1Q 2017 INTERIM REPORT

Agromino A/S Registration number: CVR no. 29801843 Sundkrogsgade 5, DK-2100 København Ø 01.01.2017-30.06.2017

AGROMINO A/S 1H 2017 INTERIM REPORT MEUR EBITDA

12.3

9.7

9.4

1H 2015

1H 2017

1H 2016

9.5

NET PROFIT/LOSS 2.5 -14.9

•

1H 2017 EBITDA of EUR 9.4 million,

•

despite strong rapeseed yields, the

investments in shares of TDFE against a

reduction in estimated crop yields due

loss of EUR 1.4 million in 1H 2016, note

to

that this is a non-cash item as dividends

drought

reduces

the

value

of

biological assets

•

• • •

Increased direct expenses from applying

are not paid at present

•

2017 against a loss of EUR 22.1 million in

rise in land rentals

1H 2016

Administrative costs reduced

•

The intention is to fully repay the bridge

Write down of doubtful prepayment for

loan provided by a consortium of larger

fertilizers in amount of EUR 1.4 million

shareholders by September 1st 2017, the

Overall business turned round from a

facility having been used as necessary from

net loss of EUR 14.9 million in 1H 2016

April this year

•

Depreciation of the $USD:€Euro may well

2017

reduce Euro revenue for the year-end

Disposal of non-core part of elevator

result as majority of sales $USD based

business for EUR 1.1 million, resulting in a

•

profit of EUR 0.7 million included in 1H 2017

•

No loss from discontinued operations for 1H

higher priced imported fertilizers, and a

to a EUR 9.5 million net profit for 1H

•

Share of profit EUR 0.4 million from

Lower financial costs by EUR 2.8 million

Winter crop harvest completed and the sowing of 2018 winter crops underway

•

Controlled

Traffic

Farming

(CTF)

system initiated for the 2018 cropping

1H 2017 INTERIM REPORT

CEO COMMENT Physical Highlights Every farming year is different and 2017 has been no exception, our end result will almost certainly be affected by a six year low in rainfall levels across all of our Ukrainian clusters and the devaluation of the dollar, in which the majority of our sales are made. That being said we have achieved a company record yield for Oilseed Rape (1.91 tonne / ha net) and Peas (3.5 tonnes /ha net), and our Winter Wheat yield of 4.0 tonne per hectare, masks individual field yields of up to 8 tonne / ha in Kharkov and as low as 2.0 tonne / hectare in Nikolaev, where there has been a severe drought. The summer crops of Maize, Sunflower and Soya were established to a high standard but they are beginning to show signs of stress due to the lack of precipitation. There is no doubt that our policy of reduced tillage and trash retention will have given us a positive yield advantage in 2017. With our combine harvester fleet having reached an average age of over 10 years, for 2017 we invested in five new machines as part of our machinery replacement plan. We have taken the opportunity to use this timing to initiate what is known as a 12 meter Controlled Traffic Farming system, the target is that the whole company will be utilizing CTF within a four year period. The objective being to take more care of the soil, preserve moisture, reduce cultivation costs and increase yield. It is both an exciting and ambitious project, made possible due to a dedicated and high quality management team. The Dobruchi Dairy business continues to improve with its enthusiastic and proactive new management team, pushing the business forward. The milk yield is steadily rising and operationally the business is forecast to make a positive contribution in 2017

Financial Highlights Having last year disposed of the large non-core asset Rostov, plus successfully negotiated a full debt for equity swap of the SEK350m bond, and restructured many parts of the management, the business at the Q2 position is already showing the benefits of these major changes.

This year to date there are no substantial losses from discontinued operations, finance costs are much decreased due to the lower overall company debt, and due to the increased milk price in Europe our subsidiary investment in Trigon Dairy Farming Estonia is showing a positive contribution rather than the large negative in 2016. The combination of these factors has resulted in a Net profit for the first six months of the year of EUR 9.5 million which compares very favorably with the loss of EUR 14.9 million in 2016 at the same point. It has not all been plane sailing, we have had to purchase additional imported fertilizer at a higher price than we budgeted due to the nondelivery of the Ukrainian produced product, this has led to an increase in fertilizer costs, balanced to a degree by lower administrative costs after management restructuring. In 2016 a lower amount of fertilizers were used due to a lack of working capital. We have written down the doubtful prepayment for Ukrainian fertilizers in amount of EUR 1.4 million to be conservative; at the same time we have instigated court proceedings with the aim being to have returned this large prepayment. We cannot ignore the fact that the USD has this year devalued against the Euro by some 10%. The majority of our sales are made in USD and to date prices although a little firmer have not compensated for that devaluation. On a positive note the majority of our borrowings are USD based and as such in Euro terms have diminished. Another positive in the first half of the year was the disposal of the Ludmilovka elevator. With no land bank near this site to produce our own grain to be stored there, this old elevator with dated technology was neither useful or could be competitive with more modern installations of which there are many in the region, therefore to be able to sell it at a profit of EUR 0.7 million was deemed to be the best solution. In summary with winter crop yields perhaps better than might have been expected and still the summer crops to harvest we are expecting an average year. Simon Boughton August 31th 2017 CEO

PAGE 2


FINANCIAL AND OPERATIONAL REVIEW INCOME STATEMENT The Group’s operations are divided into the following operational segments: Ukraine cereals production including storage and trading; and milk production in Russia. The Group also has a 39.24% shareholding in Trigon Dairy Farming Estonia (TDFE), while reporting a share of profit/loss from this business in its financial statements.

Revenues A combination of higher milk price, strengthening rouble and increased revenue from sales of elevator services to third parties, strengthened total revenues for the Group in 1H 2017 by 14%. Sales of cereals and oilseeds stayed flat as improved prices were outweighed by larger volumes of lower value crops in the sales mix. Changes in biological assets Changes in biological assets amounted to EUR 20.9 million (EUR 22 million in 1H 2016) as the Group revalued its harvest using the latest information about prices, yields and harvest related cash outflows. In the light of the low rainfall in July and August, the estimated yields for late crops were revised downwards. For early crops the actual yields were used as the harvest was completed in August. It should be noted that in 2016 we had a disproportional area of the more profitable crop sunflower, due to previous autumn crop failures, this although very positive for 2016 was not rotationally sustainable. Depreciating dollar and hryvna also negatively affected the estimated crop value in euro terms, albeit point of sale costs were also lower. Expenses OPEX for 1H 2017 was up by EUR 1.7 million due to more fertilizer being applied (in 2016 a lack of working capital restricted amounts applied), a higher price of fertilizer, feed and land rental, while at the same time downsizing administrative costs. In 1H 2017 the Group wrote off the doubtful prepayment for fertilizers, totaling EUR 1.4 million and showed a loss under Other losses/gains-net.

Net result EBITDA for 1H 2017 remained down from 1H 2016, attributable to lower crop value, higher costs and losses. Still, the net profit for the Group, rose from a loss of EUR 14.9 million to a profit of EUR 9.5 million in 1H 2017. Improved profitability was mainly attributable to lower financial costs, financial income from the divestment of a non-core part of the elevator business, revised share of profit from investments and no loss from discontinued operations which was sold in 2016.

