Hellenic Cables companies are among the largest cable producers in Europe. Hellenic Cables companies manufacture mainly power, telecommunication and submarine cables.
• Corinth Pipeworks is one of the world’s leading manufacturers of steel pipes and hollow sections for the energy and construction sectors.

Both entities have state-of-the-art production facilities and offer a diverse range of products to a variety of markets.

The companies in Cenergy Holdings’ portfolio:

• have a long history of implementing large-scale projects in more than 70 countries;
• have served major customers worldwide for almost 70 years;
• operate six production units and four supporting facilities in three countries; and
• provide value add products for niche markets.

Cenergy Holdings is listed on the Euronext Brussels and the Athens Stock Exchange (CENER). Further information on Cenergy Holdings is available on its corporate website: www.cenergyholdings.com

Revenue (EUR thousands)	2021	2020
	1,067,782	677,939

EBITDA (EUR thousands)	2021	2020
	160,316	29,917

a-EBITDA (EUR thousands)	2021	2020
	123,654	33,603

Steel segment

Activities

Sidenor Steel Industry S.A. (‘Sidenor Steel Industry’), Stomana Industry S.A. (‘Stomana Industry’) and their subsidiaries are leading producers of steel products and the largest steel recyclers in Southeastern Europe. The companies have more than 60 years of manufacturing experience and expertise in steel production and distribution, and an extensive product portfolio which includes long, flat, and downstream steel products.

Sidenor is the first steel company in Greece to offer customers the Environmental Product Declaration (EPD) for SD concrete-reinforcing steel products, reflecting Sidenor’s commitment to operating responsibly and to reducing its environmental footprint in Europe.# VIOHALCO | ANNUAL REPORT 2021

Steel Segment

The steel segment companies offer a broad range of value-added products and solutions for building and construction (including buildings, roadworks, metro stations, bridges, shopping malls and hydroelectric dam projects), mechanical engineering, shipbuilding, road and rail, the automotive industry, mining and tunneling applications. The product family is structured as follows:

• SD integrated reinforcing system: SD concrete reinforcing steel, SD stirrup reinforcing mesh, Sidet special mesh, SD wire mesh, Sidefor and Sidefor Plus prefabricated stirrup cages, Inomix steel bres and lattice girders;
• Wire rods for cold drawing and mesh applications;
• Special bar quality steels (SBQ);
• Steel plates;
• Merchant bars: hot-rolled square bars, hot-rolled at bars, hot-rolled round bars, hot-rolled equal angle bars and UPN channels;
• Grinding balls;
• Welding products and electrodes;
• Wire products;
• Flat wire for electric cables reinforcement;
• Tubular products: tubes of pre-galvanized steel and cold and hot rolled steel in round, square and rectangular proles.

In order to achieve the optimum balance between operational and commercial exibility and productivity, the steel segment has adopted the following operational structure:

• Mini-mills;
• Downstream operations for steel product processing;
• Sales and distribution.

Production facilities

Steel segment operates six steel manufacturing facilities:

| Plant | Production focus # Real estate

Noval Property’s main income generating properties are:

1. Retail: IKEA megastore
   96-98-100 Kissou Avenue, Egaleo, Athens, Greece
2. Retail: River West shopping centre
   96-98-100 Kissou Avenue, Egaleo, Athens, Greece
3. Office: The Orbit office complex
   115 Kissias Avenue, Athens, Greece
4. Retail: Mare West retail park
   Corinth, Greece
5. Hospitality: Wyndham Grand Athens Hotel
   Karaiskaki Square, Athens, Greece
6. Office: 33 Amarousiou Chalandriou Street office building
   Maroussi, Athens, Greece
7. Office: 16 Himaras Street office building
   Maroussi, Athens, Greece
8. Office: The Butterfly office building
   26A Apostolopoulou Street, Chalandri, Athens, Greece
9. Office: 57 Ethinikis Antistaseos Street office buildings
   Chalandri, Athens, Greece
10. Logistics: Iroon Politechneiou Street
    Magoula, Greece

Key Financials

Amounts in EUR thousands

	2021	2020*
Revenue	18,667	10,041
Gross profit	3,555	2,481
Gross profit (%)	19.0%	24.7%
EBITDA	27,921	20,409
EBITDA (%)	149.6%	203.3%
a-EBITDA	6,618	6,511
a-EBITDA (%)	35.5%	64.8%
EBIT	19,144	14,463
EBIT (%)	102.6%	144.0%
a-EBIT	-2,159	565
a-EBIT (%)	-11.6%	5.6%
Profit/Loss (-) before tax	15,347	10,511

• All percentages are vs Revenue
• The comparative information is restated due to retroactive application of the IFRIC Agenda Decision “Attributing Benefit to Periods of Service”.

2021 Financial Performance

Revenue for the real estate segment amounted to EUR 19 million in 2021 (2020: EUR 10 million), while profit before income tax amounted to a EUR 15 million (2020: EUR 11 million). It should be noted that Viohalco applies the historical cost in investment property, while the main Real Estate segment subsidiary follows the fair value model.

As at 31 December 2021, Noval Property’s diversified portfolio comprised 44 properties (one, indirectly, through a joint venture with a real estate fund), mainly in Greece and selectively in Bulgaria. The portfolio comprises offices, shopping centres, logistics centres and hospitality assets, with a total built-up area of c. 453,000 sq.m.

Noval Property recorded a 13.35% year-on-year increase in the fair value of its investment portfolio to EUR 413.29 million (as at 31 December 2021), despite difficult market conditions stemming from the Covid-19 pandemic. This growth was achieved as a result of completing specific development projects, new acquisitions and active asset management.

Covid-19 relief measures, initially introduced by the Greek Government in 2020, were extended during H1 2021. The combination of these government measures and decreased economic activity of retail businesses during lockdowns, significantly affected the income of real estate companies, including Noval Property. Despite these adverse conditions, Noval Property continued its development programme throughout the period.

Construction works to expand the River West shopping centre were completed by the end of H1 2021 and commercial operations commenced in July 2021. During H1 2021, three new assets were acquired. In H1 2021, Noval Property was also declared the preferred bidder (in a joint venture with a real estate fund, as already mentioned above) to acquire a prime plot of land in Athens where a large-scale and environmentally-friendly office complex will be developed. Acquisition of the said asset was completed in Q4 2021.

In December 2021, Noval Property successfully issued a Green Bond Loan of EUR 120 million, listed in the Category of Fixed Income Securities at the Regulated Market of the Athens Stock Exchange. Noval Property’s Green Bond was one of only three Green Bonds ever issued in the Greek capital market and is included in the recently introduced “ATHEX BONDS GREENet” section of the Athens Stock Exchange.

Outlook

Looking ahead, Noval Property will continue to actively manage its asset portfolio and the development of its captive pipeline, while exploring new acquisitions. Its focus will be on environmentally-accredited prime office buildings, logistics, data centres, resort hotels, residences, and mixed-use urban regeneration projects.

Further information is available on the Noval Property website: www.noval-property.com

R&D&I and Technology

Segment Activities

Viohalco’s dedicated research, development and innovation (‘R&D&I’) companies and in-house production plant R&D&I departments focus on:

• developing new and high value added products;
• providing efficient solutions to optimize business and industrial processes;
• improving the efficiency and environmental performance of plants;
• developing innovative applications for industry, energy and environment (including pioneering solutions in the fields of ERP, CRM, BI, traceability and others).

The segment’s activities are supported by three companies:

1. Elkeme Hellenic Research Centre for Metals S.A. (‘Elkeme’). Elkeme focuses on applied industrial research and the technological development of the four major metals sectors (aluminium, copper, steel and zinc). Elkeme provides R&D&I services and technical solutions for new products, and also optimises existing products and production processes. Elkeme is certified according to ISO 9001:2015 and operates an ISO 17025:2017 accredited analytical chemistry laboratory.
2. Teka Systems S.A. (‘Teka Systems’) delivers engineering and construction projects for the steel, aluminium, copper, power and telecommunication cables industries, commissions industrial equipment, drives process automation through the integration of technologies in projects, and implements IT projects in ERP, CRM, BI and analytics, among others.
3. Praksys S.A. (‘Praksys’) develops, markets and oversees the implementation of new technologies in structural and concrete reinforcing steel. It has developed Synthesis™, a unique system for the industrial-scale prefabrication of reinforcing steel. Praksys has also developed a complete software package to accompany the technology, including components such as product design, machine operation control, e-ordering, production planning and logistics.

The R&D&I work of the Viohalco companies’ technology departments is as follows:

• Elval Technology Centre: develops customised alloys, highly resistant special products with non-skid properties, extra flat sheets with top-quality lacquer-coatings, products made of 100% recycled aluminium and deep drawing and extrusion products.
• Symetal’s Technology Department: develops technologies that introduce and ensure innovative surface design and enhanced mechanical characteristics. These technologies allow high aluminium foil affinity control for laminates and coatings, as well as flawless forming. Symetal also focuses on the development of battery foil, which is used in the automotive rechargeable batteries industry. Symetal Battery Foil (SBF) resides at the core of Li-ion batteries, as one of its core electrodes. The technical and quality requirements for such a product are extremely high. At the same time, the reduction of rolled aluminium thickness to as low as 11 microns, allows next generation batteries to achieve a significant increase in the amount of energy stored. SBF special alloying and innovative production process is the result of extensive testing with established European rechargeable battery cells manufacturers.
• Elval Colour R&D department: in collaboration with architects and material suppliers the department develops colours through identification and experimentation to create new pigments, innovative surfaces and designs. The department also digitizes colour measurement for quality control; develops coating technologies in cooperation with equipment and coating suppliers to investigate coating processes that are more environmentally and consumer-friendly, consume less energy and contain lower or no VOCs; develops polymer compounds for faster productivity and higher fire-resistance, and explores material recyclability and material functionality. It also develops in-house and in-joint R&D projects, and new methods for the identification and analysis of material long-term performance. Elval Colour participates in numerous ongoing projects with universities relating to material performance evaluation methods, market research, and the long-term impact of coating materials on the environment. It also participates in European Technical Committees for standards’ publications and updates.
• Etem Centre: develops, simulates and homologates heat treatable aluminium alloys and relative customized extrusion, and heat treatment processes, press lines and tooling for application to automotive end use parts. Together with Global Automotive OEM and Tier1 it co-develops and homologates tailored product solutions for specific performance requirements (namely crash behaviour, weight reduction, formability, corrosion resistance, post joining process requirements). The Centre designs, develops, simulates, and homologates product-specific processes, customized machinery, tooling and quality controls across processes and in laboratories, to meet specific quality, safety, volumes and cost requirements. Through R&D efforts and collaborations, Etem has become a Tier 2 and Tier 1 supplier to the automotive industry, certified to produce aluminium profiles and parts for crash relevant systems.
• Halcor Tube Heat Transfer laboratory (located within Halcor’s Oinofyta plant): is where Talos® Inner-Groove Tubes (IGT) and Talos® ACR tubes are manufactured in line with international standards and customer specifications. IGT seamless copper tubes feature internal grooves which significantly enhance the amount of heat transfer.# VIOHALCO | ANNUAL REPORT 2021

Other activities

Other activities mainly encompass expenses incurred by the parent (holding) company, along with the results of companies which operate in the Technology and R&D&I segment, ceramic trade activities (Vitruvit) and resource recovery segment. Profit before income tax amounted to EUR 3 million (2020: loss of EUR 1 million).

Key financials

Amounts in EUR thousands

	2021	2020*
Revenue	64,134	54,909
Gross profit	23,310	19,757
Gross profit (%)	36.3%	36.0%
EBITDA	8,541	4,308
EBITDA (%)	13.3%	7.8%
a-EBITDA	9,008	3,781
a- EBITDA (%)	14.0%	6.9%
EBIT	4,307	540
EBIT (%)	6.7%	1.0%
a-EBIT	4,774	13
a-EBIT (%)	7.4%	0.0%
Profit/Loss (-) before tax	2,813	-1,114

* All percentages are vs Revenue
* The comparative information is restated due to retroactive application of the IFRIC Agenda Decision “Attributing Benefit to Periods of Service”.

F. Subsequent events

1. On January 13th, 2022, Viohalco subsidiary, ElvalHalcor, participated in the share capital increase of the joint venture NedZink BV with EUR 1.5 million, maintaining its share to 50%. In addition, on February 28, 2022, the loan balance of EUR 1.25 million was converted to share capital.
2. On February 8th, 2022, the US Department of Commerce (DoC) published its final results in the administrative proceedings conducted by the DoC for the period from April 19, 2019 through April 30, 2020 (“POR”) in connection with an antidumping (“AD”) order on large diameter welded pipe (LDWP) from Greece. As a result, the DoC determined for the POR an antidumping duty rate of 41.04% based on total adverse facts available (AFA) for mandatory respondent Corinth Pipeworks, Viohalco steel pipes segment. Despite the lengthy process of the administrative review involving the supply of extremely detailed data sets on Corinth Pipeworks’ commercial practices for the POR under scrutiny, as well as all reasonable estimations made throughout 2021 on the size, if any, of a possible AD duty rate, the DoC concluded on such a high AD duty rate. Corinth Pipeworks intends to file an appeal before the U.S. Court of International Trade against the decision of the DoC while continuing to actively work with the DoC in order to reverse the final determination. Viohalco considers that there will be no material impact on the business of its subsidiary Corinth Pipeworks, as the latter strongly follows a geographically diversified commercial policy and the USA market does not presently constitute its core market. The one-off, additional provision charge on Viohalco annual consolidated economic results from a retrospective implementation of the AD duty rate and reaches ca. EUR 12.8 million (USD 14 million plus interest).
3. The Ukraine conflict which began in February 2022 may cause increased market volatility and disruptions to many aspects of global economy during 2022. Although the impact of the crisis on Viohalco subsidiaries cannot be fully predicted, their overall exposure to Ukraine and Russia is limited and the consequences are not expected to have material impact on the business course. Sales exposure to these markets represents an insignificant portion of total turnover and any loss will be fully offset by demand in other markets. In order to mitigate potential disruption in supply chain, Viohalco companies have already initiated shifting the supply of raw materials currently sourced from Russia to alternative markets. In terms of financing, the companies have no exposure to Russian banks though they may see some impact on credit and transportation insurance. Finally, although the conflict in Ukraine has accelerated global energy crisis already experienced since the second half of 2021, Viohalco’s companies had already taken mitigating actions to reduce the business impact. Viohalco and its companies are monitoring the situation closely and will modify their approach when it is required.
4. On March 17th, 2022, Viohalco’s Board of directors decided to propose to the Ordinary General Shareholders’ meeting to be held on 31.05.2022, the approval of a gross dividend of EUR 0.10 per share. Taking into account the gross interim dividend of EUR 0.01 per share paid in June 2021, a balance gross amount of EUR 0.09 per share will be payable following approval by the shareholders’ meeting of this proposed resolution.
5. On March 17th, 2022, Viohalco’s Board of directors approved the acquisition of 25% non-controlling interest in subsidiary Bridgnorth Aluminium in consideration of GBP 11 million. As a result, Viohalco’s participation in Bridgnorth Aluminium amounts to 100%. There are no other subsequent events affecting the Consolidated Financial Information.

G. Risks and uncertainties

Viohalco’s Board of Directors is responsible for assessing the risk profile of the Company’s subsidiaries. As Viohalco is a holding company and does not have itself any production operations, customers, suppliers, or personnel (besides employees for administrative tasks), the risks affecting it are attributed to its subsidiaries and their operations, suppliers, clients and personnel. Each Viohalco company is therefore responsible for the identification, measurement, analysis, response (mitigation), control and monitoring of its own risks. To support this, a set of common guidelines for an Enterprise-wide Risk Management (‘ERM’) framework across Viohalco companies exist. These guidelines include principles for effectively managing risk across all subsidiaries. Furthermore, the framework provides guidelines on how best to address these risks and facilitates discussion on risk management issues. Viohalco’s executive management, in consultation with the Board of Directors and an independent internal audit department, is responsible for as well as assessing possible risks and their control mechanisms across subsidiaries. The objective of this evaluation is to enable the Company to determine whether the subsidiaries have managed risks in a proactive and effective way to mitigate them to acceptable levels.# Viohalco’s ERM process comprises the following steps:

a) Identify key risks and measure / analyze their potential impact and likelihood. This is done at company level as all nancial, operational, compliance and strategic risks are associated with each company’s operations.

b) Manage and respond to those risks by considering existing controls as well as selecting, prioritizing and implementing appropriate actions. This step is also done at company level, following the general principles outlined in the ERM framework.

c) Control and monitor the internal and external environment for potential changes to risks, ensuring risk control continue to be eective. Each company monitors its risks and risk responses, using the common ERM guidelines but with separate procedures, systems and mechanisms put in place by each company’s management. A consolidated review of the subsidiaries’ nancial performance, including potential risks is undertaken at Viohalco executive management level, by the internal audit department, the outcome of which is presented to the Audit Committee and the Board of Directors. The Audit Committee monitors the eectiveness of the subsidiaries’ internal control and investigates specic aspects of internal control and risk management on an on-going basis.

Key risks

Risks are classied into two main categories – ‘Financial’ and ‘Business’. Financial risks consider market risk aecting the activity of each subsidiary (such as exchange rate, interest rate and commodities risk), as well as credit, counterparty and liquidity risks. Business risks, broadly dened as all risks that are not balance-sheet related, are broken down into further sub-categories, to help better understand and react to the dierent risk events:

a) Operational and technology - the risk of loss resulting from inadequate or failed processes, people, and systems, or from external events.

b) Compliance and reputational - possible negative impacts (economic – nes, penalties, etc. and other – exclusion from markets, etc.) of non-compliance with existing regulations and standards. For example, impact on brand image, business reputation and accounting risk.

c) Strategic – those risks relating to the wider business environment (e.g. the macroeconomic environment, the sector / industry conditions, etc.) the market, competition, and medium to long-term decision making that may impact business continuity and protability.

Financial risks

Interest rate risk

It is clear that signicant movements in interest rates may expose subsidiaries to higher borrowing costs, lower investment yields and/or decreased asset values. As a central rule, entities do not enter into speculative positions on interest rates of any kind but always try to follow natural immunization strategies i.e., matching durations of assets and liabilities. However, given the current low interest rate environment, each entity tries, in the measure possible, to secure xed (and low) rate nancing lines to avoid variations in cash ows and facilitate capital budgeting. If necessary, subsidiaries use derivatives to hedge any remaining interest rate risk, strict rules and limits, specic to each entity, regulate the use of such instruments.

Currency risk

Viohalco holds stakes in a large number of companies with production plans and commercial relations spanning the globe. As such, they are exposed to nancial (transaction), accounting (translation) and economic potential losses due to volatility in foreign exchange rates. Companies manage this risk in a prudent manner, implementing natural hedges whenever possible (i.e. matching currencies in anticipated sales and purchases, receivables and liabilities) and using standard hedging products, such as forward contracts, if necessary.

Commodity risk

Most Viohalco entities are industrial companies, using ferrous and non-ferrous raw materials as inputs. Fluctuations in commodity prices (especially metals and particularly copper, zinc and aluminium) may therefore expose them to lower product margins or trading losses. Future contracts traded in the London Metal Exchange (‘LME’) oer the obvious hedging choice for companies active in such metals. First, all metal price xing sales and purchase contracts are netted daily and the change in the net open commodity is generally hedged by LME future contracts so that Viohalco companies are not exposed to commodity price risk. Additionally, Viohalco subsidiaries may be aected from uctuations in energy prices. This risk is impacted by the on going CoviD-19 pandemic and the war in Ukraine. Monitoring of price indexes and forecasts, along with hedging mechanisms for longer term contracts, are utilized to protect companies from signicant uctuations in natural gas and electricity prices.

Liquidity risk

For industrial companies, such as those forming the largest part of Viohalco’s holding portfolio, liquidity risk is the risk that a business will have insufficient funds to meet its nancial commitments in a timely manner. Its two key elements are short-term cash ow risk and long-term funding risk. The latter includes the risk that loans may not be available when the business requires them or that such funds will not be available for the required term or at acceptable cost. Such risk may come from seasonal uctuations, business disruptions, unplanned capital expenditure, an increase in operational costs, a narrow funding market and other reasons causing inadequate cash availability. Viohalco companies constantly monitor cash ow needs and, on a quarterly basis, report monthly rolling forecasts to ensure sucient cash is on hand to meet its operating needs. Through monthly nancial reports, they closely track operating cash ow indicators, liquidity and leverage ratios and continuously assess available funding, both in the local and international markets. Finally, the Viohalco companies mitigate liquidity risk through careful cash ow management including optimizing working capital and maintaining unused, committed nancing facilities from a diversied number of nancial institutions. These allow their business to easily meet its future requirements or contingencies.

Credit risk

Selling to a large number of customers spanning vast geographical regions and many sectors across the world, unavoidably creates a credit risk for Viohalco companies as their customers may default on their obligations. Such credit risk may be accentuated if a signicant portion of business is concentrated on a specic area, sector, or small number of clients. This risk is greatly mitigated by (a) avoiding receivables concentration of any kind, (b) executing robust creditworthiness checks for customers via credit rating agents, (c) setting relevant payment terms and credit limits, (d) demanding real or other security (e.g. letters of guarantee) for receivables whenever possible, and, nally, (e) using credit insurance extensively.

Business risks

A. Operational and technology risks

Channel effectiveness risk

Poorly performing or positioned distribution channels may threaten the subsidiaries’ ability to eectively and eciently access current and potential customers and end users. Subsidiaries manage channel eectiveness risk by appointing commercial executives per project/market. Periodic budget reviews are the main tools used for assessing and monitoring the eectiveness of distribution channel.

Procurement / Sourcing risk

Limited sources of energy, metals and other key commodities, raw materials and component parts may threaten Viohalco companies’ ability to produce quality products at competitive prices on a timely basis. As such, all companies continuously aim to minimize the likelihood of such a risk occurring. Relevant measures include maintaining a wide and diverse suppliers base (geographically diversied, where possible), the existence of alternative material lists, the establishment of Service Level Agreements with key vendors and the reduction of reliance to the spot market through long term contracts.

Operation interruption risk

The unavailability of raw materials, skilled labor, information technologies, or other resources and the danger of equipment breakdowns may threaten Viohalco companies’ capacity to continue operations. This being critical for industrial production, all subsidiaries diligently maintain their equipment, following well planned maintenance schedules formulated by their specialized maintenance departments. Plant equipment and production lines are also upgraded systematically to integrate new technologies and reduce obsolescence risk. All spare parts and consumables are gauged on criticality and safety stock levels are monitored. Some plants, facilities and production lines are interchangeable and have been mapped to ensure shifting and continuation of production if such a need arises. This risk is greatly mitigated by using business interruption insurance policies.

Product failure risk

Faulty or non-performing products may expose Viohalco companies to customer complaints, warranty claims, eld repairs, returns, product liability claims, litigation and loss of revenues, market share and business reputation damage. In order to proactively mitigate the risk arising from actual or claimed defects in its products, companies have established rigorous quality management systems at their plants. They apply xed and formalized quality control procedures, while maintaining appropriate insurance coverage against such claims. Quality control procedures include sample testing per production batch or at item level at specic phases of production, establishment of monitoring equipment at set production phases and production lines and work centers to capture defects, and the implementation of end-to-end traceability systems, among others. In addition, companies have product liability insurance policies in place.# Information Technology (IT) Risk

IT risk is usually defined as the likelihood of occurrence of a particular threat (accidentally triggered or by intentionally exploiting a vulnerability) and the resulting impact of such an occurrence on IT systems and processes. Most Viohalco companies are capital intensive and rely heavily on IT systems to guide and optimize production. IT systems bear a number of risks that arise naturally in the production environment, and thus the commercial environment overall, and may result in losses or legal liability. Such risks can revolve around disruptions due to IT equipment failure, disasters, human errors as well as unauthorized use, disclosure, modification, destruction of information, among others. Adequately identifying gaps that may result in risks, assessing the maturity of the existing controls, and identifying and implementing risk mitigation actions is an ongoing process that must consider evolving threats, controls, and the regulatory landscape. The continuous identification and application of appropriate and proportional controls that limit exposure against the aforementioned threats is vital to the integrity of IT systems in all companies and are legal requirements. Viohalco is conducting risk assessments and gap analyses against operational IT and information security risks in order to evaluate and continuously ameliorate its overall IT risk posture, as well as to comply with 2016/679 EU General Data Protection Regulation (‘GDPR’). As well as using industry standards for data and systems protection, companies request the services of Teka Systems, a subsidiary of Viohalco, focused on the implementation, customization and support of information systems. Teka is the official competence center of Viohalco and offers tailor-made applications and software support to Viohalco’s industrial companies as necessary.

Privacy Risk

Viohalco recognizes the need to protect personal data, not only as a legal compliance requirement vs the 2016/679 EU General Data Protection Regulation and other standing legislation, but also for the added value and competitive advantage it offers. The company is committed to protecting the personal data of employees, customers, suppliers, partners and investors. The aim is to adhere to the international standards and best practices and thus minimize risk against the privacy of individuals and their personal data. To that end, Viohalco adopted and implemented a Personal Data Protection Policy, set specific roles, procedures and controls for the protection of personal data throughout the activities spectrum of its subsidiaries, along with the establishment of overviewing mechanisms on risk mitigation actions and their continuous improvement.

Compliance and Reputational Risks

In response to requirements arising from Viohalco’s stock exchange listings, the Company has established the necessary structures and procedures to ensure continuous compliance and protect its reputation. This includes the adoption of its Corporate Governance Charter, which covers issues such as directors’ and managers’ accountability, good governance principles, insider trading, and conflicts of interest. Laws and regulations apply to many aspects of subsidiaries’ operations including, but not limited to, labor laws, health and safety, environmental regulations, and building and operational permits, among others. Viohalco requires all companies in its holding portfolio to abide by all laws and regulations, whether at a local, European or international level. These may relate to health and safety in the production plants, labor and human rights, the protection of the environment, anti-corruption, bribery and financial fraud. Viohalco requires its subsidiaries to develop their own policies for all such matters and to be exclusively responsible for compliance with these. Additional details are given in the Non-Financial Information Report section of this Report.

Strategic Risks

Country Risk

Adverse political actions may threaten subsidiaries’ resources and future cash flows in a country in which each subsidiary has invested, is dependent on for a significant volume of business or has entered into a significant agreement with a counterparty subject to the laws of that country. Companies address this risk by differentiating their manufacturing and market reach. Viohalco companies currently have manufacturing sites in eight countries, a commercial network in 21 countries and products distributed in more than 100 countries worldwide. VIOHALCO | ANNUAL REPORT 2021 71 They also monitor the developments in the international and domestic environment on a continuous basis and adapt business strategy and risk management policies in a timely fashion to minimize the impact of macroeconomic conditions on their operations.

Industry Risk

Changes in opportunities and threats, competitors’ capabilities, and other conditions affecting the subsidiaries’ industries may threaten the attractiveness or long-term viability of these industries. Industry risk of the subsidiaries, which is related to the specific industry in which they operate, is primarily associated with the cyclicality of demand and the substitution rate of some products. Companies manage the former by expanding exports to global markets, to disperse cyclical exposure across geographical areas. The risk of substitution is addressed through differentiation of the product mix, for example by shifting a portion of production to products where the substitution rate is lower.

Competitor Risk

The actions of competitors or new entrants to the market may impair any company’s competitive advantage or even threaten its ability to survive. Hence, strategic issues regarding response to competition are assessed as part of the annual budget process and strategic plan of all Viohalco companies. Exposure to competitor risk is captured through a daily review of market information. Relevant mitigating actions include a strong commitment to quality throughout the production phase, a competitive pricing policy in commodity products and a targeting of high-margin products.

Technological Innovation Risk

As technology rapidly evolves, companies in Viohalco’s holding portfolio must ensure adequate innovation and investment to remain up to date. If they do not invest in the IT infrastructure necessary to effectively support current and future business requirements, this could affect sales, costs and revenues. In addition, companies may not successfully leverage advancements in technology to achieve or sustain competitive advantage or may be exposed to the actions of competitors or substitutes that do leverage technology to attain superior quality, cost and/or time performance in their products, services and processes. This strategic risk is primarily managed by Viohalco companies through the establishment of technical assistance and knowledge transfer agreements with global leaders in various sectors where the subsidiaries are active. All companies invest strongly in R&D and cooperate with scientific bodies and prominent international research centres. This strong focus on technology and innovation is also demonstrated through dedicated R&D departments at a number of Viohalco companies.

1. The set of perceptions about the company by the different stakeholders with whom it interacts, both internal and external.
2. The risk which concerns the proper and true economic and financial reflection of the companies’ reality as well as compliance with all related regulations (IFRS, etc.).

72 H. Non-financial information 73 VIOHALCO | ANNUAL REPORT 2021 74

Introduction

This document represents the Consolidated Disclosure of Non- Financial Information (hereinafter also the “Non-Financial Disclosure”, "NFD", "Statement” or "Sustainability Report") prepared pursuant to the Belgian Code of Companies and Associations (Legislative Decree no. 83180/11.09.2017) by Viohalco S.A. (‘’Viohalco’’, ‘’the Company’’) for financial year 2021. The objective of this NFD is to provide the understanding of the business model, the activities, the main risks, and performance indicators of Viohalco with regard to the following non-financial matters, also referred to as environmental, social and governance (ESG) matters:

• Environmental
• Social and labour
• Human rights
• Anti-corruption and bribery.

The NFD comprises of non-financial information for Viohalco and its subsidiaries that have a material contribution in the non-financial matters under scope. The subsidiaries contributing in a material way come from all major operating segments except the real estate and R&D&I segments which due to their relative size, are not considered to contribute in a material way to the overall impact. The NFD has been drawn up in accordance with the United Nations’s Sustainable Development Goals (SDGs) reporting framework which embrace a very wide and universal approach to all sustainability issues facing today’s societies. The SDGs are a list of 17 interconnected global goals, designed to be a "blueprint to achieve a better and more sustainable future for all", that address current challenges societies all over the globe are facing. The 17 goals have 169 underlying, more specific targets that stimulate action in areas of concern. While Viohalco companies have a direct or indirect impact on all 17 SDGs, the NFD focuses on the SDGs directly impacted by the activities of the Company and its subsidiaries. The SDGs reporting framework serves as the basis for the reporting structure of non-financial matters of the Company as it contains several non-financial key performance indicators (KPIs) for the monitoring of all main risks associated with the non-financial matters under scope in the Belgian Code of Companies and Associations.# VIOHALCO | ANNUAL REPORT 2021

Due to the extensive number of KPIs selected to monitor Viohalco’s and its subsidiaries’ performance, the report is also based on the GRI Standards of the Global Reporting Initiative (GRI) for reasons of completion.

■ Highlights 2021

	Value
Expenditures for environmental management (in EUR)	30,567,315
Number of training hours	100,886
Manufacturing sites certified with ISO 14001:2015	89%
Manufacturing sites certified with ISO 45001:2018	86%

■ Business Model

Viohalco is a Belgium-based (listed on Euronext Brussels Exchange (VIO) and on the Athens Stock Exchange) holding company of leading metal processing companies in Europe. Uniquely diversified in metal sector activities and with an international presence, Viohalco companies are committed to sustainable manufacturing of high-quality, innovative and low carbon products and solutions with a wide portfolio and presence in dynamic markets such as building and construction, packaging, transportation (automotive, shipbuilding & rail), energy networks (offshore energy, utilities and power grids, renewable energy, gas and liquid fuels), HVAC&R (heating, ventilation, air conditioning and refrigeration), water supply, telecommunications, printing, and various industrial applications. Viohalco’s portfolio also includes a segment dedicated to technology, innovation and R&D, comprising companies focused on product innovation, industrial research and technological development, engineering applications, ERP application services. Viohalco is also active in the real estate sector, through a Real Estate Investment Company (REIC) that creates value through commercial exploitation of its diversified and high-quality portfolio spanning offices, shopping centres, hotels and logistics.

Viohalco companies’ production model is based on secondary production and downstream processing of metals. This operational model is increasingly important in the value chain of metals for a climate neutral future as it increases demand for recycling of metals while at the same time reduces the carbon footprint and is therefore very well positioned for the new challenges today’s societies face, namely the transition to a low carbon economy adhering to circular economy principles.

75

• Steel pipes
• Steel R&D&I and Technology
• Real estate
• Viohalco segments
• Cables
• ElvalHalcor
• Halcor - Copper and alloys extrusion division
• Sidenor Steel Industry
• Elkeme
• Noval Property
• Teka Systems
• Praksys
• Sovel
• Dojran Steel
• Stomana Industry
• Corinth Pipeworks
• CPW America
• Hellenic Cables
• Fulgor
• Icme Ecab
• Sofia Med
• Bridgnorth Aluminium
• Etem Bulgaria
• Steelmet Property Services
• ElvalHalcor
• Elval - Aluminium rolling division
• Symetal
• Elval Colour
• Aluminium
• Copper
• Cenergy Holdings
• ElvalHalcor
• Cablel Wires
• Epirus Metalworks

More precisely, Viohalco operates under the following organizational structure, comprising 7 business segments.

“2021 was a milestone year for Viohalco companies as a comprehensive plan and roadmap was created to address all environmental, social and governance risks through extensive indicators to measure our progress. Furthermore, the subsidiaries focused on increasing the share of secondary metals in the raw material input, as well as reduce operational carbon footprint to help their customers reach their own sustainability goals.”
Ioannis Ippokratis Stassinopoulos
Viohalco CEO

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A thorough description of each business segment activity is provided on pages 16-65. Several of Viohalco’s subsidiaries play an active and important role to the energy transition as well as the global transformation to a climate neutral future. The segment of cables is a significant enabler of the energy transition and the European Green Deal with over 38% of its revenues coming from activity eligible under the Taxonomy Regulation to be considered as environmentally sustainable because of the significance of power cables in the expansion of Renewable Energy Sources (RES) in the energy mix and the gradual decarbonization of the global economy. The segment of steel pipes (Corinth Pipeworks) is also well positioned to contribute significantly in the energy transition away from solid fossil fuels with approximately 95% of its revenues coming from natural gas projects while at the same time, Corinth Pipeworks has developed solutions that can adapt to emerging technologies such as Green Hydrogen and Carbon Capture and Storage (CCS). The company, although not included in the eligible sectors of the Taxonomy Regulation, will play a significant role in the penetration of low carbon fuels that can replace natural gas in the future. In particular, the segments of aluminium, copper and steel have a significant contribution of secondary raw materials in their total raw materials input which significantly reduces the carbon footprint of their products as well as the dependence on natural resources. Consequently, due to their relatively low carbon intensity, Viohalco companies have less exposure to carbon pricing going forward and have significantly lower cost risk exposure than primary metal producers. Indicatively, the benefits of secondary production of metals are outlined below:

• Aluminium
  • By using aluminium scrap, CO₂ emissions can be reduced by 92% compared to primary aluminium.
  • Recycling aluminium saves 95% of the energy needed for primary production.
  • One tonne of recycled aluminium saves up to 8 tonnes of bauxite, 14,000 kWh of energy, and 7.6 cubic meters of land.
• Copper
  • By using copper scrap, a reduction by 65% in CO₂ emissions is achieved
  • Recycling copper saves 85% of the energy needed for primary production
• Aluminium
  • ElvalHalcor
  • Elval - Aluminium rolling division
  • Elval Colour
  • Etem
  • Bridgnorth Aluminium
  • Etem Bulgaria
• Copper
  • ElvalHalcor
  • Halcor - Copper and alloys extrusion division
  • Sofia Med
  • Cablel Wires
  • Epirus Metalworks
• Steel pipes
  • CPW America
  • Corinth Pipeworks
• Cables
  • Fulgor
  • Hellenic Cables
  • Icme Ecab
• Steel
  • Sovel
  • Sidenor Steel Industry
  • Stomana Industry
  • Dojran Steel
• R&D&I and Technology
  • Elkeme
  • Praksys
  • Teka Systems
• Real estate
  • Noval Property
  • Steelmet Property Services
• Symetal

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• Steel
  • Using steel scrap in the production process reduces CO₂ emissions by 58%.
  • Recycling steel saves 72% of the energy needed for primary production (i.e., 4,697 kWh per tonne).
  • Recycling one tonne of steel saves 1.4 tonnes of iron ore, 0.8 tonnes of coal, 0.3 tonnes of limestone and additives, and 1.67 tonnes of CO₂.
  • Using recycled steel to make new steel reduces air pollution by 86%, water use by 40%, and water pollution by 76%.

The ambitions of the European Green Deal can only be achieved with an increased contribution of sustainable metals’ production. It is estimated that a climate neutral future will demand 3-4 times more metals and many of Viohalco’s subsidiaries’ products will have further demand. Steel construction products will be critical in the ‘green building’ sector, with their low carbon content and high circularity profile, while aluminium is vital for lightweight mobility, sustainable packaging and energy efficient facades in sustainable buildings. At the end of their useful lifetimes, the majority of Viohalco products across all segments are 100% recyclable and will return to the value chain indefinitely. Products made from steel, aluminium and copper can be completely recycled as often as desired and reintroduced into the economic cycle with virtually no waste or loss of quality. In addition, the production of Viohalco’s production installations meet European high standards for environmental and climate protection that far exceed global average standards.

Integration of sustainability principles in business model

Due to the nature of the industrial processes of the subsidiaries as well as the products’ markets, Viohalco companies’ future has a strong correlation on the ability to operate in a sustainable manner. The subsidiaries are in the process of developing additional goals towards carbon footprint improvement as well as energy efficiency measures while at the same time becoming more engaged with their suppliers in order to ensure responsible sourcing of raw materials and services. Furthermore, two subsidiaries, Hellenic Cables and Corinth Pipeworks, have already committed to the Science Based Targets Initiative (SBTi) to meet near-term (2030) and long-term net zero targets at the latest by 2050. More specifically, Hellenic Cables has already submitted its targets pending validation from SBTi, to halve its scope 1 and 2 emissions (50% by 2030 from a 2020 base year) and reduce value chain emissions (scope 3, including raw materials and commuting emissions) by 25%, within the same timeframe. Hellenic Cables also commits to increase annual sourcing of renewable electricity to 80% and 100%, by 2025 and 2030, respectively. Over and above near-term progress, Hellenic Cables projects to reach net-zero greenhouse emissions across its entire value chain before 2050, from a 2020 base year. Corinth Pipeworks submitted its commitment in February 2022 and is awaiting for its approval from SBTi.

Viohalco companies are well positioned not only to operate in a low carbon economy, but to increase market share as the operational model allows for the flexibility to operate with various quality metal sources, primary or secondary metals of various qualities. Most Viohalco companies are electricity intensive and the projected decarbonization of the energy grid will naturally improve and further decrease the indirect carbon footprint of the products contributing to Europe’ ambitious goals of a decarbonized economy. Viohalco companies are oriented towards a sustainable manner of operation with respect to all its stakeholders. Sustainable action and long-term corporate procedures have played a significant role in achieving and strengthening the resiliency of Viohalco companies under challenging market conditions and changing customer demands.# Viohalco companies acknowledge their duty towards current and future generations of employees, customers and other stakeholders. Viohalco companies comply with the Paris Agreement requirements by operating modern industrial plants with strong environmental foundations while at the same time manufacturing products that will play a significant role in making a climate neutral future a reality. The sustainable path Viohalco companies have chosen to follow does not come without a demand for actions. Based on what has been achieved so far, Viohalco companies are still facing numerous operational, non-financial risks that require constant monitoring and mitigation while the continuously changing and more demanding regulatory framework, especially due to the upcoming “Fit-for-55” Initiative, often create conditions of unfair competition with global competitors. Furthermore, the current environment with energy prices as well as energy security is of great concern and needs constant measures to ascertain business continuity. The greater risks emanate from the environmental regulatory environment and health and safety matters where several improvement areas have been identified and ambitious goals have been set.

ESG Roadmap

The year 2021 was a very important year for Viohalco companies in the context of sustainability. The Company created a comprehensive framework within which all subsidiaries are required to operate. The Company established an Environment, Social and Governance Roadmap (“ESG Roadmap”) by assessing all related risks and opportunities and integrating all these matters into its business strategy. The integration considered several new parameters affecting its approach such as the European Green Deal and its requirements, the strict regulatory framework the subsidiaries operate under (especially in environmental compliance and labour laws), the emergency created by climate change and its effects, water availability, health and safety concerns, capability building, as well as the recent challenges in the energy sector affecting all of our companies. The ESG Roadmap refers to the adoption of seven (7) core company policies covering the entire framework of all environmental, social and governance matters. Each policy is thoroughly monitored by relative metrics, internal and external controls for adequate due diligence on important matters and regulatory compliance as well as appropriate governance measures to ensure transparency and accountability. Furthermore, the ESG Roadmap includes the obligation of the industrial subsidiaries to establish goals in strategic matters that include: (1) the gradual replacement of all electricity supply with Renewable Energy Sources (RES) as soon as technically and economically feasible; (2) the commitment to specific near and long-term carbon reduction targets on all carbon-intensive activities; (3) the evaluation of top tier suppliers on ESG issues; and (4) the establishment of a five-year concrete, improvement action plan for health and safety for industrial companies. The first two strategic goals are part of Viohalco companies’ operational model as these two elements are essential for the production of low carbon products.

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Regarding the supply chain, it is important to note that Viohalco’s subsidiaries operate at international level with global production supply chains. Given the different environmental, human rights as well as labour standards across the globe, it is Viohalco companies’ intent to embrace a common standard of ethical values and legal requirements within the supply chain. Viohalco companies are committed to ensuring that all employees return home safely every day. This is why it is of strategic importance to provide a safe working environment and invest in a continuous improvement programmes. During 2021, Viohalco companies, with the assistance of a globally leading consulting firm in health and safety (DuPont Sustainable Solutions), performed a health check of existing management systems and improved safety programmes through workshops, safety leadership training, etc. to improve health and safety performance. The ESG Roadmap includes other areas of focus such as:

• environmental performance with water, waste, and chemicals management at the forefront;
• gender equality;
• working conditions;
• labour and human rights;
• business ethics;
• the establishment of a whistleblower mechanism.

Sustainability Governance

Viohalco’s sustainability strategy cannot be realized without the proper governance structures related to ESG matters in place at Board level and across the various subsidiaries. This is an essential ingredient in order to translate the ambitions and goals into actions. Viohalco’s Board has validated the ESG Roadmap including the following key pillars: establishment of policies and relevant KPIs, goal setting in material issues, establishment of appropriate due diligence mechanism, implementation of ESG in supply chain and oversight of ESG strategy, risks, and issues at Board level. The ESG Roadmap was further adopted at Board level by most of the subsidiaries. An ESG Working Group has been set up in order to support and advise the Board on ESG matters, and hence provide the assurance that such issues are adequately addressed. An executive management working group within Steelmet comprising of managers from all cross-referencing departments meet on a regular basis to discuss progress of the implementation of the ESG Roadmap, as well as new ESG initiatives. As stated in the “Control and Relationship with Subsidiaries” section of the Financial report on page 100, Steelmet is a Viohalco subsidiary assigned by a subcontracting agreement with the functional support towards all companies of Viohalco. To ensure compliance and accountability with the ESG Roadmap by the Viohalco subsidiaries, a compensation scheme for subsidiaries’ General Managers linked with performance on ESG matters is planned for implementation in calendar year 2022. In addition, an ESG coordinator at each subsidiary level was assigned the role of coordinating the various functions, facilitating relevant ESG actions at subsidiary level and reporting progress on a semi-annual basis. Essential role in our corporate governance structure is the implementation of a whistleblower mechanism which covers all the subsidiaries in all geographical regions Viohalco companies operate. The mechanism, which will be implemented in 2022, establishes the proper channels of communication for anyone either within or outside Viohalco and its subsidiaries, to report unethical or illegal wrongdoing, while at the same time ensuring comprehensive protection and support for reporting persons. All of the above structures were created to ensure that our organic growth and economic success do not come at the expense of fair competition, safe working conditions or environmental protection.

Policy framework

Viohalco as a holding company of a predominantly industrial portfolio believes that its companies must demonstrate the same responsibility and share the same values and commitment in sustainability matters in order to preserve long-term value for its shareholders. Viohalco companies are committed to operating safely in an environmentally and socially responsible manner and to partnering with their customers and community stakeholders to shape a more sustainable future for all parties involved. Viohalco companies aim to establish a relationship of responsibility and trust with its counterparties and to meet expectations by keeping faith with commitments undertaken. The responsible operation of the companies is considered a primary goal and is fundamental for their sustainable operation. During 2021 Viohalco adopted seven policies that cover the entire spectrum of environmental, social and governance matters. These policies cover the following areas:

1. Environment
2. Energy and Climate Change
3. Health and Safety
4. Labour and Human Rights
5. Supplier Code of Conduct
6. Business Ethics and Anti-corruption
7. Sustainability

These policies can be found at https://www.viohalco.com/845/en/Policies/

Viohalco’s core values are reflected in its policies that its companies should follow, at a minimum, regarding sustainability matters. The companies in turn have developed their own respective, detailed policies adhering to Viohalco’s policy principles at a minimum.

