For the year ended 31 December 2022
MD MEDICAL GROUP INVESTMENTS PLC
C O N T E N T S
Page
1
2 - 7
Directors’ Responsibility Statement 8
Independent Auditors' Report 9 - 12
Consolidated Statement of Profit or Loss and Other Comprehensive Income 13
Consolidated Statement of Financial Position 14
Consolidated Statement of Changes in Equity 15 - 16
Consolidated Statement of Cash Flows 17 - 18
Notes to the Consolidated Financial Statements 19 - 52
Officers, Professional Advisors and Registered Office
Management Report
C O N T E N T S
Page
1
2 - 7
Directors’ Responsibility Statement 8
Independent Auditors' Report 9 - 12
Consolidated Statement of Profit or Loss and Other Comprehensive Income 13
Consolidated Statement of Financial Position 14
Consolidated Statement of Changes in Equity 15 - 16
Consolidated Statement of Cash Flows 17 - 18
Notes to the Consolidated Financial Statements 19 - 52
Officers, Professional Advisors and Registered Office
Management Report
1
MD MEDICAL GROUP INVESTMENTS PLC
OFFICERS, PROFESSIONAL ADVISORS AND REGISTERED OFFICE
Board of Directors Vladimir Mekler – Chairman
Mark Kurtser
Vitaly Ustimenko
Tatiana Lukina
Sergey Kalugin (appointed on 2 March 2022)
Secretary Menustrust Limited
Secretary assistant Darya Aleksandrova
Independent Auditors JSC “Kept”
Registered Office
15 Dimitriou Karatasou street, Anastasio Building,
6th floor, office 601, Strovolos,
2024, Nicosia, Cyprus
MD MEDICAL GROUP INVESTMENTS PLC
OFFICERS, PROFESSIONAL ADVISORS AND REGISTERED OFFICE
Board of Directors Vladimir Mekler – Chairman
Mark Kurtser
Vitaly Ustimenko
Tatiana Lukina
Sergey Kalugin (appointed on 2 March 2022)
Secretary Menustrust Limited
Secretary assistant Darya Aleksandrova
Independent Auditors JSC “Kept”
2
MD MEDICAL GROUP INVESTMENTS PLC
MANAGEMENT REPORT
INCORPORATION
PRINCIPAL ACTIVITY
FINANCIAL RESULTS
DIVIDENDS
26 October 2021.
29 November 2022.
25 May 2021.
31 December 2021: RUB6,143,026 thousand). The total assets of the Group as at 31 December 2022 were
RUB33,162,389 thousand (31 December 2021: RUB34,282,277 thousand) and the net assets were
RUB26,963,262 thousand (31 December 2021: RUB23,097,192 thousand).
On 19 March 2021 Board of Directors recommended the payment of RUB1,427,375 thousand as final
dividends for the year 2020 which corresponds to RUB19 per share. The dividends were paid on
The Board of Directors of MD Medical Group Investments Plc (the “Company”) presents to the members its
Annual Report together with the audited consolidated financial statements of the Company and its subsidiary
companies (the Company and its subsidiaries together referred to as the “Group”) for the year ended
MD Medical Group Investments Plc was incorporated in Cypru s on 5 August 2010 as a private
limited liability
company.On 22 August 2012 following special resolution passed by the shareholder, the name of the
Company was changed from “MD
Medical Group Investments
Ltd”
to
“MD
Medical Group Investments
Plc”
and
the Company was converted into a
public limited liability company .
The principal activity of the Company is that of an investment holding company and, for that purpose, to
acquire and hold controlling and other interests in the share or loan capital of any company or companies of
any nature, but primarily in the healthcare industry. Note 4 to these consolidated financial statements gives
more detailed information about the service provided by the Group`s medical centres.
The Group’s
results of operations are affected by a number of factors, including acquisitions, regulatory
conditions, demand for private healthcare services, patient capacity and utilisation rate, pricing and volume,
staff costs, capital expenditure programmes and currency exchange fluctuations.
The Group's financial results for the year ended 31 December 2022 and its financial position at that date are
set out in the consolidated statement of profit or loss and other comprehensive income on page 13 and in the
consolidated statement of financial position on page 14 of these consolidated financial statements.
31 December 2022.
Profit for the year ended 31 December 2022 amounted to RUB4,718,800 thousand (for the year ended
In accordance with the Company’s Articles of Association dividends may be paid out of its profits. To the
extent that the Company declares and pays dividends, owners of GDRs on the relevant record date will be
entitled to receive dividends in respect of ordinary shares underlying the GDRs.
The Company is a holding company and thus its ability to pay dividends depends on the ability of its
subsidiaries to pay dividends to the Company in accordance with relevant legislation in the country of their
incorporation and any contractual restrictions. The payment of such dividends by its subsidiaries is contingent
upon the sufficiency of their earnings, cash flows and distributable reserves.
On 3 September 2021 the Board of Directors recommended the payment of RUB1,352,249 thousand as
interim dividends which corresponds to RUB18 per share. The dividends were paid on
On 26 October 2022 the Board of Directors recommended the payment of RUB642,319 thousand as interim
dividends which corresponds to RUB8,55 per share. The dividends were paid on
MD MEDICAL GROUP INVESTMENTS PLC
MANAGEMENT REPORT
INCORPORATION
DIVIDENDS
26 October 2021.
29 November 2022.
25 May 2021.
31 December 2021: RUB6,143,026 thousand). The total assets of the Group as at 31 December 2022 were
RUB33,162,389 thousand (31 December 2021: RUB34,282,277 thousand) and the net assets were
RUB26,963,262 thousand (31 December 2021: RUB23,097,192 thousand).
On 19 March 2021 Board of Directors recommended the payment of RUB1,427,375 thousand as final
dividends for the year 2020 which corresponds to RUB19 per share. The dividends were paid on
The Board of Directors of MD Medical Group Investments Plc (the “Company”) presents to the members its
Annual Report together with the audited consolidated financial statements of the Company and its subsidiary
companies (the Company and its subsidiaries together referred to as the “Group”) for the year ended
MD Medical Group Investments Plc was incorporated in
company.
conditions, demand for private healthcare services, patient capacity and utilisation rate, pricing and volume,
staff costs, capital expenditure programmes and currency exchange fluctuations.
The Group's financial results for the year ended 31 December 2022 and its financial position at that date are
set out in the consolidated statement of profit or loss and other comprehensive income on page 13 and in the
consolidated statement of financial position on page 14 of these consolidated financial statements.
31 December 2022.
Profit for the year ended 31 December 2022 amounted to RUB4,718,800 thousand (for the year ended
In accordance with the Company’s Articles of Association dividends may be paid out of its profits. To the
extent that the Company declares and pays dividends, owners of GDRs on the relevant record date will be
entitled to receive dividends in respect of ordinary shares underlying the GDRs.
The Company is a holding company and thus its ability to pay dividends depends on the ability of its
subsidiaries to pay dividends to the Company in accordance with relevant legislation in the country of their
incorporation and any contractual restrictions. The payment of such dividends by its subsidiaries is contingent
upon the sufficiency of their earnings, cash flows and distributable reserves.
On 3 September 2021 the Board of Directors recommended the payment of RUB1,352,249 thousand as
interim dividends which corresponds to RUB18 per share. The dividends were paid on
On 26 October 2022 the Board of Directors recommended the payment of RUB642,319 thousand as interim
dividends which corresponds to RUB8,55 per share. The dividends were paid on
3
MD MEDICAL GROUP INVESTMENTS PLC
MANAGEMENT REPORT
(continued)
PRINCIPAL RISKS AND UNCERTAINTIES
DIRECTORS' INTEREST
Name Type of interest
Mark Kurtser Indirect ownership of shares
Kirill Dmitriev (resigned on 5 March 2022) Indirect interest in shares
Simon Rowlands (resigned on 9 March 2022) Direct ownership of shares
Vitaly Ustimenko Direct ownership of shares
67.90
5.55
0.33
Member of the Board of Directors Vitaly Ustimenko acquired GDRs on 27 May 2022 and 29 June 2022, as a
result the share of his ownership increased from 0.0053% to 0.0054% of the Сompany's share capital.
The Group operates in a highly regulated industry and is a subject to supervision by federal and local
authorities. As a result, the Group would be significantly affected by material changes to the existing, or
implementation of additional government regulations in Russia.
The Board of Directors has the overall responsibility for the establishment and supervision of the Company's
risk management framework.
Details in relation to principal risks and uncertainties and steps taken to manage these risks and uncertainties
are presented in Notes 23 and 25 of these consolidated financial statements.
The reputation, expertise and professionalism of the Group’s medical personnel are instrumental to the
Group’s ability to attract new and repeat patients. The Group’s operating success depends on its medical
personnel providing high-quality healthcare services throughout the Group’s medical network.
0.005
The direct and indirect interests of the members of the Board in titles of the Company as at
31 December 2022, 31 December 2021 and as at the date of signing these consolidated financial statements
are as follows:
Indirect interest in shares by Kirill Dmitriev arises through his capacity as key management personnel of
indirect shareholder.
Effective interest %
EXAMINATION OF THE DEVELOPMENT, POSITION AND PERFORMANCE OF THE ACTIVITIES OF
THE GROUP
The Group believes the experience, depth and diversity of its management team to be a distinct competitive
advantage in the complex and rapidly growing healthcare industry in which it operates.
The current financial position and performance of the Group as presented in these consolidated financial
statements is considered satisfactory.
The Group has developed its growth strategy to meet the increasing demand for high-quality private
healthcare services in Russia. The Group has grown significantly through strategic acquisitions and expansion
through the construction of new facilities.
The Group has one of the largest nationwide private healthcare regional networks for its core services and is
expanding into new services. It has significant experience in the provision of full-service private maternity
healthcare services. The Group has secured leading positions in the Russian private healthcare market across
a range of services including obstetrics and gynaecology, fertility and IVF treatments, and paediatrics. It has
also been diversifying its offering by adding other medical services for all family members, such as surgery,
urology, traumatology, cardiology, and oncology, etc. The recently opened facilities have been multi-
disciplinary from the very beginning.
The Group’s principal objective is to use its strong existing platform and experience in the regions to create a
scalable concept of establishing new regional hospitals and other medical facilities, utilising rigorous
investment decision-making process and targeting the most attractive regions and ensuring seamless
execution.
MD MEDICAL GROUP INVESTMENTS PLC
MANAGEMENT REPORT
(continued)
PRINCIPAL RISKS AND UNCERTAINTIES
DIRECTORS' INTEREST
Name Type of interest
Mark Kurtser Indirect ownership of shares
Kirill Dmitriev (resigned on 5 March 2022) Indirect interest in shares
Simon Rowlands (resigned on 9 March 2022) Direct ownership of shares
Vitaly Ustimenko Direct ownership of shares
67.90
5.55
0.33
Member of the Board of Directors Vitaly Ustimenko acquired GDRs on 27 May 2022 and 29 June 2022, as a
result the share of his ownership increased from 0.0053% to 0.0054% of the Сompany's share capital.
The Group operates in a highly regulated industry and is a subject to supervision by federal and local
authorities. As a result, the Group would be significantly affected by material changes to the existing, or
implementation of additional government regulations in Russia.
The Board of Directors has the overall responsibility for the establishment and supervision of the Company's
risk management framework.
Details in relation to principal risks and uncertainties and steps taken to manage these risks and uncertainties
are presented in Notes 23 and 25 of these consolidated financial statements.
The reputation, expertise and professionalism of the Group’s medical personnel are instrumental to the
Group’s ability to attract new and repeat patients. The Group’s operating success depends on its medical
personnel providing high-quality healthcare services throughout the Group’s medical network.
0.005
The direct and indirect interests of the members of the Board in titles of the Company as at
31 December 2022, 31 December 2021 and as at the date of signing these consolidated financial statements
are as follows:
Indirect interest in shares by Kirill Dmitriev arises through his capacity as key management personnel of
indirect shareholder.
Effective interest %
EXAMINATION OF THE DEVELOPMENT, POSITION AND PERFORMANCE OF THE ACTIVITIES OF
THE GROUP
The Group believes the experience, depth and diversity of its management team to be a distinct competitive
advantage in the complex and rapidly growing healthcare industry in which it operates.
The current financial position and performance of the Group as presented in these consolidated financial
statements is considered satisfactory.
The Group has developed its growth strategy to meet the increasing demand for high-quality private
healthcare services in Russia. The Group has grown significantly through strategic acquisitions and expansion
through the construction of new facilities.
The Group has one of the largest nationwide private healthcare regional networks for its core services and is
expanding into new services. It has significant experience in the provision of full-service private maternity
healthcare services. The Group has secured leading positions in the Russian private healthcare market across
a range of services including obstetrics and gynaecology, fertility and IVF treatments, and paediatrics. It has
also been diversifying its offering by adding other medical services for all family members, such as surgery,
urology, traumatology, cardiology, and oncology, etc. The recently opened facilities have been multi-
disciplinary from the very beginning.
The Group’s principal objective is to use its strong existing platform and experience in the regions to create a
scalable concept of establishing new regional hospitals and other medical facilities, utilising rigorous
investment decision-making process and targeting the most attractive regions and ensuring seamless
execution.
4
MD MEDICAL GROUP INVESTMENTS PLC
MANAGEMENT REPORT
(continued)
DIRECTORS' INTEREST (continued)
FUTURE DEVELOPMENTS
SHARE CAPITAL
BOARD OF DIRECTORS
THE BOARD COMMITTEES
Audit Committee
Following the resignation of Mr. Kirill Dmitriev and Mr. Simon Rowlands on 5 March 2022 and 9 March 2022,
respectively, Mr. Vitaly Ustimenko and Mr. Sergey Kalugin were appointed as other members of the audit
committee on 14 March 2022.
The Board of Directors leads the process in making new Board member appointments and makes
recommendations on appointments to shareholders. In accordance with the Appointment Policy for the Board
of Directors and Committees, all directors are subject to appointment or approval of appointment by
shareholders at the first Annual General Meeting after their appointment, and to re-appointment at intervals
of no more than three years. Any term beyond six years (e.g. two three-year terms) for a non-executive
director is subject to particularly rigorous review, and takes into account the need for progressive refreshing
of the Board of Directors.
The members of the Board of Directors who served as at the date of signing of these consolidated financial
statements, are presented on page 1.
Refer to Note 22 of these consolidated financial statements for the remuneration of the directors and other
key management personnel.
Since September 2012, the Board of Directors established the operation of the following three committees:
the Audit Committee, the Nomination Committee and the Remuneration Committee.
The Audit Committee comprises of three non-executive directors, two of whom are independent. The Audit
Committee has been chaired by independent non-executive director Tatiana Lukina since 6 December 2019,
Mr. Kirill Dmitriev and Mr. Simon Rowlands were the other members.
Kirill Dmitriev and Africa Platforms Capital LLP (represented by Simon Rowlands) stepped down as members
of the Board of Directors on 5 March 2022 and 9 March 2022 respectively.
Sergey Kalugin was appointed as an independent director in March 2022.
The calculation of effective interest is based on the total amount of issued and fully paid shares, including
treasury shares acquired by the Company.
As the Group will be growing it intends to expand its portfolio of hospital and outpatient facilities, broaden its
service offerings by providing patients with the most up-to-date treatment procedures and medical technology
available on the market, expand its services in Moscow and other regions, exploit the value of its integrated
healthcare network by making effective use of services across its facilities, optimising the benefits for patients
and the Group as a whole.
The Group’s goal is to continually diversify its medical services by expanding its range of services, maintaining
its leading position in the field of high-quality women’s health and paediatrics, as well as addressing the
increasing demand for private healthcare services inRussia and beyond
.
There were no changes in the share capital of the Company during the year.
MD MEDICAL GROUP INVESTMENTS PLC
MANAGEMENT REPORT
(continued)
DIRECTORS' INTEREST (continued)
FUTURE DEVELOPMENTS
SHARE CAPITAL
BOARD OF DIRECTORS
THE BOARD COMMITTEES
Audit Committee
Following the resignation of Mr. Kirill Dmitriev and Mr. Simon Rowlands on 5 March 2022 and 9 March 2022,
respectively, Mr. Vitaly Ustimenko and Mr. Sergey Kalugin were appointed as other members of the audit
committee on 14 March 2022.
The Board of Directors leads the process in making new Board member appointments and makes
recommendations on appointments to shareholders. In accordance with the Appointment Policy for the Board
of Directors and Committees, all directors are subject to appointment or approval of appointment by
shareholders at the first Annual General Meeting after their appointment, and to re-appointment at intervals
of no more than three years. Any term beyond six years (e.g. two three-year terms) for a non-executive
director is subject to particularly rigorous review, and takes into account the need for progressive refreshing
of the Board of Directors.
The members of the Board of Directors who served as at the date of signing of these consolidated financial
statements, are presented on page 1.
Refer to Note 22 of these consolidated financial statements for the remuneration of the directors and other
key management personnel.
Since September 2012, the Board of Directors established the operation of the following three committees:
the Audit Committee, the Nomination Committee and the Remuneration Committee.
The Audit Committee comprises of three non-executive directors, two of whom are independent. The Audit
Committee has been chaired by independent non-executive director Tatiana Lukina since 6 December 2019,
Mr. Kirill Dmitriev and Mr. Simon Rowlands were the other members.
Kirill Dmitriev and Africa Platforms Capital LLP (represented by Simon Rowlands) stepped down as members
of the Board of Directors on 5 March 2022 and 9 March 2022 respectively.
Sergey Kalugin was appointed as an independent director in March 2022.
The calculation of effective interest is based on the total amount of issued and fully paid shares, including
treasury shares acquired by the Company.
As the Group will be growing it intends to expand its portfolio of hospital and outpatient facilities, broaden its
service offerings by providing patients with the most up-to-date treatment procedures and medical technology
available on the market, expand its services in Moscow and other regions, exploit the value of its integrated
healthcare network by making effective use of services across its facilities, optimising the benefits for patients
and the Group as a whole.
The Group’s goal is to continually diversify its medical services by expanding its range of services, maintaining
its leading position in the field of high-quality women’s health and paediatrics, as well as addressing the
increasing demand for private healthcare services in
5
MD MEDICAL GROUP INVESTMENTS PLC
MANAGEMENT REPORT
(continued)
THE BOARD COMMITTEES
(continued)
Audit Committee (continued)
Internal audit
Nomination Committee
Remuneration Committee
The Remuneration Committee comprises of two non-executive directors and one executive director. The
Remuneration Committee was chaired by an independent non-executive director Mr. Simon Rowlands, who
stepped down on 9 March 2022. Mr. Sergey Kalugin was appointed as the chairman of the Remuneration
Committee on 14 March 2022. The two other members are Dr. Mark Kurtser and Mr. Vladimir Mekler.
The Nomination Committee comprises of one executive and two non-executive directors, one of whom is
independent. The Nomination Committee is chaired by non-executive director Mr. Vladimir Mekler
(since June 2016). Mr. Mark Kurtser and Mr. Simon Rowlands were the other members. Following the
resignation of Mr. Simon Rowlands on 9 March 2022, Mr. Sergey Kalugin was appointed as other member of
the audit committee on 14 March 2022.
