2022 ANNUAL REPORT
Registration number: CVR no. 29801843
01.01.2022-31.12.2022
2022
ANNUAL
REPORT
2022 ANNUAL REPORT
PAGE 1
WE ARE
FARMERS AND
AGRIBUSINESS
MANAGERS
CONTENTS
Business Highlights 2
Financial Review 4
The Share 7
Corporate Social Responsibility 8
Financial History 11
Consolidated Financial Statements 12
Consolidated Balance Sheet 12
Consolidated Income Statement 13
Consolidated Statement of Comprehensive Income 14
Consolidated Statement of Changes in Equity 15
Consolidated Statement of Cash Flow 16
Contents of Notes to the Consolidated Financial Statements 17
Notes to the Consolidated Financial Statements 18
Financial Statements of the Parent Company 60
Management´s Statement 72
Independent Auditor´s Report 73
Definitions 76
2022 ANNUAL REPORT
PAGE 2
BUSINESS HIGHLIGHTS
* Indicators exclude effect of recycled currency translation losses, related to subsidiaries disposed
** 12m 2022 and 12m 2021 were influenced by disposal of two unprofitable clusters respectively. Thus, historic currency translation
losses were recycled from Other Comprehensive Income to Income Statement.
• On 24 February 2022 russia started a war
against Ukraine. Armed forces of Ukraine
continue successful resistance to the russian
army and have already liberated 50 % of the
formerly occupied territory.
• Agromino stays resilient despite the war and
continues with production and delivery of
commodities to its clients.
• In spite of the complicated war time Agromino
group reached EBITDA profit from operational
activity of USD 12.0 million and net loss of
USD 0.7 million for 2022.
• Due to milk cluster disposal in 2022, historical
currency translation losses of USD 10.5 million
were recycled to the Income Statement from
Other Comprehensive Income. This
divestment was the last part of the planned
restructuring of Group’s assets and included
sale of two unprofitable clusters in 2021 and
2022.
• Including impact of currency translation losses
from milk cluster disposal, Group’s EBITDA
profit equals USD 1.5 million and net loss
equals USD 11.2 million.
• At the end of 2022, Agromino had cash in
amount USD 0.7 million and grain for sale in
amount USD 25.8 million, that are further
being transferred into cash. Additionally, all
credit limits existing in 2022 remained to be
available for the Group in 2023.
• Out of 42 thousand hectares cultivated by
Agromino, 16.6 thousand hectares located in
Kharkiv region were occupied since February
2022. In September 2022 these territories
were liberated and Agromino regained control
of this land in October. Agromino estimates
damages from invasion as follows:
- Loss in net cash inflow from grain sales:
USD 4.5 million. Losses included 2 parts:
discount in prices for grain in Ukrainian
ports after the war started in comparison
with more safe ports. Increase in logistic
cost to ports after the war started due to
11,2
20,1
31,1
12,0
2,9 1,2
18,7
- 0,7
MUSD
EBITDA*
NET PROFIT/LOSS*
12m 2019
12m 2020
12m 2021
12m 2022
11,2
20,1
23,3
1,52,9 1,2 10,9
- 11,2
- -
- 7,8
- 10,5
MUSD
EBITDA
NET PROFIT/LOSS
Historic currency translation
recycled**
12m 2019
12m 2020
12m 2021
12m 2022
2022 ANNUAL REPORT
PAGE 3
slowdown in speed of wagons, increasing
tariffs for using wagons.
- Unrealized profit from unsown or
unharvested fields: USD 11.6 million. Basis
for calculation – planned income and costs,
including those already incurred.
- Grain for sale lost: USD 0.5 million. Current
market value was considered as basis for
estimation.
- Real estate, machinery and inventories:
USD 0.8 million. Estimation was made
based on market and balance values.
The Group registers all the damages from
russian aggression, and intends to cooperate
with external appraiser.
• Agromino had autumn 2022 sowing plan for
3.9 thousand ha in Vovchansk region, earlier
occupied. Only 1.9 thousand ha were sown
because russian aggression resulted in
absence of technical possibilities to complete
sowing plan (security situation, limited time,
machinery and other sources).
• In response to the war the business processes
have been reorganized to cope with existing
challenges and to secure continuity of the
Group’s activities.
• Agromino has built strong logistics including
railway transportation routes in 2022 after
suspension of Black Sea ports. Agromino grain
is being supplied mostly to Germany and Italy,
thus spring 2023 prohibition of Ukrainian grain
import to the nearest countries have not
affected Group operations significantly.
• Since August 2022 Agromino devoted part of
its logistic capacities to other farmers and
implemented new business line in its
operations – trading of third parties’ grain.
Decision to start this activity was made not
only from economic point of view but also to
help eastern farmers who suffered the most
from consequences of war.
• In 2022 Agromino has replaced part of corn
acreage by mustard and other crops not so
intensive in fertilizers, drying and
transportation costs.
• Agromino cares for its employees and provides
help and support for them. The group provides
its employees serving in Ukrainian Armed
Forces with equipment, keeps their working
places and continued paying their salaries.
Agromino has also continued to pay salaries to
employees on occupied territories, despite its
operations were blocked there.
• Agromino supports Ukraine both in
humanitarian and defense aspects by:
- supporting Armed Forces of Ukraine and
Forces of Territory Defense on local level;
- organizing charity dinners and auctions to
raise funds in favor of Armed Forces;
- active work with mass media;
- developing business cooperation and
promoting Ukraine as perspective EU
member and market.
Thus, during war Agromino has provided help
to Ukraine in specific numbers below:
- UAH 2.57 billion were raised to account of
the Embassy of Ukraine in the Czech
Republic, supported by Agromino through
Freedom for Ukraine Initiative (data as of
31.01.2023);
- UAH 42 million were raised at charity
auction;
- UAH 20 million were donated by Agromino
to Armed Forces of Ukraine;
- 12 automobiles, more than 6 000 liters of
fuel, above 1000 of bulletproof vests,
sleeping bags and other things were
provided by Agromino.
2022 ANNUAL REPORT
PAGE 4
FINANCIAL REVIEW
The Group’s operations include Ukraine
cereals (including storage and trading) and
milk production.
Total revenue, other income and
gain/loss of biological assets
Total revenue, other income and gain/loss of
biological assets of the Group for 2022 at USD
40.1 million compared to USD 44.8 million for
2021.
Changes in biological assets/inventories
The current biological assets as of the year end
consist of winter crops sown for 2023 harvest
and corn unharvested on 141 ha. Area under
winter crops was 9 314 ha as of December 31,
2022 (12 441 ha as of December 31, 2021).
Expenses
OPEX 2022 in comparison to OPEX 2021 is
specified in diagram below.
Net result
Agromino reached EBITDA profit from
operational activity of USD 12.0 million and net
loss of USD 0.7 million for 2022.
Due to milk cluster disposal in 2022, historical
currency translation losses of USD 10.5 million
were recycled to the Income Statement from
Other Comprehensive Income. This divestment
was the last part of the planned restructuring
of Group’s assets and included sale of two
unprofitable clusters in 2021 and 2022.
Including impact of currency translation losses
from milk cluster disposal, Agromino recorded
EBITDA profit of USD 1.5 million and net loss
of USD 11.2 million in 2022.
Assets
The consolidated assets of the Group as of
December 31, 2022, amounted to USD 105,3
million (USD 111.2 million at December 31,
2021).
Fixed assets
Property, plant and equipment as of December
31, 2022, in the amount of USD 19.0 million
accounted for 18% of the total assets,
comprising of land, buildings, machinery,
equipment and construction in progress.
Decrease in fixed assets by USD 6.3 million as
at December 31, 2022 compared to December
31, 2021 was caused by depreciation of UAH to
USD. No relevant significant real disposals
happened.
Right-of-use assets include land right-of-use
asset recognized under IFRS 16 and Land
usage rights from business acquisition of
Resilient in the end of the year 2019. Right-of
use assets equaled USD 19.4 million or 18 % in
total assets as of December 31, 2022.
Total land under control as at December 31,
2022 was around 42 thousand hectares. During
year 2022, the Group disposed of one milk
segment with land in ownership amounting to
approximately 2.5 thousand hectares. In
Ukraine, the land is covered with mostly
medium to long-term land lease contracts.
There is 1.7 thousand hectares in ownership.
0 2 4 6 8 10 12
Seeds, fertilizers, chemicals
Employee benefits expense
Land tax and land rental
Animal feed
Repairs
Fuel, gas, electricity
Transportation, other services and materials
Office and administration expenses
Legal and consulting fees
Other expenses
OPEX (MUSD)
2022
2021
0
10
20
30
40
50
LAND IN UKRAINE
(Thousand hectares)
31.12.2020 31.12.2021 31.12.2022
2022 ANNUAL REPORT
PAGE 5
Inventories and biological assets
As of December 31, 2022, the inventories stood
at USD 32.7 million (USD 30.9 million as of
December 31, 2021).
Biological assets of USD 5.8 million as of
December 31, 2022, comprised of the dairy
herd, grasslands, winter crops seeded for 2023
harvest and corn unharvested in the field. Fair
value of biological assets sown for next year
harvest is determined by present valuing the
net cash flows expected to be generated from
the assets discounted at average cost of short-
term financing.
Assets classified as held for sale and
Liabilities associated
As of December 31, 2021 assets of subsidiaries
in LLC Trigon Moloko and LLC Dobruchi-2 were
classified as assets held for sale, since
Management of the Group had intentions to sell
that milk production segment and assessment of
the sale could be considered as highly probable.
As of December 31, 2021 the Group classified
also liabilities as associated with assets held for
sale in the amount USD 0.4 million in regards of
subsidiaries to be disposed.
In 2022 it was disposed out of the Group.
Liabilities and equity
Borrowings
The total borrowings of the Group as of
December 31, 2022, amounted to USD 14.9
million (USD 0.7 million as at December 31,
2021).
Equity
The total number of shares with par value of 0.10
EUR in the Company equaled to 74,685,369 as
of December 31, 2022.
Lease liabilities
Lease liabilities include current and non-current
lease liabilities recognized under IFRS 16
adoption by the Group.
Property,
plant and
equipment
Prepayments
, receivables
and other
assets
Right-of-
use asset
Inventories
Biological assets
Equity
Borrowings
Lease
liability
Other
liabilities
Cash
0%
20%
40%
60%
80%
100%
Assets Equity and liabilities
BALANCE SHEET STRUCTURE 31.12.2022
Property,
plant and
equipment
Prepayments,
receivables
and other
assets
Assets classified as held
for sale
Right-of-
use asset
Inventories
Biological assets
Equity
…
Lease
liability
Other liabilities
Cash
0%
20%
40%
60%
80%
100%
Assets Equity and liabilities
BALANCE SHEET STRUCTURE 31.12.2021
2022 ANNUAL REPORT
PAGE 6
CEREAL PRODUCTION
The Group has its cereals production
operations in the black earth regions in
Kharkov, Kirovograd, Bila Tserkva, Zhytomyr,
and Khmelnytsky.
The revenue is made up primarily from sales
of own produced cereals.
The fair value of biological assets as at
December 31, 2022 has been determined by
valuing the discounted net cash flows
expected to be generated from the assets.
Harvested hectares
2018
2019*
2020
2021**
2022E***
Wheat
20 987
16 124
18 875
8 009
9 706
Sunflower
14 745
12 910
14 084
14 202
7 369
Rapeseed
1 822
2 137
2 808
1 567
1 971
Corn
1 013
4 727
11 504
10 315
3 257
Barley
261
61
-
Soya
2 537
6 001
1 016
3 505
2 741
Other
3 447
3 479
2 421
4 266
4 256
Total
44 551
45 378
50 969
41 925
29 300
Net production, t
2018
2019*
2020
2021**
2022E***
Wheat
65 940
61 650
90 998
40 440
42 611
Sunflower
34 747
34 934
34 410
43 796
20 914
Rapeseed
1 850
3 429
6 695
3 865
5 933
Corn
6 253
38 659
64 392
80 161
21 784
Barley
-
-
1 255
221
-
Soya
4 954
11 048
2 182
8 624
4 880
Other
6 788
10 810
8 910
14 134
6 129
Total
120 532
160 530
208 842
191 241
102 251
Net yield, t/ha
2018
2019*
2020
2021**
2022E***
Wheat
3.14
3.82
4.82
5.05
4.39
Sunflower
2.36
2.71
2.44
3.08
2.84
Rapeseed
1.02
1.60
2.38
2.47
3.01
Corn
6.17
8.18
5.60
7.77
6.69
Barley
-
-
4.80
3.62
-
Soya
1.95
1.84
2.15
2.46
1.78
Other
1.97
3.11
3.68
3.31
1.44
Total
2.70
3.54
4.10
4.56
3.49
* Resilient harvesting was included since October 17, 2019.
** Nikolaev and Gorodylovychi harvesting was excluded since April 2021
*** Decrease by unharvested hectares due to occupation (only part of them could be harvested)
Additional information: Hectares in crops production only (milk production excluded)
1,02
1,60
2,38
2,47
3,01
3,14
3,82
4,82
5,05
4,39
2,36
2,71
2,44
3,08
2,84
6,17
8,18
5,60
7,77
6,69
1,95
1,84
2,15
2,46
1,78
0,00
1,00
2,00
3,00
4,00
5,00
6,00
7,00
8,00
9,00
2018 2019 2020 2021 2022
CROP NET YIELDS, t/ha
Rapeseed Wheat Sunflower Corn Soya
2022 ANNUAL REPORT
PAGE 7
Sales of grain and oilseeds (2022 and 2021 crop, 3rd party)
2022
Tonnes
Own
produced,
USD
thousand
Price*
USD/t
Tonnes
Third
party,
USD
thousand
Price
USD/t
Tonnes
Total
Revenue,
USD
thousand
Price
USD/t
Wheat
12 964
4 524
349
1 483
529
357
14 447
5 053
350
Barley
3
-
81
-
-
-
3
-
81
Sunflower
4 091
2 862
700
-
-
-
4 091
2 862
700
Corn
53 709
13 203
246
10 117
3 402
336
63 826
16 605
260
Rapeseed
1 403
892
636
-
-
-
1 403
892
636
Soya
5 129
2 928
571
481
265
551
5 610
3 193
569
Millet
5 457
1 453
266
-
-
-
5 457
1 453
266
Canary
225
158
700
-
-
-
225
158
700
Pea
732
227
310
-
-
-
732
227
310
Mustard
1 356
2 112
1 558
-
-
-
1 356
2 112
1 558
Other
838
953
1 137
-
-
-
838
953
1 137
Total
85 907
29 312
341
12 081
4 196
347
97 988
33 508
342
Sales of grain and oilseeds (2021 and 2020 crop, 3rd party)
2021
Tonnes
Own
produced,
USD
thousand
Price*
USD/t
Tonnes
Third
party,
USD
thousand
Price
USD/t
Tonnes
Total
Revenue,
USD
thousand
Price
USD/t
Wheat
38 161
9 002
236
-
-
-
38 161
9 002
236
Barley
56
9
161
-
-
-
56
9
161
Sunflower
40 158
22 209
553
-
-
-
40 158
22 209
553
Corn
25 653
6 021
235
-
-
-
25 653
6 021
235
Rapeseed
3 905
2 409
617
-
-
-
3 905
2 409
617
Soya
3 013
1 827
606
-
-
-
3 013
1 827
606
Millet
10 194
2 525
248
-
-
-
10 194
2 525
248
Canary
374
236
631
-
-
-
374
236
631
Pea
2 716
722
266
-
-
-
2 716
722
266
Other
283
37
131
-
-
-
283
37
131
Total
124 513
44 997
361
-
-
-
124 513
44 997
361
All prices exclude VAT, Domestic sales are ex elevator and export sales are CPT
THE SHARE
Share information
Major shareholders as at 31.12.2022
Country
No of shares
(thousands)
No of votes
(thousands)
MABON investiční fond s p.z.k.
Czech Republic
74 685
74 685
Total number
74 685
74 685
As at July 3, 2023 Mabon investiční fond s p.z.k. owns 74 685 thousands shares and holds the same
number of votes.
2022 ANNUAL REPORT
PAGE 8
CORPORATE SOCIAL RESPONSIBILITY
2022 ANNUAL REPORT
PAGE 9
2022 ANNUAL REPORT
PAGE 10
2022 ANNUAL REPORT
PAGE 11
FINANCIAL HISTORY
Income statement, USD thousand
2018
2019
2020
2021
2022
Revenue from continuing operations
29 863
39 880
58 894
47 850
35 616
Total revenue, other income and fair
value adjustments from continuing
operations
31 144
43 403
57 368
44 784
40 076
EBIT from continuing operations
-10 943
6 630
13 091
16 090
-4 618
Net financials from continuing
operations
-1 299
-3 560
-10 636
-4 849
-6 503
Net profit/loss
-11 281
2 980
1 163
10 870
-11 204
EBITDA
-8 980
11 177
20 132
23 338
1 510
Currency translation difference
recycled from Other Comprehensive
Income to Income Statement in
relation to disposal of subsidiaries
-11 788
-
-
-7 789
-10 484
EBITDA, excluding currency translation
difference recycled effect
2 807
11 177
20 132
31 127
11 994
Balance sheet, USD thousand
31.12.2018
1
31.12.2019
31.12.2020
31.12.2021
31.12.2022
Total assets
53 480
126 845
99 946
111 186
105 291
incl Non-current assets
29 176
87 356
73 544
69 262
52 219
incl Property, plant and equipment
14 437
29 565
26 345
24 545
19 008
Investment in property, plant and
equipment
2 955
5 602
7 247
4 407
5 302
Net debt (including accrued interest)
-12 177
-16 779
3 788
786
-14 185
Total equity
36 747
59 135
53 422
87 175
68 380
Cash flow statement, USD
thousand
2018
1
2019
2020
2021
2022
Cash flows from operating activities
1 973
12 440
31 042
9 429
-8 782
Cash flows from investing activities
320
-7 041
-369
-6 961
627
Cash flows from financing activities
-3 474
-6 429
-25 060
-8 374
6 444
Effects of exchange rate changes
25
2 372
98
70
950
Cash and cash equivalents at
beginning of period
2 015
803
2 134
7 393
1 456
Cash and cash equivalents at end of
period
803
2 134
7 393
1 456
695
Key figures
31.12.2018
1
31.12.2019
31.12.2020
31.12.2021
31.12.2022
Number of shares, end of the period
(adjusted for reversed share split)
17 421 313
24 895 123
24 895 123
74 685 369
74 685 369
Total number of employees
735
1 028
923
Land under control, thousand hectares
47,1
55,3
54,5
44,8
42,3
Ratios
2018
1
2019
2020
2021
2022
Earnings per share (EPS), USD
(adjusted for reversed share split)
-0,64
0,16
0,05
0,15
-0,15
Book value per share, USD (adjusted
for reversed share split)
2,09
2,36
2,13
1,17
0,92
Return on assets (ROA)
-20%
3%
1%
10%
-10%
Return on equity (ROE)
-30%
6%
2%
16%
-14%
Equity ratio, %
69%
47%
54%
79%
65%
Current ratio
1,58
1,32
1,24
4,60
2,44
Acid test
0,41
0,36
0,54
1,03
0,7
For definitions of the ratios please refer to page 76.
