AB INVALDA INVL
Consolidated Annual Report,
Consolidated and Company’s Financial Statements for
the year ended 31 December 2021
prepared in accordance with International Financial Reporting Standards as adopted
by the European Union
Darius Šulnis, the President of Invalda INVL, signs the Consolidated and
Company's Financial Statements for 2021 as well as the Consolidated Annual
Report and Confirmation of Responsible Persons, with a qualified electronic
signature.
Raimondas Rajeckas, the CFO of Invalda INVL, signs the Consolidated and
Company's Financial Statements for 2021 as well as the Confirmation of
Responsible Persons, with a qualified electronic signature.
AB „Invalda INVL“ Įmonės kodas 121304349
Gynėjų g. 14, LT-01109 Vilnius PVM kodas LT213043414
Tel. (8 5) 279 0601 A.s. LT25 4010 0424 0124 2013
El. p. info@invaldainvl.com Luminor bank AS Lietuvos filialas
www.invaldainvl.com Registro tvarkytojas VĮ Registrų centras
Public joint-stock company Invalda INVL
CONFIRMATION OF RESPONSIBLE PERSONS
8 April 2022
Following the Information Disclosure Rules of the Bank of Lithuania and the Law on Securities (Article 12) of
the Republic of Lithuania, management of Invalda INVL, AB hereby confirms that, to the best our knowledge,
the attached Consolidated and Company‘s Financial Statements for 2021 are prepared in accordance with
International Financial Reporting Standards (IFRS) as adopted by the European Union, give true and fair view
of the assets, liabilities, financial position and profit or loss as well as cash flows of Invalda INVL, AB and
Consolidated Group. Presented Consolidated Annual Report for 2021 includes a fair review of the development
and performance of the business and position of the company and the consolidated group in relation to the
description of the main risks and contingencies faced thereby.
ENCLOSED:
1. Consolidated and Company‘s Financial Statements for 2021.
2. Consolidated Annual Report for 2021.
signed with qualified electronic signature signed with qualified electronic signature
President Chief Financier
Darius Šulnis Raimondas Rajeckas
3
Translation note:
This version of the financial statements has been prepared in Lithuanian and English languages. In
all matters of interpretation of information, views or opinions, the Lithuanian language version of
financial statements takes precedence over the English language version.
CONTENTS
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS:
DETAILS OF THE COMPANY ..................................................................................................................................... 4
CONSOLIDATED AND COMPANY’S INCOME STATEMENTS ........................................................................... 5
CONSOLIDATED AND COMPANY’S STATEMENTS OF COMPREHENSIVE INCOME ................................ 6
CONSOLIDATED AND COMPANY’S STATEMENTS OF FINANCIAL POSITION ........................................... 7
CONSOLIDATED AND COMPANY’S STATEMENTS OF CHANGES IN EQUITY ............................................ 8
CONSOLIDATED AND COMPANY’S STATEMENTS OF CASH FLOWS ..........................................................10
NOTES TO THE FINANCIAL STATEMENTS ..........................................................................................................12
1. GENERAL INFORMATION ..................................................................................................................................... 12
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES ............................................................................................. 15
3. BUSINESS COMBINATIONS, INVESTMENTS INTO ASSOCIATES, DISPOSALS ............................................................ 36
4. SEGMENT INFORMATION ..................................................................................................................................... 39
5. OTHER INCOME AND EXPENSES ........................................................................................................................... 43
5.1. Net changes in fair value on financial instruments ...................................................................................................... 43
5.2. Employee benefits expenses ......................................................................................................................................... 43
5.3. Other expenses ............................................................................................................................................................ 43
6. INCOME TAX ........................................................................................................................................................ 44
7. EARNINGS PER SHARE.......................................................................................................................................... 48
8. DIVIDENDS PER SHARE ........................................................................................................................................ 49
9. PROPERTY, PLANT AND EQUIPMENT .................................................................................................................... 50
10. INTANGIBLE ASSETS AND COSTS TO OBTAIN CONTRACTS WITH CUSTOMERS ....................................................... 51
11. FINANCIAL INSTRUMENTS BY CATEGORY ............................................................................................................ 53
12. FAIR VALUE ESTIMATION .................................................................................................................................... 55
13. FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS ............................................................................ 63
14. LOANS GRANTED ................................................................................................................................................. 64
15. TRADE, OTHER RECEIVABLES AND CONTRACT ASSETS ........................................................................................ 64
16. CASH AND CASH EQUIVALENTS ........................................................................................................................... 66
17. SHARE CAPITAL, SHARE PREMIUM AND OWN SHARES .......................................................................................... 66
18. RESERVES ........................................................................................................................................................... 67
19. BORROWINGS ...................................................................................................................................................... 70
20. TRADE PAYABLES ................................................................................................................................................ 70
21. CONTRACT LIABILITIES ....................................................................................................................................... 70
22. OTHER LIABILITIES .............................................................................................................................................. 71
23. FINANCIAL RISK MANAGEMENT........................................................................................................................... 71
23.1. Financial risk factors .................................................................................................................................................. 71
23.2. Capital management .................................................................................................................................................... 74
24. COMMITMENTS AND CONTINGENCIES .................................................................................................................. 75
25. LEASE ................................................................................................................................................................. 76
26. RELATED PARTY TRANSACTIONS ......................................................................................................................... 77
27. IMPACT OF COVID-19 ........................................................................................................................................ 82
28. EVENTS AFTER THE REPORTING PERIOD............................................................................................................... 82
CONSOLIDATED MANAGEMENT REPORT ..........................................................................................................83
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
4
DETAILS OF THE COMPANY
Board of Directors
Mr. Alvydas Banys (Chairman of the Board)
Ms. Indrė Mišeikytė
Mr. Darius Šulnis
Management
Mr. Darius Šulnis (President)
Mr. Raimondas Rajeckas (Chief Financial Officer)
Address of registered office and company code
Company code 121304349
Banks
AB Šiaulių Bankas
AB SEB Bankas
Swedbank AS
Luminor Bank AS Lithuanian branch
Luminor Bank AS Latvian branch
Swedbank, AB
Auditor
KPMG Baltics, UAB
Lvovo str. 101,
Vilnius, Lithuania
The financial statements were approved and signed by the Management on 8 April 2022.
The document is signed with a qualified
electronic signature
The document is signed with a qualified
electronic signature
Mr. Darius Šulnis
Mr. Raimondas Rajeckas
President
Chief Financial Officer
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
5
Consolidated and Company’s income statements
Group
Company
Notes
2021
2020
2021
2020
Revenue from contracts with customers
4
72
35
Dividend income
4,098
7,168
Other income
32
38
Net changes in fair value of financial instruments at fair
value through profit or loss
5.1
(2,897 )
29,416
(3,020)
Employee benefits expenses
5.2
(8,407 )
(6,746 )
(378)
(467)
Funds distribution fees
(90 )
(75 )
-
-
Amortisation of costs to obtain contracts with customers
10
(361 )
(310 )
-
-
Information technology maintenance expenses
(669 )
(378 )
(7)
(13)
Depreciation and amortisation
9, 10
(848 )
(806 )
(22)
(19)
Premises rent and utilities
(159 )
(132 )
(7)
(6)
Advertising and other promotion expenses
(295 )
(359 )
-
-
Other expenses
5.3
(3,172 )
(2,452 )
(460)
(255)
Operating profit (loss)
32,744
3,461
Finance costs
(81 )
(133 )
(8)
(11)
Share of net (loss) profit of consolidated subsidiaries
accounted for using the equity method
3
6,143
1,759
Profit (loss) before income tax
38,879
5,209
Income tax income (expenses)
6
(2,116 )
(1,426)
120
NET PROFIT FOR THE YEAR
37,453
5,329
Attributable to:
Equity holders of the parent
37,453
5,329
Non-controlling interests
-
-
Basic earnings per share (in EUR)
7
3.19
0.46
Diluted earnings per share (in EUR)
7
3.13
0.45
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
6
Consolidated and Company’s statements of comprehensive income
Group
Company
2021
2020
2021
2020
NET PROFIT FOR THE YEAR
37,453
5,329
Net other comprehensive income that may be
subsequently reclassified to profit or loss
-
-
Net other comprehensive income not to be reclassified to
profit or loss
-
-
Other comprehensive income for the year, net of tax
-
-
TOTAL COMPREHENSIVE INCOME FOR THE YEAR,
NET OF TAX
37,453
5,329
Attributable to:
Equity holders of the parent
37,453
5,329
Non-controlling interests
-
-
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
7
Consolidated and Company’s statements of financial position
Group
Company
Notes
As at 31
December
2021
As at 31
December
2020
As at 31
December
2021
As at 31
December
2020
ASSETS
Non-current assets
Property, plant and equipment
9
95
95
Intangible assets and costs to obtain contracts
10
-
-
Investments into subsidiaries
1, 12, 3
50,470
27,479
Investments into associates
1, 12, 3
22,481
26,615
Financial assets at fair value through profit or loss
12, 13
47,887
29,548
Deferred tax asset
6
-
-
Total non-current assets
120,933
83,737
Current assets
Trade, other receivables and contract assets
15
433
882
Prepaid income tax
-
17
Prepayments and deferred charges
38
11
Financial assets at fair value through profit or loss
12, 13
3,609
-
Cash and cash equivalents
16
716
762
Total current assets
4,796
1,672
TOTAL ASSETS
125,729
85,409
EQUITY AND LIABILITIES
Equity
Share capital
1, 17
3,474
3,456
Own shares
17
(929 )
(929 )
(929)
(929)
Share premium
5,033
5,033
Reserves
18
13,490
13,147
Retained earnings
100,139
62,450
Equity attributable to equity holders of the parent
121,207
83,157
Non-controlling interests
-
-
Total equity
121,207
83,157
Liabilities
Non-current liabilities
Lease liabilities
25
76
81
Deferred tax liability
6
2,902
1,377
Contract liabilities
21
-
-
Other non-current liabilities
22
-
-
Total non-current liabilities
2,978
1,458
Current liabilities
Borrowings
19
-
28
Lease liabilities
25
24
17
Trade payables
20
50
3
Income tax payable
-
-
Advances received
700
-
Provisions
-
-
Contract liabilities
21
-
-
Other current liabilities
22
770
746
Total current liabilities
1,544
794
Total liabilities
4,522
2,252
TOTAL EQUITY AND LIABILITIES
125,729
85,409
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
8
Consolidated and Company’s statements of changes in equity
Equity attributable to equity holders of the parent
Reserves
Group
Notes
Share
capital
Own
shares
Share
premium
Legal and
other reserves
Reserve for
acquisition of own
shares
Retained
earnings
Subtotal
Non-
controlling
interests
Total
equity
Balance as at 1 January 2020
(1,248 )
Net profit for the year 2020
Total comprehensive income for the
year
Changes in reserves
18
(110 )
Disposals of own shares (share options
exercised)
17
(304 )
Share-based payments
18
Dividends approved
8
(9,288 )
(9,288 )
(9,288 )
Dividends to non-controlling interests of
subsidiaries
(76 )
(76 )
Total transactions with owners of the
Company, recognised directly in
equity
(304 )
(9,398 )
(8,948 )
(76 )
(9,024 )
Balance as at 31 December 2020
(929 )
Net profit for the year 2021
Total comprehensive income for the
year
Changes in reserves
18
(90 )
Increase of share capital (share options
exercised)
17
(5 )
Share-based payments
18
Transfer from share-based payments
reserve to retained earnings (share
options exercised)
(236 )
Dividends to non-controlling interests of
subsidiaries
(78 )
(78 )
Total transactions with owners of the
Company, recognised directly in
equity
(78 )
Balance as at 31 December 2021
(929 )
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
9
Consolidated and Company’s statements of changes in equity (cont’d)
Reserves
Company
Notes
Share capital
Own shares
Share premium
Legal and other
reserves
Reserve for
acquisition of own
shares
Retained earnings
Total
Balance as at 1 January 2020
3,456
(1,248)
5,033
2,005
11,121
66,409
86,776
Net profit for the year 2020
-
-
-
-
-
5,329
5,329
Total comprehensive income for the
year
-
-
-
-
-
5,329
5,329
Share-based payments
18
-
-
-
325
-
-
325
Disposals of own shares (share options
exercised)
17
-
319
-
-
(304)
-
15
Dividends approved
8
-
-
-
-
-
(9,288)
(9,288)
Total transactions with owners of the
Company, recognised directly in
equity
-
319
-
325
(304)
(9,288)
(8,948)
Balance as at 31 December 2020
3,456
(929)
5,033
2,330
10,817
62,450
83,157
Net profit for the year 2021
-
-
-
-
-
37,453
37,453
Total comprehensive income for the
year
-
-
-
-
-
37,453
37,453
Share-based payments
18
-
-
-
584
-
-
584
Increase of share capital (share options
exercised)
17
18
-
-
(5)
-
-
13
Transfer from share-based payments
reserve to retained earnings (share
options exercised)
-
-
-
(236)
-
236
-
Total transactions with owners of the
Company, recognised directly in
equity
18
-
-
343
-
236
597
Balance as at 31 December 2021
3,474
(929)
5,033
2,673
10,817
100,139
121,207
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
10
Consolidated and Company’s statements of cash flows
Group
Company
Notes
2021
2020
2021
2020
Cash flows from (to) operating activities
Net profit for the year
37,453
5,329
Adjustment to reconcile result after tax to net cash flows:
Non-cash:
Depreciation and amortisation including amortisation of
costs to obtain contracts with customers
9, 10
22
19
(Gain) on disposal of property, plant and equipment
(3 )
-
-
Realized and unrealized loss (gain) on investments
5.1
(33,572 )
(29,416)
3,020
Share of net (loss) profit of consolidated subsidiaries
accounted for using the equity method
(6,143)
(1,759)
Interest income
(31 )
(26 )
(31)
(25)
Interest expenses
8
11
Income tax (income) expenses
6
(44 )
1,426
(120)
Other impairment
-
-
Change in provisions
(100 )
-
-
Share-based payments
18
29
27
Dividend income
(4,119 )
(7,168 )
(4,098)
(7,168)
Other non-cash expenses
-
13
(750)
(653)
Working capital adjustments:
Decrease (increase) in trade, other receivables and
contract assets
(3,139 )
57
66
Decrease (increase) in other current assets
(177 )
(27)
-
Increase (decrease) in trade payables
(157 )
28
(21)
Increase (decrease) in contract and other liabilities
119
223
Cash flows from (to) operating activities
(573)
(385)
Income tax paid
(208 )
(158 )
-
-
Net cash flows from (to) operating activities
(573)
(385)
(cont’d on the next page)
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
11
Consolidated and Company’s statements of cash flows (cont’d)
Group
Company
Notes
2021
2020
2021
2020
Cash flows from (to) investing activities
Acquisition of non-current assets (intangible and property,
plant and equipment)
(271 )
(158 )
(1)
(5)
Proceeds from sale of non-current assets (intangible and
property, plant and equipment)
-
-
Costs to obtain contracts with customers
(455 )
(426 )
-
-
Acquisition and establishment of subsidiaries, net of cash
acquired for consolidated subsidiaries
3
(15 )
(8,800)
-
Proceeds from sales of unconsolidated subsidiaries and
redeemed convertible bonds
3
1,344
-
Acquisition of associates
3
(25 )
-
(25)
Proceeds from sales of associates
3
5,353
294
Acquisition of financial assets at fair value through profit or
loss (except held-for-trading)
(11,204 )
(7,038 )
(2,044)
(5,166)
Sale of financial assets at fair value through profit or loss
(except held-for-trading)
1,417
4,343
Dividends received
5,965
8,643
Loans granted
(2,687 )
(40 )
(2,687)
(40)
Repayment of granted loans
-
1,500
Interest received
26
19
Net cash flows from (to) investing activities
(941 )
573
9,563
Cash flows from (to) financing activities
Cash flows related to company shareholders:
Issue of shares
17
13
-
Dividends paid to equity holders of the parent
(33 )
(9,038 )
(33)
(9,038)
Dividends paid to non-controlling interests
(78 )
(76 )
-
-
Disposal of own shares
17
-
15
(98 )
(9,099 )
(20)
(9,023)
Cash flows related to other sources of financing:
Proceeds from borrowings
-
27
Repayment of borrowings
-
-
Payments of lease liabilities
(294 )
(250 )
(18)
(14)
Interest paid
(81 )
(132 )
(8)
(10)
(375 )
(355 )
(26)
3
Net cash flows to financing activities
(473 )
(9,454 )
(46)
(9,020)
Impact of currency exchange on cash and cash
equivalents
(13 )
-
(13)
Net increase (decrease) in cash and cash equivalents
(46)
145
Cash and cash equivalents at the beginning of the year
16
762
617
Cash and cash equivalents at the end of the year
16
716
762
(the end)
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
12
Notes to the financial statements
1. General information
AB Invalda INVL (hereinafter the Company) is a public limited liability company registered in the Republic of Lithuania on 20 March
1992. The address of its registered office is:
Gynėjų str. 14,
Vilnius,
Lithuania.
The Company is incorporated and domiciled in Lithuania. AB Invalda INVL is one of the leading asset management groups and
investments are in asset management, agriculture, facility management, real estate, bank activities. Asset management segment
provides investment-related services to investors and third parties. The entities of the asset management segment manage
pension, bond and equity investments funds, alternative investments (private equity, real assets and private debt), individual
portfolios. Bond and equity investment funds, alternative and private equity funds and closed-ended investment companies are
referred as collective investment undertakings.
In respect of each unconsolidated business the Company may also participate in the following investment-related activities, either
directly or through a consolidated subsidiary, if these activities are undertaken to maximize the investment return (capital
appreciation or investment income) from its investees and do not represent a separate substantial business activity or a separate
substantial source of income to the investment entity. The Company does not earn any management fees from unconsolidated
subsidiaries.
The Company’s shares are traded on the Baltic Secondary List of Nasdaq Vilnius. As at 31 December 2021 and 31 December
2020 the shareholders of the Company were:
2021
2020
Number of
shares held
Percentage
(%)
Number of
shares held
Percentage
(%)
UAB Lucrum Investicija (sole shareholder Mr. Darius
Šulnis)
3,181,702
26.56
2,803,492
23.52
UAB LJB Investments (controlling shareholder Mr.
Alvydas Banys)
3,098,196
25.87
3,300,645
27.69
Mrs. Irena Ona Mišeikienė
3,006,834
25.10
3,182,595
26.70
Mr. Alvydas Banys
910,875
7.60
910,875
7.64
Ms. Indrė Mišeikytė
236,867
1.98
236,867
1.99
The Company (own shares)
229,541
1.92
229,541
1.93
Other minor shareholders
1,314,558
10.97
1,254,884
10.53
Total
11,978,573
100.00
11,918,899
100.00
The shareholders of the Company – Mr. Alvydas Banys, UAB LJB Investments, Mrs. Irena Ona Mišeikienė, Ms. Indrė Mišeikytė,
Mr. Darius Šulnis and UAB Lucrum Investicija – have signed the agreement on the implementation of a long-term corporate
governance policy. For the purpose of developing and implementing the long-term corporate governance policy the above
mentioned shareholders agreed to act in the interests of the Company. In order to implement this, the shareholders agreed in
advance coordinate their opinion on the issues considered at the general meeting of shareholders of the Company. The agreement
shall not be interpreted to mean an undertaking of the shareholders to vote unanimously on decisions taken at the general
meetings of shareholders of the Company. The sole purpose of the agreement is for shareholders to make known their position
and find out the position of the other shareholders in advance regarding the agenda items of the general meetings of shareholders
of the Company related to the implementation of the long-term corporate governance strategy of the Company and for the aim of
achieving the aims mentioned above to coordinate potential decisions in advance.
All the shares of the Company are ordinary shares with the par value of EUR 0.29 each and were fully paid as at 31 December
2021 and 2020. Subsidiaries and associates did not hold any shares of the Company as at 31 December 2021 and 2020.
As at 31 December 2021 the number of employees of the Group was 459 (as at 31 December 2020 – 537). As at 31 December
2021 the number of employees of the Company was 7 (as at 31 December 2020 – 7).
According to the Law on Companies of Republic of Lithuania, the annual financial statements prepared by the Management are
authorised by the General Shareholders’ meeting. The shareholders hold the power not to approve the annual financial statements
and the right to request new financial statements to be prepared.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
13
1 General information (cont’d)
The Group consists of the Company and the following consolidated directly and indirectly owned subsidiaries (hereinafter the
Group).
Name
Country of
incorporation
and place of
business
Effective ownership directly/indirectly
held by the Company/Group (%)
Nature of business
As at 31
December 2021
As at 31
December 2020
Asset management segment:
UAB INVL Asset Management
Lithuania
100.00
100.00
Pension and investments
funds, alternative
investments, clients’
portfolio management
IPAS INVL Asset Management
Latvia
100.00
100.00
Pension and investments
funds, clients’ portfolio
management
AS INVL Atklātais Pensiju Fonds*
Latvia
100.00
100.00
3
rd
pillar pension funds
management
UAB FMĮ INVL Finasta
Lithuania
100.00
100.00
Financial brokerage
UAB Mundus*
Lithuania
51.01
51.01
Private debt investments
funds management
UAB INVL Farmland Management
Lithuania
100.00
100.00
Land administration services
UAB Invalda INVL Investments
Lithuania
100.00
100.00
Dormant
INVL Life UAB
Lithuania
100.00
-
Future life insurance activities
INVL LUX GP1 S.à r.l.*
,
**
Luxembourg
100.00
100.00
General partner of managed
entity -fund
*The entity is owned by the Company indirectly.
**Due to immaterial to the financial position, performance and cash flows of the Group, the subsidiary was not consolidated.
As at 31 December 2021 and 2020 the Group has also the following unconsolidated subsidiaries, which measured at fair value
through profit or loss.
Name
Country of
incorporation
and place of
business
Effective ownership directly/indirectly
held by the Company/Group (%)
Nature of business
As at 31
December 2021
As at 31
December 2020
Facility management activities:
UAB Inservis
Lithuania
100.00
100.00
Facilities management
UAB IPP Integracijos Projektai*
Lithuania
100.00
100.00
Dormant
UAB Priemiestis*
Lithuania
100.00
100.00
Facilities management
UAB Jurita*
Lithuania
100.00
100.00
Facilities management
UAB Informacinio Verslo Paslaugų
Įmonė*
Lithuania
-
88.70
Payments administration for
public utilities
SIA Inservis*
Latvia
100.00
100.00
Facilities management
UAB Įmonių Grupė Inservis
Lithuania
100.00
100.00
Investment into facilities
management entities
Other activities:
UAB Kelio Ženklai
Lithuania
-
100.00
Road signs production, wood
manufacturing
VšĮ Iniciatyvos Fondas
Lithuania
100.00
100.00
Social initiatives activities
UAB Aktyvo
Lithuania
54.55
54.55
Management of bad debt
UAB Aktyvus Valdymas
Lithuania
100.00
100.00
Dormant
UAB Cedus Invest
Lithuania
100.00
100.00
Investment into agriculture
entity UAB Litagra (investment
entity)
UAB MGK Invest
Lithuania
100.00
100.00
Dormant
UAB MBGK*
Lithuania
100.00
100.00
Dormant
UAB RPNG
Lithuania
100.00
100.00
Dormant
UAB Regenus
Lithuania
100.00
100.00
Dormant
UAB Consult Invalda
Lithuania
100.00
100.00
Dormant
UAB Cedus
Lithuania
100.00
100.00
Dormant
UAB MD Partners
Lithuania
51.37
51.37
Indirectly investment into
MAIB bank (investment entity)
*These entities are owned indirectly by the Company as at 31 December 2021 and/or 2020.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
14
1 General information (cont’d)
The Group has not any significant restriction on ability to access or use its assets and settle its liabilities. The Company has not
any significant restriction on the ability of an unconsolidated subsidiary to transfer funds to the Company.
If the unconsolidated subsidiary has liquidity difficulties, the Company grants loans to the subsidiary after analysis of its needs.
The Company has not any contractual commitments to provide financial support to unconsolidated subsidiary. In 2021 and 2020
the Company has granted EUR 55 thousand and EUR 40 thousand of loans to maintain the activity of the unconsolidated
subsidiaries, respectively.
As at 31 December 2021 the Group has the following associates, which measured at fair value through profit or loss:
Name
Country of
incorporation and
place of business
Effective ownership
directly/indirectly held by
the Company/Group (%)
Nature of business
Agriculture activities:
UAB Litagra*
Lithuania
48.81
The primary crop and
livestock (milk) production,
feed production and poultry
farming
Real estate activities:
Special Closed-Ended Type Real Estate
Investment Company INVL Baltic Real
Estate
Lithuania
23.43
Real estate owner and
lessor
*The entity is owned indirectly by the Company as at 31 December 2021.
As at 31 December 2020 the Group has the following associates, which measured at fair value through profit or loss:
Name
Country of
incorporation and
place of business
Effective ownership
directly/indirectly held by
the Company/Group (%)
Nature of business
Agriculture activities:
UAB Litagra*
Lithuania
48.81
The primary crop and
livestock (milk) production,
feed production and poultry
farming
Real estate activities:
Special Closed-Ended Type Real Estate
Investment Company INVL Baltic Real
Estate**
Lithuania
32.49
Real estate owner and
lessor
*The entity is owned indirectly by the Company as at 31 December 2020.
**As at 31 December 2020 the Group/the Company owned indirectly 2.46% of shares of the entity.
Through unconsolidated subsidiary UAB MD Partners the Company/the Group has indirectly invested into the largest Moldovan
bank Moldova-Agroindbank (MAIB). 41.09% shares of MAIB were acquired by entity Heim Partners Limited. UAB MD Partners
owns 37.5% of Heim Partners Limited shares and has entered into shareholders agreement with other shareholders: the European
Bank for Reconstruction and Development (37.5% of shares) (EBRD) and subsidiary of fund managed by Ukrainian private equity
manager Horizon Capital (25% of shares). All these shareholders have obtained permission of the Moldovan central bank to
indirectly acquired shares of MAIB. The Company owns 51.37% shares of UAB MD Partners. Therefore the Company effectively
owns 19.26% of economic benefits from the indirectly investments into Heim Partners Limited and 7.91% of economic benefits
from the indirectly investment into MAIB.
UAB Litagra has to receive bank consent to pay dividends as at 31 December 2021 and 2020. Special Closed-Ended Type Real
Estate Investment Company INVL Baltic Real Estate (hereinafter INVL Baltic Real Estate) has the right to pay dividends without
bank consent only if the ratio of EBITDA (earnings before interest, tax, depreciation and amortization) plus inflows from
subsidiaries (dividends or repayment of granted loan) divided by the sum of debt service costs (interest and principal repayments)
and dividends would be higher than 1.1.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
15
2. Summary of significant accounting policies
The principal accounting policies applied in preparing the Group’s and the Company’s financial statements for the year ended
31 December 2021 are as follows:
2.1. Basis of preparation
Statement of compliance
The financial statements of the Company and the consolidated financial statements of the Group have been prepared in
accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union (hereinafter the EU).
These financial statements have been prepared on a historical cost basis, except for financial assets and liabilities at fair value
through profit or loss, investments to unconsolidated subsidiaries and associates measured at fair value through profit or loss.
The financial statements are presented in thousands of euro (EUR) and all values are rounded to the nearest thousand except
when otherwise indicated. From 1 January 2015 the euro became local currency of the Republic of Lithuania.
Adoption of new and/or changed IFRSs and IFRIC interpretations
The Group has adopted the new and amended IFRS and IFRIC interpretations as of 1 January 2021:
− Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16: Interest rate benchmark (IBOR) reform – phase 2 (effective for
annual periods beginning on or after 1 January 2021);
− Amendment to IFRS 4 Insurance Contracts – deferral of IFRS 9 (effective for annual periods beginning on or after 1 January
2021);
− Amendments to IFRS 16 Covid-19-Related Rent Concessions – (effective for annual periods beginning on or after 1 January
2021).
The principal effects of these changes are as follows:
Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16: Interest rate benchmark (IBOR) reform – phase 2
The Phase 2 amendments address issues that arise from the implementation of the reforms, including the replacement of one
benchmark with an alternative one. The amendments cover the following areas:
• Accounting for changes in the basis for determining contractual cash flows as a result of IBOR reform: For instruments to
which the amortised cost measurement applies, the amendments require entities, as a practical expedient, to account for a
change in the basis for determining the contractual cash flows as a result of IBOR reform by updating the effective interest
rate using the guidance in paragraph B5.4.5 of IFRS 9. As a result, no immediate gain or loss is recognised. This practical
expedient applies only to such a change and only to the extent it is necessary as a direct consequence of IBOR reform, and
the new basis is economically equivalent to the previous basis. Insurers applying the temporary exemption from IFRS 9 are
also required to apply the same practical expedient. IFRS 16 was also amended to require lessees to use a similar practical
expedient when accounting for lease modifications that change the basis for determining future lease payments as a result
of IBOR reform.
• End date for Phase 1 relief for non contractually specified risk components in hedging relationships: The Phase 2
amendments require an entity to prospectively cease to apply the Phase 1 reliefs to a non-contractually specified risk
component at the earlier of when changes are made to the non-contractually specified risk component, or when the hedging
relationship is discontinued. No end date was provided in the Phase 1 amendments for risk components.
• Additional temporary exceptions from applying specific hedge accounting requirements: The Phase 2 amendments provide
some additional temporary reliefs from applying specific IAS 39 and IFRS 9 hedge accounting requirements to hedging
relationships directly affected by IBOR reform.
• Additional IFRS 7 disclosures related to IBOR reform: The amendments require disclosure of: (i) how the entity is managing
the transition to alternative benchmark rates, its progress and the risks arising from the transition; (ii) quantitative information
about derivatives and non-derivatives that have yet to transition, disaggregated by significant interest rate benchmark; and
(iii) a description of any changes to the risk management strategy as a result of IBOR reform.
The amendments are not relevant for the Group and the Company.
Amendment to IFRS 4 Insurance Contracts – deferral of IFRS 9
The fixed expiry date of the temporary exemption from applying IFRS 9 in IFRS 4 has been deferred to annual reporting periods
beginning on or after 1 January 2023. The amendment is not relevant for the Group and the Company.
Amendment to IFRS 16 Leases: Covid-19-Related Rent Concessions
The amendment extended the relief in the form of an optional exemption from assessing whether a rent concession related to
COVID-19 is a lease modification by one year to cover rent concessions that reduce only lease payments due on or before 30
June 2022. The amendment is to be applied retrospectively in accordance with IAS 8, but lessees are not required to restate prior
period figures or to provide the disclosure under paragraph 28(f) of IAS 8. The amendment is not relevant for the Group and the
Company.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
16
2 Summary of significant accounting policies (cont’d)
2.1 Basis of preparation (cont’d)
Standards adopted by the EU but not yet effective
Annual Improvements to IFRSs 2018-2020 cycle (amendments to IFRS 1 First-time Adoption of International Financial Reporting
Standards, IFRS 9 Financial Instruments , IFRS 16 Leases and IAS 41 Agriculture) and narrow scope amendments to IAS 16
Property, Plant and Equipment, IAS 37 Provisions, Contingent Liabilities and Contingent Assets and IFRS 3 Business
Combinations (effective for annual periods beginning on or after 1 January 2022).
The amendment to IAS 16 prohibits an entity from deducting from the cost of an item of PPE any proceeds received from selling
items produced while the entity is preparing the asset for its intended use. The proceeds from selling such items, together with
the costs of producing them, are now recognised in profit or loss. An entity will use IAS 2 to measure the cost of those items.
Cost will not include depreciation of the asset being tested because it is not ready for its intended use. The amendment to IAS
16 also clarifies that an entity is ‘testing whether the asset is functioning properly’ when it assesses the technical and physical
performance of the asset. The financial performance of the asset is not relevant to this assessment. An asset might therefore be
capable of operating as intended by management and subject to depreciation before it has achieved the level of operating
performance expected by management.
The amendment to IAS 37 clarifies the meaning of ‘costs to fulfil a contract’. The amendment explains that the direct cost of
fulfilling a contract comprises the incremental costs of fulfilling that contract; and an allocation of other costs that relate directly to
fulfilling. The amendment also clarifies that, before a separate provision for an onerous contract is established, an entity recognises
any impairment loss that has occurred on assets used in fulfilling the contract, rather than on assets dedicated to that contract.
IFRS 3 was amended to refer to the 2018 Conceptual Framework for Financial Reporting, in order to determine what constitutes
an asset or a liability in a business combination. Prior to the amendment, IFRS 3 referred to the 2001 Conceptual Framework for
Financial Reporting. In addition, a new exception in IFRS 3 was added for liabilities and contingent liabilities. The exception
specifies that, for some types of liabilities and contingent liabilities, an entity applying IFRS 3 should instead refer to IAS 37 or
IFRIC 21, rather than the 2018 Conceptual Framework. Without this new exception, an entity would have recognised some
liabilities in a business combination that it would not recognise under IAS 37. Therefore, immediately after the acquisition, the
entity would have had to derecognise such liabilities and recognise a gain that did not depict an economic gain. It was also
clarified that the acquirer should not recognise contingent assets, as defined in IAS 37, at the acquisition date.
The amendment to IFRS 9 addresses which fees should be included in the 10% test for derecognition of financial liabilities. Costs
or fees could be paid to either third parties or the lender. Under the amendment, costs or fees paid to third parties will not be
included in the 10% test.
Illustrative Example 13 that accompanies IFRS 16 was amended to remove the illustration of payments from the lessor relating to
leasehold improvements. The reason for the amendment is to remove any potential confusion about the treatment of lease
incentives.
IFRS 1 allows an exemption if a subsidiary adopts IFRS at a later date than its parent. The subsidiary can measure its assets
and liabilities at the carrying amounts that would be included in its parent’s consolidated financial statements, based on the
parent’s date of transition to IFRS, if no adjustments were made for consolidation procedures and for the effects of the business
combination in which the parent acquired the subsidiary. IFRS 1 was amended to allow entities that have taken this IFRS 1
exemption to also measure cumulative translation differences using the amounts reported by the parent, based on the parent’s
date of transition to IFRS. The amendment to IFRS 1 extends the above exemption to cumulative translation differences, in order
to reduce costs for first-time adopters. This amendment will also apply to associates and joint ventures that have taken the same
IFRS 1 exemption.
The requirement for entities to exclude cash flows for taxation when measuring fair value under IAS 41 was removed. This
amendment is intended to align with the requirement in the standard to discount cash flows on a post-tax basis.
The Group and the Company are currently assessing the impact of the amendments on their financial statements, but are not
expecting that impact would be material.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
17
2 Summary of significant accounting policies (cont’d)
2.1 Basis of preparation (cont’d)
Standards adopted by the EU but not yet effective (cont’d)
Amendments to IAS 1 and IFRS Practice Statement 2: Disclosure of Accounting policies (effective for annual periods beginning
on or after 1 January 2023).
IAS 1 was amended to require companies to disclose their material accounting policy information rather than their significant
accounting policies. The amendment provided the definition of material accounting policy information. The amendment also
clarified that accounting policy information is expected to be material if, without it, the users of the financial statements would be
unable to understand other material information in the financial statements. The amendment provided illustrative examples of
accounting policy information that is likely to be considered material to the entity’s financial statements. Further, the amendment
to IAS 1 clarified that immaterial accounting policy information need not be disclosed. However, if it is disclosed, it should not
obscure material accounting policy information. To support this amendment, IFRS Practice Statement 2, ‘Making Materiality
Judgements’ was also amended to provide guidance on how to apply the concept of materiality to accounting policy disclosures.
The Group and the Company are currently assessing the impact of the amendments on their financial statements.
Amendments to IAS 8: Definition of Accounting Estimates (effective for annual periods beginning on or after 1 January 2023).
The amendments to IAS 8 clarified how companies should distinguish changes in accounting policies from changes in accounting
estimates. The Group and the Company are currently assessing the impact of the amendments on their financial statements.
IFRS 17 Insurance Contracts and amendments to IFRS 17 (effective for annual periods beginning on or after 1 January 2023).
IFRS 17 replaces IFRS 4, which has given companies dispensation to carry on accounting for insurance contracts using existing
practices. As a consequence, it was difficult for investors to compare and contrast the financial performance of otherwise similar
insurance companies. IFRS 17 is a single principle-based standard to account for all types of insurance contracts, including
reinsurance contracts that an insurer holds. The standard requires recognition and measurement of groups of insurance contracts
at: (i) a risk-adjusted present value of the future cash flows (the fulfilment cash flows) that incorporates all of the available
information about the fulfilment cash flows in a way that is consistent with observable market information; plus (if this value is a
liability) or minus (if this value is an asset) (ii) an amount representing the unearned profit in the group of contracts (the contractual
service margin). Insurers will be recognising the profit from a group of insurance contracts over the period they provide insurance
coverage, and as they are released from risk. If a group of contracts is or becomes loss-making, an entity will be recognising the
loss immediately.
The amendments include a number of clarifications intended to ease implementation of IFRS 17, simplify some requirements of
the standard and transition. The amendments relate to eight areas of IFRS 17, and they are not intended to change the
fundamental principles of the standard. The following amendments to IFRS 17 were made:
• Effective date: The effective date of IFRS 17 (incorporating the amendments) has been deferred by two years to annual
reporting periods beginning on or after 1 January 2023.
• Expected recovery of insurance acquisition cash flows: An entity is required to allocate part of the acquisition costs to related
expected contract renewals, and to recognise those costs as an asset until the entity recognises the contract renewals.
Entities are required to assess the recoverability of the asset at each reporting date, and to provide specific information about
the asset in the notes to the financial statements.
• Contractual service margin attributable to investment services: Coverage units should be identified, considering the quantity
of benefits and expected period of both insurance coverage and investment services, for contracts under the variable fee
approach and for other contracts with an ‘investment-return service’ under the general model. Costs related to investment
activities should be included as cash flows within the boundary of an insurance contract, to the extent that the entity performs
such activities to enhance benefits from insurance coverage for the policyholder.
• Reinsurance contracts held – recovery of losses: When an entity recognises a loss on initial recognition of an onerous group
of underlying insurance contracts, or on addition of onerous underlying contracts to a group, an entity should adjust the
contractual service margin of a related group of reinsurance contracts held and recognise a gain on the reinsurance contracts
held. The amount of the loss recovered from a reinsurance contract held is determined by multiplying the loss recognised on
underlying insurance contracts and the percentage of claims on underlying insurance contracts that the entity expects to
recover from the reinsurance contract held. This requirement would apply only when the reinsurance contract held is
recognised before or at the same time as the loss is recognised on the underlying insurance contracts.
• Other amendments: Other amendments include scope exclusions for some credit card (or similar) contracts, and some loan
contracts; presentation of insurance contract assets and liabilities in the statement of financial position in portfolios instead of
groups; applicability of the risk mitigation option when mitigating financial risks using reinsurance contracts held and non-
derivative financial instruments at fair value through profit or loss; an accounting policy choice to change the estimates made
in previous interim financial statements when applying IFRS 17; inclusion of income tax payments and receipts that are
specifically chargeable to the policyholder under the terms of an insurance contract in the fulfilment cash flows; and selected
transition reliefs and other minor amendments.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
18
2 Summary of significant accounting policies (cont’d)
2.1 Basis of preparation (cont’d)
Standards adopted by the EU but not yet effective (cont’d)
IFRS 17 Insurance Contracts and amendments to IFRS 17 (cont’d)
The Group and the Company are currently assessing the impact of the new standard on their financial statements. The impact
would be material after completion of acquisition of life insurance business in Baltic states from Finnish life insurance company
Mandatum Life.
Standards not yet adopted by the EU
Amendments to IAS 1: Classification of liabilities as current or non-current (effective for annual periods beginning on or after 1
January 2023 once adopted by the EU).
These narrow scope amendments clarify that liabilities are classified as either current or non-current, depending on the rights that
exist at the end of the reporting period. Liabilities are non-current if the entity has a substantive right, at the end of the reporting
period, to defer settlement for at least twelve months. The guidance no longer requires such a right to be unconditional.
Management’s expectations whether they will subsequently exercise the right to defer settlement do not affect classification of
liabilities. The right to defer only exists if the entity complies with any relevant conditions as of the end of the reporting period. A
liability is classified as current if a condition is breached at or before the reporting date even if a waiver of that condition is obtained
from the lender after the end of the reporting period. Conversely, a loan is classified as non-current if a loan covenant is breached
only after the reporting date. In addition, the amendments include clarifying the classification requirements for debt a company
might settle by converting it into equity. ‘Settlement’ is defined as the extinguishment of a liability with cash, other resources
embodying economic benefits or an entity’s own equity instruments. There is an exception for convertible instruments that might
be converted into equity, but only for those instruments where the conversion option is classified as an equity instrument as a
separate component of a compound financial instrument. The amendments were issued in January 2020 with an original effective
date 1 January 2022. However, in response to the Covid-19 pandemic, the effective date was deferred by one year to provide
companies with more time to implement classification changes resulting from the amended guidance. The Group and the
Company are currently assessing the impact of the amendments on their financial statements, but are not expecting that impact
would be material.
Amendments to IAS 12: Deferred tax related to assets and liabilities arising from a single transaction (effective for annual periods
beginning on or after 1 January 2023 once adopted by the EU).
The amendments to IAS 12 specify how to account for deferred tax on transactions such as leases and decommissioning
obligations. In specified circumstances, entities are exempt from recognising deferred tax when they recognise assets or liabilities
for the first time. Previously, there had been some uncertainty about whether the exemption applied to transactions such as leases
and decommissioning obligations – transactions for which both an asset and a liability are recognised. The amendments clarify
that the exemption does not apply and that entities are required to recognise deferred tax on such transactions. The amendments
require companies to recognise deferred tax on transactions that, on initial recognition, give rise to equal amounts of taxable and
deductible temporary differences. The Group and the Company are accounted for leases consistent with the new requirements,
Therefore, the Group and the Company would be not affected by the amendments.
Amendments to IFRS 17: Transition option to insurers applying IFRS 17 (effective for annual periods beginning on or after 1
January 2023 once adopted by the EU).
The amendment to the transition requirements in IFRS 17 provides insurers with an option aimed at improving the usefulness of
information to investors on initial application of IFRS 17. The amendment relates to insurers’ transition to IFRS 17 only and does
not affect any other requirements in IFRS 17. The transition requirements in IFRS 17 and IFRS 9 apply at different dates and will
result in the following one-time classification differences in the comparative information presented on initial application of IFRS
17: accounting mismatches between insurance contract liabilities measured at current value and any related financial assets
measured at amortised cost; and if an entity chooses to restate comparative information for IFRS 9, classification differences
between financial assets derecognised in the comparative period (to which IFRS 9 will not apply) and other financial assets (to
which IFRS 9 will apply). The amendment will help insurers to avoid these temporary accounting mismatches and, therefore, will
improve the usefulness of comparative information for investors. It does this by providing insurers with an option for the
presentation of comparative information about financial assets. When initially applying IFRS 17, entities would, for the purpose of
presenting comparative information, be permitted to apply a classification overlay to a financial asset for which the entity does not
restate IFRS 9 comparative information. The transition option would be available, on an instrument-by-instrument basis; allow an
entity to present comparative information as if the classification and measurement requirements of IFRS 9 had been applied to
that financial asset, but not require an entity to apply the impairment requirements of IFRS 9; and require an entity that applies
the classification overlay to a financial asset to use reasonable and supportable information available at the transition date to
determine how the entity expects that financial asset to be classified applying IFRS 9. The Group and the Company are currently
assessing the impact of the amendments on their financial statements. The impact would be material after completion of
acquisition of life insurance business in Baltic states from Finnish life insurance company Mandatum Life.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
19
2 Summary of significant accounting policies (cont’d)
2.1 Basis of preparation (cont’d)
Standards not yet adopted by the EU (cont’d)
The adoption of the following new standards and amendments are postponed by the EU indefinitely:
− IFRS 14 Regulatory Deferral Accounts (effective for annual periods beginning on or after 1 January 2016 once adopted by the
EU)
− Amendments to IFRS 10 and IAS 28: Sale or Contribution of Assets between an Investor and its Associate or Joint Venture
(effective for annual periods beginning on or after a date to be determined by the IASB once adopted by the EU)
The Group and the Company have not yet analysed impact of them to their financial statements.
2.2. Investment entity and consolidated financial statements
Investment entity
The Company has multiple unrelated investors and holds multiple investments. Ownership interests in the Company are in the
form of equity securities issued by the Company – ordinary registered shares. In the management’s opinion, the Company meets
the definition of an investment entity as the following conditions exist:
(i) funds are obtained from investors for the purpose of providing them with investment management services;
(ii) it is committed to investors that its business purpose in to invest funds solely for capital appreciation, investment income,
or both; and
(iii) it is measured and evaluated the performance of substantially all of its investments on a fair value basis.
The Board of Directors approved exit strategies for the Company’s investments, which has not definitely maturity terms. The
Company and the Group also invest to the collective investment undertakings, which have limited life or is traded on exchange or
is open-ended fund with right to redeem on daily basis.
Each Company’s investments are fair valued and such fair value information is provided both to the Company’s investors on
reporting date and also for internal management reporting purposes.
In addition, management has assessed that the following characteristics further support investment entity categorization:
Company holds several investments itself in the investment funds managed by management company owned by the Company
(this management company is providing investment-related services and is consolidated), investments in the funds are held by
several investors, the investors are not related parties and the investments are held mostly in form of equity.
An investment entity may provide investment-related services, either directly or through a subsidiary, to third parties as well as to
its investors, even if those activities are substantial to the entity, subject to the entity continuing to meet the definition of an
investment entity. An investment entity may also participate in the following investment-related activities, either directly or through
a subsidiary, if these activities are undertaken to maximize the investment return (capital appreciation or investment income) from
its investees and do not represent a separate substantial business activity or a separate substantial source of income to the
investment entity:
(a) providing management services and strategic advice to an investee; and
(b) providing financial support to an investee, such as a loan, capital commitment or guarantee.
The management has assessed that investment-related services provided to third parties is ancillary to its core investing activities
and therefore does not change its business purpose therefore the Company meets the definition of an investment entity.
Subsidiaries
The Company has two types of subsidiaries. One type of subsidiaries are controlled subsidiary investments (hereinafter
unconsolidated subsidiary). They are measured at fair value through profit or loss and not consolidated, in accordance with IFRS
10. The fair value of controlled subsidiary investments is determined on a consistent basis to all other investments measured at
fair value through profit or loss, and as described in the Note 2.12 below.