Environment

Viohalco companies are committed to operate with responsibility and respect for the environment and the society. Sound environmental management of all production and storage installations is one of the most important focus areas and is essential to the sustainability of the companies’ s activities. Companies shall operate in full compliance with applicable national and EU environmental legislation, as well as with the specific environmental operational terms of each plant, always in a state of transparency and participation in an open dialogue on environmental matters with all the stakeholders.

Energy and Climate Change

Viohalco companies are committed to being a significant contributor to the global effort to tackle climate change. As consumers of both non-renewable and renewable energy, Viohalco companies are committed to buying and using energy in a responsible, efficient, and cost-effective manner with the aim to reduce the carbon footprint.

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Health and Safety

Viohalco companies are committed to continually promote health and safety for their employees as well as for their partners, including customers, suppliers, contractors, and visitors. All the companies shall strictly comply with all applicable legislation and fully implement all suitable standards, instructions and procedures regarding health and safety.# Labour and human rights

Viohalco companies do not accept any discrimination of race, gender, religion, age, nationality, social or ethnic origin, disability, belief, sexual orientation, or political and trade union engagement. These principles apply to the recruitment of new employees, to employees with an employment contract and to the professional merit-based promotion of employees. The only decisive factors of employment are performance, experience, efficiency, skills, and qualifications. Viohalco and its companies do not accept any form of forced labour. All work performed in the companies must be voluntary. The employment of individuals under the applicable statutory minimum age for workers is prohibited. Viohalco and its companies recognise the right of all employees and stakeholders to work with dignity and believe that everyone in the companies is responsible for having due regard for human rights. Viohalco and its companies support and respect the fundamental principles, as articulated in the Universal Declaration of Human Rights as well as the protection of international human rights within the sphere of their influence and will not be complicit in human rights abuses. The Companies’ policies and procedures adhere to all applicable domestic laws concerning freedom of association and collective bargaining, non-discrimination, forced labour and underage workers in the workplace.

Supplier Code of Conduct

The Supplier Code of Conduct has the goal of ensuring that Viohalco companies business partners share and promote Viohalco companies’ fundamental values in ethics and sustainability principles. Viohalco companies require their business partners to comply with all the principles in the Supplier Code of Conduct and will correspondingly promote these principles within their own supply chain.

Business ethics and anti-corruption

Viohalco and its companies are committed to conducting its business with honesty and integrity and in compliance with all relevant laws. Viohalco and its companies ensure transparency in all interactions and acknowledges that it has a moral and legal obligation to act responsibly in all jurisdictions. Viohalco and its companies have put internal controls in place to ensure that illegal and unethical business activity does not occur. The performance and competitiveness are strengthened solely through lawful conduct. Viohalco and its companies have internal controls to ensure all kinds of bribery and corruption do not occur.

Sustainability

Viohalco, as a holding company, is committed through its subsidiaries’ activities to meet the needs of society by delivering, through its subsidiaries, products in a reliable, inclusive, and sustainable manner, and in doing so, creating shared value for all stakeholders. Viohalco companies commit to operate in a way that creates progress towards the UN Sustainable Development Goals. Through this commitment, Viohalco companies seek to help preserve the environmental, social, and economic assets that are fundamental for society and important to our long-term value creation. Viohalco companies build on the contribution of their employees and fully integrate sustainability in their strategy, business plans, operations, aiming to maximise its positive effect by engaging with all business partners.

Operational Due Diligence

The compliance of subsidiaries’ policies incorporating Viohalco’s policies’ principles is ensured by an extensive due diligence programme performed by Steelmet, which is responsible, for the monitoring of Viohalco companies’ performance including non-financial matters. Steelmet employs proficient auditors in their respective field of expertise who perform periodic reviews and assessments of the subsidiaries. During their periodic business reviews, the top management of Viohalco companies reports to Steelmet on performance metrics, where applicable, and analyses risks and challenges as well as corrective actions that are deemed necessary. The progress of corrective actions as well as any non-compliance matters are addressed, and the subsidiaries are required to commit to a verifiable course of action within a specific timeframe. Steelmet reports on a regular basis to Viohalco’s Audit Committee identifying potential risks on these matters.

In addition, due diligence in the matters of environment, energy management and health and safety is also performed by external auditors during periodic management system certification reviews. The entirety (100%) of Viohalco production companies under the scope of this report are certified with the Environmental Management System ISO 14001:2015 and the Occupational Health and Safety Management System ISO 45001:2018. When accounting for all production installations including those outside the scope of this report, 89% are certified with the environmental Management System ISO 14001:2015, and 86% with the Occupational Health and Safety Management System ISO 45001:2018. Considering that health and safety (H&S) matters are of strategic importance to Viohalco’s subsidiaries, further evaluations and health checks of the H&S programmes are performed by a third party (DuPont Sustainable Solutions) on a periodic basis to ensure a transparent and objective assessment. The above stated management systems lays out responsibility areas and operational practices for these task areas across all companies’ operations while at the same time create a regular monitoring of compliance with internal and external audits. To ensure that all subsidiaries are following a continuous improvement path, Steelmet professionals have close cooperation with subsidiaries’ top management and pertinent personnel to draw continuous improvement plans with specific, prioritized, improvement actions as well as benchmarks that need to be achieved within certain time frameworks.

Materiality analysis and performance outcome

Viohalco is a holding company with a majority stake in multiple industrial companies of various sizes as described on page 3. Hence the scope of this report focuses on the legal entities with the most significant impact and potential risks on non-financial issues. These VIOHALCO | ANNUAL REPORT 2021 80 companies are the largest production facilities in terms of revenue and personnel employed which have a direct correlation to environmental, social and governance issues. The selection has been made based on their comparatively large labour force, demand in natural resources such as water and raw materials, large energy intensity and carbon footprint, extensive business impact and therefore the largest and material overall impact in terms of non-financial matters under the scope of this report. The two quantitative criteria that these companies meet are: a) a minimum 3% contribution to the Viohalco total consolidated revenue, and b) minimum 200 employees. The outcome of this selection is the following eleven companies:

1. ElvalHalcor (aluminium and copper segment)
2. Bridgnorth (aluminium segment)
3. Symetal (aluminium segment)
4. Sofia Med (copper segment)
5. Hellenic Cables (cables segment)
6. Fulgor (cables segment)
7. Icme Ecab (cables segment)
8. CPW (steel pipes segment)
9. Sidenor (steel segment)
10. Sovel (steel segment)
11. Stomana Industry (steel segment)

The above list includes companies from all Viohalco’s industrial segments. The non-financial information for the above-mentioned companies are consolidated and presented on a per-segment basis as the companies within the same segment have similar non-financial issues and risks. Indicatively, the above companies include approximately 91% of revenue before consolidation and 72% of Viohalco companies’ total employees. The Real Estate and R&D&I segments do not meet the two criteria due to the nature of their activities which have significantly lower impact on environmental, social and governance issues under scope of the Belgian Code of Companies and Associations. They are more service-oriented, unlike the industrial companies with a much higher footprint in environmental and social issues. Due to the various geographic locations of each company and the varying degree of material environmental matters each company may be facing (carbon and water risks vary among subsidiaries depending on geographic location), it was deemed necessary that a separate materiality analysis is performed for each company. The selection of the material issues reported in the present report was based on an extensive materiality analysis performed separately by each company. The materiality analysis in each subsidiary was performed according to the GRI Standards within the last two years and a new materiality analysis will be performed within 2022 due to the rapidly changing business environment. The stakeholders considered in the materiality analysis were employees, customers, business partners, academic institutions, governments, local communities, local government, shareholders, financial institutions, and suppliers. Several issues are included and assessed in the materiality analysis, such as environmental issues, employee issues, working conditions, compensation, products, social issues, business ethics, etc. The identified topics form the basis of this report. Based on these materiality analyses from each company, the major and more commonly found matters and associated non-financial risks were selected due to their potential to negatively impact the companies’ business relations, products, and long-term sustainable operation. The non-financial issues identified in the materiality analysis phase of the companies and corresponding risks were then correlated to non-financial metrics from the SDGs’ reporting framework, where available. Furthermore, GRI Standards were selected to supplement SDG metrics to cover the entire spectrum of metrics for each material matter to assess the performance and risk exposure.# Viohalco | ANNUAL REPORT 2021

ESG Issues and Risks of Concern

Viohalco, as previously stated, has identified the major and more commonly found areas of material impact that have been selected by the individual companies’ materiality analysis as well as stakeholder assessment, and the main ESG issues and risks of concern are those listed in the table below.

Issue identified	Relevant Viohalco subsidiaries’ risk area of material in materiality analysis category	SDG impact
Water availability and wastewater management	Environmental protection and responsible production (waste management, circular economy)	Environment
Energy efficiency, sources of energy	Environment	Environment
Climate change impact	Environment	Environment
Environmental protection and responsible production (waste management, circular economy)	Environment	Environment
Occupational Health and Safety	Social	Social
Labour and human rights	Social	Social
Responsible sourcing	Social	Social
Transparency and anti-corruption	Governance	Governance

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Environmental Responsibility

Water availability and wastewater management (SDG 6)

Water is an essential element of Viohalco companies’ production process and therefore its responsible use is critical for the companies’ business continuity. Responsible use of water includes:

• the reduction of water intensity utilizing water conservation technologies where possible, the continuous monitoring of consumption so leaks can be detected on time and the preventive maintenance of water networks to avoid water losses;
• carefully assessing water availability and the adoption of measures, when needed, for adequate alternatives of supply in times of water shortage;
• proper maintenance and operation of wastewater treatment plants to have full compliance with water discharge limits.

The availability of industrial water is of critical importance and the majority of the plants have a programme of water consumption monitoring in order to improve their water intensity. There are continued efforts to decrease water consumption as part of the companies’ long-term improvement of their environmental footprint.

The aluminium and copper segments experienced an increase in total water consumption due to higher production volumes while the water intensity of the individual companies remained steady except the aluminium segment of ElvalHalcor which showed an improvement of 8% in water intensity. The steel and cables segments also showed a significant reduction in water consumption in 2021 despite the higher production volumes which is attributed mostly to improvements in the water intensity of Sovel (18%) and Icme Ecab (17%) which proves that the water reduction efforts have a significant effect on the water intensity of the individual companies.

	Aluminium segment	Copper segment	Steel segment
2021	977	765	2,509
2020	884	699	2,530
2019	861	682	3,025
Water consumption (10³ m³)

	Cables segment	Steel pipes segment
2021	305	44
2020	315	63
2019	403	71
Water consumption (10³ m³)

During 2021, none of the subsidiaries were affected by water shortages and water reserves in all geographic locations. It is important to note that none of Viohalco’s companies is operating in a declared water-stressed areas. However, the companies monitor water availability and the hydrologic cycle as there may be changes in the future, especially considering the expected effect of climate change in the Mediterranean region.

The sourcing of water varies depending on the region. Approximately 32% of the companies’ source water directly from extraction wells while the rest 68% receives the water from the local water companies.

Viohalco companies operate 21 installations throughout Europe that are subject to the Industrial Emissions Directive (Directive 2010/75/EU) and are therefore required to meet very stringent emissions limits in atmospheric emissions standards as well as water effluents. The above-stated plants are required to meet Best Available Technique Associated Emissions Levels (BAT-AELs) that are among the strictest in the world and require extensive investments in environmental infrastructure as the plants require, in many cases, high level of water treatment to meet local discharge limits.

The discharge points are regularly monitored either by automated systems on a 24-hour basis or periodically, by specialized personnel. The discharge of treated wastewater is a very important issue especially for the companies discharging treated wastewater directly to a water body and not to a wastewater network for further treatment. The measurement of possible incidents of discharge limits exceedances is critical in identifying the level of compliance as well as the possibility for any need of corrective measures. The wastewater discharge of all the companies are monitored closely by the pertinent authorities on a periodic basis.

During 2021, there was one administrative fine for one occurrence in Stomana Industry collected wastewater samples.

Energy consumption and sources of energy (SDG 7)

Most of Viohalco companies are electricity intensive because of the nature of metal processing, both in metallurgy as well as downstream processing. Energy efficiency of industrial operation is an extremely important matter that besides its obvious economic implications, has also a direct effect to the indirect carbon footprint (Scope 2 emissions). Energy efficient operations are considered by Viohalco and its subsidiaries absolute prerequisites for securing long-term viability.

The focus of energy efficiency efforts is on identifying investment opportunities in energy efficiency measures through periodic energy audits performed by specialized consultants. It is important to note that 67% of the plants in the scope of the NFD are already certified with the Energy Management System ISO 50001:2018 and hence, are required to demonstrate continuous improvement of energy-related KPIs.

The Viohalco companies generally purchase electricity from the main energy suppliers of the countries they operate as none of the companies own their own energy source. The energy consumption of each segment is shown below. All the segments experienced an increase in total energy (thermal and electrical) consumption in 2021 due to higher production volumes. The energy intensity of the individual companies

VIOHALCO | ANNUAL REPORT 2021 83

remained at similar levels as in 2020 with small variations (<2%) from year-to-year intensities except in the case of Elval, the aluminium rolling division of ElvalHalcor S.A., which showed an improvement of 8% in energy intensity, primarily due to the first full of operation of the new, more efficient, four stand tandem hot-rolling mill.

Besides energy consumption, it is of strategic importance for Viohalco subsidiaries to have access to low carbon electricity to minimize their carbon footprint as well as to decrease their exposure to carbon pricing through indirect emissions. The numbers shown in the following table reflect the grid energy mix and renewable energy share for the respective grid. The companies’ strategic goal is to cover the entirety of its electricity needs with renewable energy. Given their geographic footprint and the existing power market regulatory frameworks in these countries, currently there are limited available viable routes towards this goal. In the meantime, the companies continuously explore alternatives for direct supply of renewable electricity, such as bilateral or market based Green PPAs. As mentioned earlier, the entire cables segment as well as Corinth Pipeworks are in the final stages of securing such PPA which are expected to deliver 80% RES power by 2025 at the latest.

	Aluminium segment	Copper segment	Steel segment
2021	1,099	375	1,710
2020	978	353	1,572
2019	993	348	1,710
Total energy consumption (10³ MWh)

	Cables segment	Steel pipes segment
2021	169	34
2020	153	48
2019	151	56
Total energy consumption (10³ MWh)

	Aluminium segment	Copper segment	Steel segment
2021**	28.6	22.5	23.8
2020	28.6	22.4	23.6
2019	25.3	19.9	20.7
Renewable energy share in electricity (%)*

	Cables segment	Steel pipes segment
2021**	32.7	25.9
2020	32.8	25.9
2019	29.6	22.9
Renewable energy share in electricity* (%)

* All data based on AIB 2019-2020 residual mix reports (Greece, Bulgaria, Romania). UK data based on UK National Statistics on Energy report 2021.
** Number is an estimation as final figures for the Greek and Bulgarian energy grid are not finalized as of the date of publication

Climate change impact (SDG 9)

Climate protection is one of the priority issues on the European Union agenda. Climate change presents a threat to the viability of the planet and the EU has the ambition of becoming the first climate neutral continent in the world by 2050. Viohalco companies support EU’s “Roadmap to 2050” and have committed to contribute actively and decisively by reducing carbon emissions in their operations as well as through low carbon enabling products that are vital in the energy transition and for the customers to meet their own sustainability goals.

The biggest challenges the companies commonly face is the minimisation of carbon emissions, both direct (Scope 1) and indirect (Scope 2) but most importantly, Scope 3 emissions (supply chain) as the latter generally contribute for the vast majority of embedded emissions in the delivered products.# Environmental protection and responsible production (SDG 12)

Viohalco companies make continuous efforts to minimize the environmental impact of their operations. Vital to this effort is the implementation of prevention measures in chemicals storage and use as well as continuous monitoring for the case of accidental incidents (spills or leaks) to the environment. All environmental incidents that have the potential to impact the environment directly or indirectly are closely monitored and procedures have been developed for their immediate detection, investigation, and immediate remediation if they do occur. All necessary safety measures (secondary containments, implementation of zone owners, etc.) have been implemented by the companies, so that the probability of a pollution incident is very low. During 2021, no such incidents with any impact on the environment occurred. All spills of chemicals or fuels that occurred in 2021 were contained within the secondary containment structure in place and were immediately resolved without consequences. It is important to note that all the installations under scope of the NFD are certified according to ISO 14001:2015 international standard.

As part of the ESG Roadmap, Viohalco and its subsidiaries implemented in 2021 a new initiative to identify, record and flag associated hazard risks of all the chemicals purchased, stored, and used in the industrial plants. This project, due to its size, is expected to be completed within 2022.

Viohalco companies are committed to environmentally friendly waste management and aim primarily at waste generation reduction and improvements related with reuse and recycling, as well as identifying contractors with a more environmentally friendly treatment method. The companies’ goal is to maximize closed loops cycles according to circular economy principles and the European Green Deal initiatives. Waste volumes generally increased in 2021 due to the higher production volumes across most segments. Although waste generation intensity varies significantly depending on the production process, the waste intensity per company has remained at similar levels. It is noticeable, however, that the steel segment which is the most waste-intensive segment of Viohalco continues to improve its waste footprint with year-to-year improvements. Due to the gradual decharacterization of its waste from the “waste status” to “by-products” status according to the Waste Framework Directive, they improved the waste intensity 19% year-over-year on a consolidated basis. The portion of the generated waste that is sent for reuse, remanufactured or recycling remained at high levels for all segments supporting the transformation to a circular economy.

Due to their relatively high electro-intensity, certain Viohalco companies generally have a much higher Scope 2 emissions than Scope 1 emissions. As mentioned earlier, the companies have a strategic goal to cover the entirety of its electricity needs with renewable energy PPAs. Given their geographic footprint and the existing power market regulatory frameworks in these countries, currently there are limited available, viable routes towards this goal. The total footprint figures below (Scope 1 and 2) are reported according to Greenhouse Gas Protocol Scope 2 Guidance (https://ghgprotocol.org/scope_2_guidance) which is the most commonly used standard internationally. It is important to note, however, that in order for metal production companies in general to reach net-zero emissions by 2050, a global transformation of industrial production will be required as the necessary investments are technologically and economically several years (decades in some cases) away until they reach industrial scale. These elements are among others, green hydrogen to replace natural gas for thermal energy and a continuous supply of low carbon electricity as currently the energy storage is not competitive enough to ascertain 24-hour delivery of green energy. The potential for the further reduction of carbon intensity, therefore, has external limitations and higher reduction potentials must first be developed and tested on an industrial scale before being incorporated in the companies’ operations.

In particular, two Viohalco subsidiaries, Hellenic Cables and Corinth Pipeworks, have already committed to the Science Based Target Initiative (SBTi) to meet near-term (2030) and long-term net zero targets at the latest by 2050. More specifically, Hellenic Cables has already submitted its targets pending validation from SBTi, to halve its scope 1 & 2 emissions (50% by 2030 from a 2020 base year) and reduce value chain emissions (scope 3, including raw materials and commuting emissions) by 25%, within the same timeframe. Hellenic Cables also commits to increase annual sourcing of renewable electricity to 80% and 100%, by 2025 and 2030, respectively. Over and above near-term progress, Hellenic Cables projects to reach net-zero greenhouse emissions across its entire value chain before 2050, from a 2020 base year. Corinth Pipeworks submitted its commitment in February 2022 and is awaiting for its approval from SBTi.

Currently, there are five Viohalco companies in the EU Emissions Trading System (ETS) and one company in the corresponding UK Trading System. All Viohalco companies in the corresponding trading systems receive less free allowances than their actual emissions and a result, they are required to purchase carbon allowances on a annual basis. This shortage of allowances has an increasingly negative effect on their competitiveness as it does in over 95% or European industrial companies that participate in the ETS. The cost-free allocation is based on benchmarks, which unfortunately are far from adequate for even the most efficient Viohalco companies’ industrial plants.

Total carbon emissions are shown below in order to show the materiality of carbon emissions and the corresponding exposure each segment has. The higher total emissions across all segments reflects the higher production volumes in 2021 compared to 2020. The carbon intensities of the individual companies remained at similar levels as last year while Elval showed a significant improvement (7.6%) due to the reduction of indirect emissions.

VIOHALCO | ANNUAL REPORT 2021 84

Aluminium segment

	2021	2020	2019
Direct emissions (Scope 1)	148,086	131,118	132,710
Indirect emissions (Scope 2)	163,664	148,330	169,085
Total carbon emissions*	311,750	279,448	301,795

Copper segment

	2021	2020	2019
Direct emissions (Scope 1)	40,497	37,562	36,747
Indirect emissions (Scope 2)	65,479	59,675	70,271
Total carbon emissions*	105,976	97,237	107,018

Steel segment

	2021	2020	2019
Direct emissions (Scope 1)	187,987	160,612	184,675
Indirect emissions (Scope 2)	529,710	492,511	615,181
Total carbon emissions*	717,698	653,123	799,856

Cables segment

	2021	2020	2019
Direct emissions (Scope 1)	14,724	15,743	13,989
Indirect emissions (Scope 2)	40,510	36,594	42,024
Total carbon emissions *	55,235	52,337	56,013

Steel pipes segment

	2021	2020	2019
Direct emissions (Scope 1)	1,797	3,212	2,434
Indirect emissions (Scope 2)	13,096	19,887	26,740
Total carbon emissions *	14,893	23,099	29,174

* Total carbon emissions in tn CO2 / yr. Figure includes Scope 1 and Scope 2 emissions

Waste generation (tn)

	2021	2020	2019
Aluminium segment	61,183	52,738	51,269
Copper segment	30,663	31,795	36,217
Steel segment	184,325	204,856	358,818
Cables segment	15,372	15,211	14,162
Steel pipes segment	16,130	25,077	27,598

Waste reused, re manufactured and recycled* (%)

	2021	2020	2019
Aluminium segment	98	98	98
Copper segment	95	96	95
Steel segment	86	88	94
Cables segment	92	91	89
Steel pipes segment	99	99	99

* Waste reused, remanufactured, recovered and recycled measured versus total waste generated

EU Taxonomy

The EU's Regulation on the establishment of a framework to facilitate sustainable investment (the Taxonomy Regulation EU 2020/852) requests (Article 8) that companies subject to an obligation to publish non-financial information shall disclose in their NFD the proportion of their turnover, capital expenditure and operating expenditure related to “Taxonomy-eligible and Taxonomy non-eligible economic activities”. 1

Viohalco has evaluated the business activities against the EU Taxonomy eligibility criteria for climate mitigation and climate adaptation and has subdivided eligible activities into four types (cf. Disclosures Delegated Act EU 2021/2178):

Eligible economic activity	Description	NACE- Code	Climate change mitigation	Climate change adaptation
3.8 Manufacture of aluminium	Secondary aluminium production	C24.42		
3.9 Manufacture of iron and steel	Manufacture of iron and steel, EAF production with over 90% of steel scrap relative to product output	C24.10		
3.1 Manufacture of renewable energy technologies products	Manufacture of insulated wiring cables used for the renewable energy sector	C27.32	
4.9 Transmission and distribution of electricity	Construction and Installation services of electricity distribution networks	C35.13		
		C35.12

The cables segment produces cables products that are used in various applications including renewable technologies manufacturing (3.1), as well as installation projects for transmission and distribution of electricity (4.9). The activity of the steel segment, produces crude steel in Electric Arc Furnaces (EAF) (3.9), using as raw materials scrap steel in a percentage higher than 90% relative to steel product output. The aluminium segment engages in secondary aluminium production (3.8), through the different aluminium companies. The table below present the necessary KPIs for the eligible Viohalco companies, based on Article 8 reporting requirements.

1. Activities that qualify as environmentally sustainable under Articles 3 and 9 of the same Regulation.

VIOHALCO | ANNUAL REPORT 2021 86

■ Responsibility towards society

Occupational health and safety (SDG 3 and 8)

The nature of the diversified portfolio of Viohalco companies results in a different occupational health and safety risk profile for each company.The difference is attributed to many factors such as type of production, thermal metallurgy, rolling, extrusion, chemical coating, etc., technology of infrastructure, equipment condition and safety features, manufacturing processes and materials used. Irrespective of the different nature of the company activity, the health and safety of the companies’ personnel is of utmost importance and the companies invest significant amount of resources to improve working conditions and create a safer working environment. Viohalco companies are committed to provide their employees a safe working environment and this is provided through investments in improving existing safety infrastructure (machine guarding, LOTO), increasing risk awareness and Behavior Based Safety through training programmes and establishing solid procedures and management systems. Viohalco companies in an effort to improve risk awareness among employees, develop detailed risk assessments by conducting a systematic hazard identification associated risks evaluation, subsequently facilitating the implementation of reasonable control measures. Emphasis is also given in performing accurate incidents analysis to ensure there is a solid framework in place for a systematic approach to incident reporting, management, and investigation, thereby enabling effective corrective and preventive actions to be set. During 2021 and as part of the ESG Roadmap strategic goals, all subsidiaries were required to establish a five-year improvement plan. The year 2022 will be the first year of the action plan implementation and Steelmet personnel will monitor closely the timely implementation. It is important to note that all the installations under scope of the NFD are certified according to ISO 45001:2018 so the installations are subject to external audits by the certifying bodies as well. As health and safety matters are of strategic importance to Viohalco’s subsidiaries, further evaluations and health checks of the H&S programmes are performed by a third party (DuPont Sustainable Solutions) on a periodic basis to ensure a transparent and objective assessment. These assessments are additional tools for identifying improvement areas. Three out of the five segments showed a deterioration in the Lost Time Incident Rate (LTIR) and the companies have identified the improvement areas they will focus on in 2022 as well as the subsequent years to create a safer working environment. The severity rate, another main indicator used to show the seriousness of each incident, shows a declining trend as three out of the five segments showed an improvement in 2021. Besides the two lagging indicators previously stated, the companies have an extensive list of internal leading indicators to guide them through the improvement process. Training in health and safety matters is of critical importance and emphasis has been given to the completion of a training matrix that is customized to each job description and the completion of all necessary sessions for each employee.

EU Taxonomy – Viohalco

Economic activities	Amounts in EUR millions	% of Turnover	% of CAPEX	% of OPEX
A. Eligible activities
Production of secondary aluminium	843.5	15.7%	18.2	6.8%
Production of secondary steel	967.1	18.0%	4.0	1.5%
Production of cables products and provision of services	290.2	5.4%	17.1	6.4%
Environmentally sustainable activities (A.1)	2,100.8	39.1%	39.3	14.8%
B. Non-eligible activities
Non-eligible activities (B)	3,273.7	60.9%	226.8	85.2%
Total (A+B)	5,374.5	100.0%	266.0	100.0%

Further information about the allocation of turnover, CAPEX and OPEX to the environmental objectives of the EU Taxonomy can be found in pages 110-112.

VIOHALCO | ANNUAL REPORT 2021 87

	Aluminium segment			Copper segment			Steel segment
	2021	2020	2019	2021	2020	2019	2021	2020	2019
LTIR*	5.4	4.1	7.1	6.8	7.1	8.5	5.0	3.6	5.0
SR**	182	70	86	122	226	376	115	80	243
H&S training hours per employee	4.7	2.7	4.7	4.9	3.8	3.1	3.2	1.7	3.8
# fatalities	0	0	0	0	0	0	0	1	1

	Cables segment			Steel pipes segment
	2021	2020	2019	2021	2020	2019
LTIR*	8.8	6.4	5.4	1.7	1.7	1.0
SR**	105	111	149	27	119	106
H&S training hours per employee	6.4	6.4	10.2	6.2	5.3	3.7
# fatalities	0	0	0	0	0	0

* LTIR: Lost time incident rate (number of LTI incidents per million working hours)
** SR: Severity rate (number of lost workdays per million working hours)

Labour and human rights issues (SDG 5 and 8)

Viohalco companies recognize the contribution of their people in their successful business performance and future growth. In line with this approach, the companies are committed to implementing responsible working practices. All Viohalco companies seek to provide their employees a workplace of equal opportunities by investing materially and systematically, in their training and development. Steadily oriented to human values, the companies strive to implement responsible management practices regarding to human resources. As shown in the table below, special circumstances caused by the pandemic crisis faced by some of the segments resulted in very different directions regarding employee turnover ratio. Although relatively stable in the previous years, the employee turnover increased in four out of the five segments. Finally, due to the effects of the pandemic crisis having a smaller impact in 2021, all 5 segments increased the training hours per employee significantly With the further de-escalation of the pandemic effect, the companies have an ambitious plan to increase training hours further in 2022.

	Aluminium segment			Copper segment			Steel segment
	2021	2020	2019	2021	2020	2019	2021	2020	2019
Employee turnover* (%)	12.2	10.1	6.1	20.8	10.2	13.0	10.1	22.5	12.4
% of women	10.3	10.4	8.7	13.9	14.1	12.4	18.4	16.8	18.7
Training hours per employee **	11.0	8.02	18.2	9.9	8.9	9.7	7.4	6.7	6.7

	Cables segment			Steel pipes segment
	2021	2020	2019	2021	2020	2019
Employee turnover* (%)	12.7	10.4	19.3	30.0	15.0	7.5
% of women	12.3	15.8	13.3	8.5	9.8	9.5
Training hours per employee **	16.4	12.6	22.2	11.3	8.3	12.3

* Employee turnover = (employees who leave the organization voluntarily or due to dismissal, retirement, or death in service)/Total employees*100
Total workforce: Total employees at the end of the year (31/12 data).
** Hours of training: Average hours of training per employee per year

VIOHALCO | ANNUAL REPORT 2021 88

Viohalco and its subsidiaries have taken a series of steps to support and increase the share of female employees, such as supporting families with young children with child-care subsidies on top of their base salaries. Viohalco companies have established an Employee Code of Conduct that is based on the principles of the Labour and Human Rights and Business Ethics and Anti-corruption Policies adopted by the subsidiaries. During 2021 and as in previous years, no incidents of discrimination were recorded or reported within the existing grievance mechanisms and no incidents of forced or voluntary child labour occurred. As part of the ESG Roadmap established in 2021, Viohalco and its subsidiaries rolled out two new ambitious and important initiatives to support the transparency and compliance of all companies with the adopted policies. The first initiative is an extensive employee training in matters of labour and human rights, diversity equality and inclusion, and workplace harassment and prevention. The training programme, due to its size, will be completed within 2022 and relative KPIs will be presented in next year’s NFD. The second initiative is the establishment of a whistleblower mechanism for all Viohalco companies which will be implemented in 2022. The mechanism establishes the proper channels of communication for anyone either within or outside Viohalco and its subsidiaries to report illegal behavior regarding labour or human rights practices, environmental compliance, and business ethics issues while at the same time ensuring full protection and support for reporting persons.

Responsible sourcing (SDG 12)

Viohalco companies are committed to operate responsibly in all their business activities while at the same time expecting the same responsibility from its business partners. Due to the relative position of Viohalco subsidiaries in the value chain, the subsidiaries rely heavily on primary metal producers often located outside the EU. It is therefore of utmost importance that the business partners and suppliers of raw materials practice sound management in all ESG matters. Suppliers are, after all, an important resource and Viohalco subsidiaries have the intention to work closely with strategic suppliers in order to establish relationships based on the same ethical, social, and environmental standards. As part of the ESG Roadmap established in 2021, two new initiatives were created to monitor business partners’ performance on sustainability issues. First, Viohalco and its subsidiaries adopted the Supplier’s Code of Conduct which requires the subsidiaries’ business partners to show the same concern for employee health and safety, respect and protection of the environment, and respect for labour and human rights. All subsidiaries during 2022 will request that tier 1 and 2 suppliers of raw materials (on a money spent basis) adopt the Supplier Code of Conduct. The results of the initiative will be presented in a relative KPI in next year’s NFD. The second initiative requires the evaluation of all Tier 1 suppliers of raw materials to be evaluated on sustainability matters by a world class company in this field, Ecovadis. The results of the initiative will also be presented in a relative KPI in next year’s NFD. The purpose of this initiative is to increase transparency in the supply chain and to identify risks that may appear in the future. In addition, responsible sourcing is vital to the delivery of products that carry the minimum environmental and social impact.# Viohalco and its subsidiaries are convinced that only through responsible sourcing the nal products delivered to customers can help them achieve their own sustainability goals. The Responsible Sourcing initiative of Viohalco’s ESG Roadmap includes close monitoring of suppliers’ compliance with the Conict Minerals Regulation in order to ascertain that no material is procured from conict countries.

Disclosures for the implications of Covid-19 Impact

The Covid-19 pandemic aected society to an even greater degree during 2021. Although the various countries in which Viohalco companies operate relaxed some of the preventive measures in place during 2021, Viohalco companies retained the preventive measures in order to attain business continuity (orders for critical materials placed in advance, alternative suppliers identied, increased safety stock for certain materials) and maximum protection of employees and their families. As a result, no interruption of regular operation was experienced throughout 2021 including projects under construction/ commissioning.

Overall, due to the mitigating measures taken by the subsidiaries, Covid-19 was not disruptive to any of the companies meeting its sustainability goals and actions, including employee training which during 2020 decreased signicantly. The companies were able for the most part return to previous or higher levels of training with more sessions and less people present in order to avoid super-spreading events. An even more ambitious training programme is planned for the majority of Viohalco companies in 2022 in order to compensate for the loss of scheduled personnel classroom training in 2020.

During 2021, emergency response plans remained in place with small variations depending on the various infection waves throughout the seasonal changes of the year. Viohalco and its companies implemented multiple preventive and mitigating measures in all aspects of work life that included frequent preventive PCR testing, transportation to and from work, obligatory mask use in all indoor company sites, extensive hygiene measures, medical advice and support to all work force, especially vulnerable groups. Remote work varied depending on the risk exposure and the density of seating among employees always in compliance with guidelines or mandatory requirements by the competent national authorities.

The companies’ management was supportive to all employees throughout the pandemic by allowing for ample quarantine time when employees were exposed to confirmed cases. In addition, a support help line with a dedicated 24-hour telephone line by a specialized service was offered to all Viohalco companies’ employees throughout this trying period of quarantines and personal distress. The enhanced health and safety preventive and mitigating measures remain in place across Viohalco companies and the same model will be followed on a risk-based approach.

VIOHALCO | ANNUAL REPORT 2021 89

■ Governance

Transparency and anti-corruption (SDG 16)

Viohalco and its companies acknowledge the signicance of business ethics and anti-corruption matters. In order to ensure the implementation of the respective policy, they have applied the proper internal controls and procedures of operation demonstrating accountability, fairness, and transparency in the relationship with all stakeholders.

As part of the ESG Roadmap established in 2021, Viohalco companies implemented a new initiative for employee training in matters of business ethics and code of conduct, and anti-bribery and corruption. The training programme, due to its size, will be completed within 2022 and relative KPIs will be presented in next year’s NFD. The training programme aims at management and employees with a special risk prole due to the nature of the job. The training will include special sessions for the management teams in order to ensure that all matters involving business ethics (money laundering, antitrust and competition laws, anti-corruption, data privacy, etc.) are well comprehended.

Furthermore, a second initiative established in the ESG Roadmap in 2021 is the whistleblower mechanism that is intended to detect and prevent illegal behaviour at an early stage. The whistleblower mechanism will be implemented in 2022. The mechanism establishes the proper channels of communication for anyone either within or outside Viohalco and its subsidiaries to report illegal behavior regarding labour or human rights practices, environmental compliance, and business ethics while at the same time ensuring comprehensive protection and support for reporting persons. The mechanism will be in compliance with the European Whistleblowing Directive.

During 2021, no incidents of corruption or bribery were recorded or reported within the existing grievance mechanisms while there were no incidents of data privacy breaches as reported by the GDPR Data Protection Coordinators of each Viohalco company. In addition, there were no nes paid due to settlements for unethical business practices or corruption matters.

■ Integrated management of non nancial risks

Viohalco and its companies face a variety of non-nancial risks as previously discussed and has a risk identication process in order to identify those risks and implement mitigation measures wherever possible. All industrial activity-related risks such as environmental and health and safety are associated with the subsidiaries with industrial operations. Managing the non-nancial risks is considered to be a very critical task by the companies’ management as these risks have the potential to create a direct or indirect impact on the companies’ continuous operation as well as to create future liabilities.

In order to improve risk management in non-nancial issues among subsidiaries, Steelmet professionals have established policies and procedures for managing risks that companies’ management must comply with. Furthermore, the ESG Roadmap has established the periodic monitoring of several key leading and lagging indicators in order to monitor progress on all ESG-related risks as well as risks that the companies anticipate will be or have the potential to be disruptive in the future. Such risks relate to new legislation coming into eect in the future such the ‘’Fit-for-55’’ package of legislative initiatives.

The companies have their own skilled personnel and consultants managing these matters and they implement certied management systems ISO 14001:2015 and ISO 45001:2018 as well as the energy management system 50001:2018, thus providing an additional management tool for all related risks. The management systems provide the framework for planning and implementing measures, taking the proper preventive steps, monitoring the eciency of the measures, and providing the continuous improvement culture necessary to ensure improving performance and risk management.

Risks are analyzed from a nancial, environmental, and social perspective in order to get a full understanding of the complete array of impacts of non-nancial issues. Below is a description of the main non-nancial risks identied that may aect business operations, reputation, and ultimately the nancial results of Viohalco.

Environment

The major risks related to environmental issues are regulatory compliance, climate change and water management.

Regulatory Compliance

The regulatory environment in which Viohalco companies operate is very demanding as industrial operations in Europe, especially in metal processing, are subject to a broad range of laws and regulations that are updated on regular intervals. The regulatory framework imposes stringent standards that require a continuous eort in human and capital resources in order to comply. Hazardous waste management, discharge limits, atmospheric pollution abatement, are some examples of environmental matters that can create potential liabilities for Viohalco companies.

The associated risks extend to nancial risks (regulatory nes, pollution liabilities, remediation requirements), environmental risks (environmental damage to groundwater, surface soils, ecosystems) and social (impact to local communities’ quality of air or water supplies). It is important to note that 21 industrial installations of Viohalco companies are in the scope of the Industrials Emissions Directive of the EU which requires industrial installations to operate with the obligatory implementation of Best Available Techniques to ensure stringent emission limits. Mitigation of all those risks are managed by the established environmental management programmes and trained professionals at Viohalco companies.

The total annual environmental expenditures of Viohalco companies are in excess of EUR 25 million over the last few years with an upward trend due to continuous improvement eorts implemented by the subsidiaries.

Climate change

Although ambitious and absolutely necessary to address the biggest current challenge for the environment, the proposed Fit- for-55 package by the EUposes several risks for Viohalco companies’ carbon intensive industries due to its short fall to create a level- playing eld with industries operating outside the EU. Although intended to protect carbon intensive companies from carbon leakage, the proposed Carbon Border Adjustment Mechanism (CBAM,) current measures are insucient to provide the framework for avoiding circumvention by resource shuing of extra-EU companies . At the same time the current plan gradually decreases free allocation and does not address much needed measures to allow for a WTO-compatible, carbon cost recovery for European exports. As such, carbon-related framework conditions for 2030 are being analyzed in various scenarios of carbon costs emanating from proposed climate policies and how these may aect the competitiveness of Viohalco companies due to direct and indirect carbon emissions related costs as well as the anticipated impact on the cost of imported primary metals.# Viohalco companies consider that climate change is an area with a material impact not only with respect to nancial materiality (negative impact on the company) but also with respect the environment and society (negative impact to climate, hence to the environment and society).

The nancial materiality stems from the fact that the companies have transition as well as physical risks. Transition risks relate to risks arising from the transition to a low carbon economy such as the proposed policies that:

• Require demanding energy eciency measures;
• Impose carbon pricing mechanisms which intend to increase carbon price, aecting both cost of direct and indirect emissions;
• Impose CBAM on the aluminium and steel industries which are included in the rst phase of the mechanism and as a result, gradually decreases the free allowances these companies receive.

The Viohalco segments of steel, aluminium and copper, characterized by their energy intensive production processes, are some of the most exposed sectors in industrial manufacturing to carbon leakage because they are priced globally as commodities and are highly energy intensive. The existing technologies to mitigate the carbon emissions from the consumption of thermal and electrical energy are not widely available from a technological and economic perspective and therefore Viohalco companies do not have an alternative for aggressive decarbonization measures in their production processes in their immediate future, especially in the substitution of thermal energy which relies on natural gas. The EU’s new ambitious goal of 55% reduction climate target in 2030 will further increase carbon leakage risk, and while there are eorts to mitigate that risk, the nancial materiality remains signicant.

Physical risks relate to risks associated with long chronic eects such as extreme weather, rising sea levels, and reduced freshwater availability. The physical risks for Viohalco companies remain low due to the geographical locations most plants are, but Viohalco and its companies continuously monitor changing conditions that may create physical risks in the future.

The risk mitigation measures taken by the companies are, among others, the following:

• Early policy trend identication and cooperation with European Federations in order to inform policy makers of the risks for the European metals industry;
• Involvement and participation in sector studies to identify all related risks for carbon leakage and wider implications to the national economies as well as disruption to supply chains in the countries Viohalco companies operate;
• development of action plans for investments in energy ecient equipment and carbon abatement measures;.
• increase of capacity for utilization of secondary raw materials instead of primary; and
• proper budget management practices that incorporate projected carbon costs.

From an environmental and social perspective, Viohalco companies directly emit greenhouse gases to the atmosphere due to their routine production operations and indirectly through consumption of electricity. There are currently ve companies (ElvalHalcor, Sidenor, Sovel, Stomana Industry and Soa Med) in the European Trading Scheme and Bridgnorth Aluminium in the UK Carbon Scheme and these companies have made a series of investments in the past 15 years for carbon emissions reduction. In addition, all these companies are included in the corresponding schemes’ carbon leakage sectors so measures are taken for the protection of these sectors from carbon leakage at least until the end of 2025. The sum of the direct and indirect emissions of Viohalco segments is shown in the previous chapter as these are the most closely observed KPIs at each company level.

Upstream activities include raw materials extraction, such as aluminium, copper and steel and amount to signicant emissions to the environment. Selection of raw materials suppliers is critical to identify areas of improvement and is considered the highest contributor to the overall emissions of the subsidiaries’ products. As stated earlier, the carbon footprint attributed to upstream activities amount to over 80% and reach up to 95% in some cases. The subsidiaries are in the process of identifying and evaluating dierent suppliers and their potential exposure to higher carbon costs as the increasing cost of carbon will eventually aect their competitiveness.

Water management

As stated earlier, water is an essential element of the Viohalco companies’ production process, and its availability is very important to the companies’ business continuity. The two water related risks are associated with:

• the availability of adequate water in both quantity and quality
• the adequate treatment of wastewater before its discharge.

Lack of availability of water, especially in water stressed areas, can lead to serious disruptions to the companies’ operation. In addition, the lack of water with the proper quality characteristics can lead to the need of signicant investments for water treatment that can also increase demand for energy (energy demanding treatment techniques like reverse osmosis) as well as increase in waste generation (wastes from water treatment). Water supply-related risks are important from a nancial and environmental perspective. Certain Viohalco companies are relatively water intensive as shown in the previous chapter. These companies treat the water supply risk as a business continuity issue that can ultimately have nancial materiality (negative impact on the company). In addition to the nancial implications of water shortages, environmental implications can occur when water shortages limit the amount of water available for other uses such as irrigation, municipal use, etc.

The risk is mainly mitigated by our continuous eorts to improve the water footprint of the companies by setting internal goals for water use minimization, reevaluating existing usage, training VIOHALCO | ANNUAL REPORT 2021 90 VIOHALCO | ANNUAL REPORT 2021 91 employees on the importance of water use and have multiple sources of water so there are alternative sources of supply.

Regarding wastewater quality discharge, the associated risk that could result from a breach of local discharge limits, is the adverse eect to local water supplies, reputational damage, and other administrative and criminal prosecution. The risk is mitigated through the proper infrastructure in place (adequate capacity of waste water treatment), properly trained personnel, preventive maintenance of equipment and very close performance monitoring so as to identify any possible problems in wastewater treatment.

Social and labour issues

The major risks related to social and labour matters are the occupational health and safety of the labour force and employee matters. These risks are signicant from a nancial and social perspective. Viohalco companies are exposed to occupational health and safety risks at industrial sites. Due to the nature of Viohalco companies’ industrial operations (thermal metallurgy with high temperature processes, heavy equipment, chemical treatment, work at heights, etc.) there is an inherent risk for accidents among the workforce or contractors with impact on human life, local communities, and reputation.

With regards to occupational health and safety risks, Viohalco companies have management systems in place following a comprehensive approach for improvement which is translated into equipment upgrading, implementation of management principles (safety audits, standard operational procedures, work instructions, etc.), the establishment of a targeted safety training programme and the direct involvement of management. The companies’ management have a clear understanding of the importance of providing a safe working environment to the labour force and how vital it is to continuously strive for improvement as this is fundamental for good labour relations and business performance.

Employee related risks entail potential violations of equal treatment and statutory working hours by personnel that may lead to operation interruption risks. These risks are mitigated by the companies through the implementation and monitoring of compliance with the employee Code of Conduct, personnel evaluation and training, and regular internal audits.