2022 ANNUAL REPORT
PAGE 12
CONSOLIDATED FINANCIAL STATEMENTS
CONSOLIDATED BALANCE SHEET
in USD thousand
Note
31.12.2022
31.12.2021
ASSETS
Current assets
Cash and cash equivalents
5,7
Trade and other receivables
6,7
Inventories
8
Biological assets
9
Assets held for sale
Current assets
Prepaid land rents and land usage
rights
12
Other non-current prepayments and
receivables
6,7
Biological assets
9
Intangible assets
10
Property, plant and equipment
11
Right-of-use asset
22
Assets classified as held for sale
31
Non-current assets
Total assets
LIABILITIES
Trade and other payables
7,13
Borrowings
7,14
Current portion of lease liability
22
Liabilities associated with assets classified
as held for sale
31
Current liabilities
Trade and other payables
7,13
Borrowings
7,14
Lease liability
22
Deferred tax liabilities
16
Non-current liabilities
Total liabilities
EQUITY
Ordinary shares
17
Share premium
17
Other reserves
18
-59 474
-51 881
Accumulated deficit
Capital and reserves attributable to
equity holders of the Group
Non-controlling interest in equity
-29
-31
Total equity
Total equity and liabilities
The notes on pages 18 to 59 are an integral part of these consolidated financial statements.
2022 ANNUAL REPORT
PAGE 13
CONSOLIDATED INCOME STATEMENT
in USD thousand
Note
2022
2021
Continuing operations:
Revenue
19
Other income
19
Gain/loss of biological assets arising from changes in fair value less cost to
sell
9
-3 580
Total revenue, other income and fair value adjustments
Net changes in inventories of agricultural produce and work in
process
8
Cost of purchased goods for trading purposes
-1 650
-325
Raw materials and consumables used for production purposes
20
-29 799
-25 864
Employee benefits expense
21
-5 698
-7 296
Depreciation and amortization
-5 948
-6 544
Other administrative expenses
23
-1 561
-1 877
Other (losses)/gains - net
24
-9 222
-7 100
-4 618
Gains/losses from exchange rate differences
-2 883
Finance income
25
Finance costs
25
-3 775
-5 755
Profit/loss before income tax
-11 121
Corporate income tax (expense)/profit
15
-144
-197
Profit/loss for the period from continuing operations
-11 265
Discontinued operations
Profit/Loss for the period from discontinued operations
31
-174
Profit/Loss for the period
-11 204
Attributable to:
Equity holders of the Company
-11 204
Non-controlling interest
-11 204
Profit/loss per share for profit/loss attributable to the equity
holders of the Company during the period (expressed in USD per
share)
-0.15
The notes on pages 18 to 59 are an integral part of these consolidated financial statements.
2022 ANNUAL REPORT
PAGE 14
CONSOLIDATED STATEMENT OF
COMPREHENSIVE INCOME
in USD thousand
2022
2021
Profit/Loss for the period
-11 204
Other comprehensive income:
Items that will not be reclassified to profit or loss
Gain/Loss from revaluation of land of continuing operations
11,18
-8
Items that may be subsequently reclassified to profit or loss
Currency translation differences (Note 3.1.1.(i))
18
-18 077
Currency translation difference recycled from Other Comprehensive Income to
Income Statement in relation to disposal of subsidiary
Other comprehensive expense/income for the period; net of tax
-7 593
Total comprehensive income/expense for the period
-18 797
Attributable to:
Equity holders of the Company
-18 797
Non-controlling interest
Total comprehensive income/expense for the period
-18 797
The notes on pages 18 to 59 are an integral part of these consolidated financial statements.
2022 ANNUAL REPORT
PAGE 15
CONSOLIDATED STATEMENT OF CHANGES IN
EQUITY
Attributable to equity holders of the Company
in USD thousand
Share
capital
Share
premium
Other
reserves
Accumulated
deficit
Total
Non-
controlling
interest
Total
Equity
Balance at 31.12.2020
1
-60 629
-85 606
Profit/loss for the period
Other Comprehensive Income
recycled to Income Statement in
relation to disposal of subsidiary
Other comprehensive income
Total comprehensive income
Shares nominal value decrease
(Note 17)
-25 255
Issuance of share capital (Note
17)
Transfer between equity
elements (Note 17)
-87 155
-454
Balance at 31.12.2021
-51 881
-31
Profit/loss for the period
-11 204
-11 204
Other Comprehensive Income
recycled to Income Statement in
relation to disposal of subsidiary
Other comprehensive income
-18 077
-18 077
-18 077
Total comprehensive income
-7 593
-11 204
-18 797
-18 795
Balance at 31.12.2022
-59 474
-29
The notes on pages 18 to 59 are an integral part of these consolidated financial statements.
1
recalculated due to change in presentation currency. See Note 2.2.(c)
2022 ANNUAL REPORT
PAGE 16
CONSOLIDATED STATEMENT OF CASH FLOW
in USD thousands
Note
2022
2021
Cash flows from operating activities
Cash receipts from customers
Cash paid to suppliers and employees
-45 503
-45 480
Income tax paid
15
-94
-145
Subsidies received
Interest received
25
Net cash used in/generated from operating activities
-8 782
Cash flows from investing activities
Disposal of subsidiary, net of cash disposed of
Purchase of property, plant and equipment
11
-1 490
-13 223
Proceeds from sales of property, plant and equipment
11
Net cash generated from investing activities
-6 961
Cash flows from financing activities
Proceeds from new shares issued
Proceeds from borrowings
14
Repayments of borrowings
14
-9 623
-12 377
Repayments of lease liabilities
14
-922
-1 193
Repayments of land lease liabilities
-2 388
-4 463
Interest paid
25
-549
-281
Proceeds and repayments of loans with related parties
-2 352
-15 113
Other movement
Net cash used in financing activities
-8 374
Net decrease/increase in cash and cash equivalents
-1 711
-5 906
Effects of exchange rate changes on cash and cash equivalents
Classified as held for sale
-101
Cash and cash equivalents at beginning of period
5
Cash and cash equivalents at end of period
5
The notes on pages 18 to 59 are an integral part of these consolidated financial statements.
1
recalculated due to change in presentation currency. See Note 2.2.(c)
2022 ANNUAL REPORT
PAGE 17
CONTENTS OF NOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS
1. General information ..................................................................................................... 18
2. Summary of significant accounting policies ..................................................................... 18
3. Financial risk management ........................................................................................... 29
4. Critical Accounting Estimates and Judgments .................................................................. 31
5. Cash and cash equivalents ............................................................................................ 34
6. Trade and other receivables .......................................................................................... 35
7. Financial instruments by category .................................................................................. 37
8. Inventories ................................................................................................................. 37
9. Biological assets .......................................................................................................... 38
10. Intangible assets ....................................................................................................... 40
11. Property, plant and equipment .................................................................................... 41
12. Prepaid land rents and land usage rights ...................................................................... 43
13. Trade and other payables ........................................................................................... 43
14. Borrowings ............................................................................................................... 44
15. Income tax ............................................................................................................... 46
16. Deferred tax.............................................................................................................. 47
17. Share capital ............................................................................................................. 48
18. Other reserves .......................................................................................................... 49
19. Revenue and other income .......................................................................................... 49
20. Raw materials and consumables used for production purposes ........................................ 50
21. Employee benefits expense ......................................................................................... 50
22. RIGHT-OF-USE ASSET AND LEASE LIABILITY ................................................................ 50
23. Other administrative expenses .................................................................................... 52
24. Other (losses)/gains-net ............................................................................................. 52
25. Finance income and finance cost .................................................................................. 52
26. Contingencies ............................................................................................................ 52
27. Commitments............................................................................................................ 53
28. Group structure ......................................................................................................... 54
29. Related party transactions .......................................................................................... 55
30. Fees to the auditors appointed by the shareholders ........................................................ 56
31. Assets held for sale and liabilities associated ................................................................. 56
32. Disposal of Subsidiaries .............................................................................................. 58
33. Events after the balance sheet date ............................................................................. 59
2022 ANNUAL REPORT
PAGE 18
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS
1. GENERAL INFORMATION
Agromino A/S (The Company) is an integrated
soft commodities producer (operating
commercial cereals and dairy farms), storage
provider and trader with operations in Ukraine
(no farms etc. are in the Czech Republic).
The parent company is a limited liability
company incorporated and domiciled in
Denmark. The address of its registered office is
c/o Advokatfirmaet Poul Schmith, Kalvebod
Brygge 32, DK-1560, Copenhagen, Denmark.
The company listed its shares on the Stockholm
First North Stock Exchange on May 18, 2007.
From December 8, 2010, the company’s shares
have been traded on the main market Small
Cap segment on NASDAQ Stockholm.
On 15 July 2020, Agromino announced its plan
to apply for delisting of Agromino’s shares. On
19 October 2020, Nasdaq Stockholm has
approved such application. The last day of
trading of Agromino’s shares was 30 October
2020. The Group’s owners were legal and
physical persons. On August 13, 2021 Mabon
has been registered in the shareholders’
register as the sole owner of all shares in
Agromino A/S.
These financial statements were authorised for
issue by the Board of Directors on July 3, 2023.
2. SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES
The principal accounting policies applied in the
preparation of these financial statements are
set out below. The policies have been
consistently applied to all the years presented
unless otherwise stated.
2.1 BASIS OF PREPARATION
This consolidated financial information of
Agromino A/S for 2022 ended December 31,
2022, has been prepared in accordance with
International Financial Reporting Standards
(IFRS) as adopted by the European Union and
further requirements in the Danish Financial
Statements Act. The consolidated financial
statements have been prepared under the
historical cost convention, as modified by the
revaluation of biological assets and land.
The reporting period of the consolidated
financial statements is the calendar year.
The Company prepares its separate financial
statements in accordance with IFRS as adopted
by the European Union and the further
requirements in the Danish Financial
Statements Act. Parent company financial
statements are presented after notes to the
consolidated financial statements in the same
set of financial statements.
The preparation of financial statements in
conformity with IFRS requires the use of certain
critical accounting estimates. It also requires
management to exercise its judgment in the
process of applying the Group’s accounting
policies. The areas involving a higher degree of
judgment or complexity, or areas where
assumptions and estimates are significant to
the consolidated financial statements are
disclosed in Note 4.
ADOPTION OF NEW OR REVISED STANDARDS
AND INTERPRETATIONS
New and amended IFRS Standards that are
effective for the current year
In the current year, the Group has applied a
number of amendments to IFRS Standards and
Interpretations issued by the IASB that are
effective for an annual period that begins on or
after 1 January 2022.
− Amendments to IAS 16 – Property,
Plant and Equipment: Proceeds before
Intended Use
− Amendments to IAS 37 – Onerous
Contracts – Costs of Fulfilling a
Contract
− Annual Improvements to IFRS
Standards 2018–2020
2022 ANNUAL REPORT
PAGE 19
− Amendments to IFRS 3 – Reference to
the Conceptual Framework
The Group has not early adopted any other
standard, interpretation or amendment that
has been issued but is not yet effective.
Their adoption has not had any material impact
on the disclosures or on the amounts reported
in these financial statements.
CONSOLIDATION
a) Subsidiaries
Subsidiaries are all entities over which the
group has control. The group controls an entity
when the group is exposed to, or has rights to,
variable returns from its involvement with the
entity and has the ability to affect those returns
through its power over the entity. Subsidiaries
are fully consolidated from the date on which
control is transferred to the group. They are
deconsolidated from the date that control
ceases.
The Group uses the acquisition method of
accounting to account for business
combinations. The consideration transferred for
the acquisition of a subsidiary is the fair values
of the assets transferred, the liabilities incurred
and the equity interests issued by the Group.
Any difference between fair value and the
carrying value of assets transferred is
recognised in the income statement. The
consideration transferred includes the fair
value of any asset or liability resulting from a
contingent consideration arrangement.
Acquisition-related costs are expensed as
incurred. Identifiable assets acquired and
liabilities and contingent liabilities assumed in
a business combination are measured initially
at their fair values at the acquisition date. On
an acquisition-by-acquisition basis, the Group
recognises any non-controlling interest in the
acquiree either at fair value or at the non-
controlling interest’s proportionate share of the
acquiree’s net assets. The excess of the
consideration transferred, the amount of any
non-controlling interest in the acquiree and the
acquisition-date fair value of any previous
equity interest in the acquiree over the fair
value of the Group’s share of the identifiable
net assets acquired is recorded as goodwill. If
this is less than the fair value of the net assets
of the subsidiary acquired in the case of a
bargain purchase, the difference is recognised
directly in the income statement.
Inter-company transactions, balances and
unrealised profits on transactions between
Group companies are eliminated. Losses are
also eliminated but considered whether they
indicate an impairment that requires
recognition in consolidated financial
statements. Accounting policies of subsidiaries
have been changed where necessary to ensure
consistency with the policies adopted by the
Group.
b) Transactions with non-controlling interests
The Group treats transactions with non-
controlling interests as transactions with equity
owners of the group. For purchases from non-
controlling interests, the difference between
any consideration paid and the relevant share
acquired of the carrying value of net assets of
the subsidiary is recorded in equity. Gains or
losses on disposals to non-controlling interests
are also recorded in equity. When the group
ceases to consolidate or equity account for an
investment because of a loss of control, joint
control or significant influence, any retained
interest in the entity is remeasured to its fair
value with the change in carrying amount
recognised in profit or loss. This fair value
becomes the initial carrying amount for the
purposes of subsequently accounting for the
retained interest as an associate, joint venture
or financial asset. In addition, any amounts
previously recognised in other comprehensive
income in respect of that entity are accounted
for as if the group had directly disposed of the
related assets or liabilities. This may mean that
amounts previously recognised in other
comprehensive income are reclassified to profit
or loss. If the ownership interest in an associate
is reduced but the significant influence is
retained, only a proportionate share of the
amounts previously recognised in other
comprehensive income are reclassified to profit
or loss where appropriate.
c) Associates
Associates are all entities over which the group
has significant influence but not control or joint
control. This is generally the case where the
group holds between 20% and 50% of the
voting rights. Investments in associates are
accounted for using the equity method of
accounting (Note 2.1 d) below), after initially
being recognised at cost.
d) Equity method
Under the equity method of accounting, the
investments are initially recognised at cost
and adjusted thereafter to recognise the
group’s share of the post-acquisition profits or
losses of the investee in profit or loss, and the
2022 ANNUAL REPORT
PAGE 20
group’s share of movements in other
comprehensive income of the investee in
other comprehensive income. Dividends
received or receivable from associates and
joint ventures are recognised as a reduction in
the carrying amount of the investment.
When the group’s share of losses in an equity-
accounted investment equals or exceeds its
interest in the entity, including any other
unsecured long-term receivables, the group
does not recognise further losses, unless it
has incurred obligations or made payments on
behalf of the other entity.
Unrealized gains on transactions between the
group and its associates and joint ventures
are eliminated to the extent of the group’s
interest in these entities. Unrealized losses
are also eliminated unless the transaction
provides evidence of an impairment of the
asset transferred. Accounting policies of
equity accounted investees have been
changed where necessary to ensure
consistency with the policies adopted by the
group.
The carrying amount of equity-accounted
investments is tested for impairment in
accordance with the policy described in Note
2.5.
Going concern statement
On 24 February 2022 russian federation
launched a full-scale military invasion of
Ukraine. This was followed up by the
immediate enactment of martial law by the
government of Ukraine and corresponding
introduction of the related temporary
restrictions that impact the economic
environment. Considering the above,
Agromino has assessed the going concern
assumption based on which the financial
statements have been prepared.
There is a significant uncertainty over
the future development of military invasion,
its duration and short and long-term impact
on the Group, its people, operations, liquidity,
and assets. There could be multiple scenarios
of further developments of the current
situation with unknown likelihood and the
magnitude of the impact on the Group might
be from significant to severe.
However, the Group’s key personnel
and top managers continue working. None of
the Group's critical facilities or infrastructure
has suffered any significant damage. The
business processes have been reorganized to
adjust to the existing challenges and to
provide continuity to the Group’s activities.
In order to minimize storage and
optimize logistic, the Group made some
changes to sowing plan and implemented
them into reality – 2,3 thousand hectares
planned for corn were changed for mustard in
year 2022.
Part of land in Kharkiv region was
located at temporarily occupied territory
(period from February till September 2022).
However, after de-occupation that land began
to be cultivated for future sowing at once and
as at December 31, 2022 it has been already
partly sown under winter wheat (1,9 thousand
hectares).
As a result of military actions, Black Sea
ports in Ukraine suspended their operations,
making export through the sea terminals
temporarily inaccessible. As at December 31,
2021 the Group had significant balances of
grain for sale, however was not able to sell
similar volumes as in the previous year due to
suspension of sea ports operations.
Management had to rearrange its delivery
routes, setting up new logistic procedures and
in search for new counterparties. Hence, it
took longer for the Group to sell its stock of
inventory than expected. In the end of July
2022 ports “Odessa”, “Chornomorsk” and
“Pivdennyi” were unblocked by concluding
Black Sea Grain Initiative by russia and
Ukraine with the support of the UN and Turkey
in Istanbul. It was prolonged several times
after that. On May 17, 2023 president of
Turkey Recep Tayyip Erdogan declared the
prolongation of Grain deal for further two
months. Russia makes attempts to back off
Grain deal by removing port “Pivdennyi” from
initiative, that handles large-tonnage vessels.
However, the Group has well-arranged logistic
for grain export via overland routes to
European countries, and it allows the Group to
sell agricultural produce even in case of
problems with Grain deal.
Since August 2022 the Group devoted
part of its logistic capacities to other farmers
and implemented new direction of its
operations – trading of third parties’ grain.
Decision to start this activity was made not
only from economic point of view but also to
help eastern farmers who suffered the most
from consequences of war.
In order to support the ability to
operate on going concern basis, Group
Management prepared Budget and Cash Flow
Forecast for the year 2023, demonstrating the
ability of the Group to operate on going
concern basis. Budget 2023 was prepared
based on assumption that the degree of
intensity of military hostilities in the regions
where the Group’s assets are located and the
area of the Ukrainian territory currently
invaded by the russian troops will be not
increased; the Group is able to carry out
sowing and harvesting of crops;the railway
infrastructure performs its function and is
2022 ANNUAL REPORT
PAGE 21
used as a way of executing export sales due
to limitation of seaports usage.
Management has maintained a fruitful
relation with the banks. During 2022 the
Group managed to obtain bank loans of USD
1 000 thousand, EUR 1 079 thousand, and
UAH 310 492 thousand after February 24,
2022.
In 2023 the Group plans to extend its
storage capacities which are of great
importance for agroproducers.
The Group continues to generate its
revenue mainly from sales of grain in 2023.
Settlements with buyers and suppliers are
conducted by the Group under normal course
of business operations.
Military actions occurring create
material uncertainty for the Group in the
future. There is the risk of assets damage, loss
of inventory either physical loss as a result of
military actions, or appropriation for military
needs under the Martial Law in Ukraine, ability
of Black Sea ports to resume its operations,
availability of alternative export routes and
disruptions of the sowing and harvesting
campaign for the Group and for Ukraine in
general. The full extent of the impact of
further development of military actions on the
Group’s business is unknown, but its
magnitude might be severe. Management
acknowledges that future development of
military actions and their duration represent a
single source of material uncertainty which
may cast significant doubt about the Group’s
ability to continue as a going concern and,
therefore, the Group may be unable to realize
its assets and discharge its liabilities in the
normal course of business. Despite the single
material uncertainty relating to the war in
Ukraine, management is continuing taking
actions to minimize the impact on the Group
and thus believes that application of the going
concern assumption for the preparation of
these financial statements is appropriate.
An effect of war on significant
assumptions, used in Group’s forecasts,
cannot be predicted, thus Management came
to conclusion that there is material
uncertainty, that can cause significant
changes in operating activity of the Group in
case of expanding zone of military actions.