The other type of subsidiaries provide investment-related services (investment advisory services, investment management) to the
investors and third parties (hereinafter consolidated subsidiary). They are not themselves investment entities. The Company
considers whether providing services to third parties is ancillary to its core investing activities, when assesses whether it qualifies
as an investment entity. These subsidiaries that provide services that are related to the entity’s investment activities are
consolidated.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
20
2 Summary of significant accounting policies (cont’d)
2.2 Investment entity and consolidated financial statements (cont’d)
Associates
An associate is an entity, over which the Company has significant influence and that is neither a subsidiary nor an interest in a
joint venture. Investments that are held as part of the Company’s investment portfolio are carried at fair value even though the
Company may have significant influence over those companies. This treatment is permitted by IAS 28 ‘Investments in associates
and joint ventures’ as exception from applying the equity method.
2.3. Basis of consolidation
The consolidated financial statements comprise the financial statements of the Company and its consolidated subsidiaries that
provide services that are related to the entity’s investment activities. The financial statements of the consolidated subsidiaries are
prepared for the same reporting year as the parent company, using consistent accounting policies.
Consolidated subsidiaries are all entities (including structured entities) over which the group has control and that provide services
that are related to the entity’s investment activities. The Group controls an entity when the group 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.
Consolidated subsidiaries are fully consolidated from the date of acquisition, being the date on which the Group obtains control,
and continue to be consolidated until the date that such control ceases. All intra-group balances, transactions, income and
expenses, unrealised gains and losses and dividends resulting from intra-group transactions that are recognised in assets, are
eliminated in full.
Some Group’s consolidated subsidiaries managed collective investment undertakings and pension funds. The Group analyse
whether it is acting primarily as a principal (therefore, controls entities or funds) or as an agent (therefore, do not control them) in
exercising its power over the funds. Fund managers generally have power over the relevant activities of the funds that they
manage through their exercise of delegated power, and exposure to variability of returns through incentive fees and/or co-
investment. Therefore, the link between power and returns is usually key for fund managers assessing whether a fund manager
has control over the fund. Aggregate economic interests and investors held rights, including kick-out rights, are assessed together
to decide whether the Group have control over managed entities and funds.
Non-controlling interest is the equity in a consolidated subsidiary not attributable, directly or indirectly, to a parent and is presented
separately in the consolidated income statement and within equity in the consolidated statement of financial position, separately
from parent shareholders’ equity. The group treats transactions with non-controlling interests as transactions with equity owners
of the group. For purchases from non-controlling interests, the difference between any consideration paid and the relevant share
acquired of the carrying value of net assets of the consolidated subsidiary is recorded in equity. Gains or losses on disposals to
non-controlling interests are also recorded in equity.
Total comprehensive income (losses) within a consolidated subsidiary are attributed to the non-controlling interest even if that
results in a deficit balance.
When the Group ceases to have control of a consolidated subsidiary any retained interest in the entity is remeasured to its fair
value, with the change in carrying amount recognised in profit or loss. The fair value is the initial carrying amount for the purposes
of subsequently accounting for the retained interest as an associate or financial asset. In addition, any amounts previously
recognised in other comprehensive income in respect of that entity are accounted for as if the group had directly disposed of the
related assets or liabilities. This may mean that amounts previously recognised in other comprehensive income are reclassified
to profit or loss or retained earnings, as appropriate.
2.4. Functional and presentation currency
The financial statements are prepared in euro (EUR), which is local currency of the Republic of Lithuania, and presented in EUR
thousand. Euro is also the local currency of the Republic of Latvia. Euro is the Company’s functional currency and the Company’s
and the Group’s presentation currency. The exchange rates in relation to other currencies are set daily by the European Central
Bank and the Bank of Lithuania.
As these financial statements are presented in euro thousand, individual amounts were rounded. Due to the rounding, totals in
the tables may not add up.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
21
2 Summary of significant accounting policies (cont’d)
2.5. Property, plant and equipment
Property, plant and equipment is stated at cost, excluding the costs of day to day servicing, less accumulated depreciation and
accumulated impairment losses. Such cost includes the cost of replacing part of the plant and equipment when the cost is incurred,
if the recognition criteria are met. Replaced parts are written off. The Group and the Company have elected to present right-of-
use assets as property, plant and equipment. The right-of-use assets comprise leased properties. The accounting policy of right-
of-use assets is disclosed in Note 2.18.
The carrying values of property, plant and equipment are reviewed for impairment when events or change in circumstances
indicate that the carrying value may not be recoverable.
Depreciation is calculated using the straight-line method over the following estimated useful lives.
Leased properties (right-of-use assets)
1-4 years
Vehicles
6 years
Other non-current assets
3–6 years
The asset residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each financial year
end to ensure that they are consistent with the expected pattern of economic benefits from items in property, plant and equipment.
An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected from
its use or disposal. Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal
proceeds and the carrying amount of the asset) is included in the income statement within “other income” in the year the asset is
derecognised.
2.6. Intangible assets other than goodwill
Intangible assets are measured initially at cost. Intangible assets are recognised if it is probable that future economic benefits that
are attributable to the asset will flow to the enterprise and the cost of asset can be measured reliably. After initial recognition,
intangible assets are measured at cost less accumulated amortisation and any accumulated impairment losses. The useful lives
of intangible assets other than goodwill are assessed to be finite. Intangible assets are amortised using the straight-line method
over the best estimate of their useful lives.
Funds’ management rights
Funds’ management rights include investment, private debt investments, pension funds and portfolio of clients acquired during
asset management entities acquisition. Funds’ management rights acquired in a business combination are capitalised at the fair
value at the acquisition date and treated as an intangible asset. Following initial recognition, funds’ management rights are carried
at cost less any accumulated impairment losses. Funds’ management rights are amortised during 5 - 10 years.
Software
The costs of acquisition of new software are capitalised and treated as an intangible asset if these costs are not an integral part
of the related hardware. Software is amortised during 3-5 years.
Costs incurred in order to restore or maintain the future economic benefits that the Group and the Company expect from the
originally assessed standard of performance of existing software systems are recognised as an expense when the restoration or
maintenance work is carried out.
2.7. Business combinations and goodwill
The Group applies the acquisition method of accounting to account for business combinations. The consideration transferred for
the acquisition of a consolidated subsidiary is the fair values of the assets transferred, the liabilities incurred to the former owners
of the acquiree and the equity interests issued by the group. The consideration transferred includes the fair value of any asset or
liability resulting from a contingent consideration arrangement. Acquisition-related costs are expensed as incurred. Identifiable
assets acquired and liabilities and contingent liabilities assumed in a business combination are, with limited exceptions, measured
initially at their fair values at the acquisition date. On an acquisition-by-acquisition basis, the group recognises any non-controlling
interest in the acquiree either at fair value or at the non-controlling interest’s proportionate share of the recognised amounts of
acquiree’s identifiable net assets.
When the Group acquires a business, it assesses the financial assets and liabilities assumed for appropriate classification and
designation in accordance with the contractual terms, economic circumstances and pertinent conditions as at the acquisition date.
This includes the separation of embedded derivatives in host contracts by the acquiree.
If the business combination is achieved in stages, the acquirer’s previously held equity interest in the acquiree is remeasured to
fair value at the acquisition date through profit or loss.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
22
2 Summary of significant accounting policies (cont’d)
2.7 Business combinations and goodwill (cont’d)
Any contingent consideration to be transferred by the acquirer is recognised at fair value at the acquisition date. Subsequent
changes to the fair value of the contingent consideration, which is deemed to be an asset or liability, will be recognised in
accordance with IFRS 9 either in profit or loss or as a change to other comprehensive income. If the contingent consideration is
classified as equity, it should not be remeasured until it is finally settled within equity. In instances where the contingent
consideration does not fall within the scope of IFRS 9, it is measured in accordance with the appropriate IFRS.
The excess of the consideration transferred, the amount of any non-controlling interest in the acquiree and the acquisition-date
fair value of any previous equity interest in the acquiree over the fair value of the group’s share of the identifiable net assets
acquired is recorded as goodwill. If the total of consideration transferred, non-controlling interest recognised and previously held
interest measured is less than the fair value of the net assets of the consolidated subsidiary acquired in the case of a bargain
purchase, the difference is recognised directly in the income statement.
Following initial recognition, goodwill is measured at cost less any accumulated impairment losses. For the purpose of annual
impairment testing, goodwill acquired in a business combination is, from the acquisition date, allocated to each of the Group’s
cash generating units, or groups of cash generating units, that are expected to benefit from the synergies of the combination,
irrespective of whether other assets or liabilities of the Group are assigned to those units or groups of units. Each unit or group of
units to which the goodwill is allocated:
− represents the lowest level within the Group at which the goodwill is monitored for internal management purposes; and
− is not larger than an operating segment determined in accordance with IFRS 8 Operating Segments.
Where goodwill forms part of a cash generating unit (group of cash generating units) and part of the operation within that unit is
disposed of, the goodwill associated with the operation disposed of is included in the carrying amount of the operation when
determining the gain or loss on disposal of the operation. Goodwill disposed of in this circumstance is measured based on the
relative values of the operation disposed of and the portion of the cash generating unit retained.
2.8. Investments in subsidiaries, associates (the Company)
Investments in unconsolidated subsidiaries, associates are measured at fair value through profit or loss. Loans granted to
unconsolidated subsidiaries and associates are considered as part of investments to subsidiaries and associates. They are
measured together with equity part of investments to unconsolidated subsidiaries and associates at fair value through profit or
loss.
Interest on loans granted at fair value through profit or loss is recognised in the income statement within ‘other income’ based on
the effective interest rate.
When the fair value of investments into unconsolidated subsidiaries and associates together with loans granted to unconsolidated
subsidiaries/associates is determined, the value is split into legal components, i.e. between debt and equity instruments. The
amortised cost of loans granted is attributed to debt instruments. The remaining value is attributed to equity instruments of the
unconsolidated subsidiary.
Investments in consolidated subsidiaries are accounted for using the equity method of accounting. Under the equity method, the
investment in the consolidated subsidiary is carried in the statement of financial position at cost plus post acquisition changes in
the Company’s share of net assets of the consolidated subsidiary. Goodwill relating to a consolidated subsidiary is included in the
carrying amount of the investment and is neither amortised nor individually tested for impairment. The statement of comprehensive
income reflects the share of the results of operations of the consolidated subsidiary. Where there has been a change recognised
in the other comprehensive income of the consolidated subsidiary, the Company recognises its share of any changes and
discloses this, when applicable, in the other comprehensive income. Company’s share in the changes in the net assets of the
consolidated subsidiary that are not recognised in profit or loss or other comprehensive income (OCI) of the consolidated
subsidiary, are recognised in equity. Unrealised gains and losses (unless the transaction provides evidence of the impairment of
asset transferred) resulting from transactions between the Company and the consolidated subsidiary are eliminated to the extent
of the interest in the consolidated subsidiary.
The reporting dates of the consolidated subsidiary and the Company are identical and the consolidated subsidiary’s accounting
policies conform to those used by the Company for like transactions and events in similar circumstances. After application of the
equity method, the Company determines whether it is necessary to recognise an additional impairment loss of the Company’s
investment in its consolidated subsidiaries. The Company determines at each reporting date whether there is any objective
evidence that the investment in consolidated subsidiary is impaired. If this is the case the Company calculates the amount of
impairment as being the difference between the recoverable amount of the consolidated subsidiary and its carrying value and
recognises the amount in the statement of comprehensive income. When the Company’s share of losses in a consolidated
subsidiary equals or exceeds its interest in the consolidated subsidiary, including any other unsecured receivables, the Company
does not recognise further losses, unless it has incurred obligations or made payments on behalf of the consolidated subsidiary.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
23
2 Summary of significant accounting policies (cont’d)
2.9. Non-current assets (or disposal groups) held-for-sale and discontinued operations
Non-current assets (or disposal groups) are classified as assets held for sale when their carrying amount is to be recovered
principally through a sale transaction and a sale is considered highly probable. They are stated at the lower of carrying amount
and fair value less costs to sell if their carrying amount is to be recovered principally through a sale transaction rather than through
continuing use.
In the consolidated income statement of the reporting period, and of the comparable period of the previous year, income and
expenses from discontinued operations are reported separately from income and expenses from continuing activities as a single
amount as profit or loss after tax from discontinued operations in the income statement, even when the Group retains a non-
controlling interest in the consolidated subsidiary after the sale, e.g. consolidated subsidiary becomes an associate.
Property, plant and equipment and intangible assets once classified as held for sale are not depreciated or amortised.
When preparing the consolidated statement of income, all inter-company transactions between discontinued and continuing
operations that the Group intends to conduct after the discontinuance, are presented in continuing operation without elimination,
i.e. they are presented as if they were conducted with third parties. In this case the elimination entry is recorded in discontinued
operations. All inter-company transactions between discontinued and continuing operations that the Group does not intend to
conduct after the discontinuance, are eliminated from continuing operation.
2.10. Impairment of non-financial assets
The Group and the Company assess at each reporting date whether there is an indication that a non-financial asset (other than
deferred taxes) may be impaired. If any such indication exists, or when annual impairment testing for an asset is required, the
Group and the Company make an estimate of the asset’s recoverable amount. An asset’s recoverable amount is the higher of an
asset’s or cash generating unit’s fair value less costs to sell and its value in use and is determined for an individual asset, unless
the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. Where the
carrying amount of an asset exceeds its recoverable amount, the asset is considered impaired and is written down to its
recoverable amount. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-
tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In
determining fair value less costs to sell, an appropriate valuation model is used. Where possible, these calculations may be
corroborated by valuation multiples, quoted share prices for publicly traded consolidated subsidiaries or other available fair value
indicators.
Impairment losses are recognised in the income statement.
For assets excluding goodwill, an assessment is made at each reporting date as to whether there is any indication that previously
recognised impairment losses may no longer exist or may have decreased. If such indication exists, the Group and the Company
make an estimate of recoverable amount. A previously recognised impairment loss is reversed only if there has been a change in
the estimates used to determine the asset’s recoverable amount since the last impairment loss was recognised. If that is the case
the carrying amount of the asset is increased to its recoverable amount. That increased amount cannot exceed the carrying
amount that would have been determined, net of depreciation, had no impairment loss been recognised for the asset in prior
years. Such reversal is recognised in the income statement. Impairment losses recognised in relation to goodwill are not reversed
for subsequent increases in its recoverable amount.
The following criteria are also applied in assessing impairment of specific assets:
Goodwill
Goodwill is reviewed for impairment annually or more frequently if events or changes in circumstances indicate that the carrying
value may be impaired.
Impairment is determined for goodwill by assessing the recoverable amount of the cash generating unit (or group of cash
generating units), to which the goodwill relates. Where the recoverable amount of the cash generating unit (or group of cash-
generating units) is less than the carrying amount of the cash-generating unit (group of cash-generating units) to which goodwill
has been allocated, an impairment loss is recognised. Impairment losses relating to goodwill cannot be reversed in future periods.
The Group performs its annual impairment test of goodwill as at 31 December.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
24
2 Summary of significant accounting policies (cont’d)
2.11. Financial assets
Financial assets within the scope of IFRS 9 are classified as either financial assets at fair value through profit or loss (either
through other comprehensive income or through profit or loss) or financial assets measured at amortised cost. The classification
depends on the entity’s business model for managing the financial assets and the contractual terms of the cash flows. For assets
measured at fair value, gains and losses will either be recorded in profit or loss or in other comprehensive income. The Group and
the Company reclassify debt instruments when and only when their business model for managing those assets changes.
Financial assets are recognised when the Group and the Company become parties to the contractual provisions of the instrument.
Financial assets are derecognised when the rights to receive cash flows from the financial assets have expired or have been
transferred and the Group and the Company have transferred substantially all the risks and rewards of ownership.
All regular way purchases and sales of financial assets are recognised on the settlement date. Regular way purchases or sales
are purchases or sales of financial assets that require delivery of assets within the period generally established by regulation or
convention in the marketplace.
At initial recognition, the Group/the Company measures a financial asset at its fair value plus, in the case of a financial asset not
at fair value through profit or loss, transaction costs that are directly attributable to the acquisition of the financial asset. Transaction
costs of financial assets carried at fair value through profit or loss are expensed in profit or loss.
The Group and the Company classify their investments in debt and equity securities, and derivatives, as financial assets at fair
value through profit or loss.
Debt instruments
Assets that are held for collection of contractual cash flows where those cash flows represent solely payments of principal and
interest are measured at amortised cost. Interest income from these financial assets is calculated using the effective interest rate
method and presented as “other income” in the income statement. Any gain or loss arising on derecognition is recognised directly
in profit or loss. Impairment losses are presented as separate line item in the income statement. The Group’s and the Company’s
financial assets at amortised cost comprised trade and other receivables, cash and cash equivalents.
Assets that are held for collection of contractual cash flows and for selling the financial assets, where the assets’ cash flows
represent solely payments of principal and interest, are measured at fair value through other comprehensive income. Movements
in the carrying amount are taken through other comprehensive income, except for the recognition of impairment gains or losses,
interest income and foreign exchange gains and losses which are recognised in profit or loss. When the financial asset is
derecognised, the cumulative gain or loss previously recognised in other comprehensive income is reclassified from equity to
profit or loss and recognised in separate line item. Interest income from these financial assets is included in “other income” using
the effective interest rate method. Foreign exchange gains and losses are presented in “other income” and impairment expenses
are presented as separate line item in the income statement. The Group and the Company do not have financial assets attributed
to this group of debt instruments.
Assets that do not meet the criteria for amortised cost or at fair value through other comprehensive income are measured at fair
value through profit or loss. A gain or loss on a debt investment that is subsequently measured at fair value through profit or loss
is recognised in profit or loss and presented net within “Net changes in fair value of financial instruments at fair value through
profit or loss” in the period in which it arises. As the Company is investment entity, which business model is to evaluate and
manage investments at fair value, the debt securities, loans granted to the owned investments are measured at fair value through
profit or loss.
Equity instruments
The Group and the Company subsequently measure all equity investments at fair value through profit or loss. Changes in the fair
value of these financial assets are recognised within “Net changes in fair value of financial instruments at fair value through profit
loss” in the income statement.
Offsetting financial instruments
Financial assets and liabilities are offset and the net amount reported in the statement of financial position when there is a legally
enforceable right to offset the recognised amounts and there is an intention to settle on a net basis, or realise the asset and settle
the liability simultaneously.
2.12. Fair value estimation
The fair value of investments traded in active markets is based on quoted market prices at the close of trading, which is the date
closest to the reporting date. The fair value of investments that are not traded in active markets is determined by using valuation
techniques. Such valuation techniques may include the most recent transactions in the market, the market price for similar
transactions, discounted cash flow analysis or any other valuation models.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
25
2 Summary of significant accounting policies (cont’d)
2.13. Impairment of financial and contract assets
The Group and the Company assess on a forward-looking basis the expected credit losses associated with their financial assets
carried at amortised cost. The impairment methodology applied depends on whether there has been a significant increase in
credit risk. The Group’s and the Company’s financial assets at amortised cost comprised trade and other receivables, cash and
cash equivalents. Cash and cash equivalents are considered to be low credit risk at the reporting date (Stage 1). Therefore, the
Group/the Company is not relevant a three-stage model for impairment for financial assets other than trade receivables. Loans
granted are measured at fair value through profit or loss as part of investments to unconsolidated subsidiaries and associates.
For Stage 1 financial assets 12-month expected credit losses (‘ECL’) are recognised and interest revenue is calculated on the
gross carrying amount of the asset (that is, without deduction for credit allowance). 12-month ECL are the expected credit losses
that result from default events that are possible within 12 months after the reporting date. It is not the expected cash shortfalls
over the 12-month period but the entire credit loss on an asset weighted by the probability that the loss will occur in the next 12
months.
The financial asset is considered as credit-impaired, if objective evidence of impairment exists at the reporting date. Evidence of
impairment may include indications that the debtors or a group of debtors is experiencing significant financial difficulty, default or
delinquency in payments, the probability that they will enter bankruptcy or other financial reorganisation.
Financial assets are written off, in whole or in part, when there is no reasonable expectation of recovery. Indicators that there is
no reasonable expectation of recovery include, among others, the probability of insolvency or significant financial difficulties of the
debtor. Impaired debts are derecognised when they are assessed as uncollectible.
For trade, other receivables and contract assets, the Group/the Company applies the simplified approach, which requires expected
lifetime losses to be recognised from initial recognition of the receivables. Trade receivables and contract assets are classified
either to Stage 2 or Stage 3:
− Stage 2 – comprises receivables for which there the simplified approach was applied to measure the expected lifetime credit
losses, except for certain trade receivables classified in Stage 3;
− Stage 3 – comprises trade receivables which are overdue more than 90 days (except is reasonable explanation for that) or
individually identified as impaired.
The Group trade receivables and contract assets mainly comprised receivables from related parties and managed funds by the
subsidiaries. The Company’s trade receivables and contract assets mainly comprised receivables from related parties. Trade
receivables is covered within month after reporting date or settlement is deferred by the Group decision. Therefore, for Stage 2
trade receivables/contract assets the ECL are calculated and recognised if would be determined material amount for potential
impairment based on settlement of trade receivables after reporting date.
2.14. Trade receivables
Trade receivables are amounts due from customers for goods sold or services performed in the ordinary course of business. If
collection is expected in one year or less (or in the normal operating cycle of the business if longer), they are classified as current
assets. If not, they are presented as non-current assets.
Trade receivables are recognised initially at the amount of consideration that is unconditional unless they contain significant
financing components, when they are recognised at fair value. The Group and the Company hold the trade receivables with the
objective to collect the contractual cash flows and therefore measures them subsequently at amortised cost using the effective
interest method. Details about the Group’s and Company’s impairment policies and the calculation of the loss allowance are
provided in Note 2.13.
2.15. Cash and cash equivalents
Cash and cash equivalents in the statement of financial position comprise cash at banks and on hand and short-term deposits
with an original maturity of three months or less.
For the purpose of the cash flow statement, cash and cash equivalents comprise cash on hand and in current bank account as
well as deposit in bank with an original maturity of three months or less.
The cash or short-term deposits, which use is restricted, are presented in caption ‘restricted cash’ in the statement of financial
position.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
26
2 Summary of significant accounting policies (cont’d)
2.16. Financial liabilities
The Group and the Company recognise a financial liability when they first become parties to the contractual rights and obligations
in the contract.
All financial liabilities are initially recognised at fair value, minus (in the case of a financial liability that is not at fair value through
profit or loss) transaction costs that are directly attributable to issuing the financial liability. Financial liabilities are measured at
amortised cost using the effective interest method or at fair value through profit or loss. A financial liability is derecognised when
the obligation under the liability is discharged or cancelled or expires.
Trade payables
Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from
suppliers. Accounts payable are classified as current liabilities if payment is due within one year or less (or in the normal operating
cycle of the business if longer). Financial liabilities included in trade payables are recognised initially at fair value and subsequently
at amortised cost. The fair value of a non-interest bearing liability is its discounted repayment amount. If the due date of the liability
is less than one year, discounting is omitted.
Borrowings
Borrowings are recognised initially at fair value less directly attributable transaction costs. After initial recognition, borrowings are
subsequently measured at amortised cost using the effective interest method. Borrowings are classified as current liabilities unless
the Group/Company has an unconditional right to defer settlement of the liability for at least 12 months after the end of the reporting
period.
Financial liabilities at fair value through profit or loss
After initial recognition, financial liabilities at fair value through profit or loss are subsequently measured at fair value through profit
or loss. To this group of financial liabilities is attributable contingent consideration and derivatives that are liabilities.
2.17. Derecognition of financial assets and liabilities
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 rights to receive cash flows from the asset have expired;
- the Group and the Company retain the right to receive cash flows from the asset, but have assumed an obligation to pay
them in full without material delay to a third party under a “pass through” arrangement; or
- the Group or the Company have transferred their rights to receive cash flows from the asset and either (a) have
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 have transferred control of the asset.
Where the Group and the Company have transferred their rights to receive cash flows from an asset and have neither transferred
nor retained substantially all the risks and rewards of the asset nor transferred control of the asset, the asset is recognised to the
extent of the Group’s and the Company’s continuing involvement in the asset.
In that case, the Group and the Company’s also recognise an associated liability. The transferred asset and the associated liability
are measured on a basis that reflects the rights and obligations that the Group and the Company have retained.
Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original
carrying amount of the asset and the maximum amount of consideration that the Group could be required to repay.
Financial liabilities
A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires.
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 the income statement.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
27
2 Summary of significant accounting policies (cont’d)
2.18. Leases
At inception of a contract, the Group and the Company assess 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.
Group as a lessee
At commencement or on modification of a contract that contains a lease component, the Group and the Company allocate the
consideration in the contract to each lease component on the basis of its relative stand-alone prices. The Group and the Company
recognise a right-of-use asset and a lease liability at the lease commencement date.
Right-of-use assets
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. 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/the Company 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 (Note 2.10), if any, and adjusted
for certain remeasurements of the lease liability. As at 31 December 2020 and 2021 right-of-use assets of the Group/the Company
relate to leased properties and are depreciated over 1-5 and 1-4 years, respectively.
The Group/the Company presents right-of-use assets in ‘property, plant and equipment' in the statement of financial position.
Lease liability
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/the Company’s
incremental borrowing rate. The Group/the Company 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.
Lease payments included in the measurement of the lease liability comprise the following:
- fixed payments, including in-substance fixed payments, less any lease incentives receivable;
- variable lease payments that depend on ar. index or a rate, initially measured using the index or rate as at the
commencement date;
- amounts expected to be payable under a residual value guarantee; and
- the exercise price under a purchase option that the Group/the Company is reasonably certain to exercise, lease payments
in an optional renewal period if the Group/the Company is reasonably certain to exercise an extension option, and
penalties for early termination of a lease unless the Group/the Company is reasonably certain not to terminate early.
After the commencement date, the amount of lease liabilities is increased to reflect the accretion of interest and reduced for the
lease payments made. In addition, 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/the Company’s estimate of the amount expected to be payable under a residual
value guarantee, if the Group/the Company 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. 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.
Variable lease payments that do not depend on an index or a rate are recognized as expenses in the period in which the event
or condition that triggers the payment occurs.
The Group/the Company lease liabilities in separate line in the statement of financial position.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
28
2 Summary of significant accounting policies (cont’d)
2.18 Leases (cont’d)
Short-term leases and leases of low-value assets
The Group/the Company has elected not to recognise right-of-use assets and lease liabilities for leases of low-value assets and
short-term leases. The Group/the Company recognises the lease payments associated with these leases as an expense on a
straight-line basis over the lease term.
Lease modification
Lease modification is a change in the scope of a lease, or the consideration for a lease, that was not part of the original terms and
conditions of the lease. The Group/the Company account for a lease modification as a separate lease if the modification increases
the scope of the lease by adding the right to use one or more underlying assets and the consideration for the lease increases by
an amount commensurate with the stand-alone price for the increase in scope and any appropriate adjustments to that stand-
alone price to reflect the circumstances of the particular contract. For a lease modification that is not accounted for as a separate
lease, at the effective date of the lease modification the Group/the Company allocate the consideration in the modified contract to
each lease component on the basis of its relative stand-alone prices, determine the lease term of the modified lease and
remeasure the lease liability by discounting the revised lease payments using a revised discount rate. The revised discount rate
is determined as the interest rate implicit in the lease for the remainder of the lease term, if that rate can be readily determined,
or the lessee’s incremental borrowing rate at the effective date of the modification, if the interest rate implicit in the lease cannot
be readily determined. For a lease modification that is not accounted for as a separate lease, the Group/the Company account
for the remeasurement of the lease liability by decreasing the carrying amount of the right-of-use asset to reflect the partial or full
termination of the lease for lease modifications that decrease the scope of the lease and making a corresponding adjustment to
the right-of-use asset for all other lease modifications, the Group/the Company recognize in profit or loss any gain or loss relating
to the partial or full termination of the lease.
2.19. Revenue recognition and costs to obtain contract with customers
Revenue from contracts with customers includes asset management, brokerage and other services revenue.
Revenue from the asset management and brokerage services
Revenue from asset management services is recognized as a percentage from asset under management or investors
commitments over the period in which the control of the asset management services is transferred to the client, i.e. when services
are provided. Asset management services are provided as long as the client has the investment in funds managed by the Group.
Revenue from brokerage services is recognized at point in time when the control of the brokerage services is transferred to the
client, i.e. when services are actually provided. It is the date when securities are recorded on the client’s account (transaction
settlement date).
The Group assesses whether some asset management services are separate services provided to the customer (i.e. separate
performance obligation). If the service is a separate service provided to the customer, its income is recognized when the service
is actual provided. If it is not a separate service provided to the customer but part of the asset management service to manage
funds, the recognition of the revenue is deferred and recognized over the average period of the client's contract. The Group earns
fund distribution income from investors that invest into certain funds. The Group analysed whether distribution is a separate service
provided to the clients or part of the asset management service to manage funds and concluded that the distribution of alternative
funds for informed investors and the distribution of investment funds is separate service, as each fund is specialized, and the
Group provides a separate identification service for the person or entity investing in such a fund, which includes elements of fund
selection and application. Meanwhile, in the case of the distribution of Lithuanian pension funds, the Company assesses that the
distribution is not a separate service, but a part of the asset management service, because pension funds are standardized
products designed for a retail client. As a result, the revenue of the pension fund distribution fee is considered as a contractual
obligation and recognized over the average term of the client contract - 10 years.
The Group earns variable remuneration - a success fee when the return of certain funds exceeds the expected return limit.
Depending on the fund rules, the Group earns the right to a success fee as soon as the fund's return exceeds the expected return
limit or only at the end of the fund's life when the fund's assets are distributed. The Group recognizes the success fee as revenue
when it earns the right to a calculated success fee, but only to the extent that it is highly probable that a significant reversal in the
amount of success fee recognised will not occur when the uncertainty associated with the variable consideration is subsequently
resolved.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
29
2 Summary of significant accounting policies (cont’d)
2.19 Revenue recognition and costs to obtain contract with customers (cont’d)
Costs to obtain contracts with customers
Costs to obtain contracts with customers are commissions paid to external intermediaries for distribution of pension funds. They
are capitalised and presented in the statement of financial position within ‘Intangible and costs to obtain contracts with customers
assets’. The amortization period used for Costs to obtain contracts with customers is 10 years and is based on the average
expected duration of the client's stay with the Group.
Interest income
Interest income is calculated by applying the effective interest rate to the gross carrying amount of a financial asset except for
financial assets that subsequently become credit-impaired. For credit-impaired financial assets the effective interest rate is applied
to the net carrying amount of the financial asset (after deduction of the loss allowance).
Disposal of investments
Gain (loss) from sale of investment is recognised when the significant risk and rewards of ownership of the investment have
passed to the buyer and are recognised within operating activity, as the parent company treats the securities trading as its main
activity.
Dividends income
Income is recognised when the Group’s and the Company’s right to receive the payment is established.
2.20. Cash and non-cash distribution to equity holders of the parent
The Company recognises a liability to make cash or non-cash distributions to equity holders of the parent when the distribution is
authorised and the distribution is no longer at the discretion of the Company. In Lithuania a distribution is authorised when it is
approved by the shareholders. A corresponding amount is recognised directly in equity. The liability for non-cash distributions is
measured at the fair value of the assets to be distributed with subsequent fair value re-measurement recognised directly in equity
as adjustment to the amount of the distribution.
Upon distribution of non-cash assets, any difference between the carrying amount of the liability and the carrying amount of the
assets distributed is recognised in the statement of profit or loss.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
30
2 Summary of significant accounting policies (cont’d)
2.21. Current and deferred income tax
The tax expense for the period comprises current and deferred tax. Tax is recognised in the income statement, except to the
extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, the tax is also recognised
in other comprehensive income or directly in equity, respectively.
The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted by the end of the
reporting period in the countries where the Company and its consolidated subsidiaries operate and generate taxable income.
Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is
subject to interpretation. It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax
authorities.
The standard income tax rate in Lithuania was 15 % in 2021 and in 2020. Starting from 2010, tax losses can be transferred within
Lithuania at no consideration or in exchange for certain consideration between the group companies if certain conditions are met.
Deferred income taxes are calculated using the liability method. Deferred income taxes reflect the net tax effects of temporary
differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for
income tax purposes. Deferred tax assets and liabilities are measured using the tax rates expected to apply to taxable income in
the years in which those temporary differences are expected to reverse based on tax rates enacted or substantially enacted at
the reporting date.
Deferred tax liabilities are recognised for all taxable temporary differences, except:
− Where the deferred tax liability arises from the initial recognition of goodwill or of an asset or liability in a transaction that is not
a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss;
− In respect of taxable temporary differences associated with investments in subsidiaries and associates, where the timing of the
reversal of the temporary differences can be controlled and it is probable that the temporary differences will not reverse in the
foreseeable future.
By Lithuanian Income Tax Law shall be not taxed sale of shares of an entity, registered or otherwise organised in a state of the
European Economic Area or in a state with which a treaty for the avoidance of double taxation has been concluded and brought
into effect and which is a payer of corporate income tax or an equivalent tax, to another entity or a natural person where the entity
transferring the shares held more than 10% of voting shares in that entity for an uninterrupted period of at least two years. If
mentioned condition is met or will be met by judgement of the management of the Company, there are not recognised any deferred
tax liabilities or assets in respect of temporary differences associated with these investments. By Lithuanian Income Tax Law shall
be not also taxed income from investments into collective investment undertakings.
Deferred tax asset has been recognised in the statement of financial position to the extent the management believes it will be
realised in the foreseeable future, based on taxable profit forecasts. If it is believed that part of the deferred tax asset is not going
to be realised, this part of the deferred tax asset is not recognised in the financial statements.
Deferred tax asset are not recognised:
− Where the deferred tax asset relating to the deductible temporary difference arises from the initial recognition of an asset or
liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting
profit nor taxable profit or loss;
− In respect of deductible temporary differences associated with investments in subsidiaries and associates, deferred tax assets
are recognised only to the extent that it is probable that the temporary differences will reverse in the foreseeable future and
taxable profit will be available against which the temporary differences can be utilised.
In Lithuania tax losses can be carried forward for indefinite period, except for the losses incurred as a result of disposal of securities
and/or derivative financial instruments. In Lithuania such carrying forward is disrupted if the Company changes its activities due
to which these losses incurred except when the Company does not continue its activities due to reasons which do not depend on
the Company itself. In Lithuania the losses from disposal of securities and/or derivative financial instruments can be carried
forward for 5 consecutive years and only be used to reduce the taxable income earned from the transactions of the same nature.
From 1 January 2014 current year taxable profit could be decreased by previous year tax losses only up to 70% in Lithuania.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
31
2 Summary of significant accounting policies (cont’d)
2.21 Current and deferred income tax (cont’d)
From 1 January 2018 according to the new Corporate Income Tax Act of Latvia the annual profit would be not taxed. Corporate
income tax would be paid on distributed profit, including conditional distributed profit as for example: expenditure not related to
economic activities, some loans granted to related parties, some provisions for doubtful debts. The tax rate on (net) distributed
profit would be 20/80. From 1 January 2018 the tax base would be reduced by the gain on sale of shares, if the shares were held
for an uninterrupted period of at least 36 months. The excess gain can be transferred and utilized in the future periods. The income
tax payable on dividends from Latvian consolidated subsidiaries is recognised as the income tax expense of the period in which
the dividends are declared, except for deferred tax liability from undistributed profit earned from 1 January 2018 recognised by
the Group when it expected to be distributed in the foreseeable future.
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 profit will be available to allow all or part of the deferred tax asset to be utilised. Unrecognised
deferred tax assets are reassessed at each reporting date and are recognised to the extent that it has become probable that future
taxable profits will allow the deferred tax asset to be recovered.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current
tax liabilities and when the deferred taxes assets and liabilities relate to income taxes levied by the same taxation authority on
either the same taxable entity or different taxable entities where there is an intention to settle the balances on a net basis.
2.22. Provisions
Provisions are recognised when the Group and the Company have a present obligation (legal or constructive) as a result of a past
event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a
reliable estimate can be made of the amount of the obligation. Where the Group and the Company expect some or all of 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. The expense relating to any provision is presented in the income statement net of any
reimbursement. If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that
reflects, where appropriate, the risks specific to the liability. Where discounting is used, the increase in the provision due to the
passage of time is recognised as a finance cost.
Contingent liabilities recognised in a business combination
A contingent liability recognised in a business combination is initially measured at its fair value. Subsequently, it is measured at
the higher of:
− the amount that would be recognised in accordance with the general guidance for provisions above (IAS 37) or
− the amount initially recognised less, when appropriate, cumulative amortisation recognised in accordance with the guidance for
revenue recognition (IFRS 15).
2.23. Segments
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker.
The chief operating decision-maker, who is responsible for allocating resources and assessing performance of the operating
segments, has been identified as Board of Directors that makes strategic decisions.
2.24. Share capital
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are
recognised in equity as a deduction, net of tax, from the retained earnings. Where any group company purchases the company’s
equity share capital (treasury shares), the consideration paid, including any directly attributable incremental costs (net of income
taxes) is deducted from equity attributable to the company’s equity holders until the shares are cancelled or reissued. Where such
shares are subsequently reissued, any consideration received, net of any directly attributable incremental transaction costs and
the related income tax effects, is included in equity attributable to the company’s equity holders.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
32
2 Summary of significant accounting policies (cont’d)
2.25. Employee benefits
Social security contributions
The Company and the Group pay social security contributions to the state Social Security Fund (the Fund) on behalf of its
employees based on the defined contribution plan in accordance with the local legal requirements. A defined contribution plan is
a plan under which the Group pays fixed contributions into the Fund and will have no legal or constructive obligations to pay
further contributions if the Fund does not hold sufficient assets to pay all employees benefits relating to employee service in the
current and prior period. Social security contributions are recognised as expenses on an accrual basis and included in payroll
expenses.
Termination benefits
Termination benefits are payable whenever an employee’s employment is terminated before the normal retirement date or
whenever an employee accepts voluntary redundancy in exchange for these benefits. The group recognises termination benefits
at the earlier of the following dates: (a) when the group can no longer withdraw the offer of those benefits; and (b) when the entity
recognises costs for a restructuring that is within the scope of IAS 37 and involves the payment of termination benefits. In the
case of an offer made to encourage voluntary redundancy, the termination benefits are measured based on the number of
employees expected to accept the offer. Benefits falling due more than 12 months after reporting date are discounted to their
present value.
Bonus plans
The Company and the Group recognise a liability and an expense for bonuses where contractually obliged or where there is a
past practice that has created a constructive obligation. The bonus plans that provides the employee with a choice of two
settlement alternatives that are mutually exclusive, and in which one of the alternative is equity-settled share-based payment and
other alternative is cash that is not share-based payment, accounted for as a share-based payment by applying the requirements
in IFRS 2 for compound instruments by analogy. The liability for the cash alternative that is not share-based payment are measured
and remeasured in accordance with IAS 19 for such arrangements with employees. Some part of bonuses payment is deferred
from one to five years after end of reporting period and employment contract have to be not terminated until payment date to
receive relevant part of bonus. The deferred amount of bonuses is recognised into profit or loss over the service vesting period.
Any incremental fair value of the share-based payment over the initial value of the liability component is accounted for as an equity
component. If and when the choice for a cash alternative is sacrificed, then the liability is reclassified to equity and further the
Group/the Company recognise employee services received as equity‑settled share‑based payment transactions.
Pension obligations
If there is an individual arrangement with an employee the Company and the Group may make payments into defined contribution
pension plans. A defined contribution plan is a pension plan under which the group pays fixed contributions into a separate entity.
The group has no legal or constructive obligations to pay further contributions if the fund does not hold sufficient assets to pay all
employees the benefits relating to employee service in the current and prior periods.
2.26. Share-based payments
The Group operates a number of equity-settled, share-based compensation plans (including bonus plans with cash-alternative),
under which the entity receives services from employees as consideration for equity instruments (options) of the Group. The fair
value of the employee services received in exchange for the grant of the options is recognised as an employee benefits expense.
The total amount to be expensed as equity component of share based payments is determined by reference to the fair value of
the options granted:
− including any market performance conditions;
− excluding the impact of any service and non-market performance vesting conditions (for example, profitability, sales growth
targets and remaining an employee of the entity over a specified time period); and
− excluding the impact of any non-vesting conditions (for example, the requirement for employees to save).
Grant date is the date at which the Group/Company and the employee agree to a share-based payment arrangement, and requires
that the entity and the employee have a shared understanding of the terms and conditions of the arrangement. If the agreement
is subject to an approval process, then grant date is the date on which that approval is obtained. If the employee services is
rendered before grant date, the Group/the Company estimating the fair value of the equity instruments is by assuming that grant
date is at the reporting date. Once grant date has been established, the Group/the Company revises the earlier estimates so that
the amounts recognised for services received are based on the grant-date fair value of the equity instruments.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
33
2 Summary of significant accounting policies (cont’d)
2.26 Share-based payments (cont’d)
Non-market vesting conditions are included in assumptions about the number of options that are expected to vest. The total
expense is recognised into profit or loss over the vesting period, which is the period over which all of the specified vesting
conditions are to be satisfied. At the end of each reporting period, the entity revises its estimates of the number of options that are
expected to vest based on the non-marketing vesting conditions. It recognises the impact of the revision to original estimates, if
any, in the income statement, with a corresponding adjustment to equity.
When the options are exercised, the Company issues new shares or sell own shares. The proceeds received net of any directly
attributable transaction costs are credited to share capital (nominal value) and share premium when the options are exercised by
issuing of new shares.
In its separate financial statements the grant by the Company of options over its equity instruments to the employees of subsidiary
undertakings in the group is treated as a capital contribution. The fair value of employee services received, measured by reference
to the grant date fair value, is recognised over the vesting period as an increase to investment in subsidiary undertakings, with a
corresponding credit to equity.
Share - based payments – modification and cancellation
If the terms of an equity-settled award are modified, at a minimum an expense is recognised as if the terms had not been modified.
An additional expense is recognised for any modification that increases the total fair value of the share-based payment
arrangement, or is otherwise beneficial to the employee, as measured at the date of modification.
If an equity-settled award is cancelled, it is treated as if it had vested on the date of cancellation, and any expense not yet
recognised for the award is recognised immediately. However, if a new award is substituted for the cancelled award, and
designated as a replacement award on the date that it is granted, the cancelled and new award are treated as if they were a
modification of the original award, as described in the previous paragraph.
If an equity award is cancelled by forfeiture, when the vesting conditions (other than market conditions) have not been met, any
expense not yet recognised for that award, as at the date of forfeiture, is treated as if it had never been recognised. At the same
time, any expense previously recognised on such cancelled equity awards are reversed from the accounts effective as at the date
of forfeiture.
The dilutive effect, if any, of outstanding options is reflected as additional share dilution in the computation of earnings per share.
Share - based payment – settlement choice of employee
If the counterparty has the right to choose whether a share‑based payment transaction is settled in cash or by issuing equity
instruments, the Group/the Company has granted a compound financial instrument, which includes a debt component and an
equity component. The fair value of the compound financial instrument is the sum of the fair values of the two components. The
Group/the Company measure the fair value of the debt component as the fair value of the liability under the cash alternative. If
the liability for the cash alternative that is not share-based payment are measured and remeasured in accordance with IAS 19 for
such arrangements with employees. The equity component is recognised initially at the difference between the fair value of the
compound financial instrument as a whole and the fair value of the liability component, taking into account that the counterparty
must forfeit the right to receive cash in order to receive the equity instrument. The Group/the Company account separately for
employee services received in respect of each component of the compound financial instrument. For the debt component, the
Group/the Company recognise employee services received, and a liability to pay for those services, as the counterparty renders
service. For the equity component, the Group/the Company recognise employee services received, and an increase in equity, as
the counterparty renders service as equity‑settled share‑based payment transactions. If and when the choice for a cash alternative
is sacrificed, then the liability is reclassified to equity and further recognise employee services received as equity‑settled
share‑based payment transactions. If the Group/the Company pays in cash on settlement rather than issuing equity instruments,
that payment settled the liability in full. Any equity component previously recognised remain within equity.
2.27. Contingencies
Contingent liabilities are not recognised in the financial statements. They are disclosed unless the possibility of an outflow of
resources embodying economic benefits is remote.
A contingent asset is not recognised in the financial statements but disclosed when an inflow or economic benefits is probable.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
34
2 Summary of significant accounting policies (cont’d)
2.28. Events after the reporting period
Events after the reporting period that provide additional information about the Group’s position as at the end of the reporting period
(adjusting events) are reflected in the financial statements. Events after the reporting period that are not adjusting events are
disclosed in the notes when material.
2.29. Significant accounting judgements and estimates
The preparation of financial statements requires management of the Group and the Company to make judgements and estimates
that affect the reported amounts of revenues, expenses, assets and liabilities and disclosure of contingent liabilities, at the end of
reporting period. However, uncertainty about these assumptions and estimates could result in outcomes that could require a
material adjustment to the carrying amount of the asset or liability affected in the future periods.
Estimates and judgements are continually evaluated and are based on historical experience and other factors, including
expectations of future events that are believed to be reasonable under the circumstances.
Judgements
In the process of applying the Group accounting policies, management has made the following judgement, which has most
significant effect on the amounts recognised in the consolidated financial statements:
Investment entity
According to the management, the Company meets all the defining criteria of an investment entity from the split-off in 2014 and
henceforth investments in unconsolidated subsidiaries and associates are measured at fair value through profit or loss. The
management is continually reviewing whether the Company meets all the defining criteria of an investment entity. In addition, the
management assesses the Company’s operation objective, investment strategy, origin of income and fair value models and
whether investment-related services provided by the consolidated subsidiaries to third parties are ancillary to its core investing
activities.
The identification of customer of asset management entities
When the Group starts to manage the new fund, it decides on who is the client of the Group: the fund itself or its participant. This
decision affects the accounting for the cost of concluding contracts with fund participants in accordance with IFRS 15. The Group
has made the following decisions about who is the client of the funds it manages:
− In the case of Lithuanian pension funds, its client is each participants of the fund, because the Group manages the information
of the fund participant and communicates directly with each participant of pension funds. As a result, incremental costs to
obtain contract for these clients are capitalised by the Group;
− In the case of investment funds, alternative funds and Latvian pension funds, the Group estimates that its client is a fund
rather than a separate fund participant. This solution is based on the fact that these funds are distributed and relationships
with fund investors are supported by intermediaries - usually financial brokerage firms or fund platforms. The Group usually
has no contact with the investors of these funds and does not directly communicate with them. Often, the Group does not
even have information about the end customers because it only accesses the compound account of the investors and not the
individual accounts of the fund participants. As a result, incremental costs to sign-up new investors to these funds are
expensed as incurred by the Group.
Success fee
The Group does not recognize the success fee, accrued in the managed funds, as revenue until the condition for non-returnable
payment of it is not met. The Group is judged that until the condition for non-returnable payment is met, it is exist significant
uncertainty about the possible amount, timing of payment and a significant reversal in received amount of success fee, if it
applicable. As at 31 December 2021 the Group has not received any success fee, which could be returned to managed funds.