Social risks are especially signicant in the supply chain of Viohalco’s companies as the raw materials used by Viohalco companies are located in various geographic locations with varying degrees of labour and environmental standards. Typically, the vast majority of the environmental and social footprint of Viohalco companies’ products originates from the supply chain. The Responsible Sourcing initiative described in the previous chapter targets the evaluation and engagement of all major suppliers so to identify business partners with poor environmental, social and governance practices. Following the evaluation, Viohalco companies will engage them regularly to monitor progress on an action plan or look for alternative suppliers that meet the companies’ ethical and environmental standards.

Human rights

The major risks related to human rights are related to the supply chain of the companies provided that many suppliers are not located in Europe or North America. As mentioned previously, the Responsible Sourcing initiative already developed, will assess among other issues, the business partners’ practices in human rights. Following the evaluation, Viohalco companies will engage them regularly to monitor progress on an action plan or look for alternative suppliers that meet the companies’ ethical and environmental standards.

Anti-bribery and corruption

The risks related to anti-bribery and corruption lies in the failure to conduct business operations ethically and comply with the laws and regulations in the jurisdictions in which Viohalco and its companies operate.# I. Corporate governance statement

Introduction

To prevent and mitigate such risks, the whistleblower mechanism was created in the ESG Roadmap initiative so as to ascertain that any illegal behavior can be reported without retribution to the person reporting the illegal behavior. Furthermore, the internal audit function is responsible for monitoring and reporting timely and properly any related deviation or misconduct. Simultaneously, subsidiaries separately organize training courses and communication actions in order to increase awareness and stress the importance of compliance with the companies’ employee Code of Conduct. Detailed information on Viohalco companies’ actions can be found in their standalone sustainability reports which are published on an annual basis.

VIOHALCO | ANNUAL REPORT 2021 92

As a company incorporated under Belgian law and listed on Euronext Brussels, Viohalco applies standards that are compliant with the provisions of the 2020 Belgian Corporate Governance Code (the 2020 Code), which is the reference code and is publicly available on the website of the Corporate Governance Committee (www.corporategovernance-committee.be). The 2020 Code is structured around principles, provisions, guidelines, and the «comply or explain» principle. Belgian listed companies must abide by the 2020 Code but may deviate from some of the Code’s provisions, if they provide a considerate explanation for any such deviation.

During the 2021 nancial year, the Company complied with the principles of the 2020 Belgian Corporate Governance Code, except for the following:

• Principle 7.6: “A non-executive board member should receive part of their remuneration in the form of shares in the company.”
• Principle 7.8 “The variable part of the executive remuneration package should be structured to link reward to overall corporate and individual performance, and to align the interests of the executives with the sustainable value-creation objectives of the company.”
• Principle 7.9: “The board should set a minimum threshold of shares to be held by the executives.”

Explanation: The remuneration policy of the Company is set out in the remuneration report. Such policy provides for neither variable remuneration, nor share-based remuneration. The board of directors will consider the proposals submitted by the Nomination and Remuneration Committee in order to determine whether, and to what extent, a modication of this policy is justied in light of the Company’s objectives and strategy. The Nomination and Remuneration Committee is in the process of developing a variable remuneration plan for the members of the Executive Management.

Viohalco’s Board of Directors ('BoD') has also adopted a Corporate Governance Charter in order to reinforce its standards for the Company in accordance with the recommendations set out in the 2020 Code. It aims at providing a comprehensive and transparent disclosure of the Company’s governance which is reviewed and updated from time to time. The Corporate Governance Charter (the Charter) is available on the Company’s website (www.viohalco.com).

In order to have a complete overview of Viohalco’s corporate governance rules, the Corporate Governance Statement must be read in conjunction with the Company’s articles of association, the Charter as well as the corporate governance provisions laid down in the Belgian Code on Companies and Associations (the BCCA).

As a company secondary listed on the Athens Stock Exchange (Athex), Viohalco also complies with the provisions of the applicable Greek capital market laws and regulations.

Board of Directors

1. Role

Viohalco has chosen the one-tier governance structure. The board of directors (the Board) is vested with the power to perform all acts that are necessary or useful for the Company’s purpose, except for those actions that are specically reserved by law or the articles of association to the Shareholders’ Meeting or other management bodies. In particular, the Board is responsible for:

• dening the general orientations of the Company;
• deciding on and regularly reviewing any aspect related to all major strategic, nancial, and operational matters of the Company;
• deciding on the Executive Management structure and determining the powers and duties entrusted to them;
• taking all necessary measures to guarantee the quality, integrity, and timely disclosure of the Company’s nancial statements and other material nancial or non-nancial information about the Company in accordance with the applicable law;
• monitoring and reviewing the eectiveness of the Audit Committee and the Nomination and Remuneration Committee;
• approving a framework of internal control and risk management set up by the Executive Management and reviewing its implementation;
• monitoring the quality of the services provided by the statutory auditor(s) and the internal audit, taking into account the Audit Committee’s review;
• approving the remuneration report submitted by the Nomination and Remuneration Committee; and
• any other issue reserved to the Board by the BCCA.

The Board has delegated to the members of the Executive Management the duty to implement the corporate strategy determined by the Board and to carry out the general management of the Company.

VIOHALCO | ANNUAL REPORT 2021 93

2. Composition of the Board

In accordance with article 8 of the articles of association, the Board is composed of 15 members as follows:

Name	Position	Term started	Term expires
Nikolaos Stassinopoulos	Chairman, Non-executive member of the Board	May 2021	May 2022
Evangelos Moustakas	Vice-Chairman, Executive member of the Board	May 2021	May 2022
Michail Stassinopoulos	Executive member of the Board	May 2021	May 2022
Ippokratis Ioannis Stassinopoulos	CEO, Executive member of the Board	May 2021	May 2022
Jean Charles Faulx	Executive member of the Board	May 2021	May 2022
Thanasis Molokotos	Executive member of the Board	May 2021	May 2022
Xavier Bedoret	Non-executive member of the Board	May 2021	May 2022
Patrick Kron	Non-executive member of the Board	May 2021	May 2022
Marion Steiner Stassinopoulos	Non-executive member of the Board	May 2021	May 2022
Margaret Zakos	Non-executive member of the Board	May 2021	May 2022
Efthimios Christodoulou	Independent, Non-executive member of the Board	May 2021	May 2022
Francis Mer	Independent, Non-executive member of the Board	May 2021	May 2022
Kay Breeden	Independent, Non-executive member of the Board	May 2021	May 2022
Bernadette Blampain	Independent, Non-executive member of the Board	May 2021	May 2022
Astrid de Launoit	Independent, Non-executive member of the Board	May 2021	May 2022

The mandates of all members of the Board expires at the end of the Annual Ordinary Shareholders’ Meeting to be held in 2022.

3. Information on the members of the Board

Over the past ve years, the members of the Board have held the following positions (apart from their directorship in the Company) and maintained relationships with the following bodies which, in theory, could become the source of conict of interests:

Nikolaos Stassinopoulos, Chairman - Non-executive member of the Board. Mr. Stassinopoulos holds a Master’s degree from the Athens University of Economics and Business. He served as President and Vice-Chairman of Viohalco Hellenic.

Evangelos Moustakas, Vice-Chairman - executive member of the Board. Mr. Moustakas joined Viohalco in 1957 where he held various technical and managerial positions, in particular the position of President of the Board of Directors of several subsidiaries of Viohalco, such as Hellenic Cables S.A. and Etem S.A. He serves as President of the Board of Directors of the Hellenic Copper Development Institute and as a member of the Board of Directors of the International Wrought Copper Council (IWCC). He was also a member of the Board of Directors of the European Copper Institute (ECI) for many years. Moreover, he serves as corporate representative in the International Association “Intercable”, the International Cablemakers Federation (ICF, since 1990), and Europacable (since 1991) and is active in the development and promotion of copper and cable products around the world.

Michail Stassinopoulos, Executive member of the Board. Mr. Stassinopoulos graduated from Athens College (1985) and holds a Bachelor Degree (BSc) in Management Sciences from London School of Economics (1989). He also holds a postgraduate diploma (MSc) in Shipping, Trade and Finance from City University Business School (UK). Mr. Stassinopoulos is the President of the Board of Directors of ElvalHalcor Hellenic Copper and Aluminium industry S.A. He is also President of the Board of Directors of the “Hellenic Production - Industry Roundtable for Growth”. He participates in the Board of Directors of the Foundation Michail N.Stassinopoulos- Viohalco and in the Board of the “Council on Competitiveness of Greece”. He was a member of the Hellenic Federation of Enterprises since 1996 and for several years until 2019.

VIOHALCO | ANNUAL REPORT 2021 94

Ippokratis Ioannis Stassinopoulos, CEO – executive member of the Board. Mr. Stassinopoulos holds a Bachelor’s degree in Management Sciences from City University and a Master’s degree in Shipping, Trade and Finance from City University’s Business School (UK). He serves as a member of the General Council of SEV (Hellenic Federation of Enterprises), the Young Presidents Organisation, and the Board of Directors of Endeavor Greece. Mr. Stassinopoulos holds a managerial position at Viohalco Hellenic since 1995.

Jean Charles Faulx, Executive member of the Board. Mr. Faulx holds a Master’s degree in Economic Sciences from the Catholic University of Louvain (UCL). He is a member of the Board of Directors of International Trade S.A., Genecos S.A. (Paris), Terra Middle East (Dusseldorf ), Base Metals (Istanbul), and Metal Agencies (London). He was also member of the Board of Directors of Codin and Codin Treasury Centre S.A.prior to their absorption by Codin in August 2013. Mr. Faulx also serves as CEO of TeproMKCl GmbH, a subsidiary of Viohalco, International trade SA, a subsidiary of Viohalco, Strega sprl. In the past, Mr. Faulx served as CEO of Tepro Metall AG, Airicom France SAS, Studio58 S.A. and Promark SPRL and held various positions at Techno Trade S.A, JCT Invest and Elval Automotive S.A.

Thanasis Molokotos, Executive member of the Board.

Mr. Molokotos holds a Master’s degree in Mechanical Engineering and a Master’s degree in Marine Engineering and Naval Architecture from the Massachusetts Institute of Technology (Cambridge, MA), and a Master’s degree in Mechanical Engineering from Tuft University (Medford, MA); he is President and chief executive ocer (CEO) of Assa Abloy Americas until May 2018. In the past, he has served as General Manager of Molokotos Textile Corporation and design specialist at Rangine Corporation.

Xavier Bedoret, Non-executive member of the Board.

Mr. Bedoret holds a master degree in Law and Psychology from the University of Louvain (UCL) and is a certied public accountant (IRE). He holds also a Certicate in Corporate Governance (INSEAD). After ten years of nancial auditing at KPMG in Brussels (Belgium) and Stamford (USA), he joined the Finance Department and then the Audit & Risks Department of ENGIE (France). Since 2017, he advises boards and audit committees on governance matters. Today, he is also chairman of the board of directors and chairman of the audit committee of Cenergy Holdings. He is also chairman of International Trade, a Viohalco subsidiary.

Patrick Kron, Non-executive member of the Board.

Mr. Kron ia a graduate from Ecole Polytechnique and the Paris Ecole des Mines. Patrick Kron started his career in 1976 in the French Ministry of Industry. He then joined the Pechiney group where he became a Member of its Executive Committee and held senior managerial positions. In 1998, he was named Chief Executive Ocer of Imerys. He became in 2003 Chairman & Chief Executive Ocer of Alstom and left the company in January 2016 after the sale of its Energy assets to General Electric and an associated shares buy-back. He created a consulting company PKC&I and in November 2016, he joined True Capital, a capital rm specialized in BioMedTech and Digital, as Chairman of this rm. Patrick Kron is Chairman of the Board of Imerys since July 2019. He is also a Board Member of Sano (Fran ce) and of Holcim (Switzerland), and sits in the Supervisory Board of Segula Technologies. Patrick Kron has been awarded the « Légion d’Honneur » (Chevalier) and the « Ordre National du Mérite » (Ocier).

Marion Steiner Stassinopoulos, Non-executive member of the Board.

Mrs. Marion Steiner Stassinopoulos holds a Master’s degree and a Ph.D in Psychology from the University of Zurich. She has also completed one year of postdoctoral studies at Northwestern University of Chicago (USA). In the past, she worked as psychologist at the Gerontopsychiatric Centre of the Psychiatric University Clinic of Zurich. She is a member of the Advisory Board of Franz Haniel & Cie. GMBH , Duisburg-Ruhrohrt in Germany.

Margaret Zakos, Non-executive member of the Board.

Ms. Zakos holds a Bachelor’s degree from Queens University, Canada. She was a consultant with a US based management consulting rm and held a senior executive operational position at Mount Sinai Medical Centre, NYC. She has owned and operated private rms: Insurance Brokerage and Real Estate Development. She was a Board member of various Foundation Boards and of the Kingston Health Sciences Centre Board including Committee Roles in Finance and Audit for many years. Currently, she is active in Real Estate Holding companies. She is also member of the Board of directors of Cenergy Holdings.

Efthimios Christodoulou, Independent, non-executive member of the Board.

Mr. Christodoulou holds a Bachelor’s degree in Economics from Hamilton College and a Master’s degree in Economics from Columbia University. He has served on the sta of the National Bureau of Economic Research (New York) and was a lecturer at New York University. Mr. Christodoulou was Governor of the National Bank of Greece, President of the Union of Hellenic Banks, and Director General of the National Investment Bank for Industrial Development (ETEBA), Governor of the Bank of Greece (Central Bank of Greece). He has also acted as President of the Board and CEO of Olympic Airways, Executive President of Hellenic Petroleum S.A., and was a member of the European Parliament. He was Minister of Foreign Aairs and Minister of National Economy in Greece. Until June 2013, Mr. Christodoulou also served as President of EFG Eurobank. He is also President or member of various philanthropic institutions.

Francis Mer, Independent, non-executive member of the Board.

Mr. Mer holds a Master’s degree from Ecole Polytechnique and a Master’s degree in engineering from Ecole des Mines. He serves as honorary President of Safran Group. In the past, Mr. Mer has held various positions at Usinor Sacilor Group, including President of the Board of Directors and CEO, and served as President of Cockerill Sambre, Eurofer (European Steel Association) and the International Iron and Steel Institute. He was President of the French Steel Federation, the National Technical Research Association, EpE (Entreprises pour l’Environnement) and the Cercle de l’Industrie, and co-president of the Board of Arcelor. Mr. Mer was the French Minister of Economy, Finance and Industry from 2002 to 2004.

Kay Breeden, Independent, non-executive member of the Board.

Ms. Breeden holds a Bachelor’s degree in Biology and a Master’s degree in Bio-medical Engineering from the University of Illinois and has participated in Stanford’s University Executive Education Programme. Ms. Breeden has gained unique perspective through key leadership roles in government, corporate and management consulting environments, including eleven years spent at two top tier management consulting rms, Booz Allen and A.T. Kearney; more than fteen years with large global corporations including CBRE, Seagate, and Digital Equipment Corporations in executive positions in Environmental, Health, Safety and Corporate Social Responsibility, Business Excellence and Corporate Facilities and Real Estate; and ve years with the United States Environmental Protection Agency. Ms. Breeden has a broad array of industry experience including high tech, biotech, consumer products, energy, utilities, chemicals, construction and engineering, environmental services, aerospace, real estate, metals and mining and signicant international business experience in Europe, Asia, North and South America.

Bernadette Blampain, Independent, non-executive member of the Board.

Mrs. Blampain holds a Master's degree in Economic Sciences from the Catholic University of Louvain (UCL). She is also specialized in Information Security and Data Protection. She held various technical and managerial positions at ING Belgium SA/NV (formerly Bank Brussel Lambert) during 35 years, more specically in the IT division as project manager, risk manager or responsible for the IT development and maintenance of dierent banking areas. Since early 2019, she has held the position of Data Protection Ocer in the medical sector.

Astrid de Launoit, Independent, non-executive member of the Board.

Mrs. de Launoit holds a Bachelor’s degree in Economics and Finance from the University of Lille (Université Catholique de Lille) and a Master’s degree in Management specialized in Luxury. She is also a graduate of the Gemological Institute of America. She has worked in several positions in the luxury and education sectors. Within the last 5 years, Mrs. de Launoit has worked on a fundraising concert for the NGO SOS Children’s Villages. She is currently teaching at ISTEC Brussels.

4. Appointment of the members of the Board

The members of the Board are appointed by the Shareholders’ Meeting under the quorum and majority conditions applicable to an amendment of the articles of association of the Company, upon proposal by the Board. The members of the Board are appointed for a term of one year and their term of oce is renewable. In case a seat of member of the Board becomes vacant, such vacancy may be lled temporarily by virtue of a unanimous vote of the remaining members of the Board, until the next Shareholders’ Meeting which proceeds to the denitive appointment of a Board member. Any proposal for the appointment of a Board member originating from the shareholders must be accompanied by a Board recommendation based on the advice of the Nomination and Remuneration Committee. The Nomination and Remuneration Committee reviews all the candidacies and seeks to ensure that a satisfactory balance of expertise, knowledge, and experience is maintained among the Board members. The Board decides which candidates satisfy the independence criteria set by law. To be considered independent, a member of the Board must full the criteria set forth in Principle 3.5 of the 2020 Code. Any independent member of the Board who no longer fulls the above criteria of independence is required to immediately inform the Board. The Board of Viohalco, having reviewed the independence criteria pursuant to the BCCA and the 2020 Code, has decided that Mr. Efthimios Christodoulou, Mr. Francis Mer, Ms. Kay Breeden, Ms. Bernadette Blampain, and Ms. Astrid de Launoit full these criteria and are independent members. Being a holding company oriented towards industrial companies, Viohalco does not have in place a formal diversity policy for its Board of Directors or its senior executives. The required expertise limits the possibility of gender diversication. It is common worldwide that in an industrial environment in metals processing the vast majority of personnel consists of males.# VIOHALCO | ANNUAL REPORT 2021 96

Committees of the Board of Directors

The Board has set up two committees to assist and advise the Board on specific areas: the Audit Committee and the Nomination and Remuneration Committee. The competences of these committees are primarily set out in the Charter.

1. The Audit Committee

The Audit Committee is composed of Mr. Efthimios Christodoulou, acting as Chairman of the Committee, Mr. Xavier Bedoret, and Ms. Margaret Zakos. All members are non-executive members of the Board and one of them is independent. The majority of the members of the Audit Committee have sufficient experience and expertise, notably in accounting, auditing and finance, acquired through their previous or current professional assignments.

Pursuant to the Charter, the Audit Committee meets at least four times a year, and at least twice a year it meets with the Company’s statutory auditor. The Audit Committee advises the Board on accounting, audit and internal control matters. In particular, the Audit Committee:

• monitors the financial reporting process including risks;
• monitors the effectiveness of the Company’s system of internal control and risk management as well as the internal audit function;
• monitors the conducting of the statutory audit (contrôle legal/wettelijke controle) of the annual and the consolidated financial statements, including any follow-up on questions and recommendations made by the statutory auditor;
• presents recommendations to the Board with respect to the appointment of the statutory auditor; and
• reviews and monitors the independence of the statutory auditor, in particular regarding the provision of non-audit services to the Company.

In 2021, the Audit Committee met four times: on March 17, on May 21, and on December 8, via video conference call, with all members present; and on September 21, in Athens, with all members present.

2. Nomination and Remuneration Committee

The Nomination and Remuneration Committee is composed of Mr. Efthimios Christodoulou, acting as Chairman of the Committee, Mr. Francis Mer, and Mr. Patrick Kron. All members are non-executive members of the Board, and two of them are independent.

Pursuant to the Charter, the Committee meets at least twice a year, and whenever necessary in order to carry out its duties. The Nomination and Remuneration Committee advises the Board principally on matters regarding the appointment and the remuneration of the members of the Board and the Executive Management. In particular, the Nomination and Remuneration Committee:

• submits recommendations to the Board with regard to the appointment, re-appointment and the remuneration of the members of the Board and the Executive Management;
• identifies and nominates, for the approval of the Board, the candidates for filling vacancies as they arise;
• advises on appointment proposals originating from the shareholders;
• periodically assesses the composition and size of the Board and submits recommendations for changes to the Board;
• submits proposals to the Board regarding the remuneration policy; and
• drafts and submits the annual remuneration report, including proposals regarding the remuneration policy and recommendations based on its findings.

In 2021, the Nomination and Remuneration Committee met two times: on March 18 and on December 9, via videoconference call, with two members present.

Evaluation of the Board of Directors and its Committees

The Board regularly assesses its size, composition, performance and those of its committees, as well as its interaction with the Executive Management. On December 10, 2020, the Board reviewed the board evaluation process in order to ensure that the Company operates in an efficient way, consistently encouraging the continuous improvement of the Company’s governance. The non-executive members of the Board assess their interaction with the Executive Management on a regular basis. The performance of Executive Management is also assessed on an informal basis through the presentation of the Company’s performance in respect of the interim and annual financial statements.

Executive Management

The Executive Management comprises four persons: the chief executive officer (CEO), Mr. Ippokratis Ioannis Stassinopoulos; the executive vice-Chairman, Mr. Evangelos Moustakas; the chief financial officer (CFO), Mr. Efstratios Thomadakis; and the Financial Manager of the Greek Branch, Mr. Panteleimon Mavrakis.

In the past five years, the members of the Executive Management held the following directorships and memberships of administrative, management or supervisory bodies and/or partnerships:

• Evangelos Moustakas, Vice-Chairman - executive member of the Board. Please see above section no 3, Information on the members of the Board, Board of Directors.
• Ippokratis Ioannis Stassinopoulos, CEO – executive member of the Board. Please see above section no 3, Information on the members of the Board, Board of Directors.
• Efstratios Thomadakis, CFO. Mr. Thomadakis studied Business Administration and holds an MBA from the University of Piraeus. He joined Viohalco Hellenic in 2000. Since then, he has held various managerial positions in the financial department, whilst in 2010 became the CFO of the Sidenor Group, Viohalco’s steel business segment. He is also member of the Board of Directors of several Viohalco subsidiaries, such as Sidenor Industry S.A.
• Panteleimon Mavrakis, Financial Manager of the Greek Branch. Mr. Mavrakis studied Economics at the University of Piraeus. He joined Viohalco in 1979 and since then has held executive positions in the financial department of several Viohalco companies. From 2000 to 2013, he served as CFO of Viohalco Hellenic and some of its subsidiaries, and since 2013 he is responsible for the accounting and fiscal affairs of the Greek Branch of Viohalco.

The Executive Management is vested with the day-to-day management of the Company. They are also entrusted with the implementation of the resolutions of the Board.

VIOHALCO | ANNUAL REPORT 2021 97

In particular, the Board has assigned the following missions to the Executive Management:

• preparing strategic proposals for the Board;
• putting internal controls in place;
• monitoring and managing the Company’s results and performance against strategic and financial plans;
• giving direction, guidance, and support to the Company’s business;
• preparing and presenting to the Board a timely, accurate, and reliable set of the Company’s draft financial statements, in accordance with applicable accounting standards, and other material financial and non-financial information, as well as the related press releases;
• providing the Board with a balanced and comprehensive assessment of the Company’s financial situation;
• making recommendations to the Board with respect to matters within its competency; and
• reporting to the Board on the performance of the Company.

Remuneration policy

This remuneration policy sets forth the principles applicable to the remuneration of the members of the Board of directors and the Executive Management of Viohalco.

Procedure

This remuneration policy has been prepared by the Board of directors upon recommendation of the Nomination & Remuneration Committee. It was approved by the Shareholders’ Meeting of 25 May 2021 and will be submitted to vote by the shareholders’ meeting each time there is a material change, and at least every four years. This policy may be revised by the Board upon recommendation of the Nomination & Remuneration Committee.# Remuneration Policy

Currently, the Nomination & Remuneration Committee is in the process of developing a variable remuneration plan for the Executive Management. In exceptional circumstances, the Board of Directors may, upon recommendation of the Nomination & Remuneration Committee, temporarily derogate from the remuneration policy if the derogation is necessary to serve the long-term interests and sustainability of the Company or to assure its viability. For the preparation of this remuneration policy, the Board, with the assistance of the Nomination & Remuneration Committee, takes into consideration whether events of conflicts of interests exist. For the prevention of such events, each member of the Board and each member of the Executive Management is required to always act without conflict of interests and always put the interest of Viohalco before his individual interest. They are also required to inform the Board of conflicts of interests as they arise. In the event a conflict of interests may arise, the Board is required to implement the specific procedures of conflict resolution set forth in articles 7:96 of the BCCA.

The remuneration policy is based on the prevailing market conditions for comparable companies, paying at market-competitive level achieved through benchmarking. It takes into account the responsibilities, experience, required competencies, and participation/contribution of the members of the Board of Directors and the members of the Executive Management. The Board of Viohalco, a holding company of a predominantly industrial portfolio, aims at preserving long-term value for its shareholders. The determination and evolution of the Company’s remuneration policy is closely linked with the growth, results and success of the Company as a whole. The Company’s remuneration policy is built around internal fairness and external market competitiveness. The Company's objective is to balance offering competitive salaries while maintaining focus on performance and results.

Board of Directors

The remuneration of the members of the Board of Directors consists in a fixed annual fee amounting to EUR 25,000. In addition, Board members who are members of a Board committee receive a fixed fee of EUR 25,000 per committee. Additional fees or other benefits, such as company car, training, or other benefits ‘in natura’ may be attributed either by the Company or by its subsidiaries based on the responsibilities and number of functions each member of the Board of Directors holds within the Company or in one or more of its subsidiaries. The fees are allocated on a “pro rata temporis” basis for the period extending from the Annual Ordinary Shareholders’ Meeting until the Annual Ordinary Shareholders’ Meeting of the following year and are payable at the end of such period. Members of the Board of directors do not receive any variable remuneration or remuneration in shares. Members of the Board of directors are not entitled to retirement pension plans or severance payments.

Executive Management

The remuneration of the members of the Executive Management of Viohalco consists in a fixed annual remuneration, which is attributed either by the Company or by its subsidiaries. Members of the Executive Management are not entitled to retirement pension plans or severance payments other than what is provided by the applicable law in each case. In order to ensure focus on the Company’s short-term and long-term objectives as well as long-term value creation for all key stakeholders, the Board, with the assistance of the Nomination & Remuneration Committee, has commenced to develop a yearly variable remuneration plan related to the levels of achievement by the beneficiaries of predefined targets which will be added to the fixed remuneration. Such plan would include financial metrics (in this case adjusted EBITDA) as well as a set of individual targets in the following categories: specific Financials, Customer, ESG, Processes & Organizational Efficiency, People & Leadership. Performance would be assessed on an annual basis using a set of pre-determined performance targets in each category, defined at the start of the year. Depending on the performance of each participant, they may receive a variable remuneration between 0 and 100% of the defined variable remuneration “at target”. The variable remuneration may be applicable starting form financial year 2022. The updated policy will be submitted to approval by the shareholders’ meeting of 31 May 2022.

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Remuneration Report

This remuneration report provides an overview of the remuneration granted during the financial year 2021 to the members of the Board of Directors and the members of the Executive Management, in accordance with the remuneration policy. It will be submitted to the vote of the shareholders’ meeting of 31 May 2022. With regard to the contribution of the remuneration to the long-term performance of the Company, the Company uses its KPIs (i.e. Profitability, Revenue) as a measure of its financial performance. The evolution of the measurement during the last five years as published in the Company’s financial statements is presented under the section related to the evolution of the remuneration.

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Board of Directors

The following table (A) provides an overview of the fees paid to the members of the Board of Directors in the financial year 2021:

Table A (Amounts in EUR)

Fixed remuneration for members	Paid by	Base Fees (b)	Other benets (c)	Total	Proportion of xed and variable remuneration
Nikolaos Stassinopoulos	Viohalco	-	-	-	-
	Subsidiaries	50,000	-	50,000	100%
	Total	50,000	-	50,000	100%
Evangelos Moustakas	Viohalco	100,000	-	100,000	100%
	Subsidiaries	1,183,429	-	1,183,429	100%
	Total	1,283,429	-	1,283,429	100%
Ippokratis Ioannis Stassinopoulos	Viohalco	25,000	-	25,000	100%
	Subsidiaries	863,839	-	863,839	100%
	Total	888,839	-	888,839	100%
Michail Stassinopoulos	Viohalco	25,000	-	25,000	100%
	Subsidiaries	863,839	-	863,839	100%
	Total	888,839	-	888,839	100%
Jean Charles Faulx	Viohalco	25,000	-	25,000	100%
	Subsidiaries	210,773	19,642	230,415	100%
	Total	235,773	19,642	255,415	100%
Thanasis Molokotos	Viohalco	25,000	-	25,000	100%
	Subsidiaries	802,543	90,304	892,848	100%
	Total	827,543	90,304	917,848	100%
Xavier Bedoret	Viohalco	320,000	4,012	324,012	100%
	Subsidiaries	50,000	-	50,000	100%
	Total	370,000	4,012	374,012	100%
Patrick Kron	Viohalco	25,000	-	25,000	100%
	Subsidiaries	-	-	-	-
	Total	25,000	-	25,000	100%
Marion Steiner Stassinopoulos	Viohalco	25,000	-	25,000	100%
	Subsidiaries	-	-	-	-
	Total	25,000	-	25,000	100%
Margaret Zakos	Viohalco	50,000	-	50,000	100%
	Subsidiaries	50,000	-	50,000	100%
	Total	100,000	-	100,000	100%
Efthimios Christodoulou (*)	Viohalco	-	-	-	-
	Subsidiaries	-	-	-	-
	Total	-	-	-	-
Francis Mer	Viohalco	50,000	-	50,000	100%
	Subsidiaries	-	-	-	-
	Total	50,000	-	50,000	100%
Kay Marie Breeden	Viohalco	25,000	-	25,000	100%
	Subsidiaries	-	-	-	-
	Total	25,000	-	25,000	100%
Astrid de Launoit	Viohalco	25,000	-	25,000	100%
	Subsidiaries	-	-	-	-
	Total	25,000	-	25,000	100%
Bernadette Blampain	Viohalco	25,000	-	25,000	100%
	Subsidiaries	-	-	-	-
	Total	25,000	-	25,000	100%
Total remuneration	Viohalco	795,000	4,012	799,012	100%
	Subsidiaries	3,924,422	209,947	4,134,369	100%
	Total	4,719,422	213,959	4,933,381	100%

(*) This member of the Board has waived all remuneration.

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Executive Management

The following table (B) provides an overview of the fees paid to the members of the Executive Management during the financial year 2021:

Table B (Amounts in EUR)

Fixed remuneration for members	Paid by	Base Fees (b)	Other benets (c)	Total	Proportion of xed and variable remuneration
Ippokratis Ioannis Stassinopoulos (CEO)	Viohalco	25,000	-	25,000	100%
	Subsidiaries	863,839	-	863,839	100%
	Total	888,839	-	888,839	100%
Executive management	Viohalco	493,454	125,000	3,167	621,622
	Subsidiaries	2,047,268	-	-	2,047,268
	Total	2,540,722	125,000	3,167	2,668,889
Total Remuneration to the Executive Management	Viohalco	493,454	125,000	3,167	621,622
	Subsidiaries	2,047,268	-	-	2,047,268
	Total	2,540,722	125,000	3,167	2,668,889

Notes to Tables A & B:

(a) Base salary: this column includes the fixed base salary in exchange for professional services regarding their mandate or for any other executive or non-executive services or functions provided during the reported financial year under a specific contract.
(b) Fees: this column includes all fees of the members of the Board for the participation in the administrative, management or supervisory bodies of the Company’s meetings during the reported financial year.
(c) Other benefits: this column includes the value of any benefits and perquisites, such as non-business or non-assignment related travel, medical, car, residence or housing, credit cards, and other benefits in kind.

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Evolution of the Remuneration

The following table (C) provides an overview of the evolution over the five most recent financial years of the overall remuneration of the members of the Board of directors and the members of the Executive Management, and the performance of the Company through the reporting of some of its KPIs.

Table C* (Amounts in EUR)

	2021**	2020	2019	2018	2017
Remuneration of the members of the Board of directors and the Executive Management	5,430,003	5,651,680	4,869,806	4,535,405	3,678,809
Performance of the Company
EBITDA	514,285,403	285,339,931	273,374,327	331,857,157	302,545,754
a-EBITDA	426,017,098	294,462,579	302,473,034	317,024,722	284,207,150
Revenue	5,374,512,326	3,850,077,328	4,198,193,708	4,406,185,353	3,721,310,855

* The information is provided on the basis of the available information from previous remuneration reports and the Company’s annual accounts.## ■ External audit

The statutory auditor, appointed by the Shareholders’ Meeting among the members of the Belgian Institute of Certified Auditors, is entrusted with the external audit of the Company’s consolidated financial statements. The statutory auditors’ mission and powers are those defined by the law. The Shareholders’ Meeting sets the number of statutory auditors and determines their remuneration in compliance with the law. The statutory auditor is appointed for a renewable term of three years. On May 29, 2019, the Company appointed PwC Reviseurs d’Entreprises SRL/ Bedrijfsrevisoren BV), in abbreviation PwC Reviseurs d’Entreprises, represented by Marc Daelman, as statutory auditor for a three-year period.

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■ Company’s risk management and internal audit function

The Belgian legislative and regulatory framework on risk management and internal control is set out in the law of 17 December 2008 on the establishment of an audit committee, and the law of 6 April 2010 on the enhancement of corporate governance, as well as in the 2020 Code. As mentioned in the chapter “Risks and Uncertainties” of this annual report, the Executive Management is responsible for the risk management and the system of internal control. Under the high supervision of the Executive Management, the management team of each Company’s subsidiary is responsible for developing an adequate organisation and an appropriate system of internal control for running the subsidiary’s operations and managing risk. The Audit Committee is responsible for monitoring the effectiveness of the Company’s risk management, its system of internal control and its internal audit function.

- Risk management

Risk management is a responsibility of the Management of the subsidiaries. The management team of the subsidiaries reports on business risks and challenges to the Company’s Executive Management on a regular basis; they provide the Board and the Audit Committee with a detailed business review which analyses risks and challenges. The Internal Audit, under the supervision of the Audit Committee, ensures the monitoring and the effectiveness of their risk management systems.

- Internal audit function

The Audit Committee supervises the internal audit function. Internal audit is an independent, objective assurance and consulting activity designed to add value and improve the organization's operations. It helps the organization accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control, and governance processes. Internal audit is conducted in accordance with the International Standards for the Professional Practice of Internal Auditing (IPPF). The internal audit function is responsible for performing audit engagements in accordance with its annual internal audit plan, which is prepared and reviewed in order to assist the organisation to effectively mitigate risk throughout its operations. The audit engagements follow the audit methodology described in the internal audit charter and the internal audit manual as well as aim at ensuring that subsidiaries comply with shared services processes with regards to their operations, industrial production and consolidation guidelines. At the end of each audit engagement, the internal audit function issues an audit report containing its audit findings and recommendations. The subsidiaries’ management team is responsible to design and implement remedial actions towards each of the internal audit findings and recommendations in due time. The internal audit function reports to the Audit Committee. The Audit Committee ensures that the internal audit work is focused on the activities and the risk areas it deems critical. It ensures that the internal audit function reduces the probability of fraud and error and provides effective mitigation of risk.

■ Control and relationship with subsidiaries

Viohalco is a holding company that operates in a decentralised manner. Each of Viohalco companies is responsible for its performance and results. The management team of the subsidiaries is organised around solid global and regional teams, with responsibility assigned to the members of their respective Boards of directors and executive management team. In order to secure consistency of approach when separate companies deal with similar issues, and to optimise coordination throughout the network of the Company’s subsidiaries, the local management of the companies is provided with solid guidance and a workable framework for optimal local implementation and monitoring. Steelmet, a Viohalco subsidiary, is assigned by a subcontracting agreement with the functional support towards all companies of Viohalco. It deploys a team of subject matter experts who oversee policy implementation, monitor performance, and promote best practices while ensuring decentralization and entrepreneurial independence of the business units. The support they provide relates, among others, to functions such as finance, investor relations, ESG, Internal Audit, Operations etc. A shared services center is also responsible for the execution of common corporate services such as procurement, transportation, information technology and accounting. All Viohalco’s companies are accountable for their own organisation, risk management and system of internal control as these are developed and implemented depending on the business segment, the geographical location and the type of production plant concerned.

■ Financial reporting and monitoring

Viohalco has established procedures for the adequate recording and reporting of financial and non-financial information. The objective is to ensure that financial and non-financial information produced by each entity is homogeneous, coherent, and comparable, and that consolidated financial information is fair, reliable, and can be obtained in a timely manner. Each subsidiary reports financial information on a monthly basis. This includes the balance sheet, the income statement, the statement of cash flows, and a working capital analysis. A review of each business segment is presented to the Board. The review includes “actual versus budget”, financial and non-financial information, the highlights of the reporting period, the business segment perspectives, and is a key component of Viohalco’s decision-making process.

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■ Conflict of interests

Pursuant to Article 9 of the Charter, in the event a conflict of interests with a member of the Board, a shareholder, or other Viohalco subsidiary, may arise, the Board is required to implement the specific procedures of conflict resolution set forth in articles 7:96 and 7:97 of the BCCA. Each member of the Board and the Executive Management is required to always act without conflict of interests and always put the interest of Viohalco before his individual interest. Each member of the Board and the Executive Management is required to always arrange his or her personal business so as to avoid direct and indirect conflict of interests with Viohalco. All members of the Board are required to inform the Board of conflicts of interests as they arise. If the conflict of interests is of proprietary nature, they will abstain from participating in the discussions and deliberations on the matter involved in accordance with article 7:96 of the BCCA. If the conflict of interests is not covered by the provisions of the BCCA and involves a transaction or contractual relationship between Viohalco or one of its related entities, on the one hand, and any member of the Board or the Executive Management (or a company or entity with which such member of the Board or the Executive Management has a close relationship), on the other hand, such member will inform the Board of the conflict. The Board is under the obligation to check that the approval of the transaction is motivated by Viohalco’s interest only and that it takes place at arm’s length. In all cases involving a conflict of interests not covered by article 7:96 of the BCCA, the member of the Board affected by the conflict of interests is required to judge whether he or she should abstain from participating in the discussions and the vote. Since the listing of the Company, the Board has not been notified of any transaction or other contractual relationship between Viohalco and its Board members which caused a conflict of interests within the meaning of articles 7:96 and 7:97 of the BCCA.

■ Shareholders

1. Capital structure

On December 31, 2021, the Company’s share capital amounted to EUR 141,893,811.46 represented by 259,189,761 shares without nominal value. There is no authorised share capital. All shares of the Company belong to the same class of securities and are in registered or dematerialised form. Shareholders may select, at any time, to have their registered shares converted into dematerialised shares and vice versa. Share transfers are not restricted in the Company’s articles of association; all Company’s shares are freely transferable. Each share entitles the holder to one voting right.

2.# VIOHALCO | ANNUAL REPORT 2021 102

Shareholders’ meeting

1. Meetings

The Annual Ordinary Shareholders’ Meeting of the Company is held on the last Tuesday of May at 12:00 p.m. or, if the day is a public holiday in Belgium, on the previous business day, at the same time. It takes place in Brussels, at the registered office of the Company or at a place indicated in the convening notice of the Shareholders’ Meeting. The other Shareholders' Meetings of the Company must take place on the date, hour and place indicated in the convening notice of the Shareholders’ Meeting. They may take place in locations other than the Company’s registered office. The Annual, the Special and Extraordinary Shareholders' Meetings of the Company may be convened by the Board or by the statutory auditor of the Company, or at the request of shareholders representing at least ten (10)% of the Company's share capital.

2. Quorum and majority required for modification of the articles of association

The modification of Viohalco’s articles of association requires that two thirds (2/3) of the share capital are present or represented, and that it is approved by a qualified majority of 75% of the votes cast. If the quorum of two thirds is not reached during a first Shareholders’ Meeting, a second Meeting can be convened with the same agenda and shall lawfully meet if 60% of the Company’s share capital is present or represented. If this second Meeting quorum is not reached, a third Meeting can be convened and shall lawfully meet if 58% of the Company’s share capital is present or represented.

Share information and evolution of the shares

The share capital of Viohalco is set at EUR 141,893,811.46 and is divided into 259,189,761 shares without nominal value. The shares have been issued in registered and dematerialised form. All the shares are freely transferable and fully paid up. The Company has not issued any other category of shares, such as non-voting or preferential shares. All the shares representing the share capital have the same rights. In accordance with the articles of association of the Company, each share entitles its holder to one vote. Viohalco’s shares are listed under the symbol “VIO” with ISIN code BE0974271034 on the regulated market of Euronext Brussels and on the main market of the Athens Stock Exchange (Athex) with the same ISIN code and under the symbol “VIO” (in latin characters) and “BIO” (in Greek characters).

Market data

The table below sets forth, for the periods indicated the maximum and minimum year-end closing prices, and the end of the year closing prices of Viohalco S.A. on Euronext Brussels and Athens Stock Exchange.

Share price EURONEXT BRUSSELS in EUR	2021	2020
At the end of the year	4.59	3.71
Maximum	5.30	3.98
Minimum	3.23	1.54

Share price ATHENS EXCHANGE in EUR	2021	2020
At the end of the year	4.59	3.74
Maximum	5.19	3.99
Minimum	3.32	1.52

Investor relations contact details

Sofia Zairi
Chief Investor Relations Officer
Email: ir@viohalco.com

Viohalco S.A. | Viohalco S.A. – Greek Branch
30 Marnix Avenue, | 16 Himaras Street,
1000 Brussels, | 151 25 Maroussi, Athens
Belgium | Greece
tel: (+32) 2 224 09 11 | tel: Greece tel: (+30) 210 6861 111, (+30) 210 6787 773

www.viohalco.com

Market	NYSE Euronext Brussels	Athens Stock Exchange
Ticker	VIO	VIO (in latin characters) and BIO (in Greek characters)
ISIN code	BE0974271034	BE0974271034

Viohalco remains committed to high-quality and transparent financial reporting. Viohalco’s consolidated financial statements have been prepared in accordance with International Financial Reporting Standards as adopted by the EU (“IFRSs as adopted by the EU”).

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Shareholding structure

According to the last transparency notifications, the shareholding structure of Viohalco is as follows:

Name (Shareholders)	% voting rights
Ippokratis Ioannis Stassinopoulos	30.31%
(7.05% exercised in his own name and 23.25% exercised in the name and on behalf of KIKPE Foundation in his capacity as President of the KIKPE Foundation’s Board)
Nikolaos Stassinopoulos	27.43%
Evangelos Stassinopoulos	19.20%
Michail Stassinopoulos	7.01%

Distribution and dividend policy

As a holding company with majority participations in industrial and commercial companies, Viohalco’s dividend policy depends on the ability of these companies to generate profit and cash flows sufficient to secure capital invested, to support growth and long-term sustainability and pay dividends. As a matter of corporate policy, and based on careful evaluation of each year’s financial results and of the wider economic and business context, the Company assesses whether it is sounder to re-invest the totality or part of the annual profits and dividends received into the operating companies’ businesses or to pay dividends to its shareholders. The Company can give no assurance that it will make any dividend payment, for any given year in the near or distant future. Such payment will always be conditional on the complex interplay of a broad number of factors, which include Viohalco’s overall strategy and business prospects, evolution of earnings, capital requirements and surplus, general financial conditions, existing contractual restrictions, as well as other factors which the Board of Directors may each time deem relevant.

Financial calendar

Date	Event
Friday, March 18, 2022	Financial results 2021 conference call for investors and analysts
Wednesday, April 20, 2022	Publication of Annual Report 2021
Tuesday, May 31, 2022	Ordinary General Shareholders’ Meeting 2022
Friday, June 3, 2022	Ex-Dividend date of fiscal year 2021
Monday, June 6, 2022	Dividend beneficiaries of fiscal year 2021 - Record date (The shares will trade ex-dividend before June 17, 2022, which is the expiration day of Futures Contracts (June series) in the Athens Stock Exchange and before July 15, 2022, which is the expiration date for the Futures Contracts on the FTSE/ATHEX Large Cap index)
Tuesday, June 7, 2022	Dividend payment of fiscal year 2021
Thursday, September 22, 2022	Half yearly 2022 results

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VIOHALCO | ANNUAL REPORT 2021 106

J. Appendix – Alternative Performance Measures (APMs)

Introduction

Viohalco management has adopted, monitors and reports internally and externally P&L alternative performance measures (‘APMs’), namely EBITDA, EBIT, adjusted EBITDA (a-EBITDA) and adjusted EBIT (a-EBIT) on the basis that they are appropriate measures reflecting the underlying performance of the business.## K. EU Taxonomy Reporting Principles

Allocation of turnover, Capex and Opex to one environmental objective

Viohalco is particularly concerned by the objective of climate change mitigation. It was determined that activities 3.1, 3.8, 3.9 & 4.9 should be allocated to climate change mitigation, as this objective is more pertinent to Viohalco’s activities and the Taxonomy does not allow double counting using other objectives.