2.2 FOREIGN CURRENCY
TRANSLATION
a) Functional currency
Items included in the financial statements of
each of the Group’s entities are measured
using the currency of the primary economic
environment in which the entity operates (‘the
functional currency’). The functional
currencies of group entities are the following:
for Estonian subsidiaries the Euro, for
Ukrainian subsidiaries the Ukrainian hryvna,
for russian subsidiaries the russian rouble, for
Cypriot subsidiaries the Euro, for Czech
Republic the Czech koruna and for Danish
parent company the Euro.
b) Transactions and balances
Foreign currency transactions are translated
into the functional currency using the
exchange rates prevailing at the dates of the
transactions. Foreign exchange gains and
losses resulting from the settlement of such
transactions and from the translation at year-
end exchange rates of monetary assets and
liabilities denominated in foreign currencies
are recognised in the income statement.
Foreign exchange gains and losses that relate
to borrowings and cash equivalents are
presented in the income statement within
‘Gains/losses from exchange rate differences’.
All other foreign exchange gains and losses
are presented in the income statement within
‘Other (losses)/gains – net.
c) Presentation currency
The results and financial position of all the
Group entities (none of which has the currency
of a hyperinflationary economy) that have a
functional currency different from the
presentation currency are translated into the
presentation currency as follows:
(a) assets and liabilities for each balance
sheet presented are translated at the
closing rate at the date of that balance
sheet;
(b) income and expenses for each income
statement are translated at average
exchange rates of a month or a longer
period as appropriate (unless this
average is not a reasonable
approximation of the cumulative effect
of the rates prevailing on the
transaction dates, in which case
income and expenses are translated at
the rate on the dates of the
transactions); and
(c) all resulting exchange differences are
recognised in other comprehensive
income.
On consolidation, exchange differences arising
from the translation of the net investment in
foreign operations and of borrowings are taken
to shareholders’ equity. When a foreign
operation is partially disposed of or sold,
exchange differences that were recorded in
2022 ANNUAL REPORT
PAGE 22
Other comprehensive income are recognised in
the income statement as part of the gain or loss
on the sale.
Goodwill and fair value adjustments arising on
the acquisition of a foreign entity are treated as
assets and liabilities of the foreign entity and
translated at the closing rate.
In the year 2021 Agromino decided to change
its presentation currency from EUR to USD due
to Group perspective:
- Main revenue of the Group is generated
from grain sales and grain prices were mainly
denominated in USD or were related to USD
fluctuation. Bank loans of the Group were also
mostly denominated in USD historically.
The consolidated financial statements are
presented in USD, which became to be the
presentation currency for the group, and thus
comparative information was translated in USD
also.
Comparative amounts were translated from
EUR to USD in order to put them into
correspondence:
- Assets and liabilities were translated
using exchange rate USD/EUR (per
European Central Bank) as of each
reporting date.
- Income and expenses were translated
using average exchange rate USD/EUR
(per European Central Bank) for each
corresponding year presented.
- Accumulated earnings (deficit)
translated based on financial result for
each corresponding historical reporting
year using average exchange rate
USD/EUR (per European Central Bank)
for each corresponding year.
Translation was made since the first
reporting date 31/12/2006 at which
consolidated report of the Group was
prepared.
2.3 PROPERTY, PLANT AND EQUIPMENT
All property, plant and equipment except for
land is stated at historical cost less depreciation
and impairment, where required. Historical cost
includes expenditure that is directly
attributable to the acquisition of the items.
Subsequent costs are included in the asset’s
carrying amount or recognised as a separate
asset, as appropriate, only when it is probable
that future economic benefits associated with
the item will flow to the Group and the cost of
the item can be measured reliably. The carrying
amount of the replaced part is derecognised. All
other repairs and maintenance are charged to
the income statement during the financial
period in which they are incurred.
The land is not depreciated. Depreciation on
other assets is calculated using the straight-line
method to allocate their cost to their residual
values over their estimated useful lives, as
follows:
• Buildings 25-40 years
• Machinery 7-20 years
• Vehicles 3-5 years
• Furniture, fittings and equipment 3-8 years
The assets’ residual values and useful lives are
reviewed, and adjusted if appropriate, at each
balance sheet date.
An asset’s carrying amount is written down
immediately to its recoverable amount if the
asset’s carrying amount is greater than its
estimated recoverable amount (Note 2.5).
Gains and losses on disposals are determined by
comparing the proceeds with the carrying
amount and are recognised within Other
gains/losses – net, in the income statement.
General and specific borrowing costs directly
attributable to the acquisition, construction or
production of qualifying assets, which are assets
that necessarily take a substantial period of time
to get ready for their intended use or sale, are
added to the cost of those assets, until such time
as the assets are substantially ready for their
intended use or sale.
FAIR VALUE OF LAND
Land is carried using the revaluation method.
Under the revaluation method, an increase in
an asset’s carrying amount as a result of a
revaluation is recognised in other
comprehensive income and accumulated in
equity under other reserves. However, the
increase is recognised in profit or loss to the
extent that it reverses a revaluation decrease
of the same asset previously recognised in
profit or loss. A decrease in an asset’s carrying
amount as a result of a revaluation is
recognised in profit or loss. However, the
decrease is recognised in other comprehensive
income to the extent of any credit balance
existing in the revaluation surplus in respect of
that asset. The decrease recognized in other
comprehensive income reduces the amount
2022 ANNUAL REPORT
PAGE 23
accumulated in equity under other reserves
(Note 18).
Valuations are performed with sufficient
regularity to ensure that the fair value of a
revalued asset does not differ materially from
its carrying amount.
When revalued assets are sold, the amounts
included in other reserves are transferred to
retained earnings.
2.4 INTANGIBLE ASSETS
a) Licenses
Acquired computer software licences are
capitalised on the basis of the costs incurred to
acquire and bring to use the specific software.
These costs are amortised over their estimated
useful lives of two to ten years.
b) Land-usage rights under emphyteusis
Land-usage rights under emphyteusis are
capitalised on the basis of the costs incurred.
Land-usage rights are amortised over their
estimated useful lives to forty-nine years.
2.5 . IMPAIRMENT ON NON-FINANCIAL
ASSETS
Assets that are subject to depreciation and land
are reviewed for impairment whenever events
or changes in circumstances indicate that the
carrying amount may not be recoverable. An
impairment loss is recognised for the amount
by which the asset’s carrying amount exceeds
its recoverable amount. The recoverable
amount is the higher of an asset’s fair value
less costs of disposal and value in use. For the
purposes of assessing impairment, assets are
grouped at the lowest levels for which there are
separately identifiable cash flows (cash-
generating units). Non-financial assets other
than goodwill that suffered impairment are
reviewed for possible reversal of the
impairment at each reporting date.
2.6 FINANCIAL ASSETS
a) Classification
The Group classifies its financial assets in the
following categories: loans and receivables.
The classification depends on the purpose for
which the financial assets were acquired.
Management determines the classification of its
financial assets at initial recognition. Loans and
receivables are non-derivative financial assets
with fixed or determinable payments that are
not quoted in an active market. They are
included in current assets, except for maturities
greater than 12 months after the balance sheet
date. These are classified as non-current
assets. The Group's loans and receivables
comprise “Trade and other receivables” (see
Note 6) and Cash and cash equivalents (see
Note 5) in the balance sheet. See Note 2.10 for
measurement of trade receivables.
b) Recognition and measurement
Regular purchases and sales of financial assets
are recognised on the trade-date – the date on
which the Group commits to purchase or sell
the asset. Investments are initially recognised
at fair value plus transaction costs for all
financial assets not carried at fair value through
profit or loss. Financial assets are derecognised
when the rights to receive cash flows from the
investments have expired or have been
transferred and the Group has transferred
substantially all risks and rewards of
ownership. Loans and receivables are carried at
amortised cost using the effective interest
method.
The Group assesses at each balance sheet date
whether there is objective evidence that a
financial asset or a group of financial assets is
impaired. Impairment testing of trade
receivables is described in Note 2.10.
c) Impairment of financial assets carried at
amortised cost
The Group assesses at the end of each
reporting period whether there is objective
evidence that a financial asset or group of
financial assets is impaired. A financial asset or
a Group of financial assets is impaired and
impairment losses are incurred only if there is
objective evidence of impairment as a result of
one or more events that occurred after the
initial recognition of the asset (a ‘loss event’)
and that loss event (or events) has an impact
on the estimated future cash flows of the
financial asset or Group of financial assets that
can be reliably estimated. Evidence of
impairment may include indications that the
debtors or a group of debtors are experiencing
significant financial difficulty, default or
delinquency in interest or principal payments,
the probability that they will enter bankruptcy
or other financial reorganisation.
For loans and receivables category, the amount
of the loss is measured as the difference
between the asset’s carrying amount and the
present value of estimated future cash flows
(excluding future credit losses that have not
been incurred) discounted at the financial
asset’s original effective interest rate. The
carrying amount of the asset is reduced and the
2022 ANNUAL REPORT
PAGE 24
amount of the loss is recognised in the
consolidated income statement. If in a
subsequent period, the amount of the
impairment loss decreases and the decrease
can be related objectively to an event occurring
after the impairment was recognised, the
reversal of the previously recognised
impairment loss is recognised in the
consolidated income statement.
2.7 AGRICULTURE AND BIOLOGICAL
ASSETS
Agricultural activity is defined by the
management as an activity of the biological
transformation of biological assets for sale into
agricultural produce or into additional biological
assets. Agricultural produce is defined as the
harvested product of the Group’s biological
assets and a biological asset is defined as a
living animal or plant. The Group has
determined the groups of its biological assets
to be livestock and growing crops.
Biological assets are measured on initial
recognition and at each balance sheet date at
its fair value less cost to sell. Agricultural
produce harvested from the Group’s biological
assets is measured at its fair value less cost to
sell and is subsequently recorded as inventories
and measured in accordance with the
accounting principles of inventory (Note 2.9).
If an active market exists for a biological asset
or agricultural produce, the quoted price in that
market is the appropriate basis for determining
the fair value of that asset. If an active market
does not exist the most proximate market
transaction price, provided that there has not
been a significant change in economic
circumstances between the date of that
transaction and the balance sheet date, is used
in determining fair value.
A gain or loss arising on initial recognition of a
biological asset at fair value less cost to sell and
from a subsequent change in fair value less
cost to sell is included in profit or loss for the
period in which it arises as “Gain/loss of
biological assets arising from changes in fair
value less cost to sell”.
The biological assets are recorded as current
and non-current biological assets based on the
operational cycle of the respective biological
assets. In general, biological assets of growing
plants are recognised as current assets
because the operational cycle is less than 12
months. Dairy herd is recorded as a non-
current biological asset.
a) Livestock and dairy herd
Livestock is measured at their fair value less
estimated point-of-sale costs. The fair value
measurements are categorized under Level 2 in
the fair value hierarchy, as defined by IFRS 13.
b) Crops – cereals and grassland
Crops are measured at their fair value less cost
to sell. The fair value measurements are
categorized under Level 3 in the fair value
hierarchy, as defined by IFRS 13. Fair value of
biological assets sown for next year harvest by
present valuing the net cash flows expected to
be generated from the assets discounted at
average cost of short-term financing.
The Group’s grasslands qualify as bearer plants
under the definition in IAS 41 Agriculture and
are therefore accounted for under the rules for
plant and equipment. The grasslands are
carried at cost less depreciation. Grasslands
are depreciated for a period of 3 years.
2.8 GOVERNMENT GRANTS
a) Government grants related to agricultural
activity
An unconditional government grant related to
a biological asset measured at its fair value less
cost to sell is recognised as income when the
government grant becomes receivable
(government grants for the dairy herd, general
area-aid subsidies). If a government grant
related to a biological asset measured at its fair
value less cost to sell, is conditional, including
whereby a government grant requires a Group
company not to engage in specified agricultural
activity, the Group recognizes the government
grant as income when the conditions attaching
to the government grant are met (investment
subsidies, area-aid environmental subsidies)
and until then aid received is recognized as a
liability.
b) Government grants related to purchase of
property, plant and equipment
Grants from the government are recognised at
their fair value where there is a reasonable
assurance that the grant will be received and
the group will comply with all attached
conditions. Government grants relating to
property, plant and equipment are included in
non-current liabilities as deferred government
grants and are amortised to the income
statement on a straight-line basis over the
expected lives of the related assets.
2022 ANNUAL REPORT
PAGE 25
2.9 INVENTORIES
a) Agricultural produce
i. Milk
Milk is initially measured at its fair value
less cost to sell at the time of milking and
subsequently recorded as inventories and
measured at the lower of cost and net
realisable value. The fair value of milk is
determined based on market prices in the local
area.
ii. Grain- own produced (harvested)
Grain and feeds produced by the Group
are initially measured at its fair value less cost
to sell at the time of harvest and recorded in
inventories until sold to third parties or used
internally for feeding animals or for seeds.
Grains and feed produced by the Group are
subsequently measured at net realisable value.
The net realisable value of feed is determined
based on market prices in the local area. The
net realisable value of grain is determined
based on quoted prices on the nearest market
or if multiple markets are available, in the
market where the Group’s company expects to
sell the produce.
b) Grain – purchased from third parties
Purchased grain from third parties is initially
recorded at the purchase price and
subsequently measured at a fair value less cost
to sell. The fair value of grain is determined
based on quoted prices on the nearest market
or if multiple markets are available, on the
most advantageous market.
c) Work-in-progress related to field
preparation
Cost of agricultural preparation on fields before
seeding is recorded as work-in-progress in
inventories. Work in progress comprises raw
materials, direct labor costs and other direct
costs (based on normal operating capacity).
After seeding the cost of field preparation is
reclassified as biological assets (Note 2.7 b)).
d) Raw materials
Inventories are stated at the lower of cost and
net realisable value. Cost is determined using
weighted average cost method. Net realisable
value is the estimated selling price in the
ordinary course of business, less applicable
variable selling expenses.
2.10 TRADE RECEIVABLES
Trade receivables are amounts due from
customers for merchandise sold or services
performed in the ordinary course of business.
If the collection is expected in one year or less
(or in the normal operating cycle of the
business if longer), they are classified as
current assets. If not, they are presented as
non-current assets.
Trade receivables are recognised initially at fair
value and subsequently measured at amortised
cost using the effective interest method, less
provision for impairment.
2.11 CASH AND CASH EQUIVALENTS
Cash and cash equivalents include cash in
hand, deposits held at call with banks, other
short-term highly liquid investments with
original maturities of three months or less.
Deposits over three months are classified as
cash and cash equivalents if they are readily
convertible to a known amount of cash and are
subject to insignificant risk of changes in value.
2.12 SHARE CAPITAL
Ordinary shares are classified as equity.
Incremental costs directly attributable to the
issue of new shares or options are shown in
equity as a deduction, net of tax, from the
proceeds.
2.13 TRADE PAYABLES
Trade payables are obligations to pay for goods
or services that have been acquired in the
ordinary course of business from suppliers.
Accounts payable are classified as current
liabilities if payment is due within one year or
less. If not, they are presented as non-current
liabilities.
Trade payables are recognised initially at fair
value and subsequently measured at amortised
cost using the effective interest method.
2.14 BORROWINGS
Borrowings are recognised initially at fair value,
net of transaction costs incurred. Borrowings
are subsequently stated at amortised cost; any
difference between the proceeds (net of
transaction costs) and the redemption value is
recognised in the income statement over the
period of the borrowings using the effective
interest method.
Borrowings are classified as current liabilities
unless the Group has an unconditional right to
defer settlement of the liability for at least 12
months after the balance sheet date.
Borrowings are removed from the balance
sheet when the obligation specified in the
contract is discharged, canceled or expired. The
difference between the carrying amount of a
2022 ANNUAL REPORT
PAGE 26
financial liability that has been extinguished or
transferred to another party and the
consideration paid, including any non-cash
assets transferred or liabilities assumed, is
recognised in the Income statement as finance
income or finance cost. Where the terms of a
financial liability are renegotiated and the
entity issues equity instruments to a creditor to
extinguish all or part of the liability (debt for
equity swap), a gain or loss is recognised in the
Income statement, which is measured as the
difference between the carrying amount of the
financial liability and the fair value of the equity
instruments issued.
2.15 CURRENT AND DEFERRED INCOME
TAX
The tax expense for the period comprises a
current and deferred tax. Tax is recognised in
the income statement, except to the extent
that it relates to items recognised in other
comprehensive income or directly in equity. In
this case, the tax is also recognised in other
comprehensive income or equity, respectively.
a) Corporate income tax
The current income tax charge is calculated on
the basis of the tax laws enacted or
substantively enacted at the balance sheet date
in the countries where the Company and its
subsidiaries operate and generate taxable
income. Management periodically evaluates
positions taken in tax returns with respect to
situations in which applicable tax regulations
are subject to interpretation and establishes
provisions where appropriate on the basis of
amounts expected to be paid to the tax
authorities.
The Income tax rate in Ukraine is 18%, in
russia 20%, in Denmark 22%, in Czech
Republic 19% and in Cyprus 12.5%.
Agricultural producers in both Ukraine and
russia are exempted from the ordinary
corporate income tax system if they meet the
requirements to be recognised as agricultural
producers (Note 2.15 b)). The income tax in
Estonia is calculated only on distributed
earnings with the effective rate 20/80 of the
distributed amount. From 2019, a tax rate of
14/86 can be applied to dividend payments.
The more beneficial tax rate can be used for
dividend payments in the amount of up to the
average dividend payment during the three
preceding years that were taxed at the tax rate
of 20/80.
Deferred income tax is provided in full, using
the liability method, on temporary differences
arising between the tax bases of assets and
liabilities and their carrying amounts in the
consolidated financial statements. However,
the deferred income tax is not accounted for if
it arises from initial recognition of an asset or
liability in a transaction other than a business
combination that at the time of the transaction
affects neither accounting nor taxable profit nor
loss. Deferred income tax is determined using
tax rates (and laws) that have been enacted or
substantially enacted by the balance sheet date
and are expected to apply when the related
deferred income tax asset is realised or the
deferred income tax liability is settled.
Deferred income tax assets are recognised to
the extent that it is probable that future taxable
profit will be available against which the
temporary differences can be utilised.
Deferred income tax is provided on temporary
differences arising on investments in
subsidiaries and associates, except where the
timing of the reversal of the temporary
difference is controlled by the Group and it is
probable that the temporary difference will not
reverse in the foreseeable future.
Deferred income tax assets and liabilities are
offset when there is a legally enforceable right
to offset current tax assets against current tax
liabilities and when the deferred income taxes
assets and liabilities relate to income taxes
levied by the same taxation authority on either
the taxable entity or different taxable entities
where there are an intention and ability to
settle the balances on a net basis.
b) Agricultural tax regimes in Ukraine and
russia
Both in Ukraine and russia companies are
exempt from ordinary corporate income tax
regime if they meet criteria to be recognised as
agricultural producers.
In Ukraine, a company is considered to be an
agricultural producer if it derived at least 75%
of its revenue in the previous tax year from the
sales of the self-produced agricultural product.
Simplified agricultural tax means that the
agricultural producer pays tax based not on its
profits, but on the total area used for
agricultural production.
In russia, a company can apply for the
agricultural tax regime if it meets the criteria of
an agricultural company. However, the
companies on a general tax regime having the
revenue from sales of self-produced
agricultural produce have reduced tax rates.
2022 ANNUAL REPORT
PAGE 27
2.16 EMPLOYEE BENEFITS
a) Pension obligations and other post-
employment obligations
The Group does not operate pension schemes
and does not provide post-retirement benefits
to their retirees. Pension obligations may arise
due to a legal obligation to pay for the
incapability to work because of an accident.