REVENUE BREAKDOWN (MEUR)

Elevator services

Sales of milk

Sales of cereals

-

0.5

1.0 1.5 1H 2017

2.0 2.5 3.0 1H 2016

3.5

4.0

OPEX (MEUR) Other expenses

Legal and consulting fees Office and administration expenses Transportation, other services and materials Fuel, gas, electricity

Repairs Animal feed Land tax and land rental Employee benefits expense

Seeds, fertilizers, chemicals -

1H 2017

0.8 1.6 2.4 3.2 4.0 4.8 5.6

1H 2016

PAGE 3


BALANCE SHEET Assets The consolidated assets of the Group as at June 30, 2017 amounted to EUR 58.3 million (EUR 45.1 million at December 31, 2016), mirroring the revaluation of biological assets during 2Q 2017.

LANDBANK (Hectares) Russian Milk production

Land held for sale

Total land under control as at June 30, 2017 stayed at the same level as in 2016 (59 thousand hectares). The Group owns land in Russian Milk production, together with land held for sale, while the Group leases land in Ukraine. Part of the plan to optimize its business operations was accomplished in 1H 2017 as a non-core part of its elevator business was disposed for EUR 1.1 million, resulting in a EUR 0.7 million profit from sale. Elevator´s useable storage capacity reached 78 thousand tonnes, however as it was unfavorably located, the Company’s own produce stored in the Elevator was non-existent and third parties also rarely used it, causing a poor financial performance.

Ukraine

-

10,000

20,000

30,000

1H 2017

40,000 2016

ASSETS BY SEGMENTS (MEUR)

Unallocated assets

Investments in associates (TDFE)

Milk production

Ukraine -

30.06.2017

7.0 14.0 21.0 28.0 35.0 42.0

31.12.2016

Liabilities and equity The total borrowings of the Group as at June 30, 2017 amounted to EUR 13.3 million (EUR 10.1 million as at December 31, 2016). During 1H 2017 the Group received new short-term working capital loans in Ukraine and Russia to finance its operating costs and new long-term finance leases in Ukraine as part of the investment plan to replace outdated machinery with new and modern equipment. During 1H 2017 the warrant holders exercised 13,773,792 warrants at a subscription price of EUR 0.02 each for a total cash consideration of EUR 275 thousand, contributing to the increase in equity. In May, 2017 the reverse share split took place by the consolidation of 100 shares of a nominal value of EUR 0.01 each into one share of a nominal value of EUR 1.00 each. Hence, the total number of issued shares as of June 30, 2017 amounted to 17,421,313 with a par value of 1 EUR per share.

BALANCE SHEET STRUCTURE 30.06.2017 100%

Cash

90% 80% Biological assets

Other liabilities

Borrowings

70% 60% 50% 40% 30%

Inventories Investments in associates Prepayments, receivables and other assets

Equity

20% 10%

Property, plant and equipment

0% Assets

Equity and liabilities

PAGE 4


UKRAINE

The Group has its cereals production operations in the Black Earth regions in Kharkov, Nikolaev and Kirovograd and owns four operational elevators with total usable storage capacity of 195 thousand tonnes. The Group is also engaged in intermediation of third-party goods.

FINANCIAL REVIEW The segment´s revenue is made up primarily from sales of own produced cereals. During first half of the year, the segment mostly sells grain from the last year´s harvest, showing revenue from the one side and negative change under Net changes in inventories from the other side. Revenue from sales of grain and oilseeds at EUR 6.1 million was unchanged from previous period as the Group increased sales of third party crops. Although sales price for each individual crop was higher, the average price was behind the quotes for 1H 2016 reflecting larger part of lower valued grain in the sales mix. Total revenues were lifted by EUR 0.4 million from 1H 2016 by the elevator business, handling more crops from third parties. Biological assets for first half of the year comprise of unharvested crops, the Group revalued its harvest using the latest available information about the yields, prices, harvest related costs and records this revaluation under Change in biological assets. In total, Change in

biological assets in the amount of 20.7 million fell from 1H 2016 as the estimated yields for drought affected late crops were adjusted downwards. It should be noted that in 2016 we had a disproportional area of the more profitable crop sunflower, due to previous autumn crop failures, this although very positive for 2016 was not rotationally sustainable. The actual yields for early crops were used as the harvest of wheat, rapeseed, barley, flax and peas was completed in August. The yield for rapeseed even broke the record. EUR/t

PRICES FOR REVALUING BIOLOGICAL ASSETS

330 280 230 180 130 80

Wheat

Sunflower

Rapeseed

1H 2016

Corn

Soya

1H 2017

By average, the prices used for revaluation were down from 1H 2016 as favorable sales contract for rapeseed was offset by

PAGE 5


depreciating dollar and hryvna lowering the prices for other crops in euro terms. On the back of weaker exchange rate combined with lower costs for elevator services, harvest related costs also declined. An increase in the sales of third party grain translated into added costs for purchased goods. OPEX for 1H 2017 rose by EUR 1.2 million driven by higher fertilizer expenses. Non-delivery of the Ukrainian produced fertilizer led to a purchase of higher-priced imported fertilizer. Additionally, the amount of fertilizers applied increased as in 2016 in 2016 a lack of working capital restricted amounts applied. The land rental prices have also grown in Ukraine. At the same time, the administrative costs were also reduced by EUR 0.6 million.

Overall, the EBITDA of EUR 9.2 million for 1H 2017 (EUR 12.2 million in 1H 2016) weakened in line with lower crop value and higher costs and losses. OPEX (MEUR) Other expenses

Legal and consulting fees Office and administration expenses Transportation, other services and materials Fuel, gas, electricity Repairs Land tax and land rental

Employee benefits expense Seeds, fertilizers, chemicals

Loss in the amount of EUR 1.6 million for 1H 2017 shown under Other (losses)/gains-net mainly corresponds to write down of doubtful prepayment for fertilizers in amount of EUR 1.4 as the supplier failed to fulfill its obligations. The Company is still trying to claim back the money as mentioned in the 1Q 2017 report, however the management took the conservative view of this case and for now has written off this claim.