Control of managed entities/funds
The Group decides whether is control managed entities and funds. The main factors that the Group is assessed together are
aggregate economic interests and investors held rights, including kick-out rights. A higher aggregate economic interest was
identified for the closed-ended type investment companies INVL Technology and INVL Baltic Real Estate. Unlike other managed
funds, the shareholders of these entities have full voting rights, as in any joint stock company. Investors can realize return from
them first by selling shares on the stock exchange and receiving dividends. Decisions regarding dividends can only be made by
shareholders and not by fund managers and the Group does not have sufficient power to alone decide regarding dividend. Both
companies have at least two other major shareholders holding together larger shareholdings than the Group. These shareholders
also jointly control the Group. Therefore, after assessment the Group decides that it do not have control over managed entities
and funds.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
35
2 Summary of significant accounting policies (cont’d)
2.29 Significant accounting judgements and estimates (cont’d)
Estimates and assumptions
The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date, that have a
significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are
described below. The Group based its assumptions and estimates on parameters available when the consolidated financial
statements were prepared. Existing circumstances and assumptions about future developments, however, may change due to
market changes or circumstances arising beyond the control of the Group. Such changes are reflected in the assumptions when
they occur.
The significant areas of estimation used in the preparation of these financial statements are discussed below.
Fair value of investments in unconsolidated subsidiaries and associates in financial statements
The fair values of investments in unconsolidated subsidiaries and associates are determined by using valuation techniques,
primarily earnings multiples, discounted cash flows and recent comparable transactions. The models used to determine fair values
are periodically reviewed and compared against historical results to ensure their reliability. Details of the inputs and valuation
models used to determine Level 3 fair value, is provided in Note 12.
The fair value of the investments in unconsolidated subsidiaries and associates of the Group and the Company as at 31 December
2021 was EUR 23,012 thousand and EUR 22,481 thousand, respectively (as at 31 December 2020 - EUR 13,564 thousand and
EUR 26,615 thousand, respectively) (described in more details in Note 12).
Useful lives of funds’ management rights and amortisation period of costs to obtain contracts with customers
The useful lives of funds’ management rights acquired through business combinations are disclosed in Note 2.6 and amortisation
charge for the year is disclosed in Note 10. The useful lives are determined by management at the time the asset is acquired and
reviewed on an annual basis for appropriateness. The lives are based on historical experiences with similar assets as well as
anticipation of future events, which may impact their life. As at 31 December 2021 and 2020 the Group assessed that there is no
impairment indication of funds’ management rights. If the estimated useful lives of funds’ management rights have been one year
shorter, the amortisation charge for the year ended 31 December 2021 and 2020 would have increased by EUR 98 thousand and
EUR 77 thousand, respectively.
Amortisation period of costs to obtain contracts with customers is 10 years, based on the average expected duration of the client's
stay with the Group. If the estimated amortisation period of costs to obtain contracts with customers have been one year shorter,
the amortisation charge for the year ended 31 December 2021 would have increased by EUR 39 thousand, the amortisation
charge for the year ended 31 December 2020 would have increased by EUR 34 thousand.
Deferred tax assets
Deferred tax assets are recognised for tax losses carry-forwards to the extent that the realisation of the related tax benefit through
future taxable profits is probable. Significant management judgement is required to determine the amount of deferred tax assets
that can be recognised based upon the likely timing and amount of future taxable profits together with future tax planning
strategies.
Deferred tax asset is recognized on individual company basis taking into account future performance plans of those companies.
No deferred tax asset is recognized from Group’s tax losses carry forward for indefinite period of time of EUR 1,128 thousand as
31 December 2021 (as at 31 December 2020 – EUR 2,333 thousand) due to future uncertainties related with the performance of
those companies. As at 31 December 2021 and 2020 all above mentioned tax losses is related to consolidated subsidiary UAB
INVL Asset Management. As at 31 December 2021 in the total deferred tax asset balance of the Group the amount of EUR 222
thousand (as at 31 December 2020 – EUR 240 thousand) relates to deferred tax asset recognized from the taxable losses of the
Company and EUR 384 thousand (as at 31 December 2020 – EUR 579 thousand) was recognized from the taxable losses of
other Group’s entities (Note 6). As at 31 December 2021 recognition of deferred tax asset from the taxable losses of acquired
asset management entities are supported on the estimation of these entities’ profitability, which is based on the forecasted growth
of managed funds and participants portfolio, on the level of management fees, on future funds return and number of participants.
If the profitability estimation would be change by 5%, deferred tax asset would be recognised by EUR 19 thousand more/less (as
at 31 December 2020 – EUR 29 thousand).
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
36
2 Summary of significant accounting policies (cont’d)
2.29 Significant accounting judgements and estimates (cont’d)
Estimates and assumptions (cont’d)
Bonuses
The Group have bonus plans, where employees have choice of two settlement alternatives that are mutually exclusive, and in
which one of the alternative is equity-settled share-based payment (by granting share options of the Company) and other
alternative is cash that is not share-based payment. As described in more details in Note 2.26, this arrangement with employees
is accounted as a compound financial instrument, which includes a debt component and an equity component. The Group use
estimates of employee service vesting period and recognise expenses proportionately over estimated vesting period. The equity
component as equity-settled share-based payment are measured at the grant date fair value of share-options. The valuation
method of fair value of share-options is a significant accounting estimate. The fair value of equity-settled share-based payment is
calculated using the Black-Scholes option valuation method. All key inputs, with the exception of share price volatility, are directly
observable in the market (the Company’s share price and risk-free interest rate). For volatility input is used historical shares
volatility on exchange. More details on inputs are disclosed in Note 18.
Other areas involving estimates include useful lives of property, plant and equipment, discount rate for lease liabilities and
allowances for accounts receivable. According to the management, these estimates do not have significant risk of causing a
material adjustment.
3. Business combinations, investments into associates, disposals
The movement of investments in associates was as follows:
Group
Company
2021
2020
2021
2020
At 1 January
26,615
30,058
26,615
30,058
Acquisition of additional shares in associate
-
25
-
25
Disposal of associate
(4,553)
(1,094)
(4,553)
(1,094)
Changes in fair value
419
(2,374)
419
(2,374)
At 31 December
22,481
26,615
22,481
26,615
The movement of investments in subsidiaries of the Company was as follows:
Company
2021
2020
At 1 January
27,479
26,732
Share of net profit (loss) of consolidated subsidiaries accounted for using equity method
6,143
1,759
Establishment of subsidiaries and increase of share capital
8,800
-
Disposals
(644)
-
Dividends from consolidated subsidiaries
(1,955)
(1,693)
Share-based payments of consolidated subsidiaries
555
298
Loans granted/repaid, net
55
40
Interest charged/repaid, net
-
13
Changes in fair value
10,417
330
Decreased share capital (free funds returned)
(28)
-
Reclassification to financial assets at fair value due to disposals
(352)
-
At 31 December
50,470
27,479
At equity method
27,473
13,930
At fair value – shares
22,997
13,252
At fair value - loans granted
-
297
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
37
3 Business combinations, investments into associates, disposals (cont’d)
The movement of investments in unconsolidated subsidiaries of the Group was as follows:
Group
2021
2020
At 1 January
13,564
13,166
Loans granted/repaid, net
55
40
Interest charged/paid, net
-
13
Decrease of share capital
(28)
15
Changes in fair value
10,417
330
Reclassification to financial assets at fair value due to disposals
(352)
-
Disposals
(644)
-
At 31 December
23,012
13,564
Shares
23,012
13,267
Loans granted
-
297
Acquisitions in 2021 and 2020
The Group has not any acquisition of subsidiaries in 2021 and 2020, except below described establishment of entities or
increased share capital in previously acquired/established entities.
On 15 June 2021 the Group/the Company has signed business purchase agreement regarding acquisition of life insurance
business of Mandatum Life Insurance Company Limited in the Baltics. Through this transaction the Group would offer customers
more choice to strengthen their financial security and overall well-being. The acquiring business has more than 30,000 customers
across the Baltic countries and total revenue in 2021 was EUR 9.5 million with EUR 25 million of premiums written. Completion
of the transaction is anticipated for the middle of 2022 subject to Baltic and Finnish regulatory approval for permissions and
licensing. The acquisition would be performed by newly established entity INVL Life UAB.
Until completion, Mandatum Life Insurance Company Limited will operate in the Baltics as is with all customers wanting to acquire
its life insurance products being able to do so through existing Mandatum Life branches and licensed product distributors. In
addition, the Group has begun offering life insurance services to its customers in Lithuania, in collaboration with Mandatum Life.
Establishment of companies (increase or decrease of share capital) in 2021 and 2020
In October 2021 the Company has additional invested EUR 1,000 thousand into the share capital of consolidated subsidiaries
IPAS INVL Asset Management.
A new company INVL Life UAB was established by the Company in August 2021 with initial authorized capital of EUR 3,700
thousand and with organisational fund of EUR 300 thousand. It is wholly owned subsidiary. In December the Company has
increased authorised capital of entity up to 7,500 thousand. Therefore, during 2021 the Company has transferred to INVL Life
UAB EUR 7,800 thousand in cash.
In August 2021 the share capital of UAB Aktyvo was decreased and receivable of EUR 28 thousand was recognised. It was set-
off with borrowings from UAB Aktyvo.
In October 2020 the Group has established INVL LUX GP1 S.à r.l. as general partner of entity INVL Alternative Assets Umbrella
Fund, SCSp SICAV-RAIF, which serves as vehicle to raise funds for investment in sustainably managed forests and agricultural
land in the Baltic Sea region and Central and Eastern Europe. The Group has invested EUR 15 thousand to general partner.
In April 2020 after obtaining the permission of the Moldovan central bank, convertible bonds of MD Partners UAB owned by the
Company was converted into shares of MD Partners, after which the Company owns 51.37% of shares and 48.63% of shares is
owned by INVL Special Opportunities Fund, managed by consolidated subsidiary UAB INVL Asset Management. For bonds with
nominal value of EUR 2,990 thousand the Company received the shares with nominal value of EUR 2,990 thousand (ratio for one
bond received one share).
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
38
3 Business combinations, investments into associates, disposals (cont’d)
Acquisition of associates in 2021 and 2020
During 2021 the Company/the group has not any acquisition of associates.
During 2020 the Company has additionally acquired shares of INVL Baltic Real Estate for EUR 25 thousand on the stock
exchange.
Disposals of subsidiaries in 2021 and 2020
In June 2021 the Company has sold 100% of shares of UAB Kelio ženklai. Portfolio of shares and granted loan was valued at
EUR 1 million. The Company has received EUR 644 thousand in cash for shares of UAB Kelio ženklai. The parties have agreed
that the Company would relend part of funds received for the shares to UAB Kelio ženklai. It was granted EUR 398 thousand. The
loan is secured by pledging the assets and the shares of UAB Kelio ženklai. After all actions have been taken, the Company’s
granted loan nominal amount was EUR 750 thousand. Maturity of the granted loan is 1 May 2023. Granted loan with carrying
amount of 352 thousand was reclassified from caption ‘Investments into subsidiaries’ to caption ‘Financial assets at fair value
through profit or loss’. In the statement of financial position granted loan is measured at fair value according to fair value of net
assets of UAB Kelio ženklai (EUR 277 thousand as at 31 December 2021). During 2021 positive impact of the investment to the
Group’s/Company’s result was EUR 171 thousand.
In April 2021 unconsolidated subsidiary UAB Įmonių Grupė Inservis has sold UAB Informacinio Verslo Paslaugų Įmonė to UAB
Perlas Finance for EUR 155 thousand.
On 28 December 2021 the Company has signed an agreement with an entity belonging to the Civinity group for the sale of 100%
of the shares of 4 (four) facilities management group companies: UAB Inservis, UAB Priemestis, UAB Jurita and SIA Inservis
(Latvia). The total sale price for the shares is EUR 7 million and the price or part thereof, if applicable, may be adjusted by (a)
increasing it by 12% annual interest rate calculated in accordance with the principle agreed between the parties and (b) reducing
it by impairment, if any. Closing of the transaction requires the permission of the Competition Council and other actions agreed
by the parties. The transaction is expected to be completed until 30 June 2022. The buyer is transferred EUR 700 thousand of
advance for the shares to be sold.
Disposals of associates in 2021 and 2020
On 7 January 2021 the Company sold 15.67% of shares of INVL Baltic Real Estate to unconsolidated subsidiary UAB Cedus
Invest for EUR 4,553 thousand. In March unconsolidated subsidiaries UAB Cedus Invest UAB and UAB Įmonių grupė Inservis
have sold their holdings of 15.67% and 2.46%, respectively, of INVL Baltic Real Estate in the share redemption that INVL Baltic
Real Estate is conducting. The Group/the Company directly and indirectly held stake in INVL Baltic Real Estate was decreased
after disposal to 14.37% of issued shares. Because own shares do not have the property and non-property rights, the Group/the
Company effective ownership is decreased to 23.43%. After annulling of own shares of INVL Baltic Real Estate in 2021 the
Group/the Company owns 23.43% of issued shares.
In 2020 the Company sold 2.46% of shares of INVL Baltic Real Estate to unconsolidated subsidiary UAB Įmonių grupė Inservis
for EUR 1,081 thousand. At 31 December 2020 receivable of EUR 800 thousand arising from disposal was remained not settled.
It was settled in March 2021. The Company has additionally sold shares of INVL Baltic Real Estate for EUR 13 thousand on the
stock exchange.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
39
4. Segment information
The Board of Directors monitors the operating results of the business units of the Group separately for the purpose of making
decisions about resource allocations and performance assessment. After becoming investment entity the performance of activities
excluding asset management segment is evaluated based on changes in fair value of investments, including dividends and interest
income received by the Company. Asset management segment’s performance is evaluated based on net profit or loss. Group
financing (including finance costs and finance income) and income taxes are allocated between segments as they are identified
on basis of separate legal entities. Consolidation adjustments and eliminations are not allocated on a segment basis. Segment
assets are measured in a manner consistent with that of the financial statements. All assets are allocated between segments,
because segments are identified on a basis of separate legal entities. The granted loans by the Company are allocated to
segment’s, to which entities they are granted, assets. The impairment losses of these loans are allocated to a segment to which
the loan was granted initially.
For management purposes, the Group is organised into following operating segments based on their products and services:
Asset management
The asset management segment includes pension, investment funds, alternative investments (private equity, real assets and
private debt) and portfolio management, financial brokerage and land administration services.
Investment activity
The investment activity segment includes the Company investment activities to the unconsolidated subsidiaries, associates and
financial assets at fair value, administrative activities of the Companies. The main investment activities of the Company, which is
presented to the management separately is disclosed below:
Agriculture
Agricultural activities include the primary crop and livestock (milk) production, feed production and grain processing, agricultural
services and poultry farming.
Facility management
The facility management activities include facility management of dwelling-houses, commercial and public real estate properties
and administration of taxes on energy and utilities provided to residents.
Real estate
The real estate activities are investing in investment properties held for future development and in commercial real estate and its
rent.
Bank activities
Bank activities represents indirectly investment into MAIB, bank operating in Moldova and investments into AB Šiaulių bankas,
bank operating in Lithuania, held by the Company. Because both investments amounts are material and operate in different
markets, they are analysed separately.
All other activities
All other activities comprise other investments held by the Company. Until disposal there is also attributed unconsolidated
subsidiary UAB Kelio Ženklai, that are involved in road signs production, wood manufacturing.
Segment revenue, segment expense and segment result include transfers between business segments. Those transfers are
eliminated in column ‘Inter-segment transactions and consolidation adjustments’. Capital expenditure consists of additions to
property, plant and equipment, intangible assets, costs to obtain contract including assets from the acquisition of consolidated
subsidiaries.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
40
4 Segment information (cont’d)
The following table presents revenues, profit (loss) and certain assets and liabilities information regarding the Group’s business
segments for the year ended 31 December 2021:
Asset management
Investment activity
Inter-segment
transactions and
consolidation
adjustments
Total
Year ended
31 December 2021
Revenue
Sales to external customers
15,836
70
-
15,906
Inter-segment sales
-
3
(3)
-
Total revenue
15,836
73
(3)
15,906
Results
Net changes in fair value of
financial assets
4,156
29,416
-
33,572
Interest income
-
31
-
31
Dividend income
21
4,098
-
4,119
Other income
49
1
(1)
49
Employee benefits expense
(8,028)
(379)
-
(8,407)
Depreciation and
amortization
(1,188)
(21)
-
(1,209)
Impairment
(1)
-
-
(1)
Interest expenses
(73)
(8)
-
(81)
Other expenses
(3,913)
(475)
4
(4,384)
Profit (loss) before income
tax
6,859
32,736
-
39,595
Income tax credit
(expenses)
(690)
(1,426)
-
(2,116)
Net profit (loss) for the
year
6,169
31,310
-
37,479
Attributable to:
Equity holders of the parent
6,143
31,310
-
37,453
Non-controlling interest
26
-
-
26
As at 31 December 2021
Assets and liabilities
Segment assets
34,137
98,264
(376)
132,025
Segment liabilities
6,524
4,522
(376)
10,670
Other segment
information
Capital expenditure:
• Property, plant and
equipment
332
21
-
353
• Intangible assets
185
-
-
185
• Costs to obtain contract
455
-
-
455
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
41
4 Segment information (cont’d)
The following table presents revenues, profit (loss) and certain assets and liabilities information regarding the Group’s business
segments for the year ended 31 December 2020:
Asset management
Investment activity
Inter-segment
transactions and
consolidation
adjustments
Total
Year ended
31 December 2020
Revenue
Sales to external customers
12,361
34
-
12,395
Inter-segment sales
-
1
(1)
-
Total revenue
12,361
35
(1)
12,395
Results
Net changes in fair value of
financial assets
123
(3,020)
-
(2,897)
Interest income
-
26
-
26
Dividend income
-
7,168
7,168
Other income
15
13
-
28
Employee benefits expense
(6,278)
(468)
-
(6,746)
Depreciation and
amortization
(1,097)
(19)
-
(1,116)
Impairment
(10)
-
-
(10)
Interest expenses
(120)
(11)
-
(131)
Other expenses
(3,114)
(275)
1
(3,388)
Profit (loss) before income
tax
1,880
3,449
-
5,329
Income tax credit
(expenses)
(76)
120
-
44
Net profit (loss) for the
year
1,804
3,569
-
5,373
Attributable to:
Equity holders of the parent
1,760
3,569
-
5,329
Non-controlling interest
44
-
-
44
As at 31 December 2020
Assets and liabilities
Segment assets
18,962
71,488
(70)
90,380
Segment liabilities
4,841
2,252
(70)
7,023
Other segment
information
Capital expenditure:
• Property, plant and
equipment
103
7
-
110
• Intangible assets
133
-
-
133
• Costs to obtain contract
426
-
-
426
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
42
4 Segment information (cont’d)
The following tables present measurement of investment activities results on the basis of changes in fair value, including
dividend and interest income:
Agriculture
Facility
management
Real estate
Bank sector
(MAIB)
Bank sector
(AB Šiaulių
bankas)
Other
investments
Total
Year ended
31 December 2021
Net changes in fair value
on financial assets
(6)
1,469
425
8,371
10,240
8,917
29,416
Dividend income
2,196
709
227
-
181
785
4,098
Interest income
5
-
-
-
-
26
31
Total income from
investments
2,195
2,178
652
8,371
10,421
9,728
33,545
Investments fair value as
at 31 December 2021
20,318*
7,244
4,402
15,723
26,400
22,887
96,974
*include loans granted to associate.
The Group also have investments at fair value with carrying amount of EUR 16,620 thousand which attributed to asset
management segment.
Agriculture
Facility
management
Real estate
Bank sector
(MAIB)
Bank sector
(AB Šiaulių
bankas)
Other
investments
Total
Year ended
31 December 2020
Net changes in fair value
on financial assets
829
1,264
(3,203)
(670)
(263)
(977)
(3,020)
Dividend income
488
333
6,117
-
-
230
7,168
Interest income
-
-
13
-
-
13
26
Total income from
investments
1,317
1,597
2,927
(670)
(263)
(734)
4,174
Investments fair value as
at 31 December 2020
18,085
5,775
8,530
7,352
16,409
13,561
69,712
The Group also have investments at fair value with carrying amount of EUR 4,579 thousand which attributed to asset management
segment.
Analysis of revenue by timing of revenue recognition:
2021
2020
Group
Company
Group
Company
Revenue recognised over time:
15,496
72
11,997
35
Management fee
11,888
-
10,010
-
Success fee
3,295
-
1,742
-
Other consideration
313
72
245
35
Revenue recognised at a point in time
410
-
398
-
Total revenue
15,906
72
12,395
35
The Company is domiciled in the Lithuania and the Group operates in Lithuania and Latvia. The result of Group’s revenue from
external customers in the Lithuania is EUR 14,445 thousand (2020: EUR 11,520 thousand), and the total of revenue from external
customers from Latvia is EUR 1,461 thousand (2020: EUR 875 thousand).
In 2021 the Group has not recognised as revenue success fee of EUR 2,556 thousand, accrued in the managed entities and
funds, as the condition for non-returnable payment of it is not met (2020: EUR 4,032 thousand).
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
43
4 Segment information (cont’d)
The table below presents distribution of the Group non-current assets (other than financial instruments and deferred tax assets)
by geographical area as at 31 December 2021 and 2020:
5. Other income and expenses
5.1. Net changes in fair value on financial instruments
Group
Company
2021
2020
2021
2020
Net gain (loss) from changes in fair value of unconsolidated
subsidiaries and associates
10,836
(2,044)
10,836
(2,044)
Net gain (loss) from financial assets at fair value through profit or
loss
22,736
(853)
18,580
(976)
Net gain (loss) from financial instruments at fair value through
profit or loss, total
33,572
(2,897)
29,416
(3,020)
5.2. Employee benefits expenses
Group
Company
2021
2020
2021
2020
Short-term employee benefits
6,944
5,881
349
441
Share-based payments (cash alternative)
1,247
736
-
-
Equity-settled share-based payments
216
129
29
26
8,407
6,746
378
467
5.3. Other expenses
Group
Company
2021
2020
2021
2020
Vehicles maintenance costs
(162)
(173)
(2)
(1)
Repairs and maintenance cost of premises
(81)
(106)
(1)
(2)
Taxes
(602)
(479)
(80)
(22)
Professional services
(626)
(297)
(206)
(31)
Fees for securities
(549)
(450)
(31)
(26)
Other expenses
(1,152)
(947)
(140)
(173)
(3,172)
(2,452)
(460)
(255)
In March 2020 the Company has granted donation of EUR 100 thousand to support health care sector in the fight with COVID19
pandemic.
Lithuania
Latvia
Total
As at 31 December 2021
6,447
240
6,687
As at 31 December 2020
6,582
322
6,904
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
44
6. Income tax
Group
Company
2021
2020
2021
2020
Components of the income tax expense
Current year income tax
(193)
(151)
-
-
Prior year current income tax correction
-
(2)
-
-
Deferred income tax income (expense)
(1,923)
197
(1,426)
120
Income tax income (expense) charged to the income statement –
total
(2,116)
44
(1,426)
120
There is no income tax expense recognised in other comprehensive income in 2021 and 2020.
Deferred tax asset and liability were estimated at 15% rate in Lithuania as at 31 December 2021.
The movement in deferred tax assets and liabilities of the Group during 2021 is as follows:
Balance as at
31 December
2020
Recognised in
the income
statement
Transfer of tax
losses within group
Balance as at
31 December
2021
Deferred tax asset
Tax loss carry forward for indefinite period of time
793
(195)
8
606
Tax loss carry forward till 2021
26
(26)
-
-
Receivables
1
-
-
1
Accruals
127
82
-
209
Lease liabilities
212
(3)
-
209
Contract liabilities
181
46
-
227
Recognised deferred tax asset
1,340
(96)
8
1,252
Asset netted with liability of the same legal
entities
(703)
(103)
-
(806)
Deferred tax asset, net
637
(199)
8
446
Deferred tax liability
Property, plant and equipment (right of use
assets)
(198)
8
-
(190)
Intangible assets
(164)
32
-
(132)
Investments at fair value through profit or loss
(1,640)
(1,888)
-
(3,528)
Undistributed profits of consolidated subsidiaries
-
-
-
Costs to obtain contacts with customers
(120)
21
-
(99)
Deferred tax liability
(2,122)
(1,827)
-
(3,949)
Liability netted with asset of the same legal
entities
703
103
-
806
Deferred tax liability, net
(1,419)
(1,724)
-
(3,143)
Deferred tax, net
(782)
(1,923)
8
(2,697)
Deferred tax assets have not been recognised for tax losses carry forward for indefinite period of time of EUR 1,128 thousand
(tax effect EUR 169 thousand) as at 31 December 2021.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
45
6 Income tax (cont’d)
Deferred tax asset and liability were estimated at 15% rate in Lithuania as at 31 December 2020.
The movement in deferred tax assets and liabilities of the Group during 2020 is as follows:
Balance as at
31 December 2019
Recognised in the
income statement
Balance as at
31 December 2020
Deferred tax asset
Tax loss carry forward for indefinite period of time
778
15
793
Tax loss carry forward till 2021
26
-
26
Receivables
1
-
1
Investments at fair value through profit or loss
-
-
-
Accruals
122
5
127
Lease liabilities
236
(24)
212
Contract liabilities
118
63
181
Recognised deferred tax asset
1,281
59
1,340
Asset netted with liability of the same legal
entities
(779)
76
(703)
Deferred tax asset, net
502
135
637
Deferred tax liability
Property, plant and equipment (right of use
assets)
(229)
31
(198)
Intangible assets
(196)
32
(164)
Investments at fair value through profit or loss
(1,695)
55
(1,640)
Undistributed profits of consolidated subsidiaries
-
-
-
Costs to obtain contacts with customers
(140)
20
(120)
Deferred tax liability
(2,260)
138
(2,122)
Liability netted with asset of the same legal
entities
779
(76)
703
Deferred tax liability, net
(1,481)
62
(1,419)
Deferred tax, net
(979)
197
(782)
Deferred tax assets have not been recognised for tax losses carry forward for indefinite period of time of EUR 2,333 thousand
(tax effect EUR 350 thousand) as at 31 December 2020.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
46
6 Income tax (cont’d)
The movement in deferred tax assets and liabilities of the Company during 2021 is as follows:
Balance as at
31 December 2020
Recognised in the
income statement
Transfer of
tax losses
Balance as at
31 December 2021
Deferred tax asset
Tax loss carry forward for indefinite period of time
214
107
(99)
222
Tax loss carry forward till 2021
26
(26)
-
-
Lease liabilities
15
-
-
15
Recognised deferred tax asset
255
81
(99)
237
Asset netted with liability of the same legal
entities
(255)
(81)
99
(237)
Deferred tax asset, net
-
-
-
-
Deferred tax liability
Property, plant and equipment (right of use
assets)
(13)
-
-
(13)
Investments at fair value through profit or loss
(1,619)
(1,507)
-
(3,126)
Deferred tax liability
(1,632)
(1,507)
-
(3,139)
Liability netted with asset of the same legal
entities
255
81
(99)
237
Deferred tax liability, net
(1,377)
(1,426)
(99)
(2,902)
Deferred tax, net
(1,377)
(1,426)
(99)
(2,902)
The movement in deferred tax assets and liabilities of the Company during 2020 is as follows:
Balance as at
31 December 2019
Recognised in the
income statement
Transfer of
tax losses
Balance as at
31 December 2020
Deferred tax asset
Tax loss carry forward for indefinite period of time
214
70
(70)
214
Tax loss carry forward till 2021
26
-
-
26
Lease liabilities
17
(2)
-
15
Recognised deferred tax asset
257
68
(70)
255
Asset netted with liability of the same legal
entities
(257)
(68)
70
(255)
Deferred tax asset, net
-
-
-
-
Deferred tax liability
Property, plant and equipment (right of use
assets)
(16)
3
-
(13)
Investments at fair value through profit or loss
(1,668)
49
-
(1,619)
Deferred tax liability
(1,684)
52
-
(1,632)
Liability netted with asset of the same legal
entities
257
68
(70)
255
Deferred tax liability, net
(1,427)
120
(70)
(1,377)
Deferred tax, net
(1,427)
120
(70)
(1,377)
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
47
6 Income tax (cont’d)
The reconciliation of the total income tax to the theoretical amount that would arise using the tax rate of the Group and
the Company is as follows:
Group
Company
2021
2020
2021
2020
Profit before income tax
39,595
5,329
38,879
5,209
Tax calculated at the tax rate of 15 %
(5,939)
(799)
(5,832)
(781)
Non-taxable income - dividend income
618
1,075
615
1,075
Non-taxable income (expenses) – changes in fair value of financial
assets
3,119
(384)
2,876
(403)
Non-taxable income (expenses) – impact of equity method
-
-
921
264
Other tax non-deductible (expenses) / non-taxable income
(117)
(124)
(6)
(35)
Deferred tax expenses arising from write-down, or reversal of a
previous write-down, of deferred tax asset due to changes in
probability to utilise it
19
15
-
-
Prior year current income tax correction
-
(2)
-
-
The amount of benefit arising from previously unrecognised tax loss
of a prior period that is used to reduce current tax expense
162
263
-
-
Other
22
-
-
-
Income tax credit (expenses) recorded in the income statement
(2,116)
44
(1,426)
120
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
48
7. Earnings per share
Basic earnings per share amounts are calculated by dividing net profit for the year attributable to ordinary equity holders of the
parent by the weighted average number of ordinary shares outstanding during the year.
The weighted average number of shares for 2021 and 2020 was as follows:
Calculation of weighted average for the year
2021
Number of shares
(thousand)
Par value
(EUR)
Issued/365
(days)
Weighted average
(thousand)
Shares issued as at 31 December 2020
11,689
0.29
365/365
11,689
Increase of share capital as at 8 June 2021
60
0.29
206/365
34
Shares issued as at 31 December 2021
11,749
0.29
-
11,723
Calculation of weighted average for the year
2020
Number of shares
(thousand)
Par value
(EUR)
Issued/366
(days)
Weighted average
(thousand)
Shares issued as at 31 December 2019
11,610
0.29
366/366
11,610
Own shares disposed as at 3 June 2020
79
0.29
211/366
46
Shares issued as at 31 December 2020
11,689
0.29
-
11,656
The following table reflects the income and share data used in the basic earnings per share computations:
Group
Company
2021
2020
2021
2020
Net profit, attributable to the equity holders of the parent
37,453
5,329
37,453
5,329
Weighted average number of ordinary shares (thousand)
11,723
11,656
11,723
11,656
Basic earnings per share (EUR)
3.19
0.46
3.19
0.46
The following table reflects the share data used in the diluted earnings per share computations in 2021:
Number of
shares
(thousand)
Issued/365
(days)
Weighted average
(thousand)
Weighted average number of ordinary shares for basic earnings per share
-
-
11,723
Potential dilutive shares from share-based payment (granted on 11 August
2016)
22
365/365
22
Potential dilutive shares from share-based payment (granted on 3 May
2018, on 8 June 2021 share options exercised by issued of new shares)
58
158/365
25
Potential dilutive shares from share-based payment (granted on 6 May
2019)
68
365/365
68
Potential dilutive shares from share-based payment (granted on 25 May
2020)
54
365/365
54
Potential dilutive shares from share-based payment (granted on 1 July
2020)
25
365/365
25
Potential dilutive shares from share-based payment (granted on 10 May
2021)
60
235/365
39
Weighted average number of ordinary shares for diluted earnings per share
-
-
11,956
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
49
7. Earnings per share (cont’d)
The following table reflects the share data used in the diluted earnings per share computations in 2020:
Number of
shares
(thousand)
Issued/366
(days)
Weighted average
(thousand)
Weighted average number of ordinary shares for basic earnings per share
-
-
11,656
Potential dilutive shares from share-based payment (granted on 3 May
2017, on 3 June 2020 share options exercised by disposal of own shares)
14
154/366
6
Potential dilutive shares from share-based payment (granted on 16 May
2017, on 3 June 2020 share options exercised by disposal of own shares)
63
154/366
27
Potential dilutive shares from share-based payment (granted on 3 May
2018)
51
366/366
51
Potential dilutive shares from share-based payment (granted on 6 May
2019)
59
366/366
59
Potential dilutive shares from share-based payment (granted on 25 May
2020)
52
220/366
31
Potential dilutive shares from share-based payment (granted on 1 July
2020)
-
183/366
-
Weighted average number of ordinary shares for diluted earnings per share
-
-
11,830
The following table reflects the income data used in the diluted earnings per share computations in 2021 and 2020:
Group
Company
2021
2020
2021
2020
Net profit, attributable to the equity holders of the parent
37,453
5,329
37,453
5,329
Weighted average number of ordinary and potential shares
(thousand)
11,956
11,830
11,956
11,830
Diluted earnings per share (EUR)
3.13
0.45
3.13
0.45
8. Dividends per share
A dividend in respect of the year ended 31 December 2019 of EUR 0.80 per share, amounting to a total dividend of EUR 9,288
thousand, was approved at the annual general meeting on 30 April 2020.
Changes in liabilities arising from financing activities (dividends) are presented in the table below:
Group/Company
Dividends payable
As at 31 December 2019
363
Dividends paid to equity holders of the parent
(9,038)
Approved dividends
9,288
As at 31 December 2020
613
Dividends paid to equity holders of the parent
(33)
Approved dividends
-
As at 31 December 2021
580
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
50
9. Property, plant and equipment
Group
Right-of-use assets
(leased premises)
Vehicles
Other property, plant and
equipment
Total
Cost:
Balance as at 31 December 2019
1,807
4
493
2,304
Additions
85
-
25
110
Disposals and write-offs
(6)
(4)
(2)
(12)
Balance as at 31 December 2020
1,886
-
516
2,402
Additions
267
-
86
353
Disposals and write-offs
-
-
-
-
Balance as at 31 December 2021
2,153
-
602
2,755
Accumulated depreciation:
Balance as at 31 December 2019
245
4
260
509
Charge for the year
297
-
78
375
Disposals and write-offs
-
(4)
(2)
(6)
Balance as at 31 December 2020
542
-
336
878
Charge for the year
331
-
77
408
Disposals and write-offs
-
-
-
-
Balance as at 31 December 2021
873
-
413
1,286
Net book value as at 31 December 2020
1,344
-
180
1,524
Net book value as at 31 December 2021
1,280
-
189
1,469
Company
Right-of-use assets
(leased premises)
Other property, plant and
equipment
Total
Cost:
Balance as at 31 December 2019
124
94
218
Additions
2
5
7
Disposals and write-offs
-
-
-
Balance as at 31 December 2020
126
99
225
Additions
20
1
21
Disposals and write-offs
-
-
-
Balance as at 31 December 2021
146
100
246
Accumulated depreciation:
Balance as at 31 December 2019
18
93
111
Charge for the year
18
1
19
Disposals and write-offs
-
-
-
Balance as at 31 December 2020
36
94
130
Charge for the year
19
2
21
Disposals and write-offs
-
-
-
Balance as at 31 December 2021
55
96
151
Net book value as at 31 December 2020
90
5
95
Net book value as at 31 December 2021
91
4
95
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
51
9 Property, plant and equipment (cont’d)
The depreciation charge of the Group’s and the Company’s property, plant and equipment for the year 2021 amounts to EUR 408
thousand and EUR 21 thousand, respectively (in the year 2020 EUR 375 thousand and EUR 19 thousand, respectively). Any
property, plant and equipment of the Group and the Company as at 31 December 2021 and 2020 was not have any encumbrance.
10. Intangible assets and costs to obtain contracts with customers
As at 31 December 2021 and 2020 this item of statement of financial position of the Group comprises:
Group
As at 31 December 2021
As at 31 December 2020
Intangible assets
2,677
2,933
Costs to obtain contracts with customers
2,541
2,447
Total
5,218
5,380
Intangible assets
Movement in the account of intangible assets is presented below:
Group
Goodwill
Funds’ management
rights
Software and other
intangible assets
Total
Cost:
Balance as at 31 December 2019
104
4,722
83
4,909
Additions
-
-
133
133
Disposals and write-offs
-
-
-
-
Balance as at 31 December 2020
104
4,722
216
5,042
Additions
-
-
185
185
Disposals and write-offs
-
-
(1)
(1)
Balance as at 31 December 2021
104
4,722
400
5,226
Accumulated amortisation:
Balance as at 31 December 2019
-
1,602
66
1,668
Charge for the year
-
425
6
431
Impairment
-
-
10
10
Disposals and write-offs
-
-
-
-
Balance as at 31 December 2020
-
2,027
82
2,109
Charge for the year
-
426
14
440
Impairment
-
-
1
1
Disposals and write-offs
-
-
(1)
(1)
Balance as at 31 December 2021
-
2,453
96
2,549
Net book value as at 31 December 2020
104
2,695
134
2,933
Net book value as at 31 December 2021
104
2,269
304
2,677
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
52
10 Intangible and costs to obtain contracts with customers assets (cont’d)
The amortisation charge of the Group’s intangible assets for the year ended 31 December 2021 amounts to EUR 440 thousand
(in the year 2020 EUR 431 thousand).
Main intangible assets of the Group are as at 31 December 2021:
− 2
nd
pillar pension funds. The funds’ with carrying amount of EUR 1,778 thousand remaining estimated useful live is 7 years.
The funds’ with carrying amount of EUR 226 thousand remaining estimated useful live is 3 years and is related to Latvian entity.
− 3
rd
pillar pension funds. The funds’ with carrying amount of EUR 64 thousand remaining estimated useful live is 2.75 - 6 years.
− Private debt investment fund. Its carrying amount equals to EUR 201 thousand and remaining estimated useful live is 2.5 years.
Main intangible assets of the Group are as at 31 December 2020:
− 2
nd
pillar pension funds. The funds’ with carrying amount of EUR 2,032 thousand remaining estimated useful live is 8 years.
The funds’ with carrying amount of EUR 301 thousand remaining estimated useful live is 4 years and is related to Latvian entity.
− 3
rd
pillar pension funds. The funds’ with carrying amount of EUR 80 thousand remaining estimated useful live is 3.75 - 7 years.
− Private debt investment fund. Its carrying amount equals to EUR 282 thousand and remaining estimated useful live is 3.5 years.
Costs to obtain contracts with customers
Movement in the account of costs to obtain with customers is presented below:
Group
Balance as at 1 January 2020
2,331
Additions
426
Amortisation
(310)
Balance as at 31 December 2020
2,447
Additions
455
Amortisation
(361)
Balance as at 31 December 2021
2,541
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
53
11. Financial instruments by category
Group
Financial assets at
amortised cost
Assets at fair value
through the profit or loss
Total
31 December 2021
Assets as per statement of financial position
Investments into unconsolidated subsidiaries
-
22,997
22,997
Investments into associates
-
22,481
22,481
Trade and other receivables short term excluding
tax receivables
3,815
-
3,815
Financial assets at fair value through profit and
loss
-
68,116
68,116
Cash and cash equivalents
5,910
-
5,910
Total
9,725
113,594
123,319
Group
Financial assets at
amortised cost
Assets at fair value
through the profit or loss
Total
31 December 2020
Assets as per statement of financial position
Investments into unconsolidated subsidiaries
-
13,549
13,549
Investments into associates
-
26,615
26,615
Trade and other receivables short term excluding
tax receivables
2,422
-
2,422
Financial assets at fair value through profit and
loss
-
34,112
34,112
Cash and cash equivalents
5,741
-
5,741
Total
8,163
74,276
82,439
Group
31 December 2021
31 December 2020
Liabilities as per statement of financial
position
Financial
liabilities at
amortised cost
Financial
liabilities through
the profit or loss
Financial
liabilities at
amortised cost
Financial
liabilities through
the profit or loss
Trade payables
399
-
229
-
Lease liabilities
1,411
-
1,438
-
Other current payables excluding tax
payables and employee benefit payables
984
-
882
18
Total
2,794
-
2,549
18
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
54
11 Financial instruments by category (cont’d)
Company
Financial assets at
amortised cost
Assets at fair value
through the profit or loss
Total
31 December 2021
Assets as per statement of financial position
Investments into unconsolidated subsidiaries
-
22,997
22,997
Investments into associates
-
22,481
22,481
Trade and other receivables
433
-
433
Financial assets at fair value through profit or loss
-
51,496
51,496
Cash and cash equivalents
716
-
716
Total
1,149
96,974
98,123
Company
Financial assets at
amortised cost
Assets at fair value
through the profit or loss
Total
31 December 2020
Assets as per statement of financial position
Investments into unconsolidated subsidiaries
-
13,549
13,549
Investments into associates
-
26,615
26,615
Trade and other receivables
882
-
882
Financial assets at fair value through profit or loss
-
29,548
29,548
Cash and cash equivalents
762
-
762
Total
1,644
69,712
71,356
Company
31 December
2021
31 December
2020
Liabilities as per statement of financial position
Financial liabilities at amortised
cost
Borrowings
-
28
Lease liabilities
100
98
Trade payables
50
3
Other current payables excluding tax payables and employee benefit payables
645
632
Total
795
761
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
55
12. Fair value estimation
Financial instruments that are not carried at fair value
The Group’s and the Company’s principal financial instruments that are not carried at fair value in the statement of financial
position are cash and cash equivalents, trade and other receivables, trade and other payables.
The fair value represents the price that would be received to sell an asset in an orderly transaction between market participants
at the measurement date.
The carrying amount of the cash and cash equivalents, trade and other receivables, trade and other payables of the Group and
the Company as at 31 December 2021 and 2020 approximated their fair value because they are short-term and the impact of
discounting is immaterial.
Financial instruments carried at fair value
The Group uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation
technique:
Level 1: quoted (unadjusted) prices in active markets for identical assets or liabilities;
Level 2: other techniques for which all inputs which have a significant effect on the recorded fair value are observable, either
directly or indirectly;
Level 3: techniques which use inputs with a significant effect on the recorded fair value not based on observable market data.
Unconsolidated subsidiaries and associates are measured at fair value through profit or loss.
The fair value of financial instruments traded in active markets is based on quoted market prices at the balance sheet date. A
market is regarded as active if quoted prices are readily and regularly available from an exchange and those prices represent
actual and regularly occurring market transactions on arm’s length basis. The quoted market price used for financial assets held
by the Group and Company is the measurement date exchange closing price.
The level 2 instruments are investments to collective investment undertakings and entities, where fair value is measured as fair
value of net assets value, which is based only on observable inputs. Therefore, collective investment undertakings and these
entities have invested only to securities which are measured as Level 1 instruments, and have only cash, current liabilities, which
carrying amount approximate to fair value.
The valuation of Level 3 instruments is performed by the Company’s employees, analysts, every quarter. The value is estimated
as at the last day of quarter. The management of the Company review the valuations prepared by analysts.
In 2020 the Company has used income approach for valuation of investments into facility management entities. It was used
discounted cash flows method. In 2021 facility management entities is measured according to signed sale agreement (Note 3).
In 2021 and 2020 the Company has determined net assets value as difference between assets and liabilities, measured using
combination of income and market approach, for valuation of investments into UAB Litagra (agriculture activity). Discounted cash
flows technique was used for income approach. Value of land was determined by using market approach. The cash flows were
adjusted by rent costs of owned land. The final value of investments was determined by combining value of subgroups, land
owned by group of UAB Litagra and other item of assets and liabilities of holding entity to determine net assets value. In 2021
substantially all land was valued by external asset valuators. Significant part of land was newly valued by external asset valuators
in 2020. Valuation of other part of land was made at the end of 2019.
Agricultural activities include the primary crop and livestock (milk) production, feed production and grain processing and poultry
farming. UAB Litagra is holding company which directly and indirectly owned shares of multiple entities which for valuation are
divided into two subgroups. It was prepared separate cash flows for each subgroup and used different discount rate. One subgroup
comprises the primary crop and livestock (milk) production. Second subgroup comprises feed production and grain processing
and poultry farming.
UAB Kelio Ženklai was measured according to fair value of its assets and liabilities. The main assets - buildings - of UAB Kelio
Ženklai were valued using sales comparison method. On the assessment the value of UAB Kelio Ženklai reflects its net assets
value. After disposal in 2021 the Company measured granted loan to UAB Kelio Ženklai at the same techniques as in 2020 were
measured shares and granted loan together.
Investments into UAB MD Partners are measured as fair value of net assets value of entity, where main indirectly owned assets
– investment into MAIB bank – are measured using price to earnings (P/E) and P/BV multiplier technique of comparable banks
from the Central and Eastern Europe (13 peers are selected in 2021 and 9 peers are selected in 2020) and applying discount.
Discount reflects lack of marketability and country and MAIB risk . Structure of investments into MAIB is described in Note 1. The
Company indirectly has 7.9% shares of MAIB. There were also some cash and liabilities at the level intermediate entities UAB
MD Partners and HEIM Partners Limited.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
56
12 Fair value estimation (cont’d)
Financial instruments carried at fair value (cont’d)
Dormant entities are measured according to its equity, because they have only cash and current liabilities.
The Group and the Company have also invested into collective investment undertakings, which main assets are Level 3 financial
instruments. These investments are valued at net assets value of collective investment undertakings, which are measured at fair
value and communicated to investor by the management entity of collective investment undertakings. Investments of collective
investment undertakings are measured EBITDA and Revenue multiplier technique or by using discounted cash flows technique.
The following table represents inputs and fair value valuation techniques of unconsolidated subsidiaries, associates and other
investments used by the Company and the Group as at 31 December 2021:
Profile of activities
Fair value
Valuation
technique
Inputs
Values of inputs
Facility management (UAB
Inservis, UAB Įmonių Grupė
Inservis*) (Level 3)
7,244
Transaction price
-
-
Agriculture (UAB Litagra)
(Level 3)
18,079
Fair value of net
assets determined
by using
combination of
discounted cash
flows and sales
comparison method
EBITDA margin
5%-6% and 16%-
17%
Discount rate
7.09% and 7.48%
Terminal growth rate
1%
Average value of 1 ha of land,
EUR
6,213
Road signs production, wood
manufacturing (UAB Kelio
Ženklai) (Level 3)
277
Fair value of net
assets
-
-
Investment entity (UAB MD
partners, investment into
MAIB)** (Level 3)
15,723
Comparable
companies in the
market
P/BV
1.28
P/E
11.88
Net profit, EUR million
34.5
Equity, EUR million
271
Discount for lack of marketability
and country and MAIB risk
49%
Investment entity (UAB
Cedus Invest) (Level 2)
19
Fair value of net
assets
-
-
Dormant SPEs (Level 2)
11
Fair value of net
assets
-
-
BSGF (Level 3)
15,597
Fair value of net
assets determined
by using discounted
cash flows
Discount rate
9.46%-10.8%
Terminal growth rate
1%
EBITDA margin
3.7-16%
INVL Sustainable
Timberland and Farmland
Fund II (investment is held
by consolidated subsidiary)
(Level 3)
2,129
Fair value of net
assets determined
by using discounted
cash flows
Discount rate
5-5.25%
Annual inflation rate
2-4.75%
*Valuation of UAB Įmonių Grupė Inservis include indirectly owned unconsolidated subsidiaries - UAB Priemiestis, UAB Jurita,
UAB Informacinio Verslo Paslaugų Įmonė, SIA Inservis and dormant UAB IPP Integracijos Projektai.