The Group has legal obligation to pay
contributions to the state pension funds
according to the local regulations of each
country of location. The contributions to the
local pension funds are treated as social
security tax payments.
b) Termination benefits
Termination benefits are payable when
employment is terminated by the Group before
the normal retirement date, or whenever an
employee accepts voluntary redundancy in
exchange for these benefits.
2.17 PROVISIONS
Provisions for environmental restoration,
restructuring costs, and legal claims are
recognised when: the Group has a present legal
or constructive obligation as a result of past
events; it is probable that an outflow of
resources will be required to settle the
obligation, and the amount can be reliably
estimated. Restructuring provisions comprise
lease termination penalties and employee
termination payments. Provisions are not
recognised for future operating losses.
Provisions are measured at the present value
of the expenditures expected to be required to
settle the obligation using a pre-tax rate that
reflects current market assessments of the
time value of money and the risks specific to
the obligation. The increase in the provision
due to the passage of time is recognised as
interest expense.
2.18 REVENUE RECOGNITION
Revenue is income arising in the course of the
Group’s ordinary activities. Revenue is
recognised in the amount of transaction price.
Transaction price is the amount of
consideration to which the Group expects to be
entitled in exchange for transferring control
over promised goods or services to a customer,
excluding the amounts collected on behalf of
third parties.
Revenue is recognised net of discounts, returns
and value added taxes, export duties, other
similar mandatory payments.
Group's contracts with customers are fixed-
price contracts and generally include both
advance payment and deferred payment for
the same contracts. Generally the sales are
made with a credit term mainly to 2-5 business
days, which is consistent with the market
practice and consequently trade receivables
are classified as current assets.
A receivable is recognised when the goods are
delivered or dispatched based on delivery
terms as this is the point in time that the
consideration is unconditional because only the
passage of time is required before the payment
is due (Note 6). Contract assets are immaterial
and therefore not presented separately in the
consolidated financial statements.
A contract liability is an entity's obligation to
transfer goods or services to a customer for
which the entity has received consideration
from the customer. Contract liabilities are
included in trade and other payables line item
as advances from customers (Note 13).
a) Sales of goods – agricultural produce
The Group’s main revenue arises from the sales
of agricultural produce – grain and milk. The
agricultural produce is subject to quality control
at the point of sale and the sales value is
depending on the quality. Sales are recognised
when control of the good has transferred, being
when the goods are delivered to the customer,
the customer has full discretion over the goods,
and there is no unfulfilled obligation that could
affect the customer's acceptance of the goods.
Delivery occurs when the goods have been
shipped to the specific location, the risks of
obsolescence and loss have been transferred to
the customer, and either the customer has
accepted the goods in accordance with the
contract, the acceptance provisions have
lapsed, or the Group has objective evidence
that all criteria for acceptance have been
satisfied.
b) Sales of biological assets
The Group sells living animals for slaughter.
The revenue from sales of living animals is
recognised after the animals have been
delivered to the slaughterhouse.
c) Sales of services
The Group occasionally sells services to other
agricultural producers. Revenue from the
services is recognised when the service has
been provided.
2022 ANNUAL REPORT
PAGE 28
d) Interest income
Interest income is recognised on a time-
proportion basis using the effective interest
method. When a receivable is impaired, the
Group reduces the carrying amount to its
recoverable amount, being the estimated
future cash flow discounted at the original
effective interest rate of the instrument and
continues unwinding the discount as interest
income. Interest income on impaired loans is
recognised using the original effective interest
rate.
e) Dividend income
Dividend income is recognised when the right
to receive payment is established.
2.19 LEASES
The Group is a party to lease contracts as a
lessee for, the land plots.
Leases are recognized, measured and
presented in line with IFRS 16 Leases.
Land lease rights are measured at cost less any
accumulated depreciation and any
accumulated impairment losses and adjusted
for any re-measurement of the lease liability.
The Group depreciates the land lease rights
from the commencement date to the earlier of
the end of the useful life of the land lease right
asset or the end of the lease term on a straight-
line basis.
The finance cost is charged regarding lease
liabilities to profit or loss over the lease period.
The lease payments are discounted using the
borrowing cost as published by National Bank
of Ukraine on its official web-site
(www.bank.gov.ua) since the interest rate
implicit in the lease could not be determined.
2.20 DIVIDEND DISTRIBUTION
Dividend distribution to the Group’s
shareholders is recognised as a liability in the
Group’s financial statements in the period in
which the dividends are approved by the
Group’s shareholders.
2.21 NON-CURRENT ASSETS HELD FOR
SALE AND DISCONTINUED
OPERATIONS
Non-current assets (or disposal groups) are
classified as held for sale if their carrying
amount will be recovered principally through a
sale transaction rather than through continuing
use and a sale is considered highly probable.
They are measured at the lower of their
carrying amount and fair value less cost to sell,
except for assets such as deferred tax assets,
assets arising from employee benefits, financial
assets.
An impairment loss is recognised for any initial
or subsequent write-down of the asset (or
disposal group) to fair value less cost to sell. A
gain is recognised for any subsequent increases
in fair value less cost to sell of an asset (or
disposal group), but not in excess of any
cumulative impairment loss previously
recognised. A gain or loss not previously
recognised by the date of the sale of the non-
current asset (or disposal group) is recognised
at the date of derecognition.
Non-current assets (including those that are
part of a disposal group) are not depreciated or
amortised while they are classified as held for
sale. Interest and other expenses attributable
to the liabilities of a disposal group classified as
held for sale continue to be recognised.
Non-current assets classified as held for sale
and the assets of a disposal group classified as
held for sale are presented separately from the
other assets in the balance sheet. The liabilities
of a disposal group classified as held for sale
are presented separately from other liabilities
in the balance sheet.
A discontinued operation is a component of the
entity that has been disposed of or is classified
as held for sale and that represents a separate
major line of business or geographical area of
operations, is part of a single coordinated plan
to dispose of such a line of business or area of
operations, or is a subsidiary acquired
exclusively with a view to resale. The results of
discontinued operations are presented
separately in the statement of profit or loss.
2022 ANNUAL REPORT
PAGE 29
3. FINANCIAL RISK MANAGEMENT
3.1 FINANCIAL RISK FACTORS
The Group’s activities expose it to a variety of
financial risks: market risk (including currency
risk, commodity price risk, cash flow interest
rate risk, fair value interest rate risk), credit
risk, liquidity risk and capital repatriation risk.
The Group’s overall risk management program
acknowledges the unpredictability of financial
markets and on the basis of the current
business operations of the Group, the
management is following financial risk
management policies to minimise potential
adverse effects on the Group’s financial
performance from unpredictable fluctuations in
the financial markets. The Group’s centralised
controlling and risk management function
carries out risk management activities on a
day-to-day basis in close cooperation with the
regional management members.
1. Market risk
(i) Foreign exchange risk
The Group operations in Ukraine are exposed
to foreign exchange risk arising primarily from
exposures to the US dollar, Euro, and Ukrainian
hryvna. Foreign exchange risks from US dollar,
Euro, and Ukrainian hryvna arise mainly from
recognised assets and liabilities. The Group has
not implemented any formal currency risk
management policies.
The average value of US dollar relative to euro
apreciated by 11% in 2022 (depreciated in
2021 by 3.5%)
As at 31 December 2022, the exchange rate of
Ukrainian hryvna was 36,5686 UAH/USD (as at
31 December 2021 - 27,3023 UAH/USD).
As at 31 December 2022, the exchange rate of
Ukrainian hryvna was 38,951 UAH/EUR (as at
31 December 2021 – 30,9226 UAH/EUR).
The total recognised decrease in equity from
currency translation differences amounted to
USD 60 143 thousand at December 31, 2022
(USD 52 550 thousand at December 31, 2021)
(Note 18).
(ii) Commodity price risk
The Group is exposed to commodities price risk
because of the significant size of its business
operations in the production of cereals. In case
cereals produced by the Group are primarily
exported, a significant share of the Group’s
revenues will be exposed to global fluctuations
in agricultural commodity prices. The milk
production operations of the Group are to a
lesser extent affected by global commodity
prices since the raw milk is sold regionally and
cannot be exported over long distances.
The Group’s strategy is not to hedge against
any commodity price movements in order to
provide its shareholders a direct exposure to
the fluctuation in the market. Unlike traditional
large-scale farming enterprises that have
typically used a financial hedging strategy to
protect against adverse price fluctuations or
the risks inherent in a highly seasonal business,
the Group does not engage in any commodity
hedging. The Group believes that its diversified
crop rotation system and its combination of
cereal production and dairy farming provide its
business with sufficient operational stability.
(iii) Cash flow and fair value interest rate
risk
As the Group has no significant floating
interest-bearing assets, the Group’s income
and operating cash flows are substantially
independent of changes in market interest
rates.
The Group’s interest rate risk arises from
borrowings (Note 14). Borrowings issued at
variable rates expose the Group to cash flow
interest rate risk. The Group analyses its
interest rate exposure on a dynamic basis.
Various scenarios are simulated taking into
consideration refinancing, renewal of existing
positions and alternative financing.
At 31 December 2022, if interest rates on
floating interest rate borrowings at that date
had been 0.5% higher with all other variables
held constant, net loss for the year would have
been USD 29 thousand higher (2021: USD 3
thousand higher), as a result of higher interest
expense on floating rate borrowings.
2022 ANNUAL REPORT
PAGE 30
The breakdown between floating and fixed interest rates for the existing borrowings of the Group is
shown below:
in USD thousand
31.12.2022
31.12.2021
Borrowings and finance leases (outstanding amount)
Floating rate
5 724
670
incl. related to LIBOR
26
610
incl. related to EURIBOR
82
60
incl. related to UIRD
5 616
Fixed rate
9 156
-
14 880
670
2. Credit risk and counterparty business risk
Credit risk for the Group arises from cash and
cash equivalents, deposits with banks and
financial institutions and customers, including
outstanding receivables and committed
transactions. In respect of banks and financial
institutions, the Group’s policy is to work with
institutions, which have an internationally
reputable strategic shareholder as the majority
investor. (See also Note 5 for details).
3. Liquidity risk
The Group’s main liquidity risks derive from the
cyclical nature of agricultural production. Field-
works in spring and harvest in autumn entails
concentration of costs and working capital need
in the spring season and concentration of
revenues in the autumn season. The cyclicality
is stronger in cereals production and much
lower in dairy production, as dairy production
revenues accrue evenly throughout the whole
operating year. The Group has been lowering
the cyclicality also in cereals production by
acquiring its own warehousing infrastructure to
store grain for longer time periods and to be
able to sell cereal products more evenly
throughout the year. The management
monitors the liquidity risk by following the main
key performance indicators on a continuous
basis, including cash flows.
The undiscounted gross payments of all
borrowings and trade payables are presented
in the included tables. The amounts include
interest payments.
in USD thousand
Total
31.12.2022
On
demand
and less
than 6
months
between
6 and 12
months
between
1 and 2
years
between
2 and 10
years
Maturity
Interest rate
Borrowings and
finance leases
(Note 14)
15 658
10 259
3 513
1 654
232
incl. related to
UIRD
2 517
1 258
1 259
-
-
2023
UIRD 3m + 5%
incl. related to
UIRD
1 913
146
1 767
-
-
2023
UIRD 3m + 7 %
incl. related to
UIRD
381
77
71
233
-
2025
UIRD 12m + 8,98
%
incl. related to
UIRD
1 543
317
290
936
-
2025
UIRD 12m + 10,98
%
incl. related to
EURIBOR
82
82
-
-
-
2023
7days EURIBOR +
1,6%
incl. related to
LIBOR
32
32
-
-
-
2023
1mLIBOR + 4,4%
incl. with fixed
interest rate
9 190
8 347
126
485
232
2023-2026
2,8%-20%
Payables (Note 13)
2 971
2 912
57
2
-
2023
no interest rate;
5% for amount of
loans from related
parties
Total
18 629
13 171
3 570
1 656
232
2022 ANNUAL REPORT
PAGE 31
in USD thousand
Total
31.12.2021
On
demand
and less
than 6
months
between
6 and 12
months
between
1 and 2
years
between
2 and 10
years
Maturity
Interest rate
Borrowings and
finance leases
(Note 14)
709
494
172
43
-
incl. related to
EURIBOR
60
60
-
-
-
2022
7days EURIBOR +
1,6%
incl. related to
LIBOR
386
386
-
-
-
2022
2,8%-3,74%%
incl. related to
LIBOR
263
48
172
43
-
2023
1mLIBOR + 4,4%
Payables (Note 13)
1 647
1 451
193
3
-
2022
no interest rate;
5% for amount of
loans from related
parties
Total
2 356
1 945
365
46
-
3.2 CAPITAL MANAGEMENT
The Group considers as capital its equity and
borrowings.
in USD thousand
31.12.2022
31.12.2021
Borrowings (Note
14)
14 880
670
Total shareholders´
equity
68 380
87 175
Capital repatriation risk
The capital repatriation risk derives from the
Group’s investments into Ukrainian subsidiaries.
Potential changes in the political environment in
Ukraine may impose restrictions on repatriating
capital invested as it was historically.
3.3 FAIR VALUE ESTIMATION
The different levels for assets carried at fair
value have been defined as follows:
• Quoted prices (unadjusted) in active
markets for identical assets or liabilities
(Level 1).
• Inputs other than quoted prices included
within level 1 that are observable for the
asset or liability, either directly (that is, as
prices) or indirectly (that is, derived from
prices) (Level 2).
• Inputs for the asset or liability that are not
based on observable market data (that is,
unobservable inputs) (Level 3).
See Note 11 for disclosures of the land that is
measured at fair value, Note 8 for inventories,
Note 9 for biological assets and Note 14 for
borrowings.
4. CRITICAL ACCOUNTING ESTIMATES AND
JUDGMENTS
Estimates and judgments are continually
evaluated and are based on historical
experience and other factors, including
expectations of future events that are believed
to be reasonable under the circumstances.
4.1 CRITICAL ACCOUNTING
ESTIMATES AND ASSUMPTIONS
The Group makes estimates and assumptions
concerning the future. The resulting accounting
estimates will, by definition, rarely equal the
related actual results. The estimates and
assumptions that have a significant risk of
causing a material adjustment to the carrying
2022 ANNUAL REPORT
PAGE 32
amounts of assets and liabilities within the next
financial year are outlined below.
a) Fair value of biological assets
The Group’s biological assets are measured at
fair value less cost to sell at each balance sheet
date (value at December 31, 2022 was
USD 5 835 thousand and value at December
31, 2021 was USD 2 466 thousand) (Note 9).
Variability analysis:
Were the actual prices for the biological assets
in animal husbandry higher by 10% from
management’s estimates, the fair value would
increase by USD 73 thousand (by USD 80
thousand in 2021), if the prices were lower by
10%, the fair value would decrease by the
same amount.
Were the actual crop yields or prices in crop
cultivation higher by 10 % from management
estimates, the fair value would increase by USD
882 thousand as of December 31, 2022 (by
USD 912 thousand as of December 31, 2021),
if crop yields or prices were lower by 10 %, the
fair value would decrease for the same amount.
Were the actual cost per ha in crop cultivation
higher by 10 % from management estimates,
the fair value would decrease by USD 417
thousand as of December 31, 2022 (by USD
749 thousand as of December 31, 2021), if
crop yields were lower by 10 %, the fair value
would increase for the same amount.
b) Useful lives of property, plant, and
equipment
The depreciable items of property, plant, and
equipment amounted to USD 15 367 thousand
as at December 31, 2022 (USD 19 860
thousand as at December 31, 2021) (Note 11).
The remaining balance includes land, which
does not depreciate; and construction in
process. Management has estimated useful
lifetimes for depreciable property, plant, and
equipment. However, the actual useful
lifetimes can be different than those estimated
by the management. If the average useful
lifetime would be 10% longer (shorter) than
estimated by the management, it would
decrease (increase) the depreciation charge by
USD 280 thousand (decrease/increase by USD
347 thousand in 2021).
c) Net realisable value and fair value less cost
to sell of inventories
The Group has its agricultural produce in
inventory as of the year-end (Note 8). The
agricultural produce and inventories for
commodities trading have been valued to fair
value less cost to sell. The fair value of the
grain is determined based on the market
statistics or in case the Group had sold or had
sales contracts for its inventory then those
actual prices were used. Would the prices be
lower (higher) than estimated by 10%, the
value of the inventories would be USD 2 583
thousand less (more) and the equity smaller
(bigger) by the equal amount (in 2021: USD 2
052 thousand).
d) Recoverable values of property, plant, and
equipment
For the assets in Ukraine impairment test was
carried out as of December 31, 2022. The
value-in-use method was applied to determine
the recoverable values of non-current assets.
Cash flow was projected, including revenues,
operating expenses, investment requirements
and working capital needs. The Group applied
5.5 % of long-term growth rate. The discount
rate applied was 29.5 %. The test
demonstrated that the assets value in use was
higher than the carrying amount of these
assets.
The Group used in the model its target yields
and prices based on forecasts prepared on
current situation and assumption that the
degree of intensity of military hostilities in the
regions where the Group’s assets are located
and the area of the Ukrainian territory currently
invaded by the russian troops will be not
increased; the Group is able to carry out sowing
and harvesting of crops; the railway
infrastructure performs its function and is used
as a way of executing export sales due to
limitation of seaports usage.
However, material uncertainty for the Group in
the future exists just because of external
factors which are out of Management influence,
namely military actions occurring in Ukraine.
War of russia in Ukraine can have impact on
significant assumptions, used in Group’s
forecasts, and thus recoverable values of non-
current assets can be changed. Effect of such
impact cannot be predicted.
2022 ANNUAL REPORT
PAGE 33
Major sensitive inputs 2022:
USD thousand
Change
Impairment
Increase in discount rate
2pp
no
Decrease in terminal
growth rate
1pp
no
For the assets in Ukraine impairment test was
carried out as of December 31, 2021. The
value-in-use method was applied to determine
the recoverable values of non-current assets.
Cash flows were projected, including revenues,
operating expenses, investment requirements
and working capital needs. The Group used in
the model its target yields and prices based on
forecasts. The Group applied 5% long-term
growth rate. The discount rate applied was
18.50%. The test demonstrated that the assets
value in use was higher than the carrying
amount of these assets.
Major sensitive inputs 2021:
USD thousand
Change
Impairment
Increase in discount rate
2pp
no
Decrease in terminal
growth rate
1pp
no
Assets in milk production in russia were
classified as assets held for sale as of December
31, 2021 (Note 31).
e) Fair value of land
The fair value of land is reliant on significant
assumptions and unobservable inputs. See
Note 11.1 for the measurement of fair value of
land and financial impact of a potential change
in the value per hectare.
4.2 OTHER RISK FACTORS
RISKS RELATED TO UKRAINIAN LAND
28 April 2020 the President of Ukraine signed
new land law which leads to discrimination of
foreign investors in Ukrainian agriculture. The
key part of new land legislation came into force
in July 2021.
4.3 OPERATING ENVIRONMENT
The Group conducts its operations in
Ukraine. After a slight recovery in 2021 from
global economic recession caused by the
COVID-19 pandemic, starting on 24
February 2022 the Ukrainian economy is
being damaged of ongoing russia’s full-scale
war against Ukraine, exposing risks that are
not typical and creating challenges for
businesses located and operating there.
The invasion was preceded by months of
russian troops gathering on Ukraine’s
borders, which russia tried to disguise as
exercises, as well as escalation of russian
military aggression against Ukraine in some
areas of Lugansk and Donetsk regions that
started in spring 2014, together with illegal
annexation of Crimea by the russian
federation
On 24 February 2022, Ukraine imposed
martial law and ordered general
mobilization. Following russian troops defeat
in the north of Ukraine, Armed Forces of
Ukraine made russia withdrew its troops
from Kyiv, Chernihiv, and Sumy regions in
April 2022. In addition, under considerable
pressure from Ukrainian troops, russians left
the right-bank part of the Kherson region in
November 2022. As winter approaches,
russia has shifted its focus to terrorist
bombing of critical civilian infrastructure. As
a result, Ukraine faced a shortage of
electricity. The Armed Forces of Ukraine
continue fierce resistance to russian forces.