Relevant judgement on the Taxonomy-eligibility of our activities

Activity 3.1 - Manufacture of renewable energy technologies

The description of activity 3.1 in Annex I to the Climate Delegated Act does not contain a clear definition of the term "renewable energy technologies" and is thus open to interpretation. In the absence of a “renewable energy technologies” definition and in the spirit of the EU Taxonomy, we defined this term by referring to the technical screening criteria for substantial contribution to climate change mitigation.

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Reconciliation tables

EBIT and EBITDA

Steel	Real estate	Other	2021	Aluminium	Copper	Cables	pipes	Total
(Amounts in EUR thousands)
EBT (as reported in Statement of Profit or Loss)	59,556	58,979	45,754	-15,407	108,943	15,347	2,813	275,984
Adjustments for:
Share of profit/loss (-) of Associates	-1,180	4,069	0	-386	-318	344	0	2,530
Net Finance Cost	20,858	14,624	21,874	7,488	26,091	3,452	1,494	95,882
EBIT	79,234	77,672	67,629	-8,305	134,716	19,144	4,307	374,396
Add back: Depreciation & Amortization	59,093	16,665	16,659	8,861	25,600	8,777	4,234	139,889
EBITDA	138,327	94,338	84,287	555	160,316	27,921	8,541	514,285

Steel	Real estate	Other	2020*	Aluminium	Copper	Cables	pipes	Total
(Amounts in EUR thousands)
EBT (as reported in Statement of Profit or Loss)	21,529	16,000	35,549	1,575	-24,776	10,511	-1,114	59,273
Adjustments for:
Share of profit/loss (-) of Associates	-511	2,271	0	67	-86	0	0	1,740
Net Finance Cost	14,881	14,143	21,380	10,609	25,687	3,952	1,655	92,307
EBIT	35,899	32,413	56,929	12,251	826	14,463	540	153,321
Add back: Depreciation & Amortization	53,976	15,268	15,117	8,855	29,091	5,946	3,767	132,019
EBITDA	89,875	47,680	72,046	21,106	29,917	20,409	4,308	285,340

• The comparative information is restated due to retroactive application of the IFRIC Agenda Decision “Attributing Benefit to Periods of Service”.

a-EBIT and a-EBITDA

Steel	Real estate	Other	2021	Aluminium	Copper	Cables	pipes	Total
(Amounts in EUR thousands)
EBT (as reported in Statement of Profit or Loss)	59,556	58,979	45,754	-15,407	108,943	15,347	2,813	275,984
Adjustments for:
Net finance cost	20,858	14,624	21,874	7,488	26,091	3,452	1,494	95,882
Metal price lag	-19,694	-35,193	4,915	0	-37,746	0	0	-87,718
Share of profit(-)/ loss of equity investees, net of tax	-1,180	4,069	0	-386	-318	344	0	2,530
Impairment/ Reversal of Impairment (-)of PP&E, intangibles and inv. property	2,067	0	0	0	0	-18,149	507	-15,575
Gains (-) /losses from sales of PP&E, intangibles and inv. property	524	-187	-24	0	-13	-491	-114	-306
Gains(-)/losses from sales of investments	0	0	0	0	0	0	21	21
Exceptional litigation fees and fines / income (-)	0	0	0	0	0	0	41	41
Provision for antidumping duties	0	0	0	12,842	0	0	0	12,842
Reorganization costs	0	0	0	978	0	0	0	978
Incremental coronavirus costs (1)	1,285	1,508	445	-234	1,096	-2,663	12	1,449
a-EBIT	63,415	43,800	72,964	5,280	98,054	-2,159	4,774	286,128
Add back: Depreciation & Amortization	59,093	16,665	16,659	8,861	25,600	8,777	4,234	139,889
a-EBITDA	122,508	60,465	89,623	14,141	123,654	6,618	9,008	426,017

Steel	Real estate	Other	2020*	Aluminium	Copper	Cables	pipes	Total
(Amounts in EUR thousands)
EBT (as reported in Statement of Profit or Loss)	21,529	16,000	35,549	1,575	-24,776	10,511	-1,114	59,273
Adjustments for:
Net finance cost	14,881	14,143	21,380	10,609	25,687	3,952	1,655	92,307
Metal price lag	3,908	4,311	8,086	0	1,277	0	0	17,581
Share of profit/ loss(-) of equity investees, net of tax	-511	2,271	0	67	-86	0	0	1,740
Impairment/ Reversal of Impairment (-) on fixed assets	-164	561	0	0	0	-13,782	0	-13,386
Gains (-) /losses from sales of fixed assets and intangibles	349	-1,567	-6	0	-1,133	-8	-842	-3,208
Exceptional litigation fees and fines / income (-)	0	0	0	0	195	0	0	195
Reorganization costs	0	0	0	447	2,341	0	0	2,788
Incremental coronavirus costs (1)	1,000	1,099	1,370	467	1,008	-108	0	4,837
Other exceptional or unusual income (-) /expenses	0	0	0	0	0	0	315	315
a-EBIT	40,992	36,817	66,379	13,165	4,512	565	13	162,443
Add back: Depreciation & Amortization	53,976	15,268	15,117	8,855	29,091	5,946	3,767	132,019
a-EBITDA	94,968	52,084	81,495	22,020	33,603	6,511	3,781	294,463

• The comparative information is restated due to retroactive application of the IFRIC Agenda Decision “Attributing Benefit to Periods of Service”.

(1) Incremental coronavirus costs concern all incremental costs incurred due to the coronavirus outbreak. Such costs are directly attributable to the coronavirus outbreak and are incremental to costs incurred prior to the outbreak and not expected to recur once the crisis has subsided and operations return to normal, while they are clearly separable from normal operations.

---

Segmental Information

Steel	Real estate	Other	2021	Aluminium	Copper	Cables	pipes	Total
Revenue	1,677,918	1,563,775	757,170	225,067	1,067,782	18,667	64,134	5,374,512
Gross profit	147,873	125,054	94,442	15,157	181,255	3,555	23,310	590,645
Operating profit	79,234	77,672	67,629	-8,305	134,716	19,144	4,307	374,396
Net finance cost	-20,858	-14,624	-21,874	-7,488	-26,091	-3,452	-1,494	-95,882
Share of profit/loss (-) of equity investees	1,180	-4,069	0	386	318	-344	0	-2,530
Profit/Loss (-) before tax	59,556	58,979	45,754	-15,407	108,943	15,347	2,813	275,984
Income tax	-10,762	-9,052	-7,788	-451	-20,053	-399	-7,490	-55,996
Profit/Loss (-)	48,793	49,927	37,966	-15,859	88,891	14,948	-4,678	219,989

Steel	Real estate	Other	2020*	Aluminium	Copper	Cables	pipes	Total
Revenue	1,167,735	1,066,014	568,615	304,824	677,939	10,041	54,909	3,850,077
Gross profit	100,469	73,940	81,605	24,695	46,096	2,481	19,757	349,043
Operating profit	35,899	32,413	56,929	12,251	826	14,463	540	153,321
Net finance cost	-14,881	-14,143	-21,380	-10,609	-25,687	-3,952	-1,655	-92,307
Share of profit/loss (-) of equity investees	511	-2,271	0	-67	86	0	0	-1,740
Profit/Loss (-) before tax	21,529	16,000	35,549	1,575	-24,776	10,511	-1,114	59,273
Income tax	-8,292	-3,622	-8,911	-1,854	428	-1,952	-2,300	-26,502
Profit/Loss (-)	13,237	12,378	26,638	-279	-24,348	8,559	-3,414	32,771

• The comparative information is restated due to retroactive application of the IFRIC Agenda Decision ‘Attributing Benefit to Periods of Service’.

---

Net Debt

Amounts in EUR thousands

	As at 31 December 2021	As at 31 December 2020
Long term Loans & borrowings	1,294,093	1,001,986
Lease liabilities	34,639	41,276
Short term Loans & borrowings	848,145	746,010
Lease liabilities	10,696	10,935
Total Debt	2,187,573	1,800,207
Less: Cash and cash equivalents	-503,267	-219,161
Net Debt	1,684,306	1,581,046

Activity 3.8 - Secondary aluminium production

The description of activity 3.8 in Annex I to the Climate Delegated Act does not contain a clear definition of the term "secondary aluminium" and is thus open to interpretation. In the absence of a “secondary aluminium” definition and in the spirit of the EU Taxonomy, we defined this term by referring to the technical screening criteria for substantial contribution to climate change mitigation. We thus included revenue generated from materials produced as a result of aluminium remelting process, since none of the Viohalco subsidiaries’ activities include primary aluminium production.

Activity 3.9 - Manufacture of iron and steel

According to the description of activity 3.9 in Annex I to the Climate Delegated Act an economic activity should comply with at least one of the following technical screening criteria:

a. iron and steel where GHG emissions, reduced by the amount of emissions assigned to the production of waste gases in accordance with point 10.1.5(a) of Annex VII to Regulation (EU) 2019/331 do not exceed the following values applied to the different manufacturing process steps:
i. hot metal = 1,331 tCO2e/t product;
ii. sintered ore = 0,163 tCO2e/t product;
iii. coke (excluding lignite coke) = 0,144 tCO2e/t product;
iv. iron casting = 0,299 tCO2e/t product;
v. electric Arc Furnace (EAF) high alloy steel = 0,266 tCO2e/t product;
vi. electric Arc Furnace (EAF) carbon steel = 0,209 tCO2e/t product.
b. steel in electric arc furnaces (EAFs) producing EAF carbon steel or EAF high alloy steel, as defined in Commission Delegated Regulation (EU) 2019/331 and where the steel scrap input relative to product output is not lower than:
i. 70 % for the production of high alloy steel;
ii. 90 % for the production of carbon steel.

According to our assessment the steel segment revenue complies with the above mentioned technical criteria of paragraph b as the steel making process of Viohalco subsidiaries are based on secondary production of steel using steel scrap in excess of 90% input.

Activity 4.9 - Construction and Installation services of electricity distribution networks

According to the description of activity 4.9 in Annex I to the Climate Delegated Act an economic activity should comply with at least one of the following technical screening criteria:

c. the system is the interconnected European system, i.e. the interconnected control areas of Member States, Norway, Switzerland and the United Kingdom, and its subordinated systems;
d. more than 67% of newly enabled generation capacity in the system is below the generation threshold value of 100 gCO2e/kWh measured on a life cycle basis in accordance with electricity generation criteria, over a rolling five-year period;
e. the average system grid emissions factor, calculated as the total annual emissions from power generation connected to the system, divided by the total annual net electricity production in that system, is below the threshold value of 100 gCO2e/kWh measured on a life cycle basis in accordance with electricity generation criteria, over a rolling five-year period;

According to our assessment the cables segment revenue generated from projects relating to the interconnection of islands complies with the above mentioned technical criteria a.

Taxonomy-non-eligible economic activities

The activities that have not been identified as Taxonomy eligible, and which therefore comprise the Taxonomy non-eligible %, are currently not included among the sectors and activities included in the EU Taxonomy; however, they could be included in the activities envisaged in the additional four environmental objectives identified in the Regulation that are currently being standardised.

VIOHALCO | ANNUAL REPORT 2021 111

Taxonomy-eligible Capex and Opex and individually Taxonomy- eligible Capex and Opex

With regard to Capex and Opex related to our Taxonomy-eligible economic activities and Capex/Opex related to purchases and measures that we consider as individually Taxonomy-eligible, we refer to the explanations in the sections “Capex KPI” and “Opex KPI” in the description of our accounting policies.

KPIs and accounting policies

Reporting requirements include the eligibility percentage of the Turnover, CAPEX and OPEX for the companies that are already included in the Sustainable Finance E.U. law. Article 10(1) of the Disclosures Delegated Act explicitly requires that in the first year of implementation, non-financial undertakings should disclose "the proportion of Taxonomy-eligible and Taxonomy non-eligible economic activities in their total turnover, capital and operating expenditure".

Turnover KPI

Definition
The proportion of Taxonomy-eligible economic activities has been calculated as the part of turnover derived from the economic activities presented below (numerator):
* 3.1 Manufacture of renewable energy technologies
* 4.9 Transmission and distribution of electricity
* 3.8 Secondary aluminium production
* 3.9 Manufacture of iron and steel

divided by the turnover of Viohalco’s total turnover (denominator) for financial year 2021. For further details on our turnover accounting policy please refer to page 125 of our Annual Report 2021.

Reconciliation
Turnover of Viohalco can be reconciled to our consolidated financial statements, in “Operating segments” section, on page 140 of our Annual Report 2021.

Capex KPI

Definition
The Capex KPI is defined as Taxonomy-eligible Capex (numerator) divided by Viohalco’s total Capex (denominator). The numerator consists of Taxonomy-eligible Capex related to assets or processes that are associated with the economic activities presented below (numerator):
* 3.1 Manufacture of renewable energy technologies
* 4.9 Transmission and distribution of electricity
* 3.8 Secondary aluminium production
* 3.9 Manufacture of iron and steel

We consider that assets and processes are associated with Taxonomy- eligible economic activities when they are essential components necessary to execute an economic activity. Consequently, all Capex invested into machinery for the above mentioned activities have been included in the numerator of the Capex KPI. In particular, secondary aluminium Capex includes Capex related to the production of aluminium from secondary raw materials (including scrap and metal-bearing materials) and the remelting and alloying processes.

The denominator consists of Viohalco companies additions to tangible and intangible fixed assets during financial year 2021, before depreciation, amortisation and any re-measurements, including those resulting from revaluations and impairments. It includes acquisitions of tangible fixed assets (IAS 16), intangible fixed assets (IAS 38) and investment properties (IAS 40). Additions resulting from business combinations are also included. Goodwill is not included in Capex, as it is not defined as an intangible asset in accordance with IAS 38. For further details on our accounting policies regarding Capex please refer to page 128 of our Annual Report 2021.

Reconciliation
Capex of Viohalco can be reconciled to our consolidated financial statements, in “Operating segments” section, on page 140 of our Annual Report 2021.

Opex KPI

Definition
The Opex KPI is defined as Taxonomy-eligible Opex (numerator) divided by total Viohalco’s total Opex (denominator). The numerator consists of Taxonomy-eligible Opex related to assets or processes that are associated with the economic activities presented below (numerator):
* 3.1 Manufacture of renewable energy technologies
* 4.9 Transmission and distribution of electricity
* 3.8 Secondary aluminium production
* 3.9 Manufacture of iron and steel

Total Opex (denominator) consists of direct non-capitalised costs that relate to research and development, building renovation measures, short-term lease, maintenance and repair, and any other direct expenditures relating to the day-to-day servicing of assets of property, plant and equipment. This includes:
* Research and development expenditure recognised as an expense during the reporting period. This includes all non-capitalised expenditure that is directly attributable to research or development activities.

VIOHALCO | ANNUAL REPORT 2021 112
* The volume of non-capitalised leases was determined in accordance with IFRS 16 and includes expenses for short-term leases and low-value leases.
* Maintenance and repair and other direct expenditures relating to the day-to-day servicing of assets of property, plant and equipment were determined based on the maintenance and repair costs allocated to our internal cost centers. The related cost items constitute a portion of total operating expenses in the income statement. This also includes building renovation measures. In general, this includes staff costs, costs for services, and material costs for daily servicing as well as for regular and unplanned maintenance and repair measures. These costs are directly allocated to our PP&E including an appropriate allocation of overhead costs. This does not include expenditures relating to the day-to-day operation of PP&E such as raw materials, cost of employees operating the machine, electricity or fluids that are necessary to operate PP&E.

Direct costs for training and other human resources adaptation needs are excluded from the denominator and the numerator. This is because Annex I to Art. 8 Delegated Act lists these costs only for the numerator which does not allow a mathematically meaningful calculation of the Opex KPI.

This section is included for the first time in the section “Non- Financial Reporting”, pursuant to Regulation (EU) 2020/852. The information contained follows the requirements of the Regulation.# Viohalco | Annual Report 2021

L. Consolidated Financial Statements 2021

VIOHALCO | ANNUAL REPORT 2021 116

Contents

• Consolidated Statement of Financial Position 118
• Consolidated Statement of Profit or Loss 119
• Consolidated Statement of Other Comprehensive Income 120
• Consolidated Statement of Changes in Equity 121
• Consolidated Statement of Cash Flows 122
• Notes to the Consolidated Financial Statements 123
  1. Reporting entity 123
  2. Basis of accounting 123
  3. Functional currency and presentation currency 123
  4. Use of estimates and judgements 123
  5. Significant accounting policies 124
  6. Operating segments 139
  7. Revenue 142
  8. Other income and expenses 145
  9. Net finance cost 146
  10. Earnings per share 147
  11. Employee benefits 147
  12. Employee benefit expenses 149
  13. Income tax expense 150
  14. Inventories 153
  15. Trade and other receivables 153
  16. Cash and cash equivalents 154
  17. Property, plant and equipment 155
  18. Goodwill and intangible assets 157
  19. Investment property 160
  20. Equity-accounted investees 161
  21. Other investments 163
  22. Assets held for sale 163
  23. Derivatives 163
  24. Capital and reserves 165
  25. Capital management 166
  26. Loans and borrowings 166
  27. Trade and other payables 169
  28. Grants 169
  29. Provisions 169
  30. Financial instruments 170
  31. Impact of Covid-19 pandemic 179
  32. Subsidiaries 180
  33. Joint operations 182
  34. Non-controlling interests 182
  35. Leases 184
  36. Commitments 185
  37. Contingent liabilities 185
  38. Related parties 186
  39. Auditor’s fees 187
  40. Subsequent events 188

VIOHALCO | ANNUAL REPORT 2021 118

Consolidated Statement of Financial Position

As at

Amounts in EUR thousands

	Note	31 December 2021	31 December 2020*
ASSETS
Property, plant and equipment	17	2,089,107	1,954,096
Right of use assets	35	34,288	38,498
Intangible assets and goodwill	18	42,083	39,545
Investment property	19	280,876	270,413
Equity-accounted investees	20	44,372	38,089
Other investments	21	8,457	8,324
Deferred tax assets	13	13,141	17,206
Derivatives	23	944	936
Trade and other receivables	15	7,314	10,349
Contract costs	7	222	222
Non-current assets		2,520,805	2,377,678
Inventories	14	1,469,840	1,074,589
Trade and other receivables	15	623,536	447,459
Contract assets	7	101,371	68,517
Contract costs	7	167	491
Derivatives	23	16,277	7,225
Assets held for sale	22	372	730
Current tax assets		2,785	1,663
Cash and cash equivalents	16	503,267	219,161
Current assets		2,717,616	1,819,835
Total assets		5,238,420	4,197,513
EQUITY
Share capital	24	141,894	141,894
Share premium	24	457,571	457,571
Translation reserve	24	-24,450	-30,341
Other reserves	24	440,437	436,104
Retained earnings		399,175	214,097
Equity attributable to owners of the Company		1,414,626	1,219,324
Non-controlling interests	34	240,969	175,929
Total equity		1,655,594	1,395,253
LIABILITIES
Loans and borrowings	26	1,294,093	1,001,986
Lease liabilities	35	34,639	41,276
Derivatives	23	3,587	1,295
Deferred tax liabilities	13	97,263	91,258
Employee benefits	11	24,183	21,913
Grants	28	33,985	35,817
Provisions	29	1,825	1,839
Trade and other payables	27	17,615	12,299
Contract liabilities	7	9,889	9,889
Non-current liabilities		1,517,080	1,217,572
Loans and borrowings	26	848,145	746,010
Lease liabilities	35	10,696	10,935
Trade and other payables	27	1,093,804	762,998
Contract liabilities	7	51,482	44,132
Current tax liabilities		40,035	14,708
Derivatives	23	7,563	5,252
Provisions	29	14,020	652
Current liabilities		2,065,746	1,584,687
Total liabilities		3,582,826	2,802,260
Total equity and liabilities		5,238,420	4,197,513

* Restated figures due to the retrospective application of change in the method of attributing benefit to periods of service (IAS 19) (see Note 5.23)

The notes on pages 123 to 188 are an integral part of these Consolidated Financial Statements.

VIOHALCO | ANNUAL REPORT 2021 119

Consolidated Statement of Profit or Loss

For the year ended 31 December

Amounts in EUR thousands

	Note	2021	2020*
Revenue	7	5,374,512	3,850,077
Cost of sales		-4,783,867	-3,501,034
Gross profit		590,645	349,043
Other income	8	43,422	44,240
Selling and distribution expenses		-80,351	-76,001
Administrative expenses		-142,620	-132,928
Impairment loss on trade and other receivables, including contract assets		-2,698	-1,497
Other expenses		-34,003	-29,536
Operating result (EBIT)		374,396	153,321
Finance income	9	2,371	1,648
Finance cost	9	-98,253	-93,955
Net finance income / costs (-)		-95,882	-92,307
Share of profit/ loss (-) of equity-accounted investees, net of tax	20	-2,530	-1,740
Profit/Loss (-) before income tax expense		275,984	59,273
Income tax expense (-)	13	-55,996	-26,502
Profit/Loss (-)		219,989	32,771
Profit/Loss (-) attributable to:
Owners of the Company		194,994	21,377
Non-controlling interests		24,995	11,394
		219,989	32,771
Earnings per share (in EUR per share)	10
Basic and diluted		0.752	0.082

* Restated figures due to the retrospective application of change in the method of attributing benefit to periods of service (IAS 19) (see Note 5.23)

The notes on pages 123 to 188 are an integral part of these Consolidated Financial Statements.

VIOHALCO | ANNUAL REPORT 2021 120

Consolidated Statement of Other Comprehensive Income

For the year ended 31 December

Amounts in EUR thousands

	Note	2021	2020*
Profit / Loss (-)		219,989	32,771
Items that will never be reclassified to profit or loss:
Equity investments at FVOCI - net change in fair value	21	702	-518
Remeasurements of defined benefit liability	11	-1,063	-1,057
Related tax	13	222	175
Total		-139	-1,400
Items that are or may be reclassified to profit or loss
Foreign currency translation differences	30	7,731	-11,155
Changes in fair value of cash flow hedges – effective portion	30	4,839	2,174
Changes in fair value of cash flow hedges - reclassified to profit or loss	13	-1,713	1,857
Related tax		-447	-623
Total		10,409	-7,747
Other comprehensive income / expense (-) after tax		10,270	-9,147
Total comprehensive income / expense (-) after tax		230,259	23,624
Total comprehensive income attributable to
Owners of the Company		203,578	14,510
Non-controlling interests		26,681	9,114
Total comprehensive income / expense (-) after tax		230,259	23,624

* Restated figures due to the retrospective application of change in the method of attributing benefit to periods of service (IAS 19) (see Note 5.23)

The notes on pages 123 to 188 are an integral part of these Consolidated Financial Statements.

VIOHALCO | ANNUAL REPORT 2021 121

Consolidated Statement of Changes in Equity

2021

Amounts in EUR thousands

	Note	Share capital	Share premium	Other reserves	Translation reserve	Retained earnings	Total	Non-controlling interests	Total equity
Balance as at 1 January 2021		141,894	457,571	436,104	-30,341	214,097	1,219,325	175,929	1,395,253
Total comprehensive income
Profit/loss (-)		0	0	0	0	194,994	194,994	24,995	219,989
Other comprehensive income		0	0	2,985	5,880	-1,338	7,527	-100	7,427
Total comprehensive income		0	0	2,985	5,880	193,656	202,521	24,895	227,416
Transactions with owners of the Company
Capitalization of reserves		0	0	1,150	0	0	1,150	0	1,150
Loss of Control/Disposal of subsidiary	32-34	0	0	331	-133	0	200	-60	140
Dividends		0	0	0	0	-7,776	-7,776	0	-7,776
Total		0	0	481	-133	-7,776	-6,426	-60	-6,486
Changes in ownership interests:
Acquisition of NCI		0	0	0	0	0	0	4,620	4,620
Other changes in ownership interests		0	0	0	0	0	0	44,211	44,211
Balance as at 31 December 2021		141,894	457,571	440,437	-24,450	399,175	1,414,626	240,969	1,655,594

* Restated figures due to the retrospective application of change in the method of attributing benefit to periods of service (IAS 19) (see Note 5.23)

The notes on pages 123 to 188 are an integral part of these Consolidated Financial Statements.

VIOHALCO | ANNUAL REPORT 2021 121

Consolidated Statement of Changes in Equity (Continued)

2020*

Amounts in EUR thousands

	Note	Share capital	Share premium	Other reserves	Translation reserve	Retained earnings	Total	Non-controlling interests	Total equity
Balance as at 1 January 2020		141,894	457,571	426,607	-21,711	184,854	1,189,214	145,859	1,335,073
Impact of change in accounting policy		0	0	0	0	-2,690	-2,690	0	-2,690
Adjusted balance at 1 January 2020		141,894	457,571	426,607	-21,711	182,164	1,186,524	145,859	1,332,383
Total comprehensive income
Profit/loss (-)		0	0	0	0	21,377	21,377	11,394	32,771
Other comprehensive income		0	0	2,690	-8,629	-928	-6,867	0	-6,867
Total comprehensive income		0	0	2,690	-8,629	20,449	14,510	11,394	25,904
Transactions with owners of the Company
Capitalization of reserves		0	0	3,607	0	0	3,607	0	3,607
Share capital increase of subsidiary		0	0	3,271	0	0	3,271	0	3,271
Mergers & absorptions		0	0	-33	0	0	-33	0	-33
Loss of Control/Disposal of subsidiary	32-34	0	0	0	0	0	0	-2,592	-2,592
Dividends		0	0	0	0	-1,144	-1,144	0	-1,144
Total		0	0	6,845	0	-1,144	5,701	-2,592	3,109
Changes in ownership interests:
Acquisition of NCI		0	0	0	0	0	0	302	302
Other changes in ownership interests		0	0	0	0	0	0	-1,113	-1,113
Balance as at 31 December 2020		141,894	457,571	436,104	-30,341	201,469	1,205,297	151,748	1,357,045

* Restated figures due to the retrospective application of change in the method of attributing benefit to periods of service (IAS 19) (see Note 5.23)

The notes on pages 123 to 188 are an integral part of these Consolidated Financial Statements.

VIOHALCO | ANNUAL REPORT 2021 122

Consolidated Statement of Cash Flows

For the year ended 31 December

Amounts in EUR thousands

	Note	2021	2020*
Cash flows from operating activities
Profit/Loss (-)		219,989	32,771
Adjustments for:
Depreciation and amortization		322,892	228,983
Impairment losses		2,698	1,497
Gain/loss on disposal of property, plant and equipment		-5,248	-1,248
Share of profit/loss of equity-accounted investees, net of tax	20	2,530	1,740
Finance income	9	-2,371	-1,648
Finance cost	9	98,253	93,955
Income tax expense	13	55,996	26,502
Changes in working capital:
Decrease/(increase) in inventories		-395,251	-157,901
Decrease/(increase) in trade and other receivables and contract assets		-243,970	-117,133
Increase/(decrease) in trade and other payables and contract liabilities		331,838	144,967
Increase/(decrease) in provisions		-19	1,338
Increase/(decrease) in employee benefits		2,270	3,606
Increase/(decrease) in grants		-1,832	2,997
Net cash generated from/(used in) operating activities before interest and tax		722,106	285,010
Interest paid		-89,219	-87,128
Income taxes paid		-31,052	-11,925
Net cash generated from/(used in) operating activities		601,835	185,957
Cash flows from investing activities
Purchase of property, plant and equipment		-375,016	-249,219
Proceeds from sale of property, plant and equipment		30,264	6,496
Purchase of intangible assets		-7,814	-11,030
Investments in equity-accounted investees		-6,283	-1,740
Investments in other investments		6,587	-3,344
Loans granted		0	-1,000
Disposal of subsidiaries/businesses, net of cash disposed		7,847	0
Acquisition of subsidiaries/businesses, net of cash acquired		-7,947	0
Net cash generated from/(used in) investing activities		-335,262	-259,837
Cash flows from financing activities
Proceeds from loans and borrowings		371,602	168,315
Repayment of loans and borrowings		-212,806	-160,173
Repayment of lease liabilities		-46,802	-41,047
Dividends paid to owners of the Company		-7,776	-1,144
Dividends paid to non-controlling interests		-3,421	-1,083
Capital contribution from non-controlling interests		44,211	302
Repayment of capital contribution from non-controlling interests		0	-1,113
Net cash generated from/(used in) financing activities		69,408	-36,830
Net increase/(decrease) in cash and cash equivalents		335,981	-110,703
Cash and cash equivalents at beginning of year		219,161	333,138
Effect of exchange rate changes on cash and cash equivalents		-5,031	-12,572
Cash and cash equivalents at end of year	16	549,111	219,161

* Restated figures due to the retrospective application of change in the method of attributing benefit to periods of service (IAS 19) (see Note 5.23)

The notes on pages 123 to 188 are an integral part of these Consolidated Financial Statements.# Consolidated Statements of Cash Flows

Cash ows from operating activities
Prot / loss (-) for the period		219,989
Adjustments for:
Income tax expense/ credit (-)		55,996
Depreciation of PP&E		120,686
Depreciation of right of use assets		8,518
Depreciation of intangible assets		6,673
Depreciation of investment property		6,898
Impairment loss/ Reversal of impairment loss (-) and write o of PP&E and intangible assets		-6,725
Impairment loss/ Reversal of impairment loss (-) of investment property		-6,922
Prot (-) / loss from sale of PP&E and intangible assets		170
Prot (-) / loss from sale of investment property		-476
Amortization of grants		-2,886
Finance cost		98,253
Finance income		-2,371
Impairment loss on trade and other receivables, including contract assets		2,698
Prot (-) / loss from derivatives valuation		-644
Gain (-) / loss from business combinations		21
Share of prot of equity accounted investees		2,530
Decrease / increase (-) in inventories		502,407
Decrease / increase (-) in receivables		-395,251
Decrease / increase (-) in contract assets		-227,609
Decrease / increase (-) in contract costs		-32,854
Decrease (-) / increase in liabilities		324
Decrease (-) / increase in employees benets liability		367,284
Decrease (-) / increase in provisions		1,208
Decrease (-) / Increase in contract liabilities		13,355
Interest charges and related expenses paid		7,350
Income tax paid		-266,193
Net cash ows from operating activities		-91,512
Cash ows from investing activities		-14,106
Acquisition of PP&E and intangible assets		130,596
Acquisition of investment property		-234,689
Proceeds from sales of PP&E and intangible assets		-13,065
Proceeds from sales of investment property		2,927
Acquisition of / share capital increase of associates and joint ventures		1,229
Acquisition of other investments		-9,525
Proceeds from sale of other investments		-77
Interest received		637
Dividends received		557
Cash inows / outows (-) from business combinations		1,060
Net cash ows used in investing activities		0
Cash ows from nancing activities		-250,947
Proceeds from new borrowings		896,672
Repayment of borrowings		-514,171
Principal elements of lease payments		-11,562
Proceeds from sales of subsidiaries shares		50,000
Proceeds from collection of grants		1,529
Acquisition of NCI		-7,500
Dividends paid to shareholders		-7,776
Dividends paid to non-controlling interest		-3,421
Net cash ows from/used in (-) nancing activities		403,773
Net decrease (-)/ increase in cash and cash equivalents		283,422
Cash and cash equivalents at the beginning of period		219,161
Foreign exchange eect on cash and cash equivalents		684
Cash and cash equivalents at the end of period		503,267

Notes to the Consolidated Financial Statements

1. Reporting entity

Viohalco S.A. (hereafter referred to as “the Company” or “Viohalco S.A.”) is a Belgian Limited Liability Company. The Company’s registered oce is located at 30 Avenue Marnix, 1000 Brussels Belgium. The Company’s Consolidated Financial Statements include those of the Company and its subsidiaries (together referred to as“Viohalco”). Viohalco S.A. is the holding company and holds participations in approximately 100 subsidiaries, two of which are listed, one on Euronext Brussels and the other on Athens Stock Exchange. With production facilities in Greece, Bulgaria, Romania, North Macedonia and the United Kingdom, Viohalco companies specialise in the manufacture of steel, copper and aluminium products. In addition, Viohalco owns substantial real estate properties in Greece. Its shares are traded on Euronext Brussels (trading ticker “VIO”) and has since February 2014 its secondary listing on the Athens Stock exchange (trading ticker “ΒΙΟ”). The Company’s electronic address is www.viohalco.com, where the Consolidated Financial Statements have been posted.

2. Basis of accounting

Statement of compliance

The Consolidated Financial Statements have been prepared in accordance with the International Financial Reporting Standards (IFRS) as adopted by the European Union and authorized by the Company’s Board of Directors on 17 March 2022. Details of the Viohalco’s accounting policies are included in Note 5.

Basis of measurement

The Consolidated Financial Statements have been prepared in accordance with the historical cost principle, with the exception of the following assets and liabilities, which are measured on an alternative basis on each reporting date.

1. Derivative nancial instruments (fair value)
2. Other Investments - Equity instruments (fair value)
3. Net dened benet liability (present value of the obligation)
4. Provisions (present value of the expected future cash ows)

3. Functional currency and presentation currency

The functional and presentation currency of the parent Company is Euro. All amounts in the Consolidated Financial Statements are rounded to the nearest thousand, unless otherwise indicated. As such, due to rounding, gures shown as totals in certain tables may not be arithmetic aggregations of the gures that precede them.

4. Use of estimates and judgements

Preparing Financial Statements in line with IFRS requires that Management makes judgements, estimates and assumptions that aect the application of Viohalco’s accounting policies and the reported amounts of assets, liabilities, income and expenses. The actual results may dier from these estimates. Management’s estimates and judgements are reviewed on an ongoing basis. Revisions to estimates are recognised prospectively. Information about judgements, assumptions and estimation uncertainties that have signicant risk of resulting in a material adjustment in the year ended 31 December 2021 is included in the following notes:

• Note 8 – Revenue recognition;
• Note 12 – Measurement of dened benet obligations: key actuarial assumptions;
• Note 14 – Recognition of deferred tax assets: availability of future taxable prots against which carried forward tax losses can be used;
• Note 19 – Impairment loss test: key assumptions underlying recoverable amounts;
• Note 31 – Measurement of ECL allowance for trade receivables and contract assets: key assumptions in determining loss rates;

VIOHALCO | ANNUAL REPORT 2021 123

5. Signicant accounting policies

The accounting principles described below have been consistently applied to all periods presented in these Consolidated Financial Statements and have also been consistently applied by Viohalco and its companies (subsidiaries and equity accounted investees).

5.1. Basis of Consolidation

(a) Business combinations
Acquisition of subsidiaries is accounted for using the acquisition method on the acquisition date, i.e. the date on which control is transferred to Viohalco. To assess control, Viohalco takes into account substantive potential voting rights. Viohalco and its companies measure goodwill on the acquisition date as follows:

• the fair value of the consideration paid, plus
• the value of any non-controlling interests in the acquired subsidiary, less
• the fair value of identiable assets and liabilities assumed.

Any goodwill that arises is tested annually for impairment loss. Any gain on a bargain purchase is immediately recognized in the Consolidated Statement of Prot or Loss. Any expenses directly linked with acquisition are directly posted in the Consolidated Statement of Prot or Loss. Any contingent consideration is recognized at its fair value on the acquisition date.

(b) Subsidiaries
Subsidiaries are entities controlled by Viohalco. Viohalco controls an entity when it is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to aect those returns through its power over the entity. The nancial statements of the subsidiaries are included in the consolidated nancial statements from the date on which control commences, until the date on which control ceases.

(c) Non-controlling interests
NCI are measured at fair value or at their proportionate share of the acquiree’s identiable net assets at the date of acquisition. This measurement is done on an acquisition by acquisition basis. Changes in Viohalco’s interest in a subsidiary that do not result in a loss of control are accounted for as equity transactions.

(d) Loss of control
When Viohalco and its companies lose control over a subsidiary, they derecognise the assets and liabilities of the subsidiary and any related NCI and other components of equity. Any resulting gain or loss is recognised in prot or loss. Any interest retained in the former subsidiary is measured at fair value when control is lost.

(e) Interests in equity-accounted investees
Associates are those entities in which Viohalco has signicant inuence, but not control or joint control, over the nancial and operating policies. This is generally the case where Viohalco holds between 20% and 50% of the voting rights. Investments in associates are accounted for using the equity method of accounting, after initially being recognised at cost. Investments in joint arrangements are classied as either joint operations or joint ventures. The classication depends on the contractual rights and obligations of each investor, rather than the legal structure of the joint arrangement. Joint operations: Viohalco recognises its direct right to the assets, liabilities, revenues and expenses of joint operations and its share of any jointly held or incurred assets, liabilities, revenues and expenses. These have been incorporated in the nancial statements under the appropriate headings.# VIOHALCO | ANNUAL REPORT 2021 124

(f) Transactions eliminated on consolidation

Intra group balances and transactions and any unrealised income and expenses arising from intra group transactions are eliminated. Unrealized gains arising from transactions with equity accounted investees are eliminated against the investment to the extent of Viohalco’s interest in the investee. Unrealized losses are eliminated in the same way as unrealized gains, but only to the extent that there is no evidence of impairment.

5.2. Foreign currency

(a) Foreign currency transactions

Transactions in foreign currencies are translated into the respective functional currencies of Viohalco’s companies at the exchange rates at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies are translated into functional currency at the exchange rate at the reporting date. Non-monetary assets and liabilities that are measured at fair value in a foreign currency are translated into the functional currency at the exchange rate, when the fair value was determined. Foreign currency gains and losses are recognized and classified in the consolidated statement of profit or loss based on the nature of the related item of the consolidated statement of financial position. Non-monetary items that are measured based on historical cost in a foreign currency are translated at the exchange rate at the date of the transaction.

Foreign currency differences arising from the translation of the following items are recognised in OCI:
- qualifying cash flow hedges to the extent that the hedges are effective;
- an investment in equity securities designated as at FVOCI.

(b) Foreign operations

The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on acquisition, are translated into Euro at the exchange rates of the reporting date. The income and expenses of foreign operations are translated into Euro at the exchange rates at the date of the transactions. The average rate for the period is deemed to be an appropriate rate. Foreign currency differences are recognised in OCI and accumulated in the translation reserve, except to the extent that the translation difference is allocated to NCI.

5.3. Revenue

Viohalco recognizes revenue from the following major sources:
- Sale of customized products and revenue from projects;
- Sale of standard products;
- Rendering of services.

Revenue is measured based on the consideration specified in a contract with a customer and excludes amounts collected on behalf of third parties. Viohalco recognizes revenue when it transfers control of a product or service to a customer. Consideration can vary because of trade discounts, volume rebates, returns or other similar items. Depending on the type of variable consideration the most appropriate method for measuring this variable consideration is used.

Sales of customized products and revenue from projects

Regarding contracts for projects and for customized products produced for the exclusive use of certain customers and with no alternative use, there is an enforceable right to payment for performance completed to date if the contract is terminated by the customer or another party for reasons other than Viohalco’s subsidiaries’ failure to perform as promised. Hence, it is concluded that the client controls all of the work in progress, as the goods are being produced. Therefore, for such contracts revenue is recognised progressively based on the most appropriate output or input method, to measure progress towards completion. The most common methods used are the following:

• For performance obligations related to production of customized products, depending on the type of contract concerned, the methods to measure progress is estimated based on:
  i. Production time elapsed, i.e. the ratio between the actual time spent on the production and the total number of scheduled production time. This method is used for submarine cables produced in long continuous lengths, since the production of such products normally lasts for significant period of time and, as a result, the related performance obligations are satisfied as production time elapses.
  ii. The quantity of manufactured and tested products compared with the total quantity to be produced according to the contract. This method is used for customized land cables, steel pipes and aluminium products, since the production is performed in batches and as a result the performance obligations related are satisfied as certain batches of agreed quantities have been produced.

VIOHALCO | ANNUAL REPORT 2021 125

• For installation phases of cables segment’s turnkey projects, the method to measure progress is based on appraisal of results achieved or milestones reached, based to clearly defined technical milestones, such as transport or meters of cables installed. When milestones are being used as a method to measure progress, these milestones faithfully depict the performance.

Sales of standard products

For products which are not considered customized, customers do not take control of the product until production is completed, therefore revenue is recognised at a point of time, when the control of the goods sold has been transferred. The timing of the transfer of control usually occurs when the goods have been shipped to the customers’ location, unless otherwise specified in the terms of the contract. The terms defined on the contracts with customers are according to Incoterms. Revenue recognised at a point in time is invoiced either simultaneously with its recognition, or within a short time period from its recognition. A receivable is recognised when the control is transferred to the customer, as this represents the point in time at which the right to consideration becomes unconditional.

Rendering of services

Revenue is recognised using the stage-of-completion method. The total consideration in the service contracts is allocated to all performance obligations in the contract based on their stand-alone selling prices. The stand-alone selling prices are determined based on the list prices at which Viohalco sells the services in separate transactions.

Contract assets and contract liabilities

The timing of revenue recognition, billings and cash collections results in billed accounts receivable, unbilled receivables (contract assets), and customer advances (contract liabilities). These contract assets and contract liabilities are presented on the Consolidated Statement of Financial Position in the lines ‘Contract assets’ and ‘Contract liabilities,’ respectively. For products and services for which revenue is recognised over time, amounts are billed as work progresses in accordance with agreed-upon contractual terms, either upon achievement of contractual milestones, or at the final delivery and acceptance of the manufactured items. Generally, billing occurs subsequent to revenue recognition for customized products and services performed over time resulting in contract assets. However, when advances from customers are received before revenue is recognized, a contract liability is recognized.

Contract costs

Viohalco’s subsidiaries recognize the incremental costs of obtaining contracts with customers and the costs incurred in fulfilling contracts with customers that are directly associated with the contract as an asset, if those costs are expected to be recoverable and record them in the line “Contract costs” in the Consolidated Statements of Financial Position. Incremental costs of obtaining contracts are costs incurred to obtain a contract with a customer that would not have been incurred if the contract had not been obtained. Fulfilment costs are only capitalized if they generate or enhance resources that will be used to satisfy performance obligations in the future. Assets arising from contract costs are amortized using either the straight-line method over a period based on the estimated contract duration or based on the portion of revenue recognised during the execution of the related contract. Incremental costs of obtaining contracts are recognised as an expense when incurred, if the amortisation period of the assets would be one year or less.

5.4. Employee benefits

(a) Short-term employee benefits

Short-term employee benefits are expensed as the related service is provided. A liability is recognised for the amount expected to be paid if Viohalco and its companies have a present legal or constructive obligation to pay this amount, as a result of past service provided by the employee and the obligation can be estimated reliably.

(b) Defined contribution plans

Defined-contribution plans are plans for the period after the employee has ceased to work during which Viohalco and its companies pay a defined amount to a third legal entity without any other obligation.# VIOHALCO | ANNUAL REPORT 2021

5.4. Employee Benefits

The accrued cost of defined-contribution programmes is recorded as an expense in the period that it concerns.

(c) Defined benefit plans

Viohalco and its companies’ net obligation in respect of defined benefit plans is calculated separately for each plan by estimating the amount of future benefit that employees have earned in the current and prior periods, discounting that amount and deducting the fair value of any plan assets. The discount rate is based on high-quality corporate bonds that are denominated in the currency in which the benefits will be paid. The calculation of defined benefit obligations is performed annually by a qualified actuary using the projected unit credit method, while benefits are attributed over the last 16 years before retirement of each employee.

Remeasurements of the net defined benefit liability, which comprise actuarial gains and losses, are recognised immediately in OCI. Viohalco and its companies determine the net interest expense on the net defined benefit liability for the period by applying the discount rate used to measure the defined benefit obligation at the beginning of the annual period to the then-net defined benefit liability, taking into account any changes in the net defined benefit liability during the period as a result of contributions and benefit payments. Net interest expense and other expenses related to defined benefit plans are recognised in profit or loss. When the benefits of a plan are changed or when a plan is curtailed, the resulting change in benefit that relates to past service or the gain or loss on curtailment is recognised immediately in profit or loss. Viohalco and its companies recognise gains and losses on the settlement of a defined benefit plan when the settlement occurs.

(d) Termination benefits

Termination benefits are expensed at the earlier of when Viohalco and its companies can no longer withdraw the offer of those benefits and when they recognise costs for a restructuring. If benefits are not expected to be settled wholly within 12 months of the reporting date, then they are discounted.

5.5. Government Grants

Grants from the government are recognized at their fair value where there is a reasonable assurance that the grant will be received and Viohalco’s companies will comply with all attached conditions. Government grants relating to costs are deferred and recognized in the statement of profit or loss over the period necessary to match them with the costs that they are intended to compensate. Government grants relating to the purchase of property, plant and equipment are included in non-current liabilities as deferred government grants and are credited to the statement of profit or loss (line “other income”) on a straight line basis over the expected useful lives of the related assets.

5.6. Finance income and finance cost

Viohalco and its companies finance income and finance costs mainly include:

• interest income;
• interest expense;
• dividend income;
• Foreign currency gains and losses from loans and deposits.

