AB INVALDA INVL
Consolidated Annual Report,
Consolidated and Company’s Financial Statements for
the year ended 31 December 2022
prepared in accordance with International Financial Reporting Standards as adopted
by the European Union presented together with independent auditor’s report
Darius Šulnis, the President of Invalda INVL, signs the Consolidated and Company's Financial Statements
for 2022 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 2022 as well as the Confirmation of Responsible Persons, with a qualified electronic
signature.
AB „Invalda INVL“ Registro tvarkytojas VĮ Registrų centras
Gynėjų g. 14, LT01109 Vilnius Įmonės kodas 121304349
Tel. (8 5) 279 0601 PVM kodas LT213043414
El. p. info@invaldainvl.com; www.invaldainvl.com A.s. LT25 4010 0424 0124 2013
E. pristatymo dėžutės adresas 121304349 Luminor bank AB
CONFIRMATION OF RESPONSIBLE PERSONS
OF THE PUBLIC JOINT-STOCK COMPANY INVALDA INVL
7 April 2023
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 2022 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 2022 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 2022.
2. Consolidated Annual Report for 2022.
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 ............................................................ 37
4. SEGMENT INFORMATION ..................................................................................................................................... 40
5. OTHER INCOME AND EXPENSES ........................................................................................................................... 44
5.1. Net changes in fair value on financial instruments ...................................................................................................... 44
5.2. Employee benefits expenses ......................................................................................................................................... 44
5.3. Other expenses ............................................................................................................................................................ 44
6. INCOME TAX ........................................................................................................................................................ 45
7. EARNINGS PER SHARE.......................................................................................................................................... 49
8. DIVIDENDS PER SHARE ........................................................................................................................................ 50
9. PROPERTY, PLANT AND EQUIPMENT .................................................................................................................... 51
10. INTANGIBLE ASSETS AND COSTS TO OBTAIN CONTRACTS WITH CUSTOMERS ....................................................... 52
11. FINANCIAL INSTRUMENTS BY CATEGORY ............................................................................................................ 54
12. FAIR VALUE ESTIMATION .................................................................................................................................... 56
13. FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS ............................................................................ 64
14. LOANS GRANTED ................................................................................................................................................. 65
15. TRADE, OTHER RECEIVABLES AND CONTRACT ASSETS ........................................................................................ 65
16. CASH AND CASH EQUIVALENTS ........................................................................................................................... 67
17. SHARE CAPITAL, SHARE PREMIUM AND OWN SHARES .......................................................................................... 67
18. RESERVES ........................................................................................................................................................... 68
19. BORROWINGS ...................................................................................................................................................... 71
20. TRADE PAYABLES ................................................................................................................................................ 71
21. CONTRACT LIABILITIES ....................................................................................................................................... 71
22. OTHER LIABILITIES .............................................................................................................................................. 72
23. DISPOSAL GROUP CLASSIFIED AS HELD FOR SALE ................................................................................................ 72
24. FINANCIAL RISK MANAGEMENT........................................................................................................................... 73
24.1. Financial risk factors .................................................................................................................................................. 73
24.2. Capital management .................................................................................................................................................... 76
25. COMMITMENTS AND CONTINGENCIES .................................................................................................................. 77
26. LEASE ................................................................................................................................................................. 78
27. RELATED PARTY TRANSACTIONS ......................................................................................................................... 79
28. IMPACT OF INVASION OF THE RUSSIAN FEDERATION TO UKRAINE ...................................................................... 84
29. EVENTS AFTER THE REPORTING PERIOD............................................................................................................... 84
CONSOLIDATED ANNUAL REPORT .......................................................................................................................85
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(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. Tomas Bubinas (from 30 April 2022)
Mr. Darius Šulnis (till 30 April 2022)
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
Lvivo str. 101,
Vilnius, Lithuania
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 2022
(all amounts are in EUR thousand unless otherwise stated)
5
Consolidated and Company’s income statements
Group
Company
Notes
2022
2021
2022
2021
Revenue from contracts with customers
4
143
72
Dividend income
5,061
4,098
Other income
41
32
Net changes in fair value of financial instruments at fair
value through profit or loss
5.1
12,025
29,416
Employee benefits expenses
5.2
(10,755 )
(8,407 )
(779)
(378)
Funds distribution fees
(62 )
(90 )
-
-
Amortisation of costs to obtain contracts with customers
10
(370 )
(361 )
-
-
Information technology maintenance expenses
(1,096 )
(669 )
(7)
(7)
Depreciation and amortisation
9, 10
(1,033 )
(848 )
(25)
(22)
Premises rent and utilities
(253 )
(159 )
(10)
(7)
Advertising and other promotion expenses
(361 )
(295 )
-
-
Other expenses
5.3
(4,225 )
(3,172 )
(701)
(460)
Operating profit (loss)
15,748
32,744
Finance costs
(90 )
(81 )
(45)
(8)
Share of net (loss) profit of consolidated subsidiaries
accounted for using the equity method
3
416
6,143
Profit (loss) before income tax
16,119
38,879
Income tax income (expenses)
6
(2,116 )
547
(1,426)
NET PROFIT FOR THE YEAR
16,666
37,453
Attributable to:
Equity holders of the parent
16,666
37,453
Non-controlling interests
-
-
Basic earnings per share (in EUR)
7
1.41
3.19
Diluted earnings per share (in EUR)
7
1.38
3.13
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
6
Consolidated and Company’s statements of comprehensive income
Group
Company
2022
2021
2022
2021
NET PROFIT FOR THE YEAR
16,666
37,453
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
16,666
37,453
Attributable to:
Equity holders of the parent
16,666
37,453
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 2022
(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
2022
As at 31
December
2021
As at 31
December
2022
As at 31
December
2021
ASSETS
Non-current assets
Property, plant and equipment
9
80
95
Intangible assets and costs to obtain contracts
10
-
-
Investments into subsidiaries
1, 12, 3
70,272
50,470
Investments into associates
1, 12, 3
25,975
22,481
Financial assets at fair value through profit or loss
12, 13
37,936
47,887
Other non-current receivable
-
-
Deferred tax asset
6
-
-
Total non-current assets
134,263
120,933
Current assets
Trade, other receivables and contract assets
15
2,582
433
Prepaid income tax
167
-
Prepayments and deferred charges
34
38
Financial assets at fair value through profit or loss
12, 13
-
3,609
Cash and cash equivalents
16
372
716
Assets of disposal group classified as held for sale
23
-
-
Total current assets
3,155
4,796
TOTAL ASSETS
137,418
125,729
EQUITY AND LIABILITIES
Equity
Share capital
1, 17
3,494
3,474
Own shares
(929 )
(929 )
(929)
(929)
Share premium
5,033
5,033
Reserves
18
13,740
13,490
Retained earnings
109,452
100,139
Equity attributable to equity holders of the parent
130,790
121,207
Non-controlling interests
-
-
Total equity
130,790
121,207
Liabilities
Non-current liabilities
Lease liabilities
26
61
76
Deferred tax liability
6
2,352
2,902
Contract liabilities
21
-
-
Other non-current liabilities
22
-
-
Total non-current liabilities
2,413
2,978
Current liabilities
Borrowings
19
3,300
-
Lease liabilities
26
25
24
Trade payables
20
34
50
Income tax payable
-
-
Advances received
-
700
Contract liabilities
21
-
-
Other current liabilities
22
856
770
Liabilities directly associated with the assets held for
sale
23
-
-
Total current liabilities
4,215
1,544
Total liabilities
6,628
4,522
TOTAL EQUITY AND LIABILITIES
137,418
125,729
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(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 2021
(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 )
Net profit for the year 2022
Total comprehensive income for the year
Changes in reserves
18
(238 )
Increase of share capital (share options exercised)
17
(6 )
Share-based payments
18
Transfer from share-based payments reserve to
retained earnings (share options exercised)
(329 )
Dividends approved
8
(7,682 )
(7,682 )
(7,682 )
Dividends to non-controlling interests of
subsidiaries
(59 )
(59 )
Total transactions with owners of the
Company, recognised directly in equity
(7,591 )
(7,083 )
(59 )
(7,142 )
Balance as at 31 December 2022
(929 )
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(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 2021
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
Net profit for the year 2022
-
-
-
-
-
16,666
16,666
Total comprehensive income for the year
-
-
-
-
-
16,666
16,666
Share-based payments
18
-
-
-
585
-
-
585
Increase of share capital (share options exercised)
17
20
-
-
(6)
-
-
14
Transfer from share-based payments reserve to
retained earnings (share options exercised)
-
-
-
(329)
-
329
-
Dividends approved
8
-
-
-
-
-
(7,682)
(7,682)
Total transactions with owners of the
Company, recognised directly in equity
20
-
-
250
-
(7,353)
(7,083)
Balance as at 31 December 2022
3,494
(929)
5,033
2,923
10,817
109,452
130,790
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
10
Consolidated and Company’s statements of cash flows
Group
Company
Notes
2022
2021
2022
2021
Cash flows from (to) operating activities
Net profit for the year
16,666
37,453
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
25
22
(Gain) on disposal of property, plant and equipment
(26 )
-
-
Realized and unrealized loss (gain) on investments
5.1
(13,533 )
(33,572 )
(12,025)
(29,416)
Share of net (loss) profit of consolidated subsidiaries
accounted for using the equity method
(416)
(6,143)
Interest income
(99 )
(31 )
(41)
(31)
Interest expenses
39
8
Income tax (income) expenses
6
(796 )
(547)
1,426
Other impairment
-
-
Change in provisions
(100 )
-
-
Share-based payments
18
396
29
Dividend income
(5,196 )
(4,119 )
(5,061)
(4,098)
(964 )
(964)
(750)
Working capital adjustments:
Decrease (increase) in trade, other receivables and
contract assets
(3,139 )
120
57
Decrease (increase) in other current assets
(177 )
4
(27)
Increase (decrease) in trade payables
(45 )
(81)
28
Increase (decrease) in contract and other liabilities
(10)
119
Cash flows from (to) operating activities
(931)
(573)
Income tax paid
(254 )
(208 )
-
-
Net cash flows from (to) operating activities
(931)
(573)
(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 2022
(all amounts are in EUR thousand unless otherwise stated)
11
Consolidated and Company’s statements of cash flows (cont’d)
Group
Company
Notes
2022
2021
2022
2021
Cash flows from (to) investing activities
Acquisition of non-current assets (intangible and property,
plant and equipment)
(365 )
(271 )
-
(1)
Proceeds from sale of non-current assets (intangible and
property, plant and equipment)
-
-
Costs to obtain contracts with customers
(435 )
(455 )
-
-
Acquisition and establishment of subsidiaries, net of cash
acquired for consolidated subsidiaries
3
(4,094 )
(4,856)
(8,800)
Proceeds from sales of unconsolidated subsidiaries and
redeemed convertible bonds
3
3,132
1,344
Deconsolidation of subsidiary net of cash deconsolidated
(317 )
-
-
Acquisition of associates
3
-
-
Proceeds from sales of associates
3
-
5,353
Acquisition of financial assets at fair value through profit or
loss (except held-for-trading)
(5,410 )
(11,204 )
(4,647)
(2,044)
Sale of financial assets at fair value through profit or loss
(except held-for-trading)
1,367
1,417
Dividends received
7,581
5,965
Loans granted
(2,384 )
(2,687 )
-
(2,687)
Repayment of granted loans
2,234
-
Interest received
45
26
Net cash flows from (to) investing activities
(941 )
4,856
573
Cash flows from (to) financing activities
Cash flows related to company shareholders:
Issue of shares
17
14
13
Dividends paid to equity holders of the parent
(7,520 )
(33 )
(7,520)
(33)
Dividends paid to non-controlling interests
(59 )
(78 )
-
-
Disposal of own shares
17
-
-
(7,565 )
(98 )
(7,506)
(20)
Cash flows related to other sources of financing:
Proceeds from borrowings
3,300
-
Repayment of borrowings
-
-
Payments of lease liabilities
(450 )
(294 )
(24)
(18)
Interest paid
(90 )
(81 )
(39)
(8)
(375 )
3,237
(26)
Net cash flows to financing activities
(4,805 )
(473 )
(4,269)
(46)
Impact of currency exchange on cash and cash
equivalents
-
-
Net increase (decrease) in cash and cash equivalents
(1,992 )
(344)
(46)
Cash and cash equivalents at the beginning of the year
16
716
762
Cash and cash equivalents at the end of the year
16
372
716
(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 2022
(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 investment management group and
insurance, agriculture, real estate, bank activities. Investment management segment provides investment-related services to
investors and third parties. The entities of the investment 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 2022 and 31 December
2021 the shareholders of the Company were:
2022
2021
Number of
shares held
Percentage
(%)
Number of
shares held
Percentage
(%)
UAB Lucrum Investicija (sole shareholder Mr. Darius
Šulnis)
3,181,702
26.41
3,181,702
26.56
UAB LJB Investments (controlling shareholder Mr.