1H 2017 Wheat Barley Sunflower Corn Soya Other Total

1H 2016 Wheat Barley Sunflower Corn Soya Other Total

Tonnes 2,713 13 8,696 9,363 932 175 21,892

Tonnes 192 62 16,876 3,464 188 19 20,801

Own produced, EUR thousand 407 1 2,699 1,357 327 39 4,830

Own produced, EUR thousand 20 6 5,182 473 54 5,735

Price* EUR/t 150 54 310 145 351 223 221

Price EUR/t 106 99 307 137 287 n/r 276

Tonnes 1,529 496 29 5,225 643 7,922

Tonnes 279 3 950 323 1,555

-

0.8 1.6 2.4 3.2 4.0 4.8 5.6

1H 2017

Third party, EUR thousand 211 59 9 748 217 1,244

Third party, EUR thousand 33 307 37 377

Price EUR/t 138 119 326 143 337 157

Price EUR/t 118 70 323 115 242

1H 2016

Tonnes 4,242 509 8,725 14,588 1,575 175 29,814

Tonnes 471 65 17,826 3,787 188 19 22,356

Total Revenue, EUR thousand 618 60 2,708 2,105 544 39 6,074

Total Revenue, EUR thousand 53 6 5,489 510 54 6,112

Price EUR/t 146 118 310 144 345 223 204

Price EUR/t 113 92 308 135 287 n/r 273

All prices exclude VAT, Domestic sales are ex elevator and export sales are CPT

PAGE 6


Ukraine Harvested hectares Wheat Sunflower Rapeseed Corn Barley Soya Other Total Net production, t Wheat Sunflower Rapeseed Corn Barley Soya Other Total Net yield, t/ha Wheat Sunflower Rapeseed Corn Barley Soya Other Total

2013 20,768 10,606 8,814 4,875 379 3,116 48,560

2014 20,756 11,934 8,011 3,547 116 2,348 176 46,888

2015 23,218 12,222 6,742 3,199 1,248 46,629

2016 19,536 16,529 4,416 1,879 424 3,044 330 46,157

2017E 21,399 9,413 7,570 1,179 335 3,550 1,862 45,308

2013 81,588 23,674 15,234 37,018 717 3,996 162,226

2014 98,733 24,038 14,766 24,490 411 4,158 1,165 167,759

2015 92,302 30,319 8,739 18,876 2,256 152,493

2016 74,788 37,619 6,309 15,620 1,449 7,653 5,693 149,130

2017E 85,491 18,761 14,487 7,263 719 6,243 3,560 136,525

2013 3.93 2.23 1.73 7.59 1.89 1.28 3.34

2014 4.76 2.01 1.84 6.91 3.53 1.77 6.62 3.58

2015 3.98 2.48 1.30 5.90 1.81 3.27

2016 3.83 2.28 1.43 8.31 3.42 2.51 17.28 3.23

2017E 4.00 1.99 1.91 6.16 2.15 1.76 1.91 3.01

EARLY CROP NET YIELDS

3.98

1.30

2015

4.00

3.83

1.91

1.43

2016 Rapeseed

2017 Wheat

PAGE 7


MILK PRODUCTION The Group’s managed milk production operations are located in the St Petersburg region of Russia. The Group also has a shareholding in Estonian milk production business through associate AS Trigon Dairy Farming Estonia (TDFE). The Group´s shareholding in TDFE amounted to 39.24% as of June 30, 2017.

The EBITDA of Milk production segment in Russia was influenced by the appreciating rouble, lifting the milk price in euro terms from the one side and increasing costs from the other side. In rouble terms, the milk price grew by 7% and expenses rose by 9% year on year, reflecting the hike in feed price. Milk production has shown a steady upward trend, while improving 9% from 1H 2016 and 11% from 1H 2015. In total, the EBITDA for 1H 2017 amounted to EUR 0.2 million (0.1 million in 1H 2016). The segment also bears the costs of the maintenance of the land held for sale which amounted in H1 to EUR 49 thousand.

Agromino’s share in TDFE’s profit/loss is shown on the income statement line ‘Share of profit of investments accounted for using the equity method’. The share of profit for 1H 2017 from TDFE amounted to EUR 0.4 million, a sharp contrast to a loss of EUR 1.4 million reported in 1H 2016, based on the elevated milk price.

MILK 0.42 0.36 0.32

4,192 3,765

1H 2015

3,831

1H 2016

Milk production tonnes

1H 2017

Milk price EUR/kg

PAGE 8


MARKET DYNAMICS AND OUTLOOK GLOBAL MARKET FOR GRAINS AND OILSEEDS

through increased sales from State reserves. The 6 million tonne hike in the forecast for Russian wheat production this year combined with better soybean yields estimate for USA, set a bearish tone for the price improvements in the near-term future. Still it must be noted that the harvest is still in its early stages and weather has a crucial role in determining the final result.

The USDA ‘World Agricultural Supply and demand,Demand Estimates’ issued August 10th reversed the ideas of a sharp drop in inventories, while lifting the expectations for crop output. World grain ending stock is projected to lower by 6%, with China, holding 43% of the total grain inventory in the world, accounting for the most of this change by trying to diminish its large national maize inventories

GRAIN AND OILSEEDS (MILLION TONNES)

GRAIN:WORLD ENDING STOCK 600 500

2,639

2,659

400

2,496

300

2,426

200

2,690

2,493

2,573

2,634

2,518

2,501 100 2013

2014 China

2015

Top producers

2016

2017

2013

2014 2015 Production

Other countries

CHICAGO SPOT PRICES

USD/t

2016 Consumption

USD/t

Corn

Aug-17

Jun-17

May-17

200

Mar-17

100

Feb-17

250

Dec-16

120

Nov-16

300

Sep-16

140

Aug-16

350

Jun-16

160

May-16

400

Mar-16

180

Feb-16

450

Jan-16

200

Wheat

2017

Soyabeans

Source: USDA

PAGE 9


UKRAINIAN MARKET FOR GRAINS AND OILSEEDS

UKRAINE GRAIN AND OILSEEDS (MILLION TONNES)

49 47 43 40 86

86

2016

2017

36 79

2013

80

2014

78

2015 Harvest

Exports

Source: USDA

EXW PRICES EXCL VAT

USD/t

USD/t

Wheat

Corn

Sunflower

Aug-17

Jun-17

200

May-17

220

100

Feb-17

240

110 Mar-17

260

120

Dec-16

280

130

Nov-16

300

140

Sep-16

320

150

Jun-16

340

160

Aug-16

360

170

May-16

380

180

Feb-16

400

190

Mar-16

200

Jan-16

Based on the latest estimate by the USDA, grain and oilseeds production is up for Ukraine from the previous report, attributable to the increase in yields. Wheat yield at 4.02 t/ha is taking into account resent harvest results as most of the wheat is harvested. Although dry conditions prevailed in the forest-steppe zone during the plant germination season, archived yield is only 3% down from last year and thanks to higher area, total wheat production will remain at the same level as in 2016. Corn and oilseed plants are estimated to benefit from the timely rains in late July and alleviate the drought-stressed plants. In total, harvest is predicted to remain at the 2016 level. Exports are projected at 47 million tonnes and will only be second to the record breaking marketing year in 2016/17, profiting a little from the elevated tariff-rate quotas to European Union.

Soyabean

Source: APK Inform

PAGE 10


THE SHARE Share information Official listing: NASDAQ Stockholm Form of listing: Common stock Sector: Agricultural Products Exchange ISIN: DK0060823516 Short name: AGRO Reuters ticker: AGROM.ST Bloomberg ticker: AGRO:SS

As at June 30, 2017 Agromino had approximately 2,114 shareholders. The total number of issued shares 17,421,313 also includes 42 treasury shares.