** In 2021 the discount for lack of marketability and political risk of MAIB and of country has been revised. The total discount
rate was reduced from 60% to 49% mainly due to reduction in estimated political risk. The reduction in political risk relates to
positive changes in Moldavian political environment (election of pro-European President and Government) and approved plan
for the bank’s initial public offering.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
57
12 Fair value estimation (cont’d)
Financial instruments carried at fair value (cont’d)
The following table represents inputs and fair value valuation techniques of unconsolidated subsidiaries and associates used by
the Company and the Group as at 31 December 2020:
Profile of activities
Fair value
Valuation
technique
Inputs
Values of inputs
Facility management (UAB
Inservis, UAB Įmonių Grupė
Inservis*) (Level 3)
5,775
Discounted cash
flows
Yearly increase of sales
2%-4.5%
Yearly increase of expenses
3.5%-5%
Discount rate
10.1%
Terminal growth rate
0.5%
Agriculture (UAB Litagra)
(Level 3)
18,085
Fair value of net
assets determined
by using
combination of
discounted cash
flows and sales
comparison method
EBITDA margin
5%-6% and 17%
Discount rate
7.35% and 7.76%
Terminal growth rate
1%
Average value of 1 ha of land, EUR
5,895
Road signs production, wood
manufacturing (UAB Kelio
Ženklai) (Level 3)
297
Fair value of net
assets
-
-
Investment entity (UAB MD
partners, investment into
MAIB)** (Level 3)
7,352
Comparable
companies in the
market
P/BV
0.86
P/E
9.47
Net profit, EUR million
27
Equity, EUR million
235
Discount for lack of marketability
and country and MAIB risk
60%
Investment entity (UAB Cedus
Invest) (Level 2)
84
Fair value of net
assets
-
-
Dormant SPEs (Level 2)
41
Fair value of net
assets
-
-
BSGF (Level 3)
7,492
Fair value of net
assets determined
by using discounted
cash flows
Discount rate
10.59%-11.59%
Terminal growth rate
1%
EBITDA margin
5.3-10.6%
*Valuation of UAB Įmonių Grupė Inservis include indirectly owned unconsolidated subsidiaries - UAB Priemiestis, UAB Jurita,
UAB Informacinio Verslo Paslaugų Įmonė, SIA Inservis and dormant UAB IPP Integracijos Projektai.
**The discount for lack of marketability and country and MAIB risk used for valuation of investment into MAIB has remained
unchanged in 2020 because there were no new transactions in 2020 that would be suitable for recalibration of the discount rate
and also there are no other market indications implying required change in this assumption.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
58
12 Fair value estimation (cont’d)
Financial instruments carried at fair value (cont’d)
The table below presents the effect of changing one or more those assumptions behind the valuation techniques adopted based
on reasonable possible alternative assumptions:
Profile of activities
Unobservable
inputs
Reasonable
possible shift
+/- (absolute
value/bps/%)
Change in Valuation +/-
As at 31 December 2021
As at 31 December 2020
Facility management
(UAB Inservis, UAB
Įmonių Grupė Inservis)
(Level 3)
Discount rate
100 bps
-
(468)/576
Terminal growth rate
50 bps
-
172/(155)
Agriculture (UAB
Litagra)
(Level 3)
Change in average
value of 1 ha of land
1%
116/(116)
109/(109)
Discount rate
100 bps
(1,963)/2,684
(1,631)/2,198
Terminal growth rate
50 bps
949/(811)
766/(659)
Investment entity (UAB
MD partners,
investment into MAIB)
(Level 3)
P/BV
0.1
549/(549)
380/(380)
P/E
0.5
367/(367)
222/(222)
Net profit, EUR
thousand
5%
478/(478)
230/(230)
Discount for lack of
marketability and
country risk
100 bps
(306)/306
(182)/182
BSGF (Level 3)
Discount rate
200 bps
(4,814)/6,891
(506)/1,324
Terminal growth rate
100 bps
392/(1,277)
191/(167)
EBITDA margin
100 bps
3,218/(3,524)
488/(493)
INVL Sustainable
Timberland and
Farmland Fund II
(investment is held by
consolidated
subsidiary) (Level 3)
Discount rate
100 bps
(1,386)/2,472
-
Annual inflation rate
100 bps
2,518/(1,389)
-
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
59
12 Fair value estimation (cont’d)
Financial instruments carried at fair value (cont’d)
The following table presents the Group’s assets and liabilities that are measured at fair value at 31 December 2021:
Level 1
Level 2
Level 3
Total balance
Assets
Unconsolidated subsidiaries
- Facilities management
-
-
7,244
7,244
- Bank sector
-
-
15,723
15,723
- Other activities
-
30
-
30
Associates
- Agriculture
-
-
18,079
18,079
- Real estate
4,402
-
-
4,402
Financial assets at fair value
through profit or loss
- Information technology
5,745
-
-
5,745
- Bank sector
37,039
1,575
-
38,614
- Other ordinary shares
-
2
445
447
- Collective investment undertakings -
funds
-
2,778
18,016
20,794
- Agriculture (loans granted)
-
-
2,239
2,239
- Other activities (loans granted)
-
-
277
277
Total Assets
47,186
4,385
62,023
113,594
Liabilities
-
-
-
-
The following table presents the Company’s assets and liabilities that are measured at fair value at 31 December 2021:
Level 1
Level 2
Level 3
Total balance
Assets
Unconsolidated subsidiaries
- Facilities management
-
-
7,244
7,244
- Bank sector
-
-
15,723
15,723
- Other activities
-
30
-
30
Associates
- Agriculture
-
-
18,079
18,079
- Real estate
4,402
-
-
4,402
Financial assets at fair value
through profit or loss
- Information technology
5,134
-
-
5,134
- Bank sector
24,825
1,575
-
26,400
- Other ordinary shares
-
2
445
447
- Collective investment undertakings -
funds
-
1,370
15,629
16,999
- Agriculture (loans granted)
-
-
2,239
2,239
- Other activities (loans granted)
-
-
277
277
Total Assets
34,361
2,977
59,636
96,974
Liabilities
-
-
-
-
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
60
12 Fair value estimation (cont’d)
Financial instruments carried at fair value (cont’d)
The following table presents the Group’s assets and liabilities that are measured at fair value at 31 December 2020:
Level 1
Level 2
Level 3
Total balance
Assets
Unconsolidated subsidiaries
- Facilities management
-
-
5,775
5,775
- Bank sector
-
-
7,352
7,352
- Other activities
-
125
297
422
Associates
- Agriculture
-
-
18,085
18,085
- Real estate
8,530
-
-
8,530
Financial assets at fair value
through profit or loss
- Information technology
4,272
-
-
4,272
- Bank sector
18,376
-
-
18,376
- Other ordinary shares
-
3
445
448
- Collective investment undertakings -
funds
-
2,740
8,276
11,016
Total Assets
31,178
2,868
40,230
74,276
Liabilities
-
-
18
18
The following table presents the Company’s assets and liabilities that are measured at fair value at 31 December 2020:
Level 1
Level 2
Level 3
Total balance
Assets
Unconsolidated subsidiaries
- Facilities management
-
-
5,775
5,775
- Bank sector
-
-
7,352
7,352
- Other activities
-
125
297
422
Associates
- Agriculture
-
-
18,085
18,085
- Real estate
8,530
-
-
8,530
Financial assets at fair value
through profit or loss
- Information technology
3,808
-
-
3,808
- Bank sector
16,409
-
-
16,409
- Other ordinary shares
-
3
445
448
- Collective investment undertakings -
funds
-
1,335
7,548
8,883
Total Assets
28,747
1,463
39,502
69,712
Liabilities
-
-
-
-
During 2021 and 2020, there were no transfers between Level 1 and Level 2 fair value measurements.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
61
12 Fair value estimation (cont’d)
Financial instruments carried at fair value (cont’d)
Financial instruments in Level 3 (cont’d)
The Group's policy is to recognise transfers into and out of fair value hierarchy levels as of the date of the event or change in
circumstances that caused the transfer.
The following table presents the changes in Level 3 instruments of the Group for the period ended 31 December 2021:
Facilities
management
Agriculture
Bank sector
(MAIB)
Other
activities
Collective
investment
undertakings
Total
Balance at 31 December 2020
5,775
18,085
7,352
742
8,276
40,230
Gains and losses recognised in
profit or loss (within ‘Net changes
in fair value of financial assets at
fair value through profit or loss’)
1,469
(6)
8,371
171
9,064
19,069
Loans granted
-
2,234
-
453
-
2,687
Interest charged
-
5
-
26
-
31
Interest paid
-
-
-
(26)
-
(26)
Acquisition
-
-
-
-
1,064
1,064
Disposal
-
-
-
(644)
(388)
(1,032)
Balance at 31 December 2021
7,244
20,318
15,723
722
18,016
62,023
Change in unrealised gains or
losses for the period included in
profit or loss for assets held at the
end of the reporting period
1,469
(6)
8,371
171
9,064
19,069
The following table presents the changes in Level 3 instruments of the Company for the period ended 31 December 2021:
Facilities
management
Agriculture
Bank sector
(MAIB)
Other
activities
Collective
investment
undertakings
Total
Balance at 31 December 2020
5,775
18,085
7,352
742
7,548
39,502
Gains and losses recognised in
profit or loss (within ‘Net changes
in fair value of financial assets at
fair value through profit or loss’)
1,469
(6)
8,371
171
7,587
17,592
Loans granted
-
2,234
-
453
-
2,687
Interest charged
-
5
-
26
-
31
Interest paid
-
-
-
(26)
-
(26)
Acquisition
-
-
-
-
553
553
Disposal
-
-
-
(644)
(59)
(703)
Balance at 31 December 2021
7,244
20,318
15,723
722
15,629
59,636
Change in unrealised gains or
losses for the period included in
profit or loss for assets held at the
end of the reporting period
1,469
(6)
8,371
171
7,587
17,592
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
62
12 Fair value estimation (cont’d)
Financial instruments carried at fair value (cont’d)
Financial instruments in Level 3 (cont’d)
The following table presents the changes in Level 3 instruments of the Group for the period ended 31 December 2020:
Facilities
management
Agriculture
Bank sector
(MAIB)
Other
activities
Collective
investment
undertakings
Total
Balance at 31 December 2019
4,511
17,256
8,022
1,181
3,787
34,757
Gains and losses recognised in
profit or loss (within ‘Net changes
in fair value of financial assets at
fair value through profit or loss’)
1,264
829
(670)
(492)
(782)
149
Loans granted
-
-
-
40
-
40
Interest charged
-
-
-
13
-
13
Acquisition
-
-
-
-
5,659
5,659
Disposal
-
-
-
-
(388)
(388)
Balance at 31 December 2020
5,775
18,085
7,352
742
8,276
40,230
Change in unrealised gains or
losses for the period included in
profit or loss for assets held at the
end of the reporting period
1,264
829
(670)
(492)
(782)
149
The following table presents the changes in Level 3 instruments of the Company for the period ended 31 December 2020:
Facilities
management
Agriculture
Bank sector
(MAIB)
Other
activities
Collective
investment
undertakings
Total
Balance at 31 December 2019
4,511
17,256
8,022
1,181
3,577
34,547
Gains and losses recognised in
profit or loss (within ‘Net changes
in fair value of financial assets at
fair value through profit or loss’)
1,264
829
(670)
(492)
(828)
103
Loans granted
-
-
-
40
-
40
Interest charged
-
-
-
13
-
13
Acquisition
5,187
5,187
Disposal
(388)
(388)
Balance at 31 December 2020
5,775
18,085
7,352
742
7,548
39,502
Change in unrealised gains or
losses for the period included in
profit or loss for assets held at the
end of the reporting period
1,264
829
(670)
(492)
(828)
103
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
63
12 Fair value estimation (cont’d)
Financial instruments carried at fair value (cont’d)
Financial instruments in Level 3 (cont’d)
The following table presents the changes in the contingent consideration (Level 3 financial liability measurement) of the Group
for the period ended 31 December 2020 and 2021:
2021
2020
Balance at 1 January
(18)
(36)
Gains and losses recognised in profit or loss (within ‘Net changes in fair value of
financial assets at fair value through profit or loss’)
-
-
Paid
18
18
Balance at 31 December
-
(18)
Change in unrealised gains or losses for the period included in profit or loss for assets
held at the end of the reporting period
-
-
13. Financial assets at fair value through profit or loss
Group
Company
2021
2020
2021
2020
Financial assets at fair value through profit or loss (excluding held-for-
trading)
Ordinary shares – quoted
42,784
22,648
29,959
20,217
Derivatives (forward)
1,575
-
1,575
-
Investment funds units
20,793
11,016
16,998
8,883
Ordinary shares - unquoted
448
448
448
448
Loans granted
2,516
-
2,516
-
Total financial assets at fair value through profit or loss
68,116
34,112
51,496
29,548
Non-current financial assets at fair value through profit or loss
63,335
32,945
47,887
29,548
Current financial assets at fair value through profit or loss
4,781
1,167
3,609
-
Investing in AB Šiaulių bankas
On 22 December 2021 the Company signed a Share Purchase-Sale Agreement with the European Bank for Reconstruction and
Development (EBRD). The parties agreed that the Company will directly and/or indirectly acquire from EBRD 35,240,296 shares
of AB Šiaulių bankas by 31 May 2024 at the latest. The shares will not be acquired all at once, but in instalments, in separate
tranches. The parties have agreed that the initial price for AB Šiaulių bankas shares is EUR 0.633 per share and it will be
recalculated during every payment considering dividends paid or other changes in capital by AB Šiaulių bankas, as well as 5%
annual interest calculated from the date of signing the agreement. On 29 December 2021 the consolidated subsidiary INVL Life
UAB completed first tranche by acquiring 11,772,840 shares for the total amount of EUR 7,459 thousand. The agreement provides
that if the shares acquired under this agreement within 18 months. after their acquisition, would be disposed , 50% of the earned
gain must be paid to the EBRD. However, when selling the shares of AB Šiaulių bankas, it is primarily considered that the shares
held by the Group prior to the agreement are being sold. No profit-sharing is foreseen from them.
After first tranche the Group owns 8.1% of the shares of AB Šiaulių bankas. The Company has not made a decision to increase
the number of directly or indirectly owned shares of AB Šiaulių bankas to such an extent that the threshold of 10% of AB Šiaulių
bankas shares is reached or exceeded. In case it is planned to reach or exceed the limit of 10% of AB Šiaulių bankas shares in
any of the subsequent stages of acquisition, the Management Board of the Company will have to reconsider this issue and make
an additional decision on maintaining the existing AB Šiaulių bankas shares and(or) acquiring new shares.
The Company has recognised forward (derivative) at fair value of EUR 1,575 thousand as consequence of obligation to purchase
shares in the future. 11,772,840 shares of AB Šiaulių bankas, owned by the Company was pledged to EBRD to secure obligation
of mentioned above agreement (as at 31 December 2021 carrying amount – EUR 8,959 thousand).
The Company has sold for EUR 249 thousand the 0.05% of shares of AB Šiaulių bankas to INVL Life UAB. The settlement was
deferred and was set-offed in January 2022 by increasing of share capital of INVL Life UAB.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
64
13 Financial assets at fair value through profit or loss (cont’d)
Investing into a closed-end private equity fund INVL Baltic Sea Growth Fund
The Management Board of the Company on 5 February 2019 approved entering into INVL Baltic Sea Growth Fund Partnership
Agreement and a Subscription Agreement related to investment in the closed-end private equity fund INVL Baltic Sea Growth
Fund (hereinafter – BSGF), which is managed by consolidated subsidiary UAB INVL Asset Management. The Company has
committed to invest EUR 20,124 thousand in BSGF. It is provided that the capital committed to the fund will be called in stages,
for the execution of specific transactions. After the investment in BSGF is made, the Company undertakes not to invest in private
equity assets that comply with the fund’s strategy and to conduct its main investment activity through this fund.
In February 2020 was completed third and last closing of BSGF. Fund’s size reached EUR 164.7 million of commitments. After
final closing the Company has owned 12.2% of fund units. As a consequence of equalisation to the Company was refunded EUR
265 thousand and EUR 123 thousand was set-off for new units’ acquisition. During 2020 the Company has transferred EUR 5,008
thousand of cash into BSGF. During 2021 the Company has transferred EUR 521 thousand of cash into BSGF. The outstanding
capital commitment to BSGF is EUR 12,257 thousand.
In 2020 the Group and the Company have additionally invested EUR 2,030 thousand and EUR 158 thousand by cash into other
financial assets at fair value through profit or loss, respectively, and have sold them for EUR 4,718 and EUR 4,078 thousand by
cash, respectively. The Group and the Company have acquired managed investment fund INVL Emerging Europe Bond Subfund
from unconsolidated subsidiary for EUR 217 thousand by set-offing with dividend payable from unconsolidated subsidiary.
In 2021 the Group and the Company have additionally invested EUR 3,224 thousand and EUR 1,523 thousand by cash into other
financial assets at fair value through profit or loss, respectively, and have sold them for EUR 2,925 and EUR 1,417 thousand by
cash, respectively.
14. Loans granted
As at 31 December 2020 and 2021 the Group’s and the Company’s loans granted with nominal value of EUR 682 thousand and
EUR 682 thousand, respectively, were impaired and fully provided for from the year of 2009. As impact of applying of IFRS 9 the
loan granted is written-off, but are still subject to enforcement activity.
15. Trade, other receivables and contract assets
Group
Company
2021
2020
2021
2020
Trade and other receivables, gross
3,823
2,430
373
882
Dividends receivable (including receivable form share capital
decrease)
-
-
60
-
Taxes receivable, gross
3
9
-
-
Contract assets
1,316
303
-
-
Less: allowance for doubtful trade and other receivables
(8)
(8)
-
-
5,134
2,734
433
882
Changes in allowance for doubtful trade and other receivables for the year 2021 and 2020 have been included within ‘Provision
for impairment of financial and contract assets’ expenses in the income statement.
Trade and other receivables are non-interest bearing and are generally on 10–30 days terms. Receivables from related parties
are disclosed in more details in Note 26.
Movements in the allowance for accounts receivable of the Group and the Company were as follows:
Group
Company
Balance as at 31 December 2019
8
-
Charge for the year
-
-
Write-off
-
-
Reversal of amounts previously impaired
-
-
Balance as at 31 December 2020
8
-
Charge for the year
-
-
Write-off
-
-
Reversal of amounts previously impaired
-
-
Balance as at 31 December 2021
8
-
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
65
15 Trade, other receivables and contract assets (cont’d)
The credit risk exposure of trade and other receivables and contract assets of the Group can be assessed on the ageing analysis
disclosed below:
Current
Less than 30
days
30–90 days
90–180 days
More than 180
days
Total
As at 31 December 2021
Trade and other receivables, gross
3,755
-
-
-
68
3,823
Contract assets
1,316
-
-
-
-
1,316
Expected credit losses
-
-
-
-
(8)
(8)
Trade and other receivable and
contact assets net of expected credit
losses
5,071
-
-
-
60
5,131
As at 31 December 2020
Trade and other receivables, gross
2,422
-
-
-
8
2,430
Contract assets
303
-
-
-
-
303
Expected credit losses
-
-
-
-
(8)
(8)
Trade and other receivable and
contract assets net of expected credit
losses
2,725
-
-
-
-
2,725
The credit quality of trade and other receivables of the Company can be assessed on the ageing analysis disclosed below:
Current
Less than 30
days
30–90 days
90–180 days
More than 180
days
Total
As at 31 December 2021
Trade and other receivables, gross
373
-
-
-
60
433
Expected credit losses
-
-
-
-
-
-
Trade and other receivable net of
expected credit losses
373
-
-
-
60
433
As at 31 December 2020
Trade and other receivables, gross
882
-
-
-
-
882
Expected credit losses
-
-
-
-
-
-
Trade and other receivable net of
expected credit losses
882
-
-
-
-
882
EUR 60 thousand is remaining dividends receivable from unconsolidated subsidiary, which would be settled in 2022 after
completion of sales of facilities management entities.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
66
16. Cash and cash equivalents
Group
Company
2021
2020
2021
2020
Cash at bank
5,910
5,741
716
762
5,910
5,741
716
762
Cash at bank earns interest at floating rates based on daily bank deposit rates.
The Group’s and the Company’s cash and cash equivalents did not have any encumbrance.
As at 31 December 2021 and 2020, the Group and the Company had previous term deposits at insolvent AB Bankas Snoras with
the maturity of more than 3 months, which are fully provided for and as impact of IFRS 9 is written-off as at 1 January 2018, but
are still subject to enforcement activity (gross amount EUR 3,122 thousand).
All cash balances have a low credit risk at the reporting date and the impairment loss determined on 12-month expected credit
losses is resulted in an immaterial amount.
The credit quality of cash can be assessed by reference to external credit ratings of the banks:
Group
Company
2021
2020
2021
2020
Moody’s ratings
Prime-1
1,877
653
112
12
Prime-2
4,033
5,088
604
750
Prime-3
-
-
-
-
5,910
5,741
716
762
17. Share capital, share premium and own shares
The total authorised number of ordinary shares is 11,978,573 (as of 31 December 2020: 11,918,899 shares) with a par value of
EUR 0.29 per share. All issued shares are fully paid.
Changes during 2020
On 3 June 2020 78,867 units of the Company’s own shares was sold for EUR 15 thousand to the Group employees exercising
share options granted in 2017 (the selling price per share was EUR 0.20). The acquisition cost of the sold own shares amounted
to EUR 319 thousand. The reserve for the acquisition of own shares was reduced by the loss on disposals of own shares (EUR
304 thousand).
Changes during 2021
On 8 June 2021 the Register of Legal Entities has registered an increased authorized capital of the Company. Since that date the
total number of issued shares is 11,978,573 with a par value of EUR 0.29 per share. Authorized share capital of the Company is
amounted to EUR 3,473,786.17. It was issued 59,674 ordinary registered shares with an issue price of EUR 0.29. The shares
were issued in order to realize the stock options granted in 2018 to the employees of the Group. EUR 0.20 per share was paid in
cash and EUR 0.09 per share was settled from reserve for the grant of shares. Therefore, the share capital is increased by EUR
18 thousand and reserve for the grant of shares was decrease by EUR 5 thousand.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
67
18. Reserves
The movements in legal and other reserves are as follows:
Group
Legal reserve
Reserve for the
acquisition of own
shares
Reserve for
the grant of
shares
Share based
payments
reserve
Total
As at 31 December 2019
509
11,121
900
632
13,162
Transfer to reserves
110
-
-
-
110
Share-based payments
-
-
-
325
325
Disposals of own shares (share
option exercised)
-
(304)
-
-
(304)
As at 31 December 2020
619
10,817
900
957
13,293
Transfer to reserves
90
-
-
(236)
(146)
Share-based payments
-
-
-
584
584
Increase of share capital (share
option exercised)
-
-
(5)
-
-
As at 31 December 2021
709
10,817
895
1,305
13,726
Reserves of the Company is the same as in the Group, except the legal reserve, which is amounted to EUR 473 thousand as at
31 December 2019 and 2020.
Legal reserve
Legal reserve is a compulsory reserve under Lithuanian legislation. Annual transfers of not less than 5 % of net profit, calculated
in accordance with the statutory financial statements, are compulsory until the reserve reaches 10 % of the share capital. The
reserve can be used only to cover the accumulated losses.
Reserve for the acquisition of own shares
Reserve for the acquisition of own shares is formed for the purpose of buying own shares in order to keep their liquidity and
manage price fluctuations. It can be formed by shareholders’ decision at the Annual Shareholders Meeting from the profit
available for distribution. The reserve cannot be used to increase the share capital. The reserve does not change when
Company acquires own shares, but is utilised when own shares are cancelled. The shareholders can decide to transfer unused
amounts of the reserve back to retained earnings at the Annual Shareholders Meeting.
Reserve for the grant of shares
Reserve for the grant of shares is formed when shares are granted by issuing a new share emission. The amount of the reserve
for the grant of shares shall not be less than the sum of the emission price of the shares issued when the shares are granted free
of charge, and (or) difference between the sum of the emission price of the shares issued and the sums paid by the persons
acquiring the shares, when the shares are granted partly in consideration.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
68
18 Reserves (cont’d)
Share-based payments reserve
The share-based payment transactions reserve is used to recognise the value of equity-settled share-based payment transactions
provided to employee of the Group.
The Company every year offered to employees of the Group the share options transaction. With some key employees of the
consolidated subsidiaries is signed formal agreement, which determined principle of bonus remuneration to them. In these
agreements the employee have choice to receive fixed cash or share options. In two consolidated subsidiaries exist bonus plans,
where employees could choose share options as alternative to fixed cash after issuing audited financial statements. the choice of
employee is irrevocable. In all above mentioned cases, the quantity of share option is calculated as division fixed cash amount to
share option value. Latter is calculated as difference between audited consolidated equity per share at year-end or share price at
year-end, which is higher, and option exercise price. The main conditions of share options transactions were:
- The employee has the right to acquire the shares after three years after conclusion of the share options agreements,
early exercising is not allowed;
- Option exercise price – EUR 1;
- Some transactions have service vesting condition. The right to acquire share in the part of transactions come in to force
in future in three years, if the employment contract is not terminated until mentioned dates.
- When the time to exercise is matures the right to acquire the shares will be realized by selling of own shares of the
Company or by offering to sign newly issued shares of the Company to employee;
- The options could not be sold.
The value of share-based payments was calculated using the Black-Scholes formula. For volatility input is used historical shares
volatility on exchange.
Set out below are summaries of options granted by the Company:
Number of options, thousand
2021
2020
Balance as at 1 January
446
242
Granted during year
66
317
Change in accrued number for rendered services at year-end
-
(33)
Forfeited
(1)
(1)
Exercised
(60)
(79)
Balance as at 31 December
451
446
Vested and exercisable at 31 December
172
161
In June 2021 the Group employees exercised share options granted in 2018 by acquiring new issued shares of the Company for
EUR 0.20 per share. Exercise price was decreased from EUR 1 to EUR 0.20 to reflect approved and paid dividends of EUR 0.80
per share. The share price at the date of exercise of share options was EUR 9.5.
On 3 June 2020 the Group employees exercised share options granted in 2017 by acquiring the own shares of the Company for
EUR 0.20 per share. Exercise price was decreased from EUR 1 to EUR 0.20 to reflect approved and paid dividends of EUR 0.80
per share. The share price at the date of exercise of share options was EUR 6.9.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
69
18 Reserves (cont’d)
Share-based payments reserve (cont’d)
Share options outstanding at the end of the year have following expiry dates and inputs to measure fair value:
As at 31 December 2021
Expiry date
Share
options,
thousand
Share
price
Volatility
Expected
dividend yield
Risk-free
interest rate
Fair value
of share
option
Granted on 11 August 2016
30 April 2023
25
4.00
40.87%
0%
(0.422%)
3.06
Granted on 6 May 2019
6 May 2022
69
5.65
30.90%
0%
(0.566%)
4.63
Granted on 25 May 2020
25 May 2023
59
6.75
30.74%
0%
(0.675%)
5.73
Granted on 1 July 2020
15 July 2023
232
7.00
30.76%
0%
(0.667%)
0.71
Granted on 10 May 2021
10 May 2024
66
9.40
30.03%
0%
(0.692%)
8.38
Total
-
451
-
-
-
-
-
As at 31 December 2020
Expiry date
Share
options,
thousand
Share
price
Volatility
Expected
dividend yield
Risk-free
interest rate
Fair value
of share
option
Granted on 11 August 2016
30 April 2023
25
4.00
40.87%
0%
(0.422%)
3.06
Granted on 3 May 2018
3 May 2021
60
5.25
32.38%
0%
(0.423%)
4.24
Granted on 6 May 2019
6 May 2022
69
5.65
30.90%
0%
(0.566%)
4.63
Granted on 25 May 2020
25 May 2023
60
6.75
30.74%
0%
(0.675%)
5.73
Granted on 1 July 2020
15 July 2023
232
7.00
30.76%
0%
(0.667%)
0.71
Total
-
446
-
-
-
-
-
In 2021 and 2020 the share-based payment expenses were recognised in the income statement of the Company and the Group
within ”Employee benefits expenses” as the fair value of share options. In 2021 and 2020 the Group recognized EUR 216 thousand
and EUR 129 thousand of expenses from equity settled share-based payment transaction, respectively. In 2021 and 2020 on the
Group level liability of EUR 368 thousand and EUR 196 thousand was reclassified to the share based payment reserve,
respectively, when employees chose share option instead of cash alternative. In 2021 and 2020 the Group has recognised EUR
1,247 thousand and 736 EUR thousand from cash alternative of share based payment transaction. In 2021 the Company has
recognised EUR 29 thousand of expenses and EUR 555 thousand as additional investment to consolidated subsidiaries. In 2020
the Company has recognised EUR 26 thousand of expenses and EUR 298 thousand as additional investment to consolidated
subsidiaries. The unrecognised liability from cash alternative of share-based payment arrangement for unvested service condition
is amounted to EUR 246 thousand (2020: EUR 236 thousand). The unrecognised expenses from equity settled share-based
payment transaction for unvested service condition is amounted to EUR 153 thousand (2020: EUR 196 thousand).
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
70
19. Borrowings
In July 2020 the Company has received EUR 27 thousand borrowings from UAB Aktyvo. Weighted average effective interest rates
of borrowings during the year:
Group
Company
2021
2020
2021
2020
Borrowings
3.00%
3.00%
3.00%
3.00%
Changes in liabilities arising from financing activities (borrowings) are presented in the table below (changes in lease liabilities is
presented in Note 25):
Company
Borrowings
As at 31 December 2019
-
Borrowings received during year
27
Interest paid
-
Interest expenses
1
As at 31 December 2020
28
Borrowings repaid during year (set-off with receivable from share capital decrease)
(28)
As at 31 December 2021
-
20. Trade payables
Trade payables are non-interest bearing and are normally settled on 14–60 day terms. For terms and conditions relating to related
parties please refer to Note 26.
21. Contract liabilities
Movement in the account of contract liabilities is presented below:
Group
2021
2020
Balance as at 1 January
1,206
785
During period received cash for satisfying of performance obligation
462
532
Recognised revenue during period partly satisfied performance obligation
(158)
(111)
Balance as at 31 December
1,510
1,206
Non-current
1,326
1,068
Current
184
138
Revenue recognised from amounts included in contract liabilities at the beginning of
the year
138
85
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
71
22. Other liabilities
The other current and non-current liabilities are presented in the table below:
Group
Company
2021
2020
2021
2020
Financial liabilities
Dividends payable
580
613
580
613
Contingent consideration – financial liabilities at fair value through
profit or loss
-
18
-
-
Other amounts payable
404
269
65
19
984
900
645
632
Non – financial liabilities
Salaries, bonus plans (excluding cash alternative of share-based
payment arrangement) and social security payable
985
729
123
114
Cash alternative of share-based payment arrangement and social
security payable
1,380
835
-
-
Tax payable
12
16
2
-
2,377
1,580
125
114
Total other current and non-current liabilities
3,361
2,480
770
746
Non-current liabilities
163
136
-
-
Current liabilities
3,198
2,344
770
746
23. Financial risk management
23.1. Financial risk factors
The risk management function within the Group is carried out in respect of financial risks (credit, market and liquidity), operational
risks and legal risks. On an overall Group level strategical risk management is executed by the Board of Directors. Operational
risk management is carried out at each entity level by directors. The primary objectives of the financial risk management function
are to establish risk limits, and then ensure that exposure to risks stays within these limits. The operational and legal risk
management functions are intended to ensure proper functioning of internal policies and procedures to minimise operational and
legal risks.
The Group’s and the Company’s principal financial liabilities comprise trade and other payables. The main purpose of these
financial liabilities is to raise finance for the Group’s and the Company’s operations. The Group and the Company have various
financial assets such as trade and other receivables, loans granted, investments in equity and debt securities, deposits held in
banks and cash which arise directly from its operations. The Group and Company have not used any of derivative instruments for
hedging so far, as management considered that there is no necessity for them.
The Group is being managed the way so its main businesses would be separated from each other. This is to diversify the
operational risk and create conditions for selling any business avoiding any risk to the Company and the Group.
The Company’s policy is to not provide any guarantee or surety for the Group‘s companies. The Group‘s companies do not provide
any guarantees one against another usually.
The main risks arising from the financial instruments are market risk (including currency risk, cash flow and fair value interest rate
risk and price risk), liquidity risk and credit risk. The risks are identified and disclosed below.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
72
23 Financial risk management (cont’d)
23.1 Financial risk factors (cont’d)
Credit risk
Credit risk is the risk one party to a financial instrument will cause a financial loss for the other party by failing to discharge an
obligation. Credit risk arises from cash and cash equivalents, deposits with banks and financial institutions, as well as credit
exposures to outstanding trade receivables, loans granted and debt securities.
The Group estimates the credit risk separately by the segments.
The maximum exposure to credit risk and impairment of trade and other receivables and loans granted is disclosed in Notes 14
and 15. The maximum exposure to credit risk for loans granted classified as ‘financial assets at fair value through profit or loss’ in
2021 and as ‘investments to unconsolidated subsidiaries and associate measured at fair value through profit or loss’ in 2020 are
their carrying amounts (EUR 297 thousand as at 31 December 2020 and EUR 2,516 thousand as at 31 December 2021). In Note
15 is also disclosed credit risk exposure of trade receivable. There are no significant transactions of the Group or the Company
that occur outside Lithuania and Latvia.
With respect to credit risk arising from other financial assets of the Group and the Company, which comprise deposits at banks
and cash and cash equivalents, the Group’s and the Company’s exposure to credit risk arises from default of the counterparty,
with a maximum exposure equal to the carrying amount of these instruments.
The maximum exposure to credit risk from financial assets are:
Group
Company
2021
2020
2021
2020
Trade and other receivables
3,815
2,422
433
882
Loans granted
2,516
297
2,516
297
Cash at bank
5,910
5,741
716
762
12,241
8,460
3,665
1,941
Cash flow and fair value interest rate risk
The Group’s and the Company’s exposure to the risk of changes in market interest rates relates primarily to the debt obligations
with floating interest rates and to the owned bonds.
The Group and the Company do not have any borrowing as at 31 December 2021. The Company and the Group have borrowings
from unconsolidated subsidiary with fixed interest rates for one year at 31 December 2020. The Company and the Group have
loans granted to their previous unconsolidated subsidiaries and to associates with fixed interest rates for one year. Therefore, the
Group and the Company are not exposed to cash flow interest rate risk from loans granted.
Share price risk
The Group and the Company are exposed to equity securities price risk because of investments held by the Group and the
Company and classified on the statement of financial position at fair value through profit or loss. The Group and the Company are
not exposed to commodity price risk. To manage their price risk arising from investments in equity securities, the Group and the
Company diversify their portfolio.
The Group’s and the Company’s investments in equity of other entities that are publicly traded are included in the equity index:
OMX Baltic Benchmark Gross Index (OMXBBGI).
The table below summarises the impact of increases/decreases of the equity index on the Group’s and the Company’s profit
before tax for the year. The analysis is based on the assumption that the equity index had increased/decreased by 20% with all
other variables held constant and all the Group’s and Company’s equity instruments moved according to the historical correlation
with the index:
Index
Group
Company
2021
2020
2021
2020
OMXBBGI
6,819
4,480
6,083
3,994
Profit before tax for the year would increase/decrease as a result of gains/losses on equity securities classified at fair value through
profit or loss.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
73
23 Financial risk management (cont’d)
23.1 Financial risk factors (cont’d)
Foreign exchange risk
As a result of operations the statement of financial position of the Group can be affected by movements in the reporting currencies’
exchange rates. The Group’s and the Company’s policy is related to matching of money inflows from the most probable potential
sales with purchases by each foreign currency. The Group and the Company do not apply any financial instruments allowing to
hedge foreign currency risks, because these risks are considered insignificant.
The foreign currency risk at the Group and the Company is not large, taking into consideration that most monetary assets and
obligations are denominated in euro. As at 31 December 2021 and 2020 the Group and Company have insignificant assets
denominated in foreign currency.
Liquidity risk
The Group’s and the Company’s policy is to maintain sufficient cash and cash equivalents or have available funding through an
adequate amount of committed credit facilities to meet their commitments at a given date in accordance with strategic plans. The
liquidity risk of the Group and the Company is controlled on a level of consolidated subsidiaries. The Group’s and the Company’s
objective is to maintain a balance between continuity of funding and flexibility through the use of borrowings. The liquidity risk
management is divided into long-term and short-term risk management.
The aim of the short-term liquidity management is to meet daily needs for funds. Each operating segment is independently
planning its internal cash flows. Short-term liquidity for the Group and the Company is controlled through monthly monitoring of
the liquidity status and needs of funds according to the Group’s operating segments.
Long-term liquidity risk is managed by analysing the predicted future cash flows taking into account the possible financing sources.
Before approving the new investment projects the Group and the Company evaluate the possibilities to attract needed funds. The
general rule is applied in the Group to finance the Group companies or to take loans from them through the parent company in
order to minimise the presence of direct borrowings between the companies of different operating segments.
The table below summarises the maturity profile of the Group’s financial liabilities as at 31 December 2021 and 2020 based on
contractual undiscounted payments.
On demand
Less than
3 months
4 to 12
months
2 to 5
years
More than
5 years
Total
Lease liabilities
-
101
292
1,081
-
1,474
Trade and other payables
-
299
100
-
-
399
Other liabilities
580
404
-
-
-
984
Balance as at 31 December 2021
580
804
392
1,081
-
2,857
Lease liabilities
-
100
293
1,370
-
1,763
Trade and other payables
-
229
-
-
-
229
Financial liabilities at fair value
-
-
18
-
-
18
Other liabilities
613
268
1
-
-
882
Balance as at 31 December 2020
613
597
312
1,370
-
2,892
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
74
Financial risk management (cont’d)
23.1 Financial risk factors (cont’d)
Liquidity risk (cont’d)
The table below summarises the maturity profile of the Company’s financial liabilities as at 31 December 2021 and 2020 based
on contractual undiscounted payments.
On demand
Less than
3 months
4 to 12
months
2 to 5
years
More than
5 years
Total
Financial lease liabilities
-
7
20
79
-
106
Trade and other payables
-
50
-
-
-
50
Other current liabilities
580
65
-
-
-
645
Balance as at 31 December 2021
580
122
20
79
-
801
Financial lease liabilities
-
6
19
98
-
123
Trade and other payables
-
3
-
-
-
3
Other current liabilities
613
19
-
-
-
632
Balance as at 31 December 2020
613
28
19
98
-
758
The Group’s liquidity ratio (total current assets / total current liabilities) as at 31 December 2021 was approximately 3.22 (3.00 as
at 31 December 2020). The Company’s liquidity ratio as at 31 December 2021 was approximately 3.11 (2.11 as at 31 December
2020). The Group’s and the Company's management considers the liquidity position of the Group and the Company based on the
current market conditions and takes actions to keep the favourable situation.
23.2. Capital management
The primary objective of the capital management is to ensure that the Group and the Company maintain a strong credit health
and healthy capital ratios in order to support their business and maximise shareholder value. The Company‘s management
supervises the investments so that they are in compliance with requirements applied to the capital, specified in the appropriate
legal acts and credit agreements, as well as provide the Group’s management with necessary information.
The Group‘s and the Company‘s capital comprises share capital, share premium, reserves and retained earnings.
The Group and the Company manage their capital structure and make adjustments to it, in light of changes in economic conditions
and specific risks of their activity. To maintain or adjust the capital structure, the Company may adjust the dividend payment to
shareholders, return capital to shareholders or issue new shares. No changes were made in the objectives, policies or processes
during the year 2021 and 2020.
The Company is obliged to keep its equity ratio at not less than 50 % of its share capital, as imposed by the Law on Companies
of Republic of Lithuania. As at 31 December 2021 and 2020 all the Group consolidated subsidiaries comply with above mentioned
requirement. Pursuant to the Law on State Funded Pensions of Republic of Latvia the authorised share capital of an investment
management entity must be not less than EUR 2,000,000, if it managed pension funds of total assets more than 100 million, but
up to EUR 200 million, and must be not less than EUR 3,000,000, if it managed pension funds of total assets more than EUR 200
million. As of 31 December 2021 and 2020 IPAS INVL Asset Management complied with this requirement.
The Company’s consolidated subsidiaries UAB INVL Asset Management and UAB FMĮ INVL Finasta are managing their capital
and all relevant risks in accordance with requirements set by the Bank of Lithuania. The Company’s consolidated subsidiary IPAS
INVL Asset Management is managing their capital and all relevant risks in accordance with requirements set by the Financial and
Capital Market Commission of Latvia. Internally there was approved a common risk level – to which extent the minimal capital
adequacy requirement would not be violated and there would not be a real threat of its violation. UAB INVL Asset Management
ensure that the capital adequacy ratio which is calculated dividing the entity’s own funds by the required amount of capital
according to the Bank of Lithuania requirements would be at least 1.0. Following the EU Regulation 2019/2033 on Prudential
Requirements of Investment Firms which came into force in 2021, UAB FMĮ INVL Finasta ensures that the capital adequacy ratio
which is calculated dividing the entity’s own funds by the total risk exposure amount according to the Bank of Lithuania
requirements would be at least 100% (till 2020 the required capital adequacy ratio calculated according to previous regulations
was at least 8%). IPAS INVL Asset Management own funds may never be lower than the higher of: 1) the sum total of the minimum
initial capital and additional total own funds or 2) 25 per cent of the sum total amount of the fixed costs or fixed overheads of the
previous full reporting year. As at 31 December 2021 and 2020 the above mentioned consolidated subsidiaries complied with
these requirements.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
75
24. Commitments and contingencies
Funds and individual portfolios managed by the Group
The table below presents the net assets or commitments of the Group’s managed funds (depends from what amount management
fees is calculated) and individual portfolios and capitalisation of managed closed-end investment companies (cross-holding is not
excluded):
2021
2020
unaudited
unaudited
2
nd
pillar pension funds
1,002,488
753,359
3
rd
pillar pension funds
82,628
56,232
Investment funds
53,948
52,015
Portfolios of clients
99,822
87,283
Alternative investments funds
311,140
241,700
Closed-end investment companies
52,143
53,512
Total
1,602,169
1,244,101
Assets of clients held as custody by the Group
As at 31 December 2021 consolidated subsidiary UAB FMĮ „Finasta“ held as custody EUR 142,513 thousand of clients’ assets
(securities and cash; as at 31 December 2020 – EUR 125,549 thousand).
BSGF
As at 31 December 2021 the outstanding commitment of the Company to invest to BSGF is amounted to EUR 12,257 EUR, to
invest to other funds is amounted to EUR 168 thousand.
As at 31 December 2020 the outstanding commitment of the Company to invest to BSGF is amounted to EUR 12,778 EUR.
As at 31 December 2021 the outstanding commitment of the Group to invest to funds is amounted to EUR 13,860 EUR
As at 31 December 2020 the outstanding commitment of the Group to invest to BSGF is amounted to EUR 13,709 EUR.
Tax legislation
Tax authorities have right to examine accounting records of the Company and its consolidated subsidiaries in Lithuania at any
time during the current period and for 3 previous years before the reporting period, in some cases 5 or 10 years before the
reporting period, and account for additional taxes and fines. In the opinion of the Company’s management, currently there are no
circumstances which would raise substantial tax liability in this respect to the Company and to the Group. Activity in the Republic
of Latvia is not subject to corporate income tax. Instead of taxation on the profit of the current year, the tax is applied only upon
profit distribution, i.e. upon payment of dividends.
Commitment for not yet commenced lease is disclosed in Note 25 below.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
76
25. Lease
The Company has lease contract for premises and parking spaces. The lease term is until 2025. The lease contract has not any
termination and extension option. The Company could only sub-lease premises to the Group companies, but has not entered in
any sublease agreements. The Group has several lease contracts for premises and parking spaces. The lease terms were until
2022 and 2025, except leases, which are less than 12 months and for which Group applies the ‘short-term lease’ recognition
exemption. As at 31 December 2020 the lease term was between 2021 and 2025. The Group’s lease agreements have not
unilaterally extension options. Some agreements have termination options, but the Group does expect to use them. Generally,
the Group is restricted from assigning and subleasing the leased assets, excluding that in some contracts is determined right to
sub-lease premises to the Group companies. But the Group has not entered in any sublease agreements, most of leases has
lease indexation clause based on customer price index change. The terms of lease do not include restrictions on the activities of
the Group and the Company in connection with the dividends, additional borrowings or additional lease agreements.
Right- of-use assets are presented as property, plant and equipment and is disclosed in Note 9. The maturity analysis of leases
liabilities is disclosed in Note 23.1 (section liquidity risk).
The following is the amounts recognised in profit or loss in 2021:
Group
Company
Depreciation charge for right-of-use assets
(331)
(19)
Interest expenses (included in finance cost)
(81)
(8)
Expense relating to short-term lease
(10)
-
The following is the amounts recognised in profit or loss in 2020:
Group
Company
Depreciation charge for right-of-use assets
(297)
(18)
Interest expenses (included in finance cost)
(130)
(10)
Expense relating to short-term lease
(12)
-
Changes in liabilities arising from financing activities (lease liabilities) are presented in the table below:
Group
Company
As at 1 January 2020
1,609
110
Lease payments
(250)
(14)
Interest paid
(130)
(10)
Interest expenses
130
10
Addition
85
2
Derecognition
(6)
-
As at 31 December 2020
1,438
98
Lease payments
(294)
(18)
Interest paid
(81)
(8)
Interest expenses
81
8
Addition
267
20
Derecognition
-
-
As at 31 December 2021
1,411
100
The Group has lease contract that have not yet commenced at 31 December 2021. The future lease payments for the non-
cancellable lease contract are EUR 107 thousand within one year, EUR 352 thousand between 2 and 5 years after 31 December
2021.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
77
26. Related party transactions
The parties are considered related when one party has the possibility to control the other one or have significant influence over
the other party in making financial and operating decisions.
The related parties of the Group in 2021 and 2020 were unconsolidated subsidiaries, associates, the shareholders of the
Company, who have joint control or significance influence (Note 1) and key management personnel, including companies under
control or joint control of key management and shareholders having significant influence or joint control and including companies,
where shareholders having joint control over the Company are key management personnel or having significant influence. To the
other related parties are attributed entities left the Group during split-off occurred in 2014, because shareholders having joint
control over the Company are key management personnel of these entities or having significant influence and managed funds.