However, the consequences of military
aggression are currently destruction of
civilian infrastructure, including production
facilities, scaled back and, in some cases,
stopped the operation of certain businesses,
disrupted supply chains, large-scale
displaced of people, and other.
The fall in Ukraine's GDP by the end of 2022
is estimated at the level of 30.4% (±2%),
which is a better indicator than predicted by
previous forecasts.
In 2022, the Ukrainian hryvnia significantly
depreciated against major foreign
currencies. As at 31 December 2022, the
official exchange rate of the National Bank of
Ukraine to the US dollar was 36.5686
hryvnias, and to the euro was 38.951
hryvnias (as at 31 December 2021: 27.2782
and 30.9226, respectively).
Russia’s war invasion of Ukraine also
affected the assessment of Ukraine’s
solvency by international rating agencies. In
2022 Standard & Poor's credit rating for
2022 ANNUAL REPORT
PAGE 34
Ukraine stands at CCC+ with stable outlook.
Moody's credit rating for Ukraine was last set
at Caa3 with negative outlook (increased
February 2023 up to Ca with stable outlook).
Fitch's credit rating for Ukraine was last
reported at CC.
The war has significantly impacted the
Group’s business and its performance.
Management continues to make efforts to
identify and mitigate impacts to the Group,
however, there are factors beyond its
knowledge or control, including the duration
and severity of warfare, level of international
support of Ukraine, as well as further
governmental and diplomacy actions taken.
The management’s assessment of the
Group’s ability to continue as a going
concern is detailed in Note 2.1.
5. CASH AND CASH EQUIVALENTS
in USD thousand
31.12.2022
31.12.2021
Cash on hand
1
2
Short-term bank deposits
694
1 454
695
1 456
Short-term bank deposits include cash balances at bank accounts, bearing interest of 0%-3.5% on
annualized base (in 2021 0% – 3.5 %)
The credit quality of cash at bank according to banks external credit rating (Moody’s) is given in the
following table:
in USD thousand
31.12.2022
31.12.2021
A1
41
57
A2
27
Aa3*
4
29
Baa1*
86
1 168
B3
-
48
Caa2
-
28
Caa3
11
-
Other
525
124
694
1 454
* As at December 31, 2022, the parent company ratings were used for the money at AS SEB Bank
(Estonia), AS Swedbank (Estonia), PJSC OTP Bank (Ukraine) and PJSC Credit Agricole Bank (Ukraine)
(the same as of December 31, 2021).
The split of cash between currencies:
in USD thousand
31.12.2022
31.12.2021
Ukrainian hryvna
283
681
US dollar
27
700
Euro
350
69
russian rouble
-
-
Other currencies
35
6
695
1 456
2022 ANNUAL REPORT
PAGE 35
6. TRADE AND OTHER RECEIVABLES
in USD thousand
31.12.2022
31.12.2021
Trade receivables
1 549
825
Other receivables
3 747
810
Prepayments for taxes
7 720
4 327
Prepayments to suppliers
2 918
4 593
Total receivables and prepayments
15 934
10 555
Less non-current portion:
Prepayments for non-current assets
-1 334
-2 641
Other receivables
-110
-
Total non-current portion
-1 444
-2 641
Current portion
14 490
7 914
The fair values of trade and other receivables are
not materially different from the carrying values
based on the expected discounted cash flows.
Prepayment for taxes consist mainly of VAT
receivable balance. After reporting date, in 2023
Group obtained VAT budget compensation in
amount USD 3 016 thousand (UAH 110 296
thousand).
All non-current receivables are due within more
than one year from the balance sheet date. Non-
current prepayments will realize in non-current
assets, like property, plant, and equipment.
Other receivables include loan receivable
towards related party in amount of USD 2 660
thousand as at December 31, 2022 (USD 352
thousand as at December 31, 2021). The Group
also had loans payable with related party in
amount USD 564 thousand as at December 31,
2022 (USD 726 thousand as at December 31,
2021) (Note 29). Thus, net amount receivable
towards related party equaled USD 2 096
thousand as at December 31, 2022.
For a breakdown of trade and other receivables
by category please refer to Note 7.
The ageing of trade receivables is as follows:
in USD thousand
31.12.2022
31.12.2021
including receivables not due
1 459
494
including receivables overdue up to 3 months
11
276
including receivables overdue up 3 to 6 months
22
-
including receivables overdue over 6 months
57
55
The ageing of other receivables is as follows:
in USD thousand
31.12.2022
31.12.2021
including receivables not due
3 732
798
including receivables overdue up to 3 months
-
10
including receivables overdue over 6 months
15
2
Overdue trade receivables are not considered
impaired based on the individual assessment of
each significant receivable.
The credit quality of trade receivables that are
not overdue can be assessed by reference to
external credit ratings (if available) or to
historical information about counterparty default
rates:
2022 ANNUAL REPORT
PAGE 36
in USD thousand
31.12.2022
31.12.2021
Group 1
1 229
68
Group 2
227
426
Group 3
3
-
Total unimpaired trade receivable
1 459
494
Group 1 – new customers/related parties (less than 6
months).
Group 2 – existing customers/related parties (more than 6
months) with no defaults in the past.
Group 3 – existing customers/related parties (more than 6
months) with some defaults in the past. All defaults were
fully recovered.
As at December 31, 2022, Other receivables not
due are from counterparties with no or some
defaults in the past (no or some defaults in the
past in as at December 31, 2021).
in USD thousand
2022
2021
At January 1
-
-
Provision for receivables impairment
-
-
Receivables written off during the year as uncollectible
-
-
Provision recovery
-
-
Currency translation differences
-
-
At December 31
-
-
The carrying amounts of the Group’s trade and other receivables are denominated in the following
currencies:
in USD thousand
31.12.2022
31.12.2021
US dollar
14
443
Ukrainian hryvna
582
829
Euro
3 508
359
Czech koruna
1 192
4
5 296
1 635
The maximum exposure to credit risk arising
from trade and other receivables at the reporting
date is the carrying amount of each class of
receivable mentioned above. The Group does
not hold any collateral as security for the trade
receivable
2022 ANNUAL REPORT
PAGE 37
7. FINANCIAL INSTRUMENTS BY CATEGORY
In USD thousand
31.12.2022
31.12.2021
Assets as per balance sheet
Loans and
receivables
Loans and
receivables
Cash and cash equivalents (Note 5)
695
1 456
Trade and other receivables excluding prepayments (Note 6)
5 296
1 635
5 991
3 091
31.12.2022
31.12.2021
Liabilities as per balance sheet
Financial
liabilities at
amortised
cost
Financial
liabilities at
amortised
cost
Trade and other payables excluding social security, other
taxes and prepayments from clients (Note 13)
2 970
1 647
Borrowings excluding lease liabilities (Note 14)
13 459
60
Lease liabilities (Note 14)
1 421
610
Land lease liability (Note 22)
16 504
18 456
34 354
20 773
Prepayments are excluded as this analysis is required only for financial assets.
8. INVENTORIES
Inventory breakdown, USD thousand
31.12.2022
31.12.2021
Grain for sale
25 833
20 523
Raw materials, supplies
4 659
6 682
Fieldworks in process
2 228
3 682
Total
32 720
30 887
Incl. own produced inventory
26 364
24 895
in USD thousand
2022
2021
At 1 January
24 895
5 814
Changes in balances of finished product stocks**:
9 312
21 935
- Agricultural production recognized at the fair value (Note 9)
25 664
39 424
- Dairy production recognized at the fair value
3 169
5 832
- Capitalization of costs to fieldworks in process
2 146
3 960
- Reclassification from fieldworks in process to biological assets at the
moment of seeding
-2 632
-2 853
- Cost of own production on realization to third parties
-23 580
-25 095
- Inventory revaluation
4 545
667
For internal use*
-1 023
-2 035
Classified as assets held for sale
-
-782
Currency translation differences
-6 820
-37
At 31 December
26 364
24 895
*Own produced inventory for internal use includes seeds, fertilizer and animal feed, which are presented in the
Income statement on the line Raw materials and consumables used for production purposes (Note 20).
** Changes in balances of finished product stocks include amount USD 128 thousand from discontinued operations.
Changes in balances of finished products from continuing operations is USD 9 184 thousand for the year 2022 (USD
1 623 thousand and USD 20 312 thousand correspondingly for the year 2021).
Inventories that are measured at fair value are
categorized under Level 2 in the fair value
hierarchy, as defined by IFRS 13.
Grain for sale is revalued by the Group on each
balance sheet date using contracted and market
prices.
2022 ANNUAL REPORT
PAGE 38
Own produced inventories are measured at net
realizable value. In determining the NRV (net
realizable value), the Group also considers
existing sales agreements at balance sheet date,
and actual sales transactions by the Group
shortly after the balance sheet date.
As at December 31, 2022 inventories at carrying
value of USD 3 649 thousand were pledged for
the benefit of banks. As at December 31, 2021,
inventories were not pledged at a carrying value
for the benefit of the bank.
Breakdown of the grain for sale, agricultural produce
inventory, 31.12.2022
Grain for sale,
agricultural
produce, USD
thousand
Tonnes
Average
price used,
USD/t
Wheat
6 158
34 744
177
Barley
-
5
-
Sunflower
8 475
20 963
404
Corn
5 395
27 088
199
Rapeseed
1 976
3 902
507
Soya
2 032
4 868
417
Canary
80
110
727
Millet
595
2 846
209
Mustard
718
540
1 330
Other
404
2 374
170
Total
25 833
97 440
265
Breakdown of the grain for sale, agricultural produce
inventory, 31.12.2021
Grain for sale,
agricultural
produce, USD
thousand
Tonnes
Average
price used,
USD/t
Wheat
192
694
276
Barley
2
7
245
Sunflower
2 836
4 413
643
Corn
12 136
54 575
222
Rapeseed
18
27
659
Soya
3 061
5 193
589
Canary
22
47
477
Millet
2 237
8 830
253
Other
19
294
67
Total
20 523
74 080
277
9. BIOLOGICAL ASSETS
in USD thousand
Plant
cultivation
Animal
husbandry
Total
Carrying amount at 31.12.2021
1 670
796
2 466
Non-current biological assets
3
796
799
Current biological assets
1 667
-
1 667
2022
Gain/loss arising from changes in fair value less estimated point
of sale costs of biological assets*:
4 279
90
4 369
- Increases due to new plantations/birth
30 048
348
30 396
- Harvest (Note 8)
-25 665
-
-25 665
- Decreases due to written-off biol.assets
-104
-258
-362
- Other changes in fair value
-
-
-
Currency translation differences
-842
-158
-1 000
Carrying amount at 31.12.2022
5 107
728
5 835
Non-current biological assets
7
728
735
Current biological assets
5 100
-
5 100
2022 ANNUAL REPORT
PAGE 39
in USD thousand
Plant
cultivation
Animal
husbandry
Total
Carrying amount at 31.12.2020
1
5 339
3 471
8 810
Non-current biological assets
124
3 471
3 595
Current biological assets
5 215
-
5 215
12m 2021
Decrease due to subsidiary disposal
-616
-
-616
Reclassified to assets held for sale
-100
-3 056
-3 156
Gain/loss arising from changes in fair value less estimated point
of sale costs of biological assets*:
-3 022
387
-2 635
- Increases due to new plantations/birth
36 573
1 132
37 705
- Harvest (Note 8)
-39 424
-
-39 424
- Decreases due to written-off biol.assets
-170
-1 002
-1 172
- Other changes in fair value
-
258
258
Currency translation differences
69
-6
63
Carrying amount at 31.12.2021
1 670
796
2 466
Non-current biological assets
3
796
799
Current biological assets
1 667
-
1 667
*Gain/loss of biological assets arising from changes in fair value less cost to sell comprises of amount
USD (3 580) thousand from continuing operations and amount USD 945 thousand from discontinued
operations in 2021.
Animals,
pcs
Winter
crops,
hectares
Unharvested
corn,
hectares
Physical quantities at 31.12.2022
1 172
9 314
141
Physical quantities at 31.12.2021
3 649
12 441
-
As at the balance sheet date, Current biological
assets in plant cultivation include winter crops
seeded for the next harvest and also corn at
141 hectares, that was not harvested in 2022.
Non-current biological assets in plant
cultivation include grasslands, which are used
for harvesting animal feed. Non-current assets
in animal husbandry include dairy herd, both
mature and immature. Animal husbandry is
measured at fair value less cost to sell.
The gain arising from changes in fair value
includes changes in both physical quantities
due to the growth of plants/animals and
changes in market prices of the biological
assets.
Fair value of biological assets sown for next
year harvest is determined by present valuing
the net cash flows expected to be generated
from the assets discounted at average cost of
short-term financing. The fair value of
biological assets is determined by the Group’s
own agricultural and IFRS experts. The
valuation of the biological assets (winter wheat
and winter rapeseed, corn) is within level 3 of
the fair value hierarchy.
Winter crops seeded in 2022 for the next year
and unharvested corn are determined by
valuing the net cash flows expected to be
generated from the assets discounted at
average cost of short-term financing.
The following inputs and assumptions were
made to determine the fair value of biological
assets:
- revenue from the crops sales is projected
based on the expected volume of crop
harvested;
- prices are projected based on budget data for
next year;
- production and costs to sell are projected
based on budget data for next year;
-a discount rate 38.28% is applied in
determining fair value of biological assets as of
December 31, 2022 (16.5% as of December
31, 2021).
The significant unobservable inputs used in the
fair value measurement of the crops as of
31.12.2022 are as follows:
Yields of crops (5,93 tons per hectare for winter
wheat, 2,94 tons per hectare for winter
rapeseed, 7,62 tons per hectare for corn).
Prices of crops (UAH 6 276 per ton for winter
wheat and UAH 19 561 per ton for winter
rapeseed, UAH 6 199 per ton for corn).
2022 ANNUAL REPORT
PAGE 40
Inputs used in the fair value measurement of
the crops for comparative reporting date
December 31, 2021 were as follows:
Yields of crops (4,03 tons per hectare for winter
wheat, 1,94 tons per hectare for winter
rapeseed).
Prices of crops (UAH 5 865 per ton for winter
wheat and UAH 14 906 per ton for winter
rapeseed).
The fair value of the livestock is based on the
valuation from the independent valuator. The
valuator used the market prices of livestock of
similar age, breed and genetic merit based on
the relevant market, taking into account
transaction prices on the most advantageous
market, and the market situation in the dairy
sector. The fair value measurements are
categorized under Level 2 in the fair value
hierarchy, as defined by IFRS 13. In 2022, the
gain from revaluating 1 172 animals was
recorded at USD 62 thousand in the Income
Statement (in 2021 the gain from revaluating
3 649 animals in amount USD 258 thousand in
the Income Statement). In total, the fair value
of the herd (1 172 animals), as of December
31, 2022, stood at USD 728 thousand. In total,
the fair value of the herd (3 649 animals), as
of December 31, 2021, stood at USD 3 853
thousand. As of December 31, 2021 part of the
herd with fair value of USD 3 056 thousands
was classified as assets held for sale.
As at December 31, 2022, biological assets in
Ukraine were pledged at a value of USD 2 811
thousand for the benefit of the bank. As at
December 31, 2021 biological assets were not
pledged for a benefit of the bank.
In the year 2022 harvest of cereals was at the
level of 102 251 net tonnes (2021: 191 241 net
tonnes). Milk production for the year 2022 was
4 858 tonnes (14 385 tonnes for the year
2021).
10. INTANGIBLE ASSETS
As of December 31, 2022 there were 7 702,96
ha under emphyteusis agreements (As of
December 31, 2021 – 7 108,37 ha).
in USD thousand
Software
Land-usage
rights under
emphyteusis
Total
31.12.2021
Cost
135
14 216
14 351
Accumulated amortization
-123
-282
-405
Net book amount
12
13 934
13 946
2022
Additions
5
1 648
1 653
Amortization charge
-1
-264
-265
Disposal
-
-228
-228
Currency translation
differences
-3
-3 666
-3 669
Closing net book amount
13
11 424
11 437
31.12.2022
Cost
106
11 874
11 980
Accumulated amortization
-93
-450
-543
Net book amount
13
11 424
11 437
2022 ANNUAL REPORT
PAGE 41
in USD thousand
Software
Land-usage
rights under
emphyteusis
Total
31.12.2020
1
Cost
110
6 533
6 643
Accumulated amortization
-97
-120
-217
Net book amount
13
6 413
6 426
2021
Additions
-
7 501
7 501
Amortization charge
-2
-164
-166
Disposal
-
-70
-70
Currency translation
differences
1
254
255
Closing net book amount
12
13 934
13 946
31.12.2021
Cost
135
14 216
14 351
Accumulated amortization
-123
-282
-405
Net book amount
12
13 934
13 946
11. PROPERTY, PLANT AND EQUIPMENT
The Group’s acquisitions of property, plant and
equipment during 2022 amounted to
USD 5 302 thousand (USD 4 407 thousand in
2021).
During 2022 and 2021 there were no significant
changes at land market, thus land carrying
value as of December 31, 2022 is considered to
be as fair (as of December 31, 2019 land was
revaluated using the market approach by
independent valuators).
in USD thousand
Land
Buildings
Vehicles &
machinery
Furniture,
fittings &
equipment
Construction
in process
Total
31.12.2021
Cost
3 638
6 009
30 796
1 279
1 047
42 769
Accumulated depreciation
-
-1 404
-15 730
-1 090
-
-18 224
Net book amount
3 638
4 605
15 066
189
1 047
24 545
2022
Additions
5
-
3 687
44
1 566
5 302
Disposals
-
-4
-1 701
-13
-
-1 718
Reclassification balance sheet
items/between groups
-
-
338
826
-1 164
-
Depreciation charge
-
-492
-2 236
-72
-
-2 800
Currency translation
differences
-1 004
-931
-3 851
-88
-447
-6 321
Closing net book amount
2 639
3 178
11 303
886
1 002
19 008
31.12.2022
Cost
2 639
4 704
29 093
1 973
1 002
39 411
Accumulated depreciation
-
-1 526
-17 790
-1 087
-
-20 403
Net book amount
2 639
3 178
11 303
886
1 002
19 008
2022 ANNUAL REPORT
PAGE 42
in USD thousand
Land
Buildings
Vehicles &
machinery
Furniture,
fittings &
equipment
Construction
in process
Total
31.12.2020
1
Cost
4 229
11 358
34 818
1 442
1 038
52 885
Accumulated depreciation
-
-4 598
-20 722
-1 220
-
-26 540
Net book amount
4 229
6 760
14 096
222
1 038
26 345
2021
Additions
270
189
3 468
114
366
4 407
Classified as held for sale
-696
-2 179
-575
-
-20
-3 470
Disposals
-5
-16
-94
-1
-
-116
Reclassification balance sheet
items/between groups
-
9
369
3
-381
-
Depreciation charge
-
-684
-2 644
-149
-
-3 477
Currency translation
differences
-160
526
446
-
44
856
Closing net book amount
3 638
4 605
15 066
189
1 047
24 545
31.12.2021
Cost
3 638
6 009
30 796
1 279
1 047
42 769
Accumulated depreciation
-
-1 404
-15 730
-1 090
-
-18 224
Net book amount
3 638
4 605
15 066
189
1 047
24 545
Impairment test was carried out as of
December 31, 2022. The value-in-use method
was applied to determine the recoverable
values of non-current assets. Cash flows were
projected, including revenues, operating
expenses, investment requirements and
working capital needs. The Group applied 5.5%
long-term growth rate. The discount rate
applied was 29.5%. The test demonstrated that
the assets value in use was higher than the
carrying amount of these assets.