Major nominee shareholders as at 30.06.2017 GoMobile Nu AB Phoenix Commodities PVT. Ltd. CLEARSTREAM BANKING S.A., W8IMY BERTORP, JOHANNES FÖRSÄKRINGSAKTIEBOLAGET, AVANZA PENSION SKANDINAVISKA ENSKILDA BANKEN S.A., W8IMY SPARINVEST HSBC TRUSTEE OF MARLBOROUGH, EUROPEAN SEB-STIFTELSEN, SKAND ENSKILDA BNY MELLON OTHER TOTAL

Country Sweden Virgin Islands (GB) Luxembourg Sweden Sweden Luxembourg Luxembourg Great Britain Sweden Denmark

Agromino Share trade data (adjusted for reversed share split) MCap (period end), SEK (thousand) Average no of trades per day Average volume per trade Average number of traded shares per day Average turnover per day, SEK Average turnover per trade, SEK

No of shares 1,839,944 1,492,417 1,430,985 1,368,382 1,322,693 1,307,900 811,229 643,857 456,780 414,400 6,332,726 17,421,313

2015 66,110 38 60 2,284 172,846 4,574

Holdings in % 10.6% 8.6% 8.2% 7.9% 7.6% 7.5% 4.7% 3.7% 2.6% 2.4% 36.2% 100.0%

2016 276,537 40 227 9,162 180,628 4,477

1H 2017 365,848 79 576 45,728 836,179 10,531 Price, SEK

Volume 450,000

26.00

400,000

24.00

350,000 22.00

300,000 250,000

20.00

200,000

18.00

150,000

16.00

100,000 14.00

50,000

Total volume

04.08.2017

21.07.2017

07.07.2017

23.06.2017

09.06.2017

26.05.2017

12.05.2017

28.04.2017

14.04.2017

31.03.2017

17.03.2017

03.03.2017

17.02.2017

03.02.2017

20.01.2017

06.01.2017

23.12.2016

12.00

09.12.2016

-

Closing price SEK

PAGE 11


FINANCIAL CALENDAR Interim Report 9m 2017 Interim Report 4Q 2017 Annual Report 2017 Interim Report 1Q 2018 Interim Report 1H 2018

November 30, 2017 February 28, 2018 March 30, 2018 May 31, 2018 August 31, 2018

1H 2017 RESULTS PRESENTATION

A telephone conference for presentation of the 1H 2017 results will be held on August 31, 2017 at 10.00 CEST. Program: Simon Boughton, CEO and Konstantin Kotivnenko, Executive Board member, will present and comment upon the results. There will also be an opportunity to ask questions.

To participate in the telephone conference, please call one of the following numbers: DK: + 453 544 5575 FI: + 358 981 710 494 UK: + 442 030 089 808 NO: + 472 350 0254 SE: + 468 566 426 90 The presentation material will be available on www.agromino.com before the telephone conference starts. A recording of the telephone conference will be available afterwards on www.agromino.com. For further information, please contact: Mr. Simon Boughton, CEO and President of Agromino A/S Tel: +372 61 91 500 E-mail: [email protected] Agromino A/S Sundkrogsgade 5, DK-2100 Copenhagen, Denmark Phone: +372 61 91 500 E-mail: [email protected] Home page: www.agromino.com

PAGE 12


CONSOLIDATED CONDENSED STATEMENT OF FINANCIAL POSITION in EUR thousand ASSETS Current assets Cash and cash equivalents Trade and other receivables Inventories Biological assets Assets held for sale Non-current assets Prepaid land rents and land usage rights Other non-current prepayments and receivables Biological assets Intangible assets Property, plant and equipment Investments in associates

Note

30.06.2017

31.12.2016

3 4 5 6

2,912 4,902 1,814 22,085 1,562

3,646 6,701 7,287 1,914 1,576

33,275

21,124

952 257 1,936 16 14,517 7,369

1,045 234 1,994 24 13,795 6,924

25,047

24,016

58,322

45,140

5,662 12,248

3,869 10,072

17,910

13,941

17 1,002 696

18 10 750

1,715

778

19,625

14,719

17,421 120,151 -47,392 -51,832

17,284 120,013 -45,936 -61,276

38,348

30,085

3 5 6

Total assets LIABILITIES Current liabilities Trade and other payables Borrowings Non-current liabilities Trade and other payables Borrowings Deferred tax liabilities Total liabilities EQUITY Capital and reserves attributable to equity holders of the Group Ordinary shares Share premium Other reserves Accumulated deficit Non-controlling interest in equity

7 8

7 8

9 9

349

336

Total equity

38,697

30,421

Total equity and liabilities

58,322

45,140

The notes on pages 18 to 28 are an integral part of this consolidated condensed interim financial information.

PAGE 13


CONSOLIDATED CONDENCED INCOME STATEMENT in EUR thousand Continuing operations: Revenue

Note

2Q 2017

2Q 2016

1H 2017

1H 2016

3,410

3,332

8,858

7,748

-72

169

52

217

19,037

20,620

20,872

21,981

22,375

24,121

29,782

29,946

-2,090 -705

-3,248 -488

-5,082 -1,236

-5,782 -640

-6,191 -1,151 -381 -217 -1,556

-4,855 -871 -371 -637 68

-9,573 -2,162 -755 -724 -1,562

-7,662 -1,884 -742 -1,244 -426

10,084

13,719

8,688

11,566

244 4 -319

1,353 11 -1,693

277 686 -621

421 39 -3,385

244

-458

445

-1,443

Profit before income tax Corporate income tax

10,257 5

12,932 -19

9,475 -17

7,198 -21

Prifit for the period from continuing operations

10,262

12,913

9,458

7,177

Other income Gain/loss arising from changes in fair value less estimated point-of-sale costs of biological assets Total revenue, other income and fair value adjustments Net changes in inventories of agricultural produce and work in process Cost of purchased goods for trading purposes Raw materials and consumables used for production purposes Employee benefits expense Depreciation and amortization Other administrative expenses Other (losses)/gains - net

5

10

11

Gains/losses from exchange rate differences Finance income Finance costs Share of profit/loss of investments accounted for using the equity method

Discontinued operations Loss for the period from discontinued operations (attributable to equity holders of the company)

16

Profit/Loss for the period Attributable to: Equity holders of the Company Non-controlling interest Loss/profit per share for loss attributable to the equity holders of the Company during the period, both basic and diluted (expressed in Euros per share) From continuing operations From discontinued operations Prifit/Loss per share for loss attributable to the equity holders of the Company during the period, both basic and diluted (expressed in Euros per share)

16

12

-

-18,874

-

-22,111

10,262

-5,961

9,458

-14,934

10,264 -2

-5,943 -18

9,444 14

-14,903 -31

10,262

-5,961

9,458

-14,934

0.59 0.00

5.60 -17.03

0.54 0.00

5.56 -17.06

0.59

-11.43

0.54

-11.50


PAGE 14


CONSOLIDATED CONDENSED STATEMENT OF COMPREHENSIVE INCOME in EUR thousand Profit/Loss for the period Other comprehensive income: Items that will not be reclassified to profit or loss Gain on revaluation of land of continuing operations Items that may be subsequently reclassified to profit or loss Currency translation differences from continuing operations Currency translation differences from discontinued operations