The Audit Committee is responsible for monitoring and review the effectiveness of the Company’s internal
audit function. In this respect, the Audit Committee may require investigations by, or under the authority of,
the head of Internal Audit into any activities of the Group which may be of interest or concern to the Audit
Committee.
The Company`s internal auditor is responsible for the recommendation of an audit plan to the Audit
Committee. The internal auditor carries out auditing assignments in accordance with such plan and oversees
the Company`s compliance with the plan`s recommendations. The internal auditor files a quarterly report
with his findings to the Audit Committee.
The Audit Committee assists the Board of Directors in its oversight of the performance and leadership of the
internal audit activity.
Where the Audit Committee’s monitoring and review activities reveal cause for concern or scope for
improvement, it shall make recommendation to the Board of Directors on actions needed to address the
issues or to make improvements.
The Nomination Committee meets at least once a year and is responsible for assisting the Board of Directors
in discharging its corporate governance responsibilities in relation to appointment of all executive and non-
executive directors, as well as the CEO and CFO of the Company. The main objective of the Nomination
Committee is to lead the process for the Board of Directors’ appointments and make respective
recommendation to the Board of Directors, ensuring proper balance of the Board of Directors and qualification
of its members. The Nomination Committee also considers the composition of the Audit and Remuneration
Committees.
The Audit Committee meets at least four times each year and is responsible for considering:
• the audit process, including monitoring and review of the external auditors' performance, independence
and objectivity;
• development and implementation of the policy on non-audit services provided by the external auditors;
• monitoring compliance with laws and regulations and standard of corporate governance.
• the reliability and appropriateness of disclosures in the financial statements and external financial
communication;
• the maintenance of an effective system of internal controls including financial, operational and compliance
controls and risk management system;
• preparation of recommendations to the shareholders for approval in General Meetings in relation to the
appointment, reappointment and removal of the external auditors;
• approval of the remuneration and terms of engagement of the external auditors in respect of audit
services provided;
MD MEDICAL GROUP INVESTMENTS PLC
MANAGEMENT REPORT
(continued)
THE BOARD COMMITTEES
(continued)
Audit Committee (continued)
Internal audit
Nomination Committee
Remuneration Committee
The Remuneration Committee comprises of two non-executive directors and one executive director. The
Remuneration Committee was chaired by an independent non-executive director Mr. Simon Rowlands, who
stepped down on 9 March 2022. Mr. Sergey Kalugin was appointed as the chairman of the Remuneration
Committee on 14 March 2022. The two other members are Dr. Mark Kurtser and Mr. Vladimir Mekler.
The Nomination Committee comprises of one executive and two non-executive directors, one of whom is
independent. The Nomination Committee is chaired by non-executive director Mr. Vladimir Mekler
(since June 2016). Mr. Mark Kurtser and Mr. Simon Rowlands were the other members. Following the
resignation of Mr. Simon Rowlands on 9 March 2022, Mr. Sergey Kalugin was appointed as other member of
the audit committee on 14 March 2022.
The Audit Committee is responsible for monitoring and review the effectiveness of the Company’s internal
audit function. In this respect, the Audit Committee may require investigations by, or under the authority of,
the head of Internal Audit into any activities of the Group which may be of interest or concern to the Audit
Committee.
The Company`s internal auditor is responsible for the recommendation of an audit plan to the Audit
Committee. The internal auditor carries out auditing assignments in accordance with such plan and oversees
the Company`s compliance with the plan`s recommendations. The internal auditor files a quarterly report
with his findings to the Audit Committee.
The Audit Committee assists the Board of Directors in its oversight of the performance and leadership of the
internal audit activity.
Where the Audit Committee’s monitoring and review activities reveal cause for concern or scope for
improvement, it shall make recommendation to the Board of Directors on actions needed to address the
issues or to make improvements.
The Nomination Committee meets at least once a year and is responsible for assisting the Board of Directors
in discharging its corporate governance responsibilities in relation to appointment of all executive and non-
executive directors, as well as the CEO and CFO of the Company. The main objective of the Nomination
Committee is to lead the process for the Board of Directors’ appointments and make respective
recommendation to the Board of Directors, ensuring proper balance of the Board of Directors and qualification
of its members. The Nomination Committee also considers the composition of the Audit and Remuneration
Committees.
The Audit Committee meets at least four times each year and is responsible for considering:
• the audit process, including monitoring and review of the external auditors' performance, independence
and objectivity;
• development and implementation of the policy on non-audit services provided by the external auditors;
• monitoring compliance with laws and regulations and standard of corporate governance.
• the reliability and appropriateness of disclosures in the financial statements and external financial
communication;
• the maintenance of an effective system of internal controls including financial, operational and compliance
controls and risk management system;
• preparation of recommendations to the shareholders for approval in General Meetings in relation to the
appointment, reappointment and removal of the external auditors;
• approval of the remuneration and terms of engagement of the external auditors in respect of audit
services provided;
6
MD MEDICAL GROUP INVESTMENTS PLC
MANAGEMENT REPORT
(continued)
THE BOARD COMMITTEES
(continued)
Remuneration Committee (continued)
CORPORATE GOVERNANCE
• Appointment policy for the Board of Directors and Committees;
• Terms of reference of the Audit Committee, Nomination Committee and Remuneration Committee;
• Code of Ethics and Conduct;
• Business Continuity Policy;
• Disclosure Policy;
• Regulations on Insider Information;
• Risk Management Policy; and
• Anti-Fraud Policy.
INTERNAL CONTROL IN RELATION TO THE FINANCIAL REPORTING PROCESS
• Corporate Accounting policy Guidelines;
• Methodology for the Transformation of Financial Statements from RAS to IFRS;
• Methodology for the Consolidation of IFRS Financial Statements;
• Financial Reporting Preparation Procedure; and
• The Group’s structure.
The Company’s corporate governance policies and practices are designed to ensure that the Company is
focused on upholding its responsibilities to the shareholders.
The objective of this policу is to establish uniform procedures and to implement requirements for the
preparation of the consolidated financial statements of the Group. The procedure should be reviewed for
compliance with International Financial Reporting Standards as well as current conditions and planned
changes in the Group’s business activities at least once a year. When necessary, amendments and additions
to this Procedure should be adopted.
The Group has set formal policies and written term of reference in relation to the financial reporting process
that include:
The Company’s corporate governance policies and practices include, inter alia:
The Remuneration Committee meets at least once a year and is responsible for assisting the Board of
Directors in discharging its corporate governance responsibilities in relation to remuneration of all executive
directors and the chairman of the Board of Directors. The main objective of the Remuneration Committee is to
determine the framework and policy for the remuneration of the executive directors, the chairman of the
Board of Directors and senior executives, and the specific remuneration of each executive director and the
chairman of the Board of Directors and any compensation payments.
Since 2012, the Company has maintained full compliance with the UK Corporate Governance Code. The
Company is committed to the highest standards of corporate governance and transparency. The Board of
Directors recognises that good governance is a strategic asset that helps it to deliver consistent long term
value to its shareholders. By running the Company in an open way, the Board of Directors enables
shareholders to understand how it has been able to deliver consistently strong results. The Board of Directors
believes that corporate responsibility is an essential part of good governance and makes sound business
sense, as well as being crucial to the appropriate management of risk within the Company.
Improving its corporate governance structure in accordance with the internationally recognised best practices
the Company adopted important policies and procedures.
MD MEDICAL GROUP INVESTMENTS PLC
MANAGEMENT REPORT
(continued)
THE BOARD COMMITTEES
(continued)
Remuneration Committee (continued)
CORPORATE GOVERNANCE
• Appointment policy for the Board of Directors and Committees;
• Terms of reference of the Audit Committee, Nomination Committee and Remuneration Committee;
• Code of Ethics and Conduct;
• Business Continuity Policy;
• Disclosure Policy;
• Regulations on Insider Information;
• Risk Management Policy; and
• Anti-Fraud Policy.
INTERNAL CONTROL IN RELATION TO THE FINANCIAL REPORTING PROCESS
• Corporate Accounting policy Guidelines;
• Methodology for the Transformation of Financial Statements from RAS to IFRS;
• Methodology for the Consolidation of IFRS Financial Statements;
• Financial Reporting Preparation Procedure; and
• The Group’s structure.
The Company’s corporate governance policies and practices are designed to ensure that the Company is
focused on upholding its responsibilities to the shareholders.
The objective of this policу is to establish uniform procedures and to implement requirements for the
preparation of the consolidated financial statements of the Group. The procedure should be reviewed for
compliance with International Financial Reporting Standards as well as current conditions and planned
changes in the Group’s business activities at least once a year. When necessary, amendments and additions
to this Procedure should be adopted.
The Group has set formal policies and written term of reference in relation to the financial reporting process
that include:
The Company’s corporate governance policies and practices include, inter alia:
The Remuneration Committee meets at least once a year and is responsible for assisting the Board of
Directors in discharging its corporate governance responsibilities in relation to remuneration of all executive
directors and the chairman of the Board of Directors. The main objective of the Remuneration Committee is to
determine the framework and policy for the remuneration of the executive directors, the chairman of the
Board of Directors and senior executives, and the specific remuneration of each executive director and the
chairman of the Board of Directors and any compensation payments.
Since 2012, the Company has maintained full compliance with the UK Corporate Governance Code. The
Company is committed to the highest standards of corporate governance and transparency. The Board of
Directors recognises that good governance is a strategic asset that helps it to deliver consistent long term
value to its shareholders. By running the Company in an open way, the Board of Directors enables
shareholders to understand how it has been able to deliver consistently strong results. The Board of Directors
believes that corporate responsibility is an essential part of good governance and makes sound business
sense, as well as being crucial to the appropriate management of risk within the Company.
Improving its corporate governance structure in accordance with the internationally recognised best practices
the Company adopted important policies and procedures.
M
D MEDICAL GROUP INVESTMENTS PLC
M A N A G E M E N T REPOR T (continued)
MEETINGS OF SHAREHOLDERS
The Company shall i n each year hold a general meeting as its annual general meeting i n addition to any other
meetings in that year. An annual general meeting and any other sharenolders meeting called to pass a
special resolution can be convened by the Board of Directors by a notice, specitying the matters to be
discussed, issued at least 21 days before the meeting. Any other meetings shall be convened by the Board of
Directors by a notice, specitying the matters to be discussed, issued at least 14 days before the meeting. It
the notice period is less than 21 days or 14 days as applicable, the meeting will be deemed to have been duly
called if it is so agreed:
• in the case of a meeting called as the annual general meeting, by all the shareholders entitled to attend
and vote; and
• i n the case o f any other meeting, by a majority i n number of the members having a right to attend and
vote at the meeting, being a majority together holding not less than 95 per cent i n nominal value o f the
shares giving that right.
A notice convening a general meeting must be sent to each o f the shareholders.
A l l shareholders are entitled to attend the general meeting or be represented by a proxy authorised i n writing.
In the general meeting, on a poll, every share gives t h e holder the right to cast one vote, whereas, on a show
o r hands, each member has one vote. A corporate member may, by resolution of its directors o r other
governing body, authorise a person to act as its representative at any meeting o f the Company.
BRANCHES
M D Medical Group Investments Pic has a branch in Moscow.
TREASURY S H A R E S
During
t h e year ended
3
1 December 2022 the Company did not acquire any treasury
shares.
EVENTS AFTER THE REPORTING PERIOD
The events after the reporting date are disclosed i n Note 29 to the consolidated financial statements.
I N D E P E N D E N T A U D I T O R S
The independent auditors o f the Company Messrs. J S C "Kept" (formerly K P M G Limited) have expressed their
willingness to continue i n office. A resolution giving authority to the Board o f Directors to fi x their
remuneration will be submitted to the Annual General Meeting.
B y order of the Board of Directors,
Vladimir Mekler
Chairman of the Board of Directors
Moscow, 31 March 2023
M a r k Kurtser
Managing Director, member of the board o f Directors
~
M A N A G E M E N T REPOR T (continued)
MEETINGS OF SHAREHOLDERS
The Company shall i n each year hold a general meeting as its annual general meeting i n addition to any other
meetings in that year. An annual general meeting and any other sharenolders meeting called to pass a
special resolution can be convened by the Board of Directors by a notice, specitying the matters to be
discussed, issued at least 21 days before the meeting. Any other meetings shall be convened by the Board of
Directors by a notice, specitying the matters to be discussed, issued at least 14 days before the meeting. It
the notice period is less than 21 days or 14 days as applicable, the meeting will be deemed to have been duly
called if it is so agreed:
• in the case of a meeting called as the annual general meeting, by all the shareholders entitled to attend
and vote; and
• i n the case o f any other meeting, by a majority i n number of the members having a right to attend and
vote at the meeting, being a majority together holding not less than 95 per cent i n nominal value o f the
shares giving that right.
A notice convening a general meeting must be sent to each o f the shareholders.
A l l shareholders are entitled to attend the general meeting or be represented by a proxy authorised i n writing.
In the general meeting, on a poll, every share gives t h e holder the right to cast one vote, whereas, on a show
o r hands, each member has one vote. A corporate member may, by resolution of its directors o r other
governing body, authorise a person to act as its representative at any meeting o f the Company.
BRANCHES
M D Medical Group Investments Pic has a branch in Moscow.
The events after the reporting date are disclosed i n Note 29 to the consolidated financial statements.
I N D E P E N D E N T A U D I T O R S
The independent auditors o f the Company Messrs. J S C "Kept" (formerly K P M G Limited) have expressed their
willingness to continue i n office. A resolution giving authority to the Board o f Directors to fi x their
remuneration will be submitted to the Annual General Meeting.
B y order of the Board of Directors,
Vladimir Mekler
Chairman of the Board of Directors
Moscow, 31 March 2023
M a r k Kurtser
Managing Director, member of the board o f Directors
~
MD
MEDICAL
G R O U P INVESTMENTS
PLO
DIRECTORS' RESPONSIBILITY ST A TEMENT
The company's board o f Directors is responsible for the preparation of consolidated financial statements that
give a true and fair view in accordance with International Financial Reporting standards as adopted by the
European Union, and for such internal control as the Board ofDirectors determines i s necessary to enable the
preparation o f consolidated financial statements that are free from material misstatement, whether due to
Traud or error.
This responsibility includes selecting appropriate accounting policies and applying them consistently; and
making accounting estimates and judgements that are reasonable in the circumstances.
In
preparing the consolidated financial statements, the Board of Directors is also 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
company
or to cease operations, or
has no realistic alternative but to do
so.
Those charged with governance are responsible for overseeing the Group's financial reporting process.
The Board of Directors' confirmations
The Board of Directors confirms that, to the best of its knowledge:
(a) the consolidated financial statements, which are presented on pages 1 9 to 52, which have been prepared
i n accordance with International Financial Reporting Standards as adopted by the European Union, give a true
and fair view o f the assets, liabilities, financial position and profit or loss o fthe Company and the undertakings
included in the consolidation taken as a whole; and
(b) the management report includes a fair review o f the development and performance o f the business and
the position of the Company and the undertakings included i n the consolidation taken as a whole, together
with a description of the principal risks and uncertainties that it faces/they face.
Further, t h e Board of Directors confirms that, to the best o f its knowledge:
( adequate accounting records have been maintained which disclose with reasonable accuracy the financial
position of the Group and explain its transactions;
(it) all information of which it i s aware that is relevant to the preparation of the consolidated financial
statements, such as accounting records and all other relevant records and documentation, has been made
available to the Company's auditors;
By order of the Board of Directors,
VladimirMekler
Chairman o ft h e Board of Directors
Moscow, 3 1 March 2023
Mark/Kurtser
M a r a g i n g Director , m e m b e r o f t h e B o a r d o f D i r e c t o r s
DIRECTORS' RESPONSIBILITY ST A TEMENT
The company's board o f Directors is responsible for the preparation of consolidated financial statements that
give a true and fair view in accordance with International Financial Reporting standards as adopted by the
European Union, and for such internal control as the Board ofDirectors determines i s necessary to enable the
preparation o f consolidated financial statements that are free from material misstatement, whether due to
Traud or error.
This responsibility includes selecting appropriate accounting policies and applying them consistently; and
making accounting estimates and judgements that are reasonable in the circumstances.
The Board of Directors' confirmations
The Board of Directors confirms that, to the best of its knowledge:
(a) the consolidated financial statements, which are presented on pages 1 9 to 52, which have been prepared
i n accordance with International Financial Reporting Standards as adopted by the European Union, give a true
and fair view o f the assets, liabilities, financial position and profit or loss o fthe Company and the undertakings
included in the consolidation taken as a whole; and
(b) the management report includes a fair review o f the development and performance o f the business and
the position of the Company and the undertakings included i n the consolidation taken as a whole, together
with a description of the principal risks and uncertainties that it faces/they face.
Further, t h e Board of Directors confirms that, to the best o f its knowledge:
( adequate accounting records have been maintained which disclose with reasonable accuracy the financial
position of the Group and explain its transactions;
(it) all information of which it i s aware that is relevant to the preparation of the consolidated financial
statements, such as accounting records and all other relevant records and documentation, has been made
available to the Company's auditors;
By order of the Board of Directors,
VladimirMekler
Chairman o ft h e Board of Directors
Moscow, 3 1 March 2023
Mark/Kurtser
M a r a g i n g Director , m e m b e r o f t h e B o a r d o f D i r e c t o r s
USC "Kept"
Naberezhnaya Tower Complex, BlocK U
10 P r e s e n s k a y a N a b e r e z h n a y a
Moscow, Russia 123112
Telephone +7 (495) 937 4477
F a x +7 (495) 9 3 7 4 4 9 9
k e p t
Independent Auditors' Report
To the Shareholders of MD MEDICAL GROUP INVESTMENTS PLC
O p i n i o n
We have audited the consolidated financial statements of MD MEDICAL GROUP INVESTMENTS PLC (the
"Company") and its subsidiaries (the "Group"), which comprise the consolidated statement o f financial
position a s at 31 December 2022, the consolidated statements of profit o r loss and other comprehensive
income, changes i n equity and cash flows f o r the year then ended, and notes, comprising significant
accounting policies and other explanatory information.
In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the
consolidated financial position of the Group a s at 31 December 2022, and 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 (IFRS-EU).
Basis for Opinion
We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities
under t h o s e standards are further d e s c r i b e d in t h e Auditors'Responsibilities for the Audit of t h e Consolidated
Financial Statements section of our report. We are independent of the Group i n accordance with the
independence requirements that are relevant to our audit of the consolidated financial statements in the
R u s s i a n F e d e r a t i o n a n d with the International Ethics S t a n d a r d s B o a r d for A c c o u n t a n t s International C o d e of
Ethics for Professional Accountants (including International Independence Standards) (IESBA Code), and
we have fulfilled our other ethical responsibilities in accordance with the requirements in the Russian
Federation and the IESBA Code. We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our opinion.
k e y Audit Matters
Key audit matters are those matters that, i n our professional judgment, were o f most significance i n our audit
of the consolidated financial statements of the current period. These matters were addressed in the context
of our audit of the consolidated financial statements as awhole, and i n forming our opinion thereon, and we
d o not provide a s e p a r a t e opinion o n t h e s e m a t t e r s .