Alvydas Banys)
3,098,196
25.71
3,098,196
25.87
Mrs. Irena Ona Mišeikienė
3,006,834
24.96
3,006,834
25.10
Mr. Alvydas Banys
910,875
7.56
910,875
7.60
Ms. Indrė Mišeikytė
236,867
1.97
236,867
1.98
The Company (own shares)
229,541
1.90
229,541
1.92
Other minor shareholders
1,384,037
11.49
1,314,558
10.97
Total
12,048,052
100.00
11,978,573
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.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
13
1 General information (cont’d)
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
14
1 General information (cont’d)
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
15
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(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
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 is currently revisiting their accounting policy information disclosures to ensure consistency with the
amended requirements.
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 amendments are not expected to have a material impact on the Group’s and the Company’s 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.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(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)
IFRS 17 Insurance Contracts and amendments to IFRS 17 (cont’d)
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.
The impact of the new standard will be material to unconsolidated subsidiary INVL Life UADB, but the investment to subsidiary
is measured at fair value through profit or loss. Therefore, the new standard will not impact financial statements of the Group and
the Company.
Amendments to IFRS 17: Transition option to insurers applying IFRS 17 (effective for annual periods beginning on or after 1
January 2023).
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. Amendments would not impact financial
statements of the Group and the Company, as described above regarding impact of IFRS 17.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(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)
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).
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.
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 2024 once adopted by the EU).
These 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. The October 2022
amendment established that loan covenants to be complied with after the reporting date do not affect the classification of debt as
current or non-current at the reporting date. Management’s expectations whether they will subsequently exercise the right to defer
settlement do not affect classification of liabilities. 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 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 IFRS 16 Leases: Lease Liability in a Sale and Leaseback (effective for annual periods beginning on or after 1
January 2024 once adopted by the EU).
The amendments relate to the sale and leaseback transactions that satisfy the requirements in IFRS 15 to be accounted for as a
sale. The amendments require the seller-lessee to subsequently measure liabilities arising from the transaction and in a way that
it does not recognise any gain or loss related to the right of use that it retained. This means deferral of such a gain even if the
obligation is to make variable payments that do not depend on an index or a rate. The Group and the Company are expecting that
the amendments would be not relevant for them.
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.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
19
2 Summary of significant accounting policies (cont’d)
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 do not have definitive maturity terms. The
Company and the Group also invest to the collective investment undertakings, which have limited life or are traded on exchange
or are open-ended funds 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.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
20
2 Summary of significant accounting policies (cont’d)
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
21
2 Summary of significant accounting policies (cont’d)
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
22
2 Summary of significant accounting policies (cont’d)
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 2022
(all amounts are in EUR thousand unless otherwise stated)
23
2 Summary of significant accounting policies (cont’d)
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
24
2 Summary of significant accounting policies (cont’d)
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
25
2 Summary of significant accounting policies (cont’d)
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
26
2 Summary of significant accounting policies (cont’d)
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
27
2 Summary of significant accounting policies (cont’d)
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
28
2 Summary of significant accounting policies (cont’d)
2.19. Revenue recognition and costs to obtain contract with customers
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(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)
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
30
2 Summary of significant accounting policies (cont’d)
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
31
2 Summary of significant accounting policies (cont’d)
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
32
2 Summary of significant accounting policies (cont’d)
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
33
2 Summary of significant accounting policies (cont’d)
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(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.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
35
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
36
2 Summary of significant accounting policies (cont’d)
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
37
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
38
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
39
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
40
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
41
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
42
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
43
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
44
5. Other income and expenses
5.1. Net changes in fair value on financial instruments
Group
Company
2022
2021
2022
2021
Net gain (loss) from changes in fair value of unconsolidated
subsidiaries and associates
7,993
10,836
9,612
10,836
Net gain (loss) from financial assets at fair value through profit or
loss
5,540
22,736
2,413
18,580
Net gain (loss) from financial instruments at fair value through
profit or loss, total
13,533
33,572
12,025
29,416
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
45
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
46
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
47
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
48
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
49
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
50
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
51
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
52
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
53
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
54
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
55
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
56
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
57
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
58
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
59
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
60
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
61
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
62
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
63
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
64
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
65
14. Loans granted
As at 31 December 2021 the Group’s and the Company’s loans granted with nominal value of EUR 682 thousand 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. In 2022 the bankruptcy of the entity, to which loans is granted, was finished, entity was liquidated, the Group
and the Company has not received any inflows. Therefore, the granted loan was written-off juridically and enforcement activity is
ended.
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
66
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
67
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
68
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
69
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
70
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
71
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
72
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
73
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
74
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
75
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
76
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
77
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
78
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
79
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
80
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
81
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
82
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
83
27 Related party transactions (cont’d)
AB INVALDA INVL, company code 121304349, Gynėjų str. 14, Vilnius, Lithuania
CONSOLIDATED AND COMPANY’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022
(all amounts are in EUR thousand unless otherwise stated)
84
28. 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 was affected by the decrease of market price of listed
companies. This directly contributed to the decline in the value of Level 1 and Level 2 financial assets. This decline also reduced
the Group's income generated from the management fee received for the managed investment products in 2022.
AB INVALDA INVL
Consolidated Annual Report for 2022
CONSOLIDATED ANNUAL REPORT FOR 2022 | 86
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
PRESIDENT’S STATEMENT .............................................................................................................................. 88
1. Reporting period for which the report is prepared ............................................................................... 89
2. General information about the Issuer and other companies comprising the group ............................ 89
2.1. Information about the Issuer ......................................................................................................... 89
2.2. company’s philosophy and operating principles ........................................................................... 89
II. FINANCIAL INFORMATION AND SIGNIFICANT EVENTS ..................................................................................... 91
3. Business environment ......................................................................................................................... 91
4. Performance results of the issuer and the group ................................................................................ 92
4.1. Main items of financial statements ............................................................................................... 92
4.2. Calculation of the net asset value of Invalda INVL ....................................................................... 92
4.3. Financial ratios .............................................................................................................................. 93
5. Information on the group’s activities .................................................................................................... 93
5.1. Investment management and life insurance ................................................................................. 93
5.2. Investments (direct and indirect) as of 31.12.2022 ...................................................................... 94
6. Estimation of Issuer’s and Group’s activity last year and activity plans and forecasts ....................... 95
6.1. Evaluation of implementation of goals for 2022 ........................................................................... 95
6.2. 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 2022 ........................................................ 96
7.3. Information about the issuer’s treasury shares ............................................................................ 97
7.4. Information about employees stock options ................................................................................. 97
8. The order of amendment of Issuer’s Articles of Association ............................................................... 98
9. Shareholders ....................................................................................................................................... 98
9.1. Information about shareholders of the company .......................................................................... 98
9.2. Rights and obligations carried by the shares ............................................................................. 100
10. Dividends ......................................................................................................................................... 101
11. Trading in Issuer’s securities as well as securities of the group companies’ .................................. 101
11.1. Trading in Issuer’s securities .................................................................................................... 101
11.2. Trading in securities of the group companies’ .......................................................................... 104
IV. ISSUER’S MANAGING BODIES .................................................................................................................. 104
12. Structure, authorities, the procedure for appointment and replacement ......................................... 104
12.1. General Shareholders’ Meeting ................................................................................................ 104
12.2. The Board ................................................................................................................................. 106
12.3. The President ........................................................................................................................... 107
13. Information about members of the Board, CFO and the Audit Committee of the Company .......... 108
14. Information about the Audit Committee of the company ................................................................. 111
CONSOLIDATED ANNUAL REPORT FOR 2022 | 87
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 .............................................................................. 112
V. OTHER INFORMATION .............................................................................................................................. 113
16. Agreements with intermediaries on public trading in securities ...................................................... 113
17. Information on Issuer’s branches and representative offices .......................................................... 113
18. Risk management ........................................................................................................................... 113
18.1. A description of the principal risks and uncertainties ............................................................... 113
18.2. Information about the extent of risk and its management in the Company .............................. 115
18.3. The main indications about internal control and risk management systems related to the preparation
of consolidated financial statements .................................................................................................. 115
18.4. Information on financial risk management objectives used for hedging measures which hedge
accounting ......................................................................................................................................... 115
19. Issuer’s and its group companies’ non – financial results. Information related to to social responsibility,
environment and employees ................................................................................................................. 115
19.1. Responsible business actions in the company ......................................................................... 115
19.2. Employees ................................................................................................................................ 116
19.3. 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.117
19.4. Revealing the impact of Russia's war in Ukraine ..................................................................... 117
19.5. ENVIRONMENTAL PROTECTION AND ACTIONS ON CLIMATE CHANGE......................... 117
19.6. THE FIGHT AGAINST CORRUPTION AND BRIBERY ........................................................... 117
20. Memberships in associations .......................................................................................................... 117
21. Information on harmful transactions in which the issuer is a party ................................................. 118
22. Information on the related parties’ transactions .............................................................................. 118
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 impact118
24. Significant investments made during the reporting period and after the end of the financial year . 118
25. References to and additional explanations of the data presented in the financial statements and
consolidated financial statements ......................................................................................................... 119
26. Data on the publicly disclosed information ...................................................................................... 119
27. Information on audit company ......................................................................................................... 121
APPENDIX 1. INFORMATION ABOUT GROUP COMPANIES, THEIR CONTACT DETAILS ........................................... 122
APPENDIX 2. DISCLOSURE CONCERNING THE COMPLIANCE WITH THE GOVERNANCE CODE ............................. 124
APPENDIX 3. COMPANY'S MANAGEMENT REPORT ......................................................................................... 138
APPENDIX 4. REMUNERATION REPORT .............................................................................................. 140
CONSOLIDATED ANNUAL REPORT FOR 2022 | 88
PRESIDENT’S STATEMENT
Dear All,
In 2022, the evolving geopolitical and economic environment in the
world had a major impact on businesses and investment decisions.