Interest income or expense is recognised using the effective interest method. The ‘effective interest rate’ is the rate that exactly discounts estimated future cash payments or receipts through the expected life of the financial instrument to:

• the gross carrying amount of the financial asset; or
• the amortised cost of the financial liability.

In calculating interest income and expense, the effective interest rate is applied to the gross carrying amount of the asset or to the amortised cost of the financial liability. Dividend income is recognised in profit or loss on the date on which Viohalco’s right to receive payment is established.

5.7. Income tax

Income tax expense comprises current and deferred tax. It is recognised in profit or loss except to the extent that it relates to a business combination, or to items recognised directly in equity or in OCI.

A. Current tax

Current tax comprised the expected tax payable or receivable on the taxable income or loss for the year and any adjustment to the tax payable or receivable in respect of previous years. It is measured using tax rates enacted or substantively enacted at the reporting date. Current tax also includes any tax arising from dividends. Current tax assets and liabilities are offset only if certain criteria are met.

B. Deferred tax

Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognised for:

• Temporary differences on the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither accounting nor taxable profit or loss;
• Temporary differences related to investments in subsidiaries, associates and joint arrangements to the extent that Viohalco and its companies are able to control the timing of the reversal of the temporary differences and it is probable that they will not reverse in the foreseeable future; and
• Taxable temporary differences arising on the initial recognition of goodwill.

Deferred tax assets are recognised for unused tax losses, unused tax credits and deductible temporary differences to the extent that is probable that future taxable profits will be available against which they can be used. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realised; such reductions are reversed when the probability of future taxable profits improves. Unrecognised deferred tax assets are reassessed at each reporting date and recognised to the extent that is has become probable that future taxable profits will be available against which they can be used. Deferred tax is measured at the tax rates that are expected to be applied to temporary differences when they reverse, using tax rates enacted or substantively enacted at the reporting date. The measurements of deferred tax reflect the tax consequences that would follow from the manner in which Viohalco and its companies expect, at the reporting date, to recover or settle the carrying amount of its assets and liabilities. Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities and when the deferred income taxes relate to the same fiscal authority.

5.8. Inventories

Inventories are stated at the lower of cost and net realisable value. The cost is determined by applying the method of weighted average cost and includes the production and conversion cost and all direct expenses required to bring inventories at their current condition. The net realisable value is estimated based on the inventory’s current sales price, in the ordinary course of business activities, less any possible selling expenses, whenever such a case occurs. The write-down of inventories to net realisable value and any reversals are recognized in ‘cost of sales’ in the period in which the write-downs occur.

5.9. Property, plant and equipment

A. Recognition and measurement

Property, plant and equipment are presented at their acquisition cost less accumulated depreciation and impairment. The acquisition cost includes all expenses that are directly associated with the asset’s acquisition or self-construction. The cost of self-constructed fixed assets includes the cost of direct labour, materials and any other cost that is required for the fixed asset to be ready for use as well as any borrowing costs. Subsequent expenditure is capitalised only if it is probable that the future economic benefits associated with the expenditure will flow to Viohalco and its companies. Repair and maintenance costs are recorded in the Consolidated Statement of Profit or Loss when these are incurred. On the sale of property, plant and equipment, any difference that may arise between the price that is received and the carrying value thereof is recorded through profit or loss in the category ’Other operating income/expenses’. Borrowing costs related to the construction of qualifying assets are capitalised during the period required for the construction to be completed.

B. Depreciation

Depreciation is calculated to write off the cost of items of property, plant and equipment less their estimated residual values using the straight-line method over their estimated useful lives and is generally recognised in profit or loss. Land is not depreciated. The component approach is followed if the cost of an asset comprises different major components of that asset with different useful lives.

Asset Category	Useful Life (Years)
Buildings	10-33
Plants	50
Machinery	2-35
Furniture and other equipment	2-8
Transport means	4-15

Computers are included in the category "Furniture and other equipment". Depreciation methods, useful lives and residual values are reviewed at each reporting date and adjusted if appropriate.

C. Reclassification to investment property

When the use of a property changes from owner-occupied to investment property, the property is reclassified to investment property. The item is reclassified at its net book value at the date of reclassification which becomes its deemed cost for subsequent accounting purposes.

D. Reclassification to assets held for sale

Non-current assets and disposal groups are reclassified as held for sale when their carrying amount will be recovered principally through a sale transaction rather than continuing use.

5.10. Intangible assets and goodwill

A. Recognition and measurement

Goodwill: Goodwill arising on the acquisition of subsidiaries is measured at cost less accumulated impairment losses.
Research and development: Expenditure on research activities is recognised in profit and loss as incurred.# 5. SIGNIFICANT ACCOUNTING POLICIES (Contd.)

5.10. Intangible Assets

Development expenditure is capitalised only if the expenditure can be measured reliably, the product or process is technically and commercially feasible, future economic benefits are probable and Viohalco’s companies intend and have sufficient resources to complete development and to use or sell the asset. Otherwise, it is recognised in profit or loss as incurred. Subsequent to initial recognition, development expenditure is measured at cost less accumulated amortisation and any accumulated impairment losses.

Software programmes: Software licenses are recorded at their acquisition cost less accumulated amortisation. These assets are amortised on the straight-line method over their estimated useful lives, which ranges between 3 to 5 years. Expenses that are associated with the software’s maintenance are recognised in profit or loss in the year in which they are incurred.

Other intangible assets: Other intangible assets, including customer relationships, patents and trademarks, that are acquired by Viohalco and its companies and have finite useful lives are measured at cost less accumulated amortisation and any accumulated impairment losses. Other intangible assets having indefinite useful lives are measured at cost less accumulated impairment losses.

B. Subsequent Expenditure

Subsequent expenditure is capitalised only when it increases the future economic benefits embodied in the specific asset to which it relates. All other expenditure, including expenditure on internally generated goodwill and brands, is recognised in profit or loss as incurred.

C. Amortisation and Useful Lives

Amortisation is calculated to write off the cost of intangible assets less their estimated residual values using the straight-line method over their estimated useful lives and is recognised in profit or loss. Goodwill and other intangible assets with indefinite useful lives are not amortised.

The estimated useful lives for the current and comparative periods are as follows:

• Trademarks and licenses 10 – 15 years
• Software programmes 3 – 5 years

Some intangible assets included in “Trademarks and licences” have indefinite useful lives and are therefore not amortised, but subject to an impairment testing. See Note 19 for detailed information.

Amortisation methods, useful lives and residual values are reviewed at each reporting date and adjusted if appropriate.

5.11. Investment Property

Investment property, which includes land, buildings and right of use assets, is owned by Viohalco and its subsidiaries for the collection of rents and is not used for owner purposes. Investment property is presented at cost less depreciation. When the carrying amounts of investment property exceed their recoverable value, the difference (impairment loss) is directly recorded in profit and loss as an expense. The reversal of impairment losses is also recognised in profit and loss as income.

Land is not depreciated. The buildings are depreciated by applying the straight-line method. The expected useful life of buildings is 18-33 years.

Management exercises judgement to determine whether a property qualifies as investment property or not. The criteria related to this judgement are as follows:

• Whether a property generates cash flows derived from rentals and capital appreciation largely independently of the other assets held by Viohalco;
• Whether a property does not generate cash flows from the production or supply of goods or services or the use of property for administrative purposes that are attributable not only to property, but also to other assets used in the production or supply process;
• Whether a building that is vacant will be held to be leased out or for capital appreciation;
• Whether a property that is being constructed or developed for future use as investment property;
• Whether Viohalco holds land for a currently undetermined future use.

5.12. Assets Held for Sale

Non-current assets or disposal groups comprising assets and liabilities are classified as held-for-sale, if it is highly probable that they will be recovered primarily through sale rather than through continuing use. Such assets or disposal groups are generally measured at the lower of their carrying amount and fair value less costs to sell. Any impairment loss on a disposal group is allocated first to goodwill and then to the remaining assets and liabilities on a pro rata basis, except that no loss is allocated to inventories, financial assets or employee benefits which continue to be measured in accordance with Viohalco and its companies’ other accounting policies.

Impairment losses on initial classification as held-for-sale and subsequent gains and losses on remeasurement are recognised in profit or loss. Once classified as held-for-sale, intangible assets and property, plant and equipment are no longer amortised or depreciated and any equity-accounted investee is no longer equity accounted.

5.13. Impairment

A. Non-derivative Financial Assets

Financial instruments and contract assets

Viohalco recognises loss allowances for ECLs on:

• Financial assets measured at amortised cost;
• Contract assets;
• Lease receivables.

Loss allowances for trade receivables and contract assets are always measured at an amount equal to lifetime ECLs, except for cash and cash equivalents (12-month expected credit loss).

Viohalco considers a financial asset to be in default when the borrower is unlikely to pay its credit obligations in full, without recourse by Viohalco companies to actions such as realizing security (if any is held).

Lifetime ECLs are the ECLs that result from all possible default events over the expected life of a financial instrument.

12-month ECLs are the portion of ECLs that result from default events that are possible within the 12 months after the reporting date (or a shorter period if the expected life of the instrument is less than 12 months).

The maximum period considered when estimating ECLs is the maximum contractual period over which Viohalco companies are exposed to credit risk.

Measurement of ECLs

ECLs are a probability-weighted estimate of credit losses. Credit losses are measured as the present value of all cash shortfalls (i.e. the difference between the cash flows due to the entity in accordance with the contract and the cash flows that Viohalco expects to receive). ECLs are discounted at the effective interest rate of the financial asset.

Presentation of allowance for ECL in the statement of financial position

Loss allowances for financial assets measured at amortised cost are deducted from the gross carrying amount of the assets. Impairment losses related to trade and other receivables, including contract assets, are presented separately in the statement of profit or loss.

Write-off

The gross carrying amount of a financial asset is written off when Viohalco has no reasonable expectations of recovering a financial asset in its entirety or a portion thereof. For all customers, Viohalco individually makes an assessment with respect to the timing and amount of write-off based on whether there is a reasonable expectation of recovery. Viohalco expects no significant recovery from the amount written off. However, financial assets that are written off could still be subject to enforcement activities in order to comply with Viohalco’s procedures for recovery of amounts due.

B. Non-financial Assets

At each reporting date, Viohalco and its companies review the carrying amounts of its non-financial assets (other than inventories and deferred tax assets) to determine whether there is any indication of impairment. If any such indication exists, then the asset’s recoverable amount is estimated. Goodwill and intangible assets with indefinite useful life is tested annually for impairment loss. For impairment testing, assets are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or CGUs. Goodwill arising from a business combination is allocated to CGUs or groups of CGUs that are expected to benefit from the synergies of the combination.

The recoverable amount of an asset or CGU is the greater of its value in use and its fair value less costs to sell. Value in use is based on the estimated future cash flows, discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset or CGU. An impairment loss is recognised if the carrying amount of an asset or CGU exceeds its recoverable amount.

Impairment losses are recognised in profit or loss under ’Other expenses‘. They are allocated first to reduce the carrying amount of any goodwill allocated to the CGU and then to reduce the carrying amounts of the other assets in the CGU on a pro rata basis. An impairment loss in respect of goodwill is not reversed. For other assets, an impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised.

5.14. Leases

From 1 January 2019, at inception of a contract, Viohalco assesses whether a contract is, or contains, a lease. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. To assess whether a contract conveys the right to control the use of an identified asset, the Viohalco companies use the definition of a lease in IFRS 16.

Accounting for lease contracts as a lessee

Viohalco companies lease various offices, warehouses, machinery and cars. Rental contracts are usually made for fixed periods of 1 to 5 years, with some exceptions like lease of specialized machinery, ports, gas cylinders and land which are leased for longer periods.# VIOHALCO | ANNUAL REPORT 2021 131

Viohalco recognises a right-of-use asset and a lease liability at the lease commencement date. The right-of-use asset is initially measured at cost, comprising the following: • the amount of the initial measurement of lease liability; • any lease payments made at or before the commencement date less any lease incentives received; • any initial direct costs; and • restoration costs. Subsequently, the right-of-use asset is measured at cost less any accumulated depreciation and impairment losses and adjusted for certain remeasurements of the lease liability.

The lease liability is initially measured at the present value of the following lease payments:
• xed payments (including in-substance xed payments), less any lease incentives receivable;
• variable lease payment that are based on an index or a rate;
• amounts expected to be payable by the lessee under residual value guarantees;
• the exercise price of a purchase option if the lessee is reasonably certain to exercise that option; and
• payments of penalties for terminating the lease, if the lease term reects the lessee exercising that option.

Lease payments are discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the incremental borrowing rate of the component that entered into the lease agreement. Generally, Viohalco uses its incremental borrowing rate as the discount rate. This is the rate that the lessee, i.e. each subsidiary of Viohalco, would have to pay on the commencement date of the lease for a loan of a similar term, and with similar security, to obtain an asset of similar value to the right-of-use asset in similar economic environment.

The lease liability is subsequently increased by the interest cost on the lease liability and decreased by lease payment made. It is remeasured if there is a modification that is not accounted for as a separate lease; when there is a change in future lease payments arising from a change in an index or rate; a change in the estimate of the amount expected to be payable under a residual value guarantee; and changes in the assessment of whether a purchase or extension option is reasonably certain to be exercised or a termination option is reasonably certain not to be exercised.

Lease liabilities and right-of-use assets are presented separately in the statement of nancial position. Right-of-use assets that meet the denition of investment property are presented within ‘Investment property’.

Viohalco has elected not to separate non-lease components from lease components.

Payments associated with leases of 12 months or less and leases of low-value assets are recognised on a straight-line basis as an expense in prot or loss. Low-value assets comprise IT-equipment and small items of oce furniture.

Viohalco applies judgement to determine the lease term for some lease contracts in which it is a lessee that include renewal options. The assessment of whether Viohalco is reasonably certain to exercise such options impacts the lease term, which signicantly aects the amount of lease liabilities and right-of-use assets recognised.

Viohalco has elected to present interest paid related to lease liabilities in the Consolidated Statement of Cash Flows, within the line ’Interest charges & related expenses paid‘ in operating activities.

Accounting for lease contracts as a lessor

Leases in which Viohalco companies do not transfer substantially all the risks and rewards incidental to ownership of an asset are classied as operating leases. Rental income is recognised as revenue on a straight-line basis over the term of the lease. Lease incentives granted are recognised as an integral part of the total rental income, over the term of the lease. Initial direct costs incurred in obtaining an operating lease are added to the carrying amount of the underlying asset and recognised as expense over the lease term on the same basis as lease income.

5.15. Financial instruments

(a) Recognition and initial measurement

Trade receivables and debt securities issued are initially recognised when they are originated. All other nancial assets and nancial liabilities are initially recognised when Viohalco becomes a party to the contractual provisions of the instrument. A nancial asset (unless it is a trade receivable without a signicant nancing component) or nancial liability is initially measured at fair value plus, for an item not at FVTPL, transaction costs that are directly attributable to its acquisition or issue. A trade receivable without a signicant nancing component is initially measured at the transaction price.

(b) Classication and subsequent measurement

Financial assets

On initial recognition, a nancial asset is classied as measured at: amortised cost; FVOCI – debt investment; FVOCI – equity investment; or FVTPL. Financial assets are not reclassied subsequent to their initial recognition unless Viohalco changes its business model for managing nancial assets, in which case all aected nancial assets are reclassied on the rst day of the rst reporting period following the change in the business model.

A nancial asset is measured at amortised cost if it meets both of the following conditions and is not designated as at FVTPL:
- it is held within a business model whose objective is to hold assets to collect contractual cash ows; and
- its contractual terms give rise on specied dates to cash ows that are solely payments of principal and interest on the principal amount outstanding.

A debt investment is measured at FVOCI if it meets both of the following conditions and is not designated as at FVTPL:
- it is held within a business model whose objective is achieved by both collecting contractual cash ows and selling nancial assets; and
- its contractual terms give rise on specied dates to cash ows that are solely payments of principal and interest on the principal amount outstanding.

On initial recognition of an equity investment that is not held for trading, Viohalco may irrevocably elect to present subsequent changes in the investment’s fair value in OCI. This election is made on an investment-by-investment basis.

All nancial assets (except derivatives to which cash ow hedging is applied) not classied as measured at amortised cost or FVOCI as described above are measured at FVTPL. On initial recognition, Viohalco may irrevocably designate a nancial asset that otherwise meets the requirements to be measured at amortised cost or at FVOCI as at FVTPL, if doing so eliminates or signicantly reduces an accounting mismatch that would otherwise arise.

Financial assets – Business model assessment:
Viohalco makes an assessment of the objective of the business model in which a nancial asset is held at a portfolio level because this best reects the way the business is managed and information is provided to management. Transfers of nancial assets to third parties in transactions that do not qualify for derecognition are not considered sales for this purpose, consistent with Viohalco companies’continuing recognition of the assets.

Financial assets – Assessment whether contractual cash ows are solely payments of principal and interest:
For the purposes of this assessment, ‘principal’ is dened as the fair value of the nancial asset on initial recognition. ‘Interest’ is dened as consideration for the time value of money and for the credit risk associated with the principal amount outstanding during a particular period of time and for other basic lending risks and costs (e.g. liquidity risk and administrative costs), as well as a prot margin. In assessing whether the contractual cash ows are solely payments of principal and interest, Viohalco considers the contractual terms of the instrument. This includes assessing whether the nancial asset contains a contractual term that could change the timing or amount of contractual cash ows such that it would not meet this condition. In making this assessment, Viohalco considers:
• contingent events that would change the amount or timing of cash ows;
• terms that may adjust the contractual coupon rate, including variable-rate features;
• prepayment and extension features; and
• terms that limit the claim to cash ows from specied assets (e.g. non-recourse features).

Financial assets – Subsequent measurement and gains and losses:

Financial assets at FVTPL
These assets are subsequently measured at fair value. Net gains and losses, including any interest or dividend income, are recognised in prot or loss.

Financial assets at amortised cost
These assets are subsequently measured at amortised cost using the eective interest method. The amortised cost is reduced by impairment losses. Interest income, foreign exchange gains and losses and impairment are recognised in prot or loss. Any gain or loss on derecognition is recognised in prot or loss.

Debt investments at FVOCI
These assets are subsequently measured at fair value. Interest income calculated using the eective interest method, foreign exchange gains and losses and impairment are recognised in prot or loss. Other net gains and losses are recognised in OCI. On derecognition, gains and losses accumulated in OCI are reclassied to prot or loss.

Equity investments at FVOCI
These assets are subsequently measured at fair value. Dividends are recognised as income in prot or loss unless the dividend clearly represents a recovery of part of the cost of the investment. Other net gains and losses are recognised in OCI and are never reclassied to prot or loss.

Financial liabilities – Classication, subsequent measurement and gains and losses:

Financial liabilities are classied as measured at amortised cost or FVTPL. A nancial liability is classied as at FVTPL if it is classied as held-for- trading, it is a derivative or it is designated as such on initial recognition.

VIOHALCO | ANNUAL REPORT 2021 132Financial liabilities at FVTPL are measured at fair value and net gains and losses, including any interest expense, are recognised in profit or loss. Other financial liabilities are subsequently measured at amortised cost using the effective interest method. Interest expense and foreign exchange gains and losses are recognised in profit or loss. Any gain or loss on derecognition is also recognised in profit or loss.

(c) Derecognition
Financial assets
Viohalco derecognises a financial asset when the contractual rights to the cash flows from the financial asset expire, or it transfers the rights to receive the contractual cash flows in a transaction in which substantially all of the risks and rewards of ownership of the financial asset are transferred or in which Viohalco neither transfers nor retains substantially all of the risks and rewards of ownership and it does not retain control of the financial asset. Viohalco enters into transactions whereby it transfers assets recognised in its statement of financial position, but retains either all or substantially all of the risks and rewards of the transferred assets. In these cases, the transferred assets are not derecognised.

Financial liabilities
Viohalco derecognises a financial liability when its contractual obligations are discharged or cancelled, or expire. Viohalco also derecognises a financial liability when its terms are modified and the cash flows of the modified liability are substantially different, in which case a new financial liability based on the modified terms is recognised at fair value. On derecognition of a financial liability, the difference between the carrying amount extinguished and the consideration paid (including any non- cash assets transferred or liabilities assumed) is recognised in profit or loss.

(d) Offsetting
Financial assets and financial liabilities are offset and the net amount presented in the statement of financial position when, and only when, Viohalco currently has a legally enforceable right to set off the amounts and it intends either to settle them on a net basis or to realise the asset and settle the liability simultaneously.

(e) Derivatives and hedge accounting
Viohalco has elected not to adopt the provisions of IFRS 9 regarding the hedge accounting and will continue applying IAS 39. Viohalco’s companies hold derivative financial instruments designated as fair value or cash flow hedges. Derivatives are used to cover risks arising from fluctuations in prices of metals, foreign exchange rates, interest rates on borrowings and energy prices (natural gas).

VIOHALCO | ANNUAL REPORT 2021 133

Derivatives are initially measured at fair value; any directly attributable transaction costs are recognised in profit or loss as incurred. Subsequent to initial recognition, derivatives are measured at fair value and changes therein are generally recognised in profit or loss, unless the instrument qualifies for cash flow hedge accounting. Gain or losses from derivatives are classified as operating or financing expense according to the classification of the hedged item.

Fair value hedge
Derivatives are designated as fair value hedges when the exposure to changes in the fair value of a recognized financial asset or liability is hedged. Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recognised in the Consolidated Statement of Profit or Loss, along with any changes in the fair value of the hedged asset or liability that are attributable to the hedged risk.

Cash flow hedge
The effective portion of changes in the fair value of derivatives designated as cash flow hedges is recognised in the ’Hedging reserve‘. Any ineffective proportion is recognized immediately in profit or loss. The amounts recorded in “Hedging Reserve” are reclassified to the consolidated statement of profit or loss in the same period or periods during which the hedged forecast cash flows affect profit or loss or the hedged item affects profit or loss. When a hedge item is sold or when the hedging proportion no longer meets the hedge accounting criteria, hedge accounting is discontinued prospectively, the amounts recorded in ‘Hedging reserve’ remain as a reserve and are reclassified to the consolidated statement of profit or loss when the hedged asset affects profits or losses. In the case of a hedge on a forecast future transaction which is no longer expected to be realized, the amounts recorded in ‘Hedging reserve’ are reclassified to the consolidated statement of profit or loss. Viohalco’s companies examine the effectiveness of the cash flow hedge at inception (prospectively) by comparing the critical terms of the hedging instrument with the critical terms of the hedged item, and then at every reporting date (retrospectively), the effectiveness of the cash flow hedge by applying the dollar offset method on a cumulative basis is examined.

5.16. Cash & cash equivalents
Cash and cash equivalents comprise cash on hand and deposits held at call with financial institutions and short-term highly liquid deposits with a maturity of three months or less, that are readily convertible to a known amount of cash and subject to an insignificant risk of changes in value.

5.17. Share capital
Shareholder’s equity is composed of ordinary shares. Incremental costs directly attributable to the issue of ordinary shares are recognised as a deduction from equity. Income tax relating to transaction costs of an equity transaction is accounted in equity (see note 5.7).

5.18. Provisions
Provisions are measured by discounting the expected future cash flows at a pre-tax rate. The discount rate used for the determination of present value reflects current market assessments of the time value of money and the risks specific to the obligation. Provisions are recognised when:
(a) There is a present legal or constructive obligation as a result of past events.
(b) Payment is probable to settle the obligation.
(c) The amount of the payment in question can be reliably estimated.

More specifically:
Provisions for pending court rulings are recognised when it is more likely than not, that a present obligation from this litigation exists, and payment is probable. Assurance warranty provisions are recognised when the product is sold and according to historical experience (probability that sold products will need to be replaced). The initial estimate of warranty-related costs is revised annually. Restructuring provisions are recognised only when Viohalco has a constructive obligation, which is when a detailed formal plan identifies the business or part of the business concerned, the location and number of employees affected, a detailed estimate of the associated costs and an appropriate timeline, and the employees affected have been notified of the plan’s main features or when the company has already started to implement the plan.

VIOHALCO | ANNUAL REPORT 2021 134

A provision for onerous contracts is measured at the present value of the lower of the expected cost of terminating a contract and the expected net cost of continuing with the contract. Before the provision is established, Viohalco recognises any impairment loss on the associated assets with the contract.

5.19. Earnings per Share
Viohalco presents basic and diluted earnings per share. Basic earnings per share are calculated by dividing the net profit/ loss attributable to holders of the Company’s ordinary shares by the average weighted number of outstanding ordinary shares during each period. Diluted earnings per share are determined by adjusting the profit or loss attributable to holders of ordinary shares and the average weighted number of outstanding ordinary shares by the effect of all diluted eventual ordinary shares consisting of convertible notes and shares with options granted to the staff.

5.20. Operating profit
Operating profit is the result generated from the continuing principal revenue-producing activities of Viohalco as well as other income and expenses related to operating activities. Operating profit excludes net finance costs, share of profit of equity-accounted investees and income taxes.

5.21. Fair value measurement
‘Fair value’ is 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 in the principal or, in its absence, the most advantageous market to which Viohalco has access at that date. The fair value of a liability reflects its non-performance risk. A number of Viohalco’s accounting policies and disclosures require the measurement of fair values, for both financial and non-financial assets and liabilities. When one is available, Viohalco measures the fair value of an instrument using the quoted price in an active market for that instrument. A market is regarded as ‘active’ if transactions for the asset or liability take place with sufficient frequency and volume to provide pricing information on an ongoing basis. If there is no quoted price in an active market, then Viohalco uses valuation techniques that maximise the use of relevant observable inputs and minimise the use of unobservable inputs. The chosen valuation technique incorporates all of the factors that market participants would take into account in pricing a transaction. If an asset or a liability measured at fair value has a bid price and an ask price, then Viohalco measures assets and long positions at a bid price and liabilities and short positions at an ask price. The best evidence of the fair value of a financial instrument on initial recognition is normally the transaction price – i.e. the fair value of the consideration given or received.# 5.22. New standards, amendment to standards and interpretations of IFRS’s
A number of new or amended standards became applicable for the current financial year and subsequent years. Viohalco has applied all of the new standards, interpretations and amendments to existing standards that were mandatory for the first time in the fiscal year beginning 1 January 2021 and none of the new or amended standards and interpretations has had material impact on recognition and measurement in the Consolidated Financial Statements, except for the effect of the adoption of the IFRIC Agenda Decision ‘Attributing Benefit to Periods of Service’ as presented in note 5.23.

Standards and Interpretations effective for the current financial year:

The following new standards and amendments to standards are mandatory for the first time for the financial year beginning 1 January 2021 and have been endorsed by the European Union:

• IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16 (Amendments) ‘Interest rate benchmark reform – Phase 2’
  The amendments complement those issued in 2019 and focus on the effects on financial statements when a company replaces the old interest rate benchmark with an alternative benchmark rate as a result of the reform. More specifically, the amendments relate to how a company will account for changes in the contractual cash flows of financial instruments, how it will account for the change in its hedging relationships and the information it should disclose.

• IFRS 16 (Amendment) ‘Covid-19-Related Rent Concessions’
  If certain conditions are met, the Amendment would permit lessees, as a practical expedient, not to assess whether particular Covid-19-related rent concessions are lease modifications. Instead, lessees that apply the practical expedient would account for those rent concessions as if they were not lease modifications.

• International Financial Reporting Interpretations Committee (IFRIC) Agenda Decision: IAS 19 “Employee Benefits” - Attributing Benefit to Periods of Service
  An agenda decision was published in May 2021 by the IFRIC in relation to IAS 19 “employee benefits” and more specifically to how the applicable principles and requirements in IFRS Standards apply to attributing benefit to periods of service. Further details and the impact on the Viohalco consolidated financial statements from the adoption of this decision is presented in note 5.23.

Standards and Interpretations effective for subsequent periods:

The following new standards and amendments have been issued, but are not mandatory for the first time for the financial year beginning 1 January 2021 but have been endorsed by the European Union. The following amendments are not expected to have a material impact on Viohalco Consolidated Financial Statements in the current or future reporting periods.

• IFRS 16 (Amendment) ‘Covid-19-Related Rent Concessions’ (effective for annual periods beginning on or after 1 April 2021)
  The amendments extend, by one year, the May 2020 amendment that provides lessees with an exemption from assessing whether a COVID-19- related rent concession is a lease modification. In particular, the amendment permits a lessee to apply the practical expedient regarding COVID-19-related rent concessions to rent concessions for which any reduction in lease payments affects only payments originally due on or before 30 June 2022 (rather than only payments originally due on or before 30 June 2021).

• Amendments to IFRS 3 Business Combinations; IAS 16 Property, Plant and Equipment; IAS 37 Provisions, Contingent Liabilities and Contingent Assets as well as Annual Improvements (effective for annual periods beginning on or after 1 January 2022)
  The package of amendments includes narrow-scope amendments to three Standards as well as the Board’s Annual Improvements, which are changes that clarify the wording or correct minor consequences, oversights or conflicts between requirements in the Standards.

• Amendments to IFRS 3 Business Combinations update a reference in IFRS 3 to the Conceptual Framework for Financial Reporting without changing the accounting requirements for business combinations.
• Amendments to IAS 16 Property, Plant and Equipment prohibit a company from deducting from the cost of property, plant and equipment amounts received from selling items produced while the company is preparing the asset for its intended use. Instead, a company will recognise such sales proceeds and related cost in profit or loss.
  • Amendments to IAS 37 Provisions, Contingent Liabilities and Contingent Assets specify which costs a company includes when assessing whether a contract will be loss-making.
• Annual Improvements 2018-2020 make minor amendments to IFRS 1 First-time Adoption of International Financial Reporting Standards, IFRS 9 Financial Instruments, IAS 41 Agriculture and the Illustrative Examples accompanying IFRS 16 Leases.

The following amendments have been issued, but are not mandatory for the first time for the financial year beginning 1 January 2021 and have not been endorsed by the European Union. The following amendments are not expected to have a material impact on Viohalco Consolidated Financial Statements in the current or future reporting periods.

• Amendments to IAS 1 ‘Presentation of Financial Statements: Classification of Liabilities as current or non-current’ (effective 01/01/2023), affect only the presentation of liabilities in the statement of financial position — not the amount or timing of recognition of any asset, liability income or expenses, or the information that entities disclose about those items. They:
• Clarify that the classification of liabilities as current or non-current should be based on rights that are in existence at the end of the reporting period and align the wording in all affected paragraphs to refer to the "right" to defer settlement by at least twelve months and make explicit that only rights in place "at the end of the reporting period" should affect the classification of a liability;

• Clarify that classification is unaffected by expectations about whether an entity will exercise its right to defer settlement of a liability; and make clear that settlement refers to the transfer to the counterparty of cash, equity instruments, other assets or services.

• Amendments to IAS 1 Presentation of Financial Statements and IFRS Practice Statement 2: Disclosure of Accounting policies (effective 1 January 2023).
  The amendments aim to improve accounting policy disclosures and to help users of the financial statements to distinguish between changes in accounting estimates and changes in accounting policies. The IAS 1 amendment requires companies to disclose their material accounting policy information rather than their significant accounting policies. Further, the amendment to IAS 1 clarifies that immaterial accounting policy information need not be disclosed. To support this amendment, the Board also amended IFRS Practice Statement 2, ‘Making Materiality Judgements’, to provide guidance on how to apply the concept of materiality to accounting policy disclosures. The amendments are effective for annual reporting periods beginning on or after 1 January 2023. Earlier application is permitted (subject to any local endorsement process).

• Amendments to IAS 8 Accounting policies, Changes in Accounting Estimates and Errors: Definition of Accounting Estimates (effective 1 January 2023).
  The amendment to IAS 8, ‘Accounting Policies, Changes in Accounting Estimates and Errors’, clarifies how companies should distinguish changes in accounting policies from changes in accounting estimates. The amendments are effective for annual reporting periods beginning on or after 1 January 2023. Earlier application is permitted (subject to any local endorsement process).

• Amendments to IAS 12 Income Taxes: Deferred Tax related to Assets and Liabilities arising from a Single Transaction (effective 1 January 2023).
  The amendments clarify how companies account for deferred tax on transactions such as leases and decommissioning obligations. The main change in the amendments is an exemption from the initial recognition exemption of IAS 12.15(b) and IAS 12.24. Accordingly, the initial recognition exemption does not apply to transactions in which equal amounts of deductible and taxable temporary differences arise on initial recognition. The amendments are effective for annual reporting periods beginning on or after 1 January 2023. Early adoption is permitted.

• Amendments to IFRS 17 Insurance contracts: Initial Application of IFRS 17 and IFRS 9 – Comparative Information (issued on 9 December 2021, effective 1 January 2023).
  The amendment is a transition option relating to comparative information about financial assets presented on initial application of IFRS 17. The amendment is aimed at helping entities to avoid temporary accounting mismatches between financial assets and insurance contract liabilities, and therefore improve the usefulness of comparative information for users of financial statements.

5.23.# Change in accounting policy

In May 2021, the IFRS Interpretations Committee (IFRIC) finalized an agenda decision that includes material explaining how the applicable principles and requirements in IFRS Standards apply on attributing benefits to periods of service on a specific fact pattern of a defined benefit plan, which has the terms described below:

a. employees are entitled to a lump sum benefit payment when they reach a specified retirement age, provided they are employed by the entity when they reach that retirement age; and
b. the amount of the retirement benefit to which an employee is entitled depends on the length of employee service before the retirement age and is capped at a specified number of consecutive years of service.

The indemnities' policy applied by Greek subsidiaries provides for a fact pattern that aligns with the one described in the IFRIC agenda decision. Therefore, to account for the Defined Benefit Obligation, Greek subsidiaries of Viohalco are now attributing benefits over the last 16 years before retirement of each employee. Prior to the issuance of this agenda decision, the Greek subsidiaries applied IAS 19 by attributing the benefits defined in accordance with the applicable Greek legislation (Law 3198/1955, Law 2112/1920 and Law 4093/2012) during the period from the hiring until the expected retirement date of each employee. Based on IAS 8, this change shall be treated as a change in accounting policy.

The following tables present the effect of implementing the final agenda decision regarding every affected specific item of the consolidated financial statements for the comparative periods.

i. Consolidated Statement of Financial Position

Effect on 2020 opening balances:

At 31 December 2019
Amounts in EUR thousand

	As reported	IAS 19 Restatement	Restated figures
Deferred tax assets	17,618	-2,946	14,672
Other Non-Current assets	2,201,781	0	2,201,781
Non-Current assets	2,219,399	-2,946	2,216,453
Current assets	1,843,511	0	1,843,511
Total assets	4,062,910	-2,946	4,059,964
Retained earnings	184,854	11,566	196,420
Other components of equity attributable to owners of the Company	1,004,361	0	1,004,361
Equity attributable to owners of the Company	1,189,215	11,566	1,200,781
Non-controlling interests	145,859	1,338	147,197
Total equity	1,335,074	12,904	1,347,978
Employee benefits	37,362	-16,961	20,401
Deferred tax liabilities	82,317	1,111	83,428
Other Non-Current liabilities	1,036,145	0	1,036,145
Non-Current liabilities	1,155,824	-15,850	1,139,974
Current liabilities	1,572,012	0	1,572,012
Total liabilities	2,727,836	-15,850	2,711,986
Total equity and liabilities	4,062,910	-2,946	4,059,964

VIOHALCO | ANNUAL REPORT 2021 137

Effect on 2020 closing balances:

At 31 December 2020
Amounts in EUR thousand

	As reported	IAS 19 Restatement	Restated figures
Deferred tax assets	18,456	-1,250	17,206
Other Non-Current Assets	2,360,472	0	2,360,472
Non-Current assets	2,378,928	-1,250	2,377,678
Current assets	1,819,835	0	1,819,835
Total assets	4,198,763	-1,250	4,197,513
Retained earnings	201,467	12,630	214,097
Other components of equity attributable to owners of the Company	1,005,228	0	1,005,228
Equity attributable to owners of the Company	1,206,695	12,630	1,219,325
Non-controlling interests	174,431	1,498	175,929
Total equity	1,381,126	14,128	1,395,254
Employee benefits	40,471	-18,558	21,913
Deferred tax liabilities	88,077	3,181	91,258
Other Non-Current liabilities	1,104,401	0	1,104,401
Non-Current liabilities	1,232,949	-15,377	1,217,572
Current liabilities	1,584,687	0	1,584,687
Total liabilities	2,817,637	-15,377	2,802,259
Total equity and liabilities	4,198,763	-1,250	4,197,513

ii. Consolidated Statement of Profit or Loss and OCI

For the period ended 31 December 2020
Amounts in EUR thousand

	As reported	IAS 19 Restatement	Restated figures
Revenue	3,850,077	0	3,850,077
Cost of sales	-3,500,811	-223	-3,501,034
Gross profit	349,266	-223	349,043
Other income	44,240	0	44,240
Selling and distribution expenses	-75,976	-25	-76,001
Administrative expenses	-132,822	-106	-132,928
Reversal of / (Impairment loss) on receivables and contract assets	-1,497	0	-1,497
Other expenses	-29,701	165	-29,536
Operating result	153,511	-190	153,321
Net finance costs	-92,307	0	-92,307
Share of profit of equity-accounted investees, net of tax	-1,740	0	-1,740
Profit before tax	59,463	-190	59,273
Income tax expense	-26,553	51	-26,502
Profit for the year	32,910	-139	32,771
Remeasurements of defined benefit liability	-2,844	1,787	-1,057
Other comprehensive income / (expense) after tax	-8,265	0	-8,265
Related tax	600	-425	175
Total comprehensive income after tax	22,402	1,223	23,624

VIOHALCO | ANNUAL REPORT 2021 138

iii. Consolidated Statement of Cash Flows

For the period ended 31 December 2020
Amounts in EUR thousand

	As reported	IAS 19 Restatement	Restated figures
Cash flows from operating activities
Profit of the period	32,910	-139	32,771
Adjustments for:
- Income tax	26,553	-51	26,502
- Other	214,457	0	214,457
Changes in:
- Employee benefits	265	238	503
Other	50,897	-20	50,877
Net Cash inflows from operating activities	325,082	28	325,111
Net Cash flows used in investing activities	-258,356	0	-258,356
Net cash flows used in financing activities	-62,464	0	-62,464
Net (decrease)/ increase in cash and cash equivalents	4,262	29	4,290
Cash and cash equivalents at 1 January	214,499	0	214,499
Effect of movement in exchange rates on cash held	400	-29	371
Cash and cash equivalents at 31 December	219,161	0	219,161

6. Operating segments

A. Basis for the division into segments

For management purposes, Viohalco is split into seven major strategic reportable segments which operate in different industries:

• Aluminium;
• Copper;
• Cables;
• Steel pipes;
• Steel;
• Real estate;
• Other activities.

These segments offer different products and services, and are managed separately because they require different technology and marketing strategies. Such structural organization is determined by the nature of risks and returns associated with each business segment. It is based on the management structure, as well as the internal reporting system. It represents the basis on which Viohalco reports its segmental information. The segment analysis presented in these consolidated financial statements reflects operations analysed by business. This is the way the chief operating decision maker of Viohalco regularly reviews its’ operating results in order to allocate resources to segments and in assessing their performance. For the purposes of segmental reporting, all Viohalco companies, except those operating as trading companies, have been assigned to a specific reportable segment. Regarding the trading companies of Viohalco, their profit or loss and balance sheet figures have been allocated to the reportable segments, according to the nature of their transactions.

A brief description of the segments is as follows:

• Aluminium: ElvalHalcor through its aluminium rolling division (Elval), its subsidiaries Symetal S.A., Elval Colour S.A. and Vepal S.A. along with Bridgnorth Aluminium and Etem Extrusions deliver a wide variety of products from aluminium coils and sheets for general applications and aluminium foil for household use, to special products, such as, rolled and extruded aluminium products for shipbuilding, automotive and construction industries, and lithographic coils.
• Copper: ElvalHalcor through its copper tubes division (Halcor) and its subsidiary Sofia Med S.A. produce a wide range of copper and copper alloy products that span from copper and brass tubes, copper strips, sheets and plates, to copper bus bars and rods.
• Cables: Hellenic Cables companies consist one of the largest cable producers in Europe, manufacturing power, telecommunication and submarine cables, as well as enamelled wires and compounds.

VIOHALCO | ANNUAL REPORT 2021 139

• Steel Pipes: Corinth Pipeworks engages in the production of steel pipes for the transportation of natural gas, oil and water networks, as well as steel hollow sections which are used in construction projects.
• Steel: Sidenor Steel Industry, Stomana Industry and their subsidiaries manufacture long, flat and downstream steel products.
• Real estate: Viohalco derives value from the real estate assets of its subsidiaries by developing and managing large-scale commercial and industrial properties.
• Other: Other activities mainly encompass expenses incurred by the parent (holding) company, along with the results of companies which operate in the Technology and R&D&I segment, ceramic trade activities (Vitruvit) and resource recovery segment. None of these activities met the quantitative thresholds for reportable segments in 2021 or 2020.

B. Information about reportable segments

The information disclosed in the tables below is derived directly from the internal financial reporting system used by the executive management (i.e. chief operating decision maker) to monitor and evaluate the performance of the operating segments separately. The following tables illustrate the information about the reportable segments profit or loss, assets and liabilities at 31 December 2021 and 2020, and for the years ended.# C. Geographic information

Viohalco’s segments are managed on a worldwide basis, but operate manufacturing facilities and sales offices are located primarily in Greece, Germany, United Kingdom, France, Bulgaria, Romania, Serbia, North Macedonia and U.S.A. The geographic information below analyses the consolidated non-current assets by the Company’s country of domicile and other countries. In presenting the geographic information, segment assets were based on the geographic location of the assets. In Europe, assets’ information for Greece and Belgium is reported separately.

Property, plant and equipment

Balance at 31 December

Amounts in EUR thousands	2021	2020
Belgium	1,368	1,374
Greece	1,611,432	1,481,299
Other	476,306	471,423
Total	2,089,107	1,954,096

Intangible assets and goodwill

Balance at 31 December

Amounts in EUR thousands	2021	2020
Belgium	11	29
Greece	35,029	34,526
Other	7,044	4,990
Total	42,083	39,545

Investment property

Balance at 31 December

Amounts in EUR thousands	2021	2020
Greece	280,091	269,608
Other	785	805
Total	280,876	270,413

Right of use assets

Balance at 31 December

Amounts in EUR thousands	2021	2020
Belgium	188	184
Greece	29,968	32,270
Other	4,133	6,044
Total	34,288	38,498

7. Revenue

Revenue is derived from contracts with customers and investment property rental income.

For the year ended 31 December

Amounts in EUR thousands	2021	2020
Rental income from investment property	11,472	10,041
Revenue from contracts with customers	5,363,040	3,840,036
Total	5,374,512	3,850,077

A. Disaggregation of revenue

In the following table, revenue from contracts with customers is disaggregated by primary geographical market and timing of revenue recognition. The table includes a reconciliation with the Viohalco's reportable segments (see Note 6).

For the year ended 31 December 2021

Amounts in EUR thousands	Steel	Aluminium	Copper	Cables	Pipes	Steel Real Estate	Other activities	Total
Primary geographical markets
Greece	136,303	67,146	258,470	18,098	271,705	7,194	21,461	780,377
European Union	1,069,081	985,368	290,276	132,662	591,180	0	20,014	3,088,581
Other European countries	170,422	294,133	112,412	16,685	197,076	0	2,813	793,541
Asia	76,669	91,197	84,657	40,030	3,016	0	18,737	314,305
America	211,308	82,563	8,683	16,792	804	0	429	320,579
Africa	13,892	38,485	2,673	800	4,001	0	39	59,890
Oceania	243	4,883	0	0	0	0	640	5,767
Total	1,677,918	1,563,775	757,170	225,067	1,067,782	7,194	64,134	5,363,040
Timing of revenue recognition
Revenue recognised at a point in time	1,677,184	1,560,158	483,591	82,834	1,057,423	1,768	44,980	4,907,938
Products transferred over time	0	0	273,579	142,234	0	0	58	415,871
Services transferred over time	733	3,617	0	0	10,358	5,426	19,096	39,231
Total	1,677,918	1,563,775	757,170	225,067	1,067,782	7,194	64,134	5,363,040

For the year ended 31 December 2020

Amounts in EUR thousands	Steel	Aluminium	Copper	Cables	Pipes	Steel Real Estate	Other activities	Total
Primary geographical markets
Greece	96,823	49,858	259,584	15,240	175,495	0	21,748	618,748
European Union	761,195	634,020	205,829	211,177	364,535	0	16,049	2,192,804
Other European countries	107,535	223,322	51,533	21,300	131,248	0	1,721	536,661
Asia	61,979	74,598	48,729	0	621	0	14,507	200,433
America	127,597	50,759	861	49,040	142	0	204	228,603
Africa	12,332	30,107	2,028	8,065	5,898	0	44	58,475
Oceania	274	3,350	51	0	0	0	636	4,311
Total	1,167,735	1,066,014	568,615	304,824	677,939	0	54,909	3,840,036
Timing of revenue recognition
Revenue recognised at a point in time	1,166,810	1,061,661	323,657	30,873	671,971	0	36,689	3,291,661
Products transferred over time	0	0	242,198	273,736	0	0	737	516,670
Services transferred over time	925	4,353	2,760	215	5,968	0	17,483	31,704
Total	1,167,735	1,066,014	568,615	304,824	677,939	0	54,909	3,840,036

Viohalco’s consolidated revenue for 2021 amounted to EUR 5,375 million, increased by 40% compared to previous year (2020: 3,850 million), reflecting an upturn in demand across almost all segments and the rise in metal prices. Revenue expected to be recognised in the future related to performance obligations that are unsatisfied (or partially unsatisfied) at the reporting date amounts to EUR 222 million, from which EUR 196 million is expected to be recognised during 2022 and the remaining EUR 26 million is expected to be recognized during 2023 and onwards.