Impairmento fgoodwilla n dproperty,p l a n ta n dequipment
P l e a s e refer to the Note 13 and 14 in the consolidated financial statements.
The key audit m a t t e r H o w t h e m a t t e r w a s a d d r e s s e d in o u r a u d i t
During the year, the Group recognized a n Our audit procedures included:
impairment o f the property, plant and
equipment o f one of its c a s h generating units assessment of whether the CGUs were
(the "CGUs") in the amount of RUB appropriately determined and evaluation of the
1,000,015 thousand a s well a s an methodology applied by management I n
i m p a i r m e n t of goodwill relating to another impairment testing;
Audited e n t i t y :M DMEDICALG R O U PINVESTMENTS P L C
Registrationnumberi nt h eCyprusRegistraro fCompanies.
N o . H E 2 1 7 6 0 2
I n d e p e n d e n t auditor.J S C " K e p t
Naberezhnaya Tower Complex, BlocK U
10 P r e s e n s k a y a N a b e r e z h n a y a
Moscow, Russia 123112
Telephone +7 (495) 937 4477
F a x +7 (495) 9 3 7 4 4 9 9
k e p t
Independent Auditors' Report
To the Shareholders of MD MEDICAL GROUP INVESTMENTS PLC
O p i n i o n
We have audited the consolidated financial statements of MD MEDICAL GROUP INVESTMENTS PLC (the
"Company") and its subsidiaries (the "Group"), which comprise the consolidated statement o f financial
position a s at 31 December 2022, the consolidated statements of profit o r loss and other comprehensive
income, changes i n equity and cash flows f o r the year then ended, and notes, comprising significant
accounting policies and other explanatory information.
In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the
consolidated financial position of the Group a s at 31 December 2022, and 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 (IFRS-EU).
Basis for Opinion
We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities
under t h o s e standards are further d e s c r i b e d in t h e Auditors'Responsibilities for the Audit of t h e Consolidated
Financial Statements section of our report. We are independent of the Group i n accordance with the
independence requirements that are relevant to our audit of the consolidated financial statements in the
R u s s i a n F e d e r a t i o n a n d with the International Ethics S t a n d a r d s B o a r d for A c c o u n t a n t s International C o d e of
Ethics for Professional Accountants (including International Independence Standards) (IESBA Code), and
we have fulfilled our other ethical responsibilities in accordance with the requirements in the Russian
Federation and the IESBA Code. We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our opinion.
k e y Audit Matters
Key audit matters are those matters that, i n our professional judgment, were o f most significance i n our audit
of the consolidated financial statements of the current period. These matters were addressed in the context
of our audit of the consolidated financial statements as awhole, and i n forming our opinion thereon, and we
d o not provide a s e p a r a t e opinion o n t h e s e m a t t e r s .
Impairmento fgoodwilla n dproperty,p l a n ta n dequipment
P l e a s e refer to the Note 13 and 14 in the consolidated financial statements.
The key audit m a t t e r H o w t h e m a t t e r w a s a d d r e s s e d in o u r a u d i t
During the year, the Group recognized a n Our audit procedures included:
impairment o f the property, plant and
equipment o f one of its c a s h generating units assessment of whether the CGUs were
(the "CGUs") in the amount of RUB appropriately determined and evaluation of the
1,000,015 thousand a s well a s an methodology applied by management I n
i m p a i r m e n t of goodwill relating to another impairment testing;
Audited e n t i t y :M DMEDICALG R O U PINVESTMENTS P L C
Registrationnumberi nt h eCyprusRegistraro fCompanies.
N o . H E 2 1 7 6 0 2
I n d e p e n d e n t auditor.J S C " K e p t
MD
MEDICAL G R O U P I N V E S T M E N T S
P L C
Independent Auditors' Report
Page 2
к е р т
CGU in the amount of RUB 201,034 assessment of appropriateness of key i n p u t s used
t h o u s a n d . and assumptions applied i n forming the discounted
w e consider the issue as a key audit matter cash f r o w s models, such as estimated r e v e n u e and
d u e to i n h e r e n t e s t i m a t i o n u n c e r t a i n t y in profitability growth, b y comparing them to
Torecasting Tuture c a s h flows which form the historical results and critically challenging the
basis for the a s s e s s m e n t of recoverability forecasted a m o u n t s .
a n d significant m a n a g e m e n t j u d g e m e n t W e involved our own valuation specialists to assist u s in
i n v o l v e d i n d e t e r m i n a t i o n of t h e r e c o v e r a b l e evaluating the appropriateness of the weighted-average
a m o u n t . cost o f capital (discount rate), CAPEX i n post-projection
period, long-term growth rate, length of the projection
period.
w e also assessed the completeness and consistency of the
disclosures in the consolidated financial statements in
relation to this matter.
R e v e n u erecognition
P l e a s e refer to the N o t e 4 in the c o n s o l i d a t e d fi n a n c i a l s t a t e m e n t s .
The key audit m a t t e r H o w t h e m a t t e r w a s a d d r e s s e d in o u r a u d i t
Revenue is a material amount consisting of Our audit procedures i n this area included, among others,
a high volume of individualy low value the following ones.
transactions. The Group u s e s special W e t e s t e d general IT controls and application-level controls
Medialog system to calculate revenue,
w h e r e r e v e n u e d a t a is a u t o m a t i c a l l y relevant to revenue recognition. We involved our
transferred therefrom to the accounting Information risk management specialists, who assisted us
system. Thus, the g r o u p relles on results in performing the following procedures:
of operations of these systems. to test u s e r s and administrators access rights and
T h e most significant risks of revenue password setting controls in Medialog;
m i s s t a t e m e n t a r i s e d u e t o p o t e n t i a l i n c o r r e c t to test Medialog's automatic links of tickets issued
d a t a on volume an d value of the services for the provision of services to invoices and
provided. payments, including the function t o link tickets to
a particular service contract;
to test that revenue data is accurately transferred
from Medialog to the accounting system;
W e reconciled Medialog data to accounting ledgers.
Further we reconciled the recognized revenue adjusted for
the balances o f settlements with customers at the
beginning and the end of the reporting period, with the
amounts of payments recorded in the accounting system;
and reconciled the amounts of payments received from
customers with external bank confirmations. We also
obtained confirmation letters from debtors (legal entities)
on a sample basis to confirm balances and turnover.
in addition, w e analyzed the revenue structure, its' key
t r e n d s a n d c o r r e l a t i o n s .
Independent Auditors' Report
Page 2
к е р т
CGU in the amount of RUB 201,034 assessment of appropriateness of key i n p u t s used
t h o u s a n d . and assumptions applied i n forming the discounted
w e consider the issue as a key audit matter cash f r o w s models, such as estimated r e v e n u e and
d u e to i n h e r e n t e s t i m a t i o n u n c e r t a i n t y in profitability growth, b y comparing them to
Torecasting Tuture c a s h flows which form the historical results and critically challenging the
basis for the a s s e s s m e n t of recoverability forecasted a m o u n t s .
a n d significant m a n a g e m e n t j u d g e m e n t W e involved our own valuation specialists to assist u s in
i n v o l v e d i n d e t e r m i n a t i o n of t h e r e c o v e r a b l e evaluating the appropriateness of the weighted-average
a m o u n t . cost o f capital (discount rate), CAPEX i n post-projection
period, long-term growth rate, length of the projection
period.
w e also assessed the completeness and consistency of the
disclosures in the consolidated financial statements in
relation to this matter.
R e v e n u erecognition
P l e a s e refer to the N o t e 4 in the c o n s o l i d a t e d fi n a n c i a l s t a t e m e n t s .
The key audit m a t t e r H o w t h e m a t t e r w a s a d d r e s s e d in o u r a u d i t
Revenue is a material amount consisting of Our audit procedures i n this area included, among others,
a high volume of individualy low value the following ones.
transactions. The Group u s e s special W e t e s t e d general IT controls and application-level controls
Medialog system to calculate revenue,
w h e r e r e v e n u e d a t a is a u t o m a t i c a l l y relevant to revenue recognition. We involved our
transferred therefrom to the accounting Information risk management specialists, who assisted us
system. Thus, the g r o u p relles on results in performing the following procedures:
of operations of these systems. to test u s e r s and administrators access rights and
T h e most significant risks of revenue password setting controls in Medialog;
m i s s t a t e m e n t a r i s e d u e t o p o t e n t i a l i n c o r r e c t to test Medialog's automatic links of tickets issued
d a t a on volume an d value of the services for the provision of services to invoices and
provided. payments, including the function t o link tickets to
a particular service contract;
to test that revenue data is accurately transferred
from Medialog to the accounting system;
W e reconciled Medialog data to accounting ledgers.
Further we reconciled the recognized revenue adjusted for
the balances o f settlements with customers at the
beginning and the end of the reporting period, with the
amounts of payments recorded in the accounting system;
and reconciled the amounts of payments received from
customers with external bank confirmations. We also
obtained confirmation letters from debtors (legal entities)
on a sample basis to confirm balances and turnover.
in addition, w e analyzed the revenue structure, its' key
t r e n d s a n d c o r r e l a t i o n s .
MD MEDICAL
G R O U PI N V E S T M E N T S P L C
independent Auditors R e p o r t
P a g e 3 к е р т
O t h e r I n f o r m a t i o n
Management is responsible for the other information. The other information comprises the Management
Report, the Directors' Responsibility Statement andt h e Annual Report, but does not include the consolidated
financial s t a t e m e n t s and our a u d i t o r s report thereon.
O u r opinion o n t h e c o n s o l i d a t e d fi n a n c i a l s t a t e m e n t s d o e s not c o v e r the o t h e r information a n d w e d o not
express any form of assurance conclusion thereon.
I n connection with our audit of the consolidated financial statements, our responsibility is to read the other
information and, in doing so, consider whether the other information is materially inconsistent with the
consolidated financial statements or our knowledge obtained in the audit, or otherwise appears to be
materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact. We have nothing to r e p o r t in this regard.
Responsibilities of Management and Those Charged with Governance for the
c o n s o l i d a t e d F i n a n c i a l S t a t e m e n t s
Management is responsible for the preparation and fair presentation of the consolidated financial statements
in accordance with IFRS-EU, and for such internal control as management determines is necessary to enable
the preparation of consolidated financial statements that are free from material misstatement, whether due
to f r a u d or error.
in preparing the consolidated financial statements, management is responsible for assessing the Group's
ability to continue a s a going concern, disclosing, a s applicable, matters related to going concern and using
the going concern basis o f accounting unless management either intends toliquidate the Group o r to cease
o p e r a t i o n s , or h a s no realistic alternative b u t to d o so.
Those charged with governance are responsible for overseeing the Group's financial reporting process.
Auditors' Responsibilities for the Audit of the consolidated Financial Statements
O u r o b j e c t i v e s a r e to obtain r e a s o n a b l e a s s u r a n c e a b o u t w h e t h e r t h e c o n s o l i d a t e d financial s t a t e m e n t s a s a
whole are free from material misstatement, whether due to fraud or error, and to issue an auditors' report that
includes our opinion. Reasonable a s s u r a n c e is a high level of assurance, but is not a guarantee that an audit
conducted i n accordance with ISAs will always detect a material misstatement when it exists. Misstatements
can arisefrom fraud o r error and are consideredmaterial it, individually o r in t h eaggregate, they could
reasonably be e x p e c t e d to influence the economic decisions of users taken on the basis of these consolidated
financial statements.
As part o f an audit in accordance with ISAs, we exercise professional judgment and maintain professional
scepticism throughout theaudit. W e also:
•
identity and a s s e s s the risks of material misstatement of the consolidated financial statements, 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 n o t detecting a
material misstatement resulting from fraud is higher than for o n e resulting from error, a s fraud may involve
collusion, forgery, intentional omissions, misrepresentations, or the override o f internal control.
Obtain an understanding of internal control relevant to the audit i n order to design audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness o f the Group's internal control.
•
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
e s t i m a t e s a n d related d i s c l o s u r e s m a d e b y m a n a g e m e n t .
•
conclude on the appropriateness of management's 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. I f we
independent Auditors R e p o r t
P a g e 3 к е р т
O t h e r I n f o r m a t i o n
Management is responsible for the other information. The other information comprises the Management
Report, the Directors' Responsibility Statement andt h e Annual Report, but does not include the consolidated
financial s t a t e m e n t s and our a u d i t o r s report thereon.
O u r opinion o n t h e c o n s o l i d a t e d fi n a n c i a l s t a t e m e n t s d o e s not c o v e r the o t h e r information a n d w e d o not
express any form of assurance conclusion thereon.
I n connection with our audit of the consolidated financial statements, our responsibility is to read the other
information and, in doing so, consider whether the other information is materially inconsistent with the
consolidated financial statements or our knowledge obtained in the audit, or otherwise appears to be
materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact. We have nothing to r e p o r t in this regard.
Responsibilities of Management and Those Charged with Governance for the
c o n s o l i d a t e d F i n a n c i a l S t a t e m e n t s
Management is responsible for the preparation and fair presentation of the consolidated financial statements
in accordance with IFRS-EU, and for such internal control as management determines is necessary to enable
the preparation of consolidated financial statements that are free from material misstatement, whether due
to f r a u d or error.
in preparing the consolidated financial statements, management is responsible for assessing the Group's
ability to continue a s a going concern, disclosing, a s applicable, matters related to going concern and using
the going concern basis o f accounting unless management either intends toliquidate the Group o r to cease
o p e r a t i o n s , or h a s no realistic alternative b u t to d o so.
Those charged with governance are responsible for overseeing the Group's financial reporting process.
Auditors' Responsibilities for the Audit of the consolidated Financial Statements
O u r o b j e c t i v e s a r e to obtain r e a s o n a b l e a s s u r a n c e a b o u t w h e t h e r t h e c o n s o l i d a t e d financial s t a t e m e n t s a s a
whole are free from material misstatement, whether due to fraud or error, and to issue an auditors' report that
includes our opinion. Reasonable a s s u r a n c e is a high level of assurance, but is not a guarantee that an audit
conducted i n accordance with ISAs will always detect a material misstatement when it exists. Misstatements
can arisefrom fraud o r error and are consideredmaterial it, individually o r in t h eaggregate, they could
reasonably be e x p e c t e d to influence the economic decisions of users taken on the basis of these consolidated
financial statements.
As part o f an audit in accordance with ISAs, we exercise professional judgment and maintain professional
scepticism throughout theaudit. W e also:
•
identity and a s s e s s the risks of material misstatement of the consolidated financial statements, 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 n o t detecting a
material misstatement resulting from fraud is higher than for o n e resulting from error, a s fraud may involve
collusion, forgery, intentional omissions, misrepresentations, or the override o f internal control.
Obtain an understanding of internal control relevant to the audit i n order to design audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness o f the Group's internal control.
•
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
e s t i m a t e s a n d related d i s c l o s u r e s m a d e b y m a n a g e m e n t .
•
conclude on the appropriateness of management's 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. I f we
MD MEDICAL
G R O U P I N V E S T M E N T S P L C
Independent Auditors' Report
P a g e 4
k e p t
conclude that a material uncertainty exists, we are required to draw attention in o u r auditors report to t h e
related disclosures i n the consolidated financial statements or, i f such disclosures are inadequate, to
modity our opinion. Our conclusions are b a s e d on the audit evidence obtained up to the date of our
auditors report. However, future events o r conditions may cause the Group to c e a s e to continue as a
going c o n c e r n .
Evaluate 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 m a n n e r t h a t achieves fair presentation.
•
Obtain sufficient appropriate audit evidence regarding the financial information o f the entities o r business
activities within the Group to express an opinion on the consolidated tinancial statements. We are
responsible for the direction, supervision and performance of the group audit. We remain solely
responsible for our audit opinion.
w e communicate with those charged with governance regarding, among other matters, the planned scope
and timing of the audit and significant audit findings, including any significant deficiencies i n internal control
that we identity during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical
requirements regarding independence, andcommunicate with them all relationships and other mattersthat
may reasonably be thought to bear on our independence, and where applicable, actions taken to eliminate
t h r e a t s or s a t e g u a r d s applied.
From the matters communicated with those charged with governance, we determine those matters that were
o f most significance i n the audit o f the consolidated financial statements o f the current period and are
therefore the key audit matters. We describe these matters in our auditors' report unless law or regulation
p r e c l u d e s public d i s c l o s u r e a b o u t the m a t t e r o r w h e n , in e x t r e m e l y rare c i r c u m s t a n c e s , w e d e t e r m i n e that a
matter should not be communicated in our report b e c a u s e the adverse consequences of doing so would
reasonably be expected to outweigh the public interest benefits of such communication.
К е р і Koliadko E.GIE
Principal registration dumbesof the entry i n the Register o f Auditors and Audit organizations
No. 22006023423, acts o nbehalf o f the audit organization based on the power of attorney No. 3/23 as o f
1 7 February 2023
JSC "Kept"
Principal registration number of the entry in the Register of Auditors and Audit Organizations No.
12006020351
M o s c o w, R u s s i a
31 March 2 0 2 3
Independent Auditors' Report
P a g e 4
k e p t
conclude that a material uncertainty exists, we are required to draw attention in o u r auditors report to t h e
related disclosures i n the consolidated financial statements or, i f such disclosures are inadequate, to
modity our opinion. Our conclusions are b a s e d on the audit evidence obtained up to the date of our
auditors report. However, future events o r conditions may cause the Group to c e a s e to continue as a
going c o n c e r n .
Evaluate 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 m a n n e r t h a t achieves fair presentation.
•
Obtain sufficient appropriate audit evidence regarding the financial information o f the entities o r business
activities within the Group to express an opinion on the consolidated tinancial statements. We are
responsible for the direction, supervision and performance of the group audit. We remain solely
responsible for our audit opinion.
w e communicate with those charged with governance regarding, among other matters, the planned scope
and timing of the audit and significant audit findings, including any significant deficiencies i n internal control
that we identity during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical
requirements regarding independence, andcommunicate with them all relationships and other mattersthat
may reasonably be thought to bear on our independence, and where applicable, actions taken to eliminate
t h r e a t s or s a t e g u a r d s applied.
From the matters communicated with those charged with governance, we determine those matters that were
o f most significance i n the audit o f the consolidated financial statements o f the current period and are
therefore the key audit matters. We describe these matters in our auditors' report unless law or regulation
p r e c l u d e s public d i s c l o s u r e a b o u t the m a t t e r o r w h e n , in e x t r e m e l y rare c i r c u m s t a n c e s , w e d e t e r m i n e that a
matter should not be communicated in our report b e c a u s e the adverse consequences of doing so would
reasonably be expected to outweigh the public interest benefits of such communication.
К е р і Koliadko E.GIE
Principal registration dumbesof the entry i n the Register o f Auditors and Audit organizations
No. 22006023423, acts o nbehalf o f the audit organization based on the power of attorney No. 3/23 as o f
1 7 February 2023
JSC "Kept"
Principal registration number of the entry in the Register of Auditors and Audit Organizations No.