The war in Europe, the volatility of markets and energy prices, and the
rapid rise of interest rates all posed challenges but also opened up
new opportunities. The general decline in most markets led to losses
for a large number of investors last year. However, it is important that
in the longer term, even taking into account negative periods, the
investments have provided and continue to provide an appropriate
return for investors.
Invalda INVL had significant transactions in the asset management
area in 2022. At the start of July, we completed the acquisition of
Mandatum Life's life insurance business in the Baltics, and late in the
year, we signed an agreement on merging part of the retail businesses
of Invalda INVL and Šiaulių Bankas. These are fundamental steps in
the development of a retail business geared towards a more mature
society that seeks stable financial grounding and investment income.
The next-generation bank that is being created, with Invalda INVL as one of its major shareholders, will provide even more
services from one source and offer market-driven solutions that deliver more value to clients, employees, and investors.
Despite a volatile year, our clients increased their investments in the products the group manages and by year-end we had
reached EUR 1.9 billion in assets under management, with pension funds continuing to represent the largest amount. The
private equity, alternative and real assets funds managed by the INVL group successfully created value for investors as they
continued to make acquisitions and raise funds. The INVL Baltic Sea Growth Fund, the leading private equity investment
fund in the Baltics, added two companies in Lithuania and one in Latvia to its portfolio, and through portfolio companies
invested in the Czech Republic and Poland. The successful operations of the majority of the companies the fund manages
resulted in good performance and growth in value by the fund. According to unaudited data, portfolio companies of INVL
Baltic Sea Growth Fund employ about 8,000 people, and last year's total income exceeded EUR 500 million, EBITDA
reached EUR 55 million. The Fund continues to actively look for opportunities to invest in businesses in the Baltic States,
Poland, and other surrounding markets. We have already raised more than EUR 81 million for our second sustainable forest
and farmland fund, the INVL Sustainable Timberland and Farmland Fund II (STAFF II), and increased land holdings in Latvia.
The INVL Renewable Energy Fund I, which is currently investing in renewable energy projects in Poland and Romania and
has raised EUR 52.9 million from investors, expanded its portfolio of solar park projects to 475 megawatts (MW). We also
carried out investment activities and developed our existing investments in the areas of real estate, private debt, and
information technologies.
We have focused on feeder funds. The INVL Partner Global Infrastructure Fund I, which invests in the infrastructure fund of
a long-standing world-class asset manager, was launched in late 2021, and the INVL Partner Private Equity Fund I, which
invests in EQT X, a fund with a target size of EUR 20 billion established by EQT, one of the world's leading private equity
investment firms, was launched in early 2023. The funds are successful putting investors' money to work outside their home
region and offering more opportunities to diversify investment risk. We intend to continue to gain strength in this area and
offer our clients the solutions needed to invest in leading global products.
For the INVL Family Office, 2022 was a year of growth. A range of new investment products and services have meant
growing income for its clients. We are delighted that years of focused work and value creation are yielding rapid growth in
existing clients' investments and attracting new ones.
Importantly, 2022 was a record year for our other investments – Šiaulių Bankas, Moldova's largest bank Moldova-
Agroindbank, and Litagra. While both banks performed well, that was not reflected in share price growth due to the unusual
situation in the markets. We believe that such strong, well performing banks that generate high returns and are growing
rapidly will gain the market's appreciation. Litagra, one of Lithuania's largest agribusiness groups, delivered excellent results
following several acquisitions, partly driven by global growth of food prices. Expansion in the poultry, feed and dairy sectors
is significantly increasing the company's potential. We expect reconfiguration of acquired assets and other actions focused
on growth and economies of scale to boost sales in the near term and have a positive impact on competitiveness and long-
term earnings in these areas.
Given the prevailing conditions in the markets, we view 2022 as a reasonably good year. Work we carried out or started last
year will undoubtedly have a significant impact on the value and performance of our business in the future. Invalda INVL had
a net profit was EUR 16.7 million for the year and net assets of EUR 130.8 million at year-end. Last year, the company paid
its shareholders dividends of EUR 7.6 million.
On behalf of Invalda INVL, I thank our clients for the trust they have placed in us amidst volatile markets and a challenging
geopolitical environment, and our employees for their dedication, focus and professionalism. I thank our shareholders for
their support and belief in the value we create. Transformation, change, and growth mean new opportunities for all those
who have been working with us for many years, or who are willing and able to join the INVL group's team in creating value
for those who entrust their funds to us and in growing the economies of the countries and the areas we invest in while at the
same time unlocking the potential and the needs of each and every member of the team.
Sincerely,
Darius Šulnis
CONSOLIDATED ANNUAL REPORT FOR 2022 | 89
I. GENERAL INFORMATION
1. Reporting period for which the report is prepared
The report is prepared for 12 months of 2022 (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
2.1. 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
2.2. COMPANY’S PHILOSOPHY AND OPERATING PRINCIPLES
Who are we?
Invalda INVL is an investment management and life insurance with an open approach, growing and developing, and creating
well-being for people through its activities.
Since the beginning of our activities, we have been working consistently and purposefully in the field of 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 investment 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 provide customers with the best choice when it comes to long-term savings, personal finance management,
financial security and well-being solutions. We acquired the life insurance business in order to create a group that can offer
existing and new INVL customers even more products and solutions that meet their needs. Due to favourable circumstances,
we did not have time to fully complete this and integrate the life insurance business into INVL, and we are transferring it over
to Šiaulių Bankas, which will provide new generation financial services, where we will have up to 20% of the shares and thus
remain in this business.
How do we operate?
Investment management and life insurance is our core business. The Group's companies provide services to more than 300
thousand individual and institutional regional and international clients entrusting the Invalda INVL group to manage about
EUR 1.9 billion worth of assets. At the group level, we manage different asset classes such as pension and investment
funds, life insurance products, 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.
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.
CONSOLIDATED ANNUAL REPORT FOR 2022 | 90
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 70.4 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 2 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 investment management and life insurance business
CONSOLIDATED ANNUAL REPORT FOR 2022 | 91
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.
2022 was not a successful year for the Baltic equity markets, reflecting the changed economic backdrop both in Lithuania
and globally. Russia's war in Ukraine, the tense situation in the energy sector, rising interest rates and fears of recession are
among the main factors reflected in stock prices. Among the Baltics, the Vilnius Stock Exchange index stood out, recording
a loss of only 1.97%, while the Riga index fell -9.53% and the Tallinn index -11.71%. Similar trends were observed both in
Western Europe, where stock markets fell by 12.90% (according to the STOXX Europe 600 index), and globally, where the
MSCI ACWI index, which measures the global stock market in dollars, fell by 19.8% over 2022.
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 situation of the Baltic securities
market or the common Baltic securities market and its changes.
GROWTH OF THE BALTIC STOCK MARKETS
Index
31.12.2021
31.12.2022
+/- Change
OMX Tallinn
2,001.03
1,766.73
-11.71%
OMX Riga
1,274.2
1,152.8
-9.53%
OMX Vilnius
966.13
947.14
-1.97%
Source: Nasdaq Baltic
According to information from the State Data Agency, the average annual inflation rate in 2022 in Lithuania was 19.7% (for
comparison, in 2021 annual inflation was recorded at 4.7%). The average annual inflation was mainly driven by the increase
in the prices of fuel and lubricants, thermal energy, solid fuels, milk and dairy products, cheese and eggs, meat and meat
products, bread and cereal products, electricity, vegetables, products and materials for the maintenance and repair of
housing, and cars. However, prices for audio and video reception, recording, and reproduction equipment as well as
telephone equipment have decreased. Consumer goods prices increased by 25.2% year-on-year and services prices − by
13.2%. Average annual inflation stood at 9.2% in the European Union (EU) in 2022 and 8.4% in the euro area. Average
annual inflation in Lithuania was 18.9% according to the Harmonised Index of Consumer Prices (HICP) with other EU
Member States (compared to 4.6% in 2021).
Lithuania’s gross domestic product (GDP) in 2022 was €67.1 billion at the prices of the time, based on preliminary data from
the State Data Agency. Compared to 2021, the real GDP change, excluding seasonal and working days, was positive at
2.2%. GDP growth peaked at 0.9% in Q1 (after seasonal and working days were removed and compared to the previous
quarter). This was mainly influenced by the performance of industry, wholesale, and retail, professional, scientific, and
technical, and administrative and service companies. GDP fell by 0.5% in Q2, driven by lower performance in transport and
storage, construction and real estate businesses, and grew by 0.4% in Q3 − driven by the success of industry, information
and communication, and agricultural enterprises. In the last quarter of the year, GDP fell by 1.7% compared to Q3, according
to preliminary data − the most significant drop in the EU as a whole.