Receivables from related parties are presented in carrying amount. They include loans granted to unconsolidated subsidiaries
and associates, that are considered as part of investments to unconsolidated subsidiaries and associates. Interest income and
expenses are presented in the ‘revenue and other income’ and ‘purchases’ columns, respectively.
Transactions of the Group with unconsolidated subsidiaries in 2021 and balances as at 31 December 2021 were as follows:
2021
Group
Revenue and
other income from
related parties
Purchases
from
related
parties
Receivables from related
parties (including presented
in carrying value of
investments)
Payables to
related parties
Loans and borrowings
6
1
-
-
Dividends
1,493
-
60
-
Accounting services
4
-
-
-
Acquisition or disposals of investments
4,802
-
-
-
6,305
1
60
-
Transactions of the Group with associates in 2021 and balances as at 31 December 2021 were as follows:
2021
Group
Revenue and
other income from
related parties
Purchases from
related parties
Receivables from
related parties
Payables to
related parties
Loans and borrowings
5
-
2,239
-
Dividends
2,423
-
-
-
Management and success fees
1,725
-
1,533
-
Accounting services
25
-
-
-
Other services
15
-
-
-
4,193
-
3,772
-
The maturity of loans granted is 2022, effective interest rate is fixed at 4.5 %. Loans hold no collateral.
Transactions of the Group with other related parties in 2021 and balances as at 31 December 2021 were as follows:
2021
Group
Revenue and
other income from
related parties
Purchases from
related parties
Receivables from
related parties
Payables to
related parties
Accounting services
33
-
-
-
The group of UTIB INVL Technology
(information technology maintenance
services)
-
238
-
23
The group of AB INVL Baltic Farmland (land
administration services)
175
-
62
-
Management fee (for UTIB INVL
Technology)
603
-
167
-
Other services
21
1
-
-
832
239
229
23
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
78
26 Related party transactions (cont’d)
Transactions of the Group with unconsolidated subsidiaries in 2020 and balances as at 31 December 2020 were as follows:
2020
Group
Revenue and
other income from
related parties
Purchases
from
related
parties
Receivables from related
parties (including presented
in carrying value of
investments)
Payables to
related parties
Loans and borrowings
13
1
297
28
Dividends
495
-
-
-
Accounting services
2
-
-
-
Donation
-
28
-
-
Acquisition or disposals of investments
1,081
217
800
-
Other services
1
4
-
4
1,592
250
1,097
32
The maturity of loans granted is 2021, effective interest rate is fixed at 4.5 %. Loans hold no collateral. The Group classifies part
of loans granted as long term, because has policy to prolong them on maturity date. The maturity of borrowings is 2021, effective
interest rate is fixed at 3 %.
Transactions of the Group with associates in 2020 and balances as at 31 December 2020 were as follows:
2020
Group
Revenue and
other income from
related parties
Purchases from
related parties
Receivables from
related parties
Payables to
related parties
Loans and borrowings
13
-
-
-
Rent and utilities services
3
240
-
-
Dividends
6,605
-
-
-
Management and success fees
1,697
-
27
-
Accounting services
15
-
-
-
Other services
6
-
2
-
8,339
240
29
-
Transactions of the Group with other related parties in 2020 and balances as at 31 December 2020 were as follows:
2020
Group
Revenue and
other income from
related parties
Purchases from
related parties
Receivables from
related parties
Payables to
related parties
Accounting services
16
-
-
-
The group of UTIB INVL Technology
(information technology maintenance
services)
-
137
-
13
The group of AB INVL Baltic Farmland (land
administration services)
206
-
126
-
Management fee (for UTIB INVL
Technology)
471
-
124
-
Other services
10
3
10
-
703
140
260
13
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
79
26 Related party transactions (cont’d)
The Company’s related parties were the subsidiaries, associates, joint ventures, shareholders, who have joint control or
significance influence (Note 1), key management personnel, companies under control or joint control of key management and
shareholders with significant influence or joint control and companies, where shareholders having joint control over the Company
are key management personnel or having significant influence. To the other related parties are also attributed entities left the
Group during split-off occurred in 2014, because shareholders having joint control over the Company are key management
personnel of these entities or having significant influence.
Transactions of the Company with subsidiaries in 2021 and balances as at 31 December 2021 were as follows:
2021
Company
Revenue and
other income from
related parties
Purchases from
related parties
Receivables from
related parties
Payables to
related parties
Loans and borrowings
6
1
-
-
Dividends
3,448
-
60
-
Transfer of tax losses
62
-
-
-
Accounting services
6
-
-
-
Acquisition or disposals of investments
4,802
-
249
-
Other services
18
3
16
3
8,342
4
325
3
Transactions of the Company with associates in 2021 and balances as at 31 December 2021 were as follows:
2021
Company
Revenue and
other income from
related
Parties
Purchases from
related parties
Receivables from
related parties
Payables to
related parties
Loans and borrowings
5
-
2,239
-
Dividends
2,423
-
-
-
Accounting services
25
-
-
-
Other services
3
-
-
-
2,456
-
2,239
-
The maturity of loans granted is 2022, effective interest rate is fixed at 4.5 %. Loans hold no collateral.
Transactions of the Company with other related parties in 2021 and balances as at 31 December 2021 were as follows:
2021
Company
Revenue and
other income from
related parties
Purchases from
related parties
Receivables from
related parties
Payables to
related parties
The group of UTIB INVL Technology
(information technology maintenance
services)
-
8
-
1
Accounting services
33
-
-
-
Other services (insurance costs
compensation)
21
-
-
-
54
8
-
1
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
80
26 Related party transactions (cont’d)
Transactions of the Company with subsidiaries in 2020 and balances as at 31 December 2020 were as follows:
2020
Company
Revenue and
other income from
related parties
Purchases from
related parties
Receivables from
related parties
Payables to
related parties
Loans and borrowings
13
1
297
28
Dividends
2,188
-
-
-
Transfer of tax losses
64
-
-
-
Accounting services
2
-
-
-
Acquisition or disposals of investments
1,081
217
800
-
3,348
218
1,097
28
The maturity of loans granted is 2021, effective interest rate is fixed at 4.5 %. Loans hold no collateral. The Company classifies
part of loans granted as long term, because has policy to prolong them on maturity date. The maturity of borrowings is 2021,
effective interest rate is fixed at 3 %.
Transactions of the Company with associates in 2020 and balances as at 31 December 2020 were as follows:
2020
Company
Revenue and
other income from
related
Parties
Purchases from
related parties
Receivables from
related parties
Payables to
related parties
Loans and borrowings
13
-
-
-
Rent and utilities services
-
22
-
-
Dividends
6,117
-
-
-
Accounting services
15
-
-
-
Other services
-
-
2
-
6,145
22
2
-
Transactions of the Company with other related parties in 2020 and balances as at 31 December 2020 were as follows:
2020
Company
Revenue and
other income from
related parties
Purchases from
related parties
Receivables from
related parties
Payables to
related parties
The group of UTIB INVL Technology
(information technology maintenance
services)
-
12
-
1
Accounting services
16
-
-
-
Other services
10
-
10
-
26
12
10
1
The movements of loans granted to associates were:
Group
Company
2021
2020
2021
2020
At 1 January
-
1,506
-
1,506
Loans granted during year
2,234
-
2,234
-
Loans repayment received
-
(1,500)
-
(1,500)
Interest charged
5
13
5
13
Interest received
-
(19)
-
(19)
At 31 December
2,239
-
2,239
-
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
81
26 Related party transactions (cont’d)
The movements of loans granted to subsidiaries were:
Group
Company
2021
2020
2021
2020
At 1 January
297
244
297
244
Loans granted during year
55
40
55
40
Reclassification to financial assets at fair value due to disposals
(352)
-
(352)
-
Loans and interest converted to increased share capital
-
-
-
-
Changes in fair value of loans
-
-
-
-
Interest charged
6
13
6
13
Interest received
(6)
-
(6)
-
At 31 December
-
297
-
297
The movements of borrowings from subsidiaries were:
Group
Company
2021
2020
2021
2020
At 1 January
28
-
28
-
Borrowings received during year
-
27
-
27
Borrowings repaid during year (set-off with receivable from share
capital decrease)
(28)
-
(28)
-
Interest charged
-
1
-
1
Interest paid
-
-
-
-
At 31 December
-
28
-
28
Key management compensation and other payments
The management remuneration contains short-term employees’ benefits and share-based payments. In 2021 and 2020 key
management of the Company and Group includes Board members and Chief financial officer of the Company.
Group
Company
2021
2020
2021
2020
Wages, salaries and bonuses
289
313
288
312
Social security contributions
5
6
5
6
Share-based payments
24
26
24
26
Transfers to pension funds
11
-
11
-
Total key management compensation
329
345
328
344
There were no loans granted during the reporting period or outstanding at the end of the reporting period. In 2021 dividends were
not paid.
In 2020 to the Board members, which are shareholders of the Company, were paid EUR 780 thousand of dividends, net of tax.
To the entities, which are controlled by the Board members, were paid EUR 4,734 thousand of dividends, net of tax. To the natural
persons related to the Board members the Company paid EUR 2,453 thousand of dividends, net of tax.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
(all amounts are in EUR thousand unless otherwise stated)
82
27. Impact of COVID-19
In 1
st
Quarter of 2020 the COVID-19 virus pandemic resulted a decrease in the fair value of the Group's and the Company's
financial assets at fair value through profit or loss due to a decrease in the market price of listed companies. This directly
contributed to the decline in the value of Level 1 and Level 2 financial assets and indirectly contributed to the decline in the value
of Level 3 financial assets due to the decrease of the market value of comparable companies. This decline also reduced the
Group's income generated from the management fee received for the managed investment products in 2020. In the subsequent
periods this effect was reversed. Operations of the Group and the Company were not significantly affected by the COVID-19 virus
pandemic. Due to the quarantine announced in Lithuania Group's and the Company’s operations were not disrupted, as the Group
can perform all the operations remotely. Consolidated and unconsolidated subsidiaries of the Group have received state financial
support for staff downtime during the quarantine. The Company did not request or received any financial support due to the
COVID-19 virus pandemic. The Group/Company did not expect later to face significant impact of the COVID-19 virus pandemic.
28. Events after the reporting period
Disposals of financial assets of the Company and increase share capital of INVL Life UAB
The Company has additional invested EUR 40,500 thousand into share capital of consolidated subsidiaries INVL Life UAB.
Investment was made by transferring EUR 3,856 thousand of cash and by set-off of receivables from sold financial assets
Including sale of 0.05% shares of AB Šiaulių Bankas in December 2021. The Company has sold to INVL Life UAB these financial
assets in January 2021:
- 23.43% of INVL Baltic Real Estate for EUR 4,364 thousand;
- 15.39% of UTIB INVL Technology for EUR 5,209 thousand;
- 100% of shares of UAB Cedus Invest, through which the Company has invested in Litagra group, for initial amount of
EUR 17,460 thousand, the sale price would be adjusted to fair value of shares as at 31 December 2021;
- part, equal to EUR 7,621,959.71 capital contributed, of the units of BSGF for initial amount of EUR 9,363 thousand, the
sale price would be adjusted to fair value of units as at 31 December 2021 (outstanding capital commitment is not
transferred).
After completion of capital formation INVL Life UAB has received in March 2022 a licence to conduct life insurance activities and
continue preparations for the acquisition of the Baltic business of the Finnish life insurance company Mandatum Life.
Impact of invasion of the Russian Federation to Ukraine
The Group/the Company has not owned any assets and does not perform any operation in Ukraine, Russia, and Belarus.
Therefore invasion of the Russian Federation to Ukraine, occurred on 24 February 2022, has not any significant impact on the
Group/the Company activities. The Group/the Companies results could be affected by the decrease of market price of listed
companies as is described in Note 27 regarding impact of COVID-19 in 2020.
AB INVALDA INVL
Consolidated Annual Report for 2021
CONSOLIDATED ANNUAL REPORT FOR 2021 | 84
Translation note:
This version of the Annual Report is a translation from the original, which was prepared in Lithuanian language.
All possible care has been taken to ensure that the translation is an accurate representation of the original.
However, in all matters of interpretation of information, views or opinions, the original language version takes
precedence over this translation.
CONTENTS
A WORD FROM THE PRESIDENT OF THE COMPANY ........................................................................................... 86
I. GENERAL INFORMATION .............................................................................................................................. 87
1. Reporting period for which the report is prepared ............................................................................... 87
2. General information about the Issuer and other companies comprising the group ............................ 87
II. FINANCIAL INFORMATION AND SIGNIFICANT EVENTS ..................................................................................... 89
3. Business environment ........................................................................................................................ 89
4. Performance results of the issuer and the group ................................................................................ 90
5. Information on the group’s activities .................................................................................................... 91
5.1. Asset Management business ....................................................................................................... 91
5.2. Other major investments .............................................................................................................. 93
6. Estimation of Issuer’s and Group’s activity last year and activity plans and forecasts ....................... 94
6.1. Evaluation of implementation of goals for 2021 ........................................................................... 94
6.2. COVID-19 pandemic impact assessment .................................................................................... 95
6.3. Activity plans and forecasts .......................................................................................................... 95
III. INFORMATION ABOUT SECURITIES ............................................................................................................. 95
7. Information about Issuer’s authorised capital...................................................................................... 95
7.1. Adjustments of the authorised capital ........................................................................................... 95
7.2. Structure of the authorized capital as of 31 december 2021 ........................................................ 96
7.3. Information about the issuer’s treasury shares ............................................................................ 96
7.4. Information about employees stock options ................................................................................. 97
8. The order of amendment of Issuer’s Articles of Association ............................................................... 97
9. Shareholders ....................................................................................................................................... 98
9.1. Information about shareholders of the company .......................................................................... 98
9.2. Rights and obligations carried by the shares ............................................................................... 99
10. Dividends ......................................................................................................................................... 100
11. Trading in Issuer’s securities as well as securities of the group companies’ .................................. 100
11.1. Trading in Issuer’s securities .................................................................................................... 100
11.2. Trading in securities of the group companies’ .......................................................................... 103
IV. ISSUER’S MANAGING BODIES .................................................................................................................. 103
12. Structure, authorities, the procedure for appointment and replacement ......................................... 103
12.1. General Shareholders’ Meeting ................................................................................................ 103
12.2. The Board ................................................................................................................................. 105
12.3. The President ........................................................................................................................... 107
13. Information about members of the Board, CFO and the Audit Committee of the Company .......... 107
14. Information about the Audit Committee of the company ................................................................. 109
15. Information on the amounts calculated by the Issuer, other assets transferred and guarantees granted to
the Members of the Board, the president and CFO .............................................................................. 111
V. OTHER INFORMATION .............................................................................................................................. 111
CONSOLIDATED ANNUAL REPORT FOR 2021 | 85
16. Agreements with intermediaries on public trading in securities ...................................................... 111
17. Information on Issuer’s branches and representative offices .......................................................... 111
18. Risk management ........................................................................................................................... 111
18.1. A description of the principal risks and uncertainties ............................................................... 111
18.2. Information about the extent of risk and its management in the Company .............................. 113
18.3. The main indications about internal control and risk management systems related to the
preparation of consolidated financial statements .............................................................................. 113
18.4. Information on financial risk management objectives used for hedging measures which hedge
accounting ......................................................................................................................................... 113
19. Issuer’s and its group companies’ non – financial results. Information related to employees ........ 113
19.1. Employees ................................................................................................................................ 113
19.2. Information about agreements of the Company and the members of the Board, or the employees’
agreements providing for compensation in case of the resignation or in case they are dismissed without a
due reason or their employment is terminated in view of the change of the control of the Company.114
20. Memberships in associations .......................................................................................................... 114
21. Information on harmful transactions in which the issuer is a party ................................................. 115
22. Information on the related parties’ transactions .............................................................................. 115
23. Information about significant agreements to which the issuer is a party, which would come into force, be
amended or cease to be valid if there was a change in issuer‘s controlling shareholder, and their impact117
24. Significant investments made during the reporting period and after the end of the financial year . 117
25. References to and additional explanations of the data presented in the financial statements and
consolidated financial statements ......................................................................................................... 118
26. Data on the publicly disclosed information ...................................................................................... 118
27. Information on audit company ......................................................................................................... 120
APPENDIX 1. INFORMATION ABOUT GROUP COMPANIES, THEIR CONTACT DETAILS ........................................... 121
APPENDIX 2. DISCLOSURE CONCERNING THE COMPLIANCE WITH THE GOVERNANCE CODE ............................. 124
APPENDIX 3. COMPANY'S MANAGEMENT REPORT ......................................................................................... 138
APPENDIX 4. REMUNERATION REPORT ......................................................................................................... 141
CONSOLIDATED ANNUAL REPORT FOR 2021 | 86
A WORD FROM THE PRESIDENT OF THE COMPANY
Dear All,
We are delighted to report that 2021 was a record-breaking year
for those investing with Invalda INVL group. Our investors earned
a total of EUR 210.5 million and Invalda INVL returned a total EUR
37.5 million.
Invalda INVL's core business is focused on asset management
and a wide range of investments. We are officially the leading
team of professionals for the Baltic region, investing in multiple
sectors and countries with a strong track record for 30 years. We
pride ourselves on the provision of capital and best-in-class
knowledge to both grow and develop while having a positive
impact on those around us.
Representing the interests of institutional and private clients who have entrusted their funds with us, we continue to operate
a variety of core activities including managing pension funds, other retail products, private equity activity and other alternative
investment funds. To better meet the needs of our clients and to achieve growth and synergies, Invalda INVL has also made
the decision to enter the life insurance market. To that end, we signed a deal to acquire life insurance business in the Baltics
from Mandatum Life and started the licensing process for INVL Life, which was completed in early 2022.
INVL's asset management business overall continues to grow successfully. We ended 2021 with a portfolio size of EUR 1.6
billion entrusted to us by over 260,000 customers (an increase of 29 and 5,5%, respectively). The revenues of the asset
management business reached EUR 15.8 million and Invalda INVL earned EUR 6.1 million from this business.
We are constantly identifying and originating new opportunities in the market and continually assessing the needs and wants
of our investor base. In 2021, we offered a series of new product lines and expanded the range of existing products managed
by INVL. We have already raised more than EUR 51 million in the INVL Sustainable Timberland and Farmland Fund II. A
significant percentage of these funds has already been successfully invested in both Lithuania and Latvia. We are delighted
with the projects that have already been realised. In 2021, we successfully closed the first forestry fund, providing investors
with an impressive average annual return (IRR) of 27%. INVL Renewable Energy Fund I commenced its operations during
the year 2021, raising EUR 34.6 million and investing in renewable energy projects located in the European Union, with a
current focus on the Polish market. We are also pleased with the results achieved by the majority of companies in the current
portfolio of our leading Baltics private equity fund, INVL Baltic Sea Growth Fund. This evaluation focuses on their overall
development as well as the quantitative and qualitative growth already achieved in 2021.
At the end of 2021, Invalda INVL's investment portfolio amounted to EUR 97 million, of which EUR 42.3 million was made
up of our investments in INVL products together with the Group's client base. As is often the case, the change in the value
of investments accounted for a significant part of Invalda INVL's profit margins in 2021. Due to the excellent annual results
achieved, the values of our investments in INVL Baltic Sea Growth Fund, Šiaulių bankas, MAIB, Litagra also increased
significantly. At the end of last year, we signed an agreement for the sale of Inservis' facilities management companies. We
expect to complete this transaction by mid-2022.
As we look further in 2022, we face a new common concern for the peace and long-term order that allows people to live,
work and create opportunities to prosper both safely and freely in Central and Eastern Europe. This is clearly of paramount
importance. While we fully support Ukraine, we are aware that it is very challenging to predict what the coming years will
bring and when the situation may stabilise. There are many questions that remain unanswered. How will the ongoing
situation affect individual countries and sectors of their economies, how will commodities prices and logistical challenges be
addressed and what GDP growth and inflation rates will result. The start of 2022 has been difficult for most markets. This
may well potentially negatively impact the value of some of our investments. However, we continue to monitor the changing
landscape on a daily basis, adapting and responding in real time. We do our job by managing the investments entrusted to
us and by making the key decisions that focus on both the protection of our clients' assets and new opportunities that always
arise.
On behalf of the Board of Invalda INVL, I would like to thank our clients and investors for their continued trust and
understanding that the economy is cyclical and good times are followed by more difficult periods, which are then followed by
growth constantly. I also thank our employees for their highly valued dedication and contribution to the Group's success. In
addition, thanks also to our shareholders for their confidence and support in the value creation of the business. Working
together we can grow, improve and achieve even more in the future.
Sincerely,
Darius Šulnis
CONSOLIDATED ANNUAL REPORT FOR 2021 | 87
I. GENERAL INFORMATION
1. Reporting period for which the report is prepared
The report is prepared for 12 months of 2021 (January – December). The report also includes significant events of the
company and the group that took place after the reporting period.
2. General information about the Issuer and other companies comprising the group
INFORMATION ABOUT THE ISSUER
Name of the Issuer
The public joint-stock company Invalda INVL
Code
121304349
Address
Gynėjų str. 14, LT-01109 Vilnius, Lithuania
Telephone
+370 5 279 0601
E-mail
info@invaldainvl.com
Website
www.invaldainvl.com
Legal form
The public joint-stock company
Date and place of registration
20 March 1992. Register of Enterprise of Vilnius
Register in which data about the Company are
accumulated and stored
Register of Legal Entities
INFORMATION ON COMPANY’S GOALS, PHILOSOPHY AND OPERATING PRINCIPLES
Who are we?
Invalda INVL is an asset management group that is open, growing and investing, and its activities create wellbeing for people.
Since the beginning of our activities, we have been working consistently and purposefully in the field of asset management
and investments, prioritising the interests of our clients. We maintain the same values as we grow. Furthermore, we are open
to new opportunities, new markets, new methods of operation. We believe that an open approach and careful consideration
of new ideas contributes significantly to the success and quality of our solutions. We grow by investing in the organic
development of the asset management business and, as opportunities arise, we make new acquisitions in this business.
Asset management and investing is our core business. We believe we create value to all stakeholders by, first and foremost,
doing our direct work well and performing our duties. We believe that the success of the business is inseparable from the
contribution to advancing the processes of the society thus we invest in knowledge, team coherence, promotion of social
activities, sustainability.
What do we seek?
The mission of Invalda INVL is to create well-being for people while contributing to the growth of the region we operate in.
We aim to be the first and best choice for our customers when it comes to long-term savings and personal finance
management. Therefore, we are working purposefully to complete the acquisition of Mandatum Life Insurance Company
Limited's life insurance business in the Baltics by the middle of 2022 and to be able to offer our customers more solutions
that ensure their financial security and well-being.
How do we operate?
Asset management and investing is our core business. The Group's companies operating in Lithuania and Latvia provide
services to more than 260 thousand individual and institutional regional and international clients entrusting the Invalda INVL
group to manage EUR 1.6 billion worth of assets. At the group level, we manage different asset classes such as pension
and investment funds, alternative investments (private equity, real assets and private debt), individual portfolios.
We also have our own investment portfolio. We invest in products managed by the group together with the clients of our
companies (general partner investments) in order to have better aligned common interests. The remainder of the current
portfolio consists of other historical investments.
On 15 June 2021, we entered into an agreement to acquire a life insurance business in the Baltic States and in 2022 we
hope to offer the Group's clients more opportunities to strengthen their financial security.
CONSOLIDATED ANNUAL REPORT FOR 2021 | 88
The list of group companies as well as their contact information is presented in Annex 1 to this Annual Report.
The financial data of the businesses that make up the group are presented in sections 5.1 and 5.2 of this report.
What is our experience?
Invalda INVL was founded in 1991 by a group of people from the academic community with the aim to create value and
contribute to the country’s economy. The company's shares have been traded on the Nasdaq Vilnius stock exchange since
1995. Since the start of the listing, the company has paid EUR 62.7 million to its shareholders (dividends and share
repurchases).
Over its history Invalda INVL has implemented a few dozen corporate acquisitions and sales, capital raising transactions
worth more than EUR 1.7 billion.
* Since the end of the first closing of INVL Baltic Sea Growth Fund on February 2019 Invalda INVL undertakes not to invest in
private equity assets that comply with the fund’s strategy and to conduct its main investment activity through this fund.
Invalda INVL’s experience in the private equity market
Key development steps of Invalda INVL group’s asset management business
CONSOLIDATED ANNUAL REPORT FOR 2021 | 89
II. FINANCIAL INFORMATION AND SIGNIFICANT EVENTS
3. Business environment
Taking into account the wide range of companies managed by Invalda INVL and investments in collective investment
undertakings, the Baltic stock markets and economies are reviewed in order to describe the operating environment as most
of our companies and investments in collective investment undertakings are concentrated there.
Baltic stock markets were strong and very active in 2021. Growth trend exhibited in 2020 continued in 2021 as well, together
with a significant recovery in consumption, corporate results, and macroeconomic data. Strong performance was evident all
year long and slowed only in the last quarter of 2021, amid fears of overheating economies. Among the Baltic States, Tallinn
Stock Exchange recorded an exceptional performance in 2021 and rose by 48.9%, whereas Vilnius Stock Exchange grew
by 18.3% and Riga Stock Exchange grew by 12.1%. Growth in the Baltics was in line with the trends in Western Europe,
where markets rose by 22.4% (according to the STOXX Europe 600 index) and global markets, that recorded growth of
17.2% (according MSCI ACWI index (in U.S. dollars)).
All stock indices (OMX Tallinn, OMX Riga, OMX Vilnius) are calculated separately on each Baltic stock exchange. They
include all companies listed on the Main and Secondary Lists of the Baltic stock exchanges except for those companies in
which one shareholder owns 90% or more of the issued shares. These indices reflect the current situation of the Baltic
securities market or the common Baltic securities market and its changes.
GROWTH OF THE BALTIC STOCK MARKETS
Index
31.12.2020
31.12.2021
+/- Change
OMX Tallinn
1,343.72
2,001.03
+48.92%
OMX Riga
1,136.34
1,274.2
+12.13%
OMX Vilnius
816.64
966.13
+18.31%
Source: Nasdaq Baltic
According to the data of Statistics Lithuania, in 2021, the average annual inflation in Lithuania amounted to 4.7 % (compared
to 2020, the average annual inflation was 1.2 %). In 2021, the prices of consumer goods in Lithuania increased by 11.7%,
while the prices for consumer services increased by 7.8 %. In 2021, the average annual inflation rate in the European Union
was 2.9 % and 2.6 % in the euro area. In Lithuania, the average annual inflation in 2021 was calculated according to the
consumer price index harmonised with the EU countries, which accounted for 4.6 %.
According to the Bank of Lithuania, in 2021, the global economy recovered, but slowed at the end of the year. The slowdown
in the global economy is mainly due to the high incidence of COVID-19 (which, even without severe restrictions, is worsening
household expectations) and the continuing tensions in supply chains. In addition, there are still no signs of normalisation
and tensions in supply chains, such as delivery times, remain relatively close to historic highs. At the same time, it should
be noted that, in contrast to the beginning of the pandemic, when long delivery times were associated with supply-side
restriction, they are now more associated with extremely high demand for goods.
According to the Ministry of Finance of the Republic of Lithuania, in 2021, businesses were able to adapt to the changed
conditions caused by the COVID-19 pandemic. As a result, changes in the value added generated by almost all economic
activities in 2021 were positive and the country’s economic growth was one of the fastest in the European Union. However,
the further development of a large number of enterprises is limited by staff shortages. Although labour force participation has
increased with the lifting of quarantine and the easing of contact restrictions, and the unemployment rate has approached
pre-pandemic levels, the level of job vacancies shows that the country's labour shortage is the highest since the beginning
of 2008. Increasing competition for workers was one of the key factors behind a nearly 10 % annual wage growth in the
country. Wage growth was recorded in all economic activities, including the accommodation and catering, leisure
organisation and retail trade activities, which suffered the most during the pandemic, where wages grew at double-digit rates.
The Ministry of Finance forecasts that in 2022, taking into account the situation in the labour market, rising salaries of public
sector employees and increasing minimum monthly wage, the growth rate of wages in Lithuania will reach 9.3 %. The growing
pressure to increase wages may contribute to the factors limiting the development of production, but according to the Bank
of Lithuania, rapidly rising wages have not yet reduced the competitiveness of Lithuanian business abroad, and wages still
lag behind the EU average more than productivity (-35 % and -29 % respectively).
CONSOLIDATED ANNUAL REPORT FOR 2021 | 90
4. Performance results of the issuer and the group
MAIN ITEMS OF FINANCIAL STATEMENTS
EUR thousand
COMPANY‘S
GROUP‘S
2019
2020
2021
2019
2020
2021
Non-current assets
86,381
83,737
120,933
83,410
80,665
115,961
Current assets
2,368
1,672
4,796
10,065
9,715
16,064
Equity
86,776
83,157
121,207
87,008
83,357
121,355
Non-current liabilities
1,523
1,458
2,978
3,640
3,783
5,678
Current liabilities
450
794
1,544
2,827
3,240
4,992
Result before taxes
21,477
5,209
38,879
21,661
5,329
39,595
Net result
20,827
5,329
37,453
20,841
5,373
37,479
Net result attributable to
holders of the parent
Company
-
-
20,827
5,329
37,453
CALCULATION OF THE NET ASSET VALUE OF INVALDA INVL
EUR thousand
Evaluation criteria
2019
2020
2021
Investment into asset management
Equity method
13,566
13,930
27,473
Investments into INVL Baltic Sea Growth
Fund (commitment to invest is excluded)
Fair value of net assets
3,577
7,492
15,597
Investments into INVL Baltic Real Estate
(including loans granted)
Market price
14,308
9,228*
4,402
Investments into Moldova-Agroindbank
Comparative method of multipliers
8,022
7,352
15,723
Investments into INVL Technology
Market price
3,130
3,808
5,134
Investment into investment fund through
subsidiary and directly
Fair value of net assets
5,415*
1,335
1,370
Investments into Litagra, UAB (including
loans granted)
Combination of discounted cash
flows and sales comparison
method (in 2019 comparative
method of multipliers)
17,256
18,085
20,318
Investments into Šiauliai Bank
Market price. (In 2021 the value of
the forward is included according
to its valuation model, based on
the market price)
16,672
16,409
26,400
Investments into Inservis, UAB
Transaction price. (2019
comparative method of multipliers;
2020 discounted cash flows)
4,511
5,775
7,244
Investments into other subsidiary
companies (including loans granted)
Fair value of net assets
633
422
30
Other assets, other investments
Book value
1,042
811
1,322
Cash and cash equivalents
Book value
617
762
716
Total assets
Book value
88,749
85,409
125,729
Liabilities
Book value
1,973
2,252
4,522
Net asset value
Book value
86,776
83,157
121,207
Net asset value per share
Book value
7.47
7.11
10.32
* The value of investments in non-consolidated companies is included
CONSOLIDATED ANNUAL REPORT FOR 2021 | 91
FINANCIAL RATIOS
Company’s
Group’s
2019
2020
2021
2019
2020
2021
Return on Equity (ROE), %
27.35
6.27
36.65
27.35
6.27
36.65
Debt ratio
0.02
0.03
0.04
0.07
0.08
0.08
Debt – Equity ratio
0.02
0.03
0.04
0.07
0.08
0.09
Liquidity ratio
5.26
2.11
3.11
3.56
3.00
3.22
Earnings per share (EPS), EUR
1.80
0.46
3.19
1.80
0.46
3.19
Price Earnings ratio (P/E)
3.78
16.62
5.32
3.78
16.62
5.32
The Company publishes Alternative performance measures (AVR) that are in use by the Company and the definitions of the
indicators. All information is disclosed on the Company‘s website https://www.invaldainvl.com/en/investor-relations/financial-
information-and-documents/formulas-of-performance-indicators/
Invalda INVL, AB is an asset management and investment company. The profit of the company is significantly impacted by
the recalculation of investments based on fair value as well as acquisition and sale deals, therefore, not all company
performance indicators are suitable for the evaluation of Invalda INVL, AB. Furthermore, investments into main asset
management business are recorded using the equity method, therefore, the book value may be different from the market
price. Accordingly, some ratios may not represent the real situation of the company.
5. Information on the group’s activities
5.1. ASSET MANAGEMENT BUSINESS
Invalda INVL manages licensed asset management companies INVL Asset Management in Lithuania and Latvia, financial
brokerage company INVL Finasta, land administration company INVL Farmland Management and 51 percent stake in
Mundus through INVL Asset Management.
The asset management business environment and the impact of COVID-19 on the asset management business
2021 was an extraordinary year for investment fund participants. With financial markets recovering strongly, investment
funds have earned exceptionally high returns despite the new waves of COVID-19. According to the Bank of Lithuania's
market Review of Collective Investment Undertakings, in 2021, equity investment funds stood out with a 32.7% growth, while
the performance of the mixed investment funds was slightly more moderate (5.6%), and the total weighted growth of the unit
values of all the CIUs reached 18.5%.
Looking at the 2021 performance, the investment fund market grew for the first time in the last 5 years. Two new CIUs were
launched in 2021 and assets under management grew by 10.29% (EUR 14.44 million). As at 31 December 2021, the largest
number of participants was invested in funds managed by INVL Asset Management UAB – 3,842 persons, or 83.23% of all
participants, i.e. 9.3% fewer participants than at the end of 2020.
In terms of the distribution of investment fund assets and participants by type, the largest group of investment funds by
assets under management was the real estate fund group, with assets under management representing 36.1% of the market
(EUR 55.84 million). Over 2021, the assets of real estate funds decreased by 6.76% or EUR 4.05 million. Equity investment
funds are the second largest group of funds in terms of assets under management and the first in terms of number of
participants. These funds managed 28.26% of the total assets of the CIU and had 82.54% of the total participants in the CIU
(an increase of EUR 22.34 million in assets and a decrease of 179 participants in 2021). Looking at the most popular fund
groups among small investors, the average investment per participant in equity funds was EUR 11.48 thousand, while the
average investment per participant in debt securities funds was EUR 45.44 thousand.
At the end of 2021, there were 40 II pillar pension funds. These funds were managed by 5 pension saving companies
According to the data of the Bank of Lithuania, the total value of net assets as at 31.12.2021 was almost EUR 5.91 billion
and 1.388 million participants were saving for their pensions in these funds. The assets of pension funds increased by
31.43% or EUR 1.4 billion over 2021. Contributions to pension funds amounted to EUR 502.28 million. The number of
participants in PFs also increased by 1.12%.
2021 were a record year for pension funds. The total weighted unit value change of II pillar pension funds was 21.0%, while
the weighted unit value change of the youngest four groups of PFs was over 25%.
ASSET
MANAGEMENT
ASSET
MANAGEMENT
FARMLAND
MANAGEMENT
FINASTA
CONSOLIDATED ANNUAL REPORT FOR 2021 | 92
III pillar pension funds are an additional voluntary pension provision. These pension funds accumulate funds transferred by
the pension fund participant on his/her own (or by his/her employer). In 2021, the performance of the III pillar pension funds
differed significantly among them. While the weighted average unit value change of the III pillar PFs was 13.82% and the
equity PFs had a record return (weighted average unit value change of 23.56%), the lowest risk-taking group of bond PFs
had a negative weighted average unit value change of -1.51%.
STRUCTURE OF THE ASSET MANAGEMENT BUSINESS
RESULTS OF THE ASSET MANAGEMENT
EUR million
(if not stated otherwise)
2020
2021
Lithuania
Latvia
Total
Lithuania
Latvia
Total
Number of clients, units
189.8
57.2
247.0
199.3
61.3
260.6
Amount earned for clients
52.5
210.5
Asset under management*
1,095.0
151.9
1,246.9
1,399.3
209,3
1,608.6
2nd pillar pension funds
597.3
150.3
747.6
781.1
207.5
995.6
3rd pillar pension funds
52.8
1.6
54.4
80.2
1.8
82.0
Investment funds
52.0
-
52.0
53.9
-
53.9
Portfolios
81.4
-
81.4
89.0
-
89.0
Alternative assets
311.5
-
311.5
388.1
-
388.1
Revenues
11.49
0.87
12.36
14.37
1,46
15.83
Profit (loss) before tax, EUR
thousand**
2,150
(270)
1,880
6,714
145
6,859
*eliminated investments into own products for which management fee is not charged
** according to accounting data of Invalda INVL
Number of employees in companies in the asset management sector
Number of employees
2019
2020
2021
-
130
132
158
CONSOLIDATED ANNUAL REPORT FOR 2021 | 93
5.2. OTHER MAJOR INVESTMENTS
AT THE END OF THE REPORTING PERIOD
Company
Activity
Directly owned
shares as of
31.12.2021, %
Value of the owned
shares 31.12.2021,
EUR million
Profit (loss) from
investment, EUR
million during 2021
GENERAL PARTNER INVESTMENTS
bsgf.invl.com
One of the largest private equity
investment funds in the Baltics.
The fund is intended for
professional investors.
12.22
15.60 + 12.26
commitment
7.58
www.invlbalticrealestate.com
Investment in a commercial real
estate company, acting as a
closed-end investment
company.
23.43
4.40
0.65
https://www.maib.md/
The largest commercial bank in
Moldova providing a full range
of financial services.
7.9
15.72
8.37
www.invltechnology.com
Investments in an information
technology company, acting as
a closed-end investment
company.
15.39
5.13
1.24
OTHER HISTORICAL INVESTMENTS
www.litagragroup.lt
Primary agricultural production
company that concentrates on
agriculture - the cultivation of
grain, milk and feed production.
48.81
20.30
2.20
www.sb.lt
Lithuanian commercial bank
providing financial services for
business and private clients.
5.43 +
forward
24.83 (value of
directly owned
shares)+1.57
(value of forward)
8.85 from owned
investment +1.57
from forward
(future acquisition
from EBRD)
www.inservis.lt
Facility management
companies group.
100
7.24
2.18
INVESTMENTS AT THE TIME OF ISSUE OF THIS REPORT
In January 2022, Invalda INVL transferred part of its investments to its 100% owned company INVL Life, which will start
providing life insurance services in the coming months.
CONSOLIDATED ANNUAL REPORT FOR 2021 | 94
Other major investments at the time of issuance of the report
6. Estimation of Issuer’s and Group’s activity last year and activity plans and forecasts
6.1. EVALUATION OF IMPLEMENTATION OF GOALS FOR 2021
Successful management of entrusted assets is a long-term priority of Invalda INVL group. In 2021, we intended to further
develop our asset management business and offer investors the opportunity to make additional investments in both existing
and new funds, as well as in the best international products of the third parties.
As planned, the INVL Renewable Energy Fund I was launched in 2021. The target size of the fund is EUR 60 million, the
maximum is EUR 100 million, and the target return is 11%. EUR 34.6 million was raised during the two distribution phases
and half of the target fund was exceeded. The fund will invest in green field and brown field renewable energy (solar, wind)
projects.
We have already raised more than EUR 51 million in the INVL Sustainable Timberland and Farmland Fund II. A significant
percentage of these funds has already been successfully invested in both Lithuania and Latvia. We are delighted with the
projects that have already been realised. In 2021, we successfully closed the first forestry fund, providing investors with an
impressive average annual return (IRR) of 27%.
We are also pleased with the results achieved by the majority of companies in the current portfolio of our leading Baltics
private equity fund, INVL Baltic Sea Growth Fund. This evaluation focuses on their overall development as well as the
quantitative and qualitative growth already achieved in 2021.
We believe that investing in the best third-party international products is interesting and beneficial for our customers, so INVL
Partner Global Infrastructure Fund I started operating as planned. This subfund will invest in a fund of infrastructure assets
established by a fund manager of global stature which has been in operation for 26 years. The strategy of investing in
infrastructure assets is based on very long-term investment and high-quality core infrastructure in member states of the
Organisation for Economic Co-operation and Development (OECD).
CONSOLIDATED ANNUAL REPORT FOR 2021 | 95
2021 was a record- year for investors with the Invalda INVL Group, with our clients earning EUR 210.5 million and Invalda
INVL earning EUR 37.5 million. INVL's asset management business continues to grow successfully. We ended 2021 with a
portfolio of EUR 1.6 billion entrusted to us by more than 260,000 customers. Due to the excellent annual results, the values
of our investments in INVL Baltic Sea Growth Fund, Šiaulių bankas, MAIB, Litagra increased significantly.
6.2. COVID-19 PANDEMIC IMPACT ASSESSMENT
The impact of the Covid-19 pandemic on Invalda INVL is not significant. The situation is still unclear and unresolved. We
monitor the situation, react to changes in the markets and try to make reasonable use of the opportunities that arise.
6.3. ACTIVITY PLANS AND FORECASTS
As we look further in 2022, we face a new common concern for the peace and long-term order that allows people to live,
work and create opportunities to prosper both safely and freely in Central and Eastern Europe. This is clearly of paramount
importance. While we fully support Ukraine, we are aware that it is very challenging to predict what the coming years will
bring and when the situation may stabilise. There are many questions that remain unanswered. How will the ongoing situation
affect individual countries and sectors of their economies, how will commodities prices and logistical challenges be
addressed and what GDP growth and inflation rates will result.
In 2022, it is planned to continue the purposeful development of the asset management business. To better meet the needs
of our clients and to achieve growth and synergies, we decided last year to enter the life insurance business and we signed
a deal in principle to acquire Mandatum Life's life insurance business in the Baltics. The acquisition of the insurance business
is expected to be completed in the coming months. We will then be able to offer our customers more solutions that ensure
their financial security and well-being.
The start of 2022 has been difficult for most markets. This may well potentially negatively impact the value of some of our
investments. We monitor ongoing processes and changes, we adjust and respond to them and continue to manage and
invest the assets and funds entrusted to us. We intend to continue to develop new products required by our customers and
to improve the assets we already manage. We will work consistently and purposefully. We are ready for change when it is
needed and meaningful, and we are open to new opportunities that are always there.
III. INFORMATION ABOUT SECURITIES
7. Information about Issuer’s authorised capital
7.1. ADJUSTMENTS OF THE AUTHORISED CAPITAL
Information concerning adjustments of Invalda INVL, AB authorised capital during past 10 years is presented below:
• 3 February 2010, the share capital of Invalda, AB was increased till EUR 14.96 million after conversion of EUR
14.48 million bonds.
• 30 March 2012 the share capital of Invalda, AB was increased by EUR 1.7 million till EUR 16.67 million after
conversion of EUR 2.15 million and EUR 7.24 million convertible bonds.
• On 6 August 2012 the share capital of Invalda, AB was decreased till EUR 15 million. The authorised capital of
Invalda, AB decreased due to cancelling of own shares acquired by the company.
• The amended Articles of Association of Invalda, AB were registered with the Register of Legal Entities on 31 May
2013. The Articles of Association were amended due to split-off of the company and stated a new name of the
company – public joint-stock company Invalda LT as well as a reduced authorized capital due to the split-off
procedure. The authorised capital of Invalda LT, AB was EUR 7.19 million.
• The amended Articles of Association of Invalda LT, AB were registered with the Register of Legal Entities on 29
April 2014. The Articles of Association were amended due to split-off of the company. After the completion of the
split-off of Invalda LT, the authorised capital was EUR 3.44 million and was divided into 11,865,993 ordinary
registered shares.
• The amended Articles of Association were registered with the Register of Legal Entities on 11 May 2015. According
to amended Articles of Association the name of the company was changed into Invalda INVL, AB. The authorised
capital was recounted into EUR and made EUR 3,441,137.97. It was divided into 11,865,993 ordinary registered
shares with nominal value EUR 0.29 each.
CONSOLIDATED ANNUAL REPORT FOR 2021 | 96
• On 23 May 2019 a new edition of the Articles of Association of Invalda INVL was registered in the Register of Legal
Entities. The Articles of Association were amended by increasing the authorized capital up to EUR 3,456,480.71 in
order to realize the stock options granted to the employees of Invalda INVL Group in 2016.
• On 8 June 2021, a new edition of the Articles of Association of Invalda INVL was registered in the Register of Legal
Entities. Invalda INVL increased its share capital to EUR 3,473,786.17 by issuing 59,674 new ordinary registered
shares. The newly issued shares were acquired by the employees of Invalda INVL Group exercising the stock
options granted to them in 2018.
7.2. STRUCTURE OF THE AUTHORIZED CAPITAL AS OF 31 DECEMBER 2021
Type of
shares
Number of
shares,
units
Total number
of votes
granted by all
issued
shares, units
Number of votes
calculating the
quorum of the
General Meeting of
Shareholders *
Nominal
value,
EUR
Total nominal
value, EUR
Portion of the
authorised
capital, %
Ordinary
registered
shares
11,978,573
11,978,573
11,749,032
0.29
3,473,786.17
100
* according to Article 27 (4) of the Law on Companies’ in determining the quorum of the General Meeting of Shareholders,
it is considered that the acquired own shares do not grant voting rights.
All shares are fully paid-up, and no restrictions apply on their transfer.
Invalda INVL group manages asset management company INVL Asset Management (through it – asset management
company Mundus) and financial brokerage company INVL Finasta. According to Lithuanian law, a natural or legal person
(or persons acting in concert), indirectly willing to acquire or increase their shareholding in an asset management company
(more than 20, 30 or 50 percent), have to obtain a decision from the Bank of Lithuania not to object this acquisition. This
means that investors, willing to acquire more than 20 percent shareholding in Invalda INVL, AB, can do so only with a prior
decision from the Bank of Lithuania.
In 2022, INVL Life, a company managed by Invalda INVL, received an insurance license. By law, a natural or legal person
or persons acting in concert who decide directly or indirectly acquire a sufficient shareholding or increase it to 20, 30 or 50
percent or more of the authorized capital of an insurance company, must obtain a decision from the supervisory authority
not to oppose the proposed acquisition.
Invalda INVL also owns asset management company INVL Asset Management in Latvia (through it – INVL atklatais pensiju
fonds“, managing 3
rd
pillar pension funds in Latvia), therefore according to Latvian Financial and Capital Market Commission
restrictions under acquisition of the shareholding in Invalda INVL might be fulfilled as well.
In addition, Invalda INVL group has indirectly invested in Moldova-Agroindbank, the largest commercial bank in Moldova,
therefore the relevant requirements of the Central Bank of Moldova may also apply to the acquisition of block of shares in
Invalda INVL.
7.3. INFORMATION ABOUT THE ISSUER’S TREASURY SHARES
Year of acquisition / loss of
own shares
Acquired (transferred)
amount, units
Price for one share, EUR
Comments
2015
143,645
3.82
2016
135,739
4.11
2017
23,076
4.55
2018
3,396
5.53
2019
2,552
5.67
2020
(78,867)
0.20
Own shares were
transferred to the
employees of the company
and the group by exercising
the share options granted in
2017
2021
-
-
total
229,541
CONSOLIDATED ANNUAL REPORT FOR 2021 | 97
During the reporting period, the company did not repurchase or transfer its own shares. At the end of the reporting period,
the number of treasury shares acquired by Invalda INVL amounted to 229,541. Pursuant to Article 27 (4) of the wording of
the Law on Companies, when determining the quorum of the general meeting of shareholders, it is considered that the
acquired own shares do not give votes at the shareholders' meeting.