12006020351
M o s c o w, R u s s i a
31 March 2 0 2 3
13
MD MEDICAL GROUP INVESTMENTS PLC
For the year ended 31 December 2022
Note 2022 2021
RUB'000
RUB'000
Revenue 425,222,056
25,219,683
Cost of sales 5 (15,428,617 )
(15,231,775 )
Gross profit9,793,439
9,987,908
Other income 836,141
104,424
Selling, general and administrative expenses 6 (3,513,145 )
(3,402,362 )
Impairment loss 13, 14 (1,286,574 )
-
Other expenses 8 (60,510 )
(68,007 )
Operating profit4,969,351
6,621,963
Finance income 9355,825
93,683
Finance expenses 9 (494,039 )
(549,361 )
Net foreign exchange transactions loss 9 (104,751 )
(8,017 )
Net finance expenses
9
(242,965 )
(463,695 )
Profit before tax4,726,386
6,158,268
Income tax expense 10 (7,586 )
(15,242 )
Profit for the year4,718,800
6,143,026
Total comprehensive income for the year4,718,800
6,143,026
Profit for the year attributable to:
Owners of the Company4,560,217
6,003,486
Non-controlling interests158,583
139,540
4,718,800
6,143,026
Total comprehensive income for the year attributable to:
Owners of the Company4,560,217
6,003,486
Non-controlling interests158,583
139,540
4,718,800
6,143,026
Earnings per share (RUB) 1160.70
79.91
The Notes on pages 19 to 52 are an integral part of these consolidated financial statements.
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
MD MEDICAL GROUP INVESTMENTS PLC
For the year ended 31 December 2022
Note 2022 2021
RUB'000
RUB'000
Revenue 4
Cost of sales 5 (
Gross profit
Other income 8
Selling, general and administrative expenses 6 (
Impairment loss 13, 14 (
Other expenses 8 (
Operating profit
Finance income 9
Finance expenses 9 (
Net foreign exchange transactions loss 9 (
Net finance expenses
9
(
(
Profit before tax
Income tax expense 10 (
Profit for the year
Total comprehensive income for the year
Profit for the year attributable to:
Owners of the Company
Non-controlling interests
Total comprehensive income for the year attributable to:
Owners of the Company
Non-controlling interests
Earnings per share (RUB) 11
The Notes on pages 19 to 52 are an integral part of these consolidated financial statements.
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
14
MD MEDICAL GROUP INVESTMENTS PLC
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As a t 31 D e c e m b e r 2022
ASSETS
Property, plant and equipment
Intangible assets
Trade, other receivables and deferred expenses
D e f e r r e d t a x a s s e t s
To t a l n o n - c u r r e n t a s s e t s
I n v e n t o r i e s
Trade, other receivables and deferred expenses
c a s h and cash equivalents
Total current assets
To t a l a s s e t s
EQUITY
s h a r e c a p i t a l
Share premium
Reserves
Retained earnings
Total equity attributable to the owners of t h e Company
Non-controlling interests
To t a l e q u i t y
LIABILITIES
Loans a n d borrowings
Trade and other payables
Deferred tax liabilities
c o n t r a c t l a b i l i t i e s
Total n o n - c u r r e n t liabilities
Loans and borrowings
Trade and other payables
Contract liabilities
To t a l c u r r e n t l i a b i l i t i e s
To t a l l i a b i l i t i e s
Total e q u i t y a n d liabilities
N o t e
13
1 4
15
17
18
18
18
2 6
3 1 D e c e m b e r
2 0 2 2
RUB'000
24,527,917
1,959,819
87,928
-
26,575,664
1,212,154
911,831
4,462,740
6,586,725
33,162,389
180,585
5,243,319
(655,352 )
21,982,033
26,750,585
212,677
26,963,262
19
21
20
19
21
489,200
729,173
-
468,505
1,686,878
106,426
2,822,399
1,583,424
4,512,249
6,199,127
33,162,389
3 1 D e c e m b e r
2 0 2 1
R U B 0 0 0
26,070,398
2,141,945
339,909
4,300
28,556,552
1,164,761
971,341
3,589,623
5,725,725
34,282,277
180,585
5,243,319
(655,352 )
18,064,135
22,832,687
264,505
23,097,192
3,726,707
624,808
6,234
460,420
4,818,169
1,786,326
3,010,232
1,570,358
6,366,916
11,185,085
34,282,277
On
3
1
March 2023 the Board o
f Directors o
f M
D Medical Group Investments P
i
c
approved and authorised these
consolidated
financial statements for issue.
vladimir e k l e r
Chairmanb f the Board of Directors
MarkKurtser
Managing Director
T h e N o t e so np a g e s1 9t o5 2a r ea nintegralp a r to ft h e s econsolidated financial s t a t e m e n t s .
MD MEDICAL GROUP INVESTMENTS PLC
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As a t 31 D e c e m b e r 2022
ASSETS
Property, plant and equipment
Intangible assets
Trade, other receivables and deferred expenses
D e f e r r e d t a x a s s e t s
To t a l n o n - c u r r e n t a s s e t s
I n v e n t o r i e s
Trade, other receivables and deferred expenses
c a s h and cash equivalents
Total current assets
To t a l a s s e t s
EQUITY
s h a r e c a p i t a l
Share premium
Reserves
Retained earnings
Total equity attributable to the owners of t h e Company
Non-controlling interests
To t a l e q u i t y
LIABILITIES
Loans a n d borrowings
Trade and other payables
Deferred tax liabilities
c o n t r a c t l a b i l i t i e s
Total n o n - c u r r e n t liabilities
Loans and borrowings
Trade and other payables
Contract liabilities
To t a l c u r r e n t l i a b i l i t i e s
To t a l l i a b i l i t i e s
Total e q u i t y a n d liabilities
N o t e
13
1 4
15
17
18
18
18
2 6
3 1 D e c e m b e r
2 0 2 2
RUB'000
(
19
21
20
19
21
3 1 D e c e m b e r
2 0 2 1
R U B 0 0 0
(
Chairmanb f the Board of Directors
MarkKurtser
Managing Director
T h e N o t e so np a g e s1 9t o5 2a r ea nintegralp a r to ft h e s econsolidated financial s t a t e m e n t s .
15
MD MEDICAL GROUP INVESTMENTS PLC
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 31 December 2022
Attributable to the owners of the Company Non-
Share Share Retained controlling Total
capital premium earnings Total interests equity
Note
RUB'000
RUB'000
RUB'000
RUB'000
RUB'000
RUB'000
RUB'000
Balance at 1 January 2022180,585
5,243,319
(655,352 )
18,064,135
22,832,687
264,505
23,097,192
-
-
-
4,560,217
4,560,217
158,583
4,718,800
12-
-
-
(642,319 )
(642,319 )
(210,411 )
(852,730 )
-
-
-
(642,319 )
(642,319 )
(210,411 )
(852,730 )
180,585
5,243,319
(655,352 )
21,982,033
26,750,585
212,677
26,963,262
Share premium is not available for distribution.
The Notes on pages 19 to 52 are an integral part of these consolidated financial statements.
Reserves
Profit and total comprehensive income for
the year
Contributions and distributions
Balance at 31 December 2022
Dividends declared
Total contributions and distributions
MD MEDICAL GROUP INVESTMENTS PLC
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 31 December 2022
Attributable to the owners of the Company Non-
Share Share Retained controlling Total
capital premium earnings Total interests equity
Note
RUB'000
RUB'000
RUB'000
RUB'000
RUB'000
RUB'000
RUB'000
Balance at 1 January 2022
12
Share premium is not available for distribution.
The Notes on pages 19 to 52 are an integral part of these consolidated financial statements.
Reserves
Profit and total comprehensive income for
the year
Contributions and distributions
Balance at 31 December 2022
Dividends declared
Total contributions and distributions
16
MD MEDICAL GROUP INVESTMENTS PLC
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 31 December 2021
Attributable to the owners of the Company Non-
Share Share Retained controlling Total
capital premium earnings Total interests equity
Note
RUB'000
RUB'000
RUB'000
RUB'000
RUB'000
RUB'000
RUB'000
Balance at 1 January 2021180,585
5,243,319
(655,352 )
14,840,273
19,608,825
343,756
19,952,581
-
-
-
6,003,486
6,003,486
139,540
6,143,026
12-
-
-
(2,779,624 )
(2,779,624 )
(219,222 )
(2,998,846 )
Other changes-
-
-
-
-
431
431
-
-
-
(2,779,624 )
(2,779,624 )
(218,791 )
(2,998,415 )
180,585
5,243,319
(655,352 )
18,064,135
22,832,687
264,505
23,097,192
Share premium is not available for distribution.
The Notes on pages 19 to 52 are an integral part of these consolidated financial statements.
Reserves
Balance at 31 December 2021
Profit and total comprehensive income for
the year
Contributions and distributions
Dividends declared
Total contributions and distributions
MD MEDICAL GROUP INVESTMENTS PLC
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 31 December 2021
Attributable to the owners of the Company Non-
Share Share Retained controlling Total
capital premium earnings Total interests equity
Note
RUB'000
RUB'000
RUB'000
RUB'000
RUB'000
RUB'000
RUB'000
Balance at 1 January 2021
12
Other changes
Share premium is not available for distribution.
The Notes on pages 19 to 52 are an integral part of these consolidated financial statements.
Reserves
Balance at 31 December 2021
Profit and total comprehensive income for
the year
Contributions and distributions
Dividends declared
Total contributions and distributions
17
MD MEDICAL GROUP INVESTMENTS PLC
CONSOLIDATED STATEMENT OF CASH FLOWS
For the year ended 31 December 2022
Note 2022 2021
RUB'000
RUB'000
Cash flows from operating activities
Profit for the year4,718,800
6,143,026
Adjustments for:
Depreciation 131,616,547
1,577,042
Amortisation 1451,109
122,176
Gain from the sale of property, plant and equipment (22,317 )
(2,162 )
Write-off of property, plant and equipment815
27,189
Impairment loss 13, 141,286,574
-
Finance income 9 (355,825 )
(93,683 )
Finance expenses (excluding impairment) 9400,207
517,714
Impairment of trade and other receivables 993,832
31,647
Net foreign exchange transactions loss 9104,751
8,017
Income tax expense 107,586
15,242
7,902,079
8,346,208
Increase in inventories (47,393 )
(190,884 )
Increase in trade and other receivables (35,292 )
(7,912 )
(Decrease) / increase in trade and other payables (55,420 )
276,341
(Decrease) / increase in contract liabilities (17,632 )
80,278
Cash flows from operations7,746,342
8,504,031
Tax paid (12,624 )
(4,635 )
Net cash flows from operating activities7,733,718
8,499,396
Cash flows from investing activities
Acquisition/construction of property, plant and equipment (1,098,983 )
(3,734,757 )
Proceeds from sale of property, plant and equipment62,796
2,724
Acquisition of intangible assets 14 (70,017 )
(55,466 )
Placing short-term bank deposits-
(866,831 )
Proceeds from short-term bank deposits return-
1,648,623
Bank interest received 9257,760
93,683
Net cash flows used in investing activities (848,444 )
(2,912,024 )
The Notes on pages 19 to 52 are an integral part of these consolidated financial statements.
MD MEDICAL GROUP INVESTMENTS PLC
CONSOLIDATED STATEMENT OF CASH FLOWS
For the year ended 31 December 2022
Note 2022 2021
RUB'000
RUB'000
Cash flows from operating activities
Profit for the year
Adjustments for:
Depreciation 13
Amortisation 14
Gain from the sale of property, plant and equipment (
Write-off of property, plant and equipment
Impairment loss 13, 14
Finance income 9 (
Finance expenses (excluding impairment) 9
Impairment of trade and other receivables 9
Net foreign exchange transactions loss 9
Income tax expense 10
Increase in inventories (
Increase in trade and other receivables (
(Decrease) / increase in trade and other payables (
(Decrease) / increase in contract liabilities (
Cash flows from operations
Tax paid (
Net cash flows from operating activities
Cash flows from investing activities
Acquisition/construction of property, plant and equipment (
Proceeds from sale of property, plant and equipment
Acquisition of intangible assets 14 (
Placing short-term bank deposits
Proceeds from short-term bank deposits return
Bank interest received 9
Net cash flows used in investing activities (
The Notes on pages 19 to 52 are an integral part of these consolidated financial statements.
18
MD MEDICAL GROUP INVESTMENTS PLC
CONSOLIDATED STATEMENT OF CASH FLOWS (continued)
For the year ended 31 December 2022
Note 2022 2021
RUB'000
RUB'000
Cash flows from financing activities
Repayment of loans and borrowings 19 (4,805,599 )
(1,490,806 )
Payments of lease liabilities 19 (150,743 )
(152,470 )
Finance expenses paid (262,088 )
(363,727 )
Proceeds from reimbursed VAT342,717
33,138
Repayment of reimbursed VAT (166,634 )
(152,123 )
Dividends paid to the owners of the Company (636,794 )
(2,726,685 )
Dividends paid to non-controlling interests (224,807 )
(178,177 )
Net cash flows used in financing activities (5,903,948 )
(5,030,850 )
Net increase in cash and cash equivalents981,326
556,522
Cash and cash equivalents as at the beginning of the year 163,589,623
3,128,718
Effect of movements in exchange rates on cash held (108,209 )
(95,617 )
Cash and cash equivalents as at the end of the year 164,462,740
3,589,623
The Notes on pages 19 to 52 are an integral part of these consolidated financial statements.
MD MEDICAL GROUP INVESTMENTS PLC
CONSOLIDATED STATEMENT OF CASH FLOWS (continued)
For the year ended 31 December 2022
Note 2022 2021
RUB'000
RUB'000
Cash flows from financing activities
Repayment of loans and borrowings 19 (
Payments of lease liabilities 19 (
Finance expenses paid (
Proceeds from reimbursed VAT
Repayment of reimbursed VAT (
Dividends paid to the owners of the Company (
Dividends paid to non-controlling interests (
Net cash flows used in financing activities (
Net increase in cash and cash equivalents
Cash and cash equivalents as at the beginning of the year 16
Effect of movements in exchange rates on cash held (
Cash and cash equivalents as at the end of the year 16
The Notes on pages 19 to 52 are an integral part of these consolidated financial statements.
19
1.
INCORPORATION AND PRINCIPAL ACTIVITIES
31 December 31 December
2022 2021
Effective Effective
holding holding
% %
JSC MD PROJECT 2000 Russian Federation Medical services 95 95
LLC Khaven Russian Federation Medical services 100 100
LLC Velum Russian Federation Medical services 90 90
LLC Capital Group Russian Federation Assistance services 95 95
LLC Clinic Mother and Child Russian Federation Holding of trademarks 100 100
LLC Clinica Zdorovia Russian Federation Medical services 80 80
LLC Ivamed Russian Federation Medical services 100 100
LLC Dilamed Russian Federation Medical services - 100
LLC Mother and Child Perm Russian Federation Medical services 95 95
LLC Mother and Child (Ufa) Russian Federation Dormant company 95 95
LLC Mother and Child Saint-Petersburg Russian Federation Medical services 85 85
LLC MD PROJECT 2010 Russian Federation Medical services 100 100
LLC Mother and Child Ugo-Zapad Russian Federation Medical services 90 90
LLC MD Service Russian Federation Pharmaceutics retail 95 95
LLC Mother and Child Nizhny Novgorod Russian Federation Medical services 100 100
LLC Mother and Child Yekaterinburg Russian Federation Medical services 100 100
LLC Mother and Child Tyumen Russian Federation Medical services 100 100
JSC MK IDK Russian Federation Medical services 100 100
LLC Apteka IDK Russian Federation Pharmaceutics retail 100 100
LLC CSR Russian Federation Dormant company 100 100
LLC MD Assistance Russian Federation Assistance services 100 100
LLC Mother and Child Yaroslavl Russian Federation Medical services 80 80
LLC Mother and Child Kostroma Russian Federation Medical services 80 80
LLC Mother and Child Vladimir Russian Federation Medical services 80 80
LLC Mother and Child Ryazan Russian Federation Medical services 100 100
LLC Mother and Child Kazan Russian Federation Medical services 100 100
JSC MC Avicenna Russian Federation Medical services 100 100
LLC H&C Medical Group Russian Federation Pharmaceutics retail 100 100
LLC Centre of Reproductive Medicine Russian Federation Medical services 100 100
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
Name Activities
MD Medical Group Investments Pl c (the “Company”)
was incorporated in
Cyprus on 5 August 2010 as a private
limited
liability
company.
In August 2012, following the special resolution passed by the shareholder, the
Company was converted into a
public limited liability company . Its Registered Office is at Dimitriou Karatasou 15, Anastasio Building, 6th floor, office 601, Strovolos, 2024, Nicosia, Cyprus.
The principal activity of the Company is that of an investment holding company and, for that purpose, to acquire
and hold controlling and other interests in the share or loan capital of any company or companies of any nature
(the Company and its subsidiaries together referred to as the “Group”), but primarily in the healthcare industry.
Refer to Note 4 for more detailed information about the services provided by the Group’s medical centres.
The details of the directly and indirectly owned subsidiaries are as follows:
Country of
incorporation
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
20
1. INCORPORATION AND PRINCIPAL ACTIVITIES (continued)
31 December 31 December
2022 2021
Effective Effective
holding, % holding, %
LLC Medica-2 Russian Federation Medical services 100 100
Russian Federation Medical services 100 100
Russian Federation Medical services 100 100
Russian Federation Medical services 100 100
Russian Federation Medical services 100 100
LLC Mother and Child Vladivostok Russian Federation Medical services 100 100
LLC Mother and Child Volga Russian Federation Management company 100 100
LLC MD Finance Russian Federation Management company 100 100
LLC Mother and Child Krasnodar Russian Federation Medical services 100 100
LLC Mother and Child Rostov-on-Don Russian Federation Medical services 100 100
LLC MD Group Krasnogorsk Russian Federation Dormant 90 90
LLC MD Belgorod Russian Federation Medical services - 100
LLC MD Lipetsk Russian Federation Medical services - 100
NFP MGIMO-MED Russian Federation Medical university 67 67
LLC MD Group Holding Russian Federation Management company 100 -
JSC MD Medical Group Russian Federation Management company 100 -
LLC Siberia service company Russian Federation Service company - -
LLC TechMedCom Russian Federation Service company - -
LLC Service Hospital Company Russian Federation Service company - -
LLC Elleprof Russian Federation Service company - -
LLC Medtechnoservice Russian Federation Service company - -
2.
BASIS OF PREPARATION
(
a) Statement of compliance (b) Basis of measurement
These consolidated financial statements have been prepared in accordance with International Financial Reporting
Standards as adopted by the European Union (IFRS-EU).
LLC Barnaulskii center of
Reproductive Medicine
LLC Krasnoyarskii center of
Reproductive Medicine
LLC Novosibirskii center of
Reproductive Medicine
LLC Omskii center of Reproductive
Medicine
As at 31 December 2022, 67.9% of the Company’s share capital is owned by
MD Medical Holding Limited , a company beneficially owned by Dr. Mark Kurtse r . The 32.1% of the Company’s share capital is owned by
Guarantee Nominee Limited, which holds the shares on behalf of the GDR holders.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Name Activities
Country of
incorporation
These consolidated financial statements have been prepared under the historical cost convention.
These consolidated financial statements were approved by the Board of Directors and were authorised for issue
on 31 March 2023.