According to the Republic of Lithuania Ministry of Finance, the post-pandemic recovery momentum gained in 2021 simmered
down in 2022, affected by geopolitical uncertainty and an unfavourable external environment. The geopolitical tensions
caused by the war in Ukraine, the sharp increase in uncertainty, and the ongoing disruptions in supply chains hampered the
planning and implementation of investment projects, while the rise in inflation reduced household purchasing power and led
to an increase in interest rates. However, the labour market has remained healthy. The number of employed persons has
increased sharply, unemployment has been falling, the active population of working age has increased, and the number of
job vacancies has remained close to record levels. Employment growth was driven by high economic activity, strong labour
demand in many sectors of the economy, and space for employment growth to record highs (80% in Q3 in the 15−64 age
group) and the labour market participation of Ukraine’s working-age war refugees. Labour market participation of the working-
age population was driven by strong labour shortages, increased chances of finding their desired job, strong wage growth,
and expected high inflation rates. However, a possible decline in economic activity may lead to a slight increase in the
unemployment rate in the near future. In the short term, the worsening situation is likely to affect in particular the demand for
unskilled or less skilled workers. There is still a shortage of highly skilled workers in the labour market, and the slowdown in
economic activity is expected to be temporary, so companies should not rush to drop highly skilled workers; therefore, no
significant increase in unemployment is expected. The strong demand for and shortages of skilled workers faced by both
the private and the public sector, as well as government decisions on the remuneration of public sector employees (increased
wages for education, healthcare, statutory staff, an increase in the basic salary for civil servants and other employees of
budgetary institutions), a significant increase in MMA (13.7% to €730), and an increase in inflation expectations led to wage
growth in the country in 2022. However, while average wage growth was rather marked at 13%, real wages fell by almost
7% due to inflation. Wage growth is projected to reach 9.1% in 2023.
CONSOLIDATED ANNUAL REPORT FOR 2022 | 92
According to the Bank of Lithuania’s review of the development and outlook of the Lithuanian economy, in the coming years,
it will depend on the continuation of Russia’s war against Ukraine and on the efforts of governments to mitigate the negative
economic consequences of the war. Hostilities, sanctions, and the responses to them have significantly increased global
prices (and their volatility) of raw materials, in particular energy and food. This is especially detrimental not only to the
development of Lithuania’s economies, but also to many of Lithuania’s main trading partners, in particular European
countries, through the shrinking purchasing power of households, the loss of competitiveness of exporting firms, and the
need to tighten monetary policy. As these unfavourable factors may lead not only to a short-term slowdown in economic
growth but also to a significant longer-lasting recession, governments’ efforts to mitigate the negative effects of these factors
are crucial during this period. In 2023, the amount of funds planned to be allocated in the state budget for compensating the
part of gas and electricity prices for residents and businesses should amount to 1.2% of GDP, for increasing the income of
residents − 1.7% of GDP, and spending on public investment projects should increase by 0.6% of GDP. This implies that
both household consumption and investment are expected to show a rather favourable development in 2023. As many of
Lithuania’s main trading partners will apply similar household and business support packages, demand for Lithuanian goods
and services in foreign markets is expected to recover from the beginning of 2023 and at the end of next year to reach the
level prior to Russia’s invasion of Ukraine. This evolution of demand in Lithuania’s main trading partners will also lead to
more favourable development of the exports of goods and services. Lithuania’s real GDP is projected to grow by 1.3% in
2023. Moreover, if unexpected shocks in commodity markets do not occur, the annual inflation peak will remain in the past.
Annual inflation is expected to continue to decline as the effect of the higher comparative base increases, with lower
commodity prices and supply chain disruptions. The rise in energy prices is projected to dampen significantly next year,
while food prices, including alcoholic beverages and tobacco, will be the main determinant of inflation. The rise in the
purchase prices of food raw materials in Lithuania and the increase in energy costs contributed significantly to food price
increases in 2022 and will also affect the evolution of food prices in 2023. However, the tightening of Lithuania’s economy
and the weakening of supply chain disruptions will reduce core inflation, which does not include the most volatile energy and
food products. Taking this into account, the forecast for general inflation is a decline to 9.5% in 2023.
4. Performance results of the issuer and the group
4.1. MAIN ITEMS OF FINANCIAL STATEMENTS
EUR thousand
COMPANY‘S
GROUP‘S
2020
2021
2022
2020
2021
2022
Non-current assets
83,737
120,933
134,263
80,665
115,961
121,358
Current assets
1,672
4,796
3,155
9,715
16,064
22,668
Equity
83,157
121,207
130,790
83,357
121,355
130,927
Non-current liabilities
1,458
2,978
2,413
3,783
5,678
3,599
Current liabilities
794
1,544
4,215
3,240
4,992
9,500
Result before taxes
5,209
38,879
16,119
5,329
39,595
15,918
Net result
5,329
37,453
16,666
5,373
37,479
16,714
Net result attributable to
holders of the parent Company
-
-
-
5,329
37,453
16,666
4.2. CALCULATION OF THE NET ASSET VALUE OF INVALDA INVL
EUR thousand
Evaluation criteria
2020
2021
2022
Investment into investment management
business and life insurance
Equity method & fair
value
13,930
27,473
79,325
Other investments
Fair value
69,712
96,974
54,858
Receivables
Amortised cost
882
433
2,582
Other assets
Residual value
123
133
281
Cash and cash equivalents
Amortised cost
762
716
372
Total assets
Book value
85,409
125,729
137,418
Liabilities
Cost
2,252
4,522
6,628
Net asset value
Book value
83,157
121,207
130,790
Net asset value per share
Book value
7.11
10.32
11.07
CONSOLIDATED ANNUAL REPORT FOR 2022 | 93
4.3. FINANCIAL RATIOS
Company’s
Group’s
2020
2021
2022
2020
2021
2022
Return on Equity (ROE), %
6.27
36.65
13.23
6.27
36.65
13.23
Debt ratio
0.03
0.04
0.05
0.08
0.08
0.09
Debt – Equity ratio
0.03
0.04
0.05
0.08
0.09
0.10
Liquidity ratio
2.11
3.11
0.75
3.00
3.22
2.39
Earnings per share (EPS), EUR
0.46
3.19
1.41
0.46
3.19
1.41
Price Earnings ratio (P/E)
16.62
5.32
8.07
16.62
5.32
8.07
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/
The profit of Invalda INVL 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 investment 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. INVESTMENT MANAGEMENT BUSINESS AND LIFE INSURANCE
Invalda INVL manages licensed asset management companies INVL Asset Management in Lithuania and Latvia, financial
brokerage company INVL Financial Advisors (previous company name is INVL Finasta), land administration company INVL
Farmland Management and asset management company Mundus through INVL Asset Management (in February 2023, the
shareholding in Mundus was increased from 51% to 100%). Their results are evaluated on the basis of revenue and profit.
since 1 July 2022, when Invalda INVL successfully implemented the acquisition of one of the largest Finnish life insurance
companies’ business in the Baltic States, Invalda INVL through the 100% owned licensed insurance company INVL Life
controls the life insurance activities, which are valued at fair value, because, due to the signed transaction, it has an exit
strategy - becoming a part of the AB Šiaulių bankas group. Below is the scheme of services provided by subsidiaries
controlled by Invalda INVL:
LIFE
ASSET
MANAGEMENT
FINANCIAL
ADVISORS
FARMLAND
MANAGEMENT
CONSOLIDATED ANNUAL REPORT FOR 2022 | 94
We have been operating in the life insurance business from the beginning of the third quarter of 2022.
NUMBER OF CLIENTS, MANAGED ASSETS AND INCOME OF INVALDA INVL GROUP
EUR million
(if not stated otherwise
2021
2022
Change, %
Number of clients, thousands
260.6
303.9
16.6
Amount earned (loss incurred) for clients
210.5
(92.3)
-
Assets under management*
1,608.6
1,902.5
18.3
Investment life insurance
-
140.9
-
2nd pillar pension funds
995.6
1,022.2
2.7
3rd pillar pension funds
82.0
90.9
10.9
Investment funds
53.9
53.1
-1.5
Portfolios
89.0
135.0
51.7
Alternative assets
388.1
460.4
18.6
Revenues* investment management business
15.83
15.18
-4.1
* Investments in own products, for which no management fee is charged, have been eliminated
NUMBER OF EMPLOYEES PROVIDING INVESTMENT MANAGEMENT AND LIFE INSURANCE SERVICES
The number of employees
2020
2021
2022
-
132
158
281
The biggest impact on the increase in the number of employees made the completion of the acquisition transaction of the
Finnish life insurance company Mandatum's business in the Baltic States, when more than 80 experienced life insurance
business employees joined the group of specialists providing solutions that ensure financial security and well-being.
5.2. INVESTMENTS (DIRECT AND INDIRECT) AS OF 31.12.2022
Investment group
Investments included
Consolidated
value of owned
investments,
EUR mln.
Consolidated profit
(loss) from the
investment before
the impact of income
tax, EUR mln.
Investment management
business (operational part)
Includes value and result from the management of
money entrusted by clients, eliminating own
investments of the asset management business
7.8
(1.5)
Investments in collective
investment undertakings
managed by INVL
INVL Baltic Sea Growth Fund, INVL Sustainable
Timberland and Farmland Fund II, INVL
Renewable Energy Fund I, INVL Baltic Real
Estate, INVL Technology, other products of INVL
44.2
9.2
Investment into life insurance
business
Includes value and result after eliminating own
investments of the insurance business
6.8
5.8
Investments into banking
sector
AB Šiaulių bankas*,
Moldova-Agroindbank (maib)
51.0
(1.8)
Historical investments
UAB Litagra, AB Vernitas, Inservis group
companies (sold in May 2022), UAB Kelio ženklai
(loan)
24.3
5.6
* The positive or negative value of the forward (future acquisition from the EBRD) is included
CONSOLIDATED ANNUAL REPORT FOR 2022 | 95
6. Estimation of Issuer’s and Group’s activity last year and activity plans and forecasts
6.1. EVALUATION OF IMPLEMENTATION OF GOALS FOR 2022
A year ago, we said that we will work consistently and purposefully, and we are ready for changes when they are necessary
and meaningful. As we planned, in the middle of last year we successfully completed the acquisition of Mandatum Life's life
insurance business in the Baltic States. We also made a strategic decision regarding the development of the retail business
and on 22 November 2022 we signed an agreement with Šiaulių Bankas regarding the merger of part of the retail businesses.
This move will bring more value to customers, employees, and investors. Existing INVL customers will continue receiving
professional savings, investment, and life insurance solutions and will additionally be able to use other bank services.
Last year, the number of the retail, Family Office and institutional clients has grown. Despite the turbulent years, our
customers increased their investments in the group's managed products, the volume of which we continued to expand.
Moreover, in 2022, we actively worked with our existing investments.
In 2022, we strengthened the team and started internal transformations, which will be necessary and will have a significant
impact on our further activities and business growth after the transaction with Šiaulių Bankas.
We consider the past year to be moderately successful. The moderation in our assessment is determined by the fact that
due to an unfavourable situation in the markets, a large part of those who invested, experienced a loss from their investment
activities.