6

16

Other comprehensive expense/income for the period; net of tax Total comprehensive income for the period Attributable to: Equity holders of the Company Non-controlling interest Total comprehensive income/expense for the period Total comprehensive income/ expense for the period attributable to owners of the Company arises from Continuing operations Discontinued operations

16

2Q 2017

2Q 2016

1H 2017

1H 2016

10,262

-5,961

9,458

-14,934

-

182

-

329

-1,899

2,380

-1,456

149

-

17,557

-

18,904

-1,899

20,119

-1,456

19,382

8,363

14,158

8,002

4,448

8,366 -3

14,176 -18

7,989 13

4,479 -31

8,363

14,158

8,002

4,448

8,366 8,366

15,493 -1,317 14,176

7,989 7,989

7,686 -3,207 4,479


PAGE 15


CONSOLIDATED CONDENSED STATEMENT OF CHANGES IN EQUITY Attributable to equity holders of the Company

Total 223

Noncontrolling interest 318

Total Equity 541

-14,903

-14,903

-31

-14,934

19,382

-

19,382

-

19,382

-

19,382

-14,903

4,479

-31

4,448

-63,517

-

-

63,517

-

-

-

-63,517 1,296 17,284 -

99,941 120,013 -

-45,454 -45,936 -

63,517 -51,082 -61,276 9,444

4,701 30,085 9,444

287 336 14

4,988 30,421 9,458

-

-

-1,456

-

-1,456

-

-1,456

-

-

-1,456

9,444

7,988

14

8,002

137

138

-

-

275

-

275

137 17,421

138 120,151

-47,392

-51,832

275 38,348

349

275 38,697

Share capital 64,814

Share premium 99,941

Other reserves -64,836

Accumulated deficit -99,696

Profit/loss for the period

-

-

-

Other comprehensive income

-

-

-

in EUR thousand Balance at 31.12.2015

Total comprehensive income Reduction in share capital (Note 9) Transactions with owners in their capacity as owners Balance at 30.06.2016 Balance at 31.12.2016 Profit/loss for the period Other comprehensive income Total comprehensive income Issuance of share capital Transactions with owners in their capacity as owners Balance at 30.06.2017


PAGE 16


CONSOLIDATED CONDENSED STATEMENT OF CASH FLOWS in EUR thousands Cash flows from operating activities Continuing operations Cash receipts from customers Cash paid to suppliers and employees Income tax paid Subsidies received Interest received Net cash outflow from discontinued operations Net cash used in/generated from operating activities Cash flows from investing activities Continuing operations: Acquisition of subsidiary, net of cash acquired Disposal of subsidiary, net of cash disposed of Proceeds from sales of shares in associate Purchase of property, plant and equipment Proceeds from sales of property, plant and equipment Net cash inflow from discontinued operations (incl proceeds from sale) Net cash generated from investing activities Cash flows from financing activities Continuing operations: Proceeds from issues of shares Proceeds from borrowings Repayments of borrowings Repayments of finance lease liabilities Short-term loans received from related parties Short-term loans repaid to related parties Interest paid Net cash outflow from discontinued operations Net cash generated from/used in financing activities Net decrease/increase in cash and cash equivalents Effects of exchange rate changes on cash and cash equivalents Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period

Note

16

6 6 16

9 8 8 8 15 15 16

1H 2017

1H 2016

9,572 -13,210 -109 49 19 -3,679

10,851 -10,032 -26 86 12 -728 163

6 1,107 -989 232

-13 1,504 -378 54

-

10,505

356

11,672

275 3,895 -827 -1,050 1,282 -714 2,861

1,143 -2,531 -56 900 -400 -889 -5,267 -7,100

-462 -272 3,646 2,912

4,735 -118 1,901 6,518


PAGE 17


NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL INFROMATION 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, Russia and Estonia. The Company was established on December 11, 2006. The Company has subsidiaries in Estonia, Cyprus, Russia and Ukraine (together hereinafter referred to as “the Group”). The parent company is a limited liability company incorporated and domiciled in Denmark. The address of its registered office is Sundkrogsgade 5, DK-2100 Copenhagen. The

company listed its shares on the Stockholm First North Stock Exchange in May 18, 2007. From December 8, 2010, the company’s shares have been traded on the main market Small Cap segment on NASDAQ Stockholm. The Group’s owners are legal and physical persons and no sole shareholder has control over the Group’s activities. These financial statements were authorised for issue by the Board of Directors on August 31, 2017.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES BASIS OF PREPARATION This condensed consolidated interim financial information of Agromino A/S for the six months ended June 30, 2017 has been prepared in accordance with IAS 34, 'Interim financial reporting' as adopted by the European Union, and additional Danish disclosure requirements for listed companies. The condensed consolidated interim financial information should be read in conjunction with the annual financial statements for the year ended December 31, 2016, which have been prepared in accordance with IFRS as adopted by the European Union and additional Danish disclosure requirements for listed companies. The accounting policies applied are consistent with those of the annual ﬁnancial statements for the year ended December 31, 2016, as described in those annual ﬁnancial statements.

CHANGES TO COMPARITIVES Following the reverse share split in May 2017, the Group has restated the Earnings/loss per share figure for 1Q 2017, 1H 2016 and 2Q 2016 based on the new number of shares as the consolidation of ordinary shares reduced the

number of ordinary shares outstanding without a corresponding reduction in resources. The number of ordinary shares outstanding before the event was adjusted for the proportionate change in the number of ordinary shares outstanding as if the event had occurred at the beginning of the earliest period presented (Note 9, 12).

NOTE ON UKRAINE Ukraine The relationships between Ukraine and the Russian Federation have remained strained in 2017. The final resolution of the political and economic crisis in Ukraine and the final effects are difficult to predict but it may have further severe effects on the Ukrainian economy and the Group´s business. At June 30,2017, the official NBU exchange rate of Hryvna against US dollar amounted to UAH 26.10 per USD 1 compared to 27.19 per USD 1 as at December 31, 2016. In June, annual inflation stood at 15.6%. For further information, please refer to Note 4.3 in the 2016 Annual report.

PAGE 18


3. TRADE AND OTHER RECEIVABLES in EUR thousand Trade receivables Other receivables Prepayments Total receivables and prepayments Less non-current portion: Prepayments for non-current assets Other receivables Total non-current portion Current portion

The fair values of trade and other receivables are not materially different from the carrying values based on the expected discounted cash flows. All non-current receivables are due within more

30.06.2017 498 1,860 2,801

31.12.2016 951 228 5,756

5,159

6,935

-246 -11

-222 -12

257

234

4,902

6,701

than one year from the balance sheet date. Noncurrent prepayments will realize in non-current assets, like property, plant and equipment.