7.4. INFORMATION ABOUT EMPLOYEES STOCK OPTIONS
Employees of Invalda INVL and companies where Invalda INVL owns more than 50% of shares may be offered to enter into
stock option agreements on the basis of which, within 3 (three) years they are granted the stock options. Employees shall
be entitled to acquire 0.29 EUR nominal value ordinary registered Invalda INVL shares at a price of EUR 1 (one) for each
share acquired. If shareholders adopts a decision on the payment of dividends, the reduction of authorized capital paying
out free funds to shareholders or other measures involving pay-outs to shareholders, then the General Meeting of
Shareholders must consider the matter of changing the number of Shares which Employees are allowed to acquire and/or
the price of the Shares in such a way as to maintain balance between the economic logic of the contract on entering into an
agreement to acquire Shares and the interests of the parties.
There is no employee share incentive scheme in Invalda INVL. The shares are granted in accordance with the Rules for
Granting Equity Incentives approved by the Company's General Meeting of Shareholders, which are published on the
company's website https://invaldainvl.com/files/EN/Draft%20Rules%20for%20Granting%20Equity%20Incentives.pdf.
Option contracts concluded and stock options exercised:
Allocation of options
Exercise of options
The year when stock
options contracts have
been signed
Number of shares, units
The year when
stock options are
exercised
The number of
shares (units)
acquired by
employees under
option contracts
Method of granting
shares
2016
52,906
2019
52,906
Newly issued
shares have been
subscribed
2017
80,571
2020
78,867
The company’s
own shares were
transferred
2018
59,674
2021
59,674
Newly issued
shares have been
subscribed
2019
70,397
2022
N/A
2020
317,227
2023
N/A
2021
65 287
2024
N/A
8. The order of amendment of Issuer’s Articles of Association
The Articles of Association of Invalda INVL, AB may be amended by resolution of the General Shareholders’ Meeting, if the
decision is passed by more than 2/3 of votes (except in cases provided for by the Law on Companies of the Republic of
Lithuania).
On 8 June 2021 a new edition of the Articles of Association of Invalda INVL was registered in the Register of Legal Entities.
This draft Articles of Association of the Company was approved by the shareholders at the Ordinary General Meeting of
Shareholders held on 30 April 2021. Actual wording of the Articles of Association is dated as of 8 June 2021. The document
is published on the company’s website
https://invaldainvl.com/files/docs/Articles%20of%20Association%20of%20Invalda%20INVL_since%2008_06_2021.pdf
CONSOLIDATED ANNUAL REPORT FOR 2021 | 98
9. Shareholders
9.1. INFORMATION ABOUT SHAREHOLDERS OF THE COMPANY
At the end of 2021 the total number of shareholders was 3,657. There are no shareholders entitled to special rights of control.
The shareholders of Invalda INVL: Alvydas Banys, UAB LJB Investments, Irena Ona Mišeikienė, Indrė Mišeikytė, Darius
Šulnis and UAB Lucrum Investicija, have signed a Contracts with the purpose of agreeing on the long-term management
policy of Invalda INVL. Therefore, their votes are counted together in accordance with Article 16, Section 1, Item 2 of the
Securities Law. Since the said contract does not contain provisions on the use of votes held directly by the parties in other
companies related to Invalda INVL, their votes are counted together only at the issuer level, i.e. only in Invalda INVL.
Considering the share of the company's authorized capital and / or votes held by the company's shareholders as of the date
of this report, as well as the purpose and provisions of the above-mentioned Invalda INVL Group long-term management
policy agreement, the company does not have a controlling shareholder, ie the parties to the said Agreement control the
company as part of a group, but not individually. Invalda INVL AB is not aware of any voting restrictions or agreements
between shareholders that may limit the transfer of securities and/or voting rights. During the twelve months of 2021, no
agreements were entered into to which the issuer is a party, and which would become effective, change or terminate upon
a change of control.
SHAREHOLDERS WHO HELD TITLE TO MORE THAN 5% OF INVALDA INVL AUTHORISED CAPITAL AND/OR VOTES
31 DECEMBER 2021
Name of the shareholder or
company
Number of
shares held by
the right of
ownership, units
Share of the
authorised capital
and votes held, %
Indirectly held
votes
1
, %
Total votes of the
shareholders
group*, %
LJB Investments. UAB
code 300822575,
Juozapavičiaus str. 9A, Vilnius
3,098,196
25.87
61.24
87.11
Alvydas Banys
2
910,875
7.60
79.51
Irena Ona Mišeikienė
3,006,834
25.10
62.01
Indrė Mišeikytė
236,867
1.98
85.13
Lucrum Investicija, UAB
code 300806471. Gynėjų str.
14, Vilnius
3,181,702
26.56
60.55
Darius Šulnis
3
0
0.00
87.11
Distributions of the share capital of the shareholders of Invalda INVL as of 31 December 2021
1
Invalda INVL shareholders Alvydas Banys, UAB LJB Investments, Irena Ona Mišeikienė, Indrė Mišeikytė, Darius Šulnis and UAB Lucrum Investicija
have signed an Agreement with the purpose of agreeing on the long-term management policy of Invalda INVL. Therefore, in accordance with Article
16, Section 1, Point 2 of the Securities Law, their votes are counted together. Given that the said agreement does not contain provisions on the use
of the parties' directly owned votes in other companies related to Invalda INVL, their votes are counted together only at the level of the issuer
2
It is considered that Alvydas Banys has the votes of the controlled company UAB LJB investments.
3
It is considered that Darius Šulnis has the votes of the controlled company UAB Lucrum Investicija.
25.87%
25.10%
26.56%
7.60%
1.98%
1.92%
10.97%
UAB LJB investments (a
company controlled by A.Banys)
Irena Ona Mišeikienė
UAB Lucrum Investicija (a
company controlled by D.Šulnis)
Alvydas Banys
Indrė Mišeikytė
Company's own shares
Other shareholders (> 3400)
CONSOLIDATED ANNUAL REPORT FOR 2021 | 99
Shareholders by type Shareholders by residence
9.2. RIGHTS AND OBLIGATIONS CARRIED BY THE SHARES
9.2.1. Rights of the shareholders
The Company’s shareholders have the following property and non-property rights:
1) to receive a part of the Company’s profit (dividend);
2) to receive the company’s funds when the authorised capital of the company is reduced with a view to paying out the
company’s funds to the shareholders;
3) to receive a part of assets of the company in liquidation;
4) to receive shares without payment if the authorised capital is increased out of the Company funds, except in cases
provided by the laws of the Republic of Lithuania;
5) to have the pre-emption right in acquiring shares or convertible debentures issued by the Company, except in cases
when the General Shareholders’ Meeting in the manner prescribed in the Law on Companies of the Republic of
Lithuania decides to withdraw the pre-emption right in acquiring the Company’s newly issued shares or convertible
debentures for all the shareholders;
6) to lend to the company in the manner prescribed by law; however, when borrowing from its shareholders, the company
may not pledge its assets to the shareholders. When the company borrows from a shareholder, the interest may not be
higher than the average interest rate offered by commercial banks of the locality where the lender has his place of
residence or business, which was in effect on the day of conclusion of the loan agreement. In such a case the company
and shareholders shall be prohibited from negotiating a higher interest rate;
7) other property rights provided by laws;
8) to attend the General Shareholders’ Meetings;
9) to submit to the Company in advance the questions connected with the issues on the agenda of the General Meeting
of Shareholders;
10) to vote at the General Shareholders’ Meetings according to voting rights carried by their shares;
11) to receive information on the Company specified in the Law on Companies of the Republic of Lithuania;
12) to appeal to the court for reparation of damage resulting from nonfeasance or malfeasance by the Company’s manager
and the Board members of their obligations prescribed by the Law on Companies of Republic of Lithuania and other
laws of the Republic of Lithuania and the Company’s Articles of Association as well as in other cases laid down by laws;
13) to receive information on a public company whose shares are admitted to trading on a regulated market as specified in
the Law on Companies of Financial Instruments Markets in the Republic of Lithuania;
14) other non-property rights established by laws and the Company’s Articles of Association.
9.2.2. Obligations of the shareholders
The shareholders have no property obligations to the Company, except for the obligation to pay up, in the established
manner, all the shares subscribed for at their issue price.
If the General Shareholders’ Meeting takes a decision to cover the losses of the Company from additional contributions
made by the shareholders, the shareholders who voted "for" shall be obligated to pay the contributions. The shareholders
who did not attend the General Shareholders’ Meeting or voted against such a resolution shall have the right to refrain from
paying additional contributions.
A person who has acquired all the shares of a company or has acquired a part of the shares of a public limited company
from the shareholder of this company shall notify the company no later than 5 days after the conclusion of the transaction.
The notice must include the number of shares acquired, including the number of shares by class, where the shares of the
different classes are acquired, their nominal value and the identity of the person transferring and acquiring the shares (name,
surname, personal identity number and place of residence or address of the natural person; name, legal form, code and
Legal entities Natural persons
Residents Non-residents
CONSOLIDATED ANNUAL REPORT FOR 2021 | 100
registered office and name, surname, personal code, place of residence or address of the legal representative). The notice
shall be accompanied by a document confirming the acquisition of the shares or an extract thereof. If a document is provided,
it must include the parties to the transaction, the subject of the transaction and the date of acquisition of the shares.
Contracts between the company and holder of all its share shall be executed in a simple written form unless the Civil Code
prescribes the mandatory notarised form.
A shareholder shall repay the Company any dividend paid out in violation of the mandatory norms of the Law on Companies,
if the Company proves that the shareholder knew or should have known thereof.
Each shareholder shall be entitled to authorise a natural or legal person to represent him when maintaining contacts with
the Company and other persons.
10. Dividends
The decision to pay dividends and the amount of dividends to be paid is determined by the company's general meeting of
shareholders
Information on the procedure for payment of dividends and payment of dividends during the entire period of operation of
Invalda INVL is provided on the company's website in the section dedicated to investors, in the section “Dividends and
share buy backs”.
RATIOS RELATED WITH SHARES
2019
2020
2021
Net Asset Value per share, EUR
7.47
7.11
10.32
Price to book value (P/Bv)
0.91
1.07
1.65
The Company publishes Alternative performance measures (AVR), that are in use of the Company, provides indicators
definitions. All the information is disclosed in the Company‘s web site section „Investor relations“ → „Reports“ → „Formulas
for performance indicators.
https://www.invaldainvl.com/en/investor-relations/financial-information-and-documents/formulas-of-performance-indicators/
11. Trading in Issuer’s securities as well as securities of the group companies’
11.1. TRADING IN ISSUER’S SECURITIES
MAIN CHARACTERISTICS OF INVALDA INVL, AB SHARES ADMITTED TO TRADING
Shares issued, units
11,978,573
Nominal value
0.29 EUR
Total nominal value
3,473,786.17 EUR
ISIN code
LT0000102279
The Issuer Agent
AB Šiaulių bankas
Exchange
Nasdaq Vilnius
Ticker
IVL1L
List
Baltic Secondary list
Baltic Main List (from 1 January 2008 until 20 July 2015)
Listing date
19 December 1995
LEI code
52990001IQUJ710GHH43
From 3 August 2020, Šiaulių bankas AB provides the company with a market making service.
CONSOLIDATED ANNUAL REPORT FOR 2021 | 101
TRADING IN INVALDA INVL, AB SHARES
2019
2020
2021
Share price, EUR
- open
4.74
6.80
7.60
- high
6.85
8.95
18.70
- low
4.70
5.65
7.60
- last
6.80
7.60
17.00
Turnover, units
41,794
89,010
63,625
Turnover, EUR
244,594
619,336
681,010
Traded volume, units
303
1,212
1,561
Capitalisation, EUR mln.
78.95
88.84
199.73
TRADING IN THE COMPANY’S SHARES DURING THE PERIOD OF 2019–2021 (QUARTERLY) ON NASDAQ VILNIUS
STOCK EXCHANGE:
Reporting period
Price, €
Last trading date
Total turnover
high
low
last
units
€
2019, 1
st
Q
5.40
4.70
5.30
29.03.2019
6,629
34,017
2019, 2
nd
Q
5.80
5.30
5.50
29.06.2019
11,457
63,836
2019, 3
rd
Q
6.15
5.50
6.10
30.09.2019
9,555
55,966
2019, 4
th
Q
6.85
5.95
6.80
30.12.2019
14,153
90,776
2020, 1
st
Q
7.20
5.65
5.90
31.03.2020
21,925
146,005
2020, 2
nd
Q
8.95
5.90
7.00
30.06.2020
31,449
219,194
2020, 3
rd
Q
7.25
6.90
7.25
30.09.2020
18,314
129,657
2020, 4
th
Q
8.40
7.00
7.60
30.12.2020
17,322
124,480
2021, 1
st
Q
9.60
7.60
8.85
31.03.2021
14,606
125,707
2021, 2
nd
Q
9.80
8.55
9.30
30.06.2021
12,545
114,832
2021, 3
rd
Q
11.80
9.20
11.20
30.09.2021
20,764
205,677
2021, 4
th
Q
18.70
11.20
17.00
30.12.2021
15,710
234,795
CAPITALISATION
Last trading date
Number of shares (company’s own
shares excluded), units
Last price, €
Capitalisation, €
29.03.2019
11,560,137
5.30
61,268,726
29.06.2019
11,610,491
5.50
63,857,701
30.09.2019
11,610,491
6.10
70,823,995
30.12.2019
11,610,491
6.80
78,951,339
31.03.2020
11,610,491
5.90
68,501,897
30.06.2020
11,689,358
7.00
81,825,506
30.09.2020
11,689,358
7.25
84,747,846
30.12.2020
11,689,358
7.60
88,839,121
31.03.2021
11,689,358
8.85
103,450,818
30.06.2021
11,749,032
9.30
109,265,998
30.09.2021
11,749,032
11.20
131,589,158
30.12.2021
11,749,032
17.00
199,733,544
CONSOLIDATED ANNUAL REPORT FOR 2021 | 102
Turnover of Invalda INVL. AB shares and share price during the past 3 years
Changes in Invalda INVL share price and OMX Vilnius index over 10 years, %
Index/Shares
01.01.2011
01.01.2021
30.12.2021
Change (%) since
2011
Change (%) in
12 months of
2021
OMX Vilnius
409.65
816.64
966.13
135.84
18.31
Invalda INVL
1.989 EUR
7.60 EUR
17.00 EUR
754.70
123.68
0
10000
20000
30000
40000
50000
60000
70000
0
2
4
6
8
10
12
14
16
18
20
02.01.2019
23.02.2019
16.04.2019
07.06.2019
29.07.2019
19.09.2019
10.11.2019
01.01.2020
22.02.2020
14.04.2020
05.06.2020
27.07.2020
17.09.2020
08.11.2020
30.12.2020
20.02.2021
13.04.2021
04.06.2021
26.07.2021
16.09.2021
07.11.2021
29.12.2021
Turnover, EUR Share price, EUR
-50
50
150
250
350
450
550
650
750
850
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
CONSOLIDATED ANNUAL REPORT FOR 2021 | 103
11.2. TRADING IN SECURITIES OF THE GROUP COMPANIES’
Shares of subsidiary companies of Invalda INVL, forming the group, are not traded on stock exchanges. INVL Baltic Real
Estate, INVL Technology and Šiaulių Bankas, companies Invalda INVL directly or indirectly invested in, are listed on Nasdaq
Vilnius stock exchange.
IV. ISSUER’S MANAGING BODIES
12. Structure, authorities, the procedure for appointment and replacement
The governing bodies of Invalda INVL, AB are the General Shareholders’ Meeting, sole governing body – the President and
a collegial governing body – the Board. The Supervisory Board is not formed.
12.1. GENERAL SHAREHOLDERS’ MEETING
Powers of the General Shareholders’ Meeting
Persons who were shareholders of the Company at the close of the accounting day of the meeting (the 5th working day
before the General Shareholders’ Meeting) shall have the right to attend and vote at the General Shareholders’ Meeting in
person unless otherwise provided for by laws or may authorise other persons to vote for them as proxies or may conclude
-40
-20
0
20
40
60
80
100
120
02.01.2019
07.03.2019
10.05.2019
13.07.2019
15.09.2019
18.11.2019
21.01.2020
25.03.2020
28.05.2020
31.07.2020
03.10.2020
06.12.2020
08.02.2021
13.04.2021
16.06.2021
19.08.2021
22.10.2021
25.12.2021
INVL Technology INVL Baltic Real Estate Šiaulių bankas
General Shareholders‘ Meeting
The Board (3 members)
The President
CONSOLIDATED ANNUAL REPORT FOR 2021 | 104
an agreement on the disposal of the voting right with third parties. The shareholder’s right to attend the General Shareholders’
Meeting shall also cover the right to speak and enquire.
The General Shareholders’ Meeting may take decisions and shall be held valid if attended by the shareholders who hold the
shares carrying not less than ½ of all votes. After the presence of a quorum has been established, the quorum shall be
deemed to be present throughout the General Shareholders’ Meeting. If a quorum is not present, the General Shareholders’
Meeting shall be considered invalid and a repeat General Shareholders’ Meeting must be convened, which shall be
authorised to take decisions only on the issues on the agenda of the General Shareholders’ Meeting that has not been held
and to which the quorum requirement shall not apply.
An Annual General Shareholders’ Meeting must be held every year at least within 4 months from the close of the financial
year.
The General Shareholders’ Meeting shall have the exclusive right to:
• amend the Articles of Association of the Company. unless otherwise provided for by the Law on Companies of the
Republic of Lithuania;
• change registered office of the company;
• elect members of the Board;
• dismiss the Board or its members;
• elect and dismiss the firm of auditors. set the conditions for auditor remuneration;
• determine the class, number, nominal value and the minimum issue price of the shares issued by the Company;
• take a decision regarding conversion of shares of one class into shares of another class. approve share conversion
procedure;
• take a decision to replace private limited liability company share certificates by shares;
• approve the annual accounts and the report on company operations;
• take a decision on profit/loss appropriation;
• take a decision on the formation, use, reduction and liquidation of reserves;
• to approve the set of interim financial statements for the purpose of making a decision on the allocation of dividends
for a period shorter than the financial year;
• decide on the allocation of dividends for a period shorter than the financial year;
• take a decision on the issue of convertible debentures;
• take a decision on withdrawal for all the shareholders the pre-emption right to acquire the Company’s shares or
convertible debentures of the specific issue;
• take a decision to increase the authorised capital;
• take a decision to reduce the authorised capital. except the cases provided for by the Law on Companies of the
Republic of Lithuania;
• take a decision for the Company to purchase its own shares;
• take a decision to approve rules on giving stock options to employees and /or members of the bodies;
• take a decision on the reorganisation or split-off of the Company and approve the terms of reorganisation or split-
off, except the cases provided for in the Law on Companies of the Republic of Lithuania;
• take a decision on transformation of the Company;
• take decisions on company restructuring in the cases provided for in the Law on Restructuring of Enterprises;
• take a decision to liquidate the Company, cancel the liquidation of the Company, except the cases provided by the
Law on Companies of the Republic of Lithuania;
• elect and dismiss the liquidator of the Company, except the cases provided by the Law on Companies of the
Republic of Lithuania.
The General Shareholders’ Meeting may also decide on other matters assigned within the scope of its powers by the Articles
of Association of the Company, unless these have been assigned under the Law on Companies of the Republic of Lithuania
within the scope of powers of other organs of the Company and provided that. in their essence, these are not the functions
of the governing bodies.
Convocation of the General Shareholders’ Meeting of Invalda INVL, AB
The documents related to the agenda, draft resolutions on every item of agenda, documents what have to be submitted to
the General Shareholders Meeting and other information related to realization of shareholders rights are available at the
registered office of the Company during working hours or on company’s website www.invaldainvl.com.
CONSOLIDATED ANNUAL REPORT FOR 2021 | 105
The shareholders are entitled: (i) to propose to supplement the agenda of the General Shareholders Meeting submitting draft
resolution on every additional item of agenda or, when there is no need to make a decision - explanation of the shareholder
(this right is granted to shareholders who hold shares carrying at least 1/20 of all the votes). Proposal to supplement the
agenda is submitted in writing sending the proposal by registered mail to the Company at Gyneju str. 14, Vilnius, Lithuania,
or delivered in person to the representative of the Company or by sending proposal to the Company by email
info@invaldainvl.com. The agenda is supplemented if the proposal is received no later than 14 before the General
Shareholders Meeting; (ii) to propose draft resolutions on the issues already included or to be included in the agenda of the
General Shareholders Meeting at any time prior to the date of the General Shareholders meeting (in writing sending the
proposal by registered mail to the Company at Gyneju str. 14, Vilnius, Lithuania, or delivered in person to the representative
of the Company or by sending proposal to the Company by email info@invaldainvl.com) or in writing during the General
Shareholders Meeting (this right is granted to shareholders who hold shares carrying at least 1/20 of all the votes); (iii) to
submit questions to the Company related to the issues of agenda of the General Shareholders Meeting in advance but no
later than 3 business days prior to the General Shareholders Meeting in writing sending the proposal by registered mail to
the Company at Gyneju str. 14, Vilnius, Lithuania, or delivered in person to the representative of the Company or by sending
proposal to the Company by email info@invaldainvl.com. The company reserves the right to answer to those shareholders
of the Company who can be identified and whose questions are not related to the company's confidential information or
commercial secrets.
Shareholder participating at the General Shareholders Meeting and having the right to vote must submit documents
confirming personal identity. Each shareholder may authorize either a natural or a legal person to participate and to vote on
the shareholder's behalf at the General Shareholders Meeting. A power of attorney issued by a natural person must be
certified by a notary. The representative has the same rights as his represented shareholder at the General Shareholders
Meeting. The authorized persons must have documents confirming their personal identity and power of attorney approved
in the manner specified by law which must be submitted to the Company no later than before the commencement of
registration for the General Shareholders Meeting. A power of attorney issued in a foreign state must be translated into
Lithuanian and legalised in the manner established by law. The Company does not establish special form of power of
attorney.
Shareholder is entitled to issue power of attorney by means of electronic communications for legal or natural persons to
participate and to vote on its behalf at the General Shareholders Meeting. No notarisation of such authorization is required.
The power of attorney issued through electronic communication means must be confirmed by the shareholder with a safe
electronic signature developed by safe signature equipment and approved by a qualified certificate effective in the Republic
of Lithuania. The shareholder shall inform the Company on the power of attorney issued through the means of electronic
communication by e-mail info@invaldainvl.com not later than on the last business day before the General Shareholders
Meeting. The power of attorney and notification must be issued in writing and could be sent to the Company by
communication means if the transmitted information is secured and the shareholder's identity can be identified.
The Company is not providing the possibility to attend and vote at the General Shareholders Meeting through electronic
means of communication.
Shareholder or its representative may vote in writing by filling general voting bulletin, in such a case the requirement to
deliver a personal identity document does not apply. The form of general voting bulletin is presented at the Company's
webpage www.invaldainvl.com section For Investors.
If shareholder requests, the Company shall send the general voting bulletin to the requesting shareholder by registered mail
or shall deliver it in person against signature no later than 10 days prior to the General Shareholders Meeting free of charge.
The filled general voting bulletin must be signed by the shareholder or its authorized representative. Document confirming
the right to vote must be added to the general voting bulletin if authorized person is voting. The filled general voting bulletin
must be sent by the registered mail to the Company at Gyneju str. 14, Vilnius, Lithuania, or delivered in person to the
representative of the Company no later than the day before of the General Shareholders Meeting.
In 2021 1 (one) shareholders' meeting of Invalda INVL was held. The ordinary general meeting of shareholders of Invalda
INVL AB took place on 30 April 2021. The decisions of this shareholders meeting can be found here
https://www.invaldainvl.com/en/investor-relations/shareholders-meetings/
12.2. THE BOARD
Powers of the Board
The Board shall continue in office for the 4-year period or until a new Board is elected and commences its activities, but not
longer than until the date of the Annual General Shareholders’ Meeting to be held during the final year of the term of office
CONSOLIDATED ANNUAL REPORT FOR 2021 | 106
of the Board. If individual members of the Board are elected. they shall serve only until the expiry of the term of office of the
current Board.
The Board or its members shall commence their activities after the close of the General Shareholders’ Meeting which elected
the Board or its members. Where the Articles of Association of the Company are amended due to the increase in the number
of its members, newly elected members of the Board may commence their activities solely from the date of registration of
the amended Articles of Association. The Board shall elect the chairman of the Board from among its members.
The General Shareholders’ Meeting may dismiss from the office the entire Board or its individual members (as well as the
Chairman of the Board) before the expiry of their term of office. A member of the Board may resign from his post before the
expiry of his term of office, notifying the Board in writing at least 14 calendar days in advance.
The Board shall have all authorities provided for in the Articles of Association of the Company as well as those assigned to
the Board by the laws. The activities of the Board shall be based on collegial consideration of issues and decision-making
as well as shared responsibility to the General Shareholders’ Meeting for the consequences of the decisions made. Striving
for as big benefit for the Company and shareholders as possible and in order to ensure the integrity and transparency of the
control system, the Board closely cooperates with the manager of the Company. The working procedure of the Board shall
be laid down in the rules of procedure of the Board adopted by it.
The Board discusses and approves the issues set forth in the Law on Companies of the Republic of Lithuania.
The Board shall analyse and assess a set of Company's and consolidated annual financial statements and draft of profit/loss
appropriation and submit them to the General Shareholders’ Meeting together with the annual management report.
The Board shall consider and approve the company's business strategy, analyse and evaluate information about the
company's business strategy, the following information is provided to the Annual General Meeting.
It shall be the duty of the Board to convene and organise the General Shareholders’ Meetings in due time.
Members of the Board must keep commercial secrets of the Company and confidential information which they obtained while
holding the office of members of the Board.
Procedure of work of the Board
The order of the formation of the Board of the company should ensure objective. impartial and fair representation of minority
shareholders of the company: names and surnames of the candidates to become members of the Board of the company.
information about their education. qualification. professional background. positions taken in supervisory and management
Boards of other companies. owned block of shares in other companies. larger than 1/20. potential conflicts of interest.
information on whether the candidates are applied to administrative sanctions or punishment for violations / crimes against
the economy. business policy. property. property rights and property interests. or do they have no obligations neither
functions which would threaten the safe and reliable operations of the company. or whether candidates meet the legal
requirements made for the Managers. are disclosed not later than 10 days prior the General Shareholders’ Meeting in which
the election of the Members of the Board is intended. so that the shareholders would have sufficient time to make an informed
voting decision.
In order to maintain a proper balance in terms of the current qualifications possessed by its members, the desired
composition of the Board of the company are determined with regard to the company’s structure and activities and are
periodically evaluated once a year.
Any Member of the Board of the company must confound company’s property with its own property and do not use it or
information which they received while holding position as the Members of the Board for personal benefit or for the benefit of
third party on other way than the General Shareholders Meeting and the Board allows it.
Each Member of the Board actively participates in the Meetings of Board and devotes sufficient time and attention to perform
his duties as the Member of the Board. Regulation of the work of the Board of the company settles the statements that if the
Member of the Board attended the Meetings of the Board less than 2/3 times in the financial year, such information must be
disclosed to shareholders in the General Shareholders‘ Meeting.
Alvydas Banys, Indrė Mišeikytė and Darius Šulnis were elected to the Board of Invalda INVL on 30 April 2018. The members
of the Board elected by the General Meeting of Shareholders act separately and for the benefit of the Company and its
shareholders, but do not meet the requirements of independence. The Supervisory Authority of the Bank of Lithuania
recommends to disclose that the composition of the Board of the Company without independent members cannot ensure
proper implementation of the provisions of the Law on Companies of the Republic of Lithuania in relation to related parties
transactions. The Company makes every effort to ensure the proper implementation of the aforementioned provisions
regarding related party transactions and publishes such information on the Company's website and in its annual reports,
distributes information and recommendations to its related companies, and frequently consults with the Company's Audit
Committee. The independence provisions of the board members will apply to the election of a new board within the company.
The current Board of Invalda INVL will perform its functions until the end of the term for which it was elected, i.e. until the
ordinary shareholders meeting to be held in 2022.
CONSOLIDATED ANNUAL REPORT FOR 2021 | 107
12.3. THE PRESIDENT
The manager of the Company (the President) shall be elected and dismissed from office by the Board which shall also fix
his salary, approve his job description, provide incentives and impose penalties. An employment contract shall be concluded
with the President. The President shall assume office after the election, unless otherwise provided for in the contract
concluded with him. If the Board adopts a decision on his removal from office, the employment contract therewith shall be
terminated.
In his activities, the President shall be guided by laws and other legal acts, the Articles of Association of the Company,
decisions of the General Shareholders’ Meeting and the Board, his job description. The President is accountable to the
Board.
The President shall organise daily activities of the Company, hire and dismiss employees, conclude and terminate
employment contracts therewith, provide incentives and impose penalties.
The President shall act on behalf of the Company and shall be entitled to enter into transactions at his own discretion. The
President may conclude the transactions to invest, dispose of or lease the fixed assets for the book value which exceeds
1/20 of the authorised capital of the Company (calculated individually for every type of transaction), to pledge or mortgage
the fixed assets for the book value which exceeds 1/20 of the authorised capital of the Company (calculated for the total
amount of transactions), to offer surety or guarantee for the discharge of obligations of third parties for the amount which
exceeds 1/20 of the authorised capital of the Company, to acquire the fixed assets for the price which exceeds 1/20 of the
authorised capital of the Company, provided there is a decision of the Board to enter into these transactions.
The President shall be responsible for:
• the organisation of activities and the implementation of objects of the company;
• the drawing up of the annual financial statements and annual management report;
• drafting a decision on the issuance of dividends for a period shorter than the financial year, drawing up an interim
financial report and preparing an interim report for the adoption of a decision on the allocation of dividends for a
period shorter than the financial year. The interim report shall apply mutatis mutandis the provisions of the Law on
Company Financial Accountability for the preparation and publication of the annual management report.
• Drafting rules on giving stock options;
• the conclusion of the contract with the firm of auditors where the audit is mandatory or required under the Statutes
of the company;
• the submission of information and documents to the General Meeting. the Supervisory Board and the Board in
cases laid down in this Law or at their request;
• the submission of documents and particulars of the company to the administrator of the Register of Legal Persons;
• the submission of the documents of a public limited liability company to the Bank of Lithuania and the Central
Securities Depository;
• the publication of information referred to in this Law in the daily indicated in the Statutes;
• reporting to the shareholders and the board about the most important events that are relevant to the company's
activities;
• the submission of information to shareholders;
• the fulfilment of other duties laid down in this Law and other laws and legal acts as well as in the Statutes and
the staff regulations of the manager of the company.
The President must keep commercial secrets and confidential information of the Company which he learned while holding
this office.
13. Information about members of the Board, CFO and the Audit Committee of the
Company
The Board of Invalda INVL, AB was re-elected during the Extraordinary General Shareholders’ Meeting on 30 April 2018.
Mr. Banys was elected as the Chairman of the Board. Mr. Šulnis and Ms. Mišeikytė were elected as the Members of the
Board. Mr. Šulnis was appointed as the President of the company on 22 May 2013.
CONSOLIDATED ANNUAL REPORT FOR 2021 | 108
Term of
office
Educational
background and
qualifications
Owned number of
shares in Invalda
INVL
Participation in the management of
other companies
Alvydas Banys
Chairman of the Board
Since 2018
until 2022
Vilnius
Gediminas
Technical
University.
Faculty of Civil
Engineering.
Master in
Engineering and
Economics.
Junior Scientific
co-worker.
Economics’
Institute of
Lithuania‘s
Science
Academy.
Personally: 910,875
units of shares, 7.60
% of authorised
capital and votes;
Together with
controlled company
LJB Investments:
4,009,071 units of
shares. 33.47 % of
authorized capital
and votes.
Total votes with
others whose votes
are counted
together - 87.11%.
Invalda INVL, AB (code 121304349,
Gynėjų g. 14, Vilnius, Lithuania) –
Senior Adviser (main place of work)
INVL Baltic Sea Growth Fund,
managed by INVL Asset
Management (code 126263073,
Gynėjų g. 14, Vilnius, Lithuania) -
Investment Committee member
INVL Baltic Farmland, AB (code
303299781, Gynėjų g. 14, Vilnius,
Lithuania) – Chairman of the Board
Litagra, UAB (code 304564478,
Savanorių pr. 173, Vilnius,
Lithuania) – Member of the Board
LJB investments, UAB (code
300822575, A. Juozapavičiaus g.
9A, Vilnius.) and LJB property, UAB
(code 300822529; A.
Juozapavičiaus g. 9A, Vilnius.) CEO
Indrė Mišeikytė
Member of the Board
Since 2018
until 2022
Vilnius Gedimino
Technical
University.
Faculty of
Architecture.
Master in
Architecture.
Personally: 236,867
units of shares,
1.98% of authorised
capital and votes.
Total votes with
others whose votes
are counted
together - 87.11%.
Invalda INVL, AB (code 121304349,
Gynėjų g. 14, Vilnius, Lithuania) –
Adviser (main place of work)
INVL Baltic Farmland, AB (code
303299781, Gynėjų g. 14, Vilnius,
Lithuania) – Member of the Board
INVL Technology, SUTPKIB (code
300893533, Gynėjų g. 14, Vilnius,
Lithuania) – Member of the
Supervisory Board
Darius Šulnis –
Member of the Board, the
President of Invalda INVL
Since 2018
until 2022
Duke University
(USA). Business
Administration.
Global
Executive MBA.
Vilnius
University.
Faculty of
Economics.
Master in
Accounting and
Audit.
Financial
broker‘s license
(general) No.
A109.
Personally: 0 units
of shares, 0% of
authorised capital
and votes.
Together with
controlled company
Lucrum Investicija:
3,181,702 units of
shares, 26.56% of
authorised capital
and votes.
Total votes with
others whose votes
are counted
together - 87.11%.
Invalda INVL, AB (code 121304349,
Gynėjų g. 14, Vilnius, Lithuania) –
the President (main place of work)
INVL Baltic Sea Growth Fund,
managed by INVL Asset
Management (code 126263073,
Gynėjų g. 14, Vilnius, Lithuania) -
Investment Committee Member
INVL Asset Management, UAB
(code 126263073, Gynėjų g. 14,
Vilnius, Lithuania) – Chairman of the
Board
Šiaulių Bankas AB (code
112025254, Tilžės g. 149, Šiauliai,
Lithuania) – Member of the
Supervisory Board
INVL Baltic Farmland, AB (code
303299781, Gynėjų g. 14, Vilnius,
Lithuania) – Member of the Board
Litagra, UAB (code 304564478,
Savanorių pr. 173, Vilnius, Lithuania)
– Member of the Board
CONSOLIDATED ANNUAL REPORT FOR 2021 | 109
Term of office
Educational
background and
qualifications
Owned number of
shares in Invalda
INVL
Work experience
Raimondas Rajeckas
CFO
-
Vilnius University,
Faculty of
Economics, Master
of Science in
Accounting and
Auditing
Personally: 26,959
units of shares,
0.23% of authorised
capital and votes.
The right to acquire
129,145 shares of
the company
according to the
concluded share
option agreements.
Since 2006 CFO at
Invalda INVL
2001 – 2006 CFO at
Valmeda, AB
2000 – 2001 CFO at
Galincius, AB
2000 – 2001 CFO at
Invaldos Marketingas,
UAB (current name Inreal
Valdymas. UAB)
2000 – 2002 Accountant
at Gildeta, AB
1998 – 2000 Accountant at
Invalda, AB
14. Information about the Audit Committee of the company
The Audit Committee consists of 2 independent members. The members of the Audit Committee are elected and dismissed
by the General Shareholders’ Meeting of Invalda INVL, AB for a term not exceeding 4 years. The main functions of the Audit
Committee should be the following:
• provide recommendations to the Board of the company with selection. appointment. reappointment and removal of
an external audit company as well as the terms and conditions of engagement with the audit company;
• monitor the process of external audit;
• monitor how the external auditor and audit company follow the principles of independence and objectivity;
• observe the process of preparation of financial reports of the company;
• monitor the efficiency of the internal control and risk management systems of the company. Once a year review the
need of the internal audit function.
• monitor the implementation of the audit firm's recommendations and comments imposed by the Board and the
manager of the company.
The Member of the Audit Committee of the company may resign from his post before the expiry of term of office notifying
the Board of the company in writing at least 14 calendar days in advance. When the Board of the Company receives the
notice of resignation and estimates all circumstances related to it. the Board may pass the decision either to convene the
Extraordinary General Shareholders Meeting to elect the new member of the Audit Committee or to postpone the question
upon the election of the new member of the Audit Committee until the nearest General Shareholders Meeting. In any case
the new member is elected till the end of term of office of the operating Audit Committee.
Procedure of work of the audit committee
The Audit Committee is a collegial body taking decisions during meetings. The Audit Committee may take decisions and its
meeting should be considered valid when both members of the Committee participate in it. The decision should be passed
when both members of the Audit Committee vote for it. The Member of the Audit Committee may express his will – for or
against the decision in question the draft of which he is familiar with – by voting in advance in writing. Voting in writing should
be considered equal to voting by telecommunication end devices, provided text protection is ensured and it is possible to
identify the signature. The right of initiative of convoking the meetings of the Audit Committee is held by both Members of
the Audit Committee. The other Member of the Audit Committee should be informed about the convoked meeting, questions
that will be discussed there and the suggested drafts of decisions not later than 3 (three) business days in advance in writing
CONSOLIDATED ANNUAL REPORT FOR 2021 | 110
(by e-mail or fax). The meetings of the Audit Committee should not be recorded and the taken decisions should be signed
by both Members of the committee. When both Audit Committee Members vote in writing, the decision should be written
down and signed by the secretary of the Audit Committee who should be appointed by the Board of the Company. The
decision should be written down and signed within 7 (seven) days from the day of the meeting of the Audit Committee.
The Audit Committee should have the right to invite the Manager of the Company, Member(s) of the Board, the chief financier
and employees responsible for finance, accounting and treasury issues as well as external auditors to its meetings. Members
of the Audit Committee may receive remuneration for their work in the committee at the maximum hourly rate approved by
the General Shareholders’ Meeting
On 28 April 2017 the General Shareholders meeting elected independent Audit Committee members: Dangutė
Pranckėnienė, partner and auditor of Moore Stephens Vilnius, UAB and Tomas Bubinas, a Chief Operating Officer at
Biotechpharma, UAB.
Term of office
Educational
background and
qualifications
Owned number of
shares in Invalda
INVL
Work experience
Dangutė Pranckėnienė
Independent audit
committee member
Since 2021 until
2025
Vilnius Gediminas
Technical
University, Master
of Business
Administration.
Vilnius University,
Master of
Economics.
The International
Coach Union (ICU),
professional
coucher name.
Lithuanian Ministry
of Finance, the
auditor's name.
-
Since 1997 the Partner at
Moore Mackonis, UAB
1996 - 1997 Audit
Manager, Deloitte &
Touche
1995 - 1996 Lecturer,
Vilnius Gediminas
Technical University
1982 - 1983 Lecturer,
Vilnius University
Tomas Bubinas
Independent audit
committee member
Since 2021 until
2025
Baltic Management
Institute (BMI),
Executive MBA
Association of
Chartered Certified
Accountants.
ACCA. Fellow
Member
Lithuanian Sworn
Registered Auditor
Vilnius University,
Msc. in Economics
-
Since 2013 Chief
Operating Officer of
Biotechpharma, UAB.
2010 – 2012 Senior
Director of TEVA
Biopharmaceuticals
(USA).
2004-2010 – TEVA
Pharmaceuticals, Chief
Financial Officer for the
Baltic States.
2001-2004 – Sicor
Biotech, Chief Financial
Officer
1999 – 2001 Senior
Manager of
PricewaterhouseCoopers.
1994 – 1999 Senior
Auditor, Manager of
Coopers & Lybrand.
CONSOLIDATED ANNUAL REPORT FOR 2021 | 111
15. Information on the amounts calculated by the Issuer, other assets transferred and
guarantees granted to the Members of the Board, the president and CFO
The Members of the Board and the president who are directly elected by the General Shareholders’ Meeting and have
concluded employment contracts with the company as well as CFO of the company are entitled only to a fixed salary. The
company does not have a policy concerning payment of a variable part of remuneration to the Board members or
management.
No assets were transferred or guarantees were given to the members of the Board during the reporting period. The company
did not award bonuses to the members of the Board. No special benefits were granted to the company's executives. The
Company's group companies did not award any bonuses to the members of the Board and the President of AB Invalda INVL.
During the year 2021, the total remuneration for the members of the Audit Committee of the company amounted to EUR
1,088.
INFORMATION ABOUT CALCULATED REMUNERATION FOR INVALDA INVL, AB MANAGERS FOR 2021
Calculated remuneration.
thousand EUR
2019
2020
2021
For members of the Board (according to employment contracts as employees of the
company)
4
285
251
220
For each member of the Board (average per month)
8
7
6
For members of administration (the President and CFO)
4
195
168
144
For each member of administration (average per month)
8.1
7.0
6.0
V. OTHER INFORMATION
16. Agreements with intermediaries on public trading in securities
Invalda INVL, AB has signed agreements with these intermediaries:
• Šiaulių Bankas, AB (Tilzes str. 149, Siauliai, Lithuania; tel. +370 41 595 607) – the agreement on investment
services, the agreement on management of securities accounting, the agreement on payment of dividends,
agreement regarding market making service;
• Luminor Bank AS Lithuanian Branch (Konstitucijos av. 21A, Vilnius, Lithuania; tel. +370 5 239 3444) – the
agreement on financial instruments account management, implementation of orders and offering recommendations;
• SEB Bankas, AB (Gedimino ave. 12, Vilnius, Lithuania; tel. +370 5 268 2370) – the agreement on management of
securities account;
• FMI Orion Securities, UAB (A. Tumeno str. 4. (block B), Vilnius, Lithuania; tel. +370 5 231 3841) - the agreement
on investment services;
• AB SEB Pank (Tornimae str. 2., 15010, Tallin, Estonia; tel. +372 6657 772) - the agreement of intermediation.
17. Information on Issuer’s branches and representative offices
Invalda INVL, AB has no branches or representative offices.
18. Risk management
18.1. A DESCRIPTION OF THE PRINCIPAL RISKS AND UNCERTAINTIES
Economic, geopolitical risks
The activities of the Invalda INVL group of companies are influenced by the general economic, geopolitical and legal
environment of the countries where businesses are developed and investments are made.
4
Remuneration by the company and group companies (including non-consolidated companies)
CONSOLIDATED ANNUAL REPORT FOR 2021 | 112
Economic recessions and downturns can affect the companies and assets that we have invested in, both directly and through
collective investment undertakings, and reduce their value, while negatively impacting our performance.
There is a risk that, in the event of inflation, the value of a stock will grow more slowly than inflation, leading to lower-than-
inflation returns. In this case, the real return on the increase in the value of the shares of the persons who sold the company's
shares on the market may be lower than expected. In the event of deflation, there would be a risk that the value of the
company's investments would decrease due to a decrease in the general price level.
Regulatory risk
The main activity of AB Invalda INVL Group is asset management. A significant part of the assets under management
consists of the assets of the second pillar pension funds in Lithuania and Latvia, therefore the changing laws related to the
pension system may negatively affect the results of this business line. We have opted for a regulated asset management
business model, so an increase in the regulatory burden may increase our costs and adversely affect profitability. The asset
management business must also meet capital adequacy ratios, which may result in additional contributions to the capital of
asset management companies in the event of a loss.
Changes in the laws or regulations governing our operations may have a material effect on our business. Changing tax
policy, as well as regulatory policy in sectors that depend on public funding, can have negative consequences for our
business.
Tax risk
Invalda INVL AB has concluded a number of transactions with related parties and its portfolio companies. Information on
transactions concluded by the company with related parties, as provided for in Article 37 (2) of the Law on Companies, is
made public. Under current tax law, transactions with related parties must be formalized (i.e., independently and under the
same conditions). Despite every effort made by management to ensure compliance with the above standard, the theoretical
tax risk remains, i.e. the risk that the applicable charges will be calculated on the basis of market prices if it has been
established that certain transactions have not been concluded in accordance with this principle, and the risk that appropriate
fines and interest will be charged.
Payouts and liquidity risk
By purchasing the company's shares, the shareholders assume the liquidity risk of the securities - if the demand for the
shares decreases or they are delisted from the stock exchange, investors would face difficulties in their realization. If the
company's financial situation deteriorates, the demand for the company's shares may decrease, as well as the price.
Our investments may be illiquid - there is a risk that the planned transactions will not take place when the management of
the issuer so requests. When investing in portfolio companies whose securities (shares, bonds and other financial
instruments) are not traded on regulated markets, there is a risk that the sale of securities may take longer than planned or
may not be due to lack of demand or other market conditions, or may not be as profitable as planned, or even unprofitable.
Our investments in corporate shares and collective investment undertakings are risky and, in the worst case, it is possible
to lose the entire amount invested.
We have not approved a dividend payment policy and have not set a minimum dividend, therefore the payment of funds to
shareholders is not guaranteed. Decisions to pay dividends depend on the profitability of operations, cash flows, investment
plans and the general financial situation and other circumstances.
Interest rate risk
Changes in interest rates can affect the cost of capital, profitability and the ability to attract additional financing. There is a
risk that if inflation rises, central banks will raise interest rates and the servicing of loans related to the company's investments,
which may reduce the value of the company's investments.
Credit risk
There is a risk that buyers of the products and services of direct portfolio companies, or businesses in which we have invested
through collective investment undertakings, will not meet their obligations, which would adversely affect profits. A large part
of the default on time may disrupt the issuer's normal operations and may require additional sources of funding, which may
not always be available. The issuer also incurs risks by holding funds in bank accounts or investing in short-term financial
instruments.
Risk of false expectations and assessments
The profitability of Invalda INVL investments may be significantly lower than the average profitability historically achieved by
the private equity industry, as past results do not reflect future profitability.
Invalda INVL may not be able to realize the profit from investments in shares of companies or collective investment
undertakings. The companies and collective investment undertakings in which we invest may not create value or even
destroy it by devaluing our investments.
The performance of the company and the group may fluctuate significantly and may not reflect future results.
CONSOLIDATED ANNUAL REPORT FOR 2021 | 113
The share price of Invalda INVL may fluctuate significantly. The price of the shares you have acquired as an investor may
be higher or lower, depending on many factors, some of which are beyond our control.