6.2. ACTIVITY PLANS AND FORECASTS
We intend to continue to successfully invest and manage assets entrusted to us, develop existing products and create new
solutions that meet our customers’ needs, increasing value for retail, Family Office and institutional investors. We do our
best to make the year profitable for those who invest with us, but we understand that this will be significantly influenced by
the market situation, which is still difficult to predict.
In 2023 we plan to complete the merger of the retail businesses of Šiaulių Bankas and Invalda INVL, which has already been
approved by the shareholders' meetings of both parties. In order to complete the transaction, it is necessary not only to
obtain the necessary permits from the supervisory authorities, but also to carry out various related transformations. We
believe that this transaction will lay the foundations for further successful activity and growth.
One of the priority tasks in 2023 is to strengthen the team since the merger of retail businesses and other changes will
require additional professionals to join INVL. The continuous improvement of the whole team is an integral part of our strategy
and competitive advantage, it is necessary for the proper performance of our daily tasks and, in particular, for ensuring the
further rapid growth of the business of Invalda INVL.
We will strengthen the existing asset management business lines and continue working on creating the new ones, taking
advantage of market changes and emerging opportunities.
We look forward to an active year, at the end of which we should have completed a number of important processes that will
lay the foundation for further successful activity and growth.
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:
• 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.
CONSOLIDATED ANNUAL REPORT FOR 2022 | 96
• 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.
• 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.
• On 11 May 2022, a new wording of the Articles of Association of Invalda INVL AB was registered in the Register of
Legal Entities. This draft of the company’s Articles of Association was approved by the shareholders at the Ordinary
General Meeting of Shareholders held on 30 April 2022. Invalda INVL increased its share capital to EUR
3,493,935.08 by issuing 69,479 new ordinary registered shares. The newly issued shares were subscribed by the
employees of Invalda INVL Group exercising the stock options granted to them in 2019.
7.2. STRUCTURE OF THE AUTHORIZED CAPITAL AS OF 31 DECEMBER 2022
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
12,048,052
12,048,052
11,818,511
0.29
3,493,935.08
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.
CONSOLIDATED ANNUAL REPORT FOR 2022 | 97
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
-
-
2022
-
-
total
229,541
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 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. 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
69 479
Newly issued shares have
been subscribed
2020
317,227
2023
N/A
2021
65 287
2024
N/A
2022
40 862
2025
N/A
CONSOLIDATED ANNUAL REPORT FOR 2022 | 98
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 11 May 2022, a new wording of the Articles of Association of Invalda INVL AB was registered in the Register of Legal
Entities. This draft of the company’s Articles of Association was approved by the shareholders at the Ordinary General
Meeting of Shareholders held on 30 April 2022. Actual wording of the Articles of Association is dated as of 11 May 2022.
The translation of the document is published on the company’s website https://www.invaldainvl.com/wp-
content/uploads/2022/05/Articles-of-Association-of-Invalda-INVL_05-11-2022_translation-from-Lithuanian.pdf
9. Shareholders
9.1. INFORMATION ABOUT SHAREHOLDERS OF THE COMPANY
At the end of 2022 the total number of shareholders was 3,774. 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, i.e. 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 2022, 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 2022
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
25.71
60.90
86.61
Alvydas Banys
2
910,875
7.56
79.05
Irena Ona Mišeikienė
3,006,834
24.96
61.65
Indrė Mišeikytė
236,867
1.97
84.64
Lucrum Investicija, UAB
code 300806471. Gynėjų str.
14, Vilnius
3,181,702
26.41
60.20
Darius Šulnis
3
0
0.00
86.61
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.
CONSOLIDATED ANNUAL REPORT FOR 2022 | 99
Distributions of the share capital of the shareholders of Invalda INVL as of 31 December 2022
Distribution of shareholders by investor groups as of 31 December 2022
Investor group
Shareholders
Votes held by shareholders
number
proportion, %
number
proportion, %
Natural persons
3,749
99
5,508,721
45.72
Legal entities
38
1
6,539,331
54.28
Distribution of shareholders by their residence as of 31 December 2022
Investor group
Shareholders
Votes held by shareholders
number
proportion, %
number
proportion, %
Residents
3,579
94.51
11,779,235
97.77
Non-residents
208
5.49
268,817
2.23
25.71%
7.56%
24.96%
1.97%
26.41%
1.91%
11.48%
UAB LJB investments (a
company controlled by A.Banys)
Alvydas Banys
Irena Ona Mišeikienė
Indrė Mišeikytė
UAB Lucrum Investicija (a
company controlled by D.Šulnis)
Company's own shares
Other shareholders (> 3400)
Legal entities Natural persons
Residents Non-residents
CONSOLIDATED ANNUAL REPORT FOR 2022 | 100
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
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.
CONSOLIDATED ANNUAL REPORT FOR 2022 | 101
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
The ordinary general meeting of the company's shareholders held on 30 April 2022 approved the allocation of a dividend
of EUR 0.65 per share for 2021. The total amount allocated to dividends is EUR 7,682 thousand. Dividends were received
by those persons who were shareholders of Invalda INVL on the tenth working day after the end of the general meeting of
shareholders that took the decision on the payment of dividends, i.e. 13 May 2022.
RATIOS RELATED WITH SHARES
2020
2021
2022
Net Asset Value per share, EUR
7.11
10.32
11.07
Price to book value (P/Bv)
1.07
1.65
1.03
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
12,048,052
Nominal value
0.29 EUR
Total nominal value
3,493,935.08 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 2022 | 102
TRADING IN INVALDA INVL, AB SHARES
2020
2021
2022
Share price, EUR
- open
6.80
7.60
17.00
- high
8.95
18.70
17.00
- low
5.65
7.60
10.00
- last
7.60
17.00
11.40
Turnover, units
89,010
63,625
70,365
Turnover, EUR
619,336
681,010
888,205
Traded volume, units
1,212
1,561
1,684
Capitalisation, EUR mln.
88.84
199.73
134.73
TRADING IN THE COMPANY’S SHARES DURING THE PERIOD OF 2020–2022 (QUARTERLY) ON NASDAQ VILNIUS
STOCK EXCHANGE:
Reporting period
Price, €
Last trading date
Total turnover
high
low
last
units
€
2020, 1st Q
7.20
5.65
5.90
31.03.2020
21,925
146,005
2020, 2nd Q
8.95
5.90
7.00
30.06.2020
31,449
219,194
2020, 3rd Q
7.25
6.90
7.25
30.09.2020
18,314
129,657
2020, 4th Q
8.40
7.00
7.60
30.12.2020
17,322
124,480
2021, 1st Q
9.60
7.60
8.85
31.03.2021
14,606
125,707
2021, 2nd Q
9.80
8.55
9.30
30.06.2021
12,545
114,832
2021, 3rd Q
11.80
9.20
11.20
30.09.2021
20,764
205,677
2021, 4th Q
18.70
11.20
17.00
30.12.2021
15,710
234,795
2022, 1st Q
17.00
10.00
12.60
31.03.2022
28,652
392,004
2022, 2nd Q
13.60
10.80
10.90
30.06.2022
18,823
234,545
2022, 3rd Q
13.20
10.60
11.00
30.09.2022
11,573
131,869
2022, 4th Q
12.20
11.00
11.40
30.12.2022
11,317
129,787
CAPITALISATION
Last trading date
Number of shares (company’s own
shares excluded), units
Last price, €
Capitalisation, €
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
31.03.2022
11,749,032
12.60
148,037,803
30.06.2022
11,818,511
10.90
128,821,770
30.09.2022
11,818,511
11.00
130,003,621
30.12.2022
11,818,511
11.40
134,731,025
CONSOLIDATED ANNUAL REPORT FOR 2022 | 103
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
01.01.2012
01.01.2022
30.12.2022
Change (%) since
2012
Change (%) in 12
months of 2022
OMX Vilnius
298.78
966.13
947.14
217
-1,97
Invalda INVL
1.943 EUR
17.00 EUR
11.40 EUR
486.72
-32.94
0
10000
20000
30000
40000
50000
60000
70000
0
2
4
6
8
10
12
14
16
18
20
02.01.2020
06.03.2020
09.05.2020
12.07.2020
14.09.2020
17.11.2020
20.01.2021
25.03.2021
28.05.2021
31.07.2021
03.10.2021
06.12.2021
08.02.2022
13.04.2022
16.06.2022
19.08.2022
22.10.2022
25.12.2022
Turnover, EUR Price, EUR
-100
0
100
200
300
400
500
600
700
800
900
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
CONSOLIDATED ANNUAL REPORT FOR 2022 | 104
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
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.
-60
-40
-20
0
20
40
60
80
02.01.2020
13.02.2020
26.03.2020
07.05.2020
18.06.2020
30.07.2020
10.09.2020
22.10.2020
03.12.2020
14.01.2021
25.02.2021
08.04.2021
20.05.2021
01.07.2021
12.08.2021
23.09.2021
04.11.2021
16.12.2021
27.01.2022
10.03.2022
21.04.2022
02.06.2022
14.07.2022
25.08.2022
06.10.2022
17.11.2022
29.12.2022
INVL Technology INVL Baltic Real Estate Šiaulių bankas
General Shareholders‘ Meeting
The Board (3 members)
The President
CONSOLIDATED ANNUAL REPORT FOR 2022 | 105
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.
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
CONSOLIDATED ANNUAL REPORT FOR 2022 | 106
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.
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 2022 1 (one) shareholders' meeting of Invalda INVL was held. The ordinary general meeting of shareholders of Invalda
INVL AB took place on 30 April 2022. 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
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.
CONSOLIDATED ANNUAL REPORT FOR 2022 | 107
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.
The company's board performs all the following supervisory functions: makes decisions on transactions with related parties,
as stipulated in Article 37
2
of the Law on Companies; supervises the activities of the company's manager, submits feedback
and suggestions regarding the activities of the company's manager to the general meeting of shareholders; considers
whether the head of the company is suitable for the position, if the company is operating at a loss; submits proposals to the
company's manager to revoke his decisions that contradict laws, other legal acts, the company's articles of association and
decisions of the general meeting of shareholders or the board; solves other issues assigned to the competence of the board
in the decisions of the general meeting of shareholders regarding the supervision of the activities of the company and the
company's manager.
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 Tomas Bubinas (independent member) were elected to the Board of Invalda INVL on
30 April 2022. The members of the Board elected by the General Meeting of Shareholders act separately and for the benefit
of the Company and its shareholders.
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.