For the assets in Ukraine impairment test was
carried out as of December 31, 2021. The
value-in-use method was applied to determine
the recoverable values of non-current assets.
Cash flows were projected, including revenues,
operating expenses, investment requirements
and working capital needs. The Group applied
5% long-term growth rate. The discount rate
applied was 18.5%. The test demonstrated that
the assets value in use was higher than the
carrying amount of these assets.
As of December 31, 2021 assets in milk
production in russia were classified as held for
sale.
Land, buildings, machinery, vehicles and
equipment in Ukraine were pledged at a
carrying value of USD 5 565 thousand (2021:
USD 5 328 thousand).
The net book value of assets leased (vehicles
and machinery) as at December 31, 2022,
stood at USD 1 484 thousand (as at December
31, 2021, USD 1 597 thousand).
11.1 FAIR VALUE OF LAND
The fair value of freehold land as at December
31, 2022, is USD 2 639 thousand (USD 4 334
thousand as at December 31, 2021). Out of
land as of December 31, 2021 USD 696
thousand was classified as held for sale.
Fair value is based on active market prices,
adjusted, if necessary, for any difference in the
nature, location or condition of the specific
asset. If this information is not available, the
Group uses alternative valuation methods,
such as recent prices on less active markets or
discounted cash flow projections. The valuation
of the land in Ukraine as at December 31, 2019
was performed by Company “Proconsul” LLC.
Sales comparison approach was applied for the
land. It is a valuation methodology whereby the
subject property is compared to recently sold
or to sales quotes of properties of a similar
nature with fair value determined through the
application of positive and negative
adjustments for their differing attributes.
Unobservable inputs within the sales
comparison approach:
2022 ANNUAL REPORT
PAGE 43
Size adjustment – the valuer’s assessment of
the price differential between the valued
property and compared property attributable to
their size difference.
Location adjustment – the valuer’s assessment
of the price differential between the valued
property and compared property attributable to
differences in their location.
Bargaining discount – the valuer’s assessment
of the average price discount generally
obtained compared to quoted asking prices of
property.
Relationship of unobservable inputs to fair
value: The fair value measurements listed
above are all sensitive to a significant increase
(decrease) in the unobservable inputs. The
higher the rate per hectare, the higher the fair
value.
If the value per hectare had been 10%
higher/lower, the fair value of land as at
December 31, 2022, would have been USD 264
thousand higher/lower in Ukraine.
During 2022 and 2021 there were no significant
changes at land market. Land was not
revaluated by independent appraisers as of
December 31, 2022. Thus, carrying value of
land as of December 31, 2022 is considered to
be as fair.
12. PREPAID LAND RENTS AND LAND USAGE
RIGHTS
The Group’s land in Ukraine is used mainly
based on lease agreements. The Group has
made prepayments or has recognised land
usage rights in business combinations to get
access to that land in previous periods. These
prepayments and land usage rights are
amortised during the period of the lease.
in USD thousand
31.12.2022
31.12.2021
Balance at the beginning of the period
246
324
Amortization recognised
-27
-89
Unrealised exchange rate differences
-59
11
Balance at the end of the period
160
246
13. TRADE AND OTHER PAYABLES
in USD thousand
31.12.2022
31.12.2021
Trade payables
2 116
638
Prepayments from clients
487
8
Social security and other taxes
1 605
1 720
Accrued expenses
655
1 219
Amounts due to related parties (Note 30)
569
726
Other payables
53
81
5 485
4 392
Less: non-current portion (Note 30)
-4
-3
5 481
4 389
As of December 31, 2022 payables to related
parties are denominated: USD 538 thousand in
Euro and USD 31 thousand in Czech Koruna.
As of December 31, 2021 payables to related
parties are denominated: USD 702 thousand in
Euro and USD 24 thousand in Czech Koruna.
The carrying amounts of the Group’s financial
liabilities (trade and other payables, excluding
prepayments, tax liabilities and payables to
employees) are denominated in the following
currencies:
2022 ANNUAL REPORT
PAGE 44
in USD thousand
31.12.2022
31.12.2021
US dollar
54
-
Ukrainian hryvna
1 447
788
Euro
1 418
847
Czech koruna
51
12
2 970
1 647
14. BORROWINGS
The total borrowings of the Group as at
December 31, 2022, amounted to USD 14 880
thousand (USD 670 thousand as at December
31, 2021).
Details of the borrowings’ currencies, interest
rates, and maturities are shown in the included
tables. Total finance costs in 2022 amounted to
USD 786 thousand (USD 264 thousand in 2021)
(Note 25).
in USD thousand
31.12.2022
31.12.2021
Current
Bank borrowings
12 772
60
Finance lease payables
493
576
13 265
636
Non-current
Bank borrowings
687
-
Finance lease payables
928
34
1 615
34
Total borrowings
14 880
670
31.12.2022, in USD thousand
31.12.2022
Maturity
Interest rate
USD-nominated
2 621
2023-2027
2,8%-3,85%
EUR-nominated
2 086
2023
2,75%
EUR-nominated
82
2023
7days EURIBOR + 1,6%
UAH-nominated
4 449
2023
18%-20%
UAH-nominated
1 668
2023
7% + UIRD (3m)
UAH-nominated
26
2023
1mLIBOR + 4,4%
UAH-nominated
1 395
2025
12,29%-23,01%
UAH-nominated
1 270
2023
1,94%, market rate 18%,
from which the state
compensates 16,06%
(UIRD 3m+5%)
UAH-nominated
1 283
2023
7,05%, market rate 18%,
from which the state
compensates 10,95%
(UIRD 3m)
14 880
Less: non-current portion
1 615
13 265
Less accrued interest
-177
Current portion excl accrued interest
13 088
31.12.2021, in USD thousand
31.12.2021
Maturity
Interest rate
EUR-nominated
60
2022
7days EURIBOR + 1,6%
UAH-nominated
382
2022
2,8%-3,74%
UAH-nominated
228
2023
1mLIBOR + 4,4%
670
Less: non-current portion
34
636
Less accrued interest
-
Current portion excl accrued interest
636
2022 ANNUAL REPORT
PAGE 45
31.12.2022
31.12.2021
Bank
borrowings
Lease
payables
Bank
borrowings
Lease
payables
Floating rate:
– Expiring within one year
4 303
493
60
576
– Expiring beyond one year
-
928
-
34
Fixed rate:
– Expiring within one year
8 469
-
-
-
– Expiring beyond one year
687
-
-
-
13 459
1 421
60
610
31.12.2022
31.12.2021
in USD thousand
Bank
borrowings
Lease
payables
Bank
borrowings
Lease
payables
US dollar
2 621
-
-
-
Euro
2 168
-
60
-
Ukrainian hryvna
8 670
1 421
-
610
13 459
1 421
60
610
in USD thousand
Cash
Leases
due
within 1
year
Leases due after 1
year
Borrow.
due
within 1
year
Borrow.
due after
1 year
Total
Net debt as at 31
December 2022*
1 456
-576
-34
-60
-
786
Cash flows
-1 711
922
-
-11 584
-772
-13 145
Acquisitions-finance
leases and lease
incentives
-
-956
-1 056
-
-
-2 012
Foreign exchange
adjustments
950
154
125
-722
-144
363
Other non-cash
movements
-
-37
37
-229
229
-
Net debt as at 31
December 2022
695
-493
-928
-12 595
-687
-14 008
* Net debt reconciliation is shown excluding the interest liability
2022 ANNUAL REPORT
PAGE 46
in USD thousand
Cash
Leases
due
within 1
year
Leases due after 1
year
Borrow.
due
within 1
year
Borrow.
due after
1 year
Total
Net debt as at 31
December 2020
1
*
7 393
-211
-238
-1 512
-1 636
3 796
Cash flows
-5 906
1 193
-
594
2 078
-2 041
Acquisitions-finance
leases and lease
incentives
-
-1 340
-117
-
-
-1 457
Foreign exchange
adjustments
70
-8
-6
858
-442
472
Other non-cash
movements
-
-240
227
-
-
-13
Classified as assets
held for sale
-101
30
100
-
-
29
Net debt as at 31
December 2021*
1 456
-576
-34
-60
-
786
* Net debt reconciliation is shown excluding the interest liability
Total future finance lease minimum payments
in USD thousand
31.12.2022
31.12.2021
up to 12 months
787
605
1-5 years
1 170
43
1 957
648
Future interests
536
38
Present value of the lease
1 421
610
The fair value of borrowings equals their
carrying amount, as the impact of discounting
is not significant or market rates are not
significantly different from actual borrowing
rates. The borrowings are classified as Level 3
under the fair value hierarchy, as defined by
IFRS 13.
15. INCOME TAX
in USD thousand
2022
2021
Current tax:
Current tax on profits for the year
131
84
Adjustments in respect of prior years
16
128
Income tax expenses from discontinued operations
-
-9
Total current tax
147
203
Deferred tax (Note 16):
Origination and reversal of temporary differences
-3
-6
Transfer to discontinued operations
-
-
Total deferred tax
-3
-6
Income tax expense/(profit)
144
197
The tax on the group’s profit before tax differs from the theoretical amount that would arise using the
weighted average tax rate applicable to profits of the consolidated entities as follows:
2022 ANNUAL REPORT
PAGE 47
in USD thousand
2022
2021
Profit/loss before tax*
-11 060
11 074
Profit/Loss before tax from entities not subject to Income tax by statutory
legislation
-23 843
12 116
Profit/loss before tax from entities subject to income tax
12 783
-1 042
Tax calculated at domestic tax rates applicable to profits in the respective
countries
2 809
284
Tax effects of:
Income not subject to tax
-4 569
-1 126
Expenses not deductible for tax purposes
1 641
602
Utilisation of previously unrecognised tax losses
-
-406
Tax losses for which no deferred income tax asset was recognised
247
724
Adjustments in respect of prior years
16
128
Transfer to discontinued operations
-
-9
Tax charge
144
197
* Profit/loss before tax comprises USD 11 241 thousand from continuing operations and USD (167)
thousand from discontinued operations in 2021
The Group does not have material deferred tax
assets or liabilities in companies, which are
active in agricultural production. This is due to
the following reasons:
1) All of the Group companies in Ukraine that
are producing agricultural produce are not
subject to income tax but to the unified
agricultural tax. The agricultural tax is based on
hectares of arable land the company uses, not
on its earnings and therefore no deferred tax
arises. All other companies in Ukraine
(companies that are related to sales and
trading and storage elevators) are under
regular tax regime and subject to income tax.
2) The Group companies in Czech republic are
subject to income tax at rate 19% . The Group
companies in Czech republic are holding
companies which generate accounting losses.
The non-tax duductible expenses are
permanent (refreshment and non-deductible
part of paid interest) so there are no temporary
differences between the tax and accounting
bases of assets and liabilities
16. DEFERRED TAX
The analysis of deferred tax assets and deferred tax liabilities is as follows:
in USD thousand
2022
2021
Deferred tax assets:
– Deferred tax assets to be recovered after more than 12 months
-
-
– Deferred tax asset to be recovered within 12 months
-
-
-
-
Deferred tax liabilities:
– Deferred tax liability to be recovered after more than 12 months
42
60
– Deferred tax liability to be recovered within 12 months
-
-
42
60
Deferred tax liabilities (net)
42
60
The gross movement on the deferred income tax account is as follows:
2022 ANNUAL REPORT
PAGE 48
in USD thousand
2022
2021
At 1 January
60
63
Currency translation differences
-15
3
Income statement charge related to change in deferred tax assets/ liability
(Note 15)
-3
-6
Tax charge /(credit) relating to components of other comprehensive income
-
-
Classified as associated with assets classified as held for sale
-
-
At 31 December
42
60
Deferred income tax assets are recognized for
tax loss carry-forwards to the extent that the
realization of the related tax benefit through
future taxable profits is probable. The group did
not recognise deferred income tax assets of
USD 251 thousand (USD 693 thousand in
2021) in respect of losses amounting to USD 1
279 thousand (USD 4 673 thousand in 2021)
that can be carried forward against future
taxable income. The accumulated amount of
tax losses where tax asset was not recognized
as at December 31, 2022 was USD 23 449
thousand (2021: USD 25 675 thousand) that
can be carried forward against future taxable
income. Losses amounting to USD 21 953
thousand (USD 25 505 thousand in 2021) have
unlimited usage and the rest of losses will
expire during 1 to 5 years.
The movement in deferred income tax assets and liabilities during the year is as follows:
Deferred tax liabilities
Accelerated
tax
depreciation
Other
Total
At 31 December 2020
1
29
34
63
Charged/(credited) to the income statement
-6
-
-6
Currency translation differences
3
-
3
At 31 December 2021
26
34
60
Charged/(credited) to the income statement
-3
-
-3
Currency translation differences
-15
-
-15
At 31 December 2022
8
34
42
Deferred tax assets
Other
Total
At 31 December 2020
1
-
-
Charged/(credited) to the income statement
-
-
Currency translation differences
-
-
At 31 December 2021
-
-
Charged/(credited) to the income statement
Currency translation differences
-
-
At 31 December 2022
-
-
17. SHARE CAPITAL
in USD thousand
Number of
shares
Incl. ordinary
shares
Share
capital
Share
premium
Total
31.12.2020
1
24 895 123
24 895 123
28 061
171 173
199 234
31.12.2021
74 685 369
74 685 369
8 696
92 263
100 959
31.12.2022
74 685 369
74 685 369
8 696
92 263
100 959
As at December 31, 2022 and as at December
31, 2021, the total number of issued shares was
74,685,369 with a par value of 0.10 EUR (as of
December 31, 2020: 24,895,123 shares with a
par value of 1 EUR per share). All shares have
been fully paid.
In the year 2021 the decision was made to
decrease nominal value of parent company
Agromino A/S share. The nominal value of shares
was decreased from EUR 1 to EUR 0.1 and share
capital was reduced correspondingly from USD
28 061 thousand to USD 2 806 thousand (EUR
24 895 thousand to EUR 2 489 thousand). Such
a decrease resulted in share premium increase
for USD 25 255 thousand (EUR 22 406
thousand) and then share premium increase was
set off against accumulated deficit.
On 1 June 2021, a decision to increase the share
capital to USD 8 696 thousand (EUR 7 469
thousand) by way of a cash contribution of EUR
2022 ANNUAL REPORT
PAGE 49
0.24 per nominally EUR 0.10 new share was
adopted by Agromino’s board of directors.
In August 2021 share premium was set off with
accumulated deficit for amount USD 87 155
thousand (EUR 89 147 thousand).
The shares of Agromino A/S were listed on the
main market of Small Cap segment on NASDAQ
Stockholm. On 15 July 2020, Agromino
announced its plan to apply for delisting of
Agromino’s shares. On 19 October 2020, Nasdaq
Stockholm has approved such application. The
last day of trading of Agromino’s shares was 30
October 2020.
18. OTHER RESERVES
in USD thousand
Revaluation
of land*
Translation
differences
Total
31.12.2020
1
677
-61 306
-60 629
Currency translation differences
-8
967
959
Currency translation difference recycled from
Other Comprehensive Income to Income
Statement in relation to disposal of subsidiary
-
7 789
7 789
31.12.2021
669
-52 550
-51 881
Currency translation differences
-
-18 077
-18 077
Currency translation difference recycled from
Other Comprehensive Income to Income
Statement in relation to disposal of subsidiary
-
10 484
10 484
31.12.2022
669
-60 143
-59 474
As at December 31, 2022, land reserve (related
to land in ownership) amounts to USD 669
thousand (December 31, 2021: USD 669
thousand) included in Other reserves
attributable to the holders of the parent.
19. REVENUE AND OTHER INCOME
in USD thousand
2022
2021
Sales of cereals
33 508
44 997
Sales of milk
1 714
2 047
Revenue from elevator services
62
286
Other revenue
332
520
TOTAL revenue
35 616
47 850
Subsidies
-
-
Other income
91
514
Total other income
91
514
In 2022, 21% of revenue is generated from
sales to customers in Ukraine and 79 % -
export sales (in 2021 – 58 % and 42 %
correspondingly).
Revenues of USD 6 271 thousand (2021: USD
8 740 thousand) are derived from one external
customer, revenues of USD 3 026 thousand
(2021: USD 4 908 thousand) are derived from
the second external customer and revenues of
USD 2 810 thousand (2021: 4 145 thousand)
are derived from the third external customer.
2022 ANNUAL REPORT
PAGE 50
20. RAW MATERIALS AND CONSUMABLES USED
FOR PRODUCTION PURPOSES
in USD thousand
2022
2021
Seeds, fertilizers, chemicals
9 283
10 741
Animal feed
1 242
1 307
Repairs
1 247
1 990
Fuel, gas, electricity
3 640
3 554
Land tax and land rental
812
1 483
Transport services
10 680
3 329
Other services and materials
2 895
3 460
29 799
25 864
21. EMPLOYEE BENEFITS EXPENSE
in USD thousand
2022
2021
Wages and salaries
4 683
6 030
Social security costs
1 015
1 266
5 698
7 296
Remuneration to the Board of Directors and
Executive Board is disclosed in Note 29.
22. RIGHT-OF-USE ASSET AND LEASE
LIABILITY
Amounts recognized in the balance sheet
The balance sheet shows the following amounts relating to land leases:
in USD thousand
31.12.2022
31.12.2021
Right-of-use assets
Land
13 716
16 965
Land usage rights from business acquisition*
5 719
7 569
19 435
24 534
Land lease liabilities
Non-current
13 456
14 805
Current portion
3 048
3 651
Total lease liabilities
16 504
18 456
*The Group has recognized land usage rights
related to the acquisition of Resilient as of the
date of acquisition October 17, 2019. Balance
value of land usage rights acquired was USD 5
719 thousand as of December 31, 2022 (USD
7 569 thousand as of December 31, 2021).
2022 ANNUAL REPORT
PAGE 51
Amounts recognised in the statement of profit or loss
The statement of profit or loss shows the following amounts relating to leases:
in USD thousand
2022
2021
Depreciation charge of right-of-use assets (under IFRS 16)
1 411
1 562
Depreciation charge of land-usage rights from business acquisition
1 391
1 711
Interest expense on land lease liabilities (included in finance cost)
2 968
3 223
Movements for the right-of-use assets were the following:
in USD thousand
2022
2021
Cost as of 1 January
32 230
31 713
Accumulated depreciation
-7 696
-4 779
Net book value as at 1 January
24 534
26 934
Additions to the right-of-use assets
-
-
Depreciation
-2 802
-3 273
Other movements (including changes to agreements)
2 898
2 144
Disposals
-321
-1 204
Currency translation differences
-4 874
-67
Cost as of 31 December
28 362
32 230
Accumulated depreciation
-8 927
-7 696
Net book value as at 31 December
19 435
24 534
Movements for the land lease liability were the following:
in USD thousand
2022
2021
Land lease liability as at 1 January
-18 456
-18 317
Non-current
-14 805
-14 799
Current
-3 651
-3 518
Financial costs from continuing operations
-2 968
-3 204
Financial costs from discontinued operations
-
-19
Other movements (including changes to agreements)
-2 898
-2 144
Disposals
372
1 328
Repayment
2 388
4 463
Currency translation differences
5 058
-563
Land lease liability as at 31 December
-16 504
-18 456
Non-current
-13 456
-14 805
Current
-3 048
-3 651
2022 ANNUAL REPORT
PAGE 52
23. OTHER ADMINISTRATIVE EXPENSES
in USD thousand
2022
2021
Legal and consulting fees
513
628
Office and administration expenses
853
1 126
Other expenses
195
123
1 561
1 877
24. OTHER (LOSSES)/GAINS-NET
in USD thousand
2022
2021
Write down of doubtful receivables and prepayments
-8
-74
Foreign exchange losses/gains net
1 134
296
Gain on disposal of subsidiaries (Note 33)
-
5 849
Currency translation difference recycled from Other Comprehensive Income
to Income Statement in relation to disposal of subsidiaries
-10 484
-7 789
Assets held for sale impairment (Note 32)
-
-5 392
Other losses / gains net
136
10
-9 222
-7 100
25. FINANCE INCOME AND FINANCE COST
in USD thousand
2022
2021
Interest income
155
63
Other financial income
-
-
155
63
Interest expense at effective interest rate:
Finance lease liabilities
-100
-44
Bank borrowings
-686
-220
Lease land liabilities (Note 22)
-2 968
-3 204
Related parties (Note 29)
-18
-2 271
Other finance costs
-3
-16
-3 775
-5 755
26. CONTINGENCIES
TAXES
UKRAINE:
Tax legislation. Ukrainian tax, currency, and
customs legislation is subject to varying
interpretations, and changes, which can occur
frequently. Management’s interpretation of
such legislation as applied to the transactions
and activity of the Group may be challenged by
the relevant regional and central authorities.