The market may value the shares of Invalda INVL less than the fair value of the assets.
Technological risk
The company may face attempts by other persons to find illegal access to the information systems of the company and / or
its group companies, which may pose a threat to the information security and system stability of the company and/or its
portfolio companies. The company and/or its portfolio companies may not be able to detect and protect against such theft
and attacks. Theft, unauthorized access and use of trade secrets and other confidential business information as a result of
such an event may materially harm the company's business, results of operations or financial condition.
Human resources risk
Invalda INVL AB and its asset management business and other companies and collective investment undertakings in which
we invest are also dependent on key executives - the loss of them could adversely affect the company's operations and we
could lose business opportunities.
18.2. INFORMATION ABOUT THE EXTENT OF RISK AND ITS MANAGEMENT IN THE COMPANY
Information on the extent of risks and management of them is disclosed in explanatory notes of consolidated and company’s
financial statements for 2021.
18.3. THE MAIN INDICATIONS ABOUT INTERNAL CONTROL AND RISK MANAGEMENT SYSTEMS RELATED TO
THE PREPARATION OF CONSOLIDATED FINANCIAL STATEMENTS
The Audit Committee supervises preparation of the consolidated financial statements. systems of internal control and
financial risk management and how the company follows legal acts that regulate preparation of consolidated financial
statements.
Chief financial officer of the company is responsible for the preparation supervision and the final revision of the consolidated
financial statements. Moreover, he constantly reviews International Financial Reporting Standards (IFRS) in order to
implement in time IFRS changes, analyses company’s and group’s significant deals. ensures collecting information from the
group’s companies and timely and fair preparation of this information for the financial statements. CFO of the company
periodically informs the Board about the preparation process of financial statements.
Standardized data collection files prepared by Excel program are used for preparation of consolidated numbers. It also
facilitates the automatic reconciliation and elimination of balances and transactions between subsidiaries in the preparation
of consolidated accounts. Internal control of the financial numbers of the Group’s entities and of the Group financial
statements is provided by CFO of the Company.
18.4. INFORMATION ON FINANCIAL RISK MANAGEMENT OBJECTIVES USED FOR HEDGING MEASURES WHICH
HEDGE ACCOUNTING
Information on financial risk management objectives used for hedging measures which hedge accounting and of price risk,
credit risk, liquidity risk and cash flow risk where the company group uses financial instruments and is an important evaluation
of the property, own capital, liabilities, revenue and expenses is disclosed in the consolidated and Company’s financial
statements for 2021 explanatory notes.
19. Issuer’s and its group companies’ non – financial results. Information related to
employees
19.1. EMPLOYEES
Average number of employees in 2021 was 7 (in 2020 it was 7). All company’s employees have higher university education.
CONSOLIDATED ANNUAL REPORT FOR 2021 | 114
Number of employees and average monthly salary
Measuring units
2019
2020
2021
Total amount of employees as of the end of the period
person
7
7
7
- managers
person
4
4
4
- specialists
person
3
3
3
Average monthly salary (calculated for)
EUR
4,023
4,658
4,656
- managers
EUR
5,626
6,489
5,979
- specialists
EUR
1,871
2,195
2,892
Number of employees in Invalda INVL Group was 459 on 31 December 2021 (537 on 31 December 2020). The decrease in
the number of employees of the group was mainly determined by the exit of the company Kelio ženklai from the group after
the sale of the company's shares.
19.2. INFORMATION ABOUT AGREEMENTS OF THE COMPANY AND THE MEMBERS OF THE BOARD, OR THE
EMPLOYEES’ AGREEMENTS PROVIDING FOR COMPENSATION IN CASE OF THE RESIGNATION OR IN CASE THEY
ARE DISMISSED WITHOUT A DUE REASON OR THEIR EMPLOYMENT IS TERMINATED IN VIEW OF THE CHANGE
OF THE CONTROL OF THE COMPANY.
There are no agreements of the company and the Members of the Board, or the employees’ agreements providing for
compensation in case of the resignation or in case they are dismissed without a due reason or their employment is terminated
in view of the change of the control of the company.
20. Memberships in associations
Invalda INVL along with INVL Asset Management in Latvia is a full member of Invest Europe – the organisation that unites
Europe’s private equity and venture capital companies and investors.
Invalda INVL is also part of the Lithuanian Private Equity and Venture Capital Association, which brings together the
participants of Lithuania’s private equity and venture capital market. The organisation’s main goal is, together with the
competent Lithuanian institutions and partners, to take part in shaping and implementing a common policy for the PE/VC
industry.
Invalda INVL together with its INVL Asset Management companies in Lithuania and Latvia, has joined the UN-supported
Principles for Responsible Investment (PRI) in the middle of 2017. The PRI, founded in 2006, is a global network of over
1700 investors, aims to assess the investment implications of environmental, social and governance (ESG) factors. An
economically efficient, sustainable global financial system is considered a necessity for long-term value creation. Investors
who support the PRI voluntarily work to apply the principles in their investment activities.
Invalda INVL has joined the Investors' Association at the end of 2017. The main activities include the following areas:
organization of meetings with business leaders and events on the financial markets of the members of the association, the
minority investors' rights advocacy, development of centers of excellence, providing the scientific findings based on the
recommendations of the Government and Parliament, drawing attention and warning about the opportunities and risks
associated with investing.
Group company INVL Asset Management is a member of Lithuanian investment and pension funds (LIPFA)
Association. LIPFA is an independent organisation that brings together the country's private investment management
companies and branches of commercial banks engaged in investment activities. Members of the association actively
participates in the activities of the association and contribute to the promotion of investment and the favourable environment
for Lithuania.
Lithuanian Investment Managers Association (LIVA), one of whose founders is INVL Asset Management, aims to
contribute to the development of investment, fund improvements in the legal environment and investor education.
INVL Asset Management is an associate member of The Association of Lithuanian Banks. This association seeks to
ensure a good environment for the banking sector and achieve direct dialogue with the public, supervisory authorities and
legislators.
CONSOLIDATED ANNUAL REPORT FOR 2021 | 115
21. Information on harmful transactions in which the issuer is a party
There were no harmful transactions (those that are not in line with issuer‘s goals, not under usual market terms. harmful to
the shareholders‘ or stakeholders‘ interests. etc.) made in the name of the issuer that had or potentially could have negative
effects in the future on the issuer‘s activities or business results. There were also no transactions where a conflict of interest
was present between issuer‘s management‘s, controlling shareholders‘ or other related parties‘ obligations to the issuer and
their private interests.
22. Information on the related parties’ transactions
During the reporting period, the largest share of the company and a group of transactions with related parties accounted for
loans, computer services, rent and utility costs of purchases, land administration services and asset management services
(only group). The detailed information on the related parties’ transactions has been disclosed in the section 26 of the
consolidated and Company’s financial statements for 2021 explanatory notes.
In addition, information regarding Transactions with Related Parties, according to the Law on Companies article 37 (2) , is
published on the Company‘s web site: https://www.invaldainvl.com/en/investor-relations/financial-information-and-
documents/related-parties-transactions/
Information on the Company's related party transactions published on the Company's website is provided in Annex 3, Part
5 to this Consolidated Annual Management Report.
Pursuant to paragraph 10 of Article 37 (2) of the Law on Companies of the Republic of Lithuania, the Company report the
amounts of the Company's transactions with related parties, which were implemented in the ordinary course of business and
with the same related party in the financial year.
Transaction value, EUR
Related party
Sales revenue from
related party
Purchase costs from a
related party
UAB Cedus Invest
Code 302576631, Gynėjų g. 14, Vilnius, Lithuania
Register of Legal Entities
4,554,366
-
UAB Aktyvo
Code 301206846, Gynėjų g. 14, Vilnius, Lithuania
Register of Legal Entities
348
-
UAB Įmonių grupė Inservis
Code 301673796, Gynėjų g. 14, Vilnius, Lithuania
Register of Legal Entities
1,148
-
UAB MD Partners
Code 304842899, Gynėjų g. 14, Vilnius, Lithuania
Register of Legal Entities
1,160
-
UAB INVL Farmland Management
Code 303788352, Gynėjų g. 14, Vilnius, Lithuania
Register of Legal Entities
2,680
-
UAB „INVL Asset Management“
Code 126263073, Gynėjų g. 14, Vilnius, Lithuania
Register of Legal Entities
695
3,267
UAB „INVL Life“
Code 305859887, Gynėjų g. 14, Vilnius, Lithuania
Register of Legal Entities
265,226
UAB „Inservis“
Code 126180446, A. Juozapavičiaus g. 6, Vilnius, Lithuania
Register of Legal Entities
-
53
SUTNTIB INVL Baltic Real Estate
Code 152105644, Gynėjų g. 14, Vilnius, Lithuania
Register of Legal Entities
15,593
-
UAB Proprietas
Code 303252098, Gynėjų g. 14, Vilnius, Lithuania
Register of Legal Entities
10,000
-
UAB Rovelija
Code 302575846, Gynėjų g. 14, Vilnius, Lithuania
Register of Legal Entities
1,738
-
UAB Novian Technologies
Code 301318539, Gynėjų g. 14, Vilnius, Lithuania
Register of Legal Entities
-
6,858
UAB FINtime
Code 304192355, Gynėjų g. 14, Vilnius, Lithuania
Register of Legal Entities
17,085
-
CONSOLIDATED ANNUAL REPORT FOR 2021 | 116
UAB Novian Systems
Code 300935644, Gynėjų g. 14, Vilnius, Lithuania
Register of Legal Entities
-
1,451
UAB Avižėlė
Code 303113077, Gynėjų g. 14, Vilnius, Lithuania
Register of Legal Entities
1,663
-
UAB Beržytė
Code 30112915, Gynėjų g. 14, Vilnius, Lithuania
Register of Legal Entities
1,663
-
UAB Dirvolika
Code 303112954, Gynėjų g. 14, Vilnius, Lithuania
Register of Legal Entities
1,663
-
UAB Duonis
Code 303112790, Gynėjų g. 14, Vilnius, Lithuania
Register of Legal Entities
1,663
-
UAB Ekotra
Code 303112623, Gynėjų g. 14, Vilnius, Lithuania
Register of Legal Entities
1,663
-
UAB Kvietukas
Code 303112687, Gynėjų g. 14, Vilnius, Lithuania
Register of Legal Entities”
1,663
-
UAB Laukaitis
Code 303112694, Gynėjų g. 14, Vilnius, Lithuania
Register of Legal Entities
1,663
-
UAB Lauknešys
Code 303112655, Gynėjų g. 14, Vilnius, Lithuania
Register of Legal Entities
1,663
-
UAB Linažiedė
Code 303112922, Gynėjų g. 14, Vilnius, Lithuania
Register of Legal Entities
1,663
-
UAB Pušaitis
Code 303113102, Gynėjų g. 14, Vilnius, Lithuania
Register of Legal Entities
1,663
-
UAB Puškaitis
Code 303112769, Gynėjų g. 14, Vilnius, Lithuania
Register of Legal Entities
1,663
-
UAB Sėja
Code 303113013, Gynėjų g. 14, Vilnius, Lithuania
Register of Legal Entities
1,663
-
UAB Vasarojus
Code 303112776, Gynėjų g. 14, Vilnius, Lithuania
Register of Legal Entities
1,663
-
UAB Žemgalė
Code 303112744, Gynėjų g. 14, Vilnius, Lithuania
Register of Legal Entities
1,663
-
UAB Žemynėlė
Code 303112559, Gynėjų g. 14, Vilnius, Lithuania
Register of Legal Entities
1,663
-
UAB Žiemkentys
Code 303112648, Gynėjų g. 14, Vilnius, Lithuania
Register of Legal Entities
1,663
-
UAB Žalvė
Code 303113045, Gynėjų g. 14, Vilnius, Lithuania
Register of Legal Entities
1,663
-
UAB Cooperor
Code 303252162, Gynėjų g. 14, Vilnius, Lithuania
Register of Legal Entities
348
-
AB INVL Baltic Farmland
Code 303299781, Gynėjų g. 14, Vilnius, Lithuania
Register of Legal Entities
8,115
-
CONSOLIDATED ANNUAL REPORT FOR 2021 | 117
Related party
Balance of
loans
granted
01.01.2021
Loans
granted
during 2021
Interest
calculated
during
2021
Loans
returned
during
2021
Interest
paid
during
2021
Balance of
loans
granted
31.12.2021
UAB Kelio ženklai*
Code 185274242,
Geležinkelio g. 28, Pilviškiai
Register of Legal Entities
296,670
55,000
5,902
351,670
5,902
-
UAB Litagra
Code 304564478,
Savanorių per. 173, Vilnius,
Register of Legal Entities
-
2,234,000
4,958
-
-
2,238,958
* UAB Kelio ženklai is considered a related party until 27.05.2021, when the company was sold to the third parties. The granted loans were
repaid on 27.05.2021, including them as a new loan to the third parties to settle the purchased shares.
Related party
Balance of
loans
received
01.01.2021
Loans
received
during 2021
Interest
calculated
during
2021
Loans
returned
during
2021
Interest
paid
during
2021
Balance of
loans
granted
31.12.2021
UAB Aktyvo
Code 301206846
Gynėjų g. 14, Vilnius, Lithuania
Register of Legal Entities
27,665
-
520
27,276
909
-
23. Information about significant agreements to which the issuer is a party, which
would come into force, be amended or cease to be valid if there was a change in
issuer‘s controlling shareholder, and their impact
In 2021 there were no concluded significant agreements of the company which would come into force, be amended or cease
to be valid if there was a change in issuer‘s controlling shareholder.
24. Significant investments made during the reporting period and after the end of the
financial year
15 June 2021 Invalda INVL has signed a deal in principle with Mandatum Life Insurance Company Limited to acquire
insurance business. A new company to be established by Invalda INVL in due course will take over the Baltic life insurance
business subject to required approvals. Completion of the transaction is anticipated for the middle of 2022 subject to Baltic
and Finnish regulatory approval for permissions and licencing. More information https://www.invaldainvl.com/en/regulated-
information/invalda-invl-agrees-deal-in-principle-to-acquire-mandatum-lifes-baltic-insurance-business/
In the beginning of 2022 the Board of Invalda INVL has decided to increase the share capital of its subsidiary INVL Life,
which in the beginning of March 2022 has been granted by the Bank of Lithuania a licence to conduct life insurance activities,
from EUR 7.5 million to EUR 48 million by transferring the following shareholdings to INVL Life for a preliminary amount of
EUR 36 million: (i) 1,889,123 shares, which makes up 23.43 percent of the authorized capital, of INVL Baltic Real Estate; (ii)
1,873,678 shares, which makes up 15.39 percent of the authorized capital, of INVL Technology; (iii) Cedus invest (100% of
shares), through which Invalda INVL has invested in Litagra; (iv) part, equal to EUR 7,621,959.71 capital contributed, of the
units of the private equity investment fund INVL Baltic Sea Growth Fund, a closed-end investment fund for professional
investors, (outstanding capital commitment is not transferred). More information https://www.invaldainvl.com/en/regulated-
information/invalda-invl-increases-share-capital-of-its-subsidiary-invl-life-and-transfers-part-of-shares-to-it/
On 22 December 2021, Invalda INVL signed a Share Purchase-Sale Agreement with the European Bank for Reconstruction
and Development. The parties agreed that Invalda INVL will directly and/or indirectly acquire from EBRD 35,240,296 shares
of Šiaulių bankas by 31 May 2024 at the latest. The shares will not be acquired all at once, but in instalments, in separate
tranches. The parties have agreed that the initial price for Šiaulių bankas shares is EUR 0.633 per share and it will be
recalculated during every payment considering dividends paid or other changes in capital by Šiaulių bankas, as well as 5%
annual interest calculated from the date of signing the agreement. More information
https://www.invaldainvl.com/en/regulated-information/invalda-invl-intends-to-increase-its-stake-in-siauliu-bankas/
CONSOLIDATED ANNUAL REPORT FOR 2021 | 118
More information is provided in the section 3 of the consolidated and Company’s financial statements for 2021 explanatory
notes.
25. References to and additional explanations of the data presented in the financial
statements and consolidated financial statements
All data is presented in consolidated and company’s financial statements explanatory notes.
26. Data on the publicly disclosed information
The information publicly disclosed by Invalda INVL, AB during 2021 is presented on the company’s website
www.invaldainvl.com
SUMMARY OF PUBLICLY DISCLOSED INFORMATION
Published
Headline
Message Category
26.03.2021
Invalda INVL is reducing its stake in INVL Baltic Real Estate
Notification on material event
08.04.2021
Convocation of the ordinary general shareholders meeting of
Invalda INVL
General meeting of
shareholders
08.04.2021
Draft resolutions prepared by the Board for the shareholders'
meeting of Invalda INVL to be held on 30/04/2021
General meeting of
shareholders
08.04.2021
Audited results of Invalda INVL Group for 2020
Notification on material event
16.04.2021
Įmonių Grupė Inservis, a subsidiary of Invalda INVL, sold
shares in Informacinio Verslo Paslaugų Įmonė
Other information
28.04.2021
„INVL Emerging Europe Bond Fund“, a subfund of INVL Asset
Management, a subsidiary of Invalda INVL, will be managed
from Luxembourg
Other information
30.04.2021
The resolutions of the Ordinary General Shareholders
Meeting of Invalda INVL
General meeting of
shareholders
30.04.2021
Audited annual information of Invalda INVL for 2020
Annual information
18.05.2021
INVL Baltic Sea Growth Fund’s Eco Baltia to acquire majority
stake in Ecoservice
Other information
19.05.2021
Invalda INVL signed employee stock option contracts
Notification on material event
19.05.2021
Notification on transactions in the issuer's securities
Notifications on transactions
concluded by managers of the
companies
31.05.2021
Unaudited information of Invalda INVL group for 3 months of
2021
Notification on material event
04.06.2021
Invalda INVL sold the shares in Kelio ženklai
Other information
10.06.2021
A new wording of Articles of Association of Invalda INVL has
been registered. The issued shares were acquired by the
group's employees
Notification on material event
10.06.2021
Information about shares issued by Invalda INVL and votes
granted
Total number of voting rights
and capital
15.06.2021
Invalda INVL agrees deal in principle to acquire Mandatum
Life’s Baltic insurance business
Notification on material event
17.06.2021
INVL Sustainable Timberland and Farmland Fund II holds
second close at EUR 51 mln
Other information
20.07.2021
INVL Asset Management, a subsidiary of Invalda INVL,
establishes INVL Renewable Energy Fund I, a sub-fund that
will invest in renewable energy
Other information
23.07.2021
Notification on transactions in the issuer's securities
Notifications on transactions
concluded by managers of the
companies
CONSOLIDATED ANNUAL REPORT FOR 2021 | 119
23.07.2021
Notification about acquisition of voting rights of Invalda INVL
Acquisition or disposal of a
block of shares
04.08.2021
INVL Renewable Energy Fund I, a fund managed by INVL
Asset Management, a subsidiary of Invalda INVL, raised EUR
18.5 million
Other information
12.08.2021
Invalda INVL establishes INVL Life which will seek an
insurance company licence
Other information
17.08.2021
INVL Baltic Sea Growth Fund’s Eco Baltia completes
acquisition for majority stake in Ecoservice
Other information
31.08.2021
Unaudited information of Invalda INVL group for 6 months of
2021
Half-Yearly information
03.11.2021
Invalda INVL analyses strategic options for the companies of
the Inservis Group
Notification on material event
04.11.2021
INVL Renewable Energy Fund I, a fund managed by INVL
Asset Management, a subsidiary of Invalda INVL, raised
additional EUR 16.14 million
Other information
08.11.2021
Supplement: Invalda INVL analyses strategic options for the
companies of the Inservis Group
Notification on material event
19.11.2021
INVL Asset Management , a subsidiary of Invalda INVL,
launches INVL Partner Global Infrastructure Fund I subfund
Other information
30.11.2021
Unaudited information of Invalda INVL group for 9 months of
2021
Notification on material event
02.12.2021
INVL Baltic Forests Fund I, a fund on Invalda INVL group,
ends its activities with a 27% annual rate of return
Other information
10.12.2021
Invalda INVL investor's calendar for 2022
Other information
22.12.2021
Invalda INVL intends to increase its stake in Šiaulių bankas
Notification on material event
28.12.2021
Invalda INVL has agreed on the sale of shares in Inservis
Group companies
Notification on material event
Summary of reports about transactions concluded in 2021 by persons employed in management positions and persons
closely associated with them
Announce
ment date
Date of
transaction
Person
Shares,
units
Share price, EUR
Type of transaction
Place of
transaction
19.05.2021
18.05.2021
R.Rajeckas, CFO of
the issuer
8,308
0.20
Acquisition. Share
subscription agreement to
exercise the option
transaction of 25 April 2018,
which entered into force on
3 May 2018.
Outside a
trading
venue
23.07.2021
21.07.2021
UAB Lucrum
investicija, legal entity
related to D.Šulnis,
the issuer's CEO
175,761
8.00
Acquisition
Outside a
trading
venue
23.07.2021
21.07.2021
UAB Lucrum
investicija, legal entity
related to D.Šulnis,
the issuer's CEO
202,449
8.00
Acquisition
Outside a
trading
venue
23.07.2021
21.07.2021
UAB LJB investment,
legal entity related to
A.Banys, the
chairman of the Board
of the issuer
202,449
8.00
Sale
Outside a
trading
venue
CONSOLIDATED ANNUAL REPORT FOR 2021 | 120
27. Information on audit company
The company have not approved criteria for selection of the audit company. Usually the big-four audit companies are
attending the competition (Deloitte, KPMG, PricewaterhouseCoopers, Ernst and Young).
The Company's and the Consolidated Financial Statements for the year 2021 were audited by the audit firm KPMG Baltics,
UAB (company code 111494971, registered address is Lvovo str. 101, Vilnius). It was elected by the shareholders for the
audit of the annual financial statements for 2019-2021 at the Extraordinary General Meeting of Shareholders held on 14
October 2019. At the same meeting, the shareholders set a total remuneration of up to EUR 75 thousand for the audit of the
sets of annual financial statements for the period 2019-2021 and the statement on the annual reports (value added tax is
calculated and paid in accordance with the law).
Audit company
„KPMG Baltics”, UAB
Address of the registered office
Lvovo str. 101, Vilnius, Lithuania
Enterprise code
111494971
Telephone
+370 5210 2600
E-mail
vilnius@kpmg.lt
Website
www.kpmg.com/LT
No internal audit is performed in the company.
ALL THE SERVICES GRANTED TO INVALDA INVL AND THE ITS GROUP BY THE AUDITOR KPMG BALTICS
EUR
Group
2021
Company
2021
Financial statement audit services under contracts (including audit services for
funds financial statements)
136,389
25,490
Costs of collateral and other related services
-
-
Costs for tax advice issues
-
-
Costs for other services (including funds)
1,050
-
In total
137,439
25,490
signed with qualified electronic signature
President
Darius Šulnis
CONSOLIDATED ANNUAL REPORT FOR 2021 | 121
APPENDIX 1. INFORMATION ABOUT GROUP COMPANIES, THEIR CONTACT
DETAILS
Company
Registration information
Type of activity
Contact details
ASSET MANAGEMENT BUSINESS
INVL Asset Management,
UAB
Code 126263073
Address Gynėjų str. 14, Vilnius
Legal form – private limited
liability company
Registration date 21.07.2003
Pension and investment
funds management.
portfolio management
services, real estate
funds management
Telephone +370 700
55959
E-mail info@invl.com
www.invl.com
INVL Asset Management,
IPAS (Latvia)
Code 40003605043
Address Elizabetes iela 10B-1.
Riga, Latvia
Legal form – private limited
liability company
Registration date 02.10.2002
Pension and investment
funds management,
portfolio management
services
Telephone +371 67 092
988
E-mail LV@invl.com
www.invl.com/lat/lv
AS INVL Atklātais pensiju
fonds (Latvia)
Code 40003377918
Address Elizabetes iela 10B-1,
Riga, Latvia
Legal form – limited liability
company
Registration date 04.02.1998
Pension funds
Tel. +371)67 092 988
E-mail LV@invl.com
www.invl.com/lat/lv
INVL Farmland
Management
Code 303788352
Address Gynėjų str. 14, Vilnius
Legal form – private limited
liability company
Registration date 26.02.2016
Administration of
agricultural land
E-mail
juste.gumovskiene@invl.c
om
INVL Finasta, FMĮ UAB
Code 304049332
Address Gynėjų str. 14, Vilnius
Legal form – private limited
liability company
Registration date 28.05.2015
Family office services
Tel. +370 700 55 959
E-mail
gerovesvaldymas@invl.c
om
www.invl.com
Mundus UAB, asset
management company
Code 303305451
Address Gynėjų str. 14-120,
Vilnius
Legal form – private limited
liability company
Registration date 07.05.2014
Management of
investment funds
info@mundus.lt
www.mundus.lt
Invalda INVL Investments,
UAB
Code 303252237
Address Gynėjų str. 14, Vilnius
Legal form – private limited
liability company
Registration date 27.02.2014
carries no activity
Telephone +370 5 263
6129
INVL Life, UAB
Code 305859887
Address Gynėjų str. 14, Vilnius
Legal form – private limited
liability company
Registration date 11.08.2021
Life insurance activities
www.invl.com
INVL LUX GP1 S.a.r.l
Code B248090
Address 3, Rue Gabriel
Lippmann, L - 5365 Munsbach,
Grand Duchy of Luxembourg
Legal form – private limited
liability company
Registration 29.10.2020
General Partner of the
Luxembourg umbrella
fund; investment in
Luxembourg and foreign
companies.
OTHER INVESTMENTS
Cedus Invest, UAB
Code 302576631
Address Gynėjų str. 14, Vilnius
Legal form – private limited
liability company
Registration date 20.12.2010
investments into
agriculture companies
Telephone +370 5 263
6129
CONSOLIDATED ANNUAL REPORT FOR 2021 | 122
Inservis, UAB
Code 126180446
Address Juozapaviciaus str. 6.
Vilnius
Legal form – private limited
liability company
Registration date 25.03.2003
facility management.
engineering systems
oversight and incidents
management. multi-
apartment house
management
Telephone +370 5 273
6607
E-mail
prieziura@inservis.lt
www.inservis.lt
Priemiestis, UAB
Code 221487620
Address Stepono Batoro str. 41.
Vilnius
Legal form – private limited
liability company
Registration date 09.07.1992
facility management.
engineering systems
oversight and incidents
management, multi-
apartment house
management
Telephone +370 5 267
0204
Fax +370 5 267 2941
E-mail
info@priemiestis.lt
www.priemiestis.lt
Jurita, UAB
Code 220152850
Address Justiniskiu str. 62.
Vilnius
Legal form – private limited
liability company
Registration date 28.12.1990
Facility management.
engineering systems
oversight and incidents
management, multi-
apartment house
management
Telephone +370 5 248
2088
E-mail info@jurita.lt
www.jurita.lt
Imoniu Grupe Inservis,
UAB
Code 301673796
Address Gynėjų str. 14, Vilnius
Legal form – private limited
liability company
Registration date 07.04.2008
investing in building
maintenance companies
Telephone +370 5 263
6129
"IPP integracijos projektai",
UAB
Code 302890482
Address Palangos str. 4, Vilnius
Legal form – private limited
liability company
Registration date 12.10.2012
Carries no activity
-
SIA „Inservis“ (Latvia)
Code 40203041770
Address - Olaines nov., Olaines
pag., Stūnīši, "Lapegles", Latvia
Legal form – private limited
liability company
Registration date 02.01.2017
Facilities management
-
Iniciatyvos Fondas, VsI
Code 300657209
Address Gynėjų str. 14. Vilnius
Legal form – public institution
Registration date 08.03.2007
organising of social
initiative programmes
Telephone +370 5 263
6129
Fax +370 5 279 0530
E-mail
info@iniciatyvosfondas.lt
www.iniciatyvosfondas.lt
Aktyvo, UAB
Code 301206846
Address Gynėjų str. 14, Vilnius;
Legal form – private limited
liability company
Registration date 31.10.2007
carries no activity
Telephone +370 5 263
6129
Aktyvus Valdymas, UAB
Code 301673764
Address Gynėjų str. 14, Vilnius
Legal form – private limited
liability company
Registration date 07.04.2008
carries no activity
Telephone +370 5 263
6129
MBGK, UAB
Code 300083611
Address Gynėjų str. 14, Vilnius
Legal form – private limited
liability company
Registration date 27.01.2005
carries no activity
Telephone +370 5 263
6129
MGK Invest, UAB
Code 302531757
Address Gynėjų str. 14, Vilnius
Legal form – private limited
liability company
Registration date 27.07.2010
carries no activity
Telephone +370 5 263
6129
Consult Invalda, UAB
Code 302575814
Address Gynėjų str. 14, Vilnius
Legal form – private limited
liability company
Registration date 20.12.2010
carries no activity
Telephone +370 5 263
6129
CONSOLIDATED ANNUAL REPORT FOR 2021 | 123
RPNG, UAB
Code 302575892
Address Gynėjų str. 14, Vilnius
Legal form – private limited
liability company
Registration date 20.12.2010
carries no activity
Telephone +370 5 263
6129
Regenus, UAB
Code 302575821
Address Gynėjų str. 14, Vilnius
Legal form – private limited
liability company
Registration date 20.12.2010
carries no activity
Telephone +370 5 263
6129
Fax +370 5 279 0530
Cedus, UAB
Code 302656796
Address Gynėjų str. 14, Vilnius
Legal form – private limited
liability company
Registration date 18.08.2011
carries no activity
Telephone +370 5 263
6129
MD Partners UAB
Code 304842899
Address Gynėjų str. 14, Vilnius
Legal form – private limited
liability company
Registration date 14.05.2018
SPV for investment into
Moldova-Agroindbank
Telephone +370 5 263
6129
CONSOLIDATED ANNUAL REPORT FOR 2021 | 124
APPENDIX 2. DISCLOSURE CONCERNING THE COMPLIANCE WITH THE
GOVERNANCE CODE
Invalda INVL, AB (hereinafter referred to as the “Company”), acting in compliance with Article 12 (3) of the Law on Securities
of the Republic of Lithuania and paragraph 24.5 of the Listing Rules of AB Nasdaq Vilnius, hereby discloses how it complies
with the Corporate Governance Code for the Companies listed on Nasdaq Vilnius as well as its specific provisions or
recommendations. In case of non-compliance with this Code or some of its provisions or recommendations, the specific
provisions or recommendations that are not complied with must be indicated and the reasons for such non-compliance must
be specified. In addition, other explanatory information indicated in this form is provided.
1. Summary of the Corporate Governance Report:
Invalda INVL, AB has a General Meeting of Shareholders and a single-person managing body - the President of the
Company. The Company has a collegial management body - the Board.
The President is elected, recalled and dismissed, his salary is fixed, his job description is approved, he is promoted and
penalties are imposed by the Board of the Company. The Board of the Company is elected by the General Meeting of
Shareholders for the term of 4 years. The Board shall have all the powers provided for in the Articles of Association of the
Company as well as such powers as the Board may have by law. The activities of the Board are based on collegial
deliberation and decision making, as well as joint responsibility to the shareholders' meeting for the consequences of the
decisions made. In order to maximize the benefit for the company and its shareholders, and to ensure the integrity and
transparency of the company's financial accounting and control system, the Board works closely with the Company's
President.
The supervisory board is not formed in the Company. Nevertheless, the Company's Board and the President work closely
together to maximize benefits for the Company and all its shareholders.
The Company has an Audit Committee consisting of 2 independent members. The members of the Audit Committee are
elected and recalled by the General Meeting of Shareholders for the term of four years. The establishment of the Risk,
Nomination and Compensation Committees is not expedient due to the size of the Company.
The Company's Remuneration Policy was approved by the General Meeting of Shareholders on 30 April 2020.
Although the form for filling in the Corporate Governance Code of Nasdaq Vilnius listed companies is based on the “comply
or explain” principle, the company, taking into account the recommendations of the Bank of Lithuania, provides an
explanation in the “Comment” section in all cases, even if it fully complies with the principle.
2. Structured table for disclosure:
PRINCIPLES/ RECOMMENDATIONS
YES/NO/
NOT
APPLICABLE
COMMENTARY
Principle 1: General meeting of shareholders, equitable treatment of shareholders, and shareholders’ rights
The corporate governance framework should ensure the equitable treatment of all shareholders. The corporate
governance framework should protect the rights of shareholders.
1.1. All shareholders should be provided with access to the information
and/or documents established in the legal acts on equal terms. All
shareholders should be furnished with equal opportunity to
participate in the decision-making process where significant
corporate matters are discussed.
YES
The Company discloses all
regulated information through
the Nasdaq Vilnius news
distribution platform.
Information is provided
simultaneously in both
Lithuanian and English. The
company publishes information
before or after the Nasdaq
Vilnius trading session. The
Company periodically updates
information in Lithuanian and
English on its website. As the
company has not issued
preference or non-voting
shares, all shareholders have
equal rights to participate in the
general meetings of
shareholders of the company.
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1.2. It is recommended that the company’s capital should consist only
of the shares that grant the same rights to voting, ownership,
dividend and other rights to all of their holders.
YES
Since the company did not
issue any privileged or non-
voting shares, the shares
constituting the authorized
capital of the company grant
equal rights to all shareholders
of the company.
1.3. It is recommended that investors should have access to the
information concerning the rights attached to the shares of the new
issue or those issued earlier in advance, i.e. before they purchase
shares.
YES
The company informs about
the rights granted by the newly
issued shares. Information on
the rights granted by the
already issued shares of the
company is provided in the
Articles of Association of the
company, in the annual report.
1.4.Exclusive transactions that are particularly important to the
company, such as transfer of all or almost all assets of the company
which in principle would mean the transfer of the company, should
be subject to approval of the general meeting of shareholders.
YES/NO
The Articles of Association of
the company do not contain a
provision specified in Article 34
(5) of the Law on Companies,
i.e. decision-making on the sale
of fixed assets with a book
value higher than 1/20 of the
authorized capital is not
referred to the shareholders'
meeting. However, the
company's board is of the
opinion and practice that all
highly significant and
exceptional strategic
transactions must be made
only with the approval of the
shareholders' meeting.
1.5.Procedures for convening and conducting a general meeting of
shareholders should provide shareholders with equal opportunities
to participate in the general meeting of shareholders and should not
prejudice the rights and interests of shareholders. The chosen
venue, date and time of the general meeting of shareholders should
not prevent active participation of shareholders at the general
meeting. In the notice of the general meeting of shareholders being
convened, the company should specify the last day on which the
proposed draft decisions should be submitted at the latest.
YES
Shareholders shall be informed
about the convened general
meeting in accordance with the
notice deadlines, methods of
publication and means
established by legal acts. The
possibility to participate in the
meeting is additionally
implemented by providing an
opportunity to vote by filling in a
ballot paper or authorizing
another person to represent the
shareholder. The General
Meeting of Shareholders is
held at the address of the
Company's registered office.
The Company does not restrict
the right of shareholders to
submit new draft resolutions
both before and during the
meeting and this is clearly
stated in the notice of the
convened general meeting of
shareholders in Lithuanian and
English.
1.6.With a view to ensure the right of shareholders living abroad to
access the information, it is recommended, where possible, that
documents prepared for the general meeting of shareholders in
advance should be announced publicly not only in Lithuanian
language but also in English and/or other foreign languages in
advance. It is recommended that the minutes of the general
meeting of shareholders after the signing thereof and/or adopted
decisions should be made available publicly not only in Lithuanian
language but also in English and/or other foreign languages. It is
recommended that this information should be placed on the
website of the company. Such documents may be published to the
YES
All documents and information
relevant to the company's
general meetings of
shareholders, including the
notice of the convened
meeting, draft resolutions of the
meeting are public and
simultaneously published in
Lithuanian and English through
the Nasdaq Vilnius news
distribution system and
additionally published on the
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5
For the purposes of this Code, heads of the administration are the employees of the company who hold top level
management positions.
extent that their public disclosure is not detrimental to the company
or the company’s commercial secrets are not revealed.
company's website. At the end
of the shareholders' meeting,
the company announces the
adopted resolutions in the
same manner as for the
convening of the meeting.
1.7.Shareholders who are entitled to vote should be furnished with the
opportunity to vote at the general meeting of shareholders both in
person and in absentia. Shareholders should not be prevented from
voting in writing in advance by completing the general voting ballot.
YES
The shareholders of the
company may exercise the
right to participate in the
shareholders' meeting both in
person and through a
representative, if the person
has a proper power of attorney
or a contract for the transfer of
voting rights concluded with
him in accordance with the
procedure established by legal
acts. The company also
enables shareholders to vote
by filling in the general voting
ballot, which is published
together with all information
about the convened meeting.
1.8.With a view to increasing the shareholders’ opportunities to
participate effectively at general meetings of shareholders, it is
recommended that companies should apply modern technologies
on a wider scale and thus provide shareholders with the conditions
to participate and vote in general meetings of shareholders via
electronic means of communication. In such cases the security of
transmitted information must be ensured and it must be possible to
identify the participating and voting person.
NO
Shareholders can vote via an
attorney or by completing the
general voting bulletin, as for
now shareholders cannot
participate and vote in General
Shareholders’ Meetings via
electronic means of
communication.
1.9.It is recommended that the notice on the draft decisions of the
general meeting of shareholders being convened should specify
new candidatures of members of the collegial body, their proposed
remuneration and the proposed audit company if these issues are
included into the agenda of the general meeting of shareholders.
Where it is proposed to elect a new member of the collegial body,
it is recommended that the information about his/her educational
background, work experience and other managerial positions held
(or proposed) should be provided.
YES
At least 10 days prior to the
general meeting of
shareholders at which the
members (member) of the
Board are to be elected, the
shareholders shall be disclosed
about the candidates for the
members of the Board.
The elected members of the
Board shall inform the
Chairman of the Board about
the changed data. The
information is disclosed in the
company's annual reports.
Data on the current members
of the company's board, their
education, qualifications,
professional experience,
participation in the activities of
other companies are also
disclosed on the company's
website.
1.10.Members of the company’s collegial management body, heads of
the administration
5
or other competent persons related to the
company who can provide information related to the agenda of the
general meeting of shareholders should take part in the general
meeting of shareholders. Proposed candidates to member of the
collegial body should also participate in the general meeting of
shareholders in case the election of new members is included into
the agenda of the general meeting of shareholders.
YES
Recently, all interested
shareholders voted in advance
by submitting completed ballot
papers and meetings were not
held live. However, the head of
the company and the chief
financier are ready to attend
the shareholders' meeting.
The proposed candidates for
the members of the collegial
body participate in the meeting
if possible.
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6
For the purposes of this Code, the criteria of independence of members of the supervisory board are interpreted as the
criteria of unrelated parties defined in Article 31(7) and (8) of the Law on Companies of the Republic of Lithuania.
Principle 2: Supervisory board
2.1. Functions and liability of the supervisory board
The supervisory board of the company should ensure representation of the interests of the company and its shareholders,
accountability of this body to the shareholders and objective monitoring of the company’s operations and its management
bodies as well as constantly provide recommendations to the management bodies of the company.
The supervisory board should ensure the integrity and transparency of the company’s financial accounting and control
system.
2.1.1. Members of the supervisory board should act in good faith, with
care and responsibility for the benefit and in the interests of the
company and its shareholders and represent their interests, having
regard to the interests of employees and public welfare.
NOT
APPLICABLE
Due to its size, it is not
expedient to form the
Supervisory Board.
Considering that only collegial
management body - the Board
is formed in the Company. It
performs all essential
management functions and
ensures accountability and
control of CEO of the
Company.
2.1.2. Where decisions of the supervisory board may have a different
effect on the interests of the company’s shareholders, the supervisory
board should treat all shareholders impartially and fairly. It should
ensure that shareholders are properly informed about the company’s
strategy, risk management and control, and resolution of conflicts of
interest.
2.1.3. The supervisory board should be impartial in passing decisions
that are significant for the company’s operations and strategy.
Members of the supervisory board should act and pass decisions
without an external influence from the persons who elected them.
2.1.4. Members of the supervisory board should clearly voice their
objections in case they believe that a decision of the supervisory board
is against the interests of the company. Independent
6
members of the
supervisory board should: a) maintain independence of their analysis
and decision-making; b) not seek or accept any unjustified privileges
that might compromise their independence.
2.1.5. The supervisory board should oversee that the company’s tax
planning strategies are designed and implemented in accordance with
the legal acts in order to avoid faulty practice that is not related to the
long-term interests of the company and its shareholders, which may
give rise to reputational, legal or other risks.
2.1.6. The company should ensure that the supervisory board is
provided with sufficient resources (including financial ones) to
discharge their duties, including the right to obtain all the necessary
information or to seek independent professional advice from external
legal, accounting or other experts on matters pertaining to the
competence of the supervisory board and its committees.
2.2. Formation of the supervisory board
The procedure of the formation of the supervisory board should ensure proper resolution of conflicts of interest and
effective and fair corporate governance.
2.2.1.The members of the supervisory board elected by the general
meeting of shareholders should collectively ensure the diversity of
qualifications, professional experience and competences and seek
for gender equality. With a view to maintain a proper balance
between the qualifications of the members of the supervisory board,
it should be ensured that members of the supervisory board, as a
whole, should have diverse knowledge, opinions and experience to
duly perform their tasks.
NOT
APPLICABLE
Due to its size, it is not
expedient to form the
Supervisory Board.
Considering that only collegial
management body - the Board
is formed in the Company. It
performs all essential
management functions and
ensures accountability and
control of CEO of the
Company.
2.2.2.Members of the supervisory board should be appointed for a
specific term, subject to individual re-election for a new term in office
in order to ensure necessary development of professional
experience.
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2.2.3.Chair of the supervisory board should be a person whose current
or past positions constituted no obstacle to carry out impartial
activities. A former manager or management board member of the
company should not be immediately appointed as chair of the
supervisory board either. Where the company decides to depart
from these recommendations, it should provide information on the
measures taken to ensure impartiality of the supervision.
2.2.4.Each member should devote sufficient time and attention to
perform his duties as a member of the supervisory board. Each
member of the supervisory board should undertake to limit his other
professional obligations (particularly the managing positions in
other companies) so that they would not interfere with the proper
performance of the duties of a member of the supervisory board.
Should a member of the supervisory board attend less than a half
of the meetings of the supervisory board throughout the financial
year of the company, the shareholders of the company should be
notified thereof.
2.2.5.When it is proposed to appoint a member of the supervisory
board, it should be announced which members of the supervisory
board are deemed to be independent. The supervisory board may
decide that, despite the fact that a particular member meets all the
criteria of independence, he/she cannot be considered
independent due to special personal or company-related
circumstances.
2.2.6.The amount of remuneration to members of the supervisory
board for their activity and participation in meetings of the
supervisory board should be approved by the general meeting of
shareholders.
2.2.7.Every year the supervisory board should carry out an
assessment of its activities. It should include evaluation of the
structure of the supervisory board, its work organization and ability
to act as a group, evaluation of the competence and work efficiency
of each member of the supervisory board, and evaluation whether
the supervisory board has achieved its objectives. The supervisory
board should, at least once a year, make public respective
information about its internal structure and working procedures.
Principle 3: Management Board
3.1. Functions and liability of the management board
The management board should ensure the implementation of the company’s strategy and good corporate governance
with due regard to the interests of its shareholders, employees and other interest groups.
3.1.1. The management board should ensure the implementation of
the company’s strategy approved by the supervisory board if the latter
has been formed at the company. In such cases where the supervisory
board is not formed, the management board is also responsible for the
approval of the company’s strategy.
YES/NO
The strategy of the company
has not been approved by the
Board, but the Board has set
the company's business
objectives, which are disclosed
in the annual and semi-annual
reports, reports on significant
events.
3.1.2. As a collegial management body of the company, the
management board performs the functions assigned to it by the Law
and in the articles of association of the company, and in such cases
where the supervisory board is not formed in the company, it performs
inter alia the supervisory functions established in the Law. By
performing the functions assigned to it, the management board should
take into account the needs of the company’s shareholders, employees
and other interest groups by respectively striving to achieve
sustainable business development.
YES/NO
The Board's functions are
discussed in the Consolidated
Annual Management Report
12.2. section.
3.1.3. The management board should ensure compliance with the laws
and the internal policy of the company applicable to the company or a
group of companies to which this company belongs. It should also
establish the respective risk management and control measures aimed
at ensuring regular and direct liability of managers.
YES
The Board ensures that the
company complies with the
laws and the provisions of the
company's internal policy, and
in accordance with the
established internal
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7
Link to the OECD Good Practice Guidance on Internal Controls, Ethics and Compliance: https://www.oecd.org/daf/anti-
bribery/44884389.pdf
management and control
measures, also ensures the
accountability of the manager.
3.1.4. Moreover, the management board should ensure that the
measures included into the OECD Good Practice Guidance
7
on
Internal Controls, Ethics and Compliance are applied at the company
in order to ensure adherence to the applicable laws, rules and
standards.
YES/NO
The Board ensures compliance
with applicable laws, rules and
standards, however, the
company does not have written
procedures for internal control
or compliance.
3.1.5. When appointing the manager of the company, the management
board should take into account the appropriate balance between the
candidate’s qualifications, experience and competence.
YES
When appointing the head of
the Company, the Board shall
take into account the
appropriate qualification,
experience and competence of
the candidate.
3.2. Formation of the management board
3.2.1.The members of the management board elected by the
supervisory board or, if the supervisory board is not formed, by the
general meeting of shareholders should collectively ensure the
required diversity of qualifications, professional experience and
competences and seek for gender equality. With a view to maintain a
proper balance in terms of the current qualifications possessed by the
members of the management board, it should be ensured that the
members of the management board would have, as a whole, diverse
knowledge, opinions and experience to duly perform their tasks.
YES
The members of the Board of
the Company have the
necessary diverse knowledge,
opinions and experience to
perform their tasks properly.
3.2.2.Names and surnames of the candidates to become members of
the management board, information on their educational background,
qualifications, professional experience, current positions, other
important professional obligations and potential conflicts of interest
should be disclosed without violating the requirements of the legal acts
regulating the handling of personal data at the meeting of the
supervisory board in which the management board or individual
members of the management board are elected. In the event that the
supervisory board is not formed, the information specified in this
paragraph should be submitted to the general meeting of shareholders.
The management board should, on yearly basis, collect data provided
in this paragraph on its members and disclose it in the company’s
annual report.
YES
All information shall be
provided in accordance with
the requirements set out in this
point. Details of the members
of the Board are provided on
section 13 of this Annual
Report.
3.2.3.All new members of the management board should be
familiarized with their duties and the structure and operations of the
company.
YES
After the election, all members
of the Board are acquainted
with the duties, structure and
activities of the company.