CONSOLIDATED ANNUAL REPORT FOR 2022 | 108
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 elected during the General Shareholders’ Meeting on 30 April 2022. Mr. Banys was
elected as the Chairman of the Board. Mr. Bubinas 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 2022 | 109
Term of
office
Educational
background and
qualifications
Owned number of
shares in Invalda
INVL
Ongoing management positions
Alvydas Banys
Chairman of the Board
Since 2022
until 2026
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, 7.56
% of authorised
capital and votes;
Together with
controlled company
LJB Investments:
4,009,071 units of
shares. 33.27 % of
authorized capital
and votes.
Total votes with
others whose votes
are counted
together - 86.61%.
LJB investments, UAB (code
300822575, A. Juozapavičiaus g.
9A, Vilnius.) – CEO (the main
workplace)
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 property, UAB (code
300822529; A. Juozapavičiaus g.
9A, Vilnius.) CEO
Indrė Mišeikytė
Member of the Board
Since 2022
until 2026
Vilnius Gedimino
Technical
University.
Faculty of
Architecture.
Master in
Architecture.
Personally: 236,867
units of shares,
1.97% of authorised
capital and votes.
Total votes with
others whose votes
are counted
together - 86.61%.
Invalda INVL, AB (code 121304349,
Gynėjų g. 14, Vilnius, Lithuania) –
Adviser (the main workplace)
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 (till 06-02-2023)
Tomas Bubinas
Independent Member of the
Board
Since 2022
until 2026
Baltic
Management
Institute (BMI),
Executive MBA
Association of
Chartered
Certified
Accountants.
ACCA. Fellow
Member
Lithuanian
Sworn
Registered
Auditor
Vilnius
University, Msc.
in Economics
-
INVL Baltic Farmland, AB (code
303299781, Gynėjų g. 14, Vilnius,
Lithuania) – independent Member of
the Board (since April 2022).
The main workplace is an individual
consulting activity.
CONSOLIDATED ANNUAL REPORT FOR 2022 | 110
Educational
background and
qualifications
Owned number of
shares in Invalda INVL
Ongoing management positions
Darius Šulnis –
the President of Invalda
INVL
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, 26.41%
of authorised capital
and votes.
Total votes with others
whose votes are
counted together -
86.61%.
The right to acquire
33,483 shares of the
company according to
the concluded share
option agreement
Invalda INVL, AB (code 121304349,
Gynėjų g. 14, Vilnius, Lithuania) –
the President (the main workplace);
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;
FERN Group UAB (code
306110392, Granito g. 3-101,
Vilnius, Lithuania) - Chairman of the
Supervisory 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 (till
30-04-2022);
Litagra, UAB (code 304564478,
Savanorių pr. 173, Vilnius, Lithuania)
– Member of the Board.
Raimondas Rajeckas
CFO
Vilnius University,
Faculty of Economics,
Master of Science in
Accounting and Auditing
Personally: 36,045
units of shares, 0.3%
of authorised capital
and votes.
The right to acquire
120,059 shares of the
company according to
the concluded share
option agreements.
INVL Baltic Real Estate, SUTNTIB
(code 152105644, Gynėjų g. 14,
Vilnius) Member of the Supervisory
Board.
Invalda INVL, AB (code 121304349,
Gynėjų g. 14, Vilnius, Lithuania) CFO
(the main workplace).
Holds the position of director in
companies controlled by Invalda
INVL" (all are located at Gynėjų g 14,
Vilnius):
MD PARTNERS UAB (code
304842899),
Invalda INVL Investments, UAB (code
303252237),
Cedus, UAB (code 302656796),
Cedus Invest, UAB (code 302576631),
Regenus, UAB (code 302575821),
Consult Invalda, UAB (code
302575814)
RPNG, UAB (code 302575892),
MGK invest, UAB (code 302531757),
MBGK, UAB (code 300083611),
Aktyvo, UAB (code 301206846),
Aktyvus valdymas, UAB (code
301673764),
Iniciatyvos fondas VšĮ (code
300657209).
CONSOLIDATED ANNUAL REPORT FOR 2022 | 111
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
(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.
In its activities, the company's audit committee follows the regulations of the audit committee approved by the general
meeting of shareholders on 28 April 2017.
On 30 April 2021 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.
CONSOLIDATED ANNUAL REPORT FOR 2022 | 112
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
-
2013 – 2022 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.
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 company's manager and chief financier are paid a constant monthly salary. The company does not have an approved
policy on the payment of a variable part of the salary to the managers. During 2022, a total of EUR 144 thousand was
accrued to the company's manager and chief financier (including accrued salary in other companies of the company's group),
an average of EUR 6 thousand per month.
Until the general meeting of shareholders held on 30 April 2022, only a fixed monthly salary was paid to the board members
who signed an employment contract with the company. The general meeting of shareholders held on 30 April 2022 elected
the company's board for a new term of office and approved the procedure for remuneration for work on the company's board.
Contracts were concluded with the elected members of the board regarding the activity of the board member and the
remuneration for the work in the Board of Invalda INVL was set (all taxes and fees applicable to the member of the Board,
except for VAT (when the member of the Board becomes liable to pay VAT), inclusive) : (i) the salary of 200 euros per hour
is set for the independent board member, paid at least once a quarter for the hours actually spent by the board member
participating in the board meetings and preparing for the meetings, according to the report of the board member; from 1 May
2022 until 31 December an independent member of the board was paid EUR 8,980 (ii) a monthly fixed remuneration of EUR
1,500 was set for other members of the board, a monthly fixed remuneration of EUR 2,000 for the member of the board
working as the chairman of the board.
In 2022, to the board members, which are shareholders of the Company, were paid EUR 634 thousand of dividends, net of
tax. The entities, which are controlled by the board members and CEO of the company, were paid EUR 4,082 thousand of
CONSOLIDATED ANNUAL REPORT FOR 2022 | 113
dividends, net of tax. Natural persons, who are related to the board members of the company, were paid EUR 1,792 thousand
of dividends, net of tax. There were no assets transferred, no guarantees granted, no bonuses paid and no special pay-outs
made by the company to its managers. The members of the board and CEO were not granted with bonuses by other
companies of Invalda INVL group.
During the year 2022, the total remuneration for the members of the Audit Committee of the company amounted to EUR
2,132.
INFORMATION ABOUT CALCULATED REMUNERATION FOR INVALDA INVL, AB MANAGERS FOR 2022
Calculated remuneration.
thousand EUR
2020
2021
2022
For members of the Board (according to employment contracts
4
as employees of
the company and group companies and for working on the Board of the company in
accordance with the Agreements on the Activities of the Board Member)
251
220
181
For each member of the Board (average per month)
7
6
5
For members of administration (the President and CFO)
4
168
144
144
For each member of administration (average per month)
7.0
6.0
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;
• UAB FMĮ INVL Financial Advisors (Gynėjų str. 14, Vilnius, Lithuania, tel. 8 700 55 959) - wealth management
services contract.
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.
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.
4
Remuneration by the company and group companies (including non-consolidated companies)
CONSOLIDATED ANNUAL REPORT FOR 2022 | 114
Regulatory risk
The main activity of AB Invalda INVL Group is investment management and life insurance. 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.
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
CONSOLIDATED ANNUAL REPORT FOR 2022 | 115
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 2022.
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 to
social responsibility, environment and employees
19.1. RESPONSIBLE BUSINESS ACTIONS IN THE COMPANY
• Ethical business practice
The fundamental basis of ethical norms is the compliance with legal acts and all employees without any exception respect
laws and strictly adhere to them. Employees shall avoid situations that may potentially raise any doubts concerning their
abilities to act for the benefit of the company. or could lead to conflicts of interests. Also employees of the company undertake
not to disclose any confidential information and shall refrain from insider trading in securities in their own name or on behalf
of their members of family or other related persons.
• Information and transparency
The company shall make public all information about the objectives of the company and its activities, financial results,
members of its bodies of management and shareholders, related party transactions, the management structure of the
company. etc. To ensure that information reaches as many users as possible and provide timely access to such information
all this information is uploaded on the website of the company. Such information is simultaneously disclosed to all persons.
The company discloses the information that may potentially affect the price of securities issued thereby in its commentaries.
interview or other ways only after such information is publicly announced through the information system of the stock
exchange.
• Promotion of social initiative
CONSOLIDATED ANNUAL REPORT FOR 2022 | 116
Seeking to implement social initiative promotion programmes in 2007 Invalda INVL established a public enterprise Iniciatyvos
Fondas.
The activities of Iniciatyvos Fondas involve the organisation of different programmes designed to enhance knowledge and
awareness. The priorities defined for the activities of the foundation may differ from year to year while maintaining its key
principle, rather than supporting individual projects, initiate and implement larger-scale integrated projects designed to
encourage individual target groups to take independent initiatives and actively contribute to the growth of the Lithuanian
economy and the development of a responsible and sustainable society.
Extraordinary times call for extraordinary solutions. It is very important for us that the war in Ukraine ends, and a long-term
order is formed, allowing people to live, work and create safely and freely. Therefore, we have decided to temporarily suspend
the development of new programs and direct our attention and funds to the support of organizations doing significant work.
Iniciatyvos Fondas organised and implemented the following programs:
− designed to encourage its participants to independently address different social and environmental problems in specific
locations;
− designed to promote the feeling of responsibility among young people (schoolchildren) and city communities, teach them
to take care of nature and protect environment;
− collecting books from people and donating these book to various libraries;
− designed to promote physical activity of young people (a collective exercise “I’ll grow active 2011” has been recognised
as Lithuanian record).
− to encourage young people to read and desire to excel;
− to encourage positive thinking
More information is provided on the web page of Iniciatyvos fondas www.iniciatyvosfondas.lt
• Ensuring the enforcement of key labour principles and employee social wellbeing
Invalda INVL seeks to operate as a company in which the rights, needs and contribution to the operations of the company
of each employee are properly respected. In recruiting its employees, the company ensures that no employee is
discriminated on the basis of his gender, sexual orientation, race, nationality, language, origin, citizenship or social status,
marital or family status, age, beliefs or views, membership in political parties and public organisations.
The working hours and standards of recreation, conditions for the compensation for work and privileges, safety and health
at work norms fully comply with the requirements stipulated in all relevant legislation.
• Impartial treatment of shareholders and shareholder rights
All shareholders of the company have equal rights to be informed of and participate in passing important decisions related
to the activities of the company. The procedure for convening and organising general meetings of shareholders fully comply
with the relevant provisions of legal acts and ensures equal rights and possibilities for all shareholders to participate in
meetings. having familiarised themselves in advance with draft resolutions on the agenda of the meeting and other
information necessary for passing decisions. and are entitled to pose questions to Members of the Board of Invalda INVL,
AB.