4. INVENTORIES Inventory breakdown, EUR thousand Grain for sale Raw materials, supplies Fieldworks in process Total

Grain for sale is revalued by the Group on each balance sheet date using contracted and market prices. 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, Breakdown of the grain for sale, agricultural produce inventory, 30.06.2017 Wheat Barley Sunflower Corn Rapeseed Soya Other Total

30.06.2017 81 1,719 14

31.12.2016 4,643 2,137 507

1,814

7,287

and actual sales transactions by the Group shortly after the balance sheet date.

Grain for sale, agricultural produce, EUR thousand 42 19 1 11 4 1 3 81

Tonnes 321 165 2 90 13 5 112 708

Average price used, EUR/t 131 113 302 120 322 299 27 114

PAGE 19


Breakdown of the grain for sale, agricultural produce inventory, 31.12.2016 Wheat Barley Sunflower Corn Rapeseed Soya Other Total

Grain for sale, agricultural produce, EUR thousand 443 3 2,897 1,230 3 5 62 4,643

Tonnes 2,926 23 8,744 9,494 8 16 383 21,594

Average price used, EUR/t 152 113 331 130 337 323 162 215

5. BIOLOGICAL ASSETS in EUR thousand Carrying amount at 31.12.2015 Non-current biological assets Current biological assets 1H 2016 Gain/loss arising from changes in fair value less estimated point of sale costs of biological assets: - Increases due to new plantations/birth - Harvest - Decreases due to written-off biol.assets Remeasurement of biological assets to fair value less cost to sell (Note 16) - Other changes in fair value Currency translation differences Carrying amount at 30.06.2016 Non-current biological assets Current biological assets

in EUR thousand Carrying amount at 31.12.2016 Non-current biological assets Current biological assets 1H 2017 Decrease due to sales Gain/loss arising from changes in fair value less estimated point of sale costs of biological assets: - Increases due to new plantations/birth - Harvest - Decreases due to written-off biol.assets - Other changes in fair value Currency translation differences Carrying amount at 30.06.2017 Non-current biological assets Current biological assets

Gain/loss arising from changes in fair value less estimated point of sale costs of biological

Plant Animal cultivation husbandry

Total

2,367 118 2,249

1,544 1,544 -

3,911 1,662 2,249

21,256 24,494 -2,471 -48

6 74 -171

21,262 24,568 -2,471 -219

-719 733 24,356 134 24,222

103 198 1,748 1,748 -

-719 103 931 26,104 1,882 24,222

Plant cultivation

Animal husbandry

Total

2,027 113 1,914

1,881 1,881 -

3,908 1,994 1,914

-1

-1

23 91

20,872 22,799 -1,839 -192 104 -758 24,021 1,936 22,085

20,849 22,708 -1,839 -20 -667 22,209 124 22,085

-172 104 -91 1,812 1,812 -

assets for 1H 2016 include a loss of EUR 719 thousand from discontinued (Note 16).

PAGE 20


As at the balance sheet date, Current biological assets in plant cultivation include winter crops seeded in autumn 2016 and in 1H 2017. 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 costs 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. As the main growth period for the crops is April to July, the change in the fair

value is always highest during the second quarter of the year. The biological assets in plant cultivation have been revalued using the latest information about the yields, prices and harvest related cash outflows.

EUR per tonne Wheat Sunflower Rapeseed Corn Barley Soya Peas Flaxseed

Ukraine 1H 2016 1H 2017 121 117 290 275 290 325 131 120 110 117 330 280 180 246

6. PROPERTY, PLANT AND EQUIPMENT Depreciation charge during 1H 2016 in amount of EUR 81 thousand is presented within discontinued operations (Note 16). The Group’s acquisitions of property, plant and equipment during the period amounted to EUR 2,330 thousand (EUR 368 thousand in 1H 2016).

in EUR thousand

Land

Starting from September 30, 2016 the Group reclassifies land in Milk production segment not being used in production cycle as an asset held for sale, as at June 30, 2017 the value of the land held for sale totaled EUR 1,479 thousand.

Buildings

Vehicles & machinery

Furniture, fittings & equipment

Construction in process

Total

31.12.2016 Cost Accumulated depreciation

913 -

11,640 -3,106

15,359 -12,506

836 -761

1,420 -

30,168 -16,373

Net book amount

913

8,534

2,853

75

1,420

13,795

1 -

11 -250

2,062 -20

79 -2

177 -

2,330 -272

-

32 -221

54 -449

-18

-86 -

-688

1H 2017 Additions Disposals Reclassification balance sheet items/between groups Depreciation charge Currency translation differences Closing net book amount

-18

-384

-174

-4

-68

-648

896

7,722

4,326

130

1,443

14,517


896 -

10,875 -3,153

16,767 -12,441

888 -758

1,443 -

30,869 -16,352

Net book amount

896

7,722

4,326

130

1,443

14,517

PAGE 21


in EUR thousand

Land

Buildings

Vehicles & machinery

Furniture, fittings & equipment

Construction in process

Total


8,460 -

11,158 -2,669

18,779 -14,363

807 -748

1,363 -

40,567 -17,780

Net book amount

8,460

8,489

4,416

59

1,363

22,787

-

18

291

4

55

368

329

-

-

-

-

329

3

-14

-935 -28

-5 0

-7 103

-947 -148

-

-213

-521

-13

-

-747

1H 2016 Additions Changes due to revaluation through Other Comprehensive Income Remeasurement to fair value less cost to sell (Note 16) Disposals

-

Depreciation charge

-

Currency translation differences Closing net book amount

753

202

15

-2

124

1,092

9,539

8,482

3,238

45

1,430

22,734


9,539 -

11,377 -2,895

15,386 -12,148

794 -749

1,430 -

38,526 -15,792

Net book amount

9,539

8,482

3,238

45

1,430

22,734

7. TRADE AND OTHER PAYABLES in EUR thousand Trade payables Prepayments from clients Social security and other taxes Accrued expenses Amounts due to related parties (Note 15) Other payables Less: non-current portion

30.06.2017 520 33 898 2,488 1,298 442

31.12.2016 447 472 1,365 1,060 95 448

5,679

3,887

-17

-18

5,662

3,869

Fair values of trade and other payables are not materially different from book values due to short maturities.