B. Contract balances

Contract assets primarily relate to the rights to consideration for work completed but not billed at the reporting date on customized products or energy projects. Contract assets are transferred to receivables when the rights become unconditional. This usually occurs when Viohalco companies issue an invoice to the customer (unless the invoice is issued in advance). Contract liabilities primarily relate to the advance consideration received from customers for construction of customized products or energy projects for which revenue is recognized over time. Contract assets mainly relate to cables and steel pipes segments, where amounts are billed as work progresses in accordance with agreed-upon contractual terms, either upon achievement of contractual milestones, or at the final delivery and acceptance of the products.

The following table provides information about contract assets and contract liabilities.

As at	31 December 2021	31 December 2020
Amounts in EUR thousands
Contract assets	101,371	68,517
Contract liabilities	-61,371	-54,021
Total	40,000	14,496

The movement in the contract assets and the contract liabilities balances during the period is described in the following table:

Amounts in EUR thousands	Contract assets	Contract liabilities
Balance at 1 January 2021	68,517	54,021
Increases due to unbilled receivables and changes in measure of progress	91,311	0
Revenue recognised relating to downpayments and deferred income balances as at the beginning of the period	0	-32,480
Transfers from contract assets recognised at the beginning of the period to receivables	-58,283	0
New downpayments and deferred income outstanding at year end	0	39,934
Impairment allowance	-175	0
Reversal of impairment allowance	0	0
Other movements	0	-96
Foreign exchange differences	0	-9
Balance at 31 December 2021	101,371	61,371

Amounts in EUR thousands	Contract assets	Contract liabilities
Balance at 1 January 2020

A. Other Income

For the year ended 31 December
Amounts in EUR thousands

	Note	2021	2020
Government grants/subsidies		5,650	2,212
Amortization of grants received		2,886	3,158
Rental income		647	774
Foreign exchange gains		0	50
Income from fees, commissions and costs recharged		1,357	2,047
Damage compensation		834	653
Gain on sale of PP&E and intangible assets		451	1,733
Gain on sale of investment property		476	0
Income from consulting services		0	451
Reversal of provisions	29	142	1,192
Reversal of impairment loss of PP&E and investment property	27	280	26,410
Gains from business combination		0	1,623
Income from valuation of options		0	936
Other		3,699	3,000
Total other income		43,422	44,240

B. Other Expenses

For the year ended 31 December
Amounts in EUR thousands

	Note	2021*	2020*
Impairment loss of PP&E and investment property		11,705	13,025
Write-off of PP&E and intangible assets		1,927	2,634
Loss on sale of PP&E		622	5
Loss on sale of investment property		0	143
Foreign exchange losses		0	309
Damages incurred		355	317
Other taxes		0	610
Employee benefits	12	358	1,205
Provisions on antidumping duties		12,842	0
Penalties		413	251
Depreciation and amortization		2,087	6,491
Other provisions		149	0
Other		3,523	4,546
Total other expense		34,003	29,536

Net other income/ expense (-) | | 9,419 | 14,704 |

*Restated figures due to the retrospective application of change in the method of attributing benefit to periods of service (IAS 19) (see Note 5.23)

Net other income/expenses for the year ended 31 December 2021 amounted to a gain of EUR 9.4 million compared to gain of EUR 14.7 million during 2020. This variation is mainly attributed to the following reasons:

• During 2022, the US Department of Commerce (DoC) published its final results in the administrative proceedings conducted by the DoC for the period from April 19, 2019 through April 30, 2020 (“POR”) in connection with an antidumping (“AD”) order on large diameter welded pipe (LDWP) from Greece. As a result, the DoC determined for the POR an antidumping duty rate of 41.04% based on total adverse facts available (AFA) for mandatory respondent Corinth Pipeworks S.A., Viohalco subsidiary operates in the steel pipes segment. Corinth Pipeworks intends to file an appeal before the U.S. Court of International Trade against the decision of the DoC while continuing to actively work with the DoC in order to reverse the final determination. The one-off charge related to the abovementioned case amounts to EUR 12.8 million (USD 14 million plus interest) and is included in ‘Provisions on antidumping duties’ line, as it relates to sales performed in previous years.

• During 2021, a reversal of impairment loss recognized in previous years of own used property and investment property amounting to EUR 15.7 million- on net basis - took place, due to increase in the fair value of real estate portfolio. Impairment loss and reversal of impairment loss are described in notes 17 and 19.

• During 2021, Viohalco subsidiaries received Covid-relief grants amounted to EUR 4.4 million.

C. Expenses by nature

For the year ended 31 December
Amounts in EUR thousands

	Note	2021	2020*
Cost of inventories recognized as an expense		3,812,652	2,620,977
Employee benefits	12	368,796	335,353
Energy		178,289	108,799
Depreciation and amortisation		140,688	128,686
Amortization of contract costs		156	342
Taxes and duties		19,097	14,975
Insurance expenses		25,559	28,808
Rental fees		5,303	5,449
Transportation costs (goods and materials)		147,833	122,556
Promotion and advertising		4,879	3,969
Third party fees and benefits		186,804	229,565
Other provisions		155	608
Gains (-)/losses from derivatives		10,843	16,498
Storage and packing		11,224	8,960
Commissions		13,820	11,281
Foreign exchange gains (-)/losses		451	3,186
Maintenance expenses		50,394	46,911
Royalties		2,371	1,814
Consumption of production tools		12,824	8,610
Other expenses		14,701	12,615
Total		5,006,838	3,709,963

*Restated figures due to the retrospective application of change in the method of attributing benefit to periods of service (IAS 19) (see Note 5.23)

The key drivers of variation of operating expenses during 2021 are the following:

• The increase in sales volumes and metal prices during 2021, affected cost of sales and related operating expenses which have increased proportionally.

• The increase in “Energy” and “Transportation” expenses reflects the global increase in energy cost that began within 2021.

• The decrease in “Third party fees and benefits” is attributed mainly to fees paid to subcontractors for coating services in the context of steel pipes projects and for installation services in the context of turnkey contracts executed and completed during 2020 by subsidiaries in the cables segment.

The aggregate amount of research and development expenditure recognized as an expense during 2021 amounts to EUR 13.3 million (2020: EUR 12.6 million).

9. Net finance cost

For the year ended 31 December
Amounts in EUR thousands

		2021	2020
Income
Interest income		557	842
Foreign exchange gains		950	661
Dividend income		220	146
Gain from derivatives		644	0
Finance income		2,371	1,648
Expense
Interest expense and related charges		94,574	89,143
Interest on leases		2,076	2,374
Foreign exchange losses		1,604	1,368
Losses from derivatives		0	853
Other finance expense		0	217
Finance cost		98,253	93,955
Net finance income/cost (-)		-95,882	-92,307

The increase of finance cost due to new loans facilities has been partially mitigated by the credit spread reductions that have been agreed gradually in all short and long term facilities across Viohalco companies during last years. As a result, interest expense and related charges have been increased by EUR 5.4 million.

10. Earnings per share

Considering that there are neither share options, nor convertible bonds, basic and diluted earnings per share are identical and have been based on the following profit attributable to the ordinary shareholders and weighted-average numbers of ordinary shares outstanding.

A. Profit/loss (-) attributable to ordinary shareholders

For the year ended 31 December
Amounts in EUR thousands

	2021*	2020*
Profit/loss (-) attributable to the owners of the Company	194,994	21,377

In thousands of shares
| | 2021 | 2020 |
|---|---|---|
| Issued ordinary shares at 1 January | 259,190 | 259,190 |
| Effect of shares issued related to the mergers | 0 | 0 |
| Weighted average number of ordinary shares at 31 December | 259,190 | 259,190 |

The number of equity shares in 2021 remains equal to 2020, as no shares were issued during the year.

C. Earnings per share

The basic and diluted earnings per share are as follows:

Earnings per share (in EUR per share)	2021	2020*
Basic and diluted	0.7523	0.0825

11. Employee benefits

Amounts in EUR thousands

	Note	2021	2020*
Net defined benefit liability		24,183	21,913
Liability for social security contributions	27	12,465	11,033
Total employee benefit liabilities		36,648	32,946
Non-current		24,183	21,913
Current		12,465	11,033

• Restated figures due to the retrospective application of change in the method of attributing benefit to periods of service (IAS 19) (see Note 5.23)

For details on the related employee benefit expenses, see Note 12.

A. Post-employment plans

The following post-employment plans exist:

Defined contribution plans
All employees of Viohalco companies are insured for their main pension by the respective social insurance organizations as required by the local legislation. Once the contributions have been paid, Viohalco companies have no further payment obligations. The regular contributions constitute net periodic costs for the year in which they are due, and as such are included in employee benefit expenses.

Defined benefit plans
The employees of Viohalco’s companies in some countries, mainly in Greece and Bulgaria, are entitled to receive a lump sum when they retire. This lump sum is determined in accordance with the years of service and the salary at the retirement date. This obligation meets the definition of defined benefit plans and charges the accumulated benefits through profit or loss in each period with a corresponding increase of the retirement liability.

VIOHALCO | ANNUAL REPORT 2021 147

Benefits paid to pensioners during each period are charged against this liability. Viohalco’s companies’ liability for personnel benefits as of 31 December 2021 and 2020 is EUR 24,183 thousand and EUR 21,913 thousand respectively. These plans are unfunded.

Effect of change in accounting policy

The IFRS Interpretations Committee (IFRIC) issued in May 2021 the final Decision on the agenda entitled "Attributing Benefits to Periods of Service in accordance with International Accounting Standard (IAS) 19", which includes guidance on how to distribute benefits in periods of service on a specific programme of defined benefits. Based on the above Decision, the way in which the basic principles of IAS 19 were generally applied in Greece in the past changed and consequently entities preparing financial statements in accordance with IFRS are required to amend their accounting policies accordingly. For further details, see note 5.23. Comparative information included in the tables below have been restated to reflect the change in accounting policy.

B. Movement in net defined benefit liability

The following table shows the reconciliation from the opening balance to the closing balances for net defined benefit liability and its components.

Amounts in EUR thousands

	2021	2020*
Balance at 1 January	21,913	37,362
Change in accounting policy	0	-16,961
Restated balance at 1 January	21,913	20,401
Included in profit or loss
Current service cost	2,118	2,025
Past service cost	230	-4
Termination loss	5,152	4,859
Interest cost/income (-)	58	136
	7,558	7,015
Included in OCI
Remeasurement loss/gain (-)
Actuarial loss/gain (-) arising from:
- Demographic assumptions	-46	228
- Financial assumptions	764	700
- Experience adjustments	345	129
	1,063	1,057
Other
Benefits paid	-6,344	-6,498
Loss of Control/Disposal of subsidiary	0	-57
Foreign exchange differences	-6	-5
	-6,350	-6,560
Balance at 31 December	24,183	21,913

During the financial year 2021, Viohalco and its companies paid EUR 6.3 million (2020: EUR 6.5 million) in benefits in respect of employees who left during the year. An additional cost that arose due to these payments was recognized (termination loss of EUR 5.2 million – 2020: EUR 4.9 million). More specifically, in the cases of dismissal, voluntary withdrawals with benefit payment and retirement, the additional cost is the difference between the benefit paid and the amount recorded in the defined benefit liability for the respective employees.

C. Defined benefit obligation

(a) Actuarial assumptions
The following were the weighted average principal actuarial assumptions at the reporting date:

	2021	2020*
Discount rate	0.31%	0.29%
Price inflation	2.06%	1.22%
Future salary growth	2.66%	1.82%
Plan duration (in years)	6	8

• Restated figures due to the retrospective application of change in the method of attributing benefit to periods of service (IAS 19) (see Note 5.23)

Assumptions regarding future mortality have been based on Swiss mortality table EVK2000.

VIOHALCO | ANNUAL REPORT 2021 148

(b) Sensitivity analysis
The sensitivity analysis for each significant actuarial assumption which was reasonably possible, at the end of the reporting period, shows how the defined benefit obligation (DBO) would have been affected by those changes as follows:

		2021	2020*
Sensitivity 1 (discount rate plus 0.5%)	- %	-2.95%	-3.37%
Difference in DBO
Sensitivity 2 (discount rate minus 0.5%)	- %	3.14%	3.58%
Difference in DBO
Sensitivity 3 (salary growth rate plus 0.5%)	- %	2.84%	3.36%
Difference in DBO
Sensitivity 4 (salary growth rate minus 0.5%)	- %	-2.70%	-3.15%
Difference in DBO

The above sensitivity analysis is based on a change in one assumption while all other assumptions remain constant. In practice, this is unlikely to occur, and changes in some of the assumptions may be correlated. When calculating the sensitivity of the defined benefit obligation to significant actuarial assumptions the same method (present value of the defined benefit obligation calculated with the projected unit credit method at the end of the reporting period) has been applied as when calculating the pension liability recognized on the statement of financial position. The methods and the formula of the assumptions used for the defined analysis have not changed compared to the previous year.

The expected maturity analysis of undiscounted pension benefits is as follows:

Amounts in EUR thousands

	2021	2020*
Less than a year	5,654	4,210
Between 1 and 2 years	1,432	1,411
Between 2 and 5 years	5,574	4,139
Over 5 years	13,195	15,410
Total	25,855	25,170

12. Employee benefit expenses

Amounts in EUR thousands

	Note	2021	2020*
Wages and salaries		283,576	257,577
Social security contributions		53,920	53,854
Defined contribution plans		1,152	1,214
Defined benefit plans	11	7,558	7,015
Other employee benefits		25,286	19,127
Total		371,492	338,787

Employee benefits have been allocated as follows:

	Note	2021	2020*
Cost of goods sold	8	258,985	235,571
Selling and distribution expenses	8	47,935	43,741
Administrative expenses	8	61,875	56,041
Other expenses	8	358	1,205
Capitalised employee benefits in projects under construction		2,338	2,229
Total		371,492	338,787

• Restated figures due to the retrospective application of change in the method of attributing benefit to periods of service (IAS 19) (see Note 5.23)

VIOHALCO | ANNUAL REPORT 2021 149

The number of employees, as well as their profile and gender, employed by Viohalco companies is presented in the following tables:

2021

	18 - 30	30-50	51+	Total
Male	986	4,715	2,518	8,219
Female	227	965	371	1,563
Number of Employees	1,213	5,680	2,889	9,782

	Office employees & professionals	Workers	Management	Total
Number of Employees	2,689	6,187	906	9,782

2020

	18 - 30	30-50	51+	Total
Male	895	4,711	2,321	7,927
Female	213	957	305	1,475
Total	1,108	5,668	2,626	9,402

	Office employees & professionals	Workers	Management	Total
Number of Employees	2,782	5,696	924	9,402

13. Income tax expense

A. Amounts recognised in profit or loss

Amounts in EUR thousands

	2021	2020*
Current tax	-46,550	-21,566
Deferred tax	-9,446	-4,936
Income tax expense (-)	-55,996	-26,502

*Restated figures due to the retrospective application of change in the method of attributing benefit to periods of service (IAS 19) (see Note 5.23)

B. Amounts recognised in OCI

2021

Amounts in EUR thousands

	Before tax	Related tax	Net of tax
Amounts recognized in the OCI
Remeasurements of defined benefit liability	-1,063	239	-823
Equity investments in FVOCI - net change in fair value	702	-17	684
Foreign currency translation differences	7,731	0	7,731
Gain / Loss (-) of changes in fair value of cash flow hedging - effective portion	4,839	-462	4,377
Gain / Loss (-) of changes in fair value of cash flow hedging - reclassified to profit or loss	-1,713	15	-1,699
Total	10,495	-225	10,270

2020*

Amounts in EUR thousands

	Before tax	Related tax	Net of tax
Amounts recognized in the OCI
Remeasurements of defined benefit liability	-1,057	174	-882
Equity investments in FVOCI - net change in fair value	-518	1	-517
Foreign currency translation differences	-11,155	0	-11,155
Gain / Loss (-) of changes in fair value of cash flow hedging - effective portion	2,174	-181	1,993
Gain / Loss (-) of changes in fair value of cash flow hedging - reclassified to profit or loss	1,857	-442	1,415
Total	-8,699	-448	-9,147

C.# Reconciliation of effective tax rate

Amounts in EUR thousands	2021	2020*
Profit/loss (-) before income tax expense	275,984	59,273
Statutory income tax expense rate in Greece	-60,717	-14,226
Non-deductible expenses for tax purposes	-9,936	-10,214
Tax-exempt income	4,770	5,398
Tax incentives	769	0
Recognition of previously unrecognised tax losses, thin capitalization allowance or temporary differences of a prior period	2,012	382
Effect of tax rates in foreign jurisdictions	8,738	-1,198
Current-year losses for which no deferred tax asset is recognised	-1,681	-2,507
Tax-exempt reserves recognition	660	0
Withholding tax on international dividends	-57	-61
Change in tax rate or composition of new tax	5,035	-548
Derecognition of previously recognised deferred tax assets	-4,874	-2,237
Prior year income tax adjustments	-714	-1,294
Income tax expense reported in the statement of profit or loss (-) at the effective tax rate	-55,996	-26,502

• Restated figures due to the retrospective application of change in the method of attributing benefit to periods of service (IAS 19) (see Note 5.23)

According to the Greek law N. 4646/2019, the corporate income tax rate for legal entities in Greece for the fiscal year 2021 and onwards is set at 22%. The consolidated effective tax rate for 2021 was 20% (2020: 45%). The effective income tax rate was influenced by the recalculation of deferred taxation due to the change in tax rate in Greece and the fact that certain loss-making subsidiaries did not recognize deferred tax on current year’s tax losses, while the current assessment regarding the recoverability of available tax losses to offset future taxable income in steel pipes segment led to the derecognition of deferred tax asset on previously recognised tax losses.

VIOHALCO | ANNUAL REPORT 2021 151

D. Movement in deferred tax balances

2021

Amounts in EUR thousands	Net balance at 1 January	Change in tax rate	Recognised in profit or loss	Recognised in OCI	Change in tax rate	Foreign recognised	Other recognised	Net balance at 31 December	Net assets	Net liabilities
Property, plant & equipment	-109,294	-5,500	0	-404	6,832	0	0	-108,365	281	-108,646
Right of use asset	97	-27	0	0	-65	0	0	5	424	-419
Intangible assets	1,159	-1,628	0	0	115	0	0	-354	1,820	-2,174
Investment property	-606	-2,189	0	0	196	0	0	-2,598	89	-2,688
Other investments	875	607	-4	0	7	-13	0	1,471	1,550	-79
Derivatives	-1,074	377	-390	-19	-70	-58	0	-1,233	462	-1,695
Inventories	-350	176	0	0	116	0	0	-58	192	-249
Loans and borrowings	-1,564	308	0	0	139	0	0	-1,117	216	-1,333
Employee benefits	4,284	-181	45	-1	-327	195	0	4,014	4,126	-111
Provisions / Accruals	4,016	2,724	0	-4	-268	0	0	6,468	6,468	0
Contract with customers	-12,625	-40	0	-10	918	0	0	-11,757	1,335	-13,092
Contract liabilities	-9	0	0	0	1	0	0	-9	0	-9
Other items	4,269	-992	0	-3	-183	0	7	3,099	4,274	-1,175
Thin capitalisation	30,499	-3,879	0	-2	-2,389	0	0	24,229	24,229	0
Tax losses carried forward	6,272	-4,236	0	36	12	0	0	2,083	2,085	-2
Tax assets/liabilities (-) before set-off	-74,051	-14,481	-349	-406	5,035	123	7	-84,122	47,552	-131,673
Set-off tax	-34,410	34,410
Net tax assets/liabilities (-)		13,141						-97,263

2020*

Amounts in EUR thousands	Net balance at 1 January	Loss	Change of tax rate	Recognised in profit or loss	Recognised in OCI	Foreign exchange differences	Disposal of subsidiary	Change in accounting policy	Other recognised	Net balance at 31 December	Net assets	Net liabilities
Property, plant & equipment	-107,111	-1,861	0	257	-69	-516	0	7	-109,294	2,207	-111,501
Right of use asset	-699	802	0	0	-6	0	0	0	97	459	-362
Intangible assets	1,514	-357	0	0	2	0	0	0	1,159	3,508	-2,349
Investment property	-615	11	-2	0	0	0	0	0	-606	1,859	-2,464
Other investments	850	25	1	0	0	0	0	0	875	961	-86
Derivatives	-64	-365	-623	11	0	-32	0	0	-1,074	534	-1,608
Inventories	547	-897	0	0	0	0	0	0	-350	866	-1,216
Loans and borrowings	-1,894	330	0	0	0	0	0	0	-1,564	461	-2,026
Employee benefits	8,037	82	176	-11	0	0	-3,999	0	4,284	6,813	-2,529
Provisions / Accruals	3,489	527	0	0	0	0	0	0	4,016	4,041	-25
Contract with customers	-7,617	-5,007	0	-1	0	0	0	0	-12,625	23	-12,648
Contract liabilities	-9	0	0	0	0	0	0	0	-9	0	-9
Other items	2,032	2,387	0	-114	-20	0	-58	41	4,269	5,356	-1,087
Thin capitalisation	26,799	3,704	0	-4	0	0	0	0	30,499	30,499	0
Tax losses carried forward	10,044	-3,770	0	-3	0	0	0	0	6,272	6,273	-1
Tax assets/liabilities (-) before set-off	-64,699	-4,389	-448	135	-93	-548	-4,057	48	-74,051	63,860	-137,912
Set-off tax	-46,654	46,654
Net tax assets/liabilities (-)		17,206							-91,258

*Restated figures due to the retrospective application of change in the method of attributing benefit to periods of service (IAS 19) (see Note 5.23)

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Deferred tax assets relating to tax losses carried forward are recognised only if it is probable that they can be offset against future taxable profits. At each balance sheet date, Viohalco and its subsidiaries assess whether the realization of future tax benefits is sufficiently probable based on approved business plans. On 31 December 2021, the accumulated tax losses carried forward available for future use amounted to EUR 80 million (31 December 2020 EUR 88 million). Viohalco companies have recognised cumulatively a deferred tax asset of EUR 2 million (31 December 2020: EUR 6 million) on tax losses because management considered it probable that future taxable profits would be available against which such losses can be used. EUR 0.4 million relate to Viohalco subsidiaries located in Greece and the rest EUR 1.6 million to subsidiaries in other jurisdictions. This deferred tax asset corresponds to losses equal to EUR 9 million (31 December 2020: EUR 27 million). Based on these estimates regarding future taxable profits, deferred tax assets have not been recognised in respect of tax losses carried forward for an amount of EUR 70 million (EUR 61 million in 2020). Out of these, tax losses equal to EUR 7 million expire in 2022 and 2023, while the rest expire between 2024 and 2026.

According to the provisions of articles 49 and 72 of the Greek Law 4172/2013 concerning thin capitalization, net interest expense is deductible from current year’s tax profits, if it is equal or less than 30% of EBITDA and any excess can be settled with future tax profits without time limitations. Based on the current approved business plans, the balance of the respective tax asset was equal to EUR 24.2 million, as at 31 December 2021 (31 December 2020: EUR 30.5 million).

14. Inventories

Amounts in EUR thousands	2021	2020
Merchandise	40,633	27,434
Finished goods	431,583	314,132
Semi-finished goods	282,538	198,326
By-products & scrap	83,955	64,183
Work in progress	34,684	20,991
Raw and auxiliary materials, consumables and packaging materials	596,448	449,523
Total	1,469,840	1,074,589

The amount of inventories recognised as expense during 2021 and included in ’Cost of sales‘ was EUR 3.8 billion (2020: EUR 2.6 billion). Inventories with a carrying amount of EUR 177 million are pledged as security for borrowings received by Viohalco’s companies (See Note 26).

15. Trade and other receivables

Amounts in EUR thousands	Note	2021	2020
Current Assets
Trade receivables		474,345	324,318
Less: Impairment losses		-53,964	-57,551
Net trade receivables		420,381	266,767
Advance payments		16,478	7,567
Cheques and notes receivables & cheques overdue		40,967	32,216
Receivables from related parties	38	41,570	40,216
VAT and other tax receivables		62,298	59,663
Receivables from dividends of equity-accounting investees	38	334	334
Other debtors		54,856	54,838
Less: Impairment losses		-13,348	-14,141
Net other receivables		203,155	180,692
Total current assets		623,536	447,459
Non-current assets
Non-current receivables from related parties	38	5,746	3,975
Other non-current receivables		1,568	6,374
Total non current assets		7,314	10,349
Total receivables		630,850	457,809

Viohalco and its companies have not concentrated their credit risk in relation to receivables from customers, since they have a wide range and a large number of customers.

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A. Transfer of trade receivables

The carrying amount of receivables includes amounts that are subject to factoring arrangements. Viohalco and its subsidiaries, enter into factoring agreements (with recourse) to sell trade receivables for cash proceeds. These trade receivables are not being derecognised from the statement of financial position, because substantially all the risks and rewards are still retained by Viohalco - primarily credit risk. The amount received on transfer by the factor is recognised as a secured bank loan. The following table presents the carrying amount of trade receivables at the year-end that have been transferred, but have not been derecognised and the associated liabilities.

Amounts in EUR thousands	2021	2020
Carrying amount of trade receivables transferred to banks	44,219	81,453
Carrying amount of associated liabilities	27,257	41,463

The fair value of trade receivables transferred approximates their carrying amount. As at 31 December 2021 and 2020, Viohalco companies had not used the total amount of credit line provided by the factoring companies. Related loans are included in the line ’Secured bank loans‘ in Note 26 ’Loans and Borrowings’.

B. Credit and market risks and impairment losses

During 2010, the subsidiary Corinth Pipeworks SA initiated in Greece and Dubai legal actions against a former customer in the Middle-East regarding the recovery of an overdue receivable of USD 24.8 million (EUR 22 million at 31 December 2021), plus legal interest. Following a series of court proceedings, the Dubai Court of Cassation issued its final judgment, during 2017, and ruled to reject any counterclaim of the former customer and to confirm the amount due to Corinth Pipeworks.# 16. Cash and cash equivalents

Amounts in EUR thousands

	2021	2020
Cash in hand and at banks	6,848	1,067
Short-term bank deposits	496,419	218,094
Total	503,267	219,161

Short term deposits have duration of less than 90 days and are available for use. In addition, cash and cash equivalents as at 31.12.2021 includes cash obtained from the issuance of EUR 120 million “Green bond” on 06.12.2021 in real estate segment, that will be used for the repayment of loan facilities related to environmentally certified properties and the financing of new “Green investments”.

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17. Property, plant and equipment

A. Reconciliation of carrying amount

Amounts in EUR thousands	Machinery & equipment	Furniture & other	Land, plants & buildings	Transportation equipment	PP&E under construction	Total
Cost
Balance as at 1 January 2021	1,007,315	2,793,597	76,081	154,824	4,031,817
Effect of movement in exchange rates	1,129	10,230	-25	330	11,663
Additions	31,301	26,990	4,129	186,746	249,167
Disposals	-2,710	-3,732	-188	-475	-7,105
Transfer to /from investment property	-210	0	0	0	-210
Reclassifications	29,420	94,977	1,237	-126,597	-962
Write offs	-267	-4,535	-1,836	-66	-6,705
Balance as at 31 December 2021	1,065,978	2,917,527	79,398	214,763	4,277,666
Accumulated depreciation & impairment losses
Balance as at 1 January 2021	-378,847	-1,631,552	-62,340	-4,983	-2,077,721
Effect of movement in exchange rates	-374	-6,543	13	0	-6,905
Depreciation	-22,990	-92,682	-5,015	0	-120,686
Disposals	1,582	2,633	137	0	4,352
Write offs	267	2,706	1,804	0	4,777
Reversal of previously recognized impairment loss	11,226	258	0	0	11,484
Impairment loss	-2,087	-664	-2	0	-2,753
Reclassifications	1	-1,085	-23	0	-1,107
Balance as at 31 December 2021	-391,222	-1,726,929	-65,426	-4,983	-2,188,560
Carrying amount as at 31 December 2021	674,756	1,190,598	13,971	209,781	2,089,107	2,089,107

Amounts in EUR thousands	Machinery & equipment	Furniture & other	Land, plants & buildings	Transportation equipment	PP&E under construction	Total
Cost
Balance as at 1 January 2020	949,993	2,610,463	72,400	224,846	3,857,702
Effect of movement in exchange rates	-1,610	-9,703	-80	-147	-11,540
Additions	4,867	20,927	3,979	173,707	203,478
Disposals	-236	-6,701	-214	-4,176	-11,328
Mergers and absorptions	2	0	29	0	30
Reclassifications	54,922	189,176	1,325	-238,065	7,357
Write offs	-227	-8,271	-940	-558	-9,996
Loss of control / Disposal of subsidiary	-395	-2,292	-418	-781	-3,887
Balance as at 31 December 2020	1,007,315	2,793,597	76,081	154,824	4,031,817
Accumulated depreciation & impairment losses
Balance as at 1 January 2020	-350,926	-1,564,060	-59,385	-5,110	-1,979,481
Effect of movement in exchange rates	709	5,889	56	0	6,654
Depreciation	-22,063	-89,652	-4,479	0	-116,194
Disposals	278	6,061	153	0	6,492
Mergers and absorptions	0	0	-29	0	-29
Write offs	179	6,188	938	127	7,431
Reversal of previously recognized impairment loss	9,821	164	0	0	9,985
Impairment loss	-1,299	0	0	0	-1,299
Reclassifications	-15,662	2,206	33	0	-13,422
Loss of control / Disposal of subsidiary	116	1,651	373	0	2,141
Balance as at 31 December 2020	-378,847	-1,631,552	-62,340	-4,983	-2,077,721
Carrying amount as at 31 December 2020	628,468	1,162,046	13,741	149,842	1,954,096	1,954,096

The net amount of EUR 2.1 million in ‘Reclassifications’ movement mainly concerns assets under construction reclassified to intangible assets and reclassifications from right of use assets.

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B. Security

Property, plant & equipment with a carrying amount of EUR 1,006 million are mortgaged as security for borrowings received by Viohalco’s companies (see Note 26).

C. Property, plant and equipment under construction

The most important additions in property, plant and equipment under construction as of 31 December 2021 concern the following:

• the six-high cold rolling mill and the new lacquering line installation in Oinofyta aluminium rolling plant;
• the new lacquering machine in Oinofyta aluminium rolling plant of ElvalHalcor,
• the construction of new lacquering machine of Symetal;
• machinery upgrades in Bridgnorth aluminium plant;
• the revamping of press in ElvalHalcor’s copper tube plant;
• the upgrade of press and the installation of a new billet pre-heating furnace at copper alloys extrusion division of ElvalHalcor;
• the installation of four new bell-shaped annealing bases and slitting line at Sofia Med’s plant in Bulgaria;
• the ongoing investments in the cables plant in Corinth;
• certain productivity and capacity improvement investments in Thisvi’s plant of steel pipes segment;
• steel segment’s additions like the meltshop filters installation, aiming to decrease the emissions and optimize the operation of the filters system along with other operational investments related to plants’ machinery upgrade.

They also include the revamping of the New Rolling Mill facility for the production of the whole range of Special Bar Quality products in Bulgaria.

Capitalized borrowing costs related to property, plant and equipment under construction amount to EUR 0.9 million (2020: EUR 4 million), which have been calculated using an average capitalization rate of 3.7% (2020: 2.4%). Additions in assets under construction also include capitalized employee benefits equal to EUR 2,338 thousand (2020: EUR 2,229 thousand).

D. Transfer to and from investment property

During 2021, Property plant and plant and equipment amounting of EUR 0.2 million were transferred to investment property.

E. Impairment loss of property, plant and equipment

On 31 December 2021, an impairment test was performed for each Cash Generating Unit (further CGU) for which indications of impairment loss existed as at 31 December 2021 concerning subsidiaries from steel segment. The identified indications of impairment concerned the losses incurred by certain CGUs over the last years. For the calculation of recoverable amount per CGU, cash flow projections based on a period of five years were used. The results of this test concluded that the property, plant and equipment used by these CGUs were not impaired at 31 December 2021, since the recoverable amount of each CGU exceeded the respective carrying amount. In addition, impairment losses of EUR 2.7 million where recognised mainly in the aluminium segment for specific fixed assets that indications of impairment were existed. The recoverable amount of related real estate assets amounted EUR 1.7 million. During 2021, machinery equipment with NBV equal to EUR 1.9 million (2020: EUR 2.1 million) were written off since they are no longer used by Viohalco companies and they are not expected to bring economic benefits in the future since these assets became obsolete. In addition, impairment tests were performed on real estate assets where indications of impairment exist, either owner occupied or held as investment property. The tests were carried out in order to address the risk of negative changes in the fair value of properties and respond if necessary. Valuation techniques and the results relating to investment properties are outlined in note 19.

F. Reversal of impairment loss of property, plant and equipment

A test has also been performed for CGUs, for which indications for reversal of previously recorded impairment loss existed at 31 December 2021. These indications concerned the improvement of expected performance of certain CGUs over the following years. However, the result of the test was that no impairment loss should be reversed in 2021. In addition, previously recognized impairment losses of EUR 11.5 million were reversed (recoverable amount EUR 54.6 million) and included in the line “Other Income” of the consolidated statement of profit or loss, related to Investment property that has been transferred to PP&E in the previous years. For segmental classification purposes, reversal of impairment losses reported in real estate segment.

G. Derecognition due to disposal of subsidiary

Assets amounting to EUR 1.7 million have been derecognized in 2020 due to the absorption of subsidiary Vianatt by Ecoreset S.A.

H. Change in estimates

During 2021, Viohalco subsidiary ElvalHalcor conducted an operational efficiency review on its plants, which resulted in changes in the expected useful life of specific buildings and machinery which are contributing in the production process of the aluminium division of the company.

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The factors taken into account for this operational review were the following:

• development and implementation of the investment programme of the company;
• the continued maintenance and development operations; and
• the future economic benefits that will be occurred from the cash inflows of the current equipment.

As a result:

• the expected useful life of buildings was extended by 5 years on average and
• the useful life of machinery was extended by 3 years on average.

Upon the application of the changes described above, the ranges of useful lives as described in the relative accounting policy remained unaffected. The effect of these changes on annual depreciation expense, included in ‘Cost of sales’, was EUR 1.1 million for 2021.

18. Goodwill and intangible assets

A.# INTANGIBLE ASSETS

Amounts in EUR thousands	Goodwill	Development costs and Trademarks	licenses	Software	Other	Total
Cost
Balance as at 1 January 2021	1,500	2,097	34,400	49,000	2,818	89,814
Effect of movement in exchange rates	0	-1	0	-95	-5	-101
Additions	0	0	1,581	4,289	102	5,972
Disposals	0	0	-1	-10	0	-11
Write-offs	0	0	-3	-183	0	-186
Reclassifications	0	-779	1,645	2,216	0	3,082
Balance as at 31 December 2021	1,500	1,317	37,622	55,216	2,915	98,570
Accumulated amortization and impairment loss
Balance as at 1 January 2021	-1,500	-1,097	-9,612	-37,200	-860	-50,269
Effect of movement in exchange rates	0	1	0	68	2	70
Amortization for the period	0	-137	-2,215	-4,269	-53	-6,673
Disposals	0	0	1	10	0	11
Write-offs	0	0	3	183	0	186
Impairment loss	0	0	0	-79	0	-79
Reclassifications	0	608	0	-341	0	267
Balance as at 31 December 2021	-1,500	-626	-11,823	-41,626	-912	-56,487
Carrying amount as at 31 December 2021	0	691	25,799	13,589	2,004	42,083

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Amounts in EUR thousands	Goodwill	Development costs and Trademarks	licenses	Software	Other	Total
Cost
Balance as at 1 January 2020	3,132	2,024	29,282	43,163	2,747	80,348
Effect of movement in exchange rates	0	-1	-1	-84	-8	-94
Additions	0	23	1,316	4,840	111	6,290
Disposals	0	0	0	-13	0	-13
Write-offs	0	0	0	-192	0	-192
Mergers and absorptions	0	0	0	6	0	6
Loss of Control/Disposal of subsidiary	-1,632	0	0	-82	0	-1,714
Reclassifications	0	51	3,803	1,362	-32	5,183
Balance as at 31 December 2020	1,500	2,097	34,400	49,000	2,818	89,814
Accumulated amortization and impairment loss
Balance as at 1 January 2020	-1,500	-812	-7,484	-33,489	-837	-44,122
Effect of movement in exchange rates	0	1	1	47	7	55
Amortization for the period	0	-285	-1,985	-4,045	-61	-6,376
Disposals	0	0	0	3	0	3
Write-offs	0	0	0	123	0	123
Mergers and absorptions	0	0	0	-6	0	-6
Loss of Control/Disposal of subsidiary	0	0	0	50	0	50
Reclassifications	0	0	-144	116	32	3
Balance as at 31 December 2020	-1,500	-1,097	-9,612	-37,200	-860	-50,269
Carrying amount as at 31 December 2020	0	1,000	24,788	11,800	1,958	39,545

B. Amortisation
The amortization of trademarks and licenses with finite useful lives, software programmes and other intangible assets is allocated to the cost of inventory and is included in ’Cost of sales‘ when inventory is sold, as trademarks and licenses and software programmes are mainly used directly for the production of products and they are considered as production overheads. The amortization of intangible assets not used for production is allocated to administrative expenses.

C. Reclassifications
Reclassifications mainly relate to intangible assets recorded initially in projects under construction (in property, plant and equipment) and upon the completion of the project, they are transferred to the column which describes their nature.

D. Goodwill
Goodwill of amount EUR 1.6 million was derecognized in 2020 due to the absorption of subsidiary Vianatt by Ecoreset S.A. No additional Goodwill has been recognized during 2021.

E. Intangible assets with indefinite useful lives
All intangible assets have finite useful life (see Note 5.10), except for the following assets, included in trademarks and licenses category:

i. Intangible assets recognized for the CGU “Fulgor”
a. Trade Name “Fulgor” (carrying amount of EUR 1.4 million as at 31 December 2021)
It relates to the sector of medium voltage submarine cables and terrestrial high voltage cables that Fulgor was operating prior to its acquisition by Hellenic Cables in 2011 and which has revealed significant economic benefits. Based on the analysis of relevant factors (e.g. knowledge, no longstanding engagement with a wide range of clientele, future development of the sector), the useful life of the brand was considered indefinite.
b. License of Port use in Soussaki, Corinth (carrying amount of EUR 8.3 million as at 31 December 2021)
Fulgor holds a license for permanent and exclusive use of a port located in the premises of the factory in Soussaki, Corinth. The port is necessary for the production of submarine cables of medium and high voltage. Since the acquisition of the subsidiary, significant investments for the upgrade and expansion of production capacity in producing high-voltage submarine cables took place. Since 2014, the production started as planned. The useful life of the asset is considered indefinite, since the use of these port facilities is for an indefinite period of time, in the context of the significant development of the sector.

ii. Intangible assets recognized for the CGU “Reynolds” (carrying amount of EUR 1.5 million as at 31 December 2021).
Upon the completion of the acquisition of Reynolds Cuivre by Genecos, an intangible asset related to the brand name “Reynolds” was recognized, as significant economic benefits are expected from its use. Based on the analysis of relevant factors (e.g. knowledge of the relevant market, wide range of clientele, expected future developments), the useful life of the brand was considered indefinite.

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F. Impairment testing

(a) Intangible assets recognized for the CGU “Fulgor”
As these intangible assets do not generate independent cash inflows, it was considered appropriate to carry out the impairment test on the basis of the Cash Generating Unit (CGU) of Fulgor submarine cables production plant, which incorporates these assets. In order to evaluate the value in use, cash flow projections based on estimates by management covering a five-year period (2022 – 2026) were used. These estimates take into consideration the contracts already signed, as well as contracts estimated to be awarded in Greece and abroad. The submarine cables CGU operates in a project-based business. Therefore, assumptions related to revenue and profitability growth are based on the contracts already signed, as well as those estimated to be undertaken in the forthcoming period. The main assumptions regarding the operations of submarine cables CGU and the projects to be executed within the five-year period are:
• Progressively high capacity utilization of Corinth plant owed by Fulgor, as in 2020 & 2021, based on contracts already awarded & expected awards based on tendering activity. Given the continued growth, the existing backlog, the growth of renewables business around the world, which is a significant driver in the attractive outlook for the offshore power generation market, the continuously high level of activity is expected to be retained throughout the period 2022-2026.
• Capital expenditure of approx. EUR 102 million in the following 5 years, in order to cover estimated production and capacity needs. Capital expenditure reflects investments for both maintenance purposes and expectations of organic growth. For the terminal period, the investments are set equal to depreciation.
• Compound annual growth rate of revenue from offshore business for the five-year period at ca. 3.8% attributable to assignment of new projects mainly in Greece, North Europe and the USA.
• Profitability per offshore project in terms of EBITDA at ca. 15%-25% of revenue. Estimated profitability per project varies mainly due to different type of cable and technical specifications, geographic region and project’s timeframe.
• Compound annual growth rate of fixed operating expenses at ca. 2.1% for the five-year period.
Cash flows after the first five years were calculated using an estimated long term growth rate of 1.55%, which mainly reflects management's estimates for the world economy as well as long-term growth prospects of the offshore cable sector. The pre-tax rate used to discount these cash flows is 7.71% was based on the following:
• Risk free rate was determined to zero.
• The country risk for operating in Greece determined to 0.81%.
• The market risk premium was determined to 4.87%, i.e. stable compared to prior year’s impairment test.
Despite the fact that the commodity prices for copper and aluminium are part of the assumptions for the impairment test performed, due to the hedging activities undertaken and the customized nature of the products sold by Fulgor, the value of the business unit is not significantly affected by fluctuations in commodity prices. Neutral result from metal price fluctuations is assumed in the context of the impairment test. The results of this test indicated that the recoverable amount as of 31 December 2021 exceeds the carrying amount of the CGU amounting to EUR 219 million by EUR 524 million. A sensitivity analysis was carried out on the key assumptions of the model (discount rates and growth in perpetuity), to examine the adequacy of the headroom. The result of the sensitivity analysis indicated that the recoverable amount still exceeds the carrying value of the CGU. Assumptions may change as follows so as the recoverable amount equals the carrying amount:

Assumptions used	Change in rates (percentage points change) required for the recoverable amount to equal the carrying amount
Discount rate 7.71%	+12.0 ppc
Terminal growth 1.55%	-61.8 ppc

(b) Intangible assets recognized for the CGU “Reynolds”
The recoverable amount of the CGU that includes this intangible asset (Reynolds Cuivre S.A.) was estimated based on the present value of the future cash flows expected to be derived from the CGU (value in use). Cash flows after the first five years were calculated using an estimated growth rate of 0.5%, which reflects management's estimates for the growth prospects for the market. The after-tax rate used to discount these cash flows is 7.6% for the five year period and for the terminal value and was based on the following:
• Risk free rate was capped to zero.
• The market risk premium (including the country risk for operating in France) was determined at 5.36%
Average annual revenue growth rate for the five-year period is 3.2%, and the average annual operating expenses decrease percentage is 2.3%. Average capex equal to EUR 106 thousand.The results of this test indicated that the recoverable amount as at 31 December 2021 exceeds the carrying value of the CGU amounting to EUR 8.9 million by EUR 4.2 million. VIOHALCO | ANNUAL REPORT 2021 159 A sensitivity analysis was carried out on the key assumptions of the model (discount rates and growth in perpetuity), so as to examine the adequacy of the headroom. The result of the sensitivity analysis indicated that the recoverable amount still exceeds the carrying value of the CGU. Results of the sensitivity analysis for the impairment testing:

Assumptions used	Change in rates (percentage points change) required for the recoverable amount to equal the carrying amount
Discount rate	+2.3ppc
Terminal growth	-3.1ppc

19. Investment property

A. Reconciliation of carrying amount

Amounts in EUR thousands
| | 2021 | 2020 |
| :----------------------- | :------ | :------ |
| Balance as at 1 January | 270,413 | 195,003 |
| Acquisitions | 10,887 | 75,110 |
| Disposals | -753 | -243 |
| (Impairment losses) / Reversal of impairment losses | 6,922 | 4,700 |
| Modifications | 95 | 0 |
| Transfers to property, plant and equipment | -1 | 0 |
| Transfers from property, plant and equipment | 210 | 0 |
| Depreciation | -6,898 | -4,157 |
| Balance as at 31 December | 280,876 | 270,413 |
| Gross carrying amount | 324,684 | 315,420 |
| Accumulated depreciation and impairment losses | -43,807 | -45,007 |
| Net carrying amount as at 31 December | 280,876 | 270,413 |

Investment property comprises of a number of commercial and industrial properties that are either leased to third parties currently or will be in the foreseeable future. Each of these leases is indexed to consumer prices. During 2021, Viohalco invested an amount of EUR 11 million (EUR 75 million in 2020) for the acquisition and improvement of investment properties.