19.2. EMPLOYEES
Average number of employees in 2022 was 7 (in 2021 it was 8), of which the first employer of one employee is UAB INVL
Asset Management. All company’s employees have higher university education.
Number of employees and average monthly salary when the company is the first employer
Measuring units
2020
2021
2022
Total amount of employees as of the end of the period
person
7
7
6
- managers
person
4
4
3
- specialists
person
3
3
3
Average monthly salary (calculated for)
EUR
4,658
4,656
4,523
- managers
EUR
6,489
5,979
5,661
- specialists
EUR
2,195
2,892
3,259
Number of employees in Invalda INVL Group was 287 on 31 December 2022 (459 on 31 December 2021).
CONSOLIDATED ANNUAL REPORT FOR 2022 | 117
19.3. 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.
19.4. REVEALING THE IMPACT OF RUSSIA'S WAR IN UKRAINE
The company has no assets and does not carry out any business operations in Ukraine, Russia and Belarus. The war started
by Russia in Ukraine does not have a direct impact on the issuer's strategic directions, goals, financial results and financial
condition. However, on 1 March 2022, the group company INVL Asset Management suspended the sale, redemption and
exchange of units of the INVL Russia ex-Government Equity Subfundand and the execution of submitted applications. In
May, a decision to cancel (liquidate) INVL Russia ex-Government Equity Subfundand was made.
19.5. ENVIRONMENTAL PROTECTION AND ACTIONS ON CLIMATE CHANGE
INVL Investment Management and Life Insurance Group are integrating the consideration of sustainability risks related to
value creation opportunities into investments decisions. Group aims to incorporate a responsible investment approach and
contribute broadly to societal wellbeing and sustainable development through environmental, social, governance (ESG)
integration, active ownership, exclusions, and commitment to the Principles for Responsible Investment (PRI).
The group companies INVL Asset Management and INVL Life have adopted the Policy of Responsible Investment and
Sustainability Risk Integration. The purpose of this Responsible Investment & Sustainability risk integration policy is to define
the approach companies to integrating the consideration of sustainability risks related to value creation opportunities into
investments decisions. Sustainability work embraces several perspectives and methods which together create value for our
beneficiaries, but also for society at large. Three methods are applied: (i) integration - traditional fundamental analysis is
complimented with ESG consideration; (ii) engagement - we encourage stakeholder partnership and engagement
opportunities that support ESG management in its investment management activities; (iii) exclusion’s method (restricted
sectors ) is designed to avoid activities that may represent an unmanageable and unacceptable investment risk and activities
consider as harmful to society.
The Group manages different types of assets (such as equity, fixed-income, money market and cash equivalents, alternative
investments) through different types of legal forms (such as pension funds, investment funds, private equity, real estate and
alternative funds, investment baskets, discretionary portfolio management, own book investments). The integration of
addressing sustainability risk and principles for particular Fund might depend on the type of assets, strategy, term of
investment. In terms of environmental protection and climate change action, two funds of the INVL group should mentioned:
• INVL Sustainable Timberland and Farmland Fund II - invests in forest and agricultural land in the Baltic States and
Central and Eastern Europe, aiming to manage it sustainably in the long term. The fund’s unlimited duration is at
the core of a long-term sustainability strategy that contributes to the goal of preserving nature. One of the fund’s
very specific goals is to preserve green islands of mosaic landscape and natural habitats for flora and fauna that
may be designated or acquired along with other assets. More information
https://invlsustainable.com/en/sustainability/
• INVL Renewable Energy Fund I - a fund investing in renewable energy technologies in the European Union. By
investing in renewable energy and applying sustainable asset management practices, the fund contributes to the
European Union’s goal of becoming a climate-neutral and circular economy-based continent by 2050. More
information https://invlrenewable.com/en/principles/
19.6. THE FIGHT AGAINST CORRUPTION AND BRIBERY
We adhere to the highest ethical standards in our operations and comply with all applicable laws, rules and regulations aimed
at preventing bribery and corruption. We expect appropriate behaviour from both employees and partners. We must note
that in our activities we did not come across cases of bribery of local or foreign officials.
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.
CONSOLIDATED ANNUAL REPORT FOR 2022 | 118
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.
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 27 of the
consolidated and Company’s financial statements for 2022 explanatory notes.
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 2022 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. INVL Life, a new licensed life insurance company established by Invalda INVL, took over the Baltic life
insurance business. More information https://www.invaldainvl.com/en/regulated-information/invalda-invl-completes-the-
acquisition-of-life-insurance-business-2/
Šiaulių Bankas and Invalda INVL on 22 November 2022 signed an agreement to merge their retail businesses. Once the
deal is completed, Invalda INVL will obtain 62,270,383 units of Šiaulių Bankas shares, which will constitute 9.39 % of the
authorized share capital of Šiaulių Bankas. To finalise the transaction, Šiaulių Bankas will issue a targeted share issue for
CONSOLIDATED ANNUAL REPORT FOR 2022 | 119
purchase by the Invalda INVL group, at the price of EUR 0.645 per share. The equity value of the transaction is EUR 40.2
million.
More information is provided in the section 3 of the consolidated and Company’s financial statements for 2022 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 2022 is presented on the company’s website
www.invaldainvl.com
SUMMARY OF PUBLICLY DISCLOSED INFORMATION
Published
Headline
Message Category
12.01.2022
Invalda INVL increases share capital of its subsidiary INVL Life
and transfers part of shares to it
Other information
20.01.2022
INVL Asset Management, a subsidiary of Invalda INVL, launches
alternative investment fund with a minimum investment of EUR
5,000
Other information
09.02.2022
INVL Baltic Sea Growth Fund acquires Latvian cosmetics
producer B2Y
Other information
09.03.2022
INVL Life, a subsidiary of Invalda INVL, has obtained an
insurance company licence
Notification on material event
30.03.2022
INVL Baltic Sea Growth Fund: InMedica and MediCA Group
completed the largest healthcare clinic merger in Lithuania
Other information
01.04.2022
INVL Asset Management: INVL Partner Global Infrastructure
Fund I reaches first close at just below USD 30 million
Other information
08.04.2022
Audited results of Invalda INVL Group for 2021
Notification on material event
08.04.2022
Draft resolutions prepared by the Board for the shareholders'
meeting of Invalda INVL to be held on 30/04/2022
General meeting of
shareholders
08.04.2022
Convocation of the ordinary general shareholders meeting of
Invalda INVL
General meeting of
shareholders
28.04.2022
The Board of Invalda INVL proposed to allocate dividends for the
year 2021
Notification on material event
28.04.2022
A new draft resolution on item No. 4 and editorial revision on item
No. 10 of the agenda of the shareholders' meeting of Invalda
INVL to be held on 30 April 2022
General meeting of
shareholders
28.04.2022
The shareholders' rights accounting day for the Ordinary General
Shareholders Meeting of Invalda INVL
General meeting of
shareholders
30.04.2022
Ex-day of dividends allocated by the shareholders' meeting of
Invalda INVL held on 30/04/2022
Notification on material event
30.04.2022
Audited annual information of Invalda INVL for 2021
Annual information
30.04.2022
The resolutions of the Ordinary General Shareholders Meeting of
Invalda INVL
General meeting of
shareholders
02.05.2022
Chairman of the Board of Invalda INVL was elected
Notification on material event
06.05.2022
Notification on transactions in the issuer's securities
Notifications on transactions
concluded by managers of the
companies
11.05.2022
Information about shares issued by Invalda INVL and votes
granted
Total number of voting rights
and capital
11.05.2022
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
CONSOLIDATED ANNUAL REPORT FOR 2022 | 120
16.05.2022
Notification about disposal of voting rights of Invalda INVL
Acquisition or disposal of a
block of shares
19.05.2022
Invalda INVL sold the Inservis group
Notification on material event
25.05.2022
Invalda INVL dividend payment procedure for the year 2021
Notification on material event
30.05.2022
Unaudited information of Invalda INVL group for 3 months of
2022
Notification on material event
31.05.2022
Invalda INVL: Notification on transactions in the issuer's
securities
Notifications on transactions
concluded by managers of the
companies
31.05.2022
Invalda INVL signed employee stock option contracts
Notification on material event
03.06.2022
INVL Baltic Sea Growth Fund signs agreement to acquire
“Nemunas” and “Eglės Sanatorija“
Other information
09.06.2022
INVL Baltic Forests Fund I closes with average annual return of
27.3%
Other information
16.06.2022
INVL Partner Global Infrastructure Fund I raises additional USD
8 million
Other information
23.06.2022
INVL Baltic Sea Growth Fund acquired vet clinic network MiniVet
Other information
01.07.2022
Invalda INVL completes the acquisition of life insurance business
Notification on material event
20.07.2022
The alternative investment fund established by INVL Asset
Management, a subsidiary of Invalda, raised EUR 5.5 million
Other information
09.08.2022
INVL fund that invests in forest and land raised an additional EUR
22.9 million
Other information
29.08.2022
One of the largest PET recyclers in Northern Europe backed by
INVL Baltic Sea Growth Fund acquires Czech fibre producer
Other information
31.08.2022
Unaudited information of Invalda INVL group for 6 months of
2022
Interim information
15.09.2022
INVL Baltic Sea Growth Fund-backed PET Baltija completes the
acquisition of a leading Czech fibre producer
Other information
19.09.2022
INVL Partner Global Infrastructure Fund I raised an additional
USD 1.895 million
Other information
23.09.2022
INVL Renewable Energy Fund I is acquiring six solar projects in
Romania
Other information
10.10.2022
INVL Renewable Energy Fund I acquired a 174 MW solar farm
project in Romania
Other information
11.10.2022
INVL Baltic Sea Growth Fund portfolio company invests in
veterinary sector in Poland
Other information
12.10.2022
Invalda INVL has signed a EUR 6.3 million credit line agreement
with Luminor
Other information
22.11.2022
INVL Renewable Energy Fund I raised an additional EUR 18.3
million from investors
Other information
23.11.2022
Invalda INVL and Šiaulių Bankas merge their retail businesses
Notification on material event
30.11.2022
Unaudited information of Invalda INVL group for 9 months of
2022
Interim information
15.12.2022
Moldova-Agroindbank shareholders approved IPO and listing on
Bucharest stock exchange
Other information
19.12.2022
Correction: INVL Partner Global Infrastructure Fund I raised
another USD 1.28 million from investors
Other information
19.12.2022
INVL Partner Global Infrastructure Fund I raised another USD
1.28 million from investors
Other information
21.12.2022
INVL LIFE, a company of Invalda INVL group, sold 0.06% of AB
Šiaulių bankas shares
Other information
23.12.2022
Invalda INVL investor's calendar for 2023
Other information
23.12.2022
INVL Baltic Sea Growth Fund completes the acquisitions of
Nemunas and Eglės Sanatorija
Other information
CONSOLIDATED ANNUAL REPORT FOR 2022 | 121
Summary of reports about transactions concluded in 2022 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
06.05.2022
06.05.2022
R.Rajeckas, CFO of
the issuer
9,086
0.20
Acquisition. Share
subscription agreement
exercising option agreement
of 6 May 2019
Outside a
trading
venue
31.05.2022
31.05.2022
D.Sulnis, CEO of the
issuer
33,483
1.00
Execution of option
agreement to obtain issuer’s
shares in the future under
Rules for Granting Equity
Incentives approved by the
general shareholders’
meeting on 1 July 2020
Outside a
trading
venue
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).