The tax authorities in Ukraine may be taking a
more assertive position in their interpretation
of the legislation and assessments, and it is
possible that transactions and activities that
have not been challenged in the past may be
challenged. As a result, significant additional
taxes, penalties, and interest may be assessed.
Fiscal periods remain open to review by the
authorities in respect of taxes for three
calendar years preceding the year of review.
Under certain circumstances, reviews may
cover longer periods.
The tax consequence of transactions for
Ukrainian taxation purposes is frequently
determined by the form in which transactions
are documented and the underlying accounting
treatment prescribed by Ukrainian GAAP.
One of the Group companies acts as claimant
in lawsuit with the tax authorities. Based on the
results of the documentary inspection
concerning the period from October 1, 2016 to
September 30, 2019, the State Tax Authority
2022 ANNUAL REPORT
PAGE 53
of Ukraine in Kyiv issued tax decision regarding
decrease in negative value of object of
corporate income tax in the total amount of
USD 3 461 thousand. The same decision also
set out that the respective Group company’s
VAT liability should increase by the amount of
USD 97 thousand and should pay penalties in
the total amount of USD 37 thousand.
The Group disagreed with assessment made by
the State Tax Authority in Kyiv and,
accordingly, respective Group company filed an
administrative lawsuit with the District
Administrative Court of Kyiv to cancel the
above decisions.
On December 8, 2020, the District
Administrative Court of Kyiv decided to cancel
part of the decision concerning the income tax
and maintained in force part concerning the
VAT assessment.
This decision was appealed by the Group (in
part concerning the VAT) and was upheld by
the decision of the Sixth Appeal Administrative
Court on April 6, 2021.
Negative consequences of the decision on the
Group in part concerning VAT were reflected by
the respective Group company in its financial
statements in April 2021 and the corresponding
amounts of payments were paid to the state
budget. However, the Group company filed a
cassation appeal to the Supreme Court of
Ukraine and is persuaded that the assessment
of the case made by the first instance court and
appellate court was incorrect and, hence,
decisions will be overturned by the Supreme
Court of Ukraine. If that will occur, the VAT
payments made by the company in April 2021
will be returned to the company.
27. COMMITMENTS
Within the framework of the share purchase
agreement (SPA) for the acquisition of 100% of
shares of Resilient a.s. (Shares) in October
2019 a pledge over the Shares was established
by the Company in favour of Mabon investiční
fond s proměnným kapitálem a.s. (Mabon).
Mabon is controlled by Mr. Petr Krogman, who
is also the Chairman of the Agromino‘s Board
of Directors.
The pledge shall secure potential future
liabilities of the Company towards Mabon which
may arise mainly in case of substantial breach
of limited warranties by Agromino under the
SPA. No liabilities towards Mabon under the
framework of the SPA exist on the date of this
report. The Company assesses the risk of
origination of substantial liabilities under the
framework of the SPA as very low.
Consequently, the Company assesses the risk
of pledge realization as very low.
During the process of the SPA negotiation
applicable disqualification rules were respected
by the Company.
2022 ANNUAL REPORT
PAGE 54
28. GROUP STRUCTURE
The Group’s parent company Agromino A/S
registered in Denmark.
As of December 31, 2022, and 2021, the Group included the following companies:
Country of
registration
Segment
Ownership
percentage
in 2022
Ownership
percentage
in 2021
Legal
Status in
the Group
Agromino A/S
Denmark
-
100%
100%
Parent
company
LLC Trigon Farming Kharkiv
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Trigon Agro 2
Ukraine
Ukraine
100%
100%
Subsidiary
Private Enterprise Trigon Farming
Molniya
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Trigon Farming
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Trigon-Export
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Kovyagovskoye Zerno
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Kovyaqovskoуe
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Vovchanskiy Combinat
Khliboproduktiv
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Resilient
Ukraine
Ukraine
99.99%
99.99%
Subsidiary
LLC Resilient Agro
Ukraine
Ukraine
100%
100%
Subsidiary
Private Rental Agricultural
Enterprise Sydory
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Oliynykova Sloboda,
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Resilient Pryvitiv
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Resilient Stara Synyava
Ukraine
Ukraine
100%
100%
Subsidiary
Private enterprise, Trans Agro
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Resilient Matyushi
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Saturn Agrokom
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Agrocompany Bilotserkivska
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Resilient Bilotserkivska
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Pryvitivske
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Agrocompany Matyushi
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Resilient Oliynykova Sloboda
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Resilient Sydory
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Trigon Moloko
russia
Milk production
-
100%
Subsidiary
LLC Dobruchi-2
russia
Milk production
-
100%
Subsidiary
Resilient a.s.
Czech
Republic
-
100%
100%
Subsidiary
TC Farming Ukraine Ltd.
Cyprus
-
100%
100%
Subsidiary
TC Farming Russia Ltd.
Cyprus
-
100%
100%
Subsidiary
Trigon Farming Aktsiaselts.
Estonia
-
-
100%
Subsidiary
In the year ended December 31, 2022 the Group
divested group companies LLC Trigon Moloko,
LLC Dobruchi-2, and liquidated company Trigon
Farming Aktsiaselts.
In the year ended December 31, 2021 the Group
divested group companies LLC Agro Capital
Center, LLC Yavkino Holding, OJSC Yavkinskiy
elevator, LLC Resilient Gorodylovychi (Note 32),
LLC Kirovograd agroinvestment company
(immaterial net assets as of the date of
disposal), LLC Gorodylovychi (immaterial net
assets as of the date of disposal). Trigon Dairy
Farming Ltd. was merged to Trigon Farming
Aktsiaselts, company Rimela International s.r.o.
was merged to Resilient a.s. in 2021.
2022 ANNUAL REPORT
PAGE 55
29. RELATED PARTY TRANSACTIONS
Related parties comprise of companies which are
controlled by the Group´s management
personnel or the members of the Board of
Directors.
During the reporting period the Group had not
sales and purchases operations with related
parties.
The following table sets forth the aggregate gross amounts of salaries and other remuneration by the
Group to the members of its Board of Directors and Executive Board in 2022 and in 2021.
in USD thousand
Salary (incl
social security
costs)
Total
2022
Members of Board of Directors
13
13
Members of the Executive Board
263
263
276
276
2021
Members of Board of Directors
51
51
Members of the Executive Board
273
273
324
324
As of December 31, 2022, the Group had
liability to Board of Directors members in the
amount of USD 3 thousand (USD 12 thousand
as of December 31, 2021)
Loans payable with related parties (Companies under control of Members
of Board of Directors)
in USD thousand
2022
2021
Beginning of the year
726
15 311
Loans advanced
4
8 012
Loan repayments made
-137
-23 125
Interest charged
18
426
Long-term loan discount write off
-
1 871
Interest paid
-1
-1 224
Currency translation differences
-46
-545
End of the period
564
726
Loans receivable towards related parties (Companies under control of
Members of Board of Directors)
2 660
352
Loans from related parties have maturity within
year 2023. Interest rate is 5% per loan
contracts (5 % in 2021).
Long-term loans from related parties as of
December 31, 2020 were measured at their fair
value by discounting them at the effective rate
6.71%. In 2021 long-term loans were fully
repaid.
2022 ANNUAL REPORT
PAGE 56
30. FEES TO THE AUDITORS APPOINTED BY THE
SHAREHOLDERS
In 2022 and 2021 expenses to auditors were:
in USD thousand
2022
2021
Audit, assurance engagements and other services
77
107
31. ASSETS HELD FOR SALE AND LIABILITIES
ASSOCIATED
As of December 31, 2021 assets and liabilities of
subsidiaries in russia (LLC Trigon Moloko and
LLC Dobruchi-2) were classified as assets held
for sale, since Management of the Group had
intentions to sell russian milk production
segment and assessment of the sale could be
considered as highly probable.
The major classes of assets and liabilities of
subsidiaries to be disposed as of December 31,
2021 were as follows:
in USD thousand
31 December
2021
Cash and cash equivalents
101
Trade and other receivables
189
Inventories
1 026
Biological assets
3 157
Property, plant and equipment
3 470
Total assets classified as held for sale
7 943
Trade and other payables
-251
Lease liability (current and non-current)
-128
Deferred tax liabilities
-54
Total liabilities associated with assets
classified as held for sale
-433
Net assets of disposal group
7 510
Assets held for sale impairment
-5 392
Net assets of disposal group after impairment
2 118
Intragroup accounts receivable and payable
eliminated on consolidation, net
-15 739
Net assets of disposal group were impaired to
its recoverable value as at December 31, 2021.
Amount of consideration to be expected to be
received by the Group as a result of net assets
disposal is considered as recoverable. Thus,
impairment in amount USD 5 392 thousand
was recognized in 2021.
The combined results of the discontinued
operations are set out below.
2022 ANNUAL REPORT
PAGE 57
Results from discontinued operations for year ended 31 December:
in USD thousand
2022
2021
Discontinued operations:
Revenue
1 267
3 172
Other income
108
219
Gain/loss of biological assets arising from changes in fair value less cost to
sell
310
945
Total revenue, other income and fair value adjustments
1 685
4 336
Net changes in inventories of agricultural produce and work in
process
128
1 624
Cost of purchased goods for trading purposes
-
-
Raw materials and consumables used for production purposes
-1 362
-4 251
Employee benefits expense
-236
-919
Depreciation and amortization
-119
-604
Other administrative expenses
-21
-91
Other (losses)/gains - net
-14
5
61
100
Gains/losses from exchange rate differences
-
-5
Finance income
-
-
Finance costs (Note 22)
-
-262
Share of profit/loss of investments accounted for using the equity method
-
-
Profit/loss before income tax
61
-167
Corporate income tax
-
-7
Profit/loss for the period from
61
-174
Cash flows from discontinued operations for year ended 31 December
in USD thousand
2022
2021
Net cash (outflows)/inflows from operating activities
55
-367
Net cash outflows from investing activities
-26
-114
Net cash inflows/(outflows) from financing activities
-24
-28
Net decrease in cash and cash equivalents
5
-509
2022 ANNUAL REPORT
PAGE 58
32. DISPOSAL OF SUBSIDIARIES
In June 2022 a share purchase agreement for
the sale of company LLC “Trigon Moloko”
(russian milk segment, since LLC “Trigon
Moloko” is 100 % holder of LLC Dobruchi-2) has
been signed. The consideration for sale of
russian milk segment was USD 2,1 million (RUB
101 thousand for sale of LLC “Trigon Moloko”
corporate rights and EUR 2 000 thousand for
further sale of receivables from LLC “Dobruchi-
2” by the Group).
In April 2021 the Group divested group
companies LLC Agro Capital Center, LLC
Yavkino Holding, OJSC Yavkinskiy elevator, LLC
Resilient Gorodylovychi.
The net assets of subsidiaries disposed at the
date of disposal were as follows:
in USD thousand
2022
2021
ASSETS
Current assets
Cash and cash equivalents
200
39
Trade and other receivables
307
194
Inventories
595
562
Biological assets
417
1 758
Current assets
1 519
2 553
Other non-current prepayments and receivables
-
5
Intangible assets
-
255
Property, plant and equipment
3 104
1 017
Biological assets
2 881
-
Right-of-use asset
-
5 935
Non-current assets
5 985
7 212
Total assets
7 504
9 765
LIABILITIES
Borrowings
27
-
Trade and other payables
298
3 620
Current portion of lease liability
-
1 000
Current liabilities
325
4 620
Borrowings
81
-
Trade and other payables
63
-
Lease liability
-
4 715
Deferred tax liabilities
-
128
Non-current liabilities
144
4 843
Total liabilities
469
9 463
Impairment
-5 013
-
Net assets derecognized
2 022
302
Consideration received:
Cash
2 022
6 151
in USD thousand
2022
2021
Consideration received
2 022
6 151
Net assets derecognized
-2 022
-302
Gain on disposal (Note 24)
-
5 849
Currency translation difference recycled from Other
Comprehensive Income to Income Statement in
relation to disposal of subsidiary (Note 24)
-10 484
-7 789
Result of subsidiaries disposal
-10 484
-1 940
2022 ANNUAL REPORT
PAGE 59
33. EVENTS AFTER THE BALANCE SHEET DATE
The Group finished its spring sowing campaign
successfully and is preparing for its harvesting
campaign.
In 2023 the Group obtained VAT budget
compensation in amount USD 3 016 thousand
(UAH 110 296 thousand).
Management continues to support fruitful
relationships with banks. In 2023 the Group
obtained bank loans in following amounts: USD
1 578 thousand and EUR 1 491 thousand. Also
after the balance sheet date, Group obtained
property, plant and equipment in finance lease.
Also prolongation additional agreements were
signed with banks in the beginning of 2023.
Russian war against Ukraine continues. The
final resolution and the effects of these events
are difficult to predict, but they may have
further severe effects on the Ukrainian
economy and the Group’s business.
Management continues to make efforts to
identify and mitigate impacts to the Group,
however, there are factors beyond its
knowledge or control, including the duration
and severity of warfare, as well as further
governmental and diplomacy actions taken.
2022 ANNUAL REPORT
PAGE 60
FINANCIAL STATEMENTS OF THE PARENT
COMPANY
STATEMENT OF FINANCIAL POSITION OF THE
PARENT COMPANY
in USD thousand
Note
31.12.2022
31.12.2021
ASSETS
Current assets
Cash and cash equivalents
5
10
66
Trade and other receivables
7
4 020
3 930
4 030
3 996
Non-current assets
Investments in subsidiaries
6
36 189
56 423
36 189
56 423
Total assets
40 219
60 419
LIABILITIES
Current liabilities
Trade and other payables
8
238
3 510
Borrowings
9
33
1 141
271
4 651
Non-current liabilities
Borrowings
9
-
-
-
-
Total liabilities
271
4 651
EQUITY
Capital and reserves attributable to equity
holders of the Company
Ordinary shares
10
8 696
8 696
Share premium
10
92 263
92 263
Other reserves
-46 631
-43 222
Accumulated deficit
-14 380
-1 969
Total equity
39 948
55 768
Total equity and liabilities
40 219
60 419
The notes on pages 63 to 71 are an integral part of the parent company financial statements.
2022 ANNUAL REPORT
PAGE 61
STATEMENT OF THE COMPREHENSIVE INCOME OF
THE PARENT COMPANY
in USD thousand
Note
2022
2021
Revenues
11
5
12
Other income
-
-
Employee benefits expense
12
-256
-251
Other expenses
-366
-249
Impairment losses
14
-8 333
-1 865
Gains/losses from exchange rate differences
82
180
Interest income
13
97
75
Interest expense
13
-16
-252
Profit/loss from sale of investments
-3 608
584
Net loss before income tax
-12 395
-1 766
Corporate income tax
-16
-203
Net loss for the period
-12 411
-1 969
Other comprehensive income
-3 409
-4 200
Total comprehensive loss for the period
-15 820
-6 169
STATEMENT OF CHANGES IN EQUITY FOR THE
PARENT COMPANY
In USD thousand
Share
capital
Share
premium*
Other
reserves
Accumulated
deficit
Total
Balance at 31.12.2020
1
28 061
171 173
-39 022
-112 410
47 802
Shares nominal value decrease
-25 255
-
-
25 255
-
Issuance of share capital
5 890
8 245
-
-
14 135
Total comprehensive income (loss) for the period
-
-
-4 200
-1 969
-6 169
Transfer between equity elements
-
-87 155
-
87 155
-
Balance at 31.12.2021
8 696
92 263
-43 222
-1 969
55 768
Shares nominal value decrease
-
-
-
-
-
Issuance of share capital
-
-
-
-
-
Total comprehensive income (loss) for the period
-
-
-3 409
-12 411
-15 820
Transfer between equity elements
-
-
-
-
-
Balance at 31.12.2022
8 696
92 263
-46 631
-14 380
39 948
* Share premium can be distributed as dividend.
The notes on pages 63 to 71 are an integral part of the parent company financial statements.
2022 ANNUAL REPORT
PAGE 62
STATEMENT OF CASH FLOWS OF THE PARENT
COMPANY
In USD thousand
Note
2022
2021
Cash flows from operating activities
Cash receipts from customers
11
119
21
Cash paid to suppliers and employees
12,13,16
-647
-488
Income tax paid
-82
-129
Net cash used in/generated from operating
activities
-610
-596
Cash flows from investing activities
Contribution to share capital of subsidiary
15
-
-5 874
Acquisition of subsidiary, net of cash acquired
15
-
-
Sale of subsidiary
-
620
Loans issued to subsidiaries
15
-1 837
-1 194
Loans issued to related parties
15
-230
-601
Proceeds from share capital decrease of subsidiary
-
296
Proceeds from loan repayments from subsidiaries
15
2 158
260
Proceeds from interest repayments from subsidiaries
15
608
231
Net cash used in/generated from investing
activities
699
-6 262
Cash flows from financing activities
Loans received from subsidiaries
15
-
59
Loans received from related parties
15
4
4 152
Loans repaid to subsidiaries
15
-5
-2 363
Interest repaid to subsidiaries
15
-
-7
Loans repaid to related parties
15
-137
-8 680
Interest repaid to related parties
-2
-413
Shares issue
-
14 134
Net cash generated from used in financing
activities
-140
6 882
Net increase in cash and cash equivalents
-51
24
Effects of exchange rate changes on cash and cash
equivalents
-5
-8
Cash and cash equivalents at beginning of period
5
66
50
Cash and cash equivalents at end of period
5
10
66
The notes on pages 63 to 71 are an integral part of the parent company financial statements.
2022 ANNUAL REPORT
PAGE 63
NOTES TO THE FINANCIAL STATEMENTS OF
THE PARENT COMPANY
1. GENERAL INFORMATION
The Company was established on December
11, 2006. Agromino A/S (“the Company”) is
the parent company of the Agromino Group.
The Company is a limited liability company
incorporated and domiciled in Denmark. The
address of its registered office is c/o
Advokatfirmaet Poul Schmith, Kalvebod Brygge
32, DK-1560, Copenhagen, Denmark.
The Parent Company has in 2011 established a
branch "Agromino Eesti Filiaal" in Estonia.
The Company prepares its separate financial
statements in accordance with IFRS and further
requirements in the Danish Financial
Statements Act.
The principal accounting policies applied in the
preparation of these financial statements are
set out below.