B. Measurement of fair value – Impairment loss and subsequent reversal

On December 31st 2021, an impairment test was performed on all real estate assets (individual assets), either owner occupied or held as investment property. The tests were carried out in order to address the risk of negative changes in the fair value of properties and respond if necessary. The results relating to owner occupied properties are outlined in note 17. For investment property assets, an impairment loss of EUR 8.9 million was recorded and included in the line ’Other expense‘ of the consolidated statement of profit or loss. Impairment losses relate primarily to land and buildings, and the recoverable amount was based on its fair value less costs of disposal. The fair value of these properties was determined by external, independent property valuers, having appropriate recognized professional qualifications and recent experience in the location and category of the properties being valued. Valuation techniques are described in detail in the next paragraph. For segmental classification purposes, the impairment loss (recoverable amount EUR 3.7 million) was reported in real estate segment. Asset valuations were also used to identify if previously recognized impairment losses could be reversed. As a result, EUR 15.8 million were reversed and included in the line ’Other Income‘ of the consolidated statement of profit or loss. The recoverable amount of these assets as at 31 December 2021 was EUR 232 million and they relate to the real estate. The accumulated impairment losses carried forward as at 31 December 2021, amounts to EUR 30.2 million (31 December 2020: EUR 37.1 million). The fair value of all properties reported in the line ’Investment property‘, as at 31 December 2021, is EUR 355 million (31 December 2020: EUR 322 million).

Valuation techniques and significant unobservable inputs (Level 2 & 3)

The fair value measurement for investment property has been categorized as a Level 2 and 3 regarding fair value hierarchy, based on the inputs to the valuation techniques used. VIOHALCO | ANNUAL REPORT 2021 160 Valuations methods used to determine the fair value of these properties were reflecting the highest and best possible use.

• For buildings currently rented or expected to be rented out in the foreseeable future for which no observable prices were available, the income approach (either Discounted Cash Flow or Direct capitalization) method was used.
• DCF method considered the present value of net cash flows to be generated from each property, taking into account expected rental growth rate, void periods, occupancy rate, lease incentive costs such as rent-free periods and other costs not paid by tenants. The expected net cash flows are discounted using risk-adjusted discount rates that ranged between 7,90 % - 12,00 %. Among other factors, the discount rate estimation considers the quality of each building, its location, tenant credit quality, lease terms and the expected market return. The estimated fair value would decrease if either the expected market rental growth was lower or the risk-adjusted discount rates were higher.
• Direct capitalization uses an All-Risk Yield in order for the current annual estimated rental value to be capitalized. ARY ranged between 5,00% - 12,50% and offers a holistic assessment of the property market's general condition.
• For buildings, which were under construction and which are intended to be used as investment property in the future, the residual method was primarily used. The fair value determined by this method reflects the value of the property in its current condition.
• For all the properties, the comparative method (market approach) was used. According to this method the valuer estimates the market value of the subject asset by comparing the factors that mostly affect it. Such factors can be location, size, quality of construction etc. This method is based on estimation of the market price and what has been paid for similar properties under similar economic conditions. Each property is valued at a price at which similar ones in the area have recently sold with a subjective differential added (or subtracted) to adjust for the unique characteristics of the property that make it different from the benchmark properties, such as location, size, accessibility etc. The specific valuation technique has been classified as Level 2, regarding the fair value measurement hierarchy.

20. Equity-accounted investees

A. Reconciliation of carrying amount of associates and joint ventures

Amounts in EUR thousands
| | 2021 | 2020 |
| :------------------------------- | :----- | :----- |
| Balance as at 1 January | 38,089 | 37,742 |
| Share of profit / loss (-) net of tax | -2,530 | -1,740 |
| OCI profit (loss) for the period | 1 | 0 |
| Dividends received | -886 | -1,139 |
| Effects on movement in exchange rates | 671 | -3,319 |
| Additions | 225 | 3,285 |
| Share capital increase | 8,800 | 4,000 |
| Reclassifications | 0 | -739 |
| Balance as at 31 December | 44,372 | 38,089 |

B. Financial information per associate and joint venture

The following tables present financial information per associate. The disclosed financial information reflects amounts in the financial statements of the relevant associates.

2021

Associate/ Company	Principal place of business	Segment	Carrying Value	Current Assets	Current Liabilities	Current Revenue	Profit or loss from continuing operations	Direct Ownership interest	Non-controlling Ownership interest	Ultimate Ownership interest
ETEM GESTAMP AUTOMOTIVE SA	Bulgaria	Aluminium Joint Venture	8,095	9,465	16,390	230	14,177	49.00%	49.00%
DOMOPLEX LTD	Cyprus	Steel Associate	1,165	3,756	2,186	547	2,966	6,811	806	45.00%
AO TMK-CPW	Russia	Steel Pipes Associate	11,216	64,836	5,004	23	46,926	70,009	1,910	49.00%
BELLVILLE TUBE	USA	Steel Pipes Associate	1,732	422	13,744	3,418	3,988	20,238	-2,837	19.40%
AWM SPA	Italy	Steel Associate	3,643	8,701	8,281	3,928	5,301	5,142	-698	34.00%
HC ISITMA Α.S.	Turkey	Copper Joint Venture	231	338	146	46	92	572	54	50.00%
U.E.H.E.M GmbH	Germany	Aluminium Associate	767	9,317	26	0	7,834	53,775	1,074	49.00%
NEDZINK B.V.	Netherlands	Copper Joint Venture	11,841	31,325	49,598	43,186	28,940	86,636	-8,192	50.00%
THE GRID SA	Greece	Real estate Joint Venture	5,681	2,403	28,605	19,600	47	0	-688	50.00%
Total			44,372

VIOHALCO | ANNUAL REPORT 2021 161

2020

Associate/ Company	Principal place of business	Segment	Carrying Value	Current Assets	Current Liabilities	Current Revenue	Profit or loss from continuing operations	Direct Ownership interest	Non-controlling Ownership interest	Ultimate Ownership interest
ETEM GESTAMP AUTOMOTIVE SA	Bulgaria	Aluminium Joint Venture	7,439	7,012	14,646	101	11,450	27,643	134	49.00%
DOMOPLEX LTD	Cyprus	Steel Associate	866	2,897	2,043	560	2,615	4,264	457	45.00%
AO TMK-CPW	Russia	Steel Pipes Associate	9,965	25,397	4,734	0	9,794	41,141	1,775	49.00%
BELLVILLE TUBE	USA	Steel Pipes Associate	2,162	1,975	14,200	3,428	3,773	14,548	-4,826	19.40%
AWM SPA	Italy	Steel Associate	3,688	8,863	7,400	5,500	3,712	12,352	-351	34.00%
HC ISITMA Α.S.	Turkey	Copper Joint Venture	321	359	247	42	36	594	83	50.00%
U.E.H.E.M GmbH	Germany	Aluminium Associate	713	9,219	23	0	7,843	37,974	923	49.00%
NEDZINK B.V.	Netherlands	Copper Joint Venture	12,937	25,959	49,083	29,255	32,561	79,602	-4,623	50.00%
Total			38,089

On January 28th 2021, Viohalco subsidiary, Noval Property REIC, participated by 50% in the establishment of a joint venture named “The Grid S.A.”, which operates in the real estate development sector. Aforementioned financial information is presented considering the following:
(a) There are no restrictions on the ability of joint ventures or associates to transfer funds to the entity in the form of cash dividends, or to repay loans or advances made by the entity.
(b) The financial statements of joint ventures or associates are used in applying the equity method and as of the same date with that of Viohalco.
(c) There are no unrecognized share of losses of a joint venture or associate, both for the reporting period and cumulatively.

C. Description of associates and joint ventures

UEHEM (UACJ ELVAL HEAT EXCHANGER MATERIALS GmbH) is a joint establishment between ElvalHalcor and UACJ Corp.# 21. Other investments

Viohalco designates the investments shown below as equity securities at FVOCI, as they represent investments that Viohalco intends to hold for the long term strategic purposes. The movement of equity securities, as well as their analysis, is presented below:

Amounts in EUR thousands	2021	2020
Balance as at 1 January	8,324	5,829
Additions	77	3,069
Disposals	-637	-24
Change in fair value through OCI	702	-518
Reclassifications	0	-29
Other changes	-8	-2
Balance as at 31 December	8,457	8,324

Amounts in EUR thousands	2021	2020
Listed securities
- Greek equity instruments	125	125
- International equity instruments	4,417	3,713
- Mutual funds	0	639
Unlisted securities
- Greek equity instruments	2,951	2,946
- International equity instruments	849	849
- Mutual funds	94	30
- Other	20	20
Total	8,457	8,324

22. Assets held for sale

The amount of EUR 0.4 million is the book value of machinery in the aluminium segment classified in 2021 as asset held for sale, according to IFRS 5. Management has set a plan for the sale of this equipment which is expected to take place in 2022.

23. Derivatives

The following table sets out the carrying amount of derivatives:

Amounts in EUR thousands	2021	2020
Non-current assets
Future contracts	0	64
Options	944	871
Total	944	936
Current assets
Forwards	760	1,889
Future contracts	7,670	5,336
Commodity Swaps	7,847	0
Total	16,277	7,225
Non-current liabilities
Interest rate swap contracts	382	1,026
Future contracts	0	270
Commodity Swaps	3,205	0
Total	3,587	1,295
Current liabilities
Forwards	2,501	659
Future contracts	5,062	4,593
Total	7,563	5,252

Hedge accounting

Viohalco’s companies hold derivative financial instruments for cash flow and fair value hedges. The abovementioned derivative financial instruments cover risks from:

• Changes in the prices of metals
• Fluctuations of foreign exchange rates
• Changes in loan interest rates
• Fluctuations of energy prices (natural gas)

The maturity and the nominal value of derivatives held by Viohalco’s companies match the maturity and nominal value of the underlying assets / liabilities (hedged items).

Derivatives held by Viohalco’s companies concern mainly:

• Future contracts to hedge the risk from the change of the price of metals listed in LME (London Metal Exchange) and used in production of Viohalco’s companies (i.e. mainly copper, aluminium and zinc). Such hedges are designated as cash flow hedges.
• FX Forward and FX swaps to hedge the risk from the change in exchange rate of US Dollar and British Pound (i.e. currencies to which Viohalco’s companies are mainly exposed). Such hedges are either designated as fair value or cash flow hedges depending on the item hedged. FX Forwards and FX swaps when used for hedging FX risk on outstanding receivables and suppliers denominated in foreign currency these instruments are designated under fair value hedging. FX forwards when used for hedging FX risk on the forecasted sales of goods or purchase of materials executed in foreign currency FX forward is hedging instruments designated under the cash flow method.
• Commodity Swaps referenced on the Title Transfer Facility (TTF) prices to hedge the risk of fluctuations in natural gas prices from market conditions.

Derivatives are recognised when Viohalco’s companies enter into the transaction in order either to hedge the fair value of receivables, liabilities or commitments (fair value hedges) or highly probable transactions (cash flow hedges). The change in fair value recognized in equity under cash flow hedging as at 31 December 2021 will be recycled to the consolidated statement of profit or loss during the next years, as some of the hedged events are expected to occur (the forecasted transactions will take place or the hedged items will affect profit or loss statement) within 2022 and some others at a later stage.

Viohalco companies’ results from the hedging activities recorded in the statement of profit or loss are presented for metal future contracts, foreign exchange contracts and the energy contracts in the ’Revenue‘ and the ’Cost of sales‘ while for interest rate swaps in the ’Finance income/ expenses’. The amounts recognized in the consolidated statement of profit or loss are the following:

Amounts in EUR thousands	2021	2020
Gain / loss (-) on future contracts	-5,105	-14,174
Gain / loss (-) on FX forward contracts	-3,754	519
Gain / loss (-) on commodity swap contracts	1,251	0
Gain / loss (-) on options	0	-67
	-7,608	-13,721

Profit or loss related to derivatives used for cash flow hedging recognized in other comprehensive income (Hedging reserve) as at 31 December 2021 and it will be recycled to profit or loss during the next financial years.

Options related to the associate Bellville Tube Company

Based on the purchase agreement of Bellville Tube Company’s shares signed in 2020, the shareholders of Bellville Tube Company granted CPW America with a call option to purchase the remaining outstanding capital stock of Bellville Tube Company. The calculation of the purchase price prescribed in the call option is based on a predetermined formula. The exercise period for the call option starts in 2022 and expires in 2025. Upon the exercise of the call option CPW America will own 100% of outstanding capital stock of Bellville Tube Company.

In addition, the purchase agreement prescribes that if CPW America does not exercise the call option described above, CPW America shall have the option (“put option”), but not the obligation, during the period 2022-2025 to require Bellville Tube Company to redeem all, but not less than all, of the shares of Bellville Tube Company then held by CPW America. The aggregate purchase price for the redeemed shares if the put option is exercised will be USD 3.3 million, i.e. equal to the amount initially disbursed.

The options described above were recognized on the statement of financial position. Based on the inputs used to determine the fair value of the put and the call options, such options are categorized as Level 3. The options are valuated in USD and based on year end exchange rates, the valuation of such options was EUR 944 thousand. The valuation of the call & put options was based on a widely acceptable pricing model methodology considering the complexity of the option plan. The basic inputs that have been used in the valuation model are the following:

• Fair value of the share held in the associate, which in turn is dependent on expected turnover, EBITDA margins and future working capital needs of the associate.
• Applicable discount rate.
• Probability of default of the counterparty.

Regarding the fair values of the call and put options, reasonably possible changes at the reporting date to one of the significant unobservable inputs stated below, keeping other inputs constant, would have the following effect:

• If the discount rate was higher by 1%, then the fair value of the options would be lower by EUR 6 thousand or 0.6%.
• If the fair value of the shares held was higher by 10%, then the fair value of the options would be lower by EUR 146 thousand or 15.3%.
• If probability of default of the counterparty was higher by 10%, then the fair value of the options would be lower by EUR 255 thousand or 26.6%.

24. Capital and reserves

A. Share capital and share premium

The share capital of the Company amounts to EUR 141,894 thousand divided into 259,189,761 shares without nominal value. Holders of shares are entitled to one vote per share at the general meetings of the Company. Share premium of the Company amounts to EUR 457,571 thousand.

B. Translation reserve

The translation reserve comprises all foreign currency differences arising from the translation of the financial statements of foreign operations.

C. Nature and purpose of other reserves

(a) Statutory reserve

Pursuant to the Belgian tax legislation, the companies are obliged, from their fiscal year profits, to form 5% as a legal reserve until it reaches 10% of their paid share capital. The distribution of the legal reserve is prohibited. Pursuant to Greek company law, the companies are obliged to allocate each year at least 5% of its annual net profits to its statutory reserve, until this reserve equals at least 1/3 of the company’s share capital. The distribution of the statutory reserve is prohibited but it can be used to offset losses.(b) Hedging reserve
The effective portion of the cumulative net change in the fair value of hedging instruments used in cash flow hedges pending subsequent recognition in profit or loss as the hedged cash flows affect profit or loss.

(c) Other fair value reserve
The cumulative net change in the fair value of the equity securities until the assets are derecognized (and therefore transferred to retained earnings).

(d) Special reserves
This category relates to reserves formed by the application of the provisions of certain developmental laws which were granting tax benefits to companies that invested their retained earnings rather than distribute them to the shareholders. More specifically, the aforementioned reserves include profits that have already been taxed or have been permanently exempted from income tax, after the lapse of a specified period beginning from the completion of the investments they concern.

(e) Tax exempt reserves
This category relates to reserves formed by the application of the provisions of certain tax laws and are exempt from income tax, provided that they are not distributed to the shareholders. In case these reserves are distributed, they will be taxed using the tax rate applying at such time.

D. Reconciliation of other reserves

Amounts in EUR thousands	Statutory reserves	Hedging reserves	Other Fair Value reserve	Special reserves	Tax exempt reserves	Other reserves	Total
Balance as at 1 January 2021	42,039	2,483	1,359	81,496	296,785	11,942	436,104
Other comprehensive income	0	2,282	704	0	0	-1	2,985
Capitalization of reserves	2,719	0	0	153	527	-2,248	1,150
Acquisition of NCI	196	3	-2	2	132	0	331
Change in ownership interests	64	-105	0	-111	-16	35	-133
Balance as at 31 December 2021	45,018	4,662	2,061	81,540	297,428	9,728	440,437

VIOHALCO | ANNUAL REPORT 2021 165

Amounts in EUR thousands	Statutory reserves	Hedging reserves	Other Fair Value reserve	Special reserves	Tax exempt reserves	Other reserves	Total
Balance as at 1 January 2020	39,955	-728	1,875	80,139	296,653	8,713	426,607
Other comprehensive income	0	3,210	-516	0	0	-4	2,690
Capitalization of reserves	2,117	0	0	1,357	133	0	3,607
Loss of Control/Disposal of subsidiary	-33	0	0	0	0	0	-33
Change in ownership interests	-1	0	0	0	0	-38	-39
Mergers and absorptions	0	0	0	0	0	3,271	3,271
Balance as at 31 December 2020	42,039	2,483	1,359	81,496	296,785	11,942	436,104

Mergers and absorptions are further explained in note 32.

1. Capital management

Viohalco and its companies’ policy consists in maintaining a strong capital structure, so as to keep the confidence of investors, creditors and the market and enable the future development of their activities. The Board of Directors monitors the return on capital which is defined as net results divided by total equity less non-controlling interests. The Board of Directors also monitors the level of dividends distributed to holders of ordinary shares. The Board of Directors tries to maintain an equilibrium between higher returns that would be feasible through higher borrowing levels and the advantages and security offered by a strong and robust capital structure. In this context, the Board of Directors monitors, the Return on Capital Employed (ROCE) index, otherwise the Return on Invested Capital (ROIC) index, which is defined as Earnings before Interest and Tax (EBIT) divided by total Capital Employed, (i.e. equity and debt). The Board of Directors seeks opportunities and examines feasibility to leverage Viohalco’s companies with relatively high ROCE (in every case higher than the cost of debt) and deleverage companies that go through a relatively low ROCE performance period.

1. Loans and borrowings

A. Overview

Amounts in EUR thousands	31 December 2021	31 December 2020
Non-current liabilities
Secured bank loans	119,994	161,357
Unsecured bank loans	69,524	82,530
Secured bond issues	455,719	558,078
Unsecured bond issues	648,856	200,021
Loans and borrowings – Long term	1,294,093	1,001,986
Lease Liabilities – Long term	34,639	41,276
Total Long-term debt	1,328,732	1,043,262
Current liabilities
Secured bank loans	183,484	147,210
Unsecured bank loans	459,179	432,697
Current portion of secured bank loans	63,553	51,153
Current portion of unsecured bank loans	15,473	14,657
Current portion of secured bond issues	82,388	69,676
Current portion of unsecured bond issues	44,068	30,617
Loans and borrowings – Short term	848,145	746,010
Lease Liabilities – Short term	10,696	10,935
Total Short term debt	858,841	756,945
Total loans and borrowings	2,187,573	1,800,207

Information about the Viohalco companies’ exposure to interest rate, foreign currency and liquidity risk is included in Note 30.

VIOHALCO | ANNUAL REPORT 2021 166

Amounts in EUR thousands	2021	2020
Between 1 and 2 years	251,691	367,571
Between 2 and 5 years	575,669	556,840
Over 5 years	501,372	118,850
Total	1,328,732	1,043,262

The effective weighted average interest rates of the main categories of loans and borrowings at the reporting date are as follows:

2021	Carrying amount	Interest rate	2020	Carrying amount	Interest rate
Bank loans (non-current)-EUR	260,465	2.46%	Bank loans (non-current)-EUR	229,293	2.90%
Bank loans (current)-EUR	574,039	3.39%	Bank loans (non-current)-USD	235	1.00%
Bank loans (current)-USD	10,110	4.50%	Bank loans (current)-EUR	543,727	3.66%
Bank loans (current)-GBP	36,372	3.17%	Bank loans (current)-USD	5,042	2.26%
Bond issues-EUR	1,231,031	2.94%	Bank loans (current)-GBP	7,735	2.75%
			Bond issues-EUR	858,391	3.45%

The majority of Viohalco companies’ loans are Euro denominated. During 2021, Viohalco subsidiaries obtained new bank loans amounting to EUR 897 million and repaid bank loans of EUR 514 million maturing within the year. The new loans were mainly bond loans and drawdowns from existing revolving credit facilities for project financing, or new loans with similar terms and conditions. More specifically, during 2021 the main events relating to Viohalco companies’ financing are the following:

Aluminium and Copper segments
* ElvalHalcor issued a common five-year bond loan amounting to EUR 40 million with a major Greek bank, to finance current and general business needs.
* ElvalHalcor bond loan of Euro 250 million commenced trading in the Athens Stock Exchange. The bond has a coupon of 2.45% payable semi-annually and a 7-year maturity.
* ElvalHalcor signed two bond loans of 7.5-years maturity. The first one amounted to EUR 140 million and the second one amounted to EUR 130 million, both of them were syndicated loans with the four major Greek banks.
* ElvalHalcor reclassified an amount of Euro 25 million to current loans and borrowing, after receiving waiver from the lender, for violation of the “loans towards related parties” provisions, as the waiver has been granted after the reporting date of 31.12.2021.

Cables and Steel Pipes segments
* Hellenic Cables issued a ‘green’ bond loan of EUR 20 million, in compliance with ESG financial principles, with a major Greek bank and an initial maturity of 2-years.
* Fulgor also issued a ‘green’ bond loan of EUR 20 million, in compliance with ESG financial principles, with a major Greek bank, with an initial 2-year term from the date of signing. Both bond loans will support working capital needs for the design, production, installation and operation of submarine and land cable systems in projects related to energy transmission from renewable energy sources and the electrical interconnection of islands.
* Fulgor entered an agreement with a Greek bank for a long-term bond loan of EUR 10 million for 6 years from the date of signing.
* Corinth Pipeworks entered an agreement with a major Greek bank for a long-term bond loan of EUR 10 million for 2 years from the date of signing.
* Corinth Pipeworks entered an agreement with a Greek bank for a long-term bond loan of EUR 7 million for 5 years from the date of signing.
* Corinth Pipeworks entered an agreement with a major Greek bank for a long-term bond loan of EUR 4.6 million for 5 years from the date of signing.
* Hellenic Cables and Corinth Pipeworks repaid the syndicated bond loans issued in 2013 and reprofiled in 2018, EUR 36.6 million. There were also scheduled repayments in December 2021, for 14.0 million. For the mortgages on property, plant and equipment and pledges on inventories that these bond carried, in favor of the bank syndications, the process to lift them has been initiated but not yet completed.

S VIOHALCO | ANNUAL REPORT 2021 167

Steel segment
* Viohalco subsidiary Stomana, finalized the reprofiling of the EUR 67 million long term syndication loan issued in by extending the term from 2023 to 2026.

Real Estate segment
* Noval Property successfully issued a Green Bond Loan of EUR 120 million, listed in the Category of Fixed Income Securities at the Regulated Market of the Athens Stock Exchange. The bond has a coupon of 2.65% payable semi-annually and a 7-year maturity.

No other significant events, related with the financing of subsidiaries occurred during the period. Short term facilities are predominately revolving credit facilities, which finance working capital needs and specific ongoing projects. Viohalco subsidiaries have never in the past experienced any issues in financing their activities, renewing their working capital lines or refinancing longterm loans and borrowings. Management expects that any mandatory repayment of banking facilities will be met with operating cash flows or from currently unutilized and committed credit lines. Under the terms of the loan agreements, certain viohalco subsidiaries must comply with conditions (including financial covenants) and such compliance is tested on an annual basis for the majority of the loans. Management has considered the measures that need to be taken to mitigate the risk relating to these potential breaches and expects that in the event that these covenants are breached, waivers will be granted.However, the improved performance across segments will reverse such event. The average interest rate of the outstanding bank loans as at 31 December 2021 was 3% (3.4% as at 31 December 2020). Property, plant and equipment and inventories of some subsidiaries carry mortgages and liens for a total amount of EUR 1,183 million, as collaterals for long term loans and syndicated loans. In addition, for certain Viohalco companies’ loans, there are change of control clauses that provide lenders early redemption rights.

B. Reconciliation of movements of liabilities to cash flows from financing activities

Amounts in EUR thousands	Loans and Borrowings	Leases	Total
Balance at 1 January 2021	1,747,933	52,211	1,800,144
Changes from financing cash flows
Proceeds from loans and borrowings	896,672	0	896,672
Repayment of borrowings & lease liabilities	-514,171	-11,562	-525,733
Total changes from financing cash flows	382,501	-11,562	370,940
Other changes
New leases	0	5,146	5,146
Interest expense	70,576	2,076	72,651
Interest paid	-62,521	-2,061	-64,582
Capitalised borrowing costs	862	0	862
Terminations/Modifications	674	-483	191
Effect of changes in foreign exchange rate	2,214	7	2,222
Total other changes	11,805	4,685	16,489
Balance at 31 December 2021	2,142,238	45,334	2,187,573

Amounts in EUR thousands	Loans and Borrowings	Leases	Total
Balance at 1 January 2020	1,773,978	53,420	1,827,398
Changes from financing cash flows
Proceeds from loans and borrowings	258,187	0	258,187
Repayment of borrowings & lease liabilities	-286,282	-10,688	-296,970
Total changes from financing cash flows	-28,094	-10,688	-38,783
Other changes
New leases	0	12,657	12,657
Interest expense	68,201	2,374	70,575
Interest paid	-67,123	-2,252	-69,375
Capitalised borrowing costs	4,163	0	4,163
Terminations/Modifications	0	-2,408	-2,408
Loss of Control/Disposal of subsidiary	-1,482	-797	-2,279
Effect of changes in foreign exchange rate	-1,710	-94	-1,804
Total other changes	2,049	9,479	11,529
Balance at 31 December 2020	1,747,933	52,211	1,800,144

• Interest paid reported in Cash Flow Statement, includes bank charges and other finance costs.

VIOHALCO | ANNUAL REPORT 2021 168

1. Trade and other payables

Amounts in EUR thousands	Note	2021	2020
Suppliers		670,552	492,709
Notes payable		271,177	148,389
Social security funds	11	12,465	11,033
Amounts due to related parties	38	4,806	6,485
Sundry creditors		17,828	20,716
Accrued expenses		105,895	60,011
Taxes-duties		28,697	35,955
Total		1,111,420	775,297
Non-current balance of trade and other payables		17,615	12,299
Current balance of trade and other payables		1,093,804	762,998
Balance as at 31 December		1,111,420	775,297

The increase in trade and other payables is mainly attributed to increase in metal prices and the increase in “Notes payable” which concerns structured payable arrangements related to purchases of primary raw materials, such as copper, steel etc. whose payment periods can be longer than usual for such supplies.

1. Grants

Amounts in EUR thousands	Note	2021	2020
Balance as at 1 January		35,817	35,409
New grants received during the year		1,529	495
New grants for which receipt is pending		0	3,073
Transfer of grants to results		-51	0
Transfer of grants to receivables/payables		-427	0
Amortisation of grants	8	-2,886	-3,158
Foreign exchange differences	3	-1
Balance as at 31 December		33,985	35,817

Government grants have been received for investments in property, plant and equipment. During 2021, Viohalco subsidiary, ElvalHalcor, recorded an amount of EUR 1,227 thousands related to grants for the purchase of certain items of property plant and equipment. All conditions attached to the grants received by Viohalco’s companies were met as at 31 December 2021.

1. Provisions

Non-current

Amounts in EUR thousands	Note	Pending court rulings	Other provisions	Total
Balance as at 1 January 2021		25	1,814	1,839
Additional provisions of the fiscal year		0	151	151
Reclassifications		0	-24	-24
Provisions reversed	8	0	-140	-140
Balance as at 31 December 2021		25	1,800	1,825

Amounts in EUR thousands	Note	Pending court rulings	Other provisions	Total
Balance as at 1 January 2020		25	2,752	2,777
Foreign exchange differences		0	-46	-46
Additional provisions of the fiscal year		0	187	187
Transfer to short term provisions		0	-18	-18
Provisions reversed	8	0	-1,062	-1,062
Balance as at 31 December 2020		25	1,814	1,839

Current

Amounts in EUR thousands	Note	Pending court rulings	Other provisions	Total
Balance as at 1 January 2021		348	304	652
Foreign exchange differences	573	0	573
Additional provisions of the fiscal year	12,995	0	12,995
Reclassifications	0	-111	-111
Provisions reversed	8	0	-1	-1
Provisions used	-58	-30	-88
Balance as at 31 December 2021		13,858	162	14,020

Amounts in EUR thousands	Note	Pending court rulings	Other provisions	Total
Balance as at 1 January 2020		153	483	636
Foreign exchange differences		0	-5	-5
Additional provisions of the fiscal year		321	99	420
Transfer from long term provisions		0	18	18
Provisions reversed	8	0	-130	-130
Provisions used	-126	-160	-286
Balance as at 31 December 2020		348	304	652

In 2021, additional provision for antidumping duties have been recorded (note 8). During 2020, provision relating to environmental issue for underground pollution in United Kingdom was reversed, as no obligation was further exist.

1. Financial instruments

A. Accounting classifications and fair values

The following table shows the carrying amounts and fair values of financial assets and financial liabilities, including the levels in the fair value hierarchy.

31 December 2021	Amounts in EUR thousands	Carrying amount	First Level	Second Level	Third Level	Total
Other investments		8,457	4,543	0	3,915	8,457
Derivative financial assets		17,221	14,343	1,934	944	17,221
		25,679	18,886	1,934	4,859	25,679
Derivative financial liabilities		-11,149	-8,316	-2,833	0	-11,149
		14,529	10,570	-899	4,859	14,529

31 December 2020	Amounts in EUR thousands	Carrying amount	First Level	Second Level	Third Level	Total
Other investments		8,324	4,478	0	3,846	8,324
Derivative financial assets		8,161	5,188	1,889	1,084	8,161
		16,485	9,666	1,889	4,930	16,485
Derivative financial liabilities		-6,547	-4,824	-1,443	-280	-6,547
		9,937	4,841	446	4,650	9,937

The various levels are as follows:
- Level 1: Quoted prices (unadjusted) in an active market for identical assets and liabilities;
- Level 2: Inputs that are observable either directly or indirectly;
- Level 3: Unobservable inputs for assets and liabilities.

The fair value of the following financial assets and liabilities measured at amortised cost approximate their carrying amount:
- Trade and other receivables;
- Cash and cash equivalents;
- Trade and other payables;
- Loans and borrowings;
- Lease liabilities.

Specifically, the carrying amount of loans and borrowings is considered as a good approximation of their fair value as 85% of consolidated Loans and borrowings concern floating-rate debt, which are a very good approximation of current market rates.

The following table shows reconciliation between opening and closing balances for Level 3 financial assets:

Amounts in EUR thousands
Balance as at 1 January 2021			3,846
Additions			77
Disposals			-8
Balance as at 31 December 2021			3,915
Balance as at 1 January 2020			830
Additions			3,069
Disposals			-24
Reclassifications (note 14)			-29
Balance as at 31 December 2020			3,846

B. Measurement of fair values

(a) Valuation techniques and significant unobservable inputs

The fair values of financial assets that are traded in active markets (stock markets e.g. derivatives, shares, bonds, mutual funds) are set according to the published prices that are valid on the reporting date. The fair value of financial assets is determined by their offer price, while the fair value of financial liabilities is determined by their bid price. The fair values of financial assets that are not traded in active markets are set through the use of valuation techniques and standards that are based on market data on the reporting date. The fair values of financial liabilities, for the purpose of being recorded in financial statements, are estimated based on the present value of the future cash flows that arise from specific contracts using the current interest rate that is available for Viohalco and its companies for the use of similar financial-credit means. Inputs that do not meet the respective criteria and cannot be classified in Level 1 but are observable, either directly or indirectly, fall under Level 2. Over-the-counter derivative financial instruments based on prices obtained from brokers are classified in this level. The financial assets, such as unlisted shares that are not traded in an active market whose measurement is based on the Viohalco’s companies’ forecasts for the issuer’s future profitability are classified under Level 3.

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The following table shows the valuation techniques used in measuring fair values, as well as the significant unobservable inputs used:

	Valuation technique	Significant unobservable inputs	Inter-relationship between key unobservable inputs and fair value measurement
Derivatives	Market value: Price as traded in active market	Not applicable	Not applicable
	Market comparison technique: The fair values are based on broker quotes.

Viohalco and its companies are exposed to credit, liquidity and market risk due to the use of its financial instruments. This Note sets forth information on their exposure to each one of the above risks, their objectives, the policies and procedures applied to risk measurement and management and Viohalco’s capital management (note 25). More quantitative particulars on these disclosures are included in the entire range of the Consolidated Financial Statements. The risk management policies are applied to identify and analyze the risks facing Viohalco and its companies, set risk-taking limits and apply relevant control systems. The risk management policies and relevant systems are examined from time to time so as to take into account any changes in the market and the companies’ activities. The implementation of risk management policies and procedures is supervised by the Internal Audit department, which performs ordinary and extraordinary audits relating to the implementation of procedures, whereas the results of such audits are notified to the Board of Directors.

C.1. Credit risk

Credit risk is the risk of the financial loss to Viohalco and its companies, if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the companies’ receivables from customers, contract assets and bank deposits. The carrying amount of financial assets represents the maximum credit exposure.

Amounts in EUR thousands	2021	2020
Trade & other receivables	630,850	457,809
Contract assets	101,371	68,517
Less: Other down payments	-16,478	-7,567
Tax assets	-62,298	-59,663
Other non-financial assets	-28,012	-26,630
	625,433	432,466
Other investments	8,457	8,324
Cash and cash equivalents	503,267	219,161
Derivatives	17,221	8,161
	528,945	235,645
Total	1,154,378	668,111

(a) Trade and other receivables

Viohalco companies’ exposure to credit risk is influenced mainly by the individual characteristics of each customer. However, the companies’ management also considers the factors that may influence the credit risk of its customer base, including the default risk of the industry and country in which customers operate. No client exceeds 10% of consolidated sales and, consequently, commercial risk is spread over a large number of clients. However, due to the fact that the business of certain subsidiaries (i.e. CPW Pipe Industry, Hellenic Cable Industry and Fulgor) is project oriented, there are cases where this threshold is individually exceeded for a rather short period of time.

Viohalco’s companies have established a credit policy on the basis under which each new customer is examined on an individual basis in terms of creditworthiness before the standard payment and delivery terms are proposed to such customer. Viohalco’s companies review includes external ratings, if they are available, and in some cases bank references. Credit limits are set for each customer, which are reviewed in accordance with current circumstances and the terms of sales and collections are readjusted, if necessary. As a rule, the credit limits of customers are set on the basis of the insurance limits received for them from insurance companies and, subsequently, receivables are insured according to such limits. When monitoring the credit risk of customers, the latter are grouped according to their credit characteristics, the maturity characteristics of their receivables and any past problems of receivability they have shown. Trade and other receivables mainly include wholesale customers of Viohalco’s companies. Any customers characterized as being “high risk” are included in a special list of customers and subsequent sales must be paid in advance. Depending on the background of the customer and its status, Viohalco’s companies demand real or other security (e.g. letters of guarantee) in order to secure its receivables, if possible. Viohalco’s companies record an impairment loss that represents its expected credit losses in respect of trade and other receivables.

At 31 December, the maximum exposure to credit risk for trade and other receivables and contract assets by geographic region was as follows:

Amounts in EUR thousands	2021	2020
Greece	184,545	179,175
Other EU member states	261,941	156,445
Other European countries	77,343	40,368
Asia	57,020	22,579
America	36,440	26,829
Africa	7,665	6,868
Oceania	479	202
Total	625,433	432,466

The ageing of trade and other receivables and contract assets that were not impaired was as follows:

Amounts in EUR thousands	2021	2020
Neither past due nor impaired	556,236	374,390
Overdue - Up to 6 months	59,022	40,780
- Over 6 months	10,175	17,296
Total	625,433	432,466

Based on management assessment, the amounts that are past due up to 6 months and over 6 months are still collectible in full, based on historical payment behaviour and extensive analysis of customer credit risk, including underlying customers’ credit ratings whenever they are available. Viohalco companies insure significant portion of their receivables in order to be secured in case of default. As at 31 December 2021, 77% of the balances owed by 3rd parties were insured.

The movement in impairment of trade and other receivables and contract assets is as follows:

Amounts in EUR thousands	Trade & other receivables (2021)	Contract assets (2021)	Total (2021)	Trade & other receivables (2020)	Contract assets (2020)	Total (2020)
Balance as at 1 January	71,693	143	71,836	73,215	115	73,330
Impairment loss recognized	2,999	175	3,173	2,027	48	2,075
Amounts written off	-8,454	0	-8,454	-1,078	0	-1,078
Impairment loss reversed	-476	0	-476	-558	-21	-578
Foreign exchange differences	1,776	0	1,776	-1,914	0	-1,913
Reclassification	-225	0	-225	0	0	0
Balance as at 31 December	67,313	318	67,630	71,693	143	71,836

The allowance for expected credit losses for trade receivables and contract assets are calculated at individual level when there is an indication of impairment. For receivables and contract assets without any indication of impairment the expected credit losses are based on the historical credit loss experience combined with forward-looking information in macroeconomic factors affecting the credit risk, such as country risk and customers’ industry related risks. Expected loss rates are updated at every reporting date.

In 2021, the impairment loss recognized concerns mainly clients in steel, aluminium and copper segment while amounts that have been impaired mainly in copper and steel segments where written off. On the contrary, a reversal of impairment loss was recorded as a result of the improvement of the expected loss rates of major clients.

The following collateral exists for securing non-insured receivables from customers and contract assets:

Amounts in EUR thousands	2021	2020
Cash collateral	1,076	3,448
Letter of credit	10,674	11,740
Collateral on property	2,037	2,037
Payables which can be offset by receivables	11,441	7,248
Other	3,253	2,029
Total	28,480	26,502

(b) Cash and cash equivalents

Viohalco and its subsidiaries held cash and cash equivalents of EUR 503 million at 31 December 2021 (2020: EUR 219 million). The cash and cash equivalents are held with bank and financial institution counterparties, which are rated from A3 to Caa1 based on ratings of Moody’s. Impairment on cash and cash equivalents has been measured on a 12-month expected loss basis and reflects the short maturities of the exposures. Viohalco considers that its cash and cash equivalents have low credit risk based on the credit assessment performed.

C.2. Liquidity risk

Liquidity risk is the risk that Viohalco companies will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The approach to manage liquidity is to ensure, as much as possible, that they will have sufficient liquidity to meet their liabilities when they are due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to their reputation. In order to avoid liquidity risks, Viohalco companies aim to maintain the level of their cash and cash equivalents at an amount in excess of expected cash outflows on financial liabilities (other than trade payables) over the next quarter days. They also monitor the level of expected cash inflows on trade and other receivables together with expected cash outflows on trade and other payables. This excludes the potential impact of extreme circumstances that cannot reasonably be predicted. Viohalco’s subsidiary Steelmet SA, provides support services to other subsidiaries, when agreeing financing terms with credit institutions in Greece and other countries.# Exposure to liquidity risk

Financial liabilities and derivatives based on contractual maturity are broken down as follows:

2021

Amounts in EUR thousands	Carrying Amount	< 1year	1-2 years	2-5 years	> 5 years	Total Liabilities
Bank loans	911,208	731,748	50,791	123,419	21,725	927,683
Bond issues	1,231,031	150,965	226,495	490,837	522,835	1,391,132
Lease liabilities	45,335	11,728	10,245	9,083	15,589	46,644
Derivatives	11,149	7,563	3,205	0	382	11,149
Contract liabilities	61,371	61,448	0	0	0	61,448
Trade and other payables	1,111,420	1,092,676	6,497	3,184	9,063	1,111,420
Total	3,371,513	2,056,128	297,232	626,524	569,593	3,549,477

2020

Amounts in EUR thousands	Carrying Amount	< 1year	1-2 years	2-5 years	> 5 years	Total Liabilities
Bank loans	889,604	632,215	63,598	156,812	51,732	904,356
Bond issues	858,391	126,178	306,657	428,278	81,781	942,895
Lease liabilities	52,211	11,832	12,160	28,750	2,090	54,833
Derivatives	6,547	6,278	270	0	0	6,547
Contract liabilities	54,021	54,103	0	0	0	54,103
Trade and other payables	775,297	780,469	6,868	3,330	1,133	791,800
Total	2,636,072	1,611,075	389,552	617,171	136,736	2,754,533

Viohalco companies have syndicated loans that contain certain financial covenants. The ratios most commonly used are ’Total liabilities / Total equity‘, ’Net debt / Total sales‘ and ’Current assets / Current liabilities‘. A future breach of covenants may require the companies to repay the loans earlier than indicated in the above table. Under the agreement, the covenants are monitored on regular basis and regularly reported to companies’ management to ensure compliance with the agreements.

C.3. Market risk

Market risk is the risk that changes in the market prices – such as commodity prices, foreign exchange rates and interest rates - will affect Viohalco and its companies income or the value of their financial instruments. Viohalco’s companies use derivatives to manage market risk. All such transactions are carried out through Steelmet S.A. Generally, the companies seek to apply hedge accounting to manage volatility in profit or loss.

(a) Currency risk:

Viohalco and its companies are exposed to currency risk in relation to the sales and purchases carried out and the loans issued in a currency other than the functional currency of Viohalco and its companies, which is mainly EUR. The most important currencies in which these transactions are held are mainly EUR, USD and GBP. Over time, Viohalco’s companies hedge the greatest part of their estimated exposure to foreign currencies in relation to the anticipated sales and purchases, as well as to the receivables and liabilities in foreign currency. Viohalco’s companies enter mainly into forward contracts with external counterparties so as to deal with the risk of the exchange rates varying, which mainly expire within less than a year from the reporting date. When deemed necessary, these contracts are renewed upon expiry. As the case may be, the foreign exchange risk may also be covered by taking out loans in the respective currencies. Loan interest is denominated in the same currency with that of cash flows, which arises from the Viohalco’s companies’ operating activities. The investments of Viohalco and its companies in their subsidiaries are not hedged, because these exchange positions are considered to be long-term and have been made mainly in Euro. The summary quantitative data about Viohalco and its companies’ exposure to currency risk as reported is as follows.

2021

Amounts in EUR thousands	USD	GBP	BGN	RSD	RON	Other	Total at risk	EUR	Total
Trade and other receivables	70,522	24,868	33,598	5,661	32,395	10,245	177,288	453,562	630,850
Contract assets	0	0	0	0	0	0	0	101,371	101,371
Loans and borrowings	-14,441	-36,467	-1,718	-31	-6,930	-7,315	-66,901	-2,120,672	-2,187,573
Trade and other payables	-110,971	-23,080	-55,155	-556	-17,045	-947	-207,754	-903,666	-1,111,420
Contract liabilities	-719	0	-1,511	-49	-1,001	-4,848	-8,129	-53,243	-61,371
Cash & cash equivalents	28,422	5,488	5,131	462	3,243	308	43,054	460,213	503,267
Net Exposure	-27,188	-29,191	-19,655	5,486	10,662	-2,557	-62,442	-2,062,434	-2,124,876
Derivatives for risk hedging (Nominal Value)	-61,934	-26,026	0	0	0	0	-87,960	0	-87,960
Total Exposure	-89,122	-55,217	-19,655	5,486	10,662	-2,557	-150,402	-2,062,434	-2,212,836

2020

Amounts in EUR thousands	USD	GBP	BGN	RSD	RON	Other	Total at risk	EUR	Total
Trade and other receivables	47,491	10,834	19,184	2,051	19,768	8,353	107,681	350,128	457,809
Contract assets	0	0	0	0	0	0	0	68,517	68,517
Loans and borrowings	-5,033	-8,724	-5,477	0	-6,131	-9,671	-35,036	-1,765,171	-1,800,207
Trade and other payables	-65,286	-19,526	-44,230	-639	-12,706	-1,401	-143,789	-631,508	-775,297
Contract liabilities	-3,759	0	-415	-943	-1,492	-37	-6,646	-47,374	-54,021
Cash & cash equivalents	25,999	9,969	4,109	1,082	2,974	1,001	45,134	174,027	219,161
Net Exposure	-588	-7,446	-26,829	1,551	2,412	-1,756	-32,656	-1,851,382	-1,884,039
Derivatives for risk hedging (Nominal Value)	-21,627	-21,439	0	0	0	0	-43,066	21,300	-21,766
Total Exposure	-22,216	-28,885	-26,829	1,551	2,412	-1,756	-75,722	-1,830,082	-1,905,804

“Derivatives for risk hedging” includes also derivatives that relate to highly probable transactions, which have not been yet recognized as assets or liabilities in the consolidated statement of financial position. Euro denominated amounts are included for totals’ reconciliation purposes.