These consolidated financial statements of the Group are presented in RUB, all amounts have been rounded to
the nearest thousand, unless otherwise indicated.
All of the operational Group entities are located in the Russian Federation
. The Company and all its operating subsidiaries have RUB as their functional currency.
(c) Functional and presentation currency
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
21
2.BASIS OF PREPARATION (continued)
• Impairment of intangible assets and property, plant and equipment
3.
SIGNIFICANT ACCOUNTING POLICIES
MD MEDICAL GROUP INVESTMENTS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
The estimates and underlying assumptions are reviewed and where necessary revised on an ongoing basis.
Revisions to estimates are recognised prospectively.
In particular, information about significant areas of estimation, uncertainty and critical judgments in applying
accounting policies that have the most significant effect on the amount recognised in the consolidated financial
statements are described below:
The estimates and underlying assumptions are based on historical experience and various other factors that are
deemed reasonable based on knowledge available at that time. Actual results may differ from these estimates.
(d) Use of estimates and judgements
Preparing these consolidated financial statements in accordance with IFRSs requires management to exercise
their judgement to make estimates and assumptions that affect the application of accounting policies and the
reported amounts of assets and liabilities, income and expenses.
The accounting policies applied in these consolidated financial statements are consistent with those followed in
the Group’s consolidated financial statements as at 31 December 2021 and for the year then ended.
New standards and amendments applied for the first time in 2022 did not impact these consolidated financial
statements of the Group.
• Other
Intangible assets and property, plant and equipment are initially recorded at acquisition cost and are amortised
on a straight line basis over their useful economic life. Intangible assets and property, plant and equipment that
are acquired through a business combination are initially recorded at fair value at the date of acquisition.
Intangible assets with indefinite useful life are reviewed for impairment at least annually.
The impairment test is performed using the discounted cash flows expected to be generated through the use of
the intangible assets and property, plant and equipment, using a discount rate that reflects the current market
estimations and the risks associated with the asset. When it is impractical to estimate the recoverable amount of
an asset, the Group estimates the recoverable amount of the cash generating unit to which the asset belongs.
• Impairment of goodwill
Determining whether goodwill is impaired requires an estimation of the value in use of the cash generating units
of the Group to which the goodwill has been allocated.
Information about judgements, assumptions and estimation uncertainties regarding revenue recognition,
deferred taxes assets, provisions, leases and ECL allowance for trade receivables and contract assets as at
31 December 2022 is described in Note 3.
The significant judgements made by the management in applying the Group accounting policies and the key
sources of estimation uncertainty were the same as those applied to the consolidated financial statements for the
year ended 31 December 2021 except for those reflected in Notes 13, 14.
2.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
22
3.
SIGNIFICANT ACCOUNTING POLICIES (continued)
Business combinations arising from transfers of interests in entities that are under the control of the shareholder
that controls the Group are accounted for as if the acquisition had occurred at the beginning of the earliest
comparative period presented or, if later, at the date that common control was established or, if later, at the
date the Company was incorporated. The assets and liabilities acquired are recognised at their book values. Any
difference between the consideration paid and the book values is recognised directly in equity.
Any contingent consideration is measured at fair value at the date of acquisition. If an obligation to pay
contingent consideration that meets the definition of a financial instrument is classified as equity, then it is not
remeasured and settlement is accounted for within equity. Otherwise, other contingent consideration is
remeasured at fair value at each reporting date and subsequent changes in the fair value of the contingent
consideration are recognised in profit or loss. Acquisitions from entities under common control
The financial statements of all the Group companies are prepared using uniform accounting policies.
Business combinations
Acquisitions of businesses are accounted for using the acquisition method when control is transferred to the
Group. The consideration transferred in the acquisition is generally measured at fair value, as are the identifiable
net assets acquired. Any goodwill that arises is tested annually for impairment. Any gain on a bargain purchase is
recognised in profit or loss immediately. Transaction costs are expensed as incurred, except if related to the issue
of debt or equity securities.
The consideration transferred does not include amounts related to the settlement of pre-existing relationships.
Such amounts are generally recognised in profit or loss.
Intra-group balances and transactions and any unrealised income and expenses arising from intra-group
transactions are eliminated. Unrealised losses are eliminated in the same way as unrealised gains, but only to the
extent that there is no evidence of impairment.
Transactions eliminated on consolidation
Non-controlling interests
Non-controlling interests are measured at their proportionate share of the acquirer’s identifiable net assets at the
date of acquisition.
Changes in the Group’s interest in a subsidiary that do not result in a loss of control are accounted for as equity
transactions. Loss of control
When the Group losses control over a subsidiary, it derecognises the assets and liabilities of the subsidiary, and
any related non-controlling interest and other components of equity. Any resulting gain or loss is recognised in
profit or loss. Any interest retained in the former subsidiary is measured at fair value when control is lost.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
These consolidated financial statements incorporate the financial statements of the Company and entities
controlled by the Company (its subsidiaries). The Group 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 affect those returns through its power
over the entity. The financial statements of subsidiaries are included in the consolidated financial statements
from the date on which control commences until the date on which control ceases.
Basis of consolidation
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
23
3.
SIGNIFICANT ACCOUNTING POLICIES (continued)
Finance income includes:
Finance income
Finance expenses include interest expense and other borrowing costs and are recognised in profit or loss 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:
Finance expenses
•
income from initial recognition of other payables to tax authorities at a market interest rate.
•
interest income which is recognised as it accrues in profit or loss using the effective interest method;
• the amortised cost of the financial liability.
•
the gross carrying amount of the financial asset; or
In calculating interest income and expense, the effective interest rate is applied to the gross carrying amount of
the asset (when the asset is not credit-impaired) or to the amortised cost of the liability. However, for financial
assets that have become credit-impaired subsequent to initial recognition, interest income is calculated by
applying the effective interest rate to the amortised cost of the financial asset. If the asset is no longer credit-
impaired, then the calculation of interest income reverts to the gross basis.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
Rendering of services (long-term
contracts)
Long-term contracts for offering medical services that last from 1 to 5 years with
performance obligations satisfied via passage of time. Payments from legal entities
are usually fully prepaid. Revenue is accrued monthly during the whole period of
contract.
Storage of stem cells
Nature of service is long-term safekeeping of biological materials comprising stem
cells concentrate. Standard terms of contract include predetermined period of
contract from 1 to 30 years paid in advance by the customer in full amount.
Revenue from contract consists of two parts – revenue from blood collection and
stem cells isolation (charged and recognised at the moment of the appropriate
services rendered) and revenue from storage of stem cells. Revenue from storage
is accrued monthly during the whole period of contract.
Sales of services are recognised at point in time in which the services are rendered
by reference to completion of the actual service provided. Payments from patients
for agreements are usually fully prepaid, one-off services are paid right after the
service is rendered. Mandatory Health Insurance (MHI), insurance and other
companies usually pay in up to two months after the services are provided.
Revenue
The Group has two main types of revenue: rendering of services and sales of goods.
Revenue is recognised in the moment when the service is provided to the customer. Determining the timing of
the services rendering – at a point in time or over time – requires judgement. The details are described below.
Type of product/service
Rendering of services (except storage of
stem cells and long term contracts
described below)
Nature, timing of satisfaction of performance obligations, significant
payment terms
Sales of goods are recognised when control over the goods has been transferred
to the customer, which is usually when the Group has sold or delivered goods to
the customer, the customer has accepted the goods and collectability of the
related receivable is reasonably assured. The payments are usually made at the
moment of sale.
Sales of goods
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
24
3.
SIGNIFICANT ACCOUNTING POLICIES (continued)
Dividend distribution to the Company's shareholders is recognised in the Group's financial statements when the
shareholders’ right to receive the dividends is established, either through Board resolution (for interim dividends)
or by the Group’s shareholders in the Annual General Meeting (for final dividends).
Dividends declared
Government grants
Government grants are recognised where there is reasonable assurance that the grant will be received and all
attached conditions will be complied with. When the grant relates to an expense item, it is deducted in reporting
from the related expense. When the grant relates to an asset, it reduces the carrying amount of the asset. The
grant is then recognised in profit or loss over the useful life of the depreciable asset by way of a reduced
depreciation charge.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets
against current tax liabilities and when they relate to income taxes levied by the same taxation authority and the
Group intends to settle its current tax assets and liabilities on a net basis.
Deferred tax liabilities are recognised for taxable temporary differences arising on investments in subsidiaries and
associates, and interests in joint ventures, except where the Group is able to control the reversal of the
temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future.
Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or
the asset realised. Deferred tax is charged or credited to profit or loss, except when it relates to items charged or
credited directly to other comprehensive income or equity, in which case the deferred tax is also dealt with in
other comprehensive income or equity.
The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it
is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be
recovered.
The tax currently payable is based on taxable profit for the year. Taxable profit differs from profit as reported in
profit or loss because it excludes items of income or expense that are taxable or deductible in other years and it
further excludes items that are never taxable or deductible. The Group's liability for current tax is calculated
using tax rates that have been enacted or substantively enacted at the reporting date.
Foreign currency translation
Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at
the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such
transactions and from the translation at year end exchange rates of monetary assets and liabilities denominated
in foreign currencies are recognised in profit or loss.
Tax
Deferred tax is recognised on differences between the carrying amounts of assets and liabilities in the financial
statements and the corresponding tax bases used in the computation of taxable profit, and is accounted for using
the statement of financial position method. Deferred tax liabilities are generally recognised for all taxable
temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits
will be available against which deductible temporary differences can be utilised. Such assets and liabilities are not
recognised if the temporary difference arises from goodwill or from the initial recognition (other than in a
business combination) of other assets and liabilities in a transaction that affects neither the taxable profit nor the
accounting profit.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
25
3.
SIGNIFICANT ACCOUNTING POLICIES (continued)
Freehold buildings
Leasehold improvements
Plant and equipment
(ii)
Patents and trademarks
Patents and trademarks are measured initially at purchase cost and are amortised on a straight line basis over
their estimated useful lives. Their estimated useful life is from five to seven years.
No depreciation is provided on land.
Assets under construction are not depreciated until they are completed and available for use. At that moment
they are reclassified in the relevant class of property, plant and equipment and depreciated accordingly.
Expenditure for repairs and maintenance of property, plant and equipment is charged to profit or loss for the
year in which it is incurred. The cost of major renovations and other subsequent expenditure is included in the
carrying amount of the asset when it is probable that future economic benefits in excess of the originally
assessed standard of performance of the existing asset will flow to the Group. Major renovations are depreciated
over the remaining useful life of the related asset.
Property, plant and equipment
50
Years
5-10
10-20
Goodwill represents the difference between the cost of an acquisition and the fair value of the Group's share of
the net identifiable assets of the acquired undertaking at the date of acquisition. Positive goodwill on acquisition
of subsidiaries is included in intangible assets.
Depreciation methods, useful lives and residual values are reassessed at the reporting date.
Where the carrying amount of an asset is greater than its estimated recoverable amount, the asset is impaired
immediately to its recoverable amount.
An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are
expected to arise from the continued use of the asset. Any gain or loss arising on the disposal or retirement of an
item of property, plant and equipment is determined as the difference between the sales proceeds and the
carrying amount of the asset and is recognised in profit or loss.
Intangible assets
(i) Goodwill
The excess of the Group’s interest in the fair value of the new subsidiaries’ net assets over the consideration paid
for their acquisition (a bargain purchase gain) is recognised in profit or loss in the year of acquisition of the
relevant subsidiary. Positive goodwill is tested annually for impairment and is carried at cost less accumulated
impairment losses. Gains and losses on the disposal of an undertaking include the carrying amount of goodwill
relating to the undertaking sold. For the purpose of impairment testing goodwill is allocated to cash generating
units that are expected to benefit from the synergies of the combinations.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
Properties in the course of construction for production, rental or administrative purposes, or for purposes not yet
determined, are carried at cost, less any recognised impairment loss. Cost includes professional fees and, for
qualifying assets, borrowing costs capitalised in accordance with the Group's accounting policy. Depreciation of
these assets, on the same basis as other property assets, commences when the assets are ready for their
intended use.
Depreciation is recognised in profit or loss on the straight line method over the useful lives of each part of an
item of property, plant and equipment. The annual depreciation rates for the current and comparative periods
are based on the following estimations of useful lives:
Property, plant and equipment are measured at cost less accumulated depreciation and impairment losses.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
26
3.
SIGNIFICANT ACCOUNTING POLICIES (continued)
(iii) Software and web site costs
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
Intangible assets (continued)
The Group’s financial assets comprise of trade and other receivables, as well as cash and cash equivalents. All of
the Group financial assets are measured at amortised cost. They are classified as current assets unless the Group
has an unconditional responsibility to accept deferral of receipt for at least twelve months after the balance sheet
date, in which case they are classified as non-current assets.
T
he Group classifies financial assets on the basis of both: the Group`s business model for managing financial assets, as well as the contractual cash flow characteristics of the financial assets.
Classification
The Group recognises financial assets and financial liabilities when, and only when, it becomes a party of the
contractual provisions of the financial instrument. Trade receivables and debt securities issued are initially
recognised when they are originated.
A financial 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 flows; and
– its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest
on the principal amount outstanding.
Recognition
Provisions
Provisions are recognised when the Group has a present legal or constructive obligation as a result of past
events, it is probable that an outflow of resources will be required to settle the obligation, and a reliable estimate
of the amount can be made. Where the Group expects a provision to be reimbursed, for example under an
insurance contract, the reimbursement is recognised as a separate asset but only when the reimbursement is
virtually certain.
Financial instruments
Inventories
Inventories include medicines and medical material and are stated at the lower of cost and net realisable value.
The cost is determined using the weighted average method. Net realisable value is the estimated selling price in
the ordinary course of business, less the costs to completion and selling expenses.
External costs that are directly associated with web site controlled by the Group and that will probably generate
economic benefits exceeding costs beyond one year are recognised as intangible assets. Subsequently web site
costs are carried at cost less any accumulated amortisation and any accumulated impairment losses. Web site
costs are amortised using the straight line method over their useful lives, not exceeding a period of five years.
Amortisation commences when the site is available for use and is included within administrative expenses.
An intangible asset is derecognised on disposal, or when no future economic benefits are expected from use.
Gains or losses arising from derecognition of an intangible asset, measured as the difference between the net
disposal proceeds and the carrying amount of the asset, are recognised in profit or loss when the asset is
derecognised.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
27
3.
SIGNIFICANT ACCOUNTING POLICIES (continued)
Initial measurement
Financial assets – Business model assessment
The Group makes an assessment of the objective of the business model in which a financial asset is held at a
portfolio level because this best reflects the way the business is managed and information is provided to
management. The information considered includes:
Financial instruments (continued)
A prepayment feature is consistent with the solely payments of principal and interest criterion if the prepayment
amount substantially represents unpaid amounts of principal and interest on the principal amount outstanding,
which may include reasonable compensation for early termination of the contract. Additionally, for a financial
asset acquired at a discount or premium to its contractual par amount, a feature that permits or requires
prepayment at an amount that substantially represents the contractual par amount plus accrued (but unpaid)
contractual interest (which may also include reasonable compensation for early termination) is treated as
consistent with this criterion if the fair value of the prepayment feature is insignificant at initial recognition.
The Group’s financial liabilities comprise of trade and other payables and borrowings. They are classified as
current liabilities unless there is an unconditional right to defer settlement for at least twelve months after the
balance sheet date, in which case they are classified as long-term liabilities.
– terms that limit the Group’s claim to cash flows from specified assets (e.g. non‑recourse features).
In assessing whether the contractual cash flows are solely payments of principal and interest, the Group
considers the contractual terms of the instrument. This includes assessing whether the financial asset contains a
contractual term that could change the timing or amount of contractual cash flows such that it would not meet
this condition. In making this assessment, the Group considers:
– contingent events that would change the amount or timing of cash flows;
– terms that may adjust the contractual coupon rate, including variable‑rate features;
– prepayment and extension features; and
Transfers of financial assets to third parties in transactions that do not qualify for derecognition are not
considered sales for this purpose, consistent with the Group’s continuing recognition of the assets. Financial assets – Assessment whether contractual cash flows are solely payments of principal and interest
For the purposes of this assessment, ‘principal’ is defined as the fair value of the financial asset on initial
recognition. ‘Interest’ is defined 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 profit margin.
– the stated policies and objectives for the portfolio and the operation of those policies in practice. These include
whether management’s strategy focuses on earning contractual interest income, maintaining a particular interest
rate profile, matching the duration of the financial assets to the duration of any related liabilities or expected
cash outflows or realising cash flows through the sale of the assets;
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
– how the performance of the portfolio is evaluated and reported to the Group’s management;
– the risks that affect the performance of the business model (and the financial assets held within that business
model) and how those risks are managed;
– how managers of the business are compensated – e.g. whether compensation is based on the fair value of the
assets managed or the contractual cash flows collected; and
– the frequency, volume and timing of sales of financial assets in prior periods, the reasons for such sales and
expectations about future sales activity.
Financial assets and financial liabilities are initially measured at fair value plus or minus correspondingly of any
directly attributable transaction costs.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
28
MD MEDICAL GROUP INVESTMENTS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
3.
SIGNIFICANT ACCOUNTING POLICIES (continued)
When determining whether the credit risk of a financial asset has increased significantly since initial recognition
and when estimating ECLs, the Group considers reasonable and supportable information that is relevant and
available without undue cost or effort. This includes both quantitative and qualitative information and analysis,
based on the Group’s historical experience and informed credit assessment, that includes forward‑looking
information.
Trade and other receivables are amounts due from customers for services performed in the ordinary course of
business and are stated after deducting the appropriate allowances for any impairment.
For the purpose of the statement of cash flows, cash and cash equivalents include cash in hand, cash at bank
and short-term highly liquid investments with maturity of three months or less from the acquisition date that are
subject to an insignificant risk of changes in their fair value and are used by the Group in the management of its
short term investments.
I
mpairment of non-derivative financial assets At each balance sheet date the Group recognises a loss allowance for expected credit losses on financial assets
measured at amortised cost.
Evidence that a financial asset is credit‑impaired includes the following observable data:
– significant financial difficulty of the debtor;
– it is probable that the debtor will enter bankruptcy or other financial reorganisation; or
– the disappearance of an active market for a security because of financial difficulties.
At each reporting date, the Group assesses whether financial assets carried at amortised cost are
credit‑impaired. A financial asset is ‘credit‑impaired’ when one or more events that have a detrimental impact on
the estimated future cash flows of the financial asset have occurred.
The Group assumes that the credit risk on a financial asset has increased significantly if it is more than 90 days
past due.
The Group considers a financial asset to be in default when the debtor is unlikely to pay its credit obligations to
the Group in full, without recourse by the Group to actions such as realising security (if any is held). Credit-impaired financial assets
Financial instruments (continued)
Individually significant financial assets are tested for impairment on an individual basis. The remaining financial
assets are assessed collectively in groups that share similar credit risk characteristics. The Group measures loss
allowances at an amount equal to lifetime ECLs.