8. BORROWINGS The total borrowings of the Group as at June 30, 2017 amounted to EUR 13,250 thousand (EUR 10,082 thousand as at December 31, 2016). During 1H 2017 the Group received new loans in amount of USD 1,500 thousand (EUR 1,402 thousand) with maturity date in 2017, USD 2,023 thousand (EUR 1,859 thousand) with maturity date in 2018, RUB 13,053 million (EUR 210 thousand) with maturity date in 2018 and new long-term finance leases in Ukraine with maturity dates in 2020. In 1H 2017 the Group

refinanced factoring in amount of RUB 26,758 thousand (EUR 424 thousand). Details of the borrowings’ currencies, interest rates and maturities are shown in the included tables. Total finance costs in 1H 2017 amounted to EUR 621 thousand (EUR 3,385 thousand in 1H 2016). In the Cash flow statement proceeds/repayments of borrowings and interests are shown in a different amount due to changes in foreign exchange rates, different

PAGE 22


periodization of interest payments compared with accrual of interest expenses and due to finance lease payables (Cash flow statement reflects only actual payments and not changes in the Balance sheet items). 30.06.2017, in EUR thousand RUB-nominated RUB-nominated USD-nominated USD-nominated UAH-nominated Less: non-current portion

31.12.2016, in EUR thousand RUB-nominated RUB-nominated USD-nominated USD-nominated UAH-nominated Less: non-current portion

30.06.2017 219 655 7,651 3,193 1,532 13,250 1,002 12,248

Maturity 2017-2018 2017 2017-2018 2017 2020

Interest rate 5%-25.5% CBR base rate+3% 6.5%-8.0% LIBOR+7.5% LIBOR+ 3.6%-14.8%

31.12.2016 290 725 4,974 4,092 1 10,082 10 10,072

Maturity 2017-2018 2017 2017 2017 2017

Interest rate 13.5%-25.5% CBR base rate+3% 9.5% LIBOR+9.5% no interest

9. SHARE CAPITAL Number of shares

Incl. ordinary shares

Share capital

Share premium

Total

129,627,479

129,627,479

64,814

99,941

164,755

-63,517

-

-63,517

30.06.2016

129,627,479

129,627,479

1,296

99,941

101,237

31.12.2016

1,728,357,479

1,728,357,479

17,284

120,013

137,297

13,773,821

13,773,821

137

138

275

-4,221

-4,221

-

-

-

-1,724,709,987

-1,724,709,987

-

-

-

17,421,313

17,421,313

17,421

120,151

137,572

42

42

-

-

-

in EUR thousand 31.12.2015 Reduction in share capital

Issuance of share capital Purchase of treasury shares Reverse share split 30.06.2017 Including treasury shares

As at June 30, 2017 the total number of issued shares was 17,421,313 including 42 treasury shares with a par value of 1 EUR per share, while as of December 31, 2016 the number of shares was 1,728,357,479 (par value of 0.01 EUR per share as at December 31, 2016). All shares have been fully paid. The shares of Agromino A/S are listed on main market of Small Cap segment on NASDAQ Stockholm. In 1Q 2017, following the exercise of the warrants by the shareholders, the share capital

increased as a result of the issuance of 13,773,792 shares each of nominal value EUR 0.01. In total, 6.9% of the warrants were exercised during the first exercise period at a subscription price of EUR 0.02 each for a total cash consideration of EUR 275 thousand. Therefore, share capital increased by EUR 137 thousand and share premium was recorded in amount of EUR 138 thousand. In April, 2017 Agromino A/S issued 29 new shares (par value of 0.01 per share) to increase its share capital.

PAGE 23


In May, 2017 the reverse share split took place by the consolidation of 100 shares of a nominal value of EUR 0.01 each into one share of a nominal value of EUR 1.00 each. Hence, a total number of issued shares as of June 30, 2017 amounted to 17,421,313 shares of nominal value EUR 1 each, including 42 treasury shares.

Agromino A/S had to redeem the 4,221 Remaining Fractional Shares at a price EUR 0.02 per 1 share with a nominal value EUR 0.01 each, the number of treasury shares following the reverse share split amounted to 42 shares of a nominal value of EUR 1.00 each.

10. RAW MATERIALS AND CONSUMABLES USED FOR PRODUCTION PURPOSES in EUR thousand Seeds, fertilizers, chemicals Animal feed Repairs Fuel, gas, electricity Land tax and land rental Other services and materials

Increase in fertilizer costs for 1H 2017 were down to higher price for imported fertilizers

1H 2017 5,024 844 1,030 679 1,466 530

1H 2016 4,272 585 754 470 1,240 341

9,573

7,662

and expenses for animal feed rose on the back of higher feed price.

11. OTHER (LOSSES)/GAINS-NET in EUR thousand VAT in Ukraine Write down of doubtful receivables and prepayments (Note 3) Foreign exchange losses/gains net Other losses / gains net

The Group wrote off the prepayment for the undelivered fertilizers during 1H 2016 in amount of EUR 1.4 million EUR. The Group is

1H 2017 -1,846 97 187

1H 2016 -29 -188 443 -652

-1,562

-426

still trying to claim back the money, however the management decided to take the conservative view of this case.

12. EARNINGS/LOSS PER SHARE Basic earnings/loss per share is calculated by dividing the profit attributable to the equity holders of the Group by the weighted average number of ordinary shares outstanding during the year. Following the reverse share split in May, 2017 (Note 9), the Group restated its Earnings/loss per share figure for previous periods as the consolidation of ordinary shares reduced the number of ordinary shares

outstanding without a corresponding reduction in resources. The number of ordinary shares outstanding before the event was adjusted for the proportionate change in the number of ordinary shares outstanding as if the event had occurred at the beginning of the earliest period presented. Accordingly, the new weighted average number of ordinary shares outstanding was calculated by dividing the number of

PAGE 24


shares by 100 from January, 2016 till May, 2017.

in EUR thousand Profit/Loss attributable to equity holders of the parent (EUR thousand) Weighted average number of ordinary shares outstanding (thousands) Basic profit/loss per share (EUR per share) From continuing operations From discontinued operations (Note 16)

1H 2017 9,444 17,375

1H 2016 -14,903 1,296

0.54 0.54 0.00

-11.50 5.56 -17.06

13. SEGMENT REPORTING Primary measures monitored by the Executive Board are segment OPEX (which is defined as operating expenses less Depreciation and amortization) and segment EBITDA (which is defined as Total segment revenue, other income and fair value adjustments adjusted with Changes in inventories of agricultural produce and work in process less operating expenses before Depreciation and amortization). The management considers two continuing business segments (Ukraine and Milk production) and cereals production cluster in Russia is considered as discontinued operation (Note 16) as it was sold in 2016. The Group uses the equity method to record the accounts of the Milk production segment in Estonia as the profit/loss on the Income Statement is shown under the line Share of loss/profit of investments accounted for using the equity method. Ukraine segment includes cereals production, storage and trading operations.

Cereals are produced for sale only in cereal production segment located in the Black Earth regions in Ukraine. In the Milk production segment, cereals are produced only in crop rotation order and used mainly as animal feed. In this segment, cereals are considered to be side production. The Group’s business is seasonal by its nature. The largest increase in fair value of biological assets occurs during the plant growth season from March to September and consequently the largest gains are recognized in the second quarter. The harvest starts in the last days of June and usually lasts until the end of October but subject to weather conditions can continue also to November. During the harvest time, the prices for the cereals are usually lowest and the Group may use its storage capacities to keep the crops until the price increases. The income from milk sales has the least seasonal nature.