2. ACCOUNTING PRINCIPLES
Basis of preparation of the financial statements
of the parent company
The financial statements of Agromino A/S have
been prepared in accordance with International
Financial Reporting Standards, as adopted by
the EU (IFRS) and further requirements in the
Danish Financial Statements Act. The parent
company has applied the same accounting
policies as the Group, except for the
investments in subsidiaries as described below.
See Note 2 to the Consolidated Financial
Statements, for the summary of significant
accounting policies of the Group.
Long-term investments in subsidiaries and
associate companies
In the separate financial statements of the
parent company, the investments in
subsidiaries are recognised and measured at
cost. Equity interests in foreign currencies are
translated to the reporting currency using the
historical exchange rate prevailing at the time
of the transaction. Where cost exceeds the
recoverable amount, the carrying value is
written down to the recoverable amount.
Dividends from investments in subsidiaries,
joint ventures, and associates are recognized
as income in the financial year when the
dividends are distributed.
3. CRITICAL ACCOUNTING ESTIMATES
An impairment test was performed at
investments in subsidiaries as at December 31,
2022 and December 31, 2021.
Based on the test performed impairment of
investments in Cyprus subsidiary and Czech
Republic subsidiary, holding investments in
Ukraine subsidiaries, was recognized in 2022
(Note 14). The impairment test has shown a
need for impairment, as the expected operating
profit does not currently correspond to the
increased investments in Resilient a.s.
The parent company has applied 5.5% long-
term growth rate that has been aggregated
from the long-term growth perspective in the
respective country and estimation of the
growth in food prices in relation to other inputs.
The discount rate applied 29,5%.
In the model target yields and prices were used
based on forecasts prepared on current
situation and assumption that the degree of
intensity of military hostilities in the regions
where the subsidiaries assets are located and
the area of the Ukrainian territory currently
invaded by the russian troops will be not
2022 ANNUAL REPORT
PAGE 64
increased; company’s subsidiaries are able to
carry out sowing and harvesting of crops; the
railway infrastructure performs its function and
is used as a way of executing export sales due
to limitation of seaports usage.
However, material uncertainty in the future
exists just because of external factors which
are out of Management influence, namely
military actions occurring in Ukraine. War of
russia in Ukraine can have impact on significant
assumptions, used in Parent company’s and
Group’s forecasts, and thus recoverable values
of investments in subsidiaries can be changed.
Effect of such impact cannot be predicted.
Based on the test performed impairment of
investments in Cyprus subsidiary and russian
subsidiary was recognized in 2021 (Note 14).
The parent company has in the model as at
December 31, 2021 used its target yields and
prices for cereals and milk based on forecasts.
The parent company has applied 5.0% long-
term growth rate that has been aggregated
from the long-term growth perspective in the
respective country and estimation of the
growth in food prices in relation to other inputs
for Ukrainian segment. The discount rates
applied in Ukraine 18,5%.
4. FINANCIAL RISK MANAGEMENT
Financial risk management principles of
Agromino A/S correspond to the principles used
for the whole Group. For further information on
the financial risk management principles used
please refer to the consolidated financial
statements Note 3. For details concerning the
parent company please refer to the other Notes
of the financial statements of the parent
company.
The Company is exposed to foreign exchange
risk arising primarily from exposures to the US
dollar. Refer to Notes 7,8,9 for the amounts of
assets and liabilities nominated in the US
dollar.
5. CASH AND CASH EQUIVALENTS OF THE PARENT
COMPANY
in USD thousand
31.12.2022
31.12.2021
Cash at bank and on hand
10
66
10
66
As at December 31, 2022 (and December 31, 2021) there was no cash on bank deposits. The credit
rating (Moody`s) of the banks where the cash was held was A1 for USD 9 thousand and Aa3 for USD
1 thousand.
6. LONG TERM INVESTMENTS IN SHARES OF
SUBSIDIARIES
Breakdown of investments in subsidiaries by companies is given in the table below:
in USD thousand
31.12.2022
31.12.2021
TC Farming Ukraine Ltd.
2
13
Trigon Farming Ltd.
-
18 724
LLC Trigon Moloko
-
1
LLC Kovyaqovskoуe
2 403
2 552
RESILIENT A.S.
20 428
20 952
LLC Trigon Farming Kharkiv
8 505
9 031
CJSC Vovchanskiy Combinat Khliboproduktiv
1 896
2 013
Private Enterprise Trigon Farming Molniya
1 667
1 770
LLC Trigon Farming
747
793
LLC Kovyagivske Zerno
534
567
LLC Trigon Agro 2
7
7
36 189
56 423
2022 ANNUAL REPORT
PAGE 65
During 2022 the Company has made non-
monetary share capital contribution into
subsidiary in amount of USD 9 012 thousand
(EUR 8 558 thousand).
In 2022 the Company sold its share in LLC
Trigon Moloko. Subsidiary Trigon Farming Ltd.
was liquidated in 2022.
During 2021 the Company has made share
capital contributions into subsidiaries in
amount of USD 6 639 thousand (EUR 5 613
thousand), including non-monetary
contribution in amount of USD 768 thousand.
In 2021 the Company sold its share in LLC Agro
Capital Center and in LLC Resilient
Gorodylovychi. Subsidiary Ltd Trigon Dairy
Farming was merged to Trigon Farming Ltd,
company Rimela International s.r.o. was
merged to Resilient a.s..
Impairment of investments in subsidiaries have
been recognized in 2022 and 2021 (Note 14).
.
As of December 31, 2022, the parent company owned directly the following companies:
2022
Country of
registration
Segment
Ownership
persentage
Legal Status
in the Group
LLC Kovyaqovskoуe
Ukraine
Ukraine
100%
Subsidiary
LLC Kovyaqovskoуe Zerno
Ukraine
Ukraine
100%
Subsidiary
LLC Trigon Farming Kharkiv
Ukraine
Ukraine
99,87%
Subsidiary
CJSC Vovchanskiy Combinat
Khliboproduktiv
Ukraine
Ukraine
100%
Subsidiary
Private Enterprise Trigon
Farming Molniya
Ukraine
Ukraine
100%
Subsidiary
LLC Trigon-Export
Ukraine
Ukraine
0,03%
Minority
interest
LLC Trigon Farming
Ukraine
Ukraine
100%
Subsidiary
LLC Trigon Agro 2
Ukraine
Ukraine
8,78%
Minority
interest
Resilient a.s.
Czech Republic
-
100%
Subsidiary
TC Farming Ukraine Ltd.
Cyprus
-
100%
Subsidiary
TC Farming Russia Ltd.
Cyprus
-
100%
Subsidiary
As of December 31, 2021, the parent company owned directly the following companies:
2021
Country of
registration
Segment
Ownership
persentage
Legal Status
in the Group
LLC Kovyaqovskoуe
Ukraine
Ukraine
100%
Subsidiary
LLC Kovyaqovskoуe Zerno
Ukraine
Ukraine
100%
Subsidiary
LLC Trigon Farming Kharkiv
Ukraine
Ukraine
99,87%
Subsidiary
CJSC Vovchanskiy Combinat
Khliboproduktiv
Ukraine
Ukraine
100%
Subsidiary
Private Enterprise Trigon
Farming Molniya
Ukraine
Ukraine
100%
Subsidiary
LLC Trigon-Export
Ukraine
Ukraine
0,03%
Minority
interest
LLC Trigon Farming
Ukraine
Ukraine
100%
Subsidiary
LLC Trigon Agro 2
Ukraine
Ukraine
8,78%
Minority
interest
LLC Trigon Moloko
russia
Milk production
99%
Subsidiary
Resilient a.s.
Czech Republic
-
100%
Subsidiary
Trigon Farming Ltd.
Estonia
-
100%
Subsidiary
TC Farming Ukraine Ltd.
Cyprus
-
100%
Subsidiary
TC Farming Russia Ltd.
Cyprus
-
100%
Subsidiary
2022 ANNUAL REPORT
PAGE 66
7. TRADE AND OTHER RECEIVABLES
in USD thousand
31.12.2022
31.12.2021
Current receivables:
Receivables from subsidiaries (Note 15)
1 406
1 430
Short-term loans given to subsidiaries (Note 15)
2 009
2 139
Short-term loans given
591
359
Total current receivables
4 006
3 928
Current prepayments:
Prepayments
-
-
Prepayments for indirect taxes
14
2
14
2
Total current receivables and prepayments
4 020
3 930
Breakdown of the receivables from subsidiaries and group companies by companies is given below:
in USD thousand
31.12.2022
31.12.2021
TC Farming Ukraine Ltd.
10
1 463
Trigon Dairy Farming Ltd.
-
1 274
LLC Trigon Farming Kharkiv
1 462
29
LLC Dobruchi
-
5
TC Farming Russia Ltd
30
46
Resilient a.s.
1 913
752
Total receivables
3 415
3 569
During 2022 and 2021 no receivables or loans
from the group companies were impaired.
Trade and other receivables are not due as at
December 31, 2022, and December 31, 2021.
The carrying amounts of the trade and other receivables were denominated in the following
currencies:
in USD thousand
31.12.2022
31.12.2021
US dollar
-
1 462
Czech koruna
52
116
Euro
3 968
2 352
4 020
3 930
2022 ANNUAL REPORT
PAGE 67
8. TRADE AND OTHER PAYABLES
in USD thousand
31.12.2022
31.12.2021
Trade payables
3
2
Trade payables to related parties (Note 15)
-
3 277
Social security and other taxes
5
79
Accrued expenses
115
129
Amounts due to related parties (Note 15)
115
23
238
3 510
Less: non-current portion
-
-
238
3 510
The carrying amounts of the trade and other payables were denominated in the following currencies:
in USD thousand
31.12.2022
31.12.2021
US dollar
-
-
Euro
238
3 510
238
3 510
9. BORROWINGS
in USD thousand
31.12.2022
31.12.2021
Current
Borrowings from subsidiaries (Note 15)
-
965
Borrowings from Related parties (Note 15)
33
176
Finance lease payables
-
-
33
1 141
Non-current
Borrowings from Related parties (Note 15)
-
-
-
-
Total borrowings
33
1 141
in USD thousand
31.12.2022
31.12.2021
Euro
33
1 141
33
1 141
10. SHARE CAPITAL OF THE PARENT COMPANY
in USD thousand
Number of
shares
Incl.
ordinary
shares
Share
capital
Share
premium
Total
31.12.2020
1
24 895 123
24 895 123
28 061
171 173
199 234
31.12.2021
74 685 369
74 685 369
8 696
92 263
100 959
31.12.2022
74 685 369
74 685 369
8 696
92 263
100 959
2022 ANNUAL REPORT
PAGE 68
As at December 31, 2022 and as at December
31, 2021, the total number of issued shares was
74,685,369 with a par value of 0.10 EUR (as of
December 31, 2020: 24,895,123 shares with a
par value of 1 EUR per share). All shares have
been fully paid.
In the year 2021 the decision was made to
decrease nominal value of parent company
Agromino A/S share. The nominal value of
shares was decreased from EUR 1 to EUR 0.1
and share capital was reduced correspondingly
from USD 28 061 thousand to USD 2 806
thousand (EUR 24 895 thousand to EUR 2 489
thousand). Such a decrease resulted in share
premium increase for USD 25 255 thousand
(EUR 22 406 thousand) and then share
premium increase was set off against
accumulated deficit.
On 1 June 2021, a decision to increase the share
capital to USD 8 696 thousand (EUR 7 469
thousand) by way of a cash contribution of EUR
0.24 per nominally EUR 0.10 new share was
adopted by Agromino’s board of directors.
In August 2021 share premium was set off with
accumulated deficit for amount USD 87 155
thousand (EUR 89 147 thousand).
The shares of Agromino A/S were listed on the
main market of Small Cap segment on NASDAQ
Stockholm. On 15 July 2020, Agromino
announced its plan to apply for delisting of
Agromino’s shares. On 19 October 2020,
Nasdaq Stockholm has approved such
application. The last day of trading of
Agromino’s shares was 30 October 2020.
11. REVENUE
in USD thousand
2022
2021
Sales of services
5
12
TOTAL revenue
5
12
Sale of services includes revenue from related
parties in amount USD 5 thousand (2021: USD
12 thousand) (Note 15)
12. EMPLOYEE BENEFITS EXPENSE
in USD thousand
2022
2021
Fees of Members of Board of Directors and
Executive Board (Note 15)
122
146
Social security costs related to fees of Members of
Board of Directors and Executive Board (Note 15)
66
34
188
180
Wages and salaries
51
53
Social security costs
17
18
68
71
256
251
2022 ANNUAL REPORT
PAGE 69
13. FINANCE INCOME AND FINANCE COST
in USD thousand
2022
2021
Interest income from group companies (Note 15)
78
71
Interest income from related parties (Note 15)
19
4
TOTAL interest income
97
75
Interest expense from group companies (Note 15)
-14
-43
Interest expense from related parties (Note 15)
-2
-209
TOTAL interest expense
-16
-252
14. IMPAIRMENT LOSSES
in USD thousand
2022
2021
Impairment of investments (Note 6)
-8 333
-1 865
-8 333
-1 865
15. RELATED PARTY TRANSACTIONS
in USD thousand
Sales and purchases
2022
2021
Sale of services to group companies (Note 11)
5
12
Including re-charged expenses
1
1
Interest income from group companies (Note 13)
78
71
Interest income from related parties (Note 13)
19
4
Interest expense from group companies (Note 13)
-14
-43
Interest expense from related parties (Note 13)
-2
-209
Cash flow transactions
Contribution to share capital of subsidiary
-
-5 874
Loans issued to subsidiaries
-1 837
-1 194
Loans issued to related parties
-230
-601
Loans received from subsidiaries
-
59
Loans received from related parties
4
4 152
Loans repaid to subsidiaries
-5
-2 363
Interest repaid to subsidiaries
-
-7
Loans repaid to related parties
-137
-8 680
Interest repaid to related parties
-2
-413
The following table sets forth the aggregate
gross amounts of salaries and other
remuneration to the Board of Directors and
Executive Board in 2022 and 2021.
.
2022 ANNUAL REPORT
PAGE 70
in USD thousand
Salary (incl
social security
costs)
Total
2022
Members of Board of Directors
12
12
Members of the Executive Board
176
176
188
188
2021
Members of Board of Directors
51
51
Members of the Executive Board
129
129
180
180
Balances from subsidiaries and other group companies
in USD thousand
31.12.2022
31.12.2021
Receivables (Note 7)
1 406
1 430
Loan receivables (Note 7)
2 009
2 139
Payables (Note 8)
115
3 299
Borrowings (Note 9)
-
965
Balances from other related parties
31.12.2022
31.12.2021
Payable to related parties
33
176
16. FEES TO THE AUDITORS OF THE PARENT COMPANY
in USD thousand
2022
2021
Audit
-72
-96
-72
-96
17. COMMITMENTS
Surety agreement was concluded between the
Company and JSC «UKRSIBBANK» on 28
August 2015. Under surety agreement
Agromino A/S shall be liable to the Bank in
case of breach of the Debt obligations by its
subsidiaries under Loan Agreement
#11463843000 dated 23 December 2013 with
general loan limit USD 7 000 thousand.
Surety agreement #253 CL/S2 was concluded
between the Company and JSC “CREDIT
AGRICOLE BANK” on 12 February 2019. Under
surety agreement Agromino A/S shall be liable
to the Bank in case of breach of the Debt
obligations by its subsidiaries under
Agreement on rendering of banking services
#253 CL dated 07 December 2012 with
general loan limit USD 8 000 thousand.
Surety agreement #463 CL/S1 was concluded
between the Company and JSC “CREDIT
AGRICOLE BANK” on 14 January 2022. Under
surety agreement Agromino A/S shall be liable
to the Bank in case of breach of the Debt
obligations by its subsidiaries under
Agreement #463 CL dated 14 January 2022
with general loan limit USD 10 000 thousand.
Surety agreement #070722 was concluded
between the Company and “Raiffeisen Bank”
2022 ANNUAL REPORT
PAGE 71
on 7 July 2022. Under surety agreement
Agromino A/S shall be liable to the Bank in
case of breach of the Debt obligations by its
subsidiaries under Agreement # 010/150-
2/304 dated 25 January 2017 with general
loan limit EUR 15 000 thousand. On 16 May
2023 new Surety agreement # 160523
(instead of previous one) was concluded for
general loan limit EUR 4 000 thousand.
Within the framework of the share purchase
agreement (SPA) for the acquisition of 100%
of shares of Resilient a.s. in the end of the year
2019 (Shares) a pledge over the Shares was
established by the Company in favor of Mabon
investiční fond s proměnným kapitálem a.s.
(Mabon). Mabon is controlled by Mr. Petr
Krogman, who is also the Chairman of the
Agromino‘s Board of Directors.
The pledge shall secure potential future
liabilities of the Company towards Mabon
which may arise mainly in case of substantial
breach of limited warranties by Agromino
under the SPA. No liabilities towards Mabon
under the framework of the SPA exist on the
date of this report. The Company assesses the
risk of origination of substantial liabilities
under the framework of the SPA as very low.
Consequently, the Company assesses the risk
of pledge realization as very low.
During the process of the SPA negotiation
applicable disqualification rules were
respected by the Company.
2022 ANNUAL REPORT
PAGE 72
MANAGEMENT´S STATEMENT
July 3, 2023
__________________ __________________ ___________________
__________
__________________ _________________________
2022 ANNUAL REPORT
PAGE 73
INDEPENDENT AUDITOR´S REPORT
2022 ANNUAL REPORT
PAGE 74
2022 ANNUAL REPORT
PAGE 75
CVR no. 32 89 54 68
MNE no. m ne45893
2022 ANNUAL REPORT
PAGE 76
DEFINITIONS
Acid test
(Total current assets – Inventories (inventories including biological
assets)-Assets held for sale (including Assets of disposal group classified
as held for sale)/Total current liabilities. The acid test or quick ratio
measures a company’s ability to use its near cash or quick assets to
immediately extinguish or retire its short-term liabilities (liabilities due
within the next twelve months).
Current ratio
Total current assets/Total current liabilities. The current ratio measures
a company’s ability to meet short-term obligations (liabilities due within
the next twelve months).
Earnings per share
Net result attributable to the shareholders of the Company/ year-end
number of common shares outstanding during the period (in accordance
with IAS 33). Earnings/loss per share for profit attributable to the equity
holders of the Company during the year, both basic and diluted.
EBITDA
EBITDA is calculated by adding to the operating profit the annual
depreciation of the fixed assets and amortisation of land-related long-
term prepayments.
EBIT
EBIT is calculated as the operating profit and does not include finance
income/cost, gains/losses from exchange rate differences and share of
profit/loss of investments accounted for using the equity method
Equity ratio
Total equity/Total assets. The equity ratio indicates how much debt a
company uses to finance its assets relative to equity.
Net debt
Total borrowings and the fair value of derivative financial instruments
(including Liabilities directly associated with assets classified as held for
sale -Cash and cash equivalents. Net debt is a measure of a company's
ability to repay its debts if they were all due today.
Return on assets
(ROA)
Net profit attributable to the owners of the parent company/Average total
assets. Return on assets compares income with total assets measuring
management’s ability and efficiency in using the firm’s assets to generate
profits.
Return on equity
(ROE)
Net profit attributable to the owners of the parent company/Average
equity excluding minority interest. Return on equity relates income with
the equity capital measuring management´s ability and efficiency in
generating a return to the shareholders of the Company
Book value per share
Total Stockholders’ equity/ year-end number of common shares
outstanding during the period (in accordance with IAS 33). The book
value per share measures the per share value of a company based on its
equity available to shareholders.