The following exchange rates have been applied during the year.

	Average exchange rate	Year end spot rate
	2021	2020
USD	1.18	1.14
GBP	0.86	0.89
BGN	1.96	1.96
RSD	117.57	117.58
RON	4.92	4.84

Viohalco is primarily exposed to changes of Euro against US dollar, pound sterling, Serbian Dinar and RON. A reasonably possible strengthening (weakening) of Euro against these currencies as at 31 December would have affected the measurement of financial instruments denominated in a foreign currency and affected equity and profit or loss by the amounts shown below. This analysis assumes that all other variables, in particular interest rates, remain constant and ignores any impact of forecast sales and purchases. The Bulgarian currency LEV is not analysed below due to its fixed currency rate at 1.96 BGN/EUR.

Amounts in EUR thousands	Strengthening EUR	Weakening EUR	Strengthening EUR	Weakening EUR
	Profit or loss	Profit or loss	Equity, net of tax	Equity, net of tax
2021
USD (10% movement)	8,920	-8,920	13,751	-13,751
GBP (10% movement)	6,337	-6,337	8,367	-8,367
RSD (10% movement)	-428	428	-428	428
RON (10% movement)	-832	832	-832	832
2020
USD (10% movement)	1,070	-1,070	1,688	-1,688
GBP (10% movement)	2,195	-2,195	2,195	-2,195
RSD (10% movement)	-118	118	-118	118
RON (10% movement)	-183	183	-183	183

(b) Interest rate risk:

Viohalco’s subsidiaries during the prolonged low interests period have adopted a flexible policy of ensuring that between 0% and 20% of its interest rate risk exposure is at a fixed rate. This is achieved mostly by borrowing at a floating rate and in certain circumstances by entering into fixed–rate instruments. The interest rate profile of Viohalco companies’ interest-bearing financial instruments, as reported is as follows.

Nominal amount Amounts in EUR thousands	2021	2020
Fixed-rate instruments
Financial assets	0	3,975
Financial liabilities	-326,704	-103,359
Variable-rate instruments
Financial liabilities	-1,860,868	-1,614,903

Fixed-rate instruments

Viohalco does not account for any fixed-rate financial assets or financial liabilities at fair value through profit or loss. Viohalco currently uses derivatives (interest rate swaps) as hedging instruments under a cash flow hedge accounting model.

Sensitivity analysis for variable-rate instruments

A reasonably possible change of 0.25% in interest rates of variable-rate instruments at the reporting date would have increased/ decreased (-) profit or loss by the amount shown below. This analysis assumes that all other variables, in particular foreign currency exchange rate, remain constant.

Variable rate Amounts in EUR thousands	0.25% increase	0.25% decrease
2021
Financial liabilities	-449	452
Cash flow sensitivity (net)	-449	452
2020
Financial liabilities	-3,928	3,928
Cash flow sensitivity (net)	-3,928	3,928

(c) Cash flow hedges

The following table indicates the periods in which the cash flows associated with cash flow hedges are expected to occur:

Carrying amount Amounts in EUR thousands at 31 December 2021

	1-6 months	6-12 months	More than 1 year	31 December 2021
Interest rate Swaps
Liabilities	382	0	0	382
Forwards
Assets	760	732	28	0
Liabilities	2,071	2,035	36	0
Future contracts
Assets	7,670	7,564	107	0
Liabilities	5,062	5,077	-14	0
Commodity Swaps
Assets	6,663	3,087	3,576	0
Liabilities	3,205	0	0	3,205
Total	25,813	18,876	3,732	3,205

Carrying amount Amounts in EUR thousands at 31 December 2020

	1-6 months	6-12 months	More than 1 year	31 December 2020
Interest rate Swaps
Liabilities	1,026	0	0	1,026
Forwards
Assets	1,619	1,576	43	0
Liabilities	516	466	51	0
Future contracts
Assets	5,188	3,984	1,139	64
Liabilities	4,583	4,591	-8	0
Total	12,932	10,617	1,225	1,090

The table below provides information about the items designated as cash flow hedging instruments during the year and also as at 31 December 2021 and the reconciliation of hedging reserve. Based on their nature, hedging instruments are included in Derivatives assets and Derivatives liabilities in consolidated statement of financial position.# C.3. Financial Instruments

(d) Commodity price risk

The commodity markets experience continuous price fluctuations. Viohalco companies minimize their exposure to commodity price volatility by using hedging instruments, when possible. Viohalco companies are exposed to the fluctuation of aluminium, copper, zinc, lead and nickel. In order to minimize the effect of the metal price fluctuations on their results, companies use back to back matching of purchases and sales or derivative instruments (future contracts).

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As at 31 December 2021, the derivative net balance of future contracts per commodity as reported in the statement of financial position is:

Amounts in EUR thousands	2021	2020
Aluminium	975	2,828
Copper	1,658	-2,162
Lead	-25	-58
Nickel	0	-4
Total	2,608	605

In addition, during 2021, Viohalco subsidiaries started using Commodity Swaps referenced on the Title Transfer Facility (TTF) prices to hedge the risk of fluctuations in natural gas prices from market conditions. As at 31 December 2021, the derivative net balance these contracts as reported in the statement of financial position is EUR 4.6 million. These hedges are designated in a cash flow hedge accounting relationship.

C.4. Business and Operational Risk Management

There were no changes in Viohalco companies’ business and operational risk management objectives and policies during 2021. Viohalco companies follows closely and continuously both international and domestic developments and timely adapt their business strategy and risk management policies in order to minimize the operational impact of macroeconomic conditions.

31. Impact of Covid-19 pandemic

The Covid-19 pandemic has had a limited impact on the financial performance of Viohalco companies during 2021. The health and safety of Viohalco companies’ employees is of the highest priority for the Executive Management, which continues to closely monitor the situation, observing national and local authority guidelines and ensuring an undisrupted supply chain. Since the beginning of the Covid-19 outbreak, Viohalco Management has put in place a multi-faceted action plan to mitigate negative effects and focusing on the following pillars:

• Workforce protection, to avoid production interruptions;
• Operational stability and customer engagement;
• Continuity of the supply chain;
• Sufficient liquidity;
• Commercial resilience (both sales & orders).

The measures introduced were successfully implemented at all sites, and until now all the production plants are in undisrupted operation. Production continuity was maintained, while health and safety measures were enforced. Raw material supply was safeguarded and companies faced no shortage whatsoever in all critical inputs. The net incremental costs - including any reliefs provided by local legislation because of measures taken due to the pandemic - incurred due to the coronavirus outbreak amounted to EUR 1,449 thousand (2020: EUR 4,837 thousand). Such cost includes temporary premium payments to compensate employees for performing their normal duties at increased personal risk, charges for cleaning and disinfecting facilities more thoroughly and more frequently, medical equipment, nursery staff and other expenses directly associated with the coronavirus Covid-19 pandemic.

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32. Subsidiaries

Viohalco’s subsidiaries and the percentages of financial interest held by the parent company at the end of the reporting period are as follows:

Subsidiary companies	Country	Financial interest 2021	Financial interest 2020
AEIFOROS S.A.	GREECE	98.11%	98.94%
AEIFOROS BULGARIA S.A.	BULGARIA	98.11%	98.94%
ALURAME SPA	ITALY	91.59%	93.45%
ANOXAL S.A.	GREECE	84.78%	91.44%
AΝΑΜΕΤ DOO	SERBIA	97.54%	98.62%
AΝΑΜΕΤ S.A.	GREECE	97.54%	98.62%
AΝΤΙΜΕΤ S.A.	GREECE	100.00%	100.00%
AΤΤΙΚI S.A.	GREECE	75.00%	75.00%
BASE METALS S.A.	TURKEY	69.15%	70.55%
BRIDGNORTH LTD	U.K.	75.00%	75.00%
CABLEL WIRES S.A.	GREECE	84.78%	91.44%
CENERGY HOLDINGS S.A.	BELGIUM	79.78%	79.78%
HELLENIC CABLES AMERICA CO.	USA	79.78%	-
CLUJ INTERNATIONAL TRADE SRL	ROMANIA	91.59%	100.00%
CORINTH PIPEWORKS S.A.	GREECE	79.78%	79.78%
CPW AMERICA Co	USA	79.78%	79.78%
DE LAIRE LTD	CYPRUS	79.78%	79.78%
DIO PERNIK EOOD	BULGARIA	98.11%	98.94%
DIA.VI.PE.THI.V S.A.	GREECE	91.54%	92.92%
DOJRAN STEEL LLCOP	NORTH MACEDONIA	100.00%	100.00%
ELVAL COLOUR S.A.	GREECE	84.78%	91.44%
ELVAL COLOUR IBERICA S.A.	SPAIN	84.78%	91.44%
ELVALHALCOR S.A.	GREECE	84.78%	91.44%
ELVIOK S.A (former ELVALHALCOR CONSULTING SA)	GREECE	84.78%	91.44%
ELΚΕΜΕ S.A.	GREECE	84.40%	90.57%
EPIRUS METALWORKS S.A.	GREECE	84.78%	91.42%
ERGOSTEEL S.A.	GREECE	89.12%	91.08%
ERLIKON S.A.	GREECE	100.00%	100.00%
ETEM ALBANIA S.A.	ALBANIA	88.79%	100.00%
ETEM BULGARIA S.A.	BULGARIA	100.00%	100.00%
ETEM BG S.A.	BULGARIA	88.79%	100.00%
ETEM GESTAMP EXTRUSIONS S.A.	BULGARIA	51.00%	51.00%
EΤΕΜ COMMERCIAL S.A.	GREECE	87.82%	100.00%
ETEM SCG	SERBIA	88.79%	100.00%
EΤΕΜ SYSTEMS LLC	UKRAINE	88.79%	100.00%
EΤΕΜ SYSTEMS SRL	ROMANIA	88.79%	100.00%
EΤIL S.A.	GREECE	100.00%	100.00%
FITCO S.A.	GREECE	-	91.44%
FLOCOS S.A.	GREECE	100.00%	100.00%
FULGOR S.A.	GREECE	79.78%	79.78%
GENECOS S.A.	FRANCE	91.59%	93.45%
HELLENIC CABLES S.A.	GREECE	79.78%	79.78%
HELLENIC CABLES TRADING CO.	USA	79.78%	79.78%
HUMBEL LTD	CYPRUS	79.78%	79.78%
ICME ECAB S.A.	ROMANIA	79.76%	78.66%
INOS BALCAN DOO	SERBIA	97.54%	98.62%
IWM S.A.	BULGARIA	-	98.94%
INTERNATIONAL TRADE S.A.	BELGIUM	91.59%	93.45%
JOSTDEX LIMITED	CYPRUS	100.00%	100.00%
LESCO ROMANIA S.A.	ROMANIA	51.86%	51.86%
LESCO EOOD	BULGARIA	79.78%	79.78%
METAL AGENCIES LTD	U.K.	91.59%	93.45%
METALCO S.A.	BULGARIA	100.00%	100.00%
METALIGN S.A.	BULGARIA	100.00%	100.00%
VIOHALCO	ANNUAL REPORT 2021 180
Subsidiary companies	Country	Financial interest 2021	Financial interest 2020
METALLOURGIA ATTIKIS S.A.	GREECE	50.00%	50.00%
METALLOURGIA ATTIKIS PROPERTIES S.A.	GREECE	50.00%	-
NOVAL PROPERTY REIC	GREECE	87.29%	87.34%
NOVOMETAL DOO	NORTH MACEDONIA	97.54%	98.62%
PORT SVISHTOV WEST S.A.	BULGARIA	73.09%	73.09%
PRAKSIS S.A.	GREECE	61.00%	61.00%
PRAKSIS BG S.A.	BULGARIA	61.00%	61.00%
REYNOLDS CUIVRE S.A.	FRANCE	91.59%	93.45%
ROULOC S.A.	GREECE	84.78%	91.44%
SIDEBALK STEEL DOO	SERBIA	100.00%	100.00%
SIDENOR INDUSTRIAL S.A.	GREECE	100.00%	100.00%
SIDERAL SHRK	ALBANIA	99.92%	99.95%
SIDEROM STEEL SRL	ROMANIA	100.00%	100.00%
SMARTREO PYT LTD	AUSTRALIA	-	99.00%
SOFIA MED AD	BULGARIA	86.37%	92.33%
SOVEL S.A.	GREECE	92.95%	92.95%
STEELMET CYPRUS LTD	CYPRUS	89.12%	91.08%
STEELMET PROPERTIES S.A.	GREECE	89.12%	91.08%
STEELMET ROMANIA S.A.	ROMANIA	91.59%	93.45%
STEELMET S.A.	GREECE	89.12%	91.08%
STOMANA INDUSTRY S.A.	BULGARIA	100.00%	100.00%
STOMANA ENGINEERING SA (former SIGMA IS SA)	BULGARIA	100.00%	100.00%
SYMETAL S.A.	GREECE	84.78%	91.44%
TECHOR S.A.	GREECE	84.78%	91.44%
TECHOR ROMANIA S.A.	ROMANIA	84.78%	91.44%
TEPROMKC AG	GERMANY	91.59%	93.45%
TERRA MIDDLE EAST AG	GERMANY	91.59%	93.45%
TΕΚΑ SYSTEMS S.A.	GREECE	85.72%	50.01%
VEPAL S.A.	GREECE	84.78%	91.44%
VIENER S.A.	GREECE	93.70%	96.46%
VIEXAL S.A.	GREECE	95.94%	97.72%
VIOMAL S.A.	GREECE	63.58%	68.58%
VITRUVIT S.A.	GREECE	99.75%	99.86%
WARSAW TUBULARS TRADING SP.ZO	POLAND	79.78%	79.78%

The ultimate controlling entity is Viohalco S.A. for all the above entities. Viohalco does exercise control, by holding the majority of the voting rights, directly and/or indirectly and these entities are reported as subsidiary companies. The percentages reported on the above table represent the financial interest held directly and indirectly by Viohalco. For example, if Viohalco holds 70% of company A and company A holds 70% of company B, then in the table above it will be presented that Viohalco holds 49% of financial interest in company B.

Transactions that took place in 2021

Acquisition of NCI

• During 2021, Viohalco acquired further 26,78% of its subsidiary Teka Systems share capital, in consideration of EUR 7.5 million and after the cancellation of Teka System own shares, the percentage of participation was formed at 85.72% (31 December 2021: 50.01%).

Increase of NCI

• In April 2021, Viohalco has completed the placement of 25 million shares of its subsidiary ElvalHalcor, representing the 6.66% of the company’s share capital, in consideration of EUR 50 million. Following the aforementioned placement, Viohalco’s participation in ElvalHalcor paid up share capital amounts to 84.78%, decreased from 91.44%.

Mergers & Absorptions

• In July 2021, Viohalco subsidiary Fitco was absorbed by ElvalHalcor.

New subsidiaries establishment

• In December 2021, a new Greek based subsidiary, Mettalourgia Attikis Properties, was established of after the partial spin off of Real Estate activity of Metallourgia Attikis SA, operating in the Real Estate segment.
• In December 2021, the subsidiary Hellenic Cables America Co.

VIOHALCO | ANNUAL REPORT 2021 181## 33. Joint operations

Viohalco’s subsidiary Hellenic Cables has a 62.48% interest in a joint arrangement called VO Cablel VOF, which was set up as a partnership together with Van Oord. The scope of this joint operation scheme is to supply and install sea and land cables for the Hollandse Kust (South) Alpha project and Hollandse Kust (South) Beta project. The principal place of business of the joint operation is in the Netherlands. Hellenic Cables has a 50.77% interest in a joint arrangement called DEME Oshore NL - Hellenic Cables V.O.F., which was set up as a partnership together with Tideway. The scope of this joint operation scheme is to execute a turnkey contract for the supply and installation of submarine cables for the connection of the Seamade oshore wind project to the Belgian grid. The principal place of business of the joint operation is in Belgium. Viohalco’s subsidiary Fulgor has a 10% interest in a joint arrangement called Fulgor – JDN Consortium, which was set up as a partnership together with Jan De Nul. The scope of this joint operation scheme is to execute a turnkey contract for the installation of submarine cables for the interconnection Crete-Peloponnese in Greece. The principal place of business of this joint operation is in Greece. Fulgor has a 71.09% interest in a joint arrangement called Fulgor – Asso.subsea Ltd Consortium, which was set up as a partnership together with Asso.subsea Ltd. The scope of this joint operation scheme is to execute a turnkey contract for the design, manufacturing, supply and installation of the 150 kV submarine cable system connecting the under construction 330 MW Kareas II Wind Farm to Greece’s mainland grid. The principal place of business of this joint operation is in Greece. The above joint operations were formed during prior years. The agreements in relation to the VO Cablel VOF, Fulgor – JDN Consortium and DEME Oshore NL - Hellenic Cables V.O.F. require unanimous consent from all parties for all relevant activities. The two partners have direct rights to the assets of the partnership and are jointly and severally liable for the liabilities incurred by the partnership. These entities are therefore classied as joint operations and the Group recognises its direct right to the jointly held assets, liabilities, revenues and expenses as described in note 5.

34. Non-controlling interests

The following table summarises the information relating to each of the subsidiaries that have material NCI (at sub-group level in the cases of Cenergy, ElvalHalcor, Sidenor) before any intra-group elimination.

VIOHALCO | ANNUAL REPORT 2021 182

	Cenergy	ElvalHalcor	Sidenor	Bridgnorth	Other eliminations	Total
2021
Intragroup Amounts in EUR thousands
NCI percentage	20.22%	15.22%	0.00%	25.00%
Non-current assets	549,423	975,185	303,121	77,487
Current assets	646,185	1,107,514	399,056	149,518
Non-current liabilities	244,017	748,752	251,366	6,427
Current liabilities	684,392	647,843	400,441	111,108
Net Assets	267,199	686,104	50,371	109,470
Attributable to NCI by the companies	35	16,724	37,467	0
Net attributable to the equity holders & NCI of Viohalco	267,164	669,380	12,904	109,470
Attributable to NCI by parent Company	54,021	101,880	0	27,368
Carrying amount of NCI	54,056	118,604	37,467	27,368	43,535	-40,060
Revenue	1,054,203	2,889,696	726,333	322,697
Profit / Loss (-)	20,915	152,622	56,896	-5,829
Other comprehensive income	514	2,508	-170	6,913
Total comprehensive income	21,429	155,130	56,727	1,084
Attributable to NCI by the companies	1	2,560	12,658	0
Net attributable to the equity holders & NCI of Viohalco	21,428	152,569	44,069	1,084
Attributable to NCI by Viohalco	4,333	23,221	0	271
Total OCI of NCI	4,334	25,781	12,658	271	3,825	-20,189
Cash flows from operating activities	112,514	24,577	33,603	-30,468
Cash flows from investing activities	-43,757	-169,242	-14,629	-8,261
Cash flows from financing activities	-20,494	202,003	1,389	41,392
Net increase/ decrease (-) in cash and cash equivalents	48,263	57,339	20,364	2,663
2020*
Intragroup Amounts in EUR thousands
NCI percentage (at parent company level)	20.22%	8.56%	0.00%	25.00%
Non-current assets	529,772	878,333	304,798	72,117
Current assets	473,103	797,393	281,904	91,458
Non-current liabilities	239,816	529,809	293,227	5,468
Current liabilities	517,289	523,993	299,831	49,721
Net Assets	245,770	621,924	-6,356	108,386
Attributable to NCI by the companies	287	10,493	24,809	0
Net attributable to the equity holders & NCI of Viohalco	245,483	611,430	-31,165	108,386
Attributable to NCI by parent Company	49,637	52,338	0	27,097
Carrying amount of NCI	49,923	62,832	24,809	27,097	46,190	-34,922
Revenue	908,417	2,028,569	469,627	192,064
Profit / Loss (-)	24,376	29,614	-11,994	-196
Other comprehensive income	-5,084	2,863	-207	-5,278
Total comprehensive income	19,292	32,477	-12,201	-5,474
Attributable to NCI by the companies	-8	1,467	-709	0
Net attributable to the equity holders & NCI of Viohalco	19,300	31,009	-11,492	-5,474
Attributable to NCI by Viohalco	3,903	2,654	0	-1,369
Total OCI of NCI	3,895	4,122	-709	-1,369	3,757	-581
Cash flows from operating activities	158,575	83,353	18,378	9,634
Cash flows from investing activities	-72,182	-123,883	-9,974	-6,351
Cash flows from financing activities	-95,137	25,680	1,560	-3,422
Net increase/ decrease (-) in cash and cash equivalents	-8,744	-14,850	9,964	-139

*Restated figures due to the retrospective application of change in the method of attributing benefit to periods of service (IAS 19) (see Note 5.23)

On April 29th 2021, Viohalco has completed the placement of 25 million shares of its subsidiary ElvalHalcor, representing the 6.66% of the company’s share capital, in consideration of EUR 50 million. Following the aforementioned placement, Viohalco’s participation in ElvalHalcor paid up share capital amounts to 84.78%, decreased from 91.44%.

35. Leases

A. Leases as lessee

(a) Amounts recognised in the Statement of Financial Position

The Consolidated Statement of Financial Position shows the following amounts relating to leases:

Right of Use Assets

Amounts in EUR thousands	31 December 2021	31 December 2020
Land	345	367
Buildings	4,091	4,291
Machinery	18,786	23,083
Transportation equipment	10,744	10,665
Other equipment	323	92
Total Right-of-use assets	34,288	38,498

Lease liabilities

Amounts in EUR thousands	31 December 2021	31 December 2020
Current lease liabilities	10,696	10,935
Non-current lease liabilities	34,639	41,276
Total lease liabilities	45,335	52,211

Additions to the right-of-use assets during 2021 were EUR 6,276 thousands (2020: EUR 7,414 thousands).

(b) Amounts recognised in the Statement of profit or loss

The statement of profit or loss includes the following amounts relating to leases:

Amounts in EUR thousands	2021	2020
Depreciation charge of right-of-use assets
Plots	37	38
Buildings	911	843
Machinery	2,926	2,833
Transportation means	4,509	4,676
Other equipment	135	60
Total	8,518	8,450
Interest expense (included in finance cost)	2,076	2,374
Variable rental fees	730	1,131
Low value rental fees	461	362
Short term rental fees	4,111	3,956
Total	7,378	7,823

B. Leases as lessor

Viohalco and its companies in the real estate development sector lease out their investment properties (See note 19).

(a) Future minimum lease collections

At 31 December, the future minimum lease payments under non-cancellable leases were as follows.

Amounts in EUR thousands	2021	2020
Less than one year	16,658	15,001
Between one and two years	14,942	14,224
Between two and three years	14,551	10,897
Between three and four years	14,321	10,003
Between four and five years	12,955	9,400
More than five years	79,110	45,709
Total	152,537	105,234

VIOHALCO | ANNUAL REPORT 2021 184

(b) Amounts recognized in profit or loss

The figures below are related to investment property that has been recognised in the statement of profit or loss. Operating expenses relate mainly to maintenance cost.

Amounts in EUR thousands	2021	2020
Rental income from investment property	11,472	10,041
Direct operating expenses that do not generate rental income	-61	-443

36. Commitments

A. Purchase commitments

The below mentioned commitments relate to contracts that Viohalco’s subsidiaries have entered into, according to their investment plans and are expected to be concluded during the next 3 years.

Amounts in EUR thousands	2021	2020
Property, plant and equipment	20,383	19,308
Investment property	953	8,800
Intangible Assets	58	16

B. Guarantees

Amounts in EUR thousands	2021	2020
Liabilities
Guarantees to secure liabilities to suppliers	35,172	27,675
Guarantees for securing the good performance of contracts with customers	238,306	264,901
Guarantees for securing the good performance of contracts with suppliers	2,141	415

37. Contingent liabilities

A.# VIOHALCO | ANNUAL REPORT 2021

38. Related parties

A. Equity-accounted investees and other related parties

The following transactions have been made with equity-accounted investees and other related parties.

Amounts in EUR thousands	2021	2020
Sale of goods/ services
Associates	96,281	61,380
Joint ventures	34,516	22,946
	130,798	84,326
Sale of fixed assets
Joint ventures	198	9,898
	198	9,898
Purchases of goods / services
Associates	10,639	7,067
Joint ventures	2,335	2,530
	12,974	9,596
Purchase of fixed assets
Associates	13,351	23
Joint ventures	26	0
	13,377	23

Closing balances that arise from sales/purchases of goods, services, fixed assets, etc.:

Amounts in EUR thousands	2021	2020
Receivables from related parties
Associates	37,625	31,118
Joint ventures	10,025	13,407
	47,651	44,525
Contract assets to related parties
Associates	90	40
Joint ventures	42	0
	132	40
Liabilities to related parties
Associates	3,543	5,165
Joint ventures	1,263	1,319
	4,806	6,485
Contract liabilities to related parties
Joint ventures	8	37
	8	37

The outstanding balances from related parties are secured and the settlement of those balances is expected to be performed in cash during the following year, since the balances concern only short-term receivables and payables. Services to and from related parties as well as sales and purchases of goods are carried out in accordance with the price lists applying to non-related parties. During 2021, services of EUR 180 thousand (2020: EUR 180 thousands) acquired from entities that are controlled by members of the key management personnel.

B. Key management personnel compensation

The table below provides an overview of the transactions with Board members and executive management:

Amounts in EUR thousands	2021	2020
Compensation to BoD members and executives	5,430	5,652

The compensation to directors and executive management in the table above are fixed compensation. No variable compensation, post-employment benefits or share based benefits were paid in 2021 and in 2020.

39. Auditor’s fees

The Company’s statutory auditor (PwC Reviseurs d’Entreprises SRL/ Bedrijfsrevisoren BV) and a number of other member firms of the auditor’s network, received fees for the following services:

For year ended 31 December	Amounts in EUR thousands	2021	2020
Statutory Auditor
Audit		366	296
Tax related services		73	0
		439	296
Statutory Auditor Network
Audit		952	1,212
Tax related services		201	16
Other services		232	19
		1,385	1,248
Total		1,824	1,543

40. Subsequent events

• On January 13th, 2022, Viohalco subsidiary, ElvalHalcor, participated in the share capital increase of the joint venture NedZink BV with EUR 1.5 million, maintaining its share to 50%. In addition, on February 28th, 2022, the loan balance of EUR 1.25 million was converted to share capital.

• On February 8th, 2022, the US Department of Commerce (DoC) published its final results in the administrative proceedings conducted by the DoC for the period from April 19, 2019 through April 30, 2020 (“POR”) in connection with an antidumping (“AD”) order on large diameter welded pipe (LDWP) from Greece. As a result, the DoC determined for the POR an antidumping duty rate of 41.04 percent based on total adverse facts available (AFA) for mandatory respondent Corinth Pipeworks, Viohalco steel pipes segment. Despite the lengthy process of the administrative review involving the supply of extremely detailed data sets on Corinth Pipeworks’ commercial practices for the POR under scrutiny, as well as all reasonable estimations made throughout 2021 on the size, if any, of a possible AD duty rate, the DoC concluded on such a high AD duty rate. Corinth Pipeworks intends to file an appeal before the U.S. Court of International Trade against the decision of the DoC while continuing to actively work with the DoC in order to reverse the final determination. Viohalco considers that there will be no material impact on the business of its subsidiary Corinth Pipeworks, as the latter strongly follows a geographically diversified commercial policy and the USA market does not presently constitute its core market. The one-off, additional provision charge on Viohalco annual consolidated economic results from a retrospective implementation of the AD duty rate and reaches ca. EUR 12.8 million (USD 14 million plus interest).

• The Ukraine conflict which began in February 2022 may cause increased market volatility and disruptions to many aspects of global economy during 2022. Although the impact of the crisis on Viohalco subsidiaries cannot be fully predicted, their overall exposure to Ukraine and Russia is limited and the consequences are not expected to have material impact on the business course. Sales exposure to these markets represents an insignificant portion of total turnover and any loss will be fully offset by demand in other markets. In order to mitigate potential disruption in supply chain, Viohalco companies have already initiated shifting the supply of raw materials currently sourced from Russia to alternative markets. In terms of financing, the companies have no exposure to Russian banks though they may see some impact on credit and transportation insurance. Finally, although the conflict in Ukraine has accelerated global energy crisis already experienced since the second half of 2021, Viohalco’s companies had already taken mitigating actions to reduce the business impact. Viohalco and its companies are monitoring the situation closely and will modify their approach when it is required.

• On March 17th, 2022, Viohalco’s Board of directors decided to propose to the Ordinary General Shareholders’ meeting to be held on 31.05.2022, the approval of a gross dividend of EUR 0.10 per share. Taking into account the gross interim dividend of EUR 0.01 per share paid in June 2021, a balance gross amount of EUR 0.09 per share will be payable following approval by the shareholders’ meeting of this proposed resolution.

• On March 17th, 2022, Viohalco’s Board of directors approved the acquisition of 25% non-controlling interest in subsidiary Bridgnorth Aluminium in consideration of GBP 11 million. As a result, Viohalco’s participation in Bridgnorth Aluminium amounts to 100%.

There are no other subsequent events affecting the consolidated financial statements.

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STATUTORY AUDITOR'S REPORT TO THE GENERAL SHAREHOLDERS’ MEETING OF VIOHALCO SA ON THE CONSOLIDATED ACCOUNTS FOR THE YEAR ENDED 31 DECEMBER 2021

We present to you our statutory auditor’s report in the context of our statutory audit of the consolidated accounts of Viohalco SA (the “Company”) and its subsidiaries (jointly “the Group”). This report includes our report on the consolidated accounts, as well as the other legal and regulatory requirements. This forms part of an integrated whole and is indivisible.

We have been appointed as statutory auditor by the general meeting d.d. 28 May 2019, following the proposal formulated by the board of directors and following the recommendation by the audit committee. Our mandate will expire on the date of the general meeting which will deliberate on the annual accounts for the year ended 31 December 2021. We have performed the statutory audit of the Company’s consolidated accounts for 3 consecutive years.

Report on the consolidated accounts

Unqualified opinion

We have performed the statutory audit of the Group’s consolidated accounts, which comprise the consolidated statement of financial position as at 31 December 2021, the consolidated statement of profit or loss, the consolidated statement of other comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the year then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies and other explanatory information, and which is characterised by a consolidated statement of financial position total of EUR 5,238,420 thousands and a profit attributable to owners of the company of EUR 194,994 thousands.In our opinion, the consolidated accounts give a true and fair view of the Group’s net equity and consolidated financial position as at 31 December 2021, and of its consolidated financial performance and its consolidated cash flows for the year then ended, in accordance with International Financial Reporting Standards as adopted by the European Union and with the legal and regulatory requirements applicable in Belgium.

Basis for unqualified opinion

We conducted our audit in accordance with International Standards on Auditing (ISAs) as applicable in Belgium. Furthermore, we have applied the International Standards on Auditing as approved by the IAASB which are applicable to the year-end and which are not yet approved at the national level. Our responsibilities under those standards are further described in the “Statutory auditor’s responsibilities for the audit of the consolidated accounts” section of our report. We have fulfilled our ethical responsibilities in accordance with the ethical requirements that are relevant to our audit of the consolidated accounts in Belgium, including the requirements related to independence. We have obtained from the board of directors and Company officials the explanations and information necessary for performing our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key audit matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated accounts of the current period. These matters were addressed in the context of our audit of the consolidated accounts as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Key audit matter 1: Availability of financing resources and compliance with covenants

Description of the Key Audit Matter

The subsidiaries of the Group have significant non-current and current financial debts. The terms and conditions of the related financing agreements often include financial covenants that are to be complied with at each balance sheet date. Any breach in such financial covenants could result in its lenders exercising the right to claim early repayment of certain non-current and/or current financial debts. For these reasons, we considered the availability of financing resources and failure to comply with covenants as most significant to our audit. Reference is made to Note 5: Significant accounting policies: Financial instruments and Note 26: Loans and Borrowings.

How our Audit addressed the Key Audit Matter

Our testing included, amongst others, an understanding of the financing agreements and the Group’s procedures and controls in place both to ensure its compliance with the financial covenants and to understand the used and unused financing resources. We tested the calculation, performed by Management, of the financial covenants related to the most significant financing agreements and assessed compliance with the terms and conditions stipulated therein. Furthermore, we evaluated both the presentation of the financial debts on the Consolidated Statement of Financial Position and the adequacy of the relevant disclosures in the Notes to the Consolidated Financial Statements. We found the tested financial covenants to be complied with and company’s disclosures of financial debts appropriate.

Key audit matter 2: Impairment of property, plant and equipment

Description of the key audit matter

The carrying value of the Group’s property, plant and equipment amounts to EUR 2,089,107 thousands at 31 December 2021. In accordance with the International Financial Reporting Standards as endorsed by the EU (IFRS), the Company is required to perform an impairment assessment in respect of the property, plant and equipment when triggers for impairment are identified. We consider this matter to be of most significance to our audit because of the magnitude of the amount and because the determination of whether or not an impairment charge is necessary involves significant judgement in estimating the future results of the business. Reference is made to Note 17: Property, plant and equipment.

How our audit addressed the key audit matter

We evaluated the appropriateness of the Group’s accounting policies and assessed compliance with the policies in accordance with IFRS. In addition, we evaluated management’s impairment assessment including the identified triggers for impairment and challenged impairment calculations by assessing the future cash flow forecasts used in the models, and the process by which they were drawn up, including comparing them to the latest budgets provided by management. We challenged, amongst others, the following:
* Assumptions used in the Group’s budget and internal forecasts and the long-term growth rates by comparing them to economic and industry forecasts;
* The discount rate by assessing the cost of capital and other inputs including benchmarking with comparable organisations;
* The historical accuracy of budgets to actual results to determine whether cash flow forecasts are reliable based on past experience;
* The mechanics of the underlying calculations.

In performing the above work, we utilized our internal valuation experts to provide challenge and external market data to assess the reasonableness of the assumptions used by management. We evaluated the sensitivity analysis around the key drivers within the cash flow forecasts to ascertain the extent of change in those assumptions and also considered the likelihood of such a movement in those key assumptions arising. Whilst recognizing that cash flow forecasting, impairment modelling and valuations are all inherently judgmental, we concluded that the assumptions used by management were within an acceptable range of reasonable estimates.

Responsibilities of the board of directors for the preparation of the consolidated accounts

The board of directors is responsible for the preparation of consolidated accounts that give a true and fair view in accordance with International Financial Reporting Standards as adopted by the European Union and with the legal and regulatory requirements applicable in Belgium, and for such internal control as the board of directors determines is necessary to enable the preparation of consolidated accounts that are free from material misstatement, whether due to fraud or error. In preparing the consolidated accounts, the board of directors is responsible for assessing the Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the board of directors either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so.

Statutory auditor’s responsibilities for the audit of the consolidated accounts

Our objectives are to obtain reasonable assurance about whether the consolidated accounts as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated accounts.

In performing our audit, we comply with the legal, regulatory and normative framework applicable to the audit of the consolidated accounts in Belgium. A statutory audit does not provide any assurance as to the Group’s future viability nor as to the efficiency or effectiveness of the board of directors’ current or future business management at Group level. Our responsibilities in respect of the use of the going concern basis of accounting by the board of directors’ are described below.

As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
* Identify and assess the risks of material misstatement of the consolidated accounts, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control;
* Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control;
* Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the board of directors;
* Conclude on the appropriateness of the board of directors’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our statutory auditor’s report to the related disclosures in the consolidated accounts or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our statutory auditor’s report.# Auditor's Report (continued)

Responsibilities of the statutory auditor

In accordance with the Belgian standard which is complementary to the International Standards on Auditing (ISAs) as applicable in Belgium, our responsibility is to express an opinion on the consolidated financial statements. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the consolidated financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

We are responsible for the direction, supervision and performance of the Group audit. We remain solely responsible for our audit opinion.

We communicate with the audit committee regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. We also provide the audit committee with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with the audit committee, we determine those matters that were of most significance in the audit of the consolidated accounts of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter.

Other legal and regulatory requirements

Responsibilities of the board of directors

The board of directors is responsible for the preparation and the content of the directors’ report on the consolidated accounts and the other information included in the annual report on the consolidated accounts.

Statutory auditor’s responsibilities

In the context of our engagement and in accordance with the Belgian standard which is complementary to the International Standards on Auditing (ISAs) as applicable in Belgium, our responsibility is to verify, in all material respects, the directors’ report on the consolidated accounts and the other information included in the annual report on the consolidated accounts and to report on these matters.

Aspects related to the directors’ report on the consolidated accounts and to the other information included in the annual report on the consolidated accounts

In our opinion, after having performed specific procedures in relation to the directors’ report on the consolidated accounts, this directors’ report is consistent with the consolidated accounts for the year under audit and is prepared in accordance with article 3:32 of the Companies' and Associations' Code.

In the context of our audit of the consolidated accounts, we are also responsible for considering, in particular based on the knowledge acquired resulting from the audit, whether the directors’ report on the consolidated accounts and the other information included in the annual report on the consolidated accounts, is materially misstated or contains information which is inadequately disclosed or otherwise misleading.

In light of the procedures we have performed, there are no material misstatements we have to report to you.

The non-financial information required by virtue of article 3:32, §2 of the Companies' and Associations' Code is included in the directors’ report which is part of the section ‘Non-financial information’ of the annual report. The Company has prepared the non-financial information, based on the UN’s Sustainable Development Goals (SDG’s) reporting framework. However, in accordance with article 3:80, §1, 5° of the Companies' and Associations' Code, we do not express an opinion as to whether the non-financial information has been prepared in accordance with the UN’s Sustainable Development Goals (SDG’s) reporting framework as disclosed in the directors’ report on the consolidated accounts.

Statement related to independence

• Our registered audit firm and our network did not provide services which are incompatible with the statutory audit of the consolidated accounts, and our registered audit firm remained independent of the Group in the course of our mandate.
• The fees for additional services which are compatible with the statutory audit of the consolidated accounts referred to in article 3:65 of the Companies' and Associations' Code are correctly disclosed and itemized in the notes to the consolidated accounts.

European Uniform Electronic Format (ESEF)

We have also verified, in accordance with the draft standard on the verification of the compliance of the financial statements with the European Uniform Electronic Format (hereinafter “ESEF”), the compliance of the ESEF format with the regulatory technical standards established by the European Delegate Regulation No. 2019/815 of 17 December 2018 (hereinafter: “Delegated Regulation”).

The board of directors is responsible for the preparation, in accordance with ESEF requirements, of the consolidated financial statements in the form of an electronic file in ESEF format (hereinafter “digital consolidated financial statements”) included in the annual financial report. Our responsibility is to obtain sufficient appropriate evidence to conclude that the format and marking language of the digital consolidated financial statements comply in all material respects with the ESEF requirements under the Delegated Regulation.

Based on the work we have performed, we believe that the format of and marking of information in the digital consolidated financial statements included in the annual financial report of Viohalco SA per 31 December 2021 comply in all material respects with the ESEF requirements under the Delegated Regulation.

Other statements

• This report is consistent with the additional report to the audit committee referred to in article 11 of the Regulation (EU) N° 537/2014.

Diegem, 20 April 2022

The statutory auditor

PwC Reviseurs d'Entreprises SRL / PwC Bedrijfsrevisoren BV

Represented by Marc Daelman
Réviseur d’Entreprises / Bedrijfsrevisor

VIOHALCO | ANNUAL REPORT 2021 193

M. Declaration of responsible persons

Statement on the true and fair view of the consolidated financial statements and the fair overview of the management

In accordance with the article 12, §2, 3° of the Belgian Royal Decree of 14 November 2007, the members of the Executive Management, (i.e. Evangelos Moustakas, Ippokratis Ioannis Stassinopoulos, Efstratios Thomadakis, Panteleimon Mavrakis) declare that, on behalf and for the account of the Company, to the best of their knowledge:

a) the consolidated financial statements for the year ended 31 December 2021, which have been prepared in accordance with the International Financial Reporting Standards as adopted by the European Union, give a true and fair view of the Equity, Financial position and Financial Performance of the Company, and the entities included in the consolidation as a whole.

b) the management report on the consolidated financial statements includes a fair overview of the development and performance of the business and the position of the Company, and the entities included in the consolidation, together with the description of the main risks and uncertainties with which they are confronted.

VIOHALCO | ANNUAL REPORT 2021 195

In accordance with BCCA (Articles 3:17 and 3:36), the Company’s annual accounts are presented hereafter in a condensed version, which does not include all the notes required by law or the Statutory Auditor’s report. The full version of the Company’s annual accounts that shall be deposited with the National Bank of Belgium, is available on the Company’s website and can be obtained free of charge upon request. The Statutory Auditor’s report on the annual accounts was unqualified.

N. Condensed Statutory Balance Sheet and Income Statement

Statement of financial position

As at 31 December

Amounts in EUR thousands		2021	2020
Non-current assets		1,174,218	1,096,826
Start-up costs		0	57
Intangible assets		7	11
Tangible assets		18,625	19,083
Financial assets		1,153,373	1,075,462
Non-current receivables		2,214	2,214
Current assets		73,533	28,086
Current receivables		2,433	6,115
Short-term cash investment		65,000	20,000
Cash and cash equivalents		5,271	1,101
Accruals and deferred income		829	870
Total assets		1,247,751	1,124,912
Equity		1,216,931	1,117,479
Share capital		141,894	141,894
Share premium		528,113	528,113
Translation reserve		21,054	21,054
Other reserves		389,365	389,365
Retained earnings		136,506	37,053
Liabilities		30,820	7,434
Non-current payables		0	72
Current payables		30,451	7,032
Accrued charges and deferred income		368	330
Total equity and liabilities		1,247,751	1,124,912

VIOHALCO | ANNUAL REPORT 2021 196

Statement of Profit or Loss

For the year ended 31 December

Amounts in EUR thousands		2021	2020
Sales and services		761	435
Operating charges		-7,337	-5,673
Services and other goods		-4,971	-3,661
Remuneration, social security and pensions		-1,155	-1,043
Depreciation and amounts written off on start-up costs, intangible and tangible assets		-216	-413
Other operating charges		-994	-556
Operating profit (loss)		-6,576	-5,239
Finance income		143,464	17,407
Income from financial assets		122,475	14,022
Income from current assets		139	33
Non-recurring financial income		20,851	3,352
Finance charges		-6,717	-2,125
Debt charges		-4	-46
Other financial expenses		-95	-2
Non-recurring financial charges		-6,618	-2,077
Profit for the year before income taxes		130,171	10,042
Income tax expense		-4,800	-1,499
Profit/Loss (-)		125,371	8,544

VIOHALCO | ANNUAL REPORT 2021 197

The following explanations are intended to assist the general reader to understand certain terms used in this Annual Report. The definitions set out below apply throughout the annual report, unless the context requires otherwise.# Glossary

ASTM American Society for Testing and Material
BCCA the Belgian Code of Companies and Associations
Board of Directors the Board of Directors of the Company from time to time appointed in accordance with the Articles of Association
BS British Standards
DIN Deutsches Institut für Normung
EN European Norm
ISO 17025 General requirements for the competence of testing and calibration laboratories
FSMA Financial Services and Market Authority, which succeeded the Belgian Banking, Finance and Insurance Commission as the financial regulatory agency for Belgium on 1 April 2011
Gross annual return the gross annual return is calculated on the share price it equals to (change in price from January 1 to 31 December/share price on January)
HVAC & R Heating, ventilation, air-conditioning and refrigeration
IAS International Accounting Standards
IFRS International Financing Reporting Standards, as adopted by the EU
JIS Japanese Industrial Standards
LSAW Longitudinal Submerged Arc Welded Mill for the production of high-strength offshore and onshore energy pipes
SD Trade Mark
THN Mining profiles
Transparency Law the law of 2 May 2007 on the disclosure of significant shareholdings in issuers whose securities are admitted to trading on a regulated market
HFW high frequency induction welding unit
HSAW helically submerged arc welding unit
ERP application Enterprise resource planning application
SBQ Special bar quality steel
REIC Real Estate Investment Company
PMO Project Management Office
LV, MV & HV Low Voltage -Medium Voltage –Hi Voltage power cables
UPN European Standard channels

The annual report, the full versions of the statutory and consolidated annual accounts, as well as the audit reports regarding said annual accounts are available on the website (www.viohalco.com)

O. Glossary

VIOHALCO | ANNUAL REPORT 2021 198
VIOHALCO | ANNUAL REPORT 2021 199
VIOHALCO | ANNUAL REPORT 2021 200
www.viohalco.com

Viohalco S.A.
30 Marnix Avenue,
1000 Brussels,
Belgium
tel: (+32) 2 224 09 11

Viohalco S.A. – Greek Branch
16 Himaras Street,
151 25 Maroussi, Athens
Greece
tel: (+30) 210 6861 111

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