The loss allowance for financial assets at amortised cost is recognised in profit or loss in respondence with a
balance sheet account reducing the carrying amount of the financial asset. Expected credit losses for
counterparties, including banks, are determined based on historical data of relevant probability of default and
loss given default. Impairment on cash and cash equivalents is measured on a 12‑month expected loss basis and
reflects the short maturities of the exposures. The Group considers that its cash and cash equivalents have low
credit risk based on the external credit ratings of the counterparties.
Financial assets at amortised cost:
These assets are subsequently measured at amortised cost using the effective interest method.
The amortised cost is reduced by impairment losses.
Interest income, foreign exchange gain and losses and impairment are recognised in profit or loss. Any gain or loss on derecognition is recognised in profit or loss.
Financial liabilities at amortised cost:
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.
Subsequent Measurement
MD MEDICAL GROUP INVESTMENTS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
29
MD MEDICAL GROUP INVESTMENTS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
3.
SIGNIFICANT ACCOUNTING POLICIES (continued)
When an existing financial liability is replaced by another from the same lender on substantially different terms,
or the terms of an existing liability are substantially modified, such an exchange or modification is treated as a
derecognition of the original liability and the recognition of a new liability, and the difference in the respective
carrying amounts is recognised in profit or loss.
Changes in cash flows on existing financial liabilities are not considered as modification, if they result from
existing contractual terms, e.g. changes in fixed interest rates initiated by banks due to changes in the CBR key
rate, if the loan contract entitles banks to do so and the Group have an option to either accept the revised rate or
redeem the loan at par without penalty. The Group treats the modification of an interest rate to a current market
rate using the guidance on floating-rate financial instruments. This means that the effective interest rate is
adjusted prospectively. Offsetting financial instruments
Financial assets and financial liabilities are offset and the net amount reported in the consolidated statement of
financial position if, and only if, there is a currently enforceable legal right to offset the recognised amounts and
there is an intention to settle on a net basis, or to realise the asset and settle the liability simultaneously. This is
not generally the case with master netting agreements, and the related assets and liabilities are presented gross
in the consolidated statement of financial position.
Financial instruments (continued) Write-off
The gross carrying amount of a financial asset is written off when the Group has no reasonable expectations of
recovering a financial asset in its entirety or a portion thereof. For individual customers, the Group has a policy of
writing off the gross carrying amount when the financial asset is 3 years without movements past due based on
Russian legislation. For corporate customers, the Group individually makes an assessment with respect to the
timing and amount of write‑off based on whether there is a reasonable expectation of recovery. The Group
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 the Group’s procedures for recovery of amounts
due.
An impairment loss is reversed if the reversal can be related objectively to an event occurring after the
impairment loss was recognised. For financial assets measured at amortised cost the reversal is recognised in
profit or loss.
• the rights to receive cash flows from the asset have expired;
• the Group retains the right to receive cash flows from the asset, but has assumed an obligation to pay them
in full without material delay to a third party under a “pass through” arrangement; or
Derecognition of financial assets
A financial asset (or, where applicable a part of a financial asset or part of a group of similar financial assets) is
derecognised when:
• the Group has transferred its rights to receive cash flows from the asset and either (a) has transferred
substantially all the risks and rewards of the asset, or (b) has neither transferred nor retained substantially all the
risks and rewards of the asset, but has transferred control of the asset.
Any interest in such derecognised financial assets that is created or retained by the Group, is recognised as a
separate asset or liability. Derecognition of financial liabilities
A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires.
MD MEDICAL GROUP INVESTMENTS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
30
MD MEDICAL GROUP INVESTMENTS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
3.
SIGNIFICANT ACCOUNTING POLICIES (continued)
The lease liability is initially measured at the present value of the lease payments that are not paid at the
commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily
determined, the Group's incremental borrowing rate. Generally, the Group uses its incremental borrowing rate as
the discount rate.
Proceeds from the issue of ordinary shares are classified as equity. The difference between the issue price of the
shares and their nominal value is taken to the share premium account.
Share capital
Assets that have an indefinite useful life are not subject to amortisation and are tested annually for impairment.
Assets that are subject to depreciation or amortisation are reviewed for impairment whenever events or changes
in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for
the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the
higher of an asset's fair value less costs to sell and value in use. For the purposes of assessing impairment,
assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash generating
units).
Impairment of non-financial assets
Incremental costs directly attributable to the issue of new shares are recognised as a deduction from share
premium net of any tax effect.
The Group 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, which comprises the initial amount of the lease liability adjusted for any lease
payments made at or before the commencement date, plus any initial direct costs incurred and an estimate of
costs to dismantle and remove the underlying asset or to restore the underlying asset or the site on which it is
located, less any lease incentives received.
Capitalised interest
At inception of a contract, the Group 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.
Interest expense on borrowed funds used for capital construction projects and the acquisition of property, plant
and equipment is capitalised provided that the interest expense could have been avoided if the Group had not
made capital investments. Interest is capitalised only during the period when construction activities are actually
in progress and until the resulting properties are put into operation.
Leases
Earnings per share
Leases in which the Group is a lessee
At commencement or on modification of a contract that contains a lease component, the Group allocates the
consideration in the contract to each lease component on the basis of its relative stand‑alone prices. However,
for the leases of property the Group has elected not to separate non‑lease components and account for the lease
and non‑lease components as a single lease component.
The Group presents earnings per share
(“EPS”)
data for its ordinary shares. EPS is calculated by dividing the
profit or loss attributable to the owners of the Company by the weighted average number of ordinary shares in
issue during the period, adjusted for own shares held.
The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date
to the end of the lease term, unless the lease transfers ownership of the underlying asset to the Group by the
end of the lease term or the cost of the right-of-use asset reflects that the Group will exercise a purchase option.
In that case, the right-of-use asset will be depreciated over the useful life of the underlying asset, which is
determined on the same basis as those of property and equipment. In addition, the right-of-use asset is
periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability.
MD MEDICAL GROUP INVESTMENTS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
31
MD MEDICAL GROUP INVESTMENTS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
3.
SIGNIFICANT ACCOUNTING POLICIES (continued)
Short-term leases and leases of low-value assets
The Group has elected not to recognise right-of-use assets and lease liabilities for leases of low-value assets and
short-term leases, including IT equipment. The Group recognises the lease payments associated with these
leases as an expense on a straight-line basis over the lease term. COVID-19-related rent concessions
The Group has applied COVID-19-Related Rent Concessions - Amendment to IFRS 16. The Group applies the
practical expedient allowing it not to assess whether eligible rent concessions that are a direct consequence of
the COVID-19 pandemic are lease modifications. The Group applies the practical expedient consistently to
contracts with similar characteristics and in similar circumstances. For rent concessions in leases to which the
Group chooses not to apply the practical expedient, or that do not qualify for the practical expedient, the Group
assesses whether there is a lease modification. Leases in which the Group is a lessor
The Group does not have significant contracts where it is a lessor.
The Group determines its incremental borrowing rate by obtaining interest rates from various external financing
sources and makes certain adjustments to reflect the terms of the lease and type of the asset leased.
Leases (continued)
The Group presents right‑of‑use assets that do not meet the definition of investment property in ‘property, plant
and equipment’ and lease liabilities in ‘loans and borrowings’ in the consolidated statement of financial position.
When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of
the right‑of‑use asset, or is recorded in profit or loss if the carrying amount of the right‑of‑use asset has been
reduced to zero.
Leases in which the Group is a lessee (continued)
The lease liability is measured at amortised cost using the effective interest method. It is remeasured when there
is a change in future lease payments arising from a change in an index or rate, if there is a change in the Group’s
estimate of the amount expected to be payable under a residual value guarantee, if the Group changes its
assessment of whether it will exercise a purchase, extension or termination option or if there is a revised
in‑substance fixed lease payment.
– amounts expected to be payable under a residual value guarantee; and
– the exercise price under a purchase option that the Group is reasonably certain to exercise, lease payments in
an optional renewal period if the Group is reasonably certain to exercise an extension option, and penalties for
early termination of a lease unless the Group is reasonably certain not to terminate early.
Lease payments included in the measurement of the lease liability comprise the following:
– fixed payments, including in‑substance fixed payments;
– variable lease payments that depend on an index or a rate, initially measured using the index or rate as at the
commencement date;
MD MEDICAL GROUP INVESTMENTS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
32
MD MEDICAL GROUP INVESTMENTS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
3.
SIGNIFICANT ACCOUNTING POLICIES (continued)
4.
REVENUE
2022
2021
RUB'000
RUB'000
Therapy, surgery and other in-patient medical services
4,643,136
5,486,629
In vitro fertilisation (IVF)
4,331,930
3,939,363
Deliveries
2,843,344
2,863,685
Oncology
2,480,842
2,131,922
Obstetrics and gynaecology out-patient treatments
2,399,259
2,217,946
Diagnostic centre and other out-patient medical services
2,321,624
2,180,239
Laboratory examinations and other medical services
1,983,791
2,493,346
Paediatrics out-patient treatments
1,637,982
1,588,170
Obstetrics and gynaecology in-patient treatments
1,224,345
1,031,978
Paediatrics in-patient treatments
714,102
676,330
Sales of goods
280,706
251,654
Storage of stem cells
170,442
162,643
Other income
190,553
195,778
Total revenue from contracts with customers
25,222,056
25,219,683
Disaggregation of revenue
The Group renders the services on the territory of the Russian Federation. The Group’s
operations and main
revenue streams are those described in the table above.
The majority of the Group's customers are physical persons (76% of total revenue); some services are rendered
through the governmental and non-governmental insurance companies and legal entities. All the contracts are
fixed-price and short-term except for the contracts for the storage of stem cells and the contract for offering
medical services to a significant corporate client, such contracts are fully prepaid.
All the Group's revenue except for the revenue from the storage of stem cells and long-term contracts is
recognised at the point of time when the services are provided; the revenue from the storage of stem cells and
long-term contracts is recognised over the time of the contract.
The following new and amended standards are not expected to have a significant impact on the Group’s
consolidated financial statements.
Standards issued but not yet effective:
– IFRS 17 Insurance Contracts and amendments to IFRS 17 Insurance Contracts;
– Deferred Tax related to Assets and Liabilities arising from a Single Transaction (Amendments to IAS 12);
– Definition of Accounting Estimates (Amendments to IAS 8).
– Disclosure of Accounting Policies (Amendments to IAS 1 and IFRS Practice Statement 2);
The contract liabilities primarily relate to the advance consideration received from patients. The amount of
RUB808,532 thousand was recognised in short-term contract liabilities at the beginning of the year was
recognised as revenue during the year ended 31 December 2022 (31 December 2021: RUB717,705 thousand).
The amount of RUB60,529 thousand returned to the patients and the amount of RUB197,295 thousand was
transferred to the other contracts during the year ended 31 December 2022 (31 December 2021: RUB67,932
thousand and RUB271,001 thousand respectively).
MD MEDICAL GROUP INVESTMENTS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
33
MD MEDICAL GROUP INVESTMENTS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
5. COST OF SALES
2022 2021
RUB'000
RUB'000
Payroll and related social taxes 8,104,750 7,517,576
Materials and supplies used 5,031,519 5,477,791
Depreciation 1,402,538 1,367,565
Medical services 308,087 334,712
Energy and utilities 282,059 269,316
Property tax 176,071 148,058
Repair and maintenance 96,973 88,513
Other expenses 26,620 28,244
Total cost of sales 15,428,617 15,231,775
6. SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
2022 2021
RUB'000
RUB'000
Payroll and related social taxes 2,036,089 2,022,217
Utilities and materials 305,540 270,838
Depreciation 214,009 209,477
Advertising 211,196 161,968
Other professional services 174,443 134,770
Acquiring and encashment 159,461 172,536
Commission fees 118,270 90,232
IT support 77,933 20,913
Amortisation 51,109 122,176
Communication costs 45,631 39,630
Independent auditors' remuneration 19,924 22,964
Learning and development 17,582 23,433
Other expenses 81,958 111,208
Total selling, general and administrative expenses 3,513,145 3,402,362
7. STAFF COSTS
2022 2021
RUB'000
RUB'000
Wages and salaries 8,050,193 7,592,490
Social insurance contributions and other taxes 2,090,646 1,947,303
Total staff costs 10,140,839 9,539,793
During the year ended 31 December 2022 the Group did not receive any government grants to cover the
additional payroll costs paid to doctors and other medical staff as a result of COVID-19 (for the year ended
The number of employees as at 31 December 2022 was 8,466 (31 December 2021: 8,461).
31 December 2021: RUB4,526 thousand, which reduced the staff costs accordingly).
MD MEDICAL GROUP INVESTMENTS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
34
MD MEDICAL GROUP INVESTMENTS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
8. OTHER INCOME AND EXPENSES
9. NET FINANCE EXPENSES
Note 2022 2021
RUB'000
RUB'000
Finance income
Bank interest received 257,760 93,683
Initial recognition of other payables to tax authorities at market rate 98,065 -
Finance income 355,825 93,683
Finance expenses
Interest on bank loans (228,607) (339,240)
Unwinding of discount on other payables to tax authorities (60,177) (63,950)
Interest on leases (51,881) (49,033)
Other interest expenses (38,783) (41,259)
Other finance expenses
Impairment of trade and other receivables 15 (93,832) (31,647)
Bank charges (20,759) (23,650)
Other impairment provision - (582)
Finance expenses (494,039) (549,361)
Net foreign exchange transactions loss (104,751) (8,017)
Net finance expenses (242,965) (463,695)
During the year ended 31 December 2022 the Group received other income of RUB36,141 thousand, including
income from fixed assets sale amounted to RUB21,103 thousand. (During the year ended 31 December 2021 the
Group received other income of RUB104,424 thousand, including a property tax refund amounted to RUB44,966
thousand by MD Project 2010).
The Group incurred other expenses amounted to RUB60,510 thousand in the reporting year. (During 2021 the
Group incurred other expenses amounted to RUB68,007 thousand, including write-off of fixed assets amounted
to RUB26,753 thousand).
MD MEDICAL GROUP INVESTMENTS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
35
MD MEDICAL GROUP INVESTMENTS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
10. INCOME TAX
Reconciliation between profit before tax and income tax expense:
2022 2021
RUB'000
RUB'000
Profit before tax 4,726,386 6,158,268
Less profit before tax of non-taxable subsidiaries (5,048,713) (6,447,365)
Loss before tax excluding not-taxable subsidiaries (322,327) (289,097)
Tax using the Group’s domestic tax rate 64,465 57,819
Effect of subsidiaries taxable at lower tax rates 586 99
Non-deductible expenses (10,138) (20,086)
Current-year losses for which no deferred tax asset is recognised (62,500) (53,074)
Total income tax expense (7,586) (15,242)
11.
EARNINGS PER SHARE
2022
2021
4,560,217
6,003,486
Weighted average number of ordinary shares in issue during the year
75,125,010
75,125,010
Basic and fully diluted earnings per share (RUB)
60.70
79.91
12.
DIVIDENDS
As at 31 December 2022, there were temporary differences (before calculating tax effect) of RUB11,486,136
thousand (31 December 2021: RUB9,965,811 thousand) related to investments in subsidiaries. Deferred tax
liabilities related to these temporary differences were not recognised because the Group controls the dividend
policy of its subsidiaries and, therefore, controls the timing of reversal of the related taxable temporary
differences and management is satisfied that they will not reverse in the foreseeable future.
All Group companies, that are offering medical services and are operating in the Russian Federation and meet
the conditions specified in the Federal law 395-N, apply 0% corporate income tax rate. Other companies apply
standard income tax rate of 20% or 15%.
On 3 September 2021 the Board of Directors recommended the payment of RUB1,352,249 thousand as interim
dividends which corresponds to RUB
18 per share. The dividends were paid on 26 October 2021.
As at 31 December 2022 deferred tax assets relating to tax losses carried forward in the amount of RUB395,785
thousand (31 December 2021: RUB333,285 thousand) have not been recognised. Deferred tax assets have not
been recognised in respect of these tax losses because it is not probable that future taxable profit will be
available for utilisation against the benefits therefrom.
Basic and fully diluted earnings attributable to the owners of the Company (RUB'000)
On 19 March 2021 Board of Directors recommended the payment of RUB1,427,375 thousand as final dividends
for the year 2020 which corresponds to RUB
19 per share. The dividends were paid on 25 May 2021.
On 26 October 2022 the Board of Directors recommended the payment of RUB642,319 thousand as interim
dividends which corresponds to RUB
8,55 per share. The dividends were paid on 29 November 2022.
All entities of the Group are the tax resident of Russian Federation.
MD MEDICAL GROUP INVESTMENTS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
36
MD MEDICAL GROUP INVESTMENTS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
13. PROPERTY, PLANT AND EQUIPMENT
Freehold land
and buildings
Property under
construction
Plant and
equipment
Right-of-use of
freehold land,
buildings and
plant and
equipment
Total
RUB'000
RUB'000
RUB'000
RUB'000
RUB'000
Initial cost
Balance as at 1 January 2021 21,283,540 158,752 9,158,576 723,077 31,323,945
Additions 53,044 3,696,801 327,992 331,199 4,409,036
Disposals (10,390) (436) (159,485) (53,168) (223,479)
Transfer from construction in progress 749,169 (1,398,872) 649,703 - -
Balance as at 31 December 2021 22,075,363 2,456,245 9,976,786 1,001,108 35,509,502
Additions 49,429 981,538 151,059 65,758 1,247,784
Disposals (33,911) (815) (83,205) (54,705) (172,636)
Impairment loss (1,000,015) (85,525) - - (1,085,540)
Transfer from construction in progress 2,527,195 (3,192,038) 664,843 - -
Balance as at 31 December 2022 23,618,061 159,405 10,709,483 1,012,161 35,499,110
Depreciation
Balance as at 1 January 2021 (2,231,515) - (5,562,862) (233,030) (8,027,407)
Depreciation during the year (461,155) - (991,882) (124,005) (1,577,042)
Accumulated depreciation on disposals 5,133 - 137,427 22,785 165,345
Balance as at 31 December 2021 (2,687,537) - (6,417,317) (334,250) (9,439,104)
Depreciation during the year (502,409) - (978,440) (135,698) (1,616,547)
Accumulated depreciation on disposals 7,381 - 69,256 7,821 84,458
Balance as at 31 December 2022 (3,182,565) - (7,326,501) (462,127) (10,971,193)
Carrying amounts
Balance as at 1 January 2021 19,052,025 158,752 3,595,714 490,047 23,296,538
Balance as at 31 December 2021 19,387,826 2,456,245 3,559,469 666,858 26,070,398
Balance as at 31 December 2022 20,435,496 159,405 3,382,982 550,034 24,527,917
MD MEDICAL GROUP INVESTMENTS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
37
MD MEDICAL GROUP INVESTMENTS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
13.
PROPERTY, PLANT AND EQUIPMENT (continued)
On 30 June 2022 the Group performed the annual impairment tests for all CGUs with a goodwill (see Note 14),
as well as considered whether the changes in the economic environment represents impairment indicators for
other CGUs. The testing was performed for a number of CGUs. No additional impairment loss was identified. No
reasonably possible change in key assumptions will cause an impairment.
Impairment loss of Ufa hospital’s property, plant and equipment
As at 30 June 2022, due to macroeconomic conditions, such as a deterioration in general economic situation, and
excessive capacity, the Group performed an impairment test with respect to property, plant and equipment of
the regional hospital of LLC MD PROJECT 2010 located in Ufa, representing a separate CGU.