signed with qualified electronic signature
President
Darius Šulnis
CONSOLIDATED ANNUAL REPORT FOR 2022 | 122
APPENDIX 1. INFORMATION ABOUT GROUP COMPANIES, THEIR CONTACT
DETAILS
Company
Registration information
Type of activity
Contact details
INVESTMENT MANAGEMENT AND LIFE INSURANCE 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, alternative
investments
Telephone +370 700
55959
E-mail info@invl.com
www.invl.com
INVL Asset Management,
IPAS (Latvia)
Code 40003605043
Address Kronvalda bulvāris 3-3,
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 Kronvalda bulvāris 3-3,
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 26.02.2015
Administration of
agricultural land
E-mail
juste.gumovskiene@invl.c
om
INVL Financial Advisors,
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, UADB
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
IPPG UAB
Code 301673796
Address Gynėjų str. 14, Vilnius
carries no activity
Telephone +370 5 263
6129
CONSOLIDATED ANNUAL REPORT FOR 2022 | 123
Legal form – private limited
liability company
Registration date 07.04.2008
Ivpi, UAB
Code 305700027
Address Palangos str. 4, Vilnius
Legal form – private limited
liability company
Registration date 17.02.2021
liquidated 29.03.2023
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
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 2022 | 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.
CONSOLIDATED ANNUAL REPORT FOR 2022 | 125
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 extent that their public disclosure is not
detrimental to the company or the company’s commercial
secrets are not revealed.
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
company's website. At the end of
the shareholders' meeting, the
company announces the
adopted resolutions in the same
CONSOLIDATED ANNUAL REPORT FOR 2022 | 126
5
For the purposes of this Code, heads of the administration are the employees of the company who hold top level
management positions.
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.
YES
In accordance with the provisions
of legal acts, the Company must
enable shareholders to
participate in the General
Meeting of Shareholders and
vote by means of electronic
communication, as well as
submit a voting instruction when
it is required by shareholders
whose shares hold at least 1/10
of all votes.
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.
CONSOLIDATED ANNUAL REPORT FOR 2022 | 127
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
APPLICAB
LE
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
APPLICAB
LE
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.
CONSOLIDATED ANNUAL REPORT FOR 2022 | 128
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 management and control
CONSOLIDATED ANNUAL REPORT FOR 2022 | 129
7
Link to the OECD Good Practice Guidance on Internal Controls, Ethics and Compliance: https://www.oecd.org/daf/anti-
bribery/44884389.pdf
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.
CONSOLIDATED ANNUAL REPORT FOR 2022 | 130
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.
YES
Tomas Bubinas was elected as
an independent member of the
board at the company's
shareholders' meeting held on 30
April 2022.
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.
YES
At the company's shareholders'
meeting held on 30 April 2022,
the amounts of remuneration for
work on the board were
approved
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
governance issues would be ensured. Meetings of the company’s
collegial bodies should be convened at least once per quarter.
YES
Board meetings are held at least
once a month according to the
pre-approved schedule.
CONSOLIDATED ANNUAL REPORT FOR 2022 | 131
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).
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 schedule is pre-
approved. The material is
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 acts regulating the processing
CONSOLIDATED ANNUAL REPORT FOR 2022 | 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
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 2022 | 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.
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
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 2022 | 134
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
. The remuneration policy
includes all forms of
remuneration
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
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
CONSOLIDATED ANNUAL REPORT FOR 2022 | 135
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 2022 | 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 2022 | 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
2022 the audit firm did not
provide non audit services
CONSOLIDATED ANNUAL REPORT FOR 2022 | 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 2022. 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 2022 “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 2022.
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 2022.
5. Information about related parties transactions in accordance with Article 37
2
of the Law on Companies of the
Republic of Lithuania
Pursuant to Clause 3 of Article 10 of the Law on Companies, for transactions concluded with a subsidiary company, the
owner of all shares of which is this company, or when the total amount of such transactions during the financial year does
not exceed 1/10 of the asset value specified most recent balance sheet of the company whose shares are allowed to be
traded on the regulated market, the provisions of Article 37 of the Law on Companies do not apply. Since all transactions in
the Company are loans with subsidiaries or they do not exceed 1/10 of its assets, the information of such transactions is not
detailed.
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 2022.
CONSOLIDATED ANNUAL REPORT FOR 2022 | 139
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 2022.
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 Committee in Clause 13 of the consolidated annual report for 2022.
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 2022.
13. Information about all agreements between shareholders (their essence, conditions).
Information is disclosed in Clause 9 of the consolidated annual report for 2022.
CONSOLIDATED ANNUAL REPORT FOR 2022 | 140
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 investment management and life insurance group whose companies more than 300 thousand clients
have entrusted over 1.9 billion euros of assets.
At the end of 2022, equity of Invalda INVL amounted to EUR 130.8 million or EUR 11.07 per share - these indicators were
respectively 14.24% and 13.53% higher than a year ago (also taking into account EUR 7.7 million dividends that were paid
to shareholders). The increased value of investments in the last quarter of the year led to the fact that the activities of Invalda
INVL were profitable last year - a net profit of EUR 16.67 million was obtained.
We work purposefully, and we are ready for changes when they are necessary and meaningful. As we planned, in the middle
of last year we successfully completed the acquisition of Mandatum Life's life insurance business in the Baltic States. We
acquired this business in order to create a group that can offer existing and new INVL customers even more products and
solutions that meet their needs. Due to favourable circumstances, we did not have time to fully complete this and integrate
the life insurance business into INVL. On 22 November 2022 we signed an agreement with Šiaulių Bankas regarding the
merger of part of the retail businesses. After the closing of the transaction, the Šiaulių Bankas group, in addition to the
financial services it already offers, will manage second-and third-pillar pension funds and mutual funds in Lithuania and will
provide life insurance services. We will have up to 20% of Šiaulių Bankas shares and thus remain in this business.In 2022.
The average number of employees of AB Invalda INVL was 6, of which 3 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.
During the reporting period, the company's board changed. The meeting of shareholders of the company held on 30 April
2022 elected the members of the board for a new term of 4 (four) years and approved the amounts of remuneration for the
work on the board.
.
CONSOLIDATED ANNUAL REPORT FOR 2022 | 141
Table 1. Remuneration of the CEO, CFO and each member of the bodies elected by the specific shareholders' meeting for 2021 and 2022 (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
2021
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
2022
Darius Šulnis,
CEO, Board
member (till
30.04.2022)
73,433
73,398
-
372,315*
-
-
-
-
1,366
-
74,799
445,713
98%
16%
-
Alvydas Banys,
Senior Advisor (till
30.04.2022),
Chairman of the
Board
73,429
73,406
-
-
-
-
-
-
-
-
73,429
73,406
100%
100%
-
33,000
Indrė Mišeikytė,
Advisor, Board
member
73,389
73,840
-
-
-
-
-
-
-
73,389
73,840
100%
100%
-
Tomas Bubinas,
independent audit
committee
member, since
30.04.2022
independent
Board member
508
10,575**
-
-
-
-
-
-
508
10,575
100%
100%
-
Danguolė
Pranckėnienė,
independent audit
committee
member
580
537
-
-
-
-
-
-
-
580
537
100%
100%
-
Raimondas
Rajeckas,
CFO
58,037
58,099
7,296
5,100
23,701
23,701
-
-
31,693
32,228
120,727
119,128
48%
49%
3,550
3,616
* An option contract was concluded, which granted the right to choose to receive up to 33,483 shares of Invalda INVL no earlier than after 3 years (i.e. 2025).
** New duties have been started in the company, for which remuneration determined by the shareholders' meeting is paid.
CONSOLIDATED ANNUAL REPORT FOR 2021 | 142
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
2018
2019
2020
2021
2022
Šulnis Darius
4.6%
2.1%
-24.3%
-29.6%
507.0%*
Mišeikytė Indrė
-0.3%
0.8%
1.9%
-2.2%
0.6%
Banys Alvydas
0.3%
-0.8%
0.5%
-0.2%
0.0%
Rajeckas Raimondas
-3.0%
15.3%
28.9%
-3.7%
-1.3%
Tomas Bubinas
37.5%
150.9%
-54.7%
-44.0%
1,983.7%**
Dangutė Pranckėnienė
-75.8%
33.3%
-7.5%
Net profit
-97.0%
5,972.0%
-74.4%
602.8%
-55.5%
Average salary
32.0%
29.8%
17.4%
31.8%
12.7%
* Increase due to concluded option contract, which granted the right to choose to receive up to 33,483 shares of Invalda
INVL no earlier than after 3 years (i.e. 2025).
** Increase due to new duties started in the company, for which remuneration determined by the shareholders' meeting is
paid.
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 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 2022 | 143
Table 3. Share options
Option
owners
The number of
securities in 2022
approved by the
shareholders'
meeting for
options
Securities for which option agreements
were concluded in 2022
2022 exercised options (agreed in
2019)
number
agreed
purchase
price
year of
acquisition
of shares
Number of
securities
purchased by
employees
Method of
granting of
securities
Employees
5
50,000
40,862
EUR 1
2025
69,479
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 to the CFO of the
company, therefore the details of the stock options granted only to the CFO are given below, and in 30.05.2022 options were
assigned to CEO of the company Darius Šulnis. The expiration date of these options is 2025, the purchase price of shares
is EUR 1, 33,483 units have been granted, the value of the granted option and costs are EUR 372,315.
Table 4. Unexercised stock options for the company's CFO
6
The exercise price of the share options of the company granted in 2019 has not exceed EUR 0.20 due to the payment of
dividends of EUR 0.8 per share. The exercise price of the share options of the company granted in 2020 will not exceed
EUR 0.35 due to the payment of dividends of EUR 0.65 per share
7
Value of exercised stock options is EUR 109,941. Share price on exercise date was EUR 12.30. 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
7
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
1.45 till now)
116,105
-
-
116,105
-
23,701
Total
129,144
-
-
120,059
-
23,701