PAGE 25


1H 2017, in EUR thousand Revenue between segments Revenue from external customers Total segment revenue Subsidies Other income Gain/loss arising from changes in fair value less estimated point-of-sale costs of biological assets Total revenue, other income and fair value adjustments Net changes in inventories of agricultural produce and work in process Cost of purchased goods OPEX Other (losses)/gains - net EBITDA Depreciation and amortization Finance income/costs Share of profit of investments accounted for using the equity method Profit/loss before income tax Additions of Property, plant and equipment

1H 2016, in EUR thousand Revenue between segments Revenue from external customers Total segment revenue Subsidies Other income Gain/loss arising from changes in fair value less estimated point-of-sale costs of biological assets Total revenue, other income and fair value adjustments Net changes in inventories of agricultural produce and work in process Cost of purchased goods OPEX Other (losses)/gains - net EBITDA Depreciation and amortization Finance income/costs Share of profit of investments accounted for using the equity method Profit/loss before income tax Additions of Property, plant and equipment

Ukraine 7,065 7,065

Milk production 1,793 1,793

Total 8,858 8,858

8

41 3

41 11

20,747

125

20,872

27,820

1,962

29,782

-5,182 -1,236 -10,606 -1,558 9,238

100 -1,853 -4 205

-5,082 -1,236 -12,459 -1,562 9,443 -755 342

445 2,319

11

445 9,475 2,330

Ukraine 6,522 6,522

Milk production 1,226 1,226

Total 7,748 7,748

119

97 1

97 120

21,875

106

21,981

28,516

1,430

29,946

-5,855 -636 -9,427 -385 12,213

73 -4 -1,363 -41 95

-5,782 -640 -10,790 -426 12,308 -742 -2,925

-1,443

-1,443 7,198 368

135

233

14. GROUP STRUCTURE The Group’s parent company A/S Agromino is registered in Denmark. The parent company owns directly eleven subsidiaries (including a branch in Estonia), which are holding companies

for the Group operations in Estonia, Ukraine, Russia. These holdings are: Trigon Farming AS (Estonia); TC Farming Russia Ltd. (Cyprus), TC Farming Ukraine Ltd. (Cyprus), Trigon Dairy

PAGE 26


Farming AS (Estonia), Trigon Security Llc. (Ukraine), JSC CT-2 (Russia), JSC Novaya ferma (Russia), JSC Agrokompleks (Russia), JSC CT-1 (Russia), LLC Trigon Moloko (Russia), Agromino A/S Eesti filiaal (Estonia). Trigon Dairy Farming AS owns 39.24% stake in AS Trigon Dairy Farming Estonia (a holding company for milk production operations in Estonia).

Transfer of funds from subsidiaries to A/S Agromino is not restricted. However, transfer of funds from Ukraine and Russia to intermediary holdings may be subject to restrictions in relation to foreign currency transactions due to the occasional limitations in local legislation. Currently there are currency controls in place in Ukraine.

15. RELATED PARTY TRANSACTIONS The Group’s owners are legal and physical persons and no sole shareholder has control over the Group’s activities. AS Trigon Dairy Farming Estonia (a holding company for milk production operations in Estonia where the Group has a 39.24% stake) is considered a related party.

Other related parties comprise of companies which are controlled by the Group´s management personnel or the members of the Board of Directors.

in EUR thousand Sales and purchases Other sales (Companies under control of Members of Board of Directors) Interest paid to related parties (Companies under control of Members of Board of Directors) Purchase of goods and services from related parties (Companies under control of Members of Board of Directors /Trigon Capital)

Balances from sales/purchases of goods/services

1H 2017 145

1H 2016 -

-73

-8

-3

-100

30.06.2017

31.12.2016

Payable to related parties (Companies under control of Members of Board of Directors) (Note 7)

1

95

Loans from related parties (Companies under control of Members of Board of Directors) in EUR thousand Beginning of the year Loans advanced Loan repayments made Interest charged Interest paid

1H 2017 1,297 73 -73

2016 900 -900 28 -28

1,297

-

End of the period (Note 7)

PAGE 27


16. DISCONTINUED OPERATIONS AND DISPOSAL GROUP On November 3, 2015, the Group announced that a framework agreement for the divestment of its Rostov cluster was signed (Russian cereals production) and on June 2, 2016 the divestment transaction was completed, for the total price of EUR 13,300 thousand. The loss from discontinued operations in 1H 2016 amounted to EUR 22,111 thousand, including re-measurement due to change in agreement terms in the amount of EUR 3,303

thousand and Currency translation differences recycled from Other comprehensive income to Income statement in amount of EUR 19,863 thousand. The results of operations related to Rostov cluster are distinguished from continuing operations and shown as discontinued operations. Financial information related to the Rostov cluster is set out below. Please refer to the Annual Report 2016 for more detailed information about discontinued operations.

Income statement information in EUR thousand

30.06.2017

30.06.2016

Total revenue, other income and fair value adjustments and net changes in inventories Expenses Gain/losses from exchange rate differences* Profit before income tax from discontinued operations Income tax Profit after income tax from discontinued operations Remeasurement to fair value less cost to sell (Note 4,5,6)

-

3,107 -2,725 690 1,072 -17 1,055 -3,303

Currency translation differences recycled from Other comprehensive income to Income statement Loss from discontinued operations

-

-19,863 -22,111

30.06.2017 -

30.06.2016 -22,111

Comprehensive income information in EUR thousand Loss for the period from discontinued operations Other comprehensive income: Items that may be subsequently reclassified to profit or loss Currency translation differences from discontinued operations

-

-959

Currency translation differences recycled from Other comprehensive income to Income statement

-

19,863

Other comprehensive income/expense for the period; net of tax from discontinued operations

-

18,904

Total comprehensive income/expense for the period from discontinued operations

-

-3,207

17. EVENTS AFTER THE BALANCE SHEET DATE The Group completed harvesting of early crops in August 12, 2017, archiving very strong rapeseed yield. However, to due to drought conditions, the estimated yields for late crops have been revised downwards. The sowing of winter crops for 2018 harvest is underway.

The intention is to fully repay the bridge loan provided by a consortium of larger shareholders by the first of September, having been used as necessary from April this year

PAGE 28


MANAGEMENT STATEMENT The Board of Directors and the Executive Board have reviewed and approved the Interim Report of the Agromino Group. The Interim Report, which has not been audited or reviewed by the Group’s auditor, has been prepared in accordance with IAS 34 and additional Danish disclosure requirements for listed companies.

In our opinion, the Interim Report provides a true and fair view of the Group's assets, liabilities, financial position, results of operations and cash flows. Furthermore, in our opinion, the Interim Report provides a fair review of the developments in the Group's activities and financial position, and describes the significant risks and uncertainties that may affect the Group.

August 31, 2017

__________________ __________

__________________

Johannes Bertorp

Jens Bruno

Martin Rosenmejer

Chairman of the

Member of the

Member of the

Board of Directors

Board of Directors

Board of Directors

__________________

_________________________

Simon Boughton

Konstantin Kotivnenko

Chairman of the

Member of the

Executive Board

Executive Board

_

__________________

PAGE 29


DEFINITIONS

Earnings per share

Net result attributable to the shareholders of the Company/ weighted average number of common shares outstanding. 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 longterm prepayments.

PAGE 30

1Q 2017 INTERIM REPORT

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