The recoverable amount of this CGU was based on its value in use, determined by discounting the future cash
flows to be generated from the continuing use of the CGU. The carrying amount of the CGU (RUB2,936,892
thousand) exceeded its recoverable amount (RUB1,936,877 thousand) and an impairment loss of RUB1,000,015
thousand was recognised (the year ended 31 December 2021: nil). The impairment loss was allocated to
property, plant and equipment.
The recoverable amount was estimated based on the value in use, which was determined using a pre-tax
discount rate of 17.5% and a terminal growth rate of 4% applied after the 5.5-year projection period.
The discount rate was based on the rate of 10-year bonds issued by the Russian government, adjusted for a risk
premium to reflect both the increased risk of investing in equities generally and the systematic risk of the specific
CGU.
The long-term growth rate into perpetuity has been determined as the lower of the nominal gross domestic
product (GDP) rates for Russia, where the CGU operates, and the long-term compound annual revenue growth
rate estimated by management.
Estimated EBITDA was based on expectations of future outcomes taking into account past experience, whereas
the EBITDA margin amounted to 20.4%-23.2% further adjusted for anticipated annual revenue growth of 4% -
6.8%. Revenue growth was projected taking into account the estimated utilization and price growth for the next
five years.
Once the impairment loss was recognised, the recoverable amount equaled the carrying amount. Therefore, any
adverse movement in a key assumption would have led to further impairment.
Impairment loss of construction documentation in Saint-Petersburg
During the reporting period the Group recognized an impairment of previously acquired construction
documentation in the amount of RUB85,525 thousand as the Group revised its plans on construction of a clinic in
Saint-Petersburg that made the documentation no longer usable (During the year ended 31 December 2021: nil).
The impairment loss was allocated to construction in progress. I
mpairment testing of other CGUs As at 31 December 2022 the Group considered whether there were indicators of additional impairment or
reversal thereof and concluded that there were none.
MD MEDICAL GROUP INVESTMENTS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
38
MD MEDICAL GROUP INVESTMENTS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
13.
PROPERTY, PLANT AND EQUIPMENT (continued)
14. INTANGIBLE ASSETS
Goodwill Patents and
trademarks
Software and
website Total
RUB'000
RUB'000
RUB'000
RUB'000
Initial cost
Balance as at 1 January 2021 2,032,320 564,812 253,072 2,850,204
- - 58,466 58,466
Balance as at 31 December 2021 2,032,320 564,812 311,538 2,908,670
Additions - - 70,017 70,017
Impairment loss (201,034) - - (201,034)
Balance as at 31 December 2022 1,831,286 564,812 381,555 2,777,653
Amortisation
Balance as at 1 January 2021 - (511,384) (133,165) (644,549)
Amortisation during the year - (53,426) (68,750) (122,176)
Balance as at 31 December 2021 - (564,810) (201,915) (766,725)
Amortisation during the year - (2) (51,107) (51,109)
Balance as at 31 December 2022 - (564,812) (253,022) (817,834)
Carrying amounts
Balance as at 1 January 2021 2,032,320 53,428 119,907 2,205,655
Balance as at 31 December 2021 2,032,320 2 109,623 2,141,945
Balance as at 31 December 2022 1,831,286 - 128,533 1,959,819
31 December
2022
31 December
2021
RUB'000
RUB'000
1,055,593 1,055,593
360,154 360,154
LLC Medica-2 47,216 248,250
CJSC MK IDK 211,303 211,303
LLC Centre of Reproductive Medicine 142,193 142,193
Subsidiaries acquired in 2011 14,827 14,827
1,831,286 2,032,320
As a result the Group did not recignise any additional impairment other than mentioned above.
Additions
J
SC MC Avicenna ARTMed Group (Centres of Reproductive Medicine, located in Krasnoyarsk, Omsk,
Novosibirsk and Barnaul)
Construction in progress includes machinery and equipment, X-ray equipment, tomographs and other items of
property, plant and equipment not yet available for use and predominantly relates to the buildings construction
through the use of sub-contractors.
As at 31 December 2022 construction in progress mainly includes construction costs of Lapino hospital (LLC
Khaven) amounting to RUB91,148 thousand and MD Group hospital (JSC MD PROJECT 2000) amounting to
RUB26,746 thousand (31 December 2021: MD Lakhta hospital (LLC Khaven) - RUB1,825,075 thousand and
Tyumen-2 hospital (LLC Mother and Child Tyumen) - RUB564,720 thousand).
Goodwill is allocated to each cash-generating unit (CGU), which is defined as an individual subsidiary or group of
subsidiaries acquired operating as one business in one particular location.
MD MEDICAL GROUP INVESTMENTS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
39
14. INTANGIBLE ASSETS (continued)
15. TRADE, OTHER RECEIVABLES AND DEFERRED EXPENSES
31 December
2022
31 December
2021
RUB'000
RUB'000
Trade receivables net of impairment provision 734,938 751,604
Advances paid to suppliers 113,013 119,336
CAPEX prepayments 87,928 339,909
Deferred expenses 7,884 4,866
Property tax to be reimbursed 83 59,735
Other receivables 55,913 35,800
999,759 1,311,250
Non-current portion 87,928 339,909
Current portion 911,831 971,341
999,759 1,311,250
30 June 2022.
As a result the Group did not recognise any additional impairment other than mentioned above.
The recoverable amount of this CGU was based on its value in use, determined by discounting the future cash
flows to be generated from the continuing use of the CGU. The carrying amount of the CGU (RUB323,112
thousand) was determined to be higher than its recoverable amount (RUB122,078 thousand) and an impairment
loss of RUB201,034 thousand was recognized during the year ended 31 December 2022 (the year ended
The discount rate and terminal growth rate were as specified above in the Note 13. The EBITDA margin was
assessed as 15.8%-18% and the revenue growth rate was 4%-6.1% for the 5.5 years projection period. Impairment test of other subsidiaries
The discount rate and terminal growth rate were as specified above in the Note 13. The revenue growth rate was
4%-9% and EBITDA margin for JSC MC Avicenna, ARTMed Group (Centres of Reproductive Medicine, located in
Krasnoyarsk, Omsk, Novosibirsk and Barnaul), JSC MK IDK and other was 30.2%-30.9%, 40.5%-42.1% and
27.5%-33.4% respectively for the 5.5 years projection period.
31 December 2021: nil). The impairment loss was allocated to goodwill.
The Group performed an impairment test with respect to goodwill in other subsidiaries as at
30 June 2022.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
I
mpairment loss of Medica-2 The Group performed an impairment test with respect to goodwill in regional clinic LLC Medica-2 as at
No impairment loss was identified. No reasonably possible change in key assumptions will cause an impairment.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
40
15. TRADE, OTHER RECEIVABLES AND DEFERRED EXPENSES (continued)
Ageing analysis of trade receivables:
Gross amount Impairment Gross amount Impairment
31 December
2022
31 December
2022
31 December
2021
31 December
2021
RUB'000
RUB'000
RUB'000
RUB'000
Not past due 594,321 (1,028) 572,052 (9,434)
Past due 375,662 (234,017) 320,647 (131,661)
969,983 (235,045) 892,699 (141,095)
Ageing Status
Weighted-
average
loss rate
2022
Loss
allowance
2022
Gross carrying
amount 2021
Loss
allowance
2021
RUB'000
RUB'000
RUB'000
0-30 days past due 18% 46,081 (8,436) 48,317 (7,685)
31-60 days past due 33% 7,986 (2,633) 17,740 (4,757)
61-90 days past due 44% 7,115 (3,159) 19,251 (5,840)
more than 91 days past due 74% 243,736 (180,321) 187,059 (83,542)
TOTAL 304,918 (194,549) 272,367 (101,824)
Ageing Status
Weighted-
average
loss rate
2022
Loss
allowance
2022
Gross carrying
amount 2021
Loss
allowance
2021
RUB'000
RUB'000
RUB'000
0-30 days not past
due 13% 7,636 (1,028) 37,383 (9,434)
31-60 days past due 20% 5,993 (1,188) 17,187 (5,001)
61-90 days past due 28% 3,142 (875) 1,553 (630)
more than 91 days past due 58% 61,609 (36,031) 29,540 (22,833)
TOTAL 78,380 (39,122) 85,663 (37,898)
Based on the analysis of the historical data for accounts receivable from related parties amounted to RUB67,875
thousand no provision is accrued. For accounts receivable from insurance companies amounted to RUB518,810
thousand provision is accrued only for those which licences had been revoked (as the most part relates to
accounts receivable for MHI services provided which payments are guaranteed by the government). Such
provision of RUB1,373 thousand was accrued as at 31 December 2022 (31 December 2021: RUB1,373
thousand).
RUB'000
The exposure of the Group to credit and currency risk in relation to trade, other receivables and deferred
expenses is reported in Note 23 of these consolidated financial statements.
Gross carrying
amount 2022
31 December 2022.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
The following table provides information about the exposure to credit risk and ECLs for trade receivables for
patients as at 31 December 2022.
RUB'000
In addition to the bad debt provision accrued as at 31 December 2022 the accounts receivable in the amount of
RUB118 thousand were written-off during the year ended 31 December 2022 (year ended 31 December 2021:
RUB2,023 thousand).
The Group performed the calculation of ECL rates separately for patients, legal entities and insurance companies,
meanwhile ECL rates for the insurance companies were calculated based on their ratings.
The following table provides information about the exposure to credit risk and ECLs for trade and other
receivables for legal entities except insurance companies and amounts receivable from related parties as at
Gross carrying
amount 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
41
16. CASH AND CASH EQUIVALENTS AND SHORT-TERM DEPOSITS
31 December
2022
31 December
2021
RUB'000
RUB'000
Current bank accounts and cash in hand 901,000 1,536,457
Bank deposits with maturity less than 3 months 3,561,740 2,053,166
TOTAL CASH AND CASH EQUIVALENTS 4,462,740 3,589,623
Currency:
31 December
2022
31 December
2021
RUB'000
RUB'000
RUB 4,399,794 2,869,105
USD 62,946 720,518
4,462,740 3,589,623
17.
SHARE CAPITAL
Authorised 125,250,000
0.08
-
10,020
75,125,010
0.08
180,585
6,010
18. SHARE PREMIUM, RESERVES AND RETAINED EARNINGS
Share premium
There were no changes during 2022.
Common control transactions reserve includes differences between the carrying amount of net assets acquired
through purchases of subsidiaries from parties under common control and the consideration paid for their
acquisition.
Retained earnings
Retained earnings include accumulated profits and losses incurred by the Group.
Share capital
USD'000
Share capital Nominal value
USD
Reserves
Reserves include negative common control transactions reserve in the amount of RUB682,873 thousand and
positive capital contribution reserve in the amount of RUB27,521 thousand.
RUB'000
Share premium includes the total amount received in excess of the total nominal value of the new share capital
issued. Incremental costs directly attributable to the issue of new shares are recognised as a deduction from
equity (share premium) net of any tax effect.
Issued and fully paid ordinary shares
1 January / 31 December
shares
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
The exposure of the Group to credit risk and currency risk in relation to cash and cash equivalents is reported in
Note 23 of these consolidated financial statements.
Number of
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
42
19. LOANS AND BORROWINGS
31 December
2021
RUB'000
Long-term liabilities
Bank loans 3,129,443
Lease liabilities 597,264
Short-term liabilities
Bank loans 1,688,878
Lease liabilities 97,448
Total loans and borrowings 5,513,033
Maturity of loans and borrowings:
31 December
2021
RUB'000
Within one year 1,786,326
Between one and five years 3,515,922
More than 5 years 210,785
5,513,033
Currency Maturity Carrying amount
RUB'000
Unsecured bank loan RUB 2023 1,012,859
Unsecured bank loan RUB 2024 1,128,830
Unsecured bank loan RUB 2022 210,247
Unsecured bank loan RUB 2026 2,466,385
Current lease liabilities RUB 2023 97,448
Non-current lease liabilities RUB 2024-2032 597,264
5,513,033
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
31 December
2022
RUB'000
489,200
-
106,426
595,626
489,200 489,200
106,426 106,426
595,626
The contractual cash flows and the exposure of the Group to liquidity risk in relation to loans and borrowings is
reported in Note 23 of these consolidated financial statements.
595,626
597,264
5,513,033
97,448
31 December 2022 31 December 2021
1,128,830
- - 2,466,385
- - 210,247
- -
- - 1,012,859
RUB'000
RUB'000
RUB'000
595,626
No property, plant and equipment was held as collateral for the bank loans as at 31 December 2021. More
information is disclosed in Note 13.
The terms and debt repayment schedule of loans and lease liabilities are as follows:
31 December
2022
RUB'000
-
106,426
109,439
379,761
Face value Carrying amount Face value
In the reporting period, the Group fully repaid all its existing credit facilities by settling outstanding obligations
ahead of schedule.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
43
MD MEDICAL GROUP INVESTMENTS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
19. LOANS AND BORROWINGS (continued)
31 December 2021
Lease liabilities
RUB'000
Balance at 1 January 6,309,964 508,034
Changes in cash flows
Repayment of loans and borrowings (1,490,806) -
Payments of lease liabilities - (152,470)
Interest under lease agreements paid
Interest paid included in financing cash flows (340,077) -
Total changes in cash flows (1,830,883) (152,470)
Liability-related changes
Additions of lease liabilities - 331,199
Leases terminated - (41,084)
Interest accrued during the period 339,240 49,033
Total liability-related other changes 339,240 339,148
Balance at 31 December 4,818,321 694,712
20.
CONTRACT LIABILITIES
31 December
2022
31 December
2021
RUB'000
RUB'000
Patient advances
2,051,929
2,030,778
including:
Contract liabilities after more than one year
468,505
460,420
Contract liabilities within one year
1,583,424
1,570,358
21. TRADE AND OTHER PAYABLES
31 December
2022
31 December
2021
RUB'000
RUB'000
Other payables to tax authorities 923,279 785,084
Taxes payable 814,083 278,294
Accruals 702,537 686,820
Trade payables 517,270 1,080,420
Payables to employees 462,884 462,495
CAPEX payables 66,575 268,879
Income tax liability 3,142 1,813
Other payables 61,802 71,235
3,551,572 3,635,040
Non-current portion 729,173 624,808
Current portion 2,822,399 3,010,232
3,551,572 3,635,040
Contract liabilities that relate to long term client advances represent money received from patients on stem cells
storage contracts lasting from 1 to 30 years and long-term contracts for offering medical services
lasting from 1
to 5 years. Contract liabilities that relate to short term client advances represent money received from patients
on stem cells storage contracts, childbirth management contracts lasting from 1 to 9 months, and other contracts
valid up to 1 year.
(4,805,599)
-
(5,046,928) (150,743)
-
- 595,626
228,607 51,881
- (98,862)
(241,329) -
(65,982)
228,607 51,657
-
65,758
-
Reconciliation of movements of financial liabilities to cash flows arising from financing activities
RUB'000
31 December 2022
Bank loans
RUB'000
RUB'000
Bank loans Lease liabilities
4,818,321 694,712
- (51,881)
MD MEDICAL GROUP INVESTMENTS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
19. LOANS AND BORROWINGS (continued)
44
MD MEDICAL GROUP INVESTMENTS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
21. TRADE AND OTHER PAYABLES (continued)
22.
RELATED PARTY TRANSACTIONS
The following transactions were carried out with related parties:
22.1.
Balances and transactions with related parties
The Group received medical services from related parties amounted to RUB51,383 thousand for the year ended
31 December 2022 (for the year ended 31 December 2021: RUB71,819 thousand).
The payables from medical services which remained unpaid as at 31 December 2022 was RUB6,759 thousand
(31 December 2021: RUB17,769 thousand).
The Group purchased intangible assets from related parties amounted to RUB14,173 thousand for the year
ended 31 December 2022 (for the year ended 31 December 2021: RUB5,010 thousand).
The Group provided services to the key management personnel under non-exclusive commercial concession
agreement for the year ended 31 December 2022 amounted to RUB1,671 thousand (for the year ended
The receivables for services under non-exclusive commercial concession agreements which remained unpaid as
31 December 2021: RUB1,527 thousand).
31 December 2022 was RUB396 thousand (as at 31 December 2021: RUB548 thousand).
The Group provided medical informational services to related parties amounted to RUB395,949 thousand for the
year ended 31 December 2022 (for the year ended 31 December 2021: RUB310,438 thousand) and received
commission services from related parties amounted to RUB59,138 thousand for the year ended 31 December
2022 (for the year ended 31 December 2021: RUB41,620 thousand).
The receivables from medical informational services which remained unpaid as at 31 December 2022 was
RUB67,479 thousand (31 December 2021: RUB36,795 thousand).
The Group purchased medical materials from related parties amounted to RUB189,954 thousand for year ended
31 December 2022 (for the year ended 31 December 2021: RUB140,721 thousand).
The payables for medical materials as at 31 December 2022 were RUB15,719 thousand (the payables as at
31 December 2021: RUB10,768 thousand).
The contractual cash flows (except for income tax liability) and the exposure of the Group to liquidity risk in
relation to trade and other payables is reported in Note 23 of these consolidated financial statements.
The group received the right to postpone a portion of social insurance payments (included in taxes payable) for 2
years due to Governmental Decree #776 on 29 April 2022. However, the Group plans to settle these liabilities
fully in 2023.
The remuneration of the members of the key management personnel and non-executive directors for the year
ended 31 December 2022 was RUB122,164 thousand (for the year ended 31 December 2021: RUB142,277
thousand).
31 December 2022 was RUB24,977 thousand (31 December 2021: RUB25,338 thousand)
. The remuneration of the members of the key management personnel which remained unpaid as at
MD MEDICAL GROUP INVESTMENTS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
21. TRADE AND OTHER PAYABLES (continued)
45
MD MEDICAL GROUP INVESTMENTS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
22.
RELATED PARTY TRANSACTIONS
22.2. Directors' interests
Name Type of interest
Mark Kurtser Indirect ownership of shares
Kirill Dmitriev (resigned on 5 March 2022) Indirect interest in shares
Simon Rowlands (resigned on 9 March 2022) Direct ownership of shares
Vitaly Ustimenko Direct ownership of shares
22.3.
Dividends declared to related parties
23.
FINANCIAL RISK MANAGEMENT
Financial risk factors
The Group is exposed to the following risks from its use of financial instruments:
• Credit risk
• Liquidity risk
• Market risk
(i) Credit risk
The direct and indirect interests of the members of the Board in titles of the Company as at 31 December 2022,
31 December 2021 and as at the date of signing these consolidated financial statements are as follows:
Member of the Board of Directors Vitaly Ustimenko acquired GDRs on 27 May 2022 and 29 June 2022, as a result
the share of his ownership increased from 0.0053% to 0.0054% of the Сompany's share capital.
The calculation of effective interest is based on the total amount of issued and fully paid shares, including
treasury shares acquired by the Company.
The Board of Directors has the overall responsibility for the establishment and supervision of the Company's risk
management framework.