3.2.4.Members of the management board should be appointed for a
specific term, subject to individual re-election for a new term in office
in order to ensure necessary development of professional experience
and sufficiently frequent reconfirmation of their status.
YES
According to the company's
Articles of Association, the
members of the Board are
elected for four years, without
limiting the number of their
terms. The company's Articles
of Association provide for the
possibility to re-elect the Board
or an individual member of the
Board.
3.2.5.Chair of the management board should be a person whose
current or past positions constitute no obstacle to carry out impartial
activity. Where the supervisory board is not formed, the former
manager of the company should not be immediately appointed as chair
of the management board. When a company decides to depart from
these recommendations, it should furnish information on the measures
it has taken to ensure the impartiality of supervision.
YES
The chairman of the board is a
person who has never been the
head of the company and acts
impartially.
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8
For the purposes of this Code, the criteria of independence of the members of the board are interpreted as the criteria of unrelated persons
defined in Article 33(7) of the Law on Companies of the Republic of Lithuania.
3.2.6. Each member the management board should give sufficient
time and attention to perform the duties of a member of the Board. If a
member of the management Board participated in less than half of the
board meetings during the financial year of the Company, the
Company's Supervisory Board should be informed if the Supervisory
Board is not formed in the Company - the General Shareholder
Meeting.
YES
The members of the Board of
the company devote sufficient
time and attention to their
duties. Board members actively
participated in all meetings.
3.2.7. In the event that the management board is elected in the cases
established by the Law where the supervisory board is not formed at
the company, and some of its members will be independent
8
, it should
be announced which members of the management board are deemed
as independent. The management board may decide that, despite the
fact that a particular member meets all the criteria of independence
established by the Law, he/she cannot be considered independent due
to special personal or company-related circumstances.
NO
No evaluation of the
independence of the Board
members has been carried out,
but the election of the Board of
the Company for a new 4-year
term must take place at the
Ordinary General Meeting of
Shareholders in 2022, so some
members will be independent
as required by law.
3.2.8. The general meeting of shareholders of the company should
approve the amount of remuneration to the members of the
management board for their activity and participation in the meetings
of the management board.
NOT
APPLICABLE
No remuneration is paid to the
members of the Board for their
activity in the management
board.
3.2.9.The members of the management board should act in good faith,
with care and responsibility for the benefit and the interests of the
company and its shareholders with due regard to other stakeholders.
When adopting decisions, they should not act in their personal interest;
they should be subject to no-compete agreements and they should not
use the business information or opportunities related to the company’s
operations in violation of the company’s interests.
YES
The members of the Board act
in good faith towards the
company, follow the interests of
the company and not their own
or third parties, the principles of
honesty, reasonableness,
respect for confidentiality,
sense of responsibility, thereby
trying to maintain their
independence in decision-
making.
3.2.10. Every year the management board should carry out an
assessment of its activities. It should include evaluation of the structure
of the management board, its work organization and ability to act as a
group, evaluation of the competence and work efficiency of each
member of the management board, and evaluation whether the
management board has achieved its objectives. The management
board should, at least once a year, make public respective information
about its internal structure and working procedures in observance of
the legal acts regulating the processing of personal data.
YES
Once a year, the Board
evaluates its activities, which
includes an assessment of the
board's structure, operational
independence, and ability to
work in a team.
The structure of the Board is
published by the company in
annual reports and on the
website.
Principle 4: Rules of procedure of the supervisory board and the management board of the company
The rules of procedure of the supervisory board, if it is formed at the company, and of the management board should
ensure efficient operation and decision-making of these bodies and promote active cooperation between the company’s
management bodies.
4.1. The management board and the supervisory board, if the latter is
formed at the company, should act in close cooperation in order to
attain benefit for the company and its shareholders. Good corporate
governance requires an open discussion between the management
board and the supervisory board. The management board should
regularly and, where necessary, immediately inform the supervisory
board about any matters significant for the company that are related to
planning, business development, risk management and control, and
compliance with the obligations at the company. The management
board should inform he supervisory board about any derogations in its
business development from the previously formulated plans and
objectives by specifying the reasons for this.
YES/NO
The Supervisory Board is not
formed. Nevertheless, the
Board and the CEO acts in
close cooperation seeking to
obtain the maximum benefit for
the Company and its
shareholders.
4.2. It is recommended that meetings of the company’s collegial bodies
should be held at the respective intervals, according to the pre-
approved schedule. Each company is free to decide how often
meetings of the collegial bodies should be convened but it is
recommended that these meetings should be convened at such
intervals that uninterruptable resolution of essential corporate
YES
Board meetings are held at
least once a quarter.
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9
The legal acts may provide for the obligation to form a respective committee. For example, the Law on the Audit of Financial Statements
of the Republic of Lithuania provides that public-interest entities (including but not limited to public limited liability companies whose securities
are traded on a regulated market of the Republic of Lithuania and/or of any other Member State) are under the obligation to set up an audit
committee (the legal acts provide for the exemptions where the functions of the audit committee may be carried out by the collegial body
performing the supervisory functions).
governance issues would be ensured. Meetings of the company’s
collegial bodies should be convened at least once per quarter.
4.3. Members of a collegial body should be notified of the meeting
being convened in advance so that they would have sufficient time for
proper preparation for the issues to be considered at the meeting and
a fruitful discussion could be held and appropriate decisions could be
adopted. Along with the notice of the meeting being convened all
materials relevant to the issues on the agenda of the meeting should
be submitted to the members of the collegial body. The agenda of the
meeting should not be changed or supplemented during the meeting,
unless all members of the collegial body present at the meeting agree
with such change or supplement to the agenda, or certain issues that
are important to the company require immediate resolution.
YES
Board meetings are convened
in advance, usually by e-mail.
The material shall be submitted
at least one working day before
the meeting of the Board so
that the members can prepare
properly.
4.4. In order to coordinate the activities of the company’s collegial
bodies and ensure effective decision-making process, the chairs of the
company’s collegial supervision and management bodies should
mutually agree on the dates and agendas of the meetings and close
cooperate in resolving other matters related to corporate governance.
Meetings of the company’s supervisory board should be open to
members of the management board, particularly in such cases where
issues concerning the removal of the management board members,
their responsibility or remuneration are discussed.
NO
The company cannot
implement this
recommendation as it only has
a board.
Principle 5: Nomination, remuneration and audit committees
5.1. Purpose and formation of committees
The committees formed at the company should increase the work efficiency of the supervisory board or, where the
supervisory board is not formed, of the management board which performs the supervisory functions by ensuring that
decisions are based on due consideration and help organise its work in such a way that the decisions it takes would be
free of material conflicts of interest.
Committees should exercise independent judgment and integrity when performing their functions and provide the collegial
body with recommendations concerning the decisions of the collegial body. However, the final decision should be adopted
by the collegial body.
5.1.1. Taking due account of the company-related circumstances and
the chosen corporate governance structure, the supervisory board of
the company or, in cases where the supervisory board is not formed,
the management board which performs the supervisory functions,
establishes committees. It is recommended that the collegial body
should form the nomination, remuneration and audit committees
9
.
YES/NO
Due to the simplicity of the
company management
structure and the small number
of employees, the Nomination
and Remuneration Committees
are not formed.
Audit Committee members are
elected by the General
Shareholders Meeting.
5.1.2. Companies may decide to set up less than three committees. In
such case companies should explain in detail why they have chosen
the alternative approach, and how the chosen approach corresponds
with the objectives set for the three different committees.
5.1.3. In the cases established by the legal acts the functions assigned
to the committees formed at companies may be performed by the
collegial body itself. In such case the provisions of this Code pertaining
to the committees (particularly those related to their role, operation and
transparency) should apply, where relevant, to the collegial body as a
whole.
5.1.4. Committees established by the collegial body should normally
be composed of at least three members. Subject to the requirements
of the legal acts, committees could be comprised only of two members
as well. Members of each committee should be selected on the basis
of their competences by giving priority to independent members of the
collegial body. The chair of the management board should not serve
as the chair of committees.
5.1.5. The authority of each committee formed should be determined
by the collegial body itself. Committees should perform their duties
according to the authority delegated to them and regularly inform the
collegial body about their activities and performance on a regular basis.
The authority of each committee defining its role and specifying its
rights and duties should be made public at least once a year (as part
of the information disclosed by the company on its governance
structure and practice on an annual basis). In compliance with the legal
CONSOLIDATED ANNUAL REPORT FOR 2021 | 132
5.2. Nomination committee
5.2.1. The key functions of the nomination committee should be the
following:
1) to select candidates to fill vacancies in the membership of supervisory
and management bodies and the administration and recommend the
collegial body to approve them. The nomination committee should
evaluate the balance of skills, knowledge and experience in the
management body, prepare a description of the functions and capabilities
required to assume a particular position and assess the time commitment
expected;
2) assess, on a regular basis, the structure, size and composition of the
supervisory and management bodies as well as the skills, knowledge and
activity of its members, and provide the collegial body with
recommendations on how the required changes should be sought;
3) devote the attention necessary to ensure succession planning.
NOT
APPLICABL
E
Due to simplicity of the
Company’s management
structure and small number of
employees, it is not expedient
to form the Nomination and
Remuneration committees.
5.2.2. When dealing with issues related to members of the collegial body
who have employment relationships with the company and the heads of
the administration, the manager of the company should be consulted by
granting him/her the right to submit proposals to the Nomination
Committee.
5.3. Remuneration committee
The main functions of the remuneration committee should be as follows:
1) submit to the collegial body proposals on the remuneration policy
applied to members of the supervisory and management bodies and the
heads of the administration for approval. Such policy should include all
forms of remuneration, including the fixed-rate remuneration,
performance-based remuneration, financial incentive schemes, pension
arrangements and termination payments as well as conditions which
would allow the company to recover the amounts or suspend the
payments by specifying the circumstances under which it would be
expedient to do so;
2) submit to the collegial body proposals regarding individual
remuneration for members of the collegial bodies and the heads of the
administration in order to ensure that they would be consistent with the
company’s remuneration policy and the evaluation of the performance of
the persons concerned;
3) review, on a regular basis, the remuneration policy and its
implementation.
NOT
APPLICABL
E
Due to simplicity of the
Company’s management
structure and small number of
employees, it is not expedient
to form the Nomination and
Remuneration committees.
5.4.Audit committee
acts regulating the processing of personal data, companies should also
include in their annual reports the statements of the existing
committees on their composition, the number of meetings and
attendance over the year as well as the main directions of their
activities and performance.
5.1.6. With a view to ensure the independence and impartiality of the
committees, the members of the collegial body who are not members
of the committees should normally have a right to participate in the
meetings of the committee only if invited by the committee. A
committee may invite or request that certain employees of the
company or experts would participate in the meeting. Chair of each
committee should have the possibility to maintain direct
communication with the shareholders. Cases where such practice is to
be applied should be specified in the rules regulating the activities of
the committee.
CONSOLIDATED ANNUAL REPORT FOR 2021 | 133
5.4.1.The key functions of the audit committee are defined in the legal
acts regulating the activities of the audit committee
10
.
YES
In its activities, the Audit
Committee of the company
follows the legal acts
regulating the activities of the
Audit Committee, as well as
the regulations of the Audit
Committee approved by the
General Meeting of
Shareholders of the
company.
5.4.2.All members of the committee should be provided with detailed
information on specific issues of the company’s accounting system,
finances and operations. The heads of the company’s administration
should inform the audit committee about the methods of accounting for
significant and unusual transactions where the accounting may be
subject to different approaches.
YES
The members of the
Committee shall be provided
with all the detailed
information necessary for the
performance of the
Committee's functions.
5.4.3.The audit committee should decide whether the participation of the
chair of the management board, the manager of the company, the chief
finance officer (or senior employees responsible for finance and
accounting), the internal and external auditors in its meetings is required
(and, if required, when). The committee should be entitled, when needed,
to meet the relevant persons without members of the management
bodies present.
YES
The members of the Audit
Committee have the
opportunity to meet with the
desired persons in the
absence of the members of
the management bodies.
5.4.4.The audit committee should be informed about the internal auditor’s
work program and should be furnished with internal audit reports or
periodic summaries. The audit committee should also be informed about
the work program of external auditors and should receive from the audit
firm a report describing all relationships between the independent audit
firm and the company and its group.
NOT
APPLICABLE
Due to the size of the
Company, the Company
does not have an internal
audit function
5.4.5.The audit committee should examine whether the company
complies with the applicable provisions regulating the possibility of
lodging a complaint or reporting anonymously his/her suspicions of
potential violations committed at the company and should also ensure
that there is a procedure in place for proportionate and independent
investigation of such issues and appropriate follow-up actions.
NO
The Audit Committee does
not review the provisions of
this paragraph, as the
company's small size does
not allow employees to file a
complaint or report
suspicions anonymously.
5.4.6.The audit committee should submit to the supervisory board or,
where the supervisory board is not formed, to the management board its
activity report at least once in every six months, at the time that annual
and half-yearly reports are approved.
NO
The activity report is
submitted once a year for the
annual ordinary shareholders
meeting
Principle 6: Prevention and disclosure of conflicts of interest
The corporate governance framework should encourage members of the company’s supervisory and management bodies
to avoid conflicts of interest and ensure a transparent and effective mechanism of disclosure of conflicts of interest related
to members of the supervisory and management bodies.
Any member of the company’s supervisory and management body
should avoid a situation where his/her personal interests are or may be
in conflict with the company’s interests. In case such a situation did occur,
a member of the company’s supervisory or management body should,
within a reasonable period of time, notify other members of the same
body or the body of the company which elected him/her or the company’s
shareholders of such situation of a conflict of interest, indicate the nature
of interests and, where possible, their value.
YES
Board members avoid
situations where their
personal interests may
conflict with the interests of
the company.
Principle 7: Remuneration policy of the company
The remuneration policy and the procedure for review and disclosure of such policy established at the company should
prevent potential conflicts of interest and abuse in determining remuneration of members of the collegial bodies and heads
of the administration, in addition it should ensure the publicity and transparency of the company’s remuneration policy
and its long-term strategy.
10
Issues related to the activities of audit committees are regulated by Regulation No. 537/2014 of the European Parliament and the Council
of 16 April 2014 on specific requirements regarding statutory audit of public-interest entities, the Law on the Audit of Financial Statements
of the Republic of Lithuania, and the Rules Regulating the Activities of Audit Committees approved by the Bank of Lithuania.
CONSOLIDATED ANNUAL REPORT FOR 2021 | 134
7.1. The company should approve and post the remuneration policy on
the website of the company; such policy should be reviewed on a regular
basis and be consistent with the company’s long-term strategy.
YES
The remuneration policy is
published on the company's
website. Its review will take
place in accordance with the
requirements established by
law.
7.2. The remuneration policy should include all forms of remuneration,
including the fixed-rate remuneration, performance-based remuneration,
financial incentive schemes, pension arrangements and termination
payments as well as the conditions specifying the cases where the
company can recover the disbursed amounts or suspend the payments.
YES / NO
The CEO of the company
receives only a fixed salary.
7.3. With a view to avoid potential conflicts of interest, the remuneration
policy should provide that members of the collegial bodies which perform
the supervisory functions should not receive remuneration based on the
company’s performance.
YES
The members of the
company's board do not
receive remuneration that
would depend on the
company's performance.
7.4. The remuneration policy should provide sufficient information on the
policy regarding termination payments. Termination payments should not
exceed a fixed amount or a fixed number of annual wages and in general
should not be higher than the non-variable component of remuneration
for two years or the equivalent thereof. Termination payments should not
be paid if the contract is terminated due to inadequate performance.
NOT
APPLICABLE
The company's
Remuneration Policy does
not provide information
regarding termination
payments. The Company
follows the legal acts
requirements regarding
termination payments.
7.5. In the event that the financial incentive scheme is applied at the
company, the remuneration policy should contain sufficient information
about the retention of shares after the award thereof. Where
remuneration is based on the award of shares, shares should not be
vested at least for three years after the award thereof. After vesting,
members of the collegial bodies and heads of the administration should
retain a certain number of shares until the end of their term in office,
subject to the need to compensate for any costs related to the acquisition
of shares.
NO
Stock options may be granted
in the company, but the
Remuneration Policy does
not contain very detailed
information on the retention
of shares after the grant of
rights. Share options may be
granted in accordance with
the rules for granting Shares,
which are published on the
company's website, not in
accordance with the
provisions of the
Remuneration Policy.
Contracts for the acquisition
of shares decided to be
offered to employees by the
decision of the company's
general meeting of
shareholders shall be
concluded and the
employees shall acquire the
ownership right to the shares
not earlier than in the third
financial year
(excluding the financial year
in which the resolution of the
general meeting of
shareholders of the company
was adopted).
7.6. The company should publish information about the implementation
of the remuneration policy on its website, with a key focus on the
remuneration policy in respect of the collegial bodies and managers in
the next and, where relevant, subsequent financial years. It should also
contain a review of how the remuneration policy was implemented during
the previous financial year. The information of such nature should not
include any details having a commercial value. Particular attention should
be paid on the major changes in the company’s remuneration policy,
compared to the previous financial year.
YES
The Remuneration Policy is
published on the company's
website.
The company prepares and
presents a remuneration
report to the Ordinary
General Meeting of
Shareholders, which . which
is an integral part of the
annual report published on
the website
CONSOLIDATED ANNUAL REPORT FOR 2021 | 135
7.7. It is recommended that the remuneration policy or any major change
of the policy should be included on the agenda of the general meeting of
shareholders. The schemes under which members and employees of a
collegial body receive remuneration in shares or share options should be
approved by the general meeting of shareholders.
YES
The company's
Remuneration Policy and its
amendments are approved
by the General Meeting of
Shareholders. The rules for
granting the company's
Shares are also approved by
the General Meeting of
Shareholders.
Principle 8: Role of stakeholders in corporate governance
The corporate governance framework should recognize the rights of stakeholders entrenched in the laws or mutual
agreements and encourage active cooperation between companies and stakeholders in creating the company value, jobs
and financial sustainability. In the context of this principle the concept “stakeholders” includes investors, employees,
creditors, suppliers, clients, local community and other persons having certain interests in the company concerned.
8.1. The corporate governance framework should ensure that the rights
and lawful interests of stakeholders are protected.
YES
The company respects the
rights of stakeholders and
their legitimate interests.
8.2. The corporate governance framework should create conditions for
stakeholders to participate in corporate governance in the manner
prescribed by law. Examples of participation by stakeholders in corporate
governance include the participation of employees or their
representatives in the adoption of decisions that are important for the
company, consultations with employees or their representatives on
corporate governance and other important matters, participation of
employees in the company’s authorized capital, involvement of creditors
in corporate governance in the cases of the company’s insolvency, etc.
YES
All stakeholders have the
opportunity to participate in
the management of the
company in accordance with
the procedure established by
law.
8.3. Where stakeholders participate in the corporate governance
process, they should have access to relevant information.
YES
Stakeholders participating in
the management process of
the company are provided
with access to non-
confidential information, as
long as it does not infringe the
interests of the company and
other related persons.
8.4. Stakeholders should be provided with the possibility of reporting
confidentially any illegal or unethical practices to the collegial body
performing the supervisory function.
NO
The Company does not
provide possibility of
reporting confidentially any
illegal or unethical practices
Principle 9: Disclosure of information
The corporate governance framework should ensure the timely and accurate disclosure of all material corporate issues,
including the financial situation, operations and governance of the company.
9.1. In accordance with the company’s procedure on confidential
information and commercial secrets and the legal acts regulating the
processing of personal data, the information publicly disclosed by the
company should include but not be limited to the following:
YES
The below mentioned
information is disclosed in
notices of material events
published through the
information disclosure
system of the Nasdaq Vilnius
Stock Exchange, on the
company's website, in the
company's annual and semi-
annual information
documents to the extent
required by law and
International Financial
Reporting Standards in the
European Union.
9.1.1. operating and financial results of the company;
YES
Disclosed in annual and
semi-annual information.
9.1.2. objectives and non-financial information of the company;
YES
Disclosed in annual
information.
9.1.3. persons holding a stake in the company or controlling it directly
and/or indirectly and/or together with related persons as well as the
structure of the group of companies and their relationships by specifying
the final beneficiary;
YES
Disclosed in annual and
semi-annual information and
on the company's website.
CONSOLIDATED ANNUAL REPORT FOR 2021 | 136
9.1.4. members of the company’s supervisory and management bodies
who are deemed independent, the manager of the company, the shares
or votes held by them at the company, participation in corporate
governance of other companies, their competence and remuneration;
YES
Disclosed in annual and
semi-annual information and
on the company's website.
9.1.5. reports of the existing committees on their composition, number of
meetings and attendance of members during the last year as well as the
main directions and results of their activities;
NOT
APPLICABLE
The report of the Audit
Committee is made public.
There are no more
committees in the company
9.1.6. potential key risk factors, the company’s risk management and
supervision policy;
YES
Disclosed in annual
information.
9.1.7. the company’s transactions with related parties;
YES
Disclosed in the annual
information and on the
company's website.
9.1.8. main issues related to employees and other stakeholders (for
instance, human resource policy, participation of employees in corporate
governance, award of the company’s shares or share options as
incentives, relationships with creditors, suppliers, local community, etc.);
YES
Information on promotion
through stock options is
disclosed in the annual
information and on the
company's website.
9.1.9. structure and strategy of corporate governance;
YES
Disclosed in annual and
semi-annual information.
9.1.10. initiatives and measures of social responsibility policy and anti-
corruption fight, significant current or planned investment projects.
This list is deemed minimum and companies are encouraged not to
restrict themselves to the disclosure of information included into this list.
This principle of the Code does not exempt companies from their
obligation to disclose information as provided for in the applicable legal
acts.
NO
Due to the size of the
Company, information
related to the environment,
employees and social
responsibility policy is not
published
9.2. When disclosing the information specified in paragraph 9.1.1 of
recommendation 9.1, it is recommended that the company which is a
parent company in respect of other companies should disclose
information about the consolidated results of the whole group of
companies.
YES
The company prepares the
consolidated report and the
consolidated financial
statements
9.3. When disclosing the information specified in paragraph 9.1.4 of
recommendation 9.1, it is recommended that the information on the
professional experience and qualifications of members of the company’s
supervisory and management bodies and the manager of the company
as well as potential conflicts of interest which could affect their decisions
should be provided. It is further recommended that the remuneration or
other income of members of the company’s supervisory and
management bodies and the manager of the company should be
disclosed, as provided for in greater detail in Principle 7.
YES
Disclosed in annual and
semi-annual information.
9.4. Information should be disclosed in such manner that no shareholders
or investors are discriminated in terms of the method of receipt and scope
of information. Information should be disclosed to all parties concerned
at the same time.
YES
The company publishes all
information through the
information disclosure
system of the Nasdaq Vilnius
Stock Exchange and on the
company's website so that it
is accessible to everyone and
at the same time.
Principle 10: Selection of the company’s audit firm
The company’s audit firm selection mechanism should ensure the independence of the report and opinion of the audit
firm.
10.1. With a view to obtain an objective opinion on the company’s
financial condition and financial results, the company’s annual financial
statements and the financial information provided in its annual report
should be audited by an independent audit firm.
YES
The company is audited by
an independent audit
company.
10.2. It is recommended that the audit firm would be proposed to the
general meeting of shareholders by the supervisory board or, if the
supervisory board is not formed at the company, by the management
board of the company.
YES
The Board of the company
nominates the audit company
to the shareholders' meeting.
CONSOLIDATED ANNUAL REPORT FOR 2021 | 137
10.3. In the event that the audit firm has received remuneration from the
company for the non-audit services provided, the company should
disclose this publicly. This information should also be available to the
supervisory board or, if the supervisory board is not formed at the
company, by the management board of the company when considering
which audit firm should be proposed to the general meeting of
shareholders.
YES
2021 the audit firm did not
provide non audit services
CONSOLIDATED ANNUAL REPORT FOR 2021 | 138
APPENDIX 3. COMPANY'S MANAGEMENT REPORT
(Prepared in accordance with the Law of the Republic of Lithuania on Financial Reporting by Undertakings)
1. Reference to the applicable corporate governance code and the place of its publication, and (or) reference to the
all necessary published information regarding management practices of the entity
The Company discloses the information regarding the compliance with the applicable Corporate Governance Code in
Appendix 2 of the consolidated annual report for 2021. The Company publishes its annual reports on it‘s website.
2. In case of derogation from the provisions of the applicable corporate governance code and (or) when the
provisions are not complied with, such provisions and the reasons thereof shall be indicated
The Company discloses such information in sections “Yes/No/Irrelevant” and “Commentary” of Appendix 2 of the
consolidated annual report for 2021 “Information regarding the compliance with Corporate Governance Code. The Company,
taking into account the recommendations of the Bank of Lithuania, provides an explanation in the “Comment” section in all
cases, even if it fully complies with the principle / recommendation.
3. Information regarding the level of risk and risk management – management of risks related to the financial
reporting, risk mitigation measures, and internal control systems implemented at the entity shall be described
The Company provides information regarding the level of risk, risk management, and implemented internal control systems,
as well as the measures, in Clause 18 of the consolidated annual report for 2021.
4. Information regarding significant directly or indirectly managed holdings
The Company provides information regarding the significant directly or indirectly managed holdings in Note 1 of the financial
statements of 2021.
5. Information about related parties transactions in accordance with Article 37
2
of the Law on Companies of the
Republic of Lithuania
Information on transactions concluded by the Company with related parties, as provided for in Article 37
2
of the Law on
Companies, is published on the Company's website , “Investor Relations” section.
Pursuant to the provisions of Item 10 of Article 37
2
of the Law on Companies of the Republic of Lithuania, the amounts of
the Company's transactions with related parties concluded in the ordinary course of business and concluded with the same
related party during the financial year are presented in Item 21 of this Annual Management Report.
We provide information on the company's related party transactions in 2021 published on the company's website
Please note that the determination of whether a company is related to an issuer is not based on the Law on
Securities but on International Accounting Standard (IAS) 24 Related Party Disclosures.
Related party
Company’s
relationship with the
other counterparty
Date and value of the transaction
Other information
UAB Kelio ženklai
code 185274242,
Geležinkelio str. 28, Pilviškiai,
Vilkaviškis district
Register of Legal Entities
100% controlled by
Invalda INVL
Loan granted. 31.12.2020 Loan
agreement No. . P/201231/01, the
loan amount is EUR 296,669.59.
The shares of UAB Kelio
ženklai were sold.
The loan was repaid on
27.05.2021, offsetting it as
part of the granting of a new
loan to third parties under
the terms of the sale of
shares.
UAB Cedus invest
code 302576631,
Gynėjų str. 14, Vilnius
Register of Legal Entities
100% controlled by
Invalda INVL
On 7 January 2021, a share
purchase and sale agreement was
concluded regarding the sale of
2,060,000 shares of SUTNTIB
INVL Baltic Real Estate for the total
price of EUR 4,553,218. The
selling price per share has been
set as the last publicly announced,
i.e. as of 30.11.2020, the net asset
CONSOLIDATED ANNUAL REPORT FOR 2021 | 139
value per share equal to EUR
2.2103.
UAB Kelio ženklai
code 185274242,
Geležinkelio str. 28, Pilviškiai,
Vilkaviškis district
Register of Legal Entities
100% controlled by
Invalda INVL
Loan granted. 24.02.2021 Loan
agreement No. P / 210224/01, the
loan amount is EUR 15,000.
The shares of UAB Kelio
ženklai were sold.
The loan was repaid on
27.05.2021, offsetting it as
part of the granting of a new
loan to third parties under
the terms of the sale of
shares.
UAB Kelio ženklai
code 185274242,
Geležinkelio str. 28, Pilviškiai,
Vilkaviškis district
Register of Legal Entities
100% controlled by
Invalda INVL
Loan granted. 16.03.2021 Loan
agreement No. P / 210316/01, the
loan amount is EUR 40,000.
The shares of UAB Kelio
ženklai were sold.
The loan was repaid on
27.05.2021, offsetting it as
part of the granting of a new
loan to third parties under
the terms of the sale of
shares.
SUTNTIB INVL Baltic Real
Estate
code 152105644,
Gynėjų str. 14, Vilnius
Register of Legal Entities
Invalda INVL owned
more than 30% of
shares
AB Cedus Invest, a company
100% controlled by Invalda INVL,
sold 2,060,000 shares in SUTNTIB
INVL Baltic Real Estate during the
redemption process on the Nasdaq
auction market for EUR 4,553,218.
The order was submitted on 25
March 2021.
SUTNTIB INVL Baltic Real
Estate
code 152105644,
Gynėjų str. 14, Vilnius
Register of Legal Entities
Invalda INVL owned
more than 30% of
shares
UAB Įmonių grupė Inservis, a
company 100% controlled by
Invalda INVL, sold 323,000 shares
in SUTNTIB INVL Baltic Real
Estate during the redemption
process on the NASDAQ auction
market for EUR 713,926.90. The
order was submitted on 25 March
2021.
UAB FMĮ INVL Finasta
code 304049332,
Gynėjų str. 14, Vilnius
Register of Legal Entities
100% controlled by
Invalda INVL
28.06.2021 wealth management
services agreement No.1646
concluded
UAB FMĮ INVL Finasta
code 304049332,
Gynėjų str. 14, Vilnius
Register of Legal Entities
100% controlled by
Invalda INVL
28.06.2021 electronic services
Agreement No. E1646 concluded.
UAB INVL Life
code 305859887
Gynėjų str. 14, Vilnius
Register of Legal Entities
100% controlled by
Invalda INVL
09-08-2021 deed of incorporation,
EUR 3,700,000.
UAB „Aktyvo“
code 301206846, Gynėjų str.
14, Vilnius
Register of Legal Entities
Invalda INVL owned
54.55% of shares
A loan of EUR 27,276.01, which
was granted on 10.07.2020, was
repaid on 20.08.2021. The loan
was repaid offsetting the funds
received from UAB Activo after the
reduction of the authorized capital.
UAB Proprietas
code 303252098, Gynėjų str.
14, Vilnius
Register of Legal Entities
Invalda INVL
indirectly owned
23.43% of shares
02.08.2021 an agreement was
signed on increasing the price of
accounting services to 1,300
Eur/month excluding VAT.
SUTNTIB INVL Baltic Real
Estate
code 152105644,
Gynėjų str. 14, Vilnius
Register of Legal Entities
Invalda INVL owned
23.43% of shares.
02.08.2021 an agreement was
signed on increasing the price of
accounting services to 1,750
Eur/month excluding VAT.
UAB „Cedus Invest“,
code 302576631,
Gynėjų str. 14, Vilnius
Register of Legal Entities
100% controlled by
Invalda INVL
01.09.2021 an agreement was
signed on increasing the price of
accounting services to 200
Eur/month excluding VAT.
CONSOLIDATED ANNUAL REPORT FOR 2021 | 140
UAB Įmonių grupė „Inservis“
code 301673796,
Gynėjų str. 14, Vilnius
Register of Legal Entities
100% controlled by
Invalda INVL
01.09.2021 an agreement was
signed on increasing the price of
accounting services to 200
Eur/month excluding VAT.
UAB „INVL Farmland
Management“
code 303788352, Gynėjų str.
14, Vilnius
Register of Legal Entities
100% controlled by
Invalda INVL
01.09.2021 an agreement was
signed on increasing the price of
accounting services to 550
Eur/month excluding VAT.
UAB MD Partners
code 304842899, Gynėjų str.
14, Vilnius
Register of Legal Entities
Invalda INVL owned
51.37% of shares
01.09.2021 an agreement was
signed on increasing the price of
accounting services to 200
Eur/month excluding VAT.
AB „INVL Baltic Farmland“
code 303299781, Gynėjų str.
14, Vilnius
Register of Legal Entities
The shareholders
who jointly control
AB Invalda INVL in
accordance with the
shareholders'
agreement,
pursuant to IAS 24,
are considered to
have significant
influence over the
related party and are
part of its board.
01.09.2021 an agreement was
signed on increasing the price of
accounting services to EUR
300/month without VAT; up to
EUR 600 excluding VAT for
quarterly sets of financial
statements and up to EUR 2000
for annual sets of audited financial
statements.
UAB Avižėlė
code 303113077;
UAB Beržytė
code 30112915;
UAB Dirvolika
code 303112954;
UAB Duonis
code 303112790;
UAB Ekotra
code 303112623;
UAB Kvietukas
code 303112687;
UAB Laukaitis
code 303112694;
UAB Lauknešys
code 303112655;
UAB Linažiedė
code 303112922;
UAB Pušaitis
code 303113102;
UAB Puškaitis
code 303112769;
UAB Sėja
code 303113013;
UAB Vasarojus
code 303112776;
UAB Žemgalė
code 303112744;
UAB Žemynėlė
code 303112559;
UAB Žiemkentys
code 303112648;
UAB Žalvė
code 303113045
Gynėjų str. 14, Vilnius
Register of Legal Entities
The shareholders
who jointly control
AB Invalda INVL in
accordance with the
shareholders'
agreement,
pursuant to IAS 24,
are considered to
have significant
influence over the
related party and are
part of its board.
01.09.2021 an agreement was
signed on increasing the price of
accounting services to 300
Eur/month excluding VAT.
IPAS INVL Asset Management
code 40003605043,
Elizabetes iela 10B-1, Ryga,
Latvija
Commercial register of Latvia
100% controlled by
INVL Asset
Management, a
100% subsidiary of
Invalda INVL
28.10.2021 the increase of the
authorized capital by EUR
1,000,000 was registered by the
decision of the sole shareholder.
UAB „Litagra“
code 304564478,
Savanorių per. 173, Vilnius
Invalda INVL
indirectly owned
48.81% of shares
Loan granted. 13.12.2021 Loan
agreement, loan amount
EUR 2,234,000.
The loan was repaid on
13.01.2022
CONSOLIDATED ANNUAL REPORT FOR 2021 | 141
Register of Legal Entities
UAB „INVL Life“
code 305859887
Gynėjų str. 14, Vilnius
Register of Legal Entities
100% controlled by
Invalda INVL
20.12.2021 Share subscription
agreement. The authorized capital
was increased by EUR 3,800,000.
The increase was registered on
29.12.2021.
UAB „INVL Life“
code 305859887
Gynėjų g. 14, Vilnius
Register of Legal Entities
100% controlled by
Invalda INVL
327,160 shares of Šiaulių bankas
owned by Invalda INVL were sold
for EUR 248,641.60 on
29.12.2021
6. Information regarding the shareholders who have special rights of control and the description of such right
There are no shareholders having special rights of control in the Company.
7. Information regarding all current restrictions on voting rights (such as the restrictions on voting rights of persons
having a certain percentage or number of the votes, the deadlines by which voting rights may be exercised or systems,
according to which the property rights granted by the securities are to be separated from the holder of those securities)
No restrictions on voting rights are applied in the Company.
8. Information regarding the rules governing the appointment and dismissal of board members, as well as the
amendment of the company’s articles of association
The Board members of the Company act in accordance with the Law on Companies of the Republic of Lithuania, Articles of
Association of the Company, Rules of Procedure of the Board, as well as other applicable legislation. The Board members
of the Company always act for the benefit of the Company and its shareholders. The procedure for changing the Articles of
Association is no different from stated in the Law on Companies of the Republic of Lithuania.
9. Information regarding the powers of the board members
The Board members of the Company act in accordance with the Law on Companies of the Republic of Lithuania, Articles of
Association of the Company, Rules of Procedure of the Board, as well as other applicable legislation, and have no special
powers. The Board members of the Company always act for the benefit of the Company and its shareholders. More
information is disclosed in the Clause 12.2. of the Section IV of the consolidated annual report for 2021.
10. Information regarding the competence of the General Shareholders Meeting, the rights of shareholders and
implementation thereof, if such information is not established in the applicable legislation
The company provides information regarding the competence of the General Shareholders Meeting, the rights of
shareholders, and implementation thereof, as well as the procedure for convening such meetings, in Clause 12.1. of the
consolidated annual report of 2021.
11. Information regarding the composition of the management, supervisory bodies, and the committees thereof, as
well as the fields of activity of the aforesaid bodies and the manager of the company
The Company provides information about Members of the Board of the Company as well as the manager of the Company,
members of the Audit Committtee in Clause 13 of the consolidated annual report for 2021.
12. Description of diversity policy applicable in appointing the manager of the company, management, and
supervisory bodies, related to the aspects such as age, gender, education, professional experience; objectives of
such policy, methods of implementation thereof, and results of the reference period.
The Company organizes its activities in a way that employees, despite of their duties and the need to upgrade their
qualifications, are secure about equal working conditions, opportunities to develop competence, etc. Equally, the same
benefits are granted regardless of the gender, race, nationality, language, origin, social status, believes or convictions, age,
sexual orientation, disability, ethnicity, religion, marital status, intention of having children's or membership of the political
party or association. More information is disclosed in the Appendix 4 of the consolidated annual report for 2021.
13. Information about all agreements between shareholders (their essence, conditions).
Information is disclosed in Clause 9 of the consolidated annual report for 2021.
CONSOLIDATED ANNUAL REPORT FOR 2021 | 142
APPENDIX 4. REMUNERATION REPORT
The Company has prepared the first remuneration report (hereinafter - the Report). As this is the first Report, it does not
indicate how the results of the vote on the remuneration report of the General Meeting of Shareholders of the previous
reporting period were taken into account.
This report is designed to be read as a stand-alone document. The report has been prepared in accordance with the
provisions of the Law on Financial Reporting of Enterprises of the Republic of Lithuania and the Remuneration Policy
approved by the company's shareholders' meeting on 30 April 2020.
Introduction
Invalda INVL is an asset management group whose companies more than 260 thousand clients have entrusted over 1.6
billion euros of assets.
2021 was a very good year for investors with the Invalda INVL Group, during which our clients earned EUR 210.5 million. At
the end of 2021, Invalda INVL's equity was EUR 121.2 million or EUR 10.32 per share. Last year, Invalda INVL's net profit
amounted to EUR 37.5 million. The value of the assets of more than 260 thousand clients managed by the Group companies
in 2021 exceeded EUR 1.6 billion at the end of the year and increased by 29% over the year.
The main factor contributing to Invalda INVL’s results, as usual, was the change in the value of the investment portfolio and
income from the portfolio, from which our earnings in 2021 were EUR 33.5 million. Invalda INVL's income from the asset
management business in 2021 amounted to 15.8 million euros and earned 6.1 million euros. euros.
In 2020, the average number of employees of AB Invalda INVL was 7, of which 4 employees were assigned to the
management staff and the company also has 3 specialists.
Invalda INVL is a parent company whose operations are concentrated in subsidiaries, many of which are licensed and make
their information public.
Executive remuneration
The report provides information on the remuneration of the company's manager and each member of the bodies elected by
the shareholders' meeting. The head of the company is the President of Invalda INVL. The members of the bodies elected
by the shareholders' meeting are a) members of the Board, who may be paid bonuses and who may receive remuneration
from the company under employment, service or other contracts, b) members of the audit committee. Although not provided
for in the Remuneration Policy, given that the Company provides information on the remuneration of the Chief Financier in
the Annual Report, this information will also be disclosed in the Report.
The company's management did not change during the reporting period.
The members of the Board of the Company did not receive remuneration for their work on the Board but received
remuneration under employment contracts.
CONSOLIDATED ANNUAL REPORT FOR 2021 | 143
Table 1. Remuneration of the CEO, CFO and each member of the bodies elected by the specific shareholders' meeting for 2020 and 2021 (EUR, before taxes)
Name, position
Remuneration received from the group
In that number the
remuneration
received from any
company in which
Invalda INVL owns
more than 50% of
the shares
Fixed part of
remuneration
1
Variable part of
the remuneration
2
(for the year)
Variable part of
the remuneration
2
(long term
program)
Other monetary
reward
3
Other benefits
4
Total
Ratio of fixed to
variable and other
remuneration
2020
2021
2020
2021
2020
2021
2020
2021
2020
2021
2020
2021
2020
2021
2020
2021
Darius Šulnis,
CEO, Board
member
104,235
73,433
-
-
-
-
-
-
-
1,366
104,235
74,799
100%
98%
-
-
Alvydas Banys,
Senior Advisor,
Chairman of
the Board
73,554
73,429
-
-
-
-
-
-
-
-
73,554
73,429
100%
100%
-
-
Indrė Mišeikytė,
Advisor, Board
member
73,689
73,389
-
-
-
-
-
-
1,333
-
75,022
73,389
98%
100%
-
-
Tomas
Bubinas,
independent
audit
committee
member
906
508
-
-
-
-
-
-
-
-
906
508
100%
100%
-
-
Danguolė
Pranckėnienė,
independent
audit
committee
member
435
580
-
-
-
-
-
-
-
-
435
580
100%
100%
-
-
Raimondas
Rajeckas,
CFO
57,392
58,037
29,929
7,296
23,701
23,701
6,000
-
8,356
31,693
125,379
120,727
46%
48%
3,378
3,550
CONSOLIDATED ANNUAL REPORT FOR 2021 | 144
1. The fixed part of the remuneration is the monthly salary specified in the employment contract, i.e. basic part of wages.
Members of the elected bodies who have not concluded employment contracts with the company may receive remuneration
in the form prescribed by legal acts and under service contracts.
2. Variable part of the Remuneration - annual bonuses or share options. This is an additional employee remuneration,
which is granted and paid at the initiative of the company as a means of employee promotion and motivation. The value of
share options is disclosed as it is recognized in the financial statements in accordance with applicable accounting standards.
3. Other monetary reward - bonus, other benefits that may be paid for additional work, performance of additional functions
not provided for in their employment contract and / or job description, or performance of additional tasks.
4. Other benefits - other potential benefits provided to employees as incentives (for example, pension contributions may be
paid to employee’s pension funds managed by the group, reimbursement of part or all of the cost of training, gifts, taxes paid
on behalf of the employee, etc.).
Invalda INVL's remuneration policy maintains a simple and transparent remuneration structure and reduces the risk of
potential conflicts of interest. The Company believes that the publicly disclosed executive remuneration fully complies with
the provisions of the remuneration policy. The remuneration policy does not provide for the amounts of remuneration for
managers and the application of performance criteria.
Table 2. Annual changes in the company's results, remuneration disclosed in the report and average salary over 5
years
2017
2018
2019
2020
2021
Šulnis Darius
-0.2%
4.6%
2.1%
-24.3%
-29,6%
Mišeikytė Indrė
-0.5%
-0.3%
0.8%
1.9%
-2,2%
Banys Alvydas
0.2%
0.3%
-0.8%
0.5%
-0,2%
Rajeckas Raimondas
-12.8%
-3.0%
15.3%
28.9%
-3,7%
Tomas Bubinas
-11.1%
37.5%
150.9%
-54.7%
-44,0%
Dangutė Pranckėnienė
-75.8%
33,3%
Net profit
137.0%
-97.0%
5,972.0%
-74.4%
602,8%
Average salary
-41.9%
32.0%
29.8%
17.4%
31,8%
As required by law, the company provides comparisons of annual results and earnings. For the sake of comparability, when
calculating the changes, the remuneration for 2017-2018 has been recalculated by applying a coefficient of 1.289 due to the
reform of transferring employer taxes to the employee that took place in Lithuania from 1 January 2019. Also, the
remuneration that was not paid for a full year was converted to the full year equivalent.
As can be seen from the table, the company’s results do not directly affect the salaries of either management or other
employees. The results of Invalda INVL are determined by the successful activities of asset management companies, high
share prices in the securities market, realized sales transactions, etc. Wages are determined taking into account the general
market situation, the fulfilment of the employee's annual targets, and so on.
Share options
The decision on the specific number of shares of the company offered to employees and the method of granting shares (for
free and / or partially remunerated), when shares are granted partially remunerated - the share price payable by employees,
is decided by the general meeting of shareholders of at least 2/3 majority of the votes of all shareholders present at the
meeting. Agreements for the acquisition of shares decided by the General Meeting of Shareholders are concluded and
employees acquire ownership of shares not earlier than in the third financial year (excluding the financial year in which the
decision of the General Meeting of the Company was adopted), provided that such right has not been revoked for the
employee, the employee has not waived it or lost it on other grounds. The method of granting shares does not change
depending on the performance of the company and / or other group companies or the price of the company's ordinary
registered shares on the regulated market.
CONSOLIDATED ANNUAL REPORT FOR 2021 | 145
Table 3. Share options
Option
owners
the number of
securities in
2021 approved
by the
shareholders'
meeting for
options
Securities for which option agreements were
concluded in 2021
2021 exercised options (agreed in
2018)
number
agreed
purchase
price
year of
acquisition of
shares
Number of
securities
purchased
by
employees
Method of
granting of
securities
Employees
5
120,000
65,287
EUR 1
2024
59,674
Newly issued
shares have been
subscribed
5
Employee - any person who has a valid employment contract with a Group company on the day of the decision of the
Board of the Company to allocate Shares, as well as a member of the Supervisory Board and / or Board of the Group
company who is not a shareholder of the Company, owning 1/20 or more of the total votes of the Company.
Of the persons whose remuneration is disclosed in the remuneration report, stock options are granted only to the CFO of
the company, therefore the details of the stock options granted only to the CFO are given below.
Table 4. Unexercised stock options for the company's CFO
6
The exercise price of all share options of the company granted in the period from 2018 to 2019 will not exceed EUR 0.20
due to the payment of dividends of EUR 0.8 per share.
7
Value of exercised stock options is EUR 77,264. Share price on exercise date was EUR 9.50. Exercise price was EUR 0.2.
8
Amounts recognized in the financial statements in accordance with IFRS 2. For the current year, accruals are made at the
end of the year, regardless of the legal grant of share options, so only an adjustment to the value of the options granted is
recognized in the grant year. In the case of a long-term program, a value proportional to the period of operation is recognized
during the current year.
Name
Perfor-
mance
period,
years
Grant
date
Expiry
date
Exercise
price, EUR
6
Opening
balance
at 1
January
Share
options
granted
Share
options
exercised
7
Closing
balance
at 31
Decem-
ber
Value of
granted
share
option
Expenses
recogni-
zed in the
financial
state-
ments
8
Assigned
in 2018
2017
03.05.2018
2021
1
8,308
-
8,308
-
-
Assigned
in 2019
2018
06.05.2019
2022
1
9,086
-
-
9,086
-
-
Assigned
in 2020
2019
25.05.2020
2023
1
3,954
-
-
3,954
-
-
2020
long-term
program
2020-
2022
01.07.2020
/
31.12.2022
vesting
date
2023
Share
purchase
price will be
calculated,
as a starting
point taking
the net asset
value per
share of
Invalda INVL
as of
31.12.2019
(EUR 7.47),
additionally
calculating
12% annual
interest rate
and
estimating
the granted
share
payments, if
there are
any (EUR
0.8 till now)
116,105
-
-
116,105
-
23,701
Total
137,453
-
8,308
129,145
-
23,701