The Group's risk management policies are established to identify and analyse the risks faced by the Group to set
appropriate risk limits and controls and monitor risks and adherence to limits. Risk management policies and
systems are reviewed regularly to reflect changes in market conditions and in the Group's activities.
Credit risk arises when a failure by counterparties to discharge their obligations could reduce the amount of
future cash inflows from financial assets on hand at the reporting date. The Group has no significant
concentration of credit risk. The Group has policies in place to ensure that sales of products and services are
made to customers with an appropriate credit history and monitors on a continuous basis the ageing profile of its
receivables.
Effective interest %
67.90
5.55
0.33
0.005
Indirect interest in shares by Kirill Dmitriev arises through his capacity as key management personnel of indirect
shareholder.
Dividends declared to the parent company MD Medical Holding Limited amounted to RUB436,250 thousand for
the year ended 31 December 2022 (31 December 2021: RUB1,887,866 thousand).
MD MEDICAL GROUP INVESTMENTS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
46
MD MEDICAL GROUP INVESTMENTS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
23.
FINANCIAL RISK MANAGEMENT (continued)
(i) Credit risk (continued)
Exposure to credit risk
31 December
2022
31 December
2021
RUB'000
RUB'000
Trade and other receivables 792,817 846,706
Cash and cash equivalents excluding cash in hand 4,451,895 3,578,216
5,244,712 4,424,922 Trade and other receivables
Cash and cash equivalents and short-term bank deposits
Number of banks External credit rating Carrying amount
3 ruAAA 4,376,840
2 other 75,055
Total
Number of banks External credit rating Carrying amount
2 Baa3 2,883,927
1 A2 394,682
2 A1 299,607
Total
The Group's exposure to credit risk is influenced mainly by the individual characteristics of each customer. The
Group has no significant concentration of credit risk regarding trade and other receivables. This fact significantly
reduces possible delays and other negative consequences that may potentially affect matching the maturity of
assets with liabilities. Furthermore, according to the internal policy, clients usually pay in advance except for
some particular cases.
The Group held cash and cash equivalents excluding cash in hand of RUB4,451,895 thousand as at 31 December
2022 (31 December 2021: RUB3,578,216 thousand) which represents its maximum credit exposure on these
assets. The Group maintains the majority of cash with the bank that is subject to sanctions. No rating from
international rating agencies was available as at 31 December 2022. In accordance with the Russian rating
agency AKRA the rating was ААА(RU).
T
he carrying amount of financial assets represents the maximum credit exposure. The maximum exposure to credit risk at the reporting date was:
4,451,895
The carrying amounts as of 31 Dcember 2021 and external ratings of 2021 were as follows:
3,578,216
The cash and cash equivalents and short-term bank deposits were mostly held with bank and financial institution
counterparties, which were rated Baa3-A1, based on rating agency Moody’s Investors Service ratings.
MD MEDICAL GROUP INVESTMENTS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
MD MEDICAL GROUP INVESTMENTS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
23.
FINANCIAL RISK MANAGEMENT (continued)
( ii) Liquidity risk
Carrying Contractual cash 2 months Between Between Between More than 5
amounts flows or less 2-12 months 1-2 years 2-5 years years
RUB'000
RUB'000
RUB'000
RUB'000
RUB'000
RUB'000
RUB'000
Lease liabilities 19 595,626 735,399 27,429 135,392 144,233 292,381 135,964
CAPEX payables 21 66,575 66,575 14,094 52,481 - - -
21 517,270 517,270 517,270 - - - -
Other payables and accrued expenses 21 2,964,585 3,283,014 1,018,786 1,217,162 195,521 429,877 421,668
4,144,056 4,602,258 1,577,579 1,405,035 339,754 722,258 557,632
Carrying Contractual cash 2 months Between Between Between More than 5
amounts flows or less 2-12 months 1-2 years 2-5 years years
RUB'000
RUB'000
RUB'000
RUB'000
RUB'000
RUB'000
RUB'000
Bank loans 19 4,818,321 5,327,905 333,966 1,580,779 1,548,275 1,864,885 -
Lease liabilities 19 694,712 886,444 24,670 120,691 143,298 361,691 236,094
CAPEX payables 21 268,879 268,879 123,820 145,059 - - -
21 1,080,420 1,080,420 1,080,420 - - - -
Other payables and accrued expenses 21 2,283,928 2,560,592 1,020,010 637,417 161,843 379,765 361,557
9,146,260 10,124,240 2,582,886 2,483,946 1,853,416 2,606,341 597,651
Trade payables
31 December 2022
31 December 2021
Trade payables
Liquidity risk is the risk that arises when the maturity of assets and liabilities does not match. An unmatched position potentially enhances profitability, but can also increase the
risk of losses. The Group has procedures to minimise such losses including maintaining sufficient cash and other highly liquid current assets.
T he following are the contractual maturities of financial liabilities including estimated interest payments:
Note
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
48
23. FINANCIAL RISK MANAGEMENT (continued)
(
iii) Market risk Interest rate risk
31 December 31 December
2022 2021
RUB'000
RUB'000
Fixed rate instruments
Financial assets 3,561,740 2,053,166
Financial liabilities (595,626) (5,513,033)
2,966,114 (3,459,867)
Currency risk
The Group's exposure to foreign currency risk was as follows:
USD
EUR
USD
EUR
Assets
Cash at bank 62,946 - 720,518 -
- - 464 -
Liabilities
CAPEX payables (23,515) (2,207) (59,813) (22,227)
(3,491) (48) - (40)
Net exposure 35,940 (2,255) 661,169 (22,267)
Market risk is the risk that changes in market prices, such as foreign exchange rates and interest rates, may
affect the Group's income or the value of its holdings of financial instruments.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
MD MEDICAL GROUP INVESTMENTS PLC
Interest rate risk is the risk that the value of financial instruments will fluctuate due to changes in market interest
rates. Borrowings issued at variable rates expose the Group to cash flow interest rate risk. Borrowings issued at
fixed rates expose the Group to fair value interest rate risk. The Group's management monitors the interest rate
fluctuations on an ongoing basis and acts accordingly.
As at the reporting date the interest rate profile of interest bearing financial instruments was as follows:
The Group does not account for any fixed interest rate instruments at fair value through profit or loss and does
not have any derivative financial instruments, therefore a change in interest rates at the reporting date would not
affect profit or loss or equity.
Currency risk is the risk that the value of financial instruments will fluctuate due to changes in foreign exchange
rates. Currency risk arises when future commercial transactions and recognised assets and liabilities are
denominated in a currency that is not the Group's functional currency. The Group is exposed to foreign exchange
risk arising from various currency exposures primarily with respect to the United States Dollar and the Euro. The
Group's management monitors the exchange rate fluctuations on an ongoing basis and acts accordingly.
Trade and other payables and accruals
31 December 2022 31 December 2021
Trade and other receivables
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
MD MEDICAL GROUP INVESTMENTS PLC
49
23. FINANCIAL RISK MANAGEMENT (continued)(
iii) Market risk (continued) Currency risk (continued) 2022
2021
2022
2021
USD 68.5494 73.6541 70.3375 74.2926
EUR 72.5259 87.1877 75.6553 84.0695
GBP 85.5708 101.3437 84.7919 100.0573
GBP
Sensitivity analysis
Capital management
Note 31 December
2022
31 December
2021
RUB'000
RUB'000
Financial liabilities 19 595,626 5,513,033
Less: cash and cash equivalents 16 (4,462,740) (3,589,623)
Net debt (3,867,114) 1,923,410
Total equity 26,963,262 23,097,192
Net debt to equity ratio -14.34% 8.33%
24.
FAIR VALUES
The Group monitors capital on the basis of the net debt to equity ratio. This ratio is calculated as net debt
divided by total equity. Net debt is calculated as total loans and borrowings less cash and cash equivalents. Total
equity is calculated as “equity” shown in the consolidated statement of financial position.
As at 31 December 2022 and 31 December 2021 the Group had no significant financial assets or liabilities
measured at fair value.
The financial assets of the Group include cash and cash equivalents and trade and other receivables. The
financial liabilities of the Group include loans and borrowings and trade and other payables. The fair value of
these financial instruments is classified as Level 3 of fair value class hierarchy and is estimated only for disclosure
purposes using discounted cash flows taking interest rates adequate to the relevant risk. The fair values of the
Group's financial assets and liabilities approximate their carrying amounts at the reporting date.
MD MEDICAL GROUP INVESTMENTS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
The Group's objectives in managing capital are to safeguard the Group's ability to continue as a going concern in
order to provide returns to owners and to maintain an optimal capital structure to reduce the cost of capital.
In order to maintain or adjust the capital structure the Group may adjust the amount of dividends paid to
shareholders, return capital to owners or issue of new shares.
Average rate Reporting date spot rate
A 10% weakening of the Russian Ruble against the above currencies will result in the increase in profit and
equity of RUB3,369 thousand as at 31 December 2022 (31 December 2021: RUB63,890 thousand). A 10%
strengthening of the Russian Ruble would have an opposite impact.
The following significant exchange rates applied during the year:
23. FINANCIAL RISK MANAGEMENT (continued)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
50
25. OPERATING ENVIRONMENT
It is difficult to assess the consequences of the imposed and possible additional sanctions as well as partial
mobilization, in the long term, however, these events can have a significant negative impact on the Russian
economy.
In addition, Russian companies have virtually no access to the international stock market, the debt capital market
and other development opportunities, which may lead to their increased dependence on the governmental
support. The Russian economy is in the process of adaptation associated with the replacement of retiring export
markets, a change in supply markets and technologies, as well as changes in logistics, supply and production
chains.
The wave-like nature of the spread of COVID-19 coronavirus infection continues to create additional uncertainty
in the business environment.
Further to the sanctions the London Stock Exchange has suspended the admission to trading of the Group`s
instruments on 3 March 2022.
Starting in 2014, the United States of America, the European Union and some other countries have imposed and
gradually expanded economic sanctions against a number of Russian individuals and legal entities. Since
February 2022, after the recognition of the self-proclaimed Donetsk and Lugansk People's Republics and the start
of a special military operation in Ukraine by the Russian Federation, the above countries have imposed additional
tough sanctions against the Government of the Russian Federation, as well as large financial institutions, legal
entities and individuals in Russia. In addition, restrictions were imposed on the supply of various goods and
services to Russian enterprises. Also, in the context of the imposed sanctions, a number of large international
companies from the United States, the European Union and other countries discontinued, significantly reduced or
suspended their own activities in the Russian Federation, as well as doing business with Russian citizens and
legal entities.
(a) Insurance
As per current legislation in Russian Federation medical clinics are not required to insure their activities. There is
a draft Law regarding obligatory insurance of medical clinics as from 2013. The Law has not yet been enacted. At
present the Group does not insure its operational activities but has obtained insurance cover for some property,
plant and equipment. Until the Group obtains adequate insurance coverage there is a risk of material adverse
effect on operations and statement of financial position.
The imposition and subsequent strengthening of sanctions and the partial mobilization resulted in elevated
economic uncertainty, including reduced liquidity and high volatility in the capital markets, volatility of the Rouble
exchange rate and the key interest rate, a decrease in foreign and domestic direct investments, difficulties in
making payments for Russian Eurobond issuers, and also a significant reduction in the availability of sources of
debt financing.
In September 2022, partial mobilization was announced in the Russian Federation. Referendums were held in the
recognized republics of Donetsk and Lugansk, as well as in the Zaporozhye and Kherson regions of Ukraine,
which resulted in incorporation of the territories into the Russian Federation. As a result of these events further
sanctions were imposed and there is a risk of increasing pressure on the Russian economy. In response to the
above, the Government of the Russian Federation has introduced a set of measures, which are counter-
sanctions, currency control measures, a number of key interest rate decisions and other special economic
measures to ensure the security and maintain the stability of the Russian economy.
MD MEDICAL GROUP INVESTMENTS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
(b) Russian business environment
The Group’s operations are primarily located in the Russian Federation. Consequently, the Group is exposed to
the economic and financial markets of the Russian Federation, which display the characteristics of an emerging
market. The legal, tax and regulatory frameworks continue development, but are subject to varying
interpretations and frequent changes which contribute together with other legal and fiscal impediments to the
challenges faced by entities operating in the Russian Federation.
25. OPERATING ENVIRONMENT
It is difficult to assess the consequences of the imposed and possible additional sanctions as well as partial
mobilization, in the long term, however, these events can have a significant negative impact on the Russian
economy.
In addition, Russian companies have virtually no access to the international stock market, the debt capital market
and other development opportunities, which may lead to their increased dependence on the governmental
support. The Russian economy is in the process of adaptation associated with the replacement of retiring export
markets, a change in supply markets and technologies, as well as changes in logistics, supply and production
chains.
The wave-like nature of the spread of COVID-19 coronavirus infection continues to create additional uncertainty
in the business environment.
Further to the sanctions the London Stock Exchange has suspended the admission to trading of the Group`s
instruments on 3 March 2022.
Starting in 2014, the United States of America, the European Union and some other countries have imposed and
gradually expanded economic sanctions against a number of Russian individuals and legal entities. Since
February 2022, after the recognition of the self-proclaimed Donetsk and Lugansk People's Republics and the start
of a special military operation in Ukraine by the Russian Federation, the above countries have imposed additional
tough sanctions against the Government of the Russian Federation, as well as large financial institutions, legal
entities and individuals in Russia. In addition, restrictions were imposed on the supply of various goods and
services to Russian enterprises. Also, in the context of the imposed sanctions, a number of large international
companies from the United States, the European Union and other countries discontinued, significantly reduced or
suspended their own activities in the Russian Federation, as well as doing business with Russian citizens and
legal entities.
(a) Insurance
As per current legislation in Russian Federation medical clinics are not required to insure their activities. There is
a draft Law regarding obligatory insurance of medical clinics as from 2013. The Law has not yet been enacted. At
present the Group does not insure its operational activities but has obtained insurance cover for some property,
plant and equipment. Until the Group obtains adequate insurance coverage there is a risk of material adverse
effect on operations and statement of financial position.
The imposition and subsequent strengthening of sanctions and the partial mobilization resulted in elevated
economic uncertainty, including reduced liquidity and high volatility in the capital markets, volatility of the Rouble
exchange rate and the key interest rate, a decrease in foreign and domestic direct investments, difficulties in
making payments for Russian Eurobond issuers, and also a significant reduction in the availability of sources of
debt financing.
In September 2022, partial mobilization was announced in the Russian Federation. Referendums were held in the
recognized republics of Donetsk and Lugansk, as well as in the Zaporozhye and Kherson regions of Ukraine,
which resulted in incorporation of the territories into the Russian Federation. As a result of these events further
sanctions were imposed and there is a risk of increasing pressure on the Russian economy. In response to the
above, the Government of the Russian Federation has introduced a set of measures, which are counter-
sanctions, currency control measures, a number of key interest rate decisions and other special economic
measures to ensure the security and maintain the stability of the Russian economy.
MD MEDICAL GROUP INVESTMENTS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
(b) Russian business environment
The Group’s operations are primarily located in the Russian Federation. Consequently, the Group is exposed to
the economic and financial markets of the Russian Federation, which display the characteristics of an emerging
market. The legal, tax and regulatory frameworks continue development, but are subject to varying
interpretations and frequent changes which contribute together with other legal and fiscal impediments to the
challenges faced by entities operating in the Russian Federation.
51
25. OPERATING ENVIRONMENT (continued)
26.
NON-CONTROLLING INTERESTS
2022
2021
RUB'000
RUB'000
Revenue
3,740,660
3,569,840
Profit and total comprehensive income
1,413,073
1,310,622
Profit and other comprehensive income allocated to non-controlling interests
70,654
65,531
Dividends paid to non-controlling interests
102,500
129,150
Non-controlling interests percentage
5%
5%
31 December
2022
31 December
2021
RUB'000
RUB'000
Non-current assets
2,963,704
3,613,194
Current assets
657,396
1,022,314
Non-current liabilities
(346,889)
(269,557)
Current liabilities
(739,146)
(1,193,958)
Net assets
2,535,065
3,171,993
Carrying amount of non-controlling interests
126,753
158,600
Other non-controlling interests
85,924
105,905
212,677
264,505
27.
CAPITAL COMMITMENTS
Capital commitments mostly comprise of the obligations under construction and equipment purchase contracts
in the amount of RUB681,311 thousand as at 31 December 2022 (31 December 2021: RUB1,037,548 thousand).
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
The only material non-controlling interest in the Group is related to JSC MD PROJECT 2000. The information
about the subsidiary before any intra-group eliminations is presented below.
Most of the turnovers are cash based.
(c) Russian tax environment
The taxation system in the Russian Federation continues to evolve and is characterised by frequent changes in
legislation, official pronouncements and court decisions, which are sometimes contradictory and subject to
varying interpretation by different tax authorities. The tax authorities have the power to impose fines and
penalties for tax arrears. A tax year is generally open for review by the tax authorities during three subsequent
calendar years. Currently the tax authorities are taking a more assertive and substance-based approach to their
interpretation and enforcement of tax legislation.
The consolidated financial statements reflect management’s assessment of the impact of the Russian business
environment on the operations and the financial position of the Group. The future business environment may
differ from management’s assessment.
(b) Russian business environment (continued)
The Group primarily operates in Russian healthcare system which is subject to a specific regulatory regime and
has its own peculiarities. A part of the Group’s operations are covered by the Mandatory Health Insurance that
require compliance with certain requirements.
Due to the business specifics purchases of medical equipment, medicines and medical consumables are generally
not sanctioned at the current moment. Therefore the above situation does not negatively influence the business
of the Group. The Management monitors the situation on the constant basis.
25. OPERATING ENVIRONMENT (continued)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
The taxation system in the Russian Federation continues to evolve and is characterised by frequent changes in
legislation, official pronouncements and court decisions, which are sometimes contradictory and subject to
varying interpretation by different tax authorities. The tax authorities have the power to impose fines and
penalties for tax arrears. A tax year is generally open for review by the tax authorities during three subsequent
calendar years. Currently the tax authorities are taking a more assertive and substance-based approach to their
interpretation and enforcement of tax legislation.
The consolidated financial statements reflect management’s assessment of the impact of the Russian business
environment on the operations and the financial position of the Group. The future business environment may
differ from management’s assessment.
(b) Russian business environment (continued)
The Group primarily operates in Russian healthcare system which is subject to a specific regulatory regime and
has its own peculiarities. A part of the Group’s operations are covered by the Mandatory Health Insurance that
require compliance with certain requirements.
Due to the business specifics purchases of medical equipment, medicines and medical consumables are generally
not sanctioned at the current moment. Therefore the above situation does not negatively influence the business
of the Group. The Management monitors the situation on the constant basis.
52
28.
SEGMENT REPORTING
29.
EVENTS AFTER THE REPORTING PERIOD
No other significant events occurred after the reporting period.
MD MEDICAL GROUP INVESTMENTS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022
The Group operates in Russian Federation and has one primary reporting segment: provision of medical services.
The Group evaluates the performance and makes investments and strategic decisions based upon a review of
profitability for the Group as a whole and does not group subsidiaries by geography and service lines during the
analysis of their performance.
The out-patient medical centre "Mother&Child Mytishchi" with a focus on preparation for pregnancy and childbirth
was opened on 13 January 2